How to apply “scientific socialism” to a market that does not regulate itself
China is an infinitely complex country, where poverty coexists with the most daring and sophisticated demonstrations of progress. But, the author states, despite its historical violent lurches, the CCP is spearheading a peerless economic and social experiment.
(From Santiago de Chile) CHINESE AUTHORITIES are alarmed by the growing social gap and deterioration of the environment. To my great surprise, Liu Yun Shan, a member of the Political Bureau of the Chinese Communist Party (CCP), and one of the 25 most powerful men in an hierarchy that oversees 70 million militants, rejects the idea that the current global economic crisis is having serious effects on his country.
On the contrary, he points out that there is optimism, since they have had excellent harvests for the fifth consecutive year. This is an issue of paramount importance when it comes to feeding the largest population on earth. The statements made by Liu, who is the head of the CCP’s propaganda apparatus, affirm that today the urgencies have gone from being in the city to the countryside: The number one priority is to treat the peasantry justly and he warns that when it comes to food security, we need to fend for ourselves. If we have problems, we know that no one can help us. The current concern for the 950 million peasants -of which 150 million are recent immigrants from the countryside to the city- goes far beyond agricultural production.
WAITING FOR PROSPERITY
During the last 30 years, China has applied, with overwhelming success, the policy of Liberalization and Reform initiated by Deng Xiaoping. After the debacle of the Great Proletarian Cultural Revolution, which in fact paralyzed the country for a decade (beginning in 1966), the country veered from virulent leftist extremism towards uncontrolled economic liberalization policies. By introducing a model in 1979 that drastically transformed China, Deng ushered in a new economic era.
“It is estimated that of China’s 1.3 billion inhabitants, slightly more than 400 million have lifted their heads above the poverty line” The country began to experience double digit growth, which has produced what many analysts consider to be the most dizzying accumulation of wealth in the history of humanity. Who would be able to think that in the austere China of Mao Tse Tung someone would be able to proclaim, as Deng did, that getting rich is a glorious thing. His absolute pragmatism was made obvious when he declared: I don’t care if it’s a white cat or a black cat. It’s a good cat so long as it catches mice. In other words, ideologies are not important, but rather results; and results are in sight in this formerly destitute country that already has the fourth largest Gross Domestic Product in the world, and if the current trend continues, will reach first place within a few decades.
The gamble taken by Deng -and his successor Jiang Zemin- was to grow as quickly as possible, and in that way lift legions of compatriots out of poverty. That’s the bright side, but there is also a dark side: the growing gap between those that have already tasted glory and those that are still hoping to do so. China’s statistics are debatable, but it is estimated that of its 1.3 billion inhabitants, slightly more than 400 million have lifted their heads above the poverty line. The rest, who inhabit the fields in the interior of the country, are waiting more and more restlessly for the benefits of the boom.
CLEAR RURAL DISCONTENT
If you are seeking an image that captures what is happening in China, well Wang Chen, the minister of the Information Office of the State Counsel, has found a very stark one: “The discontent in the countryside is clear, and the growing number of clashes between police and peasants attests to this” Some of our cities exhibit a European wealth, and certain rural areas, an African poverty. Concerning the matter, I asked him if he did not consider it difficult to grasp that, in a country that claims to be socialist, there is an abundance of boutiques that sell superfluous luxury items for what would amount to ten years of a peasant’s salary. Wang replied without hesitation: Yes, it is a problem and the Chinese Government has taken note of it. We do not seek a completely egalitarian society since such a society would lack vigor. But the Government is taking measures to improve the distribution of wealth. It has raised taxes and has already initiated a series of salary increases. In some cases, investigations into how some fortunes were amassed are being carried out. We know that in numerous cases our laws were broken.
The discontent in the countryside is clear, and the growing number of clashes between police and peasants attests to this. “China aspires to have the world’s largest railroad network, and it already has the second most extensive highway network on the planet” Health care is almost nonexistent in rural areas and education is very deficient. In a certain way, the situation caused by the global economic crisis favors the Government’s reform plans: the decline in international demand forces industries to find new markets, and what could be better than the neglected areas of one’s own country?
Along with this, the government is expected to inject money into and create employment through massive public works programs. One example is the construction of about twenty metro lines in both Beijing and Shanghai that will double the respective surface areas of the existing networks. China aspires to have the world’s largest railroad network; plans to develop high speed lines are in the works; and it already has the second most extensive highway network on the planet. To maintain our economic vitality, we cannot fall below a growth rate of eight percent, Wang estimates, and that goal must be met through commerce as well as foreign and domestic investment.
URGENT AGRICULTURE REFORM
The cost that China is willing to pay for its development is unnerving. “In order to introduce reform in agriculture, the CCP has just granted to those farmers who desire it the right to transfer their exploitation contracts to third parties” An example: every year, fifteen thousand coal workers die in industrial accidents. Wang responds that my figures are outdated since last year ten thousand died. I know -he hurries to clarify- that that is still too many but it is difficult to control what occurs in small and medium-sized mines. There is a plan to definitively close 2,500 of them in upcoming years. But all of the figures in China are very high. The one hundred thousand people that die every year in highway accidents worry me greatly as well.
One of the options for improving living conditions in the countryside is to reorganize the structure of the agrarian society. In China, there is no private property on land that belongs to the State in its entirety; what does exist is the right to the produce grown on such land. For that, farmers sign contracts that guarantee them a certain number of years of exploitation of the plots. In order to increase productivity, more modern methods and more efficient economies of scale than those currently in use are often required.
In order to introduce reform in agriculture, the CCP has just granted to those farmers who desire it the right to transfer their exploitation contracts to third parties; this, the authorities already know, will provoke a significant migratory wave to the cities: therefore, they have made residence permits in small and medium-sized cities easier to obtain. “One of the consequences of higher salaries and better supervision of workers’ rights will be a relative loss of the competitiveness of the Chinese workforce”
In the past, rural immigrants have received embarrassing deals. Many live in the constructions or factories where they work under destitute conditions, and their rights are often unknown by their own employers. In order to change the outlook, the CCP has revived unions and is today urging them to play a leading role in the defense of workers, and especially in the defense of the immigrant farmers that Xi Jinping, vice president of the Federation of National Unions, states have given a new strength to the Chinese working class. Some 66 million rural immigrants are unionized. Currently, the unions have at their disposal 6,178 legal council consultancies that have been active in 29 thousand labor disputes this past year.
One of the consequences of higher salaries and better supervision of workers’ rights will be a relative loss of the competitiveness of the Chinese workforce, up until now one of the cheapest and most efficient in the world. This is one more reason to stimulate the domestic market and enter into the virtuous circle of greater demand stimulated by better living conditions.
THE SOCIAL GAP AND ENVIRONMENTAL DAMAGE
Chinese leaders look with horror at what happened to the Soviet Union, which, we must not forget, was one day their model. “In the current Chinese version, scientific socialism alludes to controlling market forces” Today, they seek to build a type of socialism from an empirical perspective, basing it in that which yields results, and without letting themselves get carried away by ideological outbursts. In the words of Hu Weiping, director of the Information Office of the State Counsel, you have to cross the river by stepping on stones. They synthesize this idea in what they call scientific socialism. Those who are familiar with the writings of Karl Marx know that this concept was used to differentiate his socialism from the socialism of people like Robert Owens and others, which was classified as Utopian, messianic and philanthropic.
Marx believed that workers’ achievements could come only from their struggles, and not from the generosity or understanding of their employers. In the current Chinese version, scientific socialism alludes to controlling market forces that, in addition to generating wealth, have created a social gap and caused an incredible amount of damage to the environment. In short, the market, as has been repeated so often in recent months, does not regulate itself. “China’s rulers were slow to realize that, when nature is harmed, the bread of today turns into the hunger of tomorrow” The CCP wants to put an end to the rampant development that has left many in the dust. Therefore, at its last meeting, the Central Committee adopted a series of measures to improve the peasants’ luck and put a cap on those fortunes that are judged to be excessive.
Then there is also the concern over the dramatic deterioration of the environment. The authorities admit to having made a great mistake in this last area: having permitted deforestation without fear. It has provoked, as it has all around the world, erosion and a drastic increase in floods. In order to reverse the situation, a program of reforestation is under way, which involves a greater sacrifice in a country with such a high population density and such a shortage of arable lands. The second great concern is taking care of its water, for which costly programs to decontaminate lakes and rivers have already been begun. Also, with regards to air pollution, the Chinese are headed down a well-known road: in Beijing, measures to reduce the volume of vehicles by 20 percent every day have begun, and Shanghai has adopted measures along the same line. China’s rulers were slow to realize that, when nature is harmed, the bread of today turns into the hunger of tomorrow.
The Chinese communists are working hard to apply scientific socialism, which specifically means regulating a market that has upset the balance of social structures and destroyed indispensable natural resources.
According to Wang Zhongwei of the Permanent Committee of the CCP in Shanghai, absolute pragmatism is on the decline: Those most able must be allowed to get rich and protect the poorest people. I asked him if this was not an admission of the idea that the social gap had come to socialist China to stay, to which he vehemently replied: social justice must precede efficiency.
China does not only have five thousand years of history -something that its inhabits never get tired of recalling- but it is also a country of infinite complexity, where poverty coexists with the most daring and sophisticated demonstrations of progress. Despite its historical violent and painful, the Chinese communists are spearheading a breathtaking economic and social experiment.