China’s Contradictions

Oct 19, 2009 Editorial

At the beginning of this month, the People’s Republic of China celebrated its sixtieth anniversary. After the Red Army under Mao Tse-tung had taken over the vast country in 1949, very few could have conceived the present status of the most populous nation in the world.

One of Mao’s famous contributions to Marxist analysis was his stress on the nature of “contradictions”. “The law of contradiction in things,” he assured us, “that is, the law of the unity of opposites, is the fundamental law of nature and of society.”

Modern day China is certainly a study in contradictions but probably not in the way the Chairman theorised.

The most glaring contradiction goes to the heart of the raison d’etre of the Chinese state itself – the “relations of production”.

While the state stubbornly declares itself to be communist, it has created the most vibrant capitalist economy in the world, which is firmly on course to supplant the US as the largest economy later this century. Communist ideology, of course, demands that the state own the means of production “on behalf of the people”.

Another contradiction that has emerged from this state of affairs is the number of Communist party officials and their families- not the state – that have ownership of these capitalist corporations.

A 2007 finding by the State Council of the Academy of Social Sciences and the Party’s Central University showed that of the 3,320 Chinese citizens with a personal wealth of 100 million yuan or about US$14 million, 2,932 were children of high-ranking Party officials.

Currently about one-third of the private entrepreneurs are members of the Party (including “xiahai” entrepreneurs who are former officials); membership helps them get state finance and more protection and legitimacy.

The success of the capitalistic domestic economy has created several contradictions in the international arena. China’s largest customer for its burgeoning factories is the US – the bastion of world capitalism – and one that had vowed to defeat world communism during the heyday of the Cold War.

Yet the US’s insatiable appetite for Chinese goods has fuelled the highest and most prolonged growth of GDP (Chinese) in the history of the world, catapulting China to the forefront of the nations of the world.

China’s appetite for raw materials to feed the maws of its factories has also forced it to create linkages with a host of countries across the globe – especially in the third world – where it wields considerable influence because of the positive impact on their economies.

Another contradiction precipitated by the US connection is the fact that the Chinese have piled up almost 3 billion in US greenbacks and thereby becoming the largest creditor to the US.

The Chinese are in effect funding the profligacy of the US consumer – a situation that has led to the US officials blaming the Chinese for producing goods too cheaply!

The US is placing great pressure on the Chinese for them to re-evaluate their currency so that Chinese products would cost more. The Chinese have retorted, in effect, that the US should return to its vaunted Puritan values and quit living beyond their means. Contradictions never cease.

Because of the historical humiliations inflicted on it by the west (and Japan), China has nursed a strong “victim mentality” since the 19th century. One refreshing contradiction, however, is that with its remarkable ascendancy, China has been very cautious in its relations with the western powers.

The Chinese leadership appears to be faithfully harking to Deng Xiaoping’s maxim of never acting arrogantly towards the US. However, there are some that suspect they are also playing possum, according to Mao Tse-tung’s “protracted strategy” – waiting patiently for the US to burn out. Even Deng Xiaoping’s directive of 1991 advised that China should “hide our capacities and bide our time” (taoguang yanghu).

For us in Guyana, it is important that we evaluate and take advantage of the changing relations in world affairs occasioned by the rise of China and the contradictions engendered by that rise.

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