China in transition
International Viewpoint #260 October 1994
IN HIS second article, LIVIO
MAITAN argues that an analysis of the Chinese experience is important in helping Marxists understand what is happening in the former Soviet
Union and
Eastern Europe.
Tidier 14
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### CHINA
OR MANY decades, the problem of transition was approached through a socialist perspective. According to the more radical critiques, it could not be successfully carried out without a rupture of the mechanisms and institutional instruments of the existing bureaucratic societies (a "political revolution" in the eyes of revolutionary Marxists, a "cultural revolution" according to the apologetic versions of left Maoism). Today, the question posed is by what means and by what ideological formulations it would be possible to restore capitalism. Even those political currents which oppose the openly pro-capitalist governments, and which originate from the former Com-
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munist parties, do not wholly reject the past, accepting the idea that a stage of "market economy" and privatisation is not only inevitable, but desirable. Yet in China political power remains in the hands of what could be called the central political bureaucracy, through the mechanisms of control and hegemony specific to the party state; official ideology affirms the construction of socialism as the final objective; and the former leaders of the Soviet Union are reproached for not having defended the socialist state, either by maintaining the existing institutional framework, or by the timely adoption of more radical reforms. Precisely because of its specificity, analysis of the Chinese experience is of major importance, not only to aid our understanding of the tendencies at work in the former Soviet Union and the countries of Eastern Europe and our knowledge of whether these tendencies could be reversed, but also to help us assess the world situation.
### Opposed
Basically, two diametrically opposed hypotheses have ben advanced, which have according to the first, the processes unleashed will gradually lead to the restoration of capitalism, while according to the second, the Chinese road will allow, for the first time a positive response to the problems posed by the tormented transition from capitalism to socialism. Neither of these two interpretations is correct. In relation to the first interpretation, the experience in the former USSR, and Poland confirms that obstacles of an economic (both structural and conjunctural), socio-political and ethno-cultural nature, hinder the concretisation of "restorationist projects". It is not a question of simply replacing the governments and political mechanisms of "actually existing socialism" by supposedly democratic governments which support a "market economy" and to some degree consults the electors. It amounts rather to establishing fundamentally different structures, economic mechanisms, relations of production and property. Moreover, it is necessary to create bourgeois social layers capable of substituting themselves for the bureaucratic layers which ran the previous regi-
International Viewpoint #260 October 1994 me. It goes without saying that these tasks are extremely difficult, and cannot be accomplished simply through the conversion of former managers and members of the nomenklatura into capitalists. At the level of the masses, the moral and political rejection of the bureaucratic establishment is undoubtedly linked to generalised illusions about the free market and private initiative. But the reality of the backwards transition has quite rapidly dissipated these; the great majority of the population has experienced increasingly serious diffculties in everyday life and old woes such as unemployment, poverty an hunger have re-appeared on a wide scale while only the narrow layers of the privileged have benefited from the new order. In addition, the new regimes have had to face a world economic situation of prolonged stagnation, generating contradictions and difficulties which can only fall on the masses, the more so in that the hoped for "aid" and investment has not materialized. It is hardly astonishing in these circumstances that in the past year tendencies which seek to rehabilitate the past have strengthened themselves in a number of countries. It seems obvious that these obstacles, above all those of a structural nature, exist in China, but there are also specific factors.
New course
In the first place, the new course followed by the Chinese took shape in an economic context quite different to that of the former USSR and its satellite countries in the course of the 1980s.!
Secondly, international capitalism, reassured by the relative stability of the country and its economy, has realised more investment projects, loans and commercial agreements than in the former Soviet Union or other countries. It is very probable that this attitude will be maintained in the coming years, given the need for capitalists to assure new markets. After all, even modest percentages of market share represent considerable value in such an enormous coun try.
In the third place, the formation of a bourgeois or neo-bourgeois social layer could be facilitated by the rehabilitation of the former bourgeoisie, never completely destroyed, by the influence of Hong Kong, which will soon be reintegrated into the People's Republic, and by the existence of a solid bourgeoisie of Chinese origin which plays an economic role of the first rank in several Asian countries, such as Indonesia and Malaysia, and which seems ready to enter the game. These factors, above all the first two, have effectively contributed to the realization of the new course. However, it does no follow automatically from this that a gradual and "peaceful" restoration of capitalism is on the agenda. The private sector, both national and foreign, still has a very limited weight, and one could say the same thing in relation to the bourgeois embryos; the Chinese bourgeoisie abroad can contribute capital and knowledge but due to its relative weakness as its exteriority, it will not be able to play a decisive role in the transformation of structural relations and still less in the conquest of political hegemony. No comparison is possible with Germany where, despite a completely different relationship of forces and other favourable conditions, the structural assimilation of the former GDR has come up against much greater difficulties than were foreseen. Nor should one underestimate the fact that the process which has developed until now and which is far from representing a restoration of capitalism, has experienced bottle-necks, conflictural tensions and grave contradictions in different ares; all;these tendencies could lead to veritable explosions on the political and social level. last but not least, it is the greater stability of the existing system and greater solidity of the dominant bureaucratic layer which aggravates the more strictly struc tural problems.
### Evolution
The second thesis, according to which the reformist choice could in the long term support a physiological evolution towards socialism, is based upon the following factors: (i) the relative stability of the political framework (State armed forces, and so forth) under the centralised party; (ii) the expanding economy and the fact that the political regime can make its choices within the framework of an economic plan; (iii) the ethnic cohesion of a country where there are no centrifugal forces comparable to those which tore apart the USSR and Yugoslavia; (iv) despite the vicissitudes of the 1960s and 1970s, the greater continuity of the ruling group which allows a generational shift without enormous traumas. There are also other factors, which will have a still greater significance in the future.
Firstly, it should not be forgotten that the agricultural economy, which remains predominant, is not organised on a collective basis, nor even on the basis of co-operatives. 200 million families own on average 0.7 ha — and this represents "the biggest obstacle to progress" in the countryside where "such a set-up cannot meet the needs of modern farming". (China Daily, 2 November 1993) At the same time, it favours, at least tendentially, an accumulation of the capitalist type, and so there is possibility for conflict.
Secondly, large-scale state-owned industry continues to be considered as the "pillar of the industry". However, it is currently less dynamic than the private sector. A high percentage of enterprises are in deficit and could be subject to restructurings, indeed in part to privatisation. More generally, integration in the international economy will increasingly affect (whether directly or indirectly) the industrial and tertiary sectors. For example, at the time of the measures adopted in the summer of 1993, the Chinese leaders first took care to consult the World Bank.
### Content
Thirdly, the planned economy is increasingly being emptied of its content; it less and less constitutes a counterweight to the tendencies stimulated by the existence of the private sector, the dynamic of a non-collectivist agricultural economy and the mechanisms of the market. For the past year or so official texts have spoken increasingly explicitly of the transcendence or suppression of the planned economy. In November 1993 and important text from the Party central committee, while not overstating its case, redefined the significance ot planning, explaining that plans must be based upon the market limited to fixing the broad lines of intervention and rest essentially on the interventions of the central bank and fiscal
While revolutionary Marxists have never denied that the market has a role to play in a phase of post-capitalist transition, there is still the question of whether or not decisive choices are dictated by the market. If the orientations which have been already sketched out are accentuated as seems to be intended, the
1. The Chinese abroad total 55 million. But their specific economic weight is enormously greater than their percentage of the population of the different countries concerned (for example, in Thailand, they represent eight percent of the population, but control eighty percent of commercial capital and half of the banks). Their economic "conglomerates" function as multinationals at the Asian level.
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China in transition
International Viewpoint #260 October 1994
Chinese economy will not go in the second direction. Further there is also a progressive erosion in the State monopoly on foreign trade, despite the fact that this monopoly should constitute an essential protective measure so long as the world market remains dominated by the imperatives of capitalist accumulation.
### Tibet
Moreover, while the national questions do not have the same significance as in other countries (the fifty-five national minorities represent no more than eight percent of the total population), there remains the problem of Tibet which has persisted, with its chronic tensions and conflicts, since immediately after the revolutionary victory. Problems have also emerged in relation to other nationalities; for example, serious conflicts took place last year with the Moslem community in Qinghai. Independently of the national questions, there are also other, often vigorously denounced tendencies. These tendencies operate on the provincial level (many provinces have populations larger than those of the larger Western European countries); internal protective barriers have been established, investment is stimulated in some provinces to the detriment of others, decisions adopted by the Beijing government remain unimplemented, and so forth. One notable point of discord has been income tax. In 1978 the share going to the State corresponded to thirty-four percent of GNP; this was down to fifteen percent by 1992 and has since fallen again. It is too soon to say if the recent tax reforms have succeeded in restoring order. 30.
Finally, the State and Party apparatus is changing. It bears little resemblance to its incarnation during the revolution and the first years following victory; new recruits are far from being the same as their predecessors. The army is no longer immune from the tendencies at work in society as a whole and the traditions of the Long March are now hazy.
It is worth recalling that the army manages autonomously vast and profitable economic sectors in, as stated, a context where a symbiosis is taking place between sectors of the political and technocratic bureaucracy and embryonic bourgeois layers, and where there are growing international links
Dynamics
In conclusion, the conflictual tensions at work, in different forms, with different intensities and dynamics, throughout the history of post-revolutionary China have seriously deepened throughout the past fifteen years. The more traditional tensions and contradictions intertwine with the new ones resulting from transformations already carried out or planned. Chinese leaders and commentators are aware of this dynamic. Grave worries had already been expressed before the explosion of 1989, and recently voices have once more been raised. For example, a report to a seminar of the institute of sociology in Beijing had the following to say: "Despite the rapid economic growth and social development, experts predicted problems, which might lead to disorder. One potential challenge to social stability next year is likely to come from the effects of the separation of central and local government taxes... Other social problems likely to arise in the coming year include the widening income gap in different economic sectors, social problems in the under-developed western areas and increase in crime... While the economy and society maintained a vigorous development, all kinds of conflicts and problems have accumulated and intensified." (China Daily, 2 November
Are these merely tendentious formations seeking to justify certain decisions and above all the persistent refusal to adopt measures of democratisation at the political level? Possibly, but these worries have a certain foundation.
### Exodus
Inasmuch as there is a gigantic rural exodus, which will get worse, without any solution being apparent in the short to medium term; inasmuch as growing disequilibria are emerging between different agricultural sectors which the enlarging of the "market economy" can only aggravate; inasmuch as the gap grows between rich peasants, local bureaucrats, and broad layers of peasants on the road to pauperisation; inasmuch as the structural framework itself - that is the preponderance of family-managed businesses — represents a substantial obstacle to any real modernisation and to the growth of the necessary production to satisfy the food needs of the population without having recourse to massive imports whose consequences for the balance of payments are known, how could one not worry about the situation in the countryside?
There is no need to dwell here on the situation of bankruptcy in which a high percentage of big state firms find themselves, or on the uncontrolled growth of regions which are in the vanguard of privatisations and the expansion of joint ventures, with all sorts of social and economic tensions. Urban and industrial unemployment, which is of a dimension comparable to that of the rural exodus, will also lead to disequilibria, conflictual situations and phenomena of disintegration. More generally, the "liberalisation" or further extension of the "laws of the market" will inevitably have negative effects on the living conditions of broad layers of the population; it is enough to
International Viewpoint #260 October 1994 recall the key problem of housing. The layers which will be the victims of growing inequalities which the official ideology, far from condemning, presents as inevitable, indeed, desirable, are still less likely to accept such a state of things inasmuch as the last few years have nourished a consumer society psychology.2
All this potential for conflict piles up in a political context which has not fundamentally changed. Social pressures • will have a tendency to concretise price increases, the housing crisis, the insufficiency of wages, and so forth, will express their discontent, advancing their own demands and having recourse to spontaneous mobilisations, indeed outright riots. For their part, the bourgeois layers in formation and the middle layers will seek to suppress the obstacles to their further growth and the augmentation of their specific socio-political weight, which are represented, in the final analysis, by the existence of non-capitalist relations of production and property and by the maintenance of the post-revolutionary hegemonic political apparatuses. Keeping a due sense of proportion, China could be marked by the contradiction which lay at the root of the crisis of the USSR in the 1980s; the contradiction between a civil society which has, despite all, ripened and become more demanding, and archaic and sclerotic political structures. If this will be no physiological development of a social dialectic which opens the road to the construction of socialism and wrenching conflicts, capable of provoking new repressive and authoritarian interventions, will inevitably develop.
### Reformist
It is in this context that the bureaucracy, in its diverse structures and outside of any reformist operations, will try in its own manner and with its own methods (that is to say with the defence of its own interests as the priority) to maintain the role that it attributes to itself, that of the element of necessary cohesion in a complex and tormented society.
This bureaucracy has the same roots as the dominant layers of other post-revolutionary societies formed after the two world wars. But an ancient tradition has exercised and continues to exercise an influence on the behaviour and ideological dynamic which it adopts.3
Without abusing historical analogies, nor forgetting that any fundamental political and sociological characterisation must base itself on the mode of production and the relations of property, we will recall that one of the most lucid historians of China, Etienne Balazs, has written in a series of essays under the title of the 'Celestial Bureaucracy' (Gallimard, Paris, 1968): "In the last analysis, the originality of China consists in having created a form of monocratic regime where the civil bureaucracy of lettered civil servants, as a social group, clearly dominates the State... Each episode of Chinese history bears witness to it: without the civil servants to hold the feudals, to maintain with a grip of steel the unity of the empire, particularities would have carried the day and, with the division of sovereignty, the whole of Chinese civilisation would have shattered... And then - without exception — the alternative to the reign of the bureaucracy, in peasant China, was disorder... Many traits of People's China recall the old imperial regime; the primacy of the State and the class of privileged functionaries — in this perspective the Party bureaucracy would be the substitute for the mandarinate: the importance of public works carried out by millions of coolies; the constant surveillance by the police; the intolerance of an enlightened but totalitarian absolutism, with its paternalist side, its sentiment of superiority, its conceit and its pride; and finally. the importance of the individual, incapable of escaping the social pressure of the collectivity and its conformism... It is the Statism and the absolute power of a bureaucracy which seems to constitute the real common denominator of the old and the new regime in China." (pp 32,
Today, while Balazs would rectify some expressions, the substance is the same: no qualitative change in the direction of socialist democracy has been introduced. Moreover, if the new orientation leads to an emergence from the national isolation of the policy of self-sufficiency, this is being achieved through a partial integration in the mechanisms of the world capitalist economy and not by the conquest of a supranational dimension of capitalism. In synthesis, this is the impasse in which China today finds itself. *
2. The director Ning Ying has said in an interview: "In some ways, it is obvious that consumption brings pleasure and that everybody is happy to be able to buy things. But in other ways, it is tragic; a whole culture is in the process of disappearing and, in exchange, we are importing western models without discrimination." (L'Unita, 13 November 1993)
3. It seems that one of Mao's favourite pieces of reading material was a kind of political manual for the imperial bureaucracy, The Universal Mirror of History, written in the 11th or 12th century by Sima Guang.
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Number 2, July-September 1994
•The South African transition by Jeremy Cronin
•Winning democracy in
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# The "New World Order"
by Alejandro Bendana
• Russia: From crisis to catastrophe by Boris Kargarlitsky
• Gender and citizenship in
East Central Europe by Barbara Eihorn
• Resurgence of the Filipino left interview with Francisco Nemenzo
• Elections in Eastern Europe by Tamás Krausz
• The New Zealand Alliance by Keith Locke
• Special FSLN conference by Stephen Marks
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