"Get rich first"
International Viewpoint #248 September 1993 momentum of the struggle and develop a consciousness that would make it possible to defend all thirty-one pits. They organised the demonstration which mobilised 15,000 people one week after the initial Commons Trade and Industries select committee report. The march was militant and uncompromising in arguing that no pits should close.
During the long drawn out process of the government's review, it was the women who took the initiative, to try and build and maintain the morale of the men. The government was successful in its attempts to dissipate the uproar that the announcement had made. The TUC showed their bankruptcy again with their refusal to organise a series of one day general strikes. It is clear that if there had been a one day stoppage it would have met with a massive response. Indeed the first mass demonstration showed this. The support that was also expressed on the following Sunday, where marchers waited for hours in the pouring rain, illustrated what was possible. The women were not content to sit and wait and do nothing, they were prepared to fight and organise. As well as organising the demonstrations they were responsible for the establishment of camps outside the most vulnerable pits. These camps became a focus for the struggle, on occassion acting as a launch pad for occupations in some of the pits? Each step of the way it was the women who were largely responsible for showing what would be necessary if the miners were to win their battle to save their jobs and establish a more rational energy policy.
It was quite clear that if the labour movement had followed the women's example and occupations of the pits and the TUC had supported this with a series of one day general strikes the battle to save the 31 pits would have been successful.
The public sector is now coming into the forefront of the struggle for wages and conditions of employment, and defence of public services. This struggle will be extremely important for the future of the labour movement. The proposed cuts will have major repercussions for women. Moreover, women are the majority of the public sector workforce and a majority of users. This debate raises fundamental questions about women's oppression.
This is why women will give the lead in forging an effective alliance between workers in the public sector and the users of public services in defence of the welfare state.*
8. The "select committee" is a committee of the British parliament.
9. On one occasion women occupied the British Coal headquarters. The story was never reported. The government put out what is called a "D Notice", restricting press reporting. 26
The 20 August China Daily reported that state enterprises were to be given full decision making powers by the end of the year. The stated aim is to make the debt ridden sector answerable to market forces by 1998. But as
Ossi Rask points out, in the first of two articles, enterprise managers and local state bureaucrats have already been taking matters into their own hands. Their aim however, is a dash for personal profit. OSSI RASK* - Stockholm, August 19, 1993
C
HINA is now a "socialist market economy". "A total breakthrough for socialist economic theo"The massive theoretical contribution of Deng Hsiao Ping constitutes a revolution of Marxism..."
"To put the word 'socialist' in front of the phrase "market economy' is without comparison in the history of world development..."
The sound of the oily poets of court, praising the Fourteenth Congress of the
As a foreign visitor you must laugh when you confront the enormous gulf between this and what you can see with your own eyes. But the Chinese are not lau-
Something is wrong. It has something to do with with the unofficial slogan of the lower-level bureaucrats: "The more chaos, the better."
Standing outside the central station of Gwongzhou, provincial capital of Canton, one wonders: where are all these people
Where do they come from? A woman in uniform instructs the billowing mass of people with a megaphone. Three men are quarrelling with a man sitting on his heels. It concerns a stolen ticket. He is a living statue. They smack him with an open hand. Suddenly, a hard kick in the face! A policeman close by, watches - says nothing, does nothing.
A country with 1.2 billion people. A Party with some 45 million members. The leaders of this Party rule one fourth of humanity.
The Gross National Product (GNP) of China last year grew by 12.8%. In the first quarter of this year GNP reached 14%. Compare this with the 1-3 or 4% in member countries of the Organisation for Economic Co-operation and Development
At the same time inflation has passed 10% in the countryside. In China's largest 35 cities it is estimated to be 17% or higher and on the increase. More and more people are buying immediately to get something for their money and the system begins to overheat.
Inflation arose from the new freedom to increase profits by increasing prices. "To be the first to be rich", as Deng Hsiao Ping said. Price controls have been gradually lifted since 1979 and "the market" now determines the price on 80% of all products.
The prices on grain, rice and other basic industrial products from the countryside are still decided by the government. In June of this year the New China News Agency comfortingly assured us that the prices were "unreasonably low but the situation has improved." When the products from the countryside reach the city they are sold at a completely different price than when they were sold to the first bureaucrat.
Inflation also arose from the opening to the world market. From June 1 the government removed the price controls on the so-called swapmarkets. In the three weeks following the yuan plunged more than 30% against the US dollar, although it then stabilised.
Thus, someone dealing in the foreign markets - and the numbers of people
* The author, who visited China during the summer, expresses his thanks to the Hong Kong based socialist journals Sprout and October Review.
1. "Swapmarket" is the term used most often in the local press to describe the various forms of currency exchange that are now prevalent.
International Viewpoint #248 September 1993 involved is large — will only accept yuan at a higher and higher price, in order to get something for it when it is time to change currency. Alternatively, they do not accept yuan at all. Between 20-40% of all Hong Kong dollars are circulating in mainland
Thirdly, inflation and "growth" arose out of uncontrolled credit. Local banks and state companies lend and borrow money from each other, from the public and from foreign sources, without permission and at a rate of interest that can be three or four times higher than the central bank. The current symbol for this phenomenon is the trial of the Great Wall company which borrowed 1 billion yuan from 200,000 citizens at a rate of interest of 24%. The trial drags on. There are too many people involved in the scandal who do not want a result. The company is state-owned but has been described by the press as...
"semi-private".
On the whole, the tone amongst the cadres of the party-state has been set. They strive to transform or split off the capital of the state and make it private; they look for short-cuts in treating companies, institutions and funds as their own. Standard
Chartered bank have reported that the comrades are now the biggest foreign investor and actor on the Hong Kong
However, what does concern the Hong
Kong Exchange is whether or not Beijing will manage, or wants to discipline the lower bureaucracy, stop the credit fiesta, stop the theft of money from funds. If so, then it is bad for the stockmarket.
### Real estate
The bureaucracy in mainland China has also become the number one foreign player on the Hong Kong real estate market. Since the Gulf war the value of Hong
Kong real estate has increased by 200 per
Who will benefit if there is a breakdown in the system? Marc Faber, a well known capitalist in Hong Kong commenting on the fall of the yuan: "The economic changes in China have created a class of people who have invested in an economic collapse." The unskilled members of this "class" just change their yuans to dol-
In southern China the fields that were previously used for rice and other crops are being cleared for real estate projects. Hotels, offices, summerhouses, golf courses. The land is waiting for the arrival of foreign guests. There is a lot of waiting going on. Speculation, corruption or sitting at the side and getting paid for helping is the natural reflex of the bureaucracy.
### Big profits
There will be high "growth" in real estate, the entertainment industry, durable consumer goods. Big profits will be made, or at least will be expected. In agriculture, the infrastructure, primary goods industry and energy there is no money to be made and the problem is one of low growth.
capital is flowing from the latter to the former, from north to south. The railways can only meet 60% of the demand. Electricity is cut from time to time in many cities. In textiles and oil-refinery one third of capa-
We travel from Gwongzhou back to
Hong Kong. For some tens of kilometers we can only see factories alongside the track. Twenty, thirty, forty... grouped in clusters. Between them the former ricefields are flattened by bulldozers.
The old couple sitting opposite us shake their heads: "This is not right."
In June, the minister for agriculture declared that the amount of farmland for summer grain harvests would be down by
167,500 hectares. Official economists have projected that this year land devoted to grain will be at least 1.33 million hectares less than in 1992. The comparable shortfall for cotton is 667 thousand heetares. The Spring of 1993 saw more than 200 peasant uprisings against local authorities.
### Besieged
These were not small skirmishes. In May in Renshou county, Szechuan, more than 10 thousand peasants besieged local authority buildings.
Whole villages have revolted against local rulers. People who have been unable to get out their money from local post offices break in and beat up personnel. Violent arguments over who owns what land and the intervention of the army to stop fights bear witness to the tensions.
The security police report about secret societies in the countryside and "feudalistic peasant empires" being established. In a speech in April, the chair of the National
Peoples' Congress, Qiao Shi cited the growing influence of a "peasant emperor" in
Hubei, a demobilised soldier from the
Peoples' Liberation Army.
Emergency meetings in Beijing have been frequent. It is still the countryside which is the economic base of China.
Thus, it is also the trampoline for "grow-
When the bureaucracy is accelerating its efforts to increase the gap between its own living standards and the majority;
when it is going wild in its search for fast money and capital for speculation; when it is searching for a way to become a ruling class "for real"; it is decisive that they lay their hands on an even larger part of the surplus from the countryside.
There is gold to be found in the pockets of the peasantry. Not because they are rich — on the contrary, they are the lowest of the low. But there are 800 million of them and they work.
People talk of "duke-economies" or 27
International Viewpoint #248 September 1993
"economic warlords" to describe the situation. The bureaucrats, from provincial level down to the village, do what they like, side stepping central government and higher authorities; fighting for spheres of influence against their colleagues.
These increasingly centrifugal forces
- fragmentation, the wave of speculation and the so-called growth - result in a lack of money. This is despite the fact that the amount of money in circulation has increased by 30% over the last three years. It has increased by over 50% in the first four months of this year alone according to government statistics — though figures in the press vary. All the same, the money has gone.
For the peasant this means:
• "White IOUs" - when the peasant sells rice or another crop to the state-buyer, the payment is no longer in yuan. The payment is a white piece of paper which says how much money it can be exchanged into "later". No interest, despite inflation of over 10 per cent.
• "Green IOUs" — millions decide to escape this treatment and go to the city to find a job. When they send any money they have earned home to the village the recipient will only get a green piece paper when they attempt to cash the postal cheque. "There is not enough money in this post office at the moment. We will pay the sum owed to you later." Again, no interest.
Other forms of robbery include:
• New taxes and fees are being imposed. The children's school, roads, fertiliser, tools, seeds... "in order to contribute towards the local build-up". That is, the bureaucrats local hotel projects or their purchases on the stockmarket in Hong Kong.
• Land is bought, forcibly or not, and is used for real estate projects. After this the peasant has nothing but their labour power to sell.
"I shall cut off the heads of those issuing "green" and "white IOUs", executive vice-premier Zhu Rongji shouted at an emergency meeting at the end of June. He had, at the same time, become the new chief for the scandal ridden central bank.
"Forty five different new fees which have been introduced locally are illegal and shall be immediately abolished", was the wording in another government statement. "Those who are guilty shall be punished! The taxation of the peasants must not exceed 5 per cent." This would be less than half what had been the practice in 1992.
Zhu Rongji will be starring in the coming power struggle after Deng.
His fight to re-shape the banking sys28 tem is a good example of his dilemma. At the beginning of July, in his new post at the central bank, he stated that 100 billion yuan which had been lent out illegally must be payed back by the local banks before August 15. One week before the deadline it was rumoured that the goal would not be achieved - and it will not.
But Zhu does not dare attack the leaders in the Special Economic Zones (SEZ), protégés of Deng Hsiao Ping, primary executives of the chaos to which the same Deng has lain the ground. Not one word has been said about putting the corrupt bank officials on trial.
However, the threats from the top have created new speculation that there could be, perhaps, a 180 degree turn. References to ancient emperors and their bad advisers in magazines in June were interpretated as hidden attacks on the capitalist road of Deng. There have also been some open attacks. Heart attacks and the flu amongst eighty-year old men are economic indicators in the financial press.
Clearly, the hierarchy is still in place even if its engine is not running very well. Perhaps there are only two main positions left: "do nothing" or "full panic"! How much real action would be unleashed by "full panic"?
In August, Beijing claimed that 1,000 out of 1,200 unofficial economic zones in the south, illegally opened by local bureaucrats, had been closed. The threat is to close more if they do not pass the government inspection.
### Lust for profit
At the beginning of August there were horrendous explosions and fires in the Shengzhen, heartland of Deng's reform policy. Fifteen workers were known to have been killed on 13 August. Many others were missing. For the first time local government spokespeople admitted that safety standards were inadequate. "The lust for profit was put before human life", the provincial Nanfang Daily said in a commentry. It added that the fire highlighted how industrial safety had been sacrificed in China's headlong rush for economic growth.
There is a Chinese saying: "Heaven thunders, and no rain." The "closures" will not be effective with anything less than a head-on attack on Deng's line. This is the line which first established the SEZs, tore down the monopoly on foreign trade and started the bureaucracy's fragmenting hunt for money and competition over the allocation of foreign investments. Thus, a prognosis is: those without "connections" must comply with the campaign and stay calm for a while. Those with better connections will continue more or less as
The threat from the top is kept alive.
But it never seriously challenges the fact that all the bureaucrats stand above the law and tend, more and more, to do what they like with "their" money — a "line" not without roots in a thousand year history.
The transformation - from bureaucrat to capitalist - must exist in many minds as a personal possibility. But how will it take place on a broad scale? The bureaucrat is, at the same time, a corrupted "helper", speculator, trader. As an individual fortune-seeker the bureaucrat devides and tears the market into small pieces. This is not a good basis for capitalism; rather a basis for "anti-feudalist" revolts... It is the connections upwards and sideways, the personal position in the bureaucratic network, in the "Party of princes", that is the asset of the party cadre. If the bureaucrat breaks loose from the hierarchy what then will they have to offer an American capitalist, any foreign investor searching for a good investment?
### Legitimacy
There is no serious opposition to the market reforms as such. The fear in the centre and the reaction among Party leaders stems more from the threat against what once gave the Party an important part of its legitimacy - perhaps the only legitimacy that remains: the Party unified mainland China and kept the huge nation toge-
Thus, market reforms, but in unity and with discipline? This is not easy. Who shall be criticised and attacked?
"The central leadership cannot deny that the major culprits of overheating the economy (are) the fast-growing number of corporations affiliated with senior cadres, military officers and their offspring", says one of many analysts in a choir.?
There are 100 thousand millionaires in yuan in China today. Some 10 thousand of these have the same family names as the veteran leaders of the Long March. Of course, they are one, two generations younger.
The son of Deng (in a wheelchair since the cultural revolution) has become a symbol for corruption through his transformation of the Chinese league for Disabled to a firm importing Japanese cars and fridges. The sons, and the sons of the sons of Deng are engaged in speculative business in Hong Kong.
2. South China Morning Post, June 23, 1993.
International Viewpoint #248 September 1993
But there are also other developments which could carry real capitalism into China.
In Hong Kong, Taiwan, Singapore and the whole of south east Asia - the Chinese bourgeoisie who fled China in 1949, and their sons and daughters have already started. They have been responsible for 75-80 percent of capital investment in mainland China during the last twelve months. In Indonesia the regime has complained about lost investments and the rich Chinese being disloyal, thinking too much of their homeland.
In May 1989, a nervous Li Peng came to the San Gong steel factory outside Beijing to give a speech. Leaflets from the Free Workers' Association were circulating: "We support the students fight against corruption, but we also demand.." Now the bureaucracy faces demands of a different kind. This "Capital Steelworks Ltd" has been introduced onto the Hong Kong Exchange together with eight other big state companies. It is investors who are now making demands - for increased profits.
### Bankruptcy
However, this is no longer alien to the bureaucracy. The bankruptcy law which has existed for some years has now started to be put into practice. In November of last year 3 thousand workers of a big textile factory in the south were fired and the bankruptcy was established by a court of law.
When the shares for a state industry have been introduced the majority have been sold to foreign concerns. Today, less than half of China's companies are state- owned. In the city of Wuhan a capitalist from Hong Kong was allowed to buy 51 per cent of the stocks in the Two Dyeing factory. Twelve hundred of the two thousand employed were fired. Workers younger than thirty-five could keep their job.
The working-day was increased from eight to ten hours.
In this way the pressure increases on the traditional urban working class. And to this is added the the mighty pressure of
100 million escaping from the economy in the countryside. The "iron ricebowl" — the nickname for the former safe stateemployment — is cracking up. Over 20 per cent of the workforce in state-owned company today can be contract workers.
But in their direct robbery the rulers in the cities seem to be a little more careful.
The "white" and "green IOUs" of the countryside have their city counterpart in the "red IOU". When wages are collected
20 per cent has been subtracted by the management for "investments". The difference however, is that the red paper promises interest and repayment by a fixed
All oppression in China seems at first sight to be unbroken. There are still thousands of political prisoners — authors and intellectuals - and hundreds of merciless death sentences are carried out publicly after arbitrary trials.
But there are some examples from Spring of this year that show the rulers are nervous in the face of mass protests.
In June over a thousand students at a university in Xian managed to stop a hated road project with their demonstrations.
In April the protests of students in the town of Loudi, Hunan, forced the police to release a popular professor from prison. He had been beaten up by the police on his way to work and then accused of violence against them. The court set him free with reference to "the riots in Beijing 1989" of which one should avoid a repetition.
In July, hundreds of workers went into several days of strike at a factory in Beijing. They were protesting against a transfer of their workplace following a part of the factory being privatised.
In all these cases the authorities have not dared to attack. They have negotiated.
But still: to stop collective action against its power the Party has waged decades of fragmenting war against the individual. In this way they connected the collective in the minds of the people with humiliation, stupidity, murder, torture, whipped-up mass psychosis, denunciation and treachery within the family and amongst the closest friends.
"The individual" Now "the individual" is celebrated
For the moment China is a continent where the new message of the bureaucracy
- about personal success and getting rich
- is hammered out through news and advertisements on television and other media. This has met with a broad response and creates hope. The mass of intellectuals presently see the course set by the Party as the starting point for democracy, rather than the mass movement. They hope that the Party will self-destruct because of its economic policy and yet at the same time, ironically enough, they believe the Party's uninterrupted propaganda about the USA and the "ideals of the west".
One can guess that the "get-rich-first"
schema will lead to many disappointments, exposing it as yet another propaganda campaign from rulers who refuse to go. The numerical increase in the working class that will be created by the drive for capitalism will need time to come together, in concrete organisational forms, before it can dig a grave big enough for this dictatorship. The monstrous and ludicrous rule of the bureaucracy - who try to say: "Socialism? It is us", just like the French king, Louis the XIV, who claimed: "I am the state" — is so transparently corrupt and discredited before the people that even a short period of economic disorder is felt as one provocation too many. The situation is extremely unstable.
Only revolutionary socialists who distance themselves completely from all the manners and symbols of the hated Party will have their contributions to the movement accepted by the masses. The Spring of 1989 showed how close the Chinese people are to unifying their forces. It can only be hoped that this will be the last campaign of the oppressors against the people. *
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