By Peter Main
China: Rise, Repression and Resistance, by Adrian Budd, Bookmarks, 2024, 254 pp, £10.00
This is a useful and informative book covering China’s development since the early 20th Century. In his introduction, the author, Adrian Budd, explains that it differs from much writing on China in that, ‘… it does not explore how Western business can benefit from the opportunities China offers. Nor does it echo the concerns of mainstream writers over the perceived threat China poses to Western values’.
He distances himself from a ‘dwindling number of people on the Left’ who still believe that China is a socialist state but also from those who ‘… argue that the system of economic planning and the role of state firms make China a non-capitalist or a transitional economy situated between capitalism and socialism’.
Budd’s own position is simply that of Tony Cliff, namely that after the victory over Chiang Kai-shek’s Guomindang in 1949, the Chinese Communist Party (CCP) established a state-capitalist regime, modelled on the Soviet Union. Cliff’s theory argued that, although there was no market competition through which the law of value could dominate the soviet economy, ‘international competition takes mainly a military form, the law of value expresses itself in its opposite, viz, a striving after use values’. Unfortunately, Budd carries over this theoretically incoherent scrambling of Marxist categories into his analysis of China, as we shall see.
A rather cursory first chapter deals with events from the early years of the last century, the politics of the Chinese Communist Party, CCP, the establishment of the People’s Republic of China in 1949, the zig zags of policy under Mao Zedong and the early ‘reform’ measures introduced by Deng Xiaoping after Mao’s death in 1976. These were, so to speak, the preparation for the much more dramatic changes introduced after 1992, a date whose significance will be seen later.
State capitalism and restoration
The second chapter covers the economic consequences of China’s dramatic transformation into the ‘workshop of the world’ after 1992 in much more detail, tracing the way in which internal developments interacted with international pressures. The combination of a huge migration from the countryside to entirely new cities in the coastal provinces, the reconfiguring of State Owned Enterprises into commercially oriented, and often privately owned, businesses and the influx of Foreign Direct Investment into Special Economic Zones, together allowed rates of exploitation that guaranteed profits while undercutting practically all other countries’ exports.
However, for Budd, no major change took place, merely a ‘sideways move from state-capitalism to a hybrid of state and private capital’. That is not to suggest he plays down the scale of the changes. He emphasises, for example, that some 60 million workers lost their jobs between 1995 (note the date) and 2005, that with those jobs they also lost guaranteed housing, education and health services.
At the same time, he records the huge population transfer from countryside to towns as perhaps 350 million peasants became wage-earners, proletarians in Marxist terms. The growth rates achieved, particularly after joining WTO in 2001, are of course well known and hardly need to be underlined.
For Budd, it seems, despite their enormity, these were all just superficial changes, nothing fundamental changed, this was just a ‘sideways move’. We disagree. After 1978 and Deng Xiaoping’s rise to power there certainly were ‘market reforms’, particularly in agriculture, that began to erode the bureaucratic planning system. We would regard these, and similar reforms affecting management rights in industry and the first experiments with Special Economic Zones, as ‘quantitative changes’ in the political economy of China.
However, in November 1992, after the Tiananmen Massacre and the bloody repression of the subsequent nationwide protests, and after witnessing the effects of the ‘big bang’ in Russia and Eastern Europe, the Congress of the CCP decided to dismantle the entire planning system and to combine privatisation and ‘corporatisation’ to ensure that ‘commercial standards’ would be enforced. Unlike in Russia, this dismantling would itself be planned to ensure stability of the regime.
The wholesale implementation of this programme essentially began in 1995, when the managers of State Owned Enterprises were empowered to sack everyone not employed productively on their ‘core business’. In practical terms, this meant that, for example, the managers of the Twentieth Century Steel Works, near Beijing, who had previously been responsible for a workforce of about 1 million providing housing, hospitals, public transport, education and other services in the city that surrounded the steelworks, could sack almost all of them.
The same thing happened across the whole industrial core of the economy. The previous system showed none of the characteristics of a capitalist economy; the new one enforced those characteristics with brutal efficiency. This was not a merely quantitative change, this was qualitative, it was the destruction of one set of property relations and the forcible imposition of a completely different set of property relations.
This was the restoration of capitalism and it promoted the development of a new capitalist class with the right to use the productive forces for the maximisation of profit. At the same time, however, the CCP’s strategy for restoring capitalism to China also maintained the bureaucratic regime through which it ruled. The roots of that regime were in what, following Trotsky, we have called the ‘bureaucratic caste’ whose origins lie in the pre-1949 ‘liberated zones’ but which really came to control China and Chinese society with the imposition of the planning system, copied from Soviet Russia, after 1952.
Class, party, and state
The power and ubiquity of the CCP is recognised by any commentator on China, Budd picks up the term ‘party-state’ used by Martin Hart-Landsberg (and others) to characterise it. As a journalistic turn of phrase that is understandable enough but for a Marxist it is at the very least a misleading collapse of two distinct categories into one amalgam. This is not a pedantic point; it matters because it implies that overthrow of the party would constitute the overthrow of the state and that is dangerously wrong.
When the CCP dismantled the planned economy and restored capitalism, it created the basis for a conflict of interests between the bureaucratic caste upon which it was based and the new capitalist class whose growth it had initiated. From being parasitic on the planned economy it was bound to become parasitic on the capitalists’ economy.
For the first couple of decades after restoration, however, there was little tension between caste and class. Although horizontal, integrated planning had been dismantled, the new corporations and state trusts still needed administrators and officials and the vast network of provincial and local government still played a central role in ‘managing’ the rapid economic development that soon took off. For the nascent class of capitalists, long standing connections were financially advantageous and the party regime ensured relative social order in which to do business.
Over time, however, the relationship has to change. On the one hand, the capitalists are becoming stronger and more experienced, more conscious of their specific, and varying, interests, while, on the other, the caste tends towards disintegration as many become capitalists themselves and even those who remain in post increasingly identify with ‘their’ region, industry or profession rather than the central state. One consequence of this, to varying degrees, is the reflection of these disparate interests within the party itself.
The fruits of accumulation
The almost unprecedented rates of growth in the early years of the century came to an end with the global financial crisis of 2008. Surprisingly, Budd does not refer to the wafer thin profit rates of 2007–8 that resulted from cut-throat competition between Chinese exporters themselves once they had effectively driven the competition out of business.
He does, however, deal with the consequences of the huge stimulus programme with which Beijing tried to restore equilibrium. Much of the $570 billion package went into infrastructure and fixed capital investment and on a scale that even pulled some other countries out of recession. In addition, he points to the much less publicised instruction to banks to lend to local government, suggesting this amounted to three times as much as the central funding and, in time, contributed to the local government debt crisis that shows no sign of resolution even now.
The second decade of the century saw the emergence of the characteristic problems of rapid capitalist growth; over-accumulation of capital, falling rates of profit, stock exchange booms and busts and indebtedness on a scale that could bankrupt some of the biggest corporations, the most publicised of which was Evergrande. This was also the decade that saw the rise of Xi Jinping and the initiation of the Belt and Road Initiative as China began to project its strength internationally to secure its markets, its raw materials and its access to energy sources. All of this is presented clearly and supported by copious footnoting for those who want to see the original sources.
China’s growth into a major global player necessarily brought with it any number of new problems both domestic and foreign, not least the differing and, very often, diverging, interests and priorities of different sectors of the economy. These include the tension between the state owned industries and the newer, often privately owned, industries of the south and coastal provinces; between those provinces and the much less developed interior and between export-oriented and domestic market oriented corporations, not to mention the international context, exemplified by Barack Obama’s ‘Pivot to the Pacific’.
Chapter 3 deals with the responses to these developing differences in the context of what it calls, ‘Xi’s political project’. That is more precisely defined as ‘the party-state’s project to preserve the power of the state-capitalist ruling class’ (p69). So, following Cliff’s model, we now have a party which is also a capitalist state, or, perhaps, a capitalist state that is also a party, fighting to preserve its power against another class of capitalists. The conflation of party and state, two quite separate categories in Marxist analysis, serves only to confuse the picture. It would be more accurate to recognise that the party, which controls the state apparatus, has begun to lose its social basis, that process is still far from complete but it explains why Xi Jinping has had to impose an ever more repressive regime on his own party.
Resistance
Budd does point to the increasing numbers of tensions and conflicts and rightly sees them as the real reason for Xi Jinping’s increasingly authoritarian rule, not his own personality as many commentators would have it. In this chapter, authoritarian repression is dealt with at the level of the regime itself, including the removal of any limit on Xi’s term of office, changes in the internal organisation of the party, re-assertion of its right to control all social activities and repeated crackdowns on corruption within its own ranks.
Subsequent chapters deal with the ‘party-state’ responses to pressure and discontent from outside of the regime; from the working class; the socially oppressed and from imperialist rivals. Readers will find those dealing with the domestic issues a very useful source of information, culled from websites, academic papers and specialised journals, not easily available to most people.
For example, the scale of strikes and workers’ protests in the period up to 2015 will surprise many whose image of the Chinese working class is of vast ranks of docile assembly line workers. Budd cites one Beijing academic survey that reported an average of 483 strikes, per day, in 2010, to support his conclusion that increasing numbers of strikes and protests in the previous ten years or so had ‘served to embolden the workers’.
In addition, there is some consideration not only of how the strike wave showed signs of developing organisational ability but also the difficulties and complexities of relating to the official trades unions. In keeping with the character of the book as essentially a narrative, not an analysis, however, there is no attempt to draw any conclusions or to draw on the experience of other workers under severe repression.
Perhaps the author is wary of appearing in any way condescending, a healthy instinct certainly but actually misplaced; comrades in China are interested in foreign insights and experience and can access ‘Western’ literature.
Budd’s book will be read in China, as will this review, and internationalists have an obligation to think internationally and not assume they have to restrict their ideas and arguments to their own borders.
Imperialism
The chapter on China’s place in the world gets straight to the point; ‘China’s state-capitalism is embedded in a global system of inter-imperialist rivalry’. Budd, quite rightly, rejects arguments, such as those of Michael Roberts, that because its ways of exploiting other countries are not the same as those of the longer established imperialisms, it somehow does not qualify as imperialist.
That clarity is perhaps rather blurred by the adoption of Au Loong-yu’s formula of ‘an emergent imperialist power, a very strong regional power with a global reach … but has not yet consolidated its position in the world’. Do the ‘emergent’ and the ‘not yet’ in some way qualify the definition? It is not clear, but the possibility of a direct clash with an established imperialist power is very real and it should be made clear that revolutionaries would be defeatist on both sides were that to happen.
Much of the rest of the chapter is concerned with charting China’s changing relationships, particularly with the USA, as the country grew and strengthened. There is a quite detailed account of the Belt and Road Initiative which combines the evidence for the imperialistic character of the initiative with rejection of ‘Western’ attempts to exaggerate its scale by comparing the value of its various projects with those of the established imperialisms.
The likelihood of a ‘hot war’ with the USA, for example over Taiwan, is downplayed, and a literal equation of current rivalry with the Cold War with the USSR rejected. Equally, a consideration of the threat of ‘decoupling’ of the economic links built up over the last 30 years concludes that this is most unlikely. As against those who interpret China’s rivalry with the USA as some kind of positive alternative, opposition is made clear: ‘The two sides are far from equal, but the world’s second most powerful imperialism does not provide a progressive alternative’.
Results and prospects
The final chapter, entitled ‘Prospects for Change’ summarises the changes that have taken place and stresses, correctly, that capitalist development inevitably brings its own problems, not least slowing growth rates at home and economic retaliation from abroad. Popular discontent and unrest is also a product of the changes and mobilisations like the mass ‘break out’ from Foxconn’s giant complex in 2022 and the anti-lockdown protests in many cities, including Shanghai and Beijing, exemplify this.
To combat this, it is predicted that the rulers will try to divide opponents by nationality, religion, sexuality and any other potential differences and certainly will not shrink from the harshest repression. However, ‘… the scale of the coming crisis is likely to force millions into a new wave of protest and struggle with the potential to break down the differences and unite the masses around their common interests’ (p198).
Such a wave is, indeed, likely, even probable but, as Budd goes on to point out, such potential can disappear as quickly as it appears if it is not embodied in organisation-—his answer? The need for a revolutionary socialist party, even though building one will be a ‘daunting task’. That is all very well but he has nothing to say about how that task, the essential task, is to be fulfilled.
The most fundamental principle for building such a party is surely the need for the complete political independence of the working class, and Budd would surely agree with that. Given his prediction of a ‘wave of mass protest’, surely he should also learn from the experience of other such waves, most recently the Arab Spring or the Sudanese revolution, that basic democratic demands can also be taken up by bourgeois or petty bourgeois forces who then lead the movement to ultimate defeat. Earlier, he has already dismissed the long touted idea that, ‘the corporate elite will ultimately challenge CCP rule’ on the grounds that the ‘economic and political elites overlap’ and that is very probably true. But what about those lower down the pecking order, the heads of firms whose growth is stunted by party policies, the professionals whose careers are blighted by party dogma and censorship and the academics whose studies make clear to them that the party is a barrier to progress?
All such people, of whom there are millions, know perfectly well that it is party policy that has caused the current economic malaise centred on real estate speculation and the construction industry and that Xi’s answer of concentrating on high tech industries is not going to resolve it. These are the social forces that could provide the initial basis for bourgeois or petty bourgeois parties, or even splits from the party, to emerge and gain leadership of the ‘democratic movement’.
To combat that danger, revolutionaries have to know in advance that their priority will be to use the context of the crisis to build working class organisations, democratically controlled, in the workplaces and the communities. They need to have prepared an action programme of demands, centred on workers’ control, to campaign for in addition to democratic demands and, when necessary, against the liberals and the petty bourgeois. Central to their strategy has to be an understanding that breaking the power of the party is only the start of what is needed, the goal is the quite separate task of mobilising the workers’ organisations to overthrow the state and establish their own rule.
Here and now, developing that programme and winning the most committed comrades to it, is the task of activists, many of whom have already felt the repression when they tried to support workers’ protests and are now discussing the lessons and the way forward. Budd does point to the experience of the Russian Revolution to prove his point that a party is needed, quite right, but the reference point at the moment is what the Russian revolutionaries did long before 1917. In China, we are closer to the small-scale and clandestine propaganda and training groups, which codified the programme upon which the Bolshevik party was based, than to the mass-based revolutionary party of 1917.
