sowed seeds of Beijing October Review, journal of the Hong Kong section of the Fourth International. How Deng's policies ment, new political "Internationale' has increased again. by the pitiful and abject conditions in radical perestroika' applied to its security about getting a job, but by popular outrage at the incqualities and which the students live, and their in corruption which have gone with the reforms. In effect, China has had a economy, but no "glasnost" whatever. cultivate a lechnocracy and encourage. production and an invigorated. market This line, hased on the technocrats ment of capitalist elements in China, ending the system of state ownership. ernsion has not yet brought about a ly increasing. The present policy of the development of commodity the planned economy and the monopoly of foreign trade. The the burcancracy cannot effectively defend the socialist elements of the economy from further erosion: Part of ning lo disintegrate. the mle of state countryside, has fostered the develop- qualitative chunge, hut is quantitative- the state ownership system is begin planning and distribution is lessening. the rule of market mechanisms is in revolt On the same road? Deng (left) with former 'heir apparent" Zhao Ziyang last year: and the competent The present movenient in Beijing, volving the mobilisation of millions of workers, students and intellectuals, is: tion of 'multipartyism" and a Shanghai and other major centres, in- the continuation of the December 1986 movement. It is inspired not only The economic policy of the Chinese Communist Party fac- tion around Deng Xiaoping has aimed from the beginning to bureaucratic rule. Its basic ap- proach has been to deprive the democratic power over produc- tion, while conducting an open- door policy, hoping that with the help of technology and capital power to local bureaucrats, secking to preserve and strengthen labouring masses of their from other countries China At the same time the Deng faction has relaxed the administrative stranglehold on the economy of the Mao Zedong era, and decentralised could make economic progress. democratic political system. with petty of- as a whole - 'liberals' - is "The regime fences, were executed by 'hardliners" capable of" authorities, the savage repressive dication of prisoners, year up to a clear in- one. Last a brutally which the regime is brutality charged many of 30,000 them Page 16 and the
it Trotskyists "The CCP headed by Deng is by Stalinist, and against leadership nature intellectuals who were branded "rightists" in 1957) further en- couraged the mood and struggle of the masses, wave of wall posters. democracy, protests and this gave an un- petus to the 'Beijing movement, with its demonstrations for secution, and the mush- rooming unofficial or and Spring democracy against hunger and per ganisations + M
borders" proposi- socialist democracy struggle for tions - self and world revolution two basic in China it- outside its structure or the relation- ship between the ruling democratisation be- The Beijing Spring constituted a ment in China. Before its suppression in the spring of 1981, vanguard forces among the masses had linked up ex- people, mainly workers and some The policy of the Deng faction did noth- ing to alter the super- people: so political came the central demand of the milestone in the democracy move- tensively with each other. Young former red guards' who had ex- perienced and reassessed the Cultural publications. popular movement. delegation to Moscow including President Liu Shaogi and Premier Zhou Enlal Deng's line has remained a Stalinist line throughout: here in 1963 he leads a propositions - socialist democracy in ganisations such as trade unions and China itself and world revolution out- The CCP has always consciously repressed the independent class mobilisation of the workers and peasants, strictly controlling mass or- The development of mass struggle side its borders. Moscow including Ir banned the right to strike and the tend ideas, to write wall posters and to debate), and deleted these from Chinese masses, the Deng faction quickly discarded its "liberal' posture and resorted to burcaucratio repros: Four Freedoms" (to air views, to con- China'sconstitution. It banned unoff- cial organisations and publications. and arrested fighters for democracy. It sion of democratic demands. delegation to
contradictions and probed altematives for development. Its mainstream af- Firmed socialis aand demanded the sociation of Unofficial Publications in democracy movement to fom the It oriented towards links with the working class, rooting itself among solidarity with the international work- The burcaucratic repression in Revolution, gathered around unoffi- cial publications, diagnosed social realisation of socialist democracy, In September 1980 the National As- China was founded, signifying a con- scious joining of forces in the embryn of a revolutionary leadership. workers and communicating in 1981 compelled the democracy move ing class movement. critical thinking. This has been one of that the masses had developed heyond resistance, go slows and boycott, to The death of Mao Zedong deprived the CCP of a central leaderand opened people gradually to break away from express their discontent with the even persecuting or exterminating workers who indulge in independent. the key means by which the The 1976 Tienanmen riot showed their previous long periods of passive ruling faction through massive spon- taneous actions. It was a preview of the anti-bureancratic political revolution, and was only suppressed hy the CCP up a historical opportunity for the bureaucracy safeguards its rule. the chains of autocracy. thrnugh hrute force. "spiritual pollution', and even ex- fully exposed its determination to repress and crush any accumulation of verse deeds of the final period of Mao tion was compelled to admit some of the errors and abuses committed by Man and the central leadership of the CCP, they did theit best to prevent the repressed critical works by writers, carried out a campaign against pelled some members of the Com- munist Party (CCP) who had advo cated more daring reforms, The reaction of the ruling faction to the stu- dent movements in 1986 and 1987 Ideolegically, the bureaucracy at- tempted to shirk all blame for the ad Zedong's rule. Though the Deng fac- penple from making a radical reasses- strength by the people.
derground" "The movement pelled the democracy bureaucratic repression in 1981 com- to turn un- Pace 17 ment to tum undergmund. Continual tionary position of the Deng faction and helped vanguard elements discard. As the ruling faction's urban tacks. Soaring price rises atlacked their living standards: the contract ferentials direcily attacked the right to living standards under fire, defensive struggles such as strikes and go-slows For the peasants. Deng's reforms economic refons began to untold. the working class suffered new at- system and the widening of wage dit- work and welfare benefits, With real repression further exposed the reac have increased. The masses began to exert pressure, raising various demands including an people's material and cultural life. socialist democracy and a system of pelled the ruling faction to rehabilitate as a spontaneous revolutionary mass action. The partial rchabilitation of this incident and other wrong verdicts (including several hundred thousand legality, and the rehabilitation of end to the political repression of the Mao Vedong era, improvements in the The pressure of the masses and the factional struggle inside the CCPcom- the Tienanmen incident, recognising it people victimised by wrong verdicts. SOCIALIST OUTLOOK no 16. June 1989 The rise of the Deng Faction to vocated by Stalin. On the contrary, Its revolution to other countrics, and Dong ishy nature Stalinist, and against it Trotskyists struggle for too basic ment of Mao Zedoug or the Cultural power has not altered the line of huild- ing "socialism in one country" as ad- open-door policy and its general domestic and foreign policy are a con- tination of this line. The bureaucracy still refuses to extend the socialist socksto repress the people s mobilisa tion within the country it controls. Thus the CCP leadership headed by
This anarchic state of production is harically their most basic needs. What decides invest- tion for society as a whole, but considera- tion of dispersed, in- dividual economic sectors or enterprises: hence production tends towards anarchy. geared towards satis- fying those who can af- ford to pay, not the general masses and ment is not considera- Z SUPPLE However the policy of The rural question is again becoming grave, peasant riots against bureaucratismand by mid 1987 offered relief from the 'People's Communes'. encouraging the com- petent elements' to en- rich themselves accen- гитя] differentiation, ag- tween rich and poor. hureaucratism took the gravating the gap be- bondage al tuated riots against by mid 1987 question is grave, and took place "The rural again be- peasant coming
inevitahly still prevail. development of productivity and insuf- ficient supply of goods goods to retain their and the market and small scale commodity production similar to the features of the market cconomy In a society in the socialism, especinily in economically back- cause consumption Administrative from ward countries, the un characteristies as coll in capitalist society. capitalism transition even Shanghal: workers join with students in revolt at Com- ening Gre Septemher I8 1985.2 the students look again g o the streets in massive & and struggles were discontent. Following, numbers in December tradictions and mass rightist policies in the countryside began 1o dent demonstrations reflections of social the demonstration of place in Shandong and The new social con- discontent aroused by the Deng faction's the surface in 1985. Stu- Hunan provinces. and cities provinces" dong and in Shan- Hunan
administrative means, resulting in a However the plan was drawn up en- tirely by party cadres and was decided compelled to execute the plan. The "planned ccopomy" became an economy planned by bureaucratic conmand. Under the rule of Mao Zedong, consumer goods were scarce hureaucracy tried to ban the market by methods to repress or climinate them are not effective. Only through the gradual raising of productivity and enablish- ing the abundance of products can The CCP practised economic plan ning soon after it gained power. by those above; those below were Tow in quality, and the their mle diminish and vanish. munist Party corruption and repression of democracy previous production by command to the present production by non-banding guidance. There had been a reduction the state from 256 kinds in 1984 tojust 20. There had also been the emergence of a labour market, a market in means The gradual reduction of the scope of Until the end of 1986, the result of tem was that the categories of products produced by command under the State Planning Commission had fallen Fron Production of grain and other major agicultural products had changed from in resources centrally distributed by of production, and a capital market. planning signified a continuing the initial reform on the planning sys- around 120 in 1984 to about 60. The Deng faction will not be lenient strength in order to change the present and their exposure of the social con- tradictions have drawn extensive sym- pathy and support, and the state of in- difference and lack of contidence or perspective among the masses is Repression will continue, yet it will also lead to the masses discarding their illusions and turning to their own in its suppression of the mass upsurge The planned economy and the market economy 1986, Their unequivo- cal demand for politi- cal democratisation beginning to change. bureaucracy quality, and goods were tried to ban scarce and rule of Mao the market "Under the consumer Zedong, low in the
economic centres. To permit market anarchy of a capitalist economy. logether with the co-existence of under-production in some sectors and over-production in others. Atthe same Lime large amounts of social surplus burcaucratic administrative control, and at the same time swung to the right, permitting the market law of countryside and then in the urban functions to operate fully meant more and more a restoration of the tradictions and a serious sethack to the The Deng faction relaxed the value to operate freely in the SOCIALIST OUTLOOKno 16, June 1989 series of economic and social enthusiasm of the producer. cconomy calls for conscious analysis priorities. But under the domination of the market economy, production is predominance of themarket economy, planned economy are in opposition of socicty's overall demand, and al- location of social resources and products according to pre-established decrease in the weight of the planned cconomy and its replacement with ment along these lines might lead to a which the CCP camouflages with the The market economy and the and contradiction. The planned market mechanisms. Further develop ten "socialist commodity coonomy The economic policy of the Deng centives and market mechanisms lo strangled by the bureaucracy. On the cconomy as predominant, with market. adjustment as a supplement. On the other hand, it has set out to 'fully develop the market in commodities, gradually perfect the market system. faction is to make use of material in- activate an economy which had been one hand, the regime has not up to now tion of retaining the planned and reduce the scope of planning car- announced any change in its formula develop the commodity economy' ried out by command. ministrative resulting in a series of and social contradic- economic means, tions" by ad- Page 18
'ultra-left' policy it CCP changed its previous swung to "When the sibility system was to establish the family as the unit of independent production. This means the restora- tion of small-scale individual peasant production, and the abolition of the mode of collective farming of the Mao Zedong era, when the basic unit of ac- Such a change means concessions to the peasant tendency for small recognition by the CCP that the line of counting was the production brigade. production, and also signifies official Increased supplies of consumer goods have become available: but at a price, as inflation soars of living. In fact the long periods of sumption did not bring gains from an When they decide the ratio between bureaucrats pose the question in the accumulation and consumption, the improvement of the people's standard neglect of the development of agricul- ture and light industry have created serious imbalances which have in turn impeded the development of heavy in- dustry. Hence a reduced rate of con- increased rate of accumulation. cumulation of private capital, Since now directed by profits, the planned After the Deng faction came to power. there was a slight rise in the products were not converted into so- cial accumulation but into the ac- both investment and production are rate of consumption in the national in: economy will gradually disintegrate. Accumulation and consumption
individual without the other extreme, en- enrich themselves couraging peasants to The Deng faction was forced to lift munc, and its slight increase in the sidiary foods (which had long been maintained at a very low level) resulted in some improvement in the impoverished living standard of the tive. An a result, the first few ycars of showed a rather quick increase in the People's Commune was bankrupt. the bondage of the Poople's Com- purchasing price of agricultural sub- peasants, and increased their initia- the production responsibility system simplified formula that an increase in investment". This is not actually so. tant factor. Under burcaucratic rule, producers, a considerable portion of non-productive way, in particular in consumption means a decrease in berides the portion devoted to produc- the social product is consumed in a redundant administrative apparatus. The productivity of labouris an impor- tive investments and consumption by the consumption by the privileged burcaucracy and the expenses of come. There was more development There was also an increase in funds to Facilitate a rise in state purchasing stimulate the people's incentives to produce. However from 1983 on- wards this policy was thrown into reverse: the rate of accumulation rose, oflight industry and increased produc- Lion of day-to-day consumer goodr. These moves were intended to nong with the proportion of heavy in- dustry in the value of industrial output. prices for some agricultural products.
tance" restraint, them assis- and giving policy it swung to the other extreme, encouraging individual peasants to enrich themselves without restraint, and giving them assistance. This caused a concentration of farm land in agricultural and subsidiary produc- Nevertheless when the CCP changed its previous ultra-left' A powerful stratum has emerged in the countryside as specialised the hands of the competent growers". Byabolishing the economic privileges of the bureaucracy, productive invest- ments and consumption hy producers can both be increased. In addition. the ment, today's massive squandering of tion could also he drastically reduced. removed, Under democratic manage resources in production and circula major detrimental fuctor in the en- thusiasm of producers can be The rural economic The scale of investment in fixed assets at central level, local level and in non- planned sectors could not be reduced development of light industry slowed und went out of control. The policy of giving priority to beavy industry remained predominant, and the down. Investment in agriculture fell every year (is share of total capital in- vestment fell from 11.1 percent in 1979 to 3.4 percent in 1985). Thux the proportion of consumption shrank
Pare 19 householdsengaged in industry, com- merce, communications, construction and services, their capital accumula- tion is growing. Rich peasants, private commercial entrepreneurs and even loan sharks have appeared, and 'millionaires" eulogised by the regime obtained publicity. By 1986, the fixed assets of proposed that a portion of penple (the The practice of the contract respon was to encourage pearants to enrich themselves. The official formula "competent) getting rich first would lead to common wealth heing enjoyed The rural policy ofthe Deng faction by the entire population. SOCALIST OUTLOOK no 16, June 1989 the economy and raising productivity, Although heavy industry is the most important sector in developing the planned economy should not pur- sue the most rapid development of a single sector but seek the optimal eF- ficiency of the cconomy as a whole. In particular its focus should be on the while that of accumulation has nisen.
Taw of value. Under In the absence of operation of in- enterprises is more and more subject to market under the domination of the decision-making and supervision by the workers, the and the law of the market, and they compete for resour- cos and for the democratic dustries councils': = LE S UP countryside make up. tion of the rich, using the power in their hands to obtain the most favourable condi- tions. Beaucrat capi- tal is gradually lomm- enterprises reached several million yuan. Economic consortia were also developing rapidly. The CCP the quite a significant por- private certain cadres ing: policy of as- policy of the Mao Zedong era and the competent sisting the Commune People's Dengist "The
workforce. The relations between the hiring for private operation of means of production and facilities which are The operators employ large numbers of workers, run the enterprises on capitalist methods, increase the inten- sity of labour, and squeeze the maxi- mum surplus value out of the such competition, the pursuit of profits becomes the aim of tion, and making enterprises respon sible for their own profits and losses leads inevitably to price rises, elimina- tion of the weak by the strong. The contract system means the state owned or collectively owned speculation and protiteening. Former allies now in deadly contest: Zhao Ziyang with Li Peng show itself and attract peasants to go Agriculture should go on the road of ment. Examples must be set for the peasants, and idcological education must be conducted. After long periods of effort, the superiority of collec- tivisation and mechanisation will voluntarily onto the road of collec- Towards this end, the stute must assist the peasants with material resources, tivisation, since they will see from ex- and benefits of the democratic and col- lective management of the farm. collectivisation and mechanisation. coupled with democratic manage- tised. The state farm was divided into small farms, and the state permitted the sale of farming animals, small and medium farm tools, trucks and staff quarters to the staff members. This means part of the state property of the farms is disintegrating and reverting to mountainous regions and the coastal provinces) is widening, and class con- In some state-run farms, the family responsibility system was also prac- (in particular between the inland tradictions are breeding. and developed regions differentiation in the countryside, the gap between the backward Alongside social private ownership. go to two ex- bureaucratic •.. appear to alternatives tremes, and themselves are the two sence they of Stalinist yet in es- to enrich rule"
A major part of the Deng Faction's reforu: gradual abolition of the state's uniforn setting of prices, which were Today the right of ownership of enterprises. This isbasically similarto the bourgeoisie holding shares in capitalist society, gaining surplus cconomic programme was price employ is in reality one of employer ferent from the exploitative relations some brigade-run enterprises in changing. Peasants can invest and hold shares in the collective contractors and the workers they and employee, not qualitatively dif- Price reform value without working. in capitalism. which now enjoy greater autonomy, profits and losses, submitting profits in lieu of taxes. In some enterprises, a shareholding system is heing at- tempted. Some state-run and collec tive enterprises are contracted to in- differentials are widening The con- tract system of employment is being enterprises, and separated the ad- decentralised ministration from the enterprises bearing responsibility for their own perience that it brings tiem rcal The urban economic power to bureaucrats in The Deng faction of hired lahourers, and unevenness of the market economy - all these cause stitute the motive force for capitalist In the past we opposed the Poople's which violates socialist principles; the and concentration of wealth, micans of production and some land; the ap- pearance of large numbers of hired labourers: the accumulation of private capital; the expansion of capitalist production on the basis of exploitation further class differentiation and con- In sum, the Deng faction's rural policy has struck a way out of the stalemate created by the People's Commune policy, yet it breeds new contradictions. The burcaucracy's laissez faire type of market refor comruption; the privatisation restoration in China.
modibies soared, with commodities in rier of price reform must be crossed" and must not be circumseribed". Thus control over prices was further relaxed, people's conditions of Living Hive withdrawals from the banks, and to he changed to free floating prices. The result was that the prices of the great majority of products and com- short supply soaring the most, and serious consequences for people's A complaint prevalent among the masses is "Nine years of reform; nine years of price inflation'. In May 1988 the CCP stated that the difficult bar- tumed more tough, there were mas SOCIALIST OUTLOOK no 16, June 1989 living standards. tioned. The party leadership no longer What the CCP tried to promote in the enterprises is not the autonomy of councils, but the concentration of nocrats who will act ax supporters of making powers enjoyed by the workers councils, as stipulated in state ordinances, are no longer men- directors, but neither is there the prac- tise of "leadership by workers' the workers or the expansion and functioning of the power of workers" power in the hands of the factory the ruling caste. Some of the decision exercises restraint over the factory directors to breed a layer of tech over the stale fami and extortion of far workers must be abolished: all fame workers should enjoy the rights enrich themselves. These two policios in essence they are the two alternatives same vacillations have appeared in the USSR and in the East European Weoppose the regression of collec- five production to small production based on the family unit. We propose that bureaucratic control by the CCP Commune policy of the Mao Zedong era. Now we also oppose the Dengist policy of assisting the competent to appear to go to two extremes, and yet of Stalinist bureaucratic rule. The A complaint 'Nine years among the nine years masses is of reform; prevalent inflation' of price Page 20
significant especially in the ac- "While there is no general rise tual income of the people, and while there the trade unions. However in China as In the past two years of the right to strike: in other bureaucratised workers' states, the trade unions do not take up thistask, and are instead the tool of the party's bureaucratic rule, assisting the In China the working class and its van- guard should draw from the ex- perience of the Polish trade union, and fight to organise a union independent the workers have ig- nored the cancellation with increased discon- ruling caste to implement its policies. of the govemment. 2 LL M these measures are detrimental to the Although the CCP has. always master of the country, it has always master. Since 1980, due to the impact Europe, and especially Poland, the interests of workers and should be proclaimed that the proletariat was deprived it of its power to be the of the workers" movement in Eastern LE un gravation of the crisis of hureaucratic rule, price reform was slowed down in September: In a difficult situation, the ly a question of insufficient products tion is not increased to meet the needs a rush for commodities. With this ag- The problem of prices is essential- to meet national needs. If the problem is not tackled at the roots, and produc- CCP's policy on prices vacillated, of the people, and instead state price setting is abolished, the con sequence can only he runaway prices, greater disequilibrium in production and even more dif ficulty in meeting people' surgent needs
obligation basic cost a subsidy are no con- to protect against price rises, has an to maintain on the crete state measures the state tent over price reform. the frequency of strikes and the numbers of workers participating in Go-slows are also more working class has in- pose the policies of the bureaucracy that are Under pressure from strikes and go-slows, the existing trade union leadership was compelled to change its tone or some of its methods of work. For example, it proposed that the govemment-run nature of the trade union should be reformed in order to them have increased. generalised and acute. This shows that the creasingly risen to op detrimental to their interests. Tangshan miners: workers rights eroded struggle of the Chinese workers for their rights has also developed. In order to prevent the eruption of a Polish-type labour movement in China, and in order to stimulate workers to help raise production, the CCP promulgated the "Temporuy or- dinance on workers' councils in state owned industrial enterprises' in July crease in the production costs of thus reducing peasant incomes. This agricultural and subsidiary products, will reduce peasant incentives to grow grain and Icad to decreased grain Safeguarding workers' While there is no significant general rise in the actual income while there are no concrete state measures to protect against price rises, the state has an obligation to maintain a subsidy on the basic As for the peasants, the general goods causes a substantial in- of the people, and especially risc on the prices of industrial cost of living"
of living" discontent numbers of frequency reform, the of strikes "With in- creased over price and the should stan its struggle with the fight realise the mass nature of the of the trade union'. It also proposed the es- tablishment of a minimum wage and a sliding scale of wages correspond- We propose that the working class Lo organise a democratic trade union. building a structure to fight for workers" rights, consolidating its strength and combativily, from which it can proceed to the fight to establish democratic relations of production In the past the CCP used ad- and the control of political power. economy and the private economy The individual ing with prices. tempted to go heyond it, For example, used by the authorities to implement Despite this, the promulgation of the ordinance retlected the fact that workers' discontent had pressurised sions; the workers could make use of this opportunity to fight for their own rights. Workers in many enterprises not only pressed the authorities to im- it was officially provided that workers 1981. This gave workers some powers: yet the promises were very limited, existing more in formality than in reality, and the workers' coun cils that were set up were in general devoid of power and were basically the CCP into making some conces- their policies and to raise production. plement the ordinance, ficiency. The CCP has also set out to widen wage differentials within each petition. The redistribution of wages By the end of 1987, the number of workersin China mached 130 million, with wer half of them being industrial workers, This figure is over ten times the number of workers in 1949: moreover they are concentrated in big industrial regions, and their weight is The CCP has set a quota for every state-owned enterprise fixing its total ing to the success of the enterprise in enterprise in order to introduce com- within a sct total amount was designed wage bill, which can only vary accord- accomplishing the state plan and itsef rights
and acute" generalised creased. Go-slows workers participat- have in- are also more Page 21 ing in them However the Dengist policy is to the state cconomy and the collective in stagnation, resulting in further shortages of goods. It was this objec- tive situation which forced the Deng stimulate the commodity economy and allow private enterprises to ganised way under the domination of the law of value. The commodity ministrative measures forcibly to climinate the private economy, while economy, under bureaucratic oppres- sion and with workers deprived of any right to decide, became bogged down develop in a spontancous and unor- faction to change its policy. committee: in a numher of enterprises responsible for the factory committee The defence of workers' interests should have boen the central task of in which the factory director would be could elect their rank and file leaders in the enterprise: however workers more and more demanded the election of all leaders, including the factory tised a system where the Inctory dirco- tory under the direction of the party workers pressed instead for a system - under the guidance of the workers' director. The authorities in fact prac- tor was the one responsible for the fac- SOCIALIST OUTLOOK no 16, June 1989 making workers work harder to gain more wages at the expense of other workers, Workers with weaker labour poweror those engaged in unskilled or duce differentials. competition and in- equalities within the working class. In addition, employment on contract recruited workers in state owned These workers now resemble casual workers, with no safeguards on their right to work or social security. All to increase the intensity of labour, simple labour faced a reduction in This was a conscious effort to intro terms was introduced for newly enterprises in the winter of 1986.
private industries and commerce, more threatening the crosion of Since the productivity of labour The activities of foreign capital in China and the interests of the econonuc system it represents arc in acute conflict with China's state cconomy. The more foreign capi- tal invests in China and coor dinates in activities with the grow- ing individual economy and the greater their strength and the of foreign capitalism is much higher than that of China, when China spontancously adapts to the state economy will become: Li Peng: conservative on prices Ш L econumy inevitably leads to the capitalists, while the majority of timates of Ge Lin, Professor at Nanjing University, by the end of 1987 30 million workers were hired by private enterprises in towns their output value com- small private emergence of exploiters and so- proportion becomes small people are reduced to hired labourers (according to the es- Under this policy the enterprises is very rapid. In some SU P cial polarisation. A development China). "by the end enterprises of 1987, 30 were hired by private in China" workers million
and integrates itself with the world fected by the periodic crises of world cipled opening up to forcign capital, it misleads the people into believing that ship and the planned economy, and Fosters illusions in capitalism along meanwhile, under the coordination of Lion is reviving in different areas of capitalist market, suplas value will flow out of China in massive volume and China's national economy will Find it difficult to develop inde- pendently as well as becoming af- capitalism. The experiences of some Eastern European countries have When the CCP argues for unprin- capitalism is superior to state owner- with loss of faith in true socialism. foreign capital, the system of exploita- relevant information, know how much capitalist economies, and be able lo need to maintain economic relations capitalist countries does not mean that China should fully open it- self up to the extemal world. Unprin- The people must fully grasp the is being paid and why during economic transactions with advanced make timely revisions under their own was done when China develaped its coonomy in autar- cconomic blockade. However the cipled openings to forcign capital by the ruling faction also cause unneces- Under increasing pressure from Loreign busineases, concessions made supervision and discussion. chic fashion under the Severe damage economy, the weight of state in dustries has fallen from 83 percent in prises a big proportion of the total in- dustrial output. In the national 1978 to 67 percent in 1987, and fur ther to 64 percent a few months later. andicating the tendency of private and other non-state enterprises to gain strength. This implies that the ad- vantageous position of state enterprises will gradually he replaced, and that the gains of the 1949 revolu- Lion are continuously being eroded, Halting this tendency requires the or ganination and mobilisation of the proletariat to take control of the run- the special economic Open door policy and ning of the state economy.
priority becomes more widespread, Some bureaucrats are looking to market economy: instead of pursuing their private interests with power in If capitalist forces develop in China China, More labouring people are ex- ploited: social differentiations in- crease, incqualitics expand, the men- tality of privatisation is strengthened, the concept that "money is the top convert their parasitic basis from the state mownership system to the their hands, they turn to becoming property owners making capitalist private investments. When large amounts of foreign capital enter more rapidly and extensively, and China, comprador capital may form. and the social mood worsens. Initial proposals for joint capital ven- tures or joint operations are becoming joint operation periods of several years (with the enterprise retamed to China at the end) are being extended to several decades: plans only to ex- consumption. The state monopoly of forcign trade is also under atlack. This not only provides a very favourable in- capitalists, bur also concedes part of the domestic maket, hence dealing a by China are increasingly significant sole operations by foreign capital: port goods produced by foreign capi- tal are giving way to production pan- ly or even entirely for domestic vestment ground for foreign The profits which foreign severe blow to national industry. The profits Hainan Island and 14 coastal cities to The setting up of four special economic zones, the opening of the external world, and varying degrees of opening of many other places, all show the exiensive opening can develop its cconomy with its doors closed. However, because the labour produc tivity of China is relatively low, the sary means to protect national industry from competition from capitalist cconomies with a higher labour productivity. Under the protection of a monopoly of trade, the state can selectively trade with imperialist monopoly of trade becomes a neces- of China to international capitalism.
the people, then at a certain moment Formations until the private ownerhip there is no powerful intervention from of crisis, the CCP will have to choose between two alternatives: either it changes its present rightist policies and restrains the activities of forcign and Chinese capitalist forces, or it continues to be swept away by capitalin forces and undergoes trans system assumes predominance and The final showdown will be in- evitable. This is the inescapable trend of development of the Chinese SOCIALIST OUTLOOK no 16, June 1989 capitalism is reinstated. remitted out of the country: this means industrial technology and equipment capitalists make in China can be con- verted to foreign currency and frecly that the wealth produced by Chinese workers, and national resources can he appropriated legally and without The CCP has made big conces- The balance is unfavourables the in- vestment of forcign capital is small and mostly concentrated in the non- productive sectors such as tourism and rcal estate. China even has to provide Joans, or invest jointly. The import of sions, but the actual gains are small. falls far short of the level expected. no heavy political or economic price. countries to utilise forcign technology and resources much needed for nation- al economic construction, as well ar Production items that are in demand but for which there are no state funds for development, can be produced jointly with foreign capital, all guiding principle should be that a project is beneficial to the overall Chinese econony, not hannful to the system of state property or the planned sions to foreign capital, and carrying but under certain principles. The over- cconomy, making no harmful conces learning management methnds. English, can be Review, which translated into Chinese, with contacted c/o 10144, Hong publishes in key articles GPO Box October Page 22 Kong