Saturday, August 16, 2008
Gong Xiantian on the Reform Process and the Law in China
"Since the reform and opening policy started—especially under the influence in recent years of neo-liberal economics of the West and the “Washington consensus”—a small minority in China, who seek to promote capitalism and to bring down the state enterprises on which the economy of New China has been based and which have scored an impressive record, smeared the state enterprises as being “inefficient” and “feeding lazy buggers”.
In name, they are seeking to steer the state enterprises to health, but in reality, they are steering them to death, selling them at deflated prices. (Remember what Premier Zhu Rongji once said: “In what way is it a sale? It’s a giveaway, a half-sale, half-giveaway.”) These moves have resulted in a massive leakage of the assets of state enterprises, forcing redundancy on many workers, resulting in the serious economic and social problems that prevail today, bringing great difficulties to the work of the party central leadership as well as the government, locking all players on the chessboard into a state where taking initiatives is difficult.
In recent years, people have taken counter-socialist measures and paths under fancy titles such as “a conversion to shareholding structure”, “cash payment in lieu of a worker’s entitlements based on years of employment”, “state enterprises retreat to make space for ‘people’-owned enterprises”, “management buyout” and “strategic restructuring”.
No one can say with certainty how much or little is left of the state enterprises! At the moment, no one has anything responsible to say about state enterprises and state property. According to the scientific estimates of veteran cadres who have spent their whole working lives at the State Statistics Bureau and other specialists, the output of the state sector isn’t even seventeen per cent of the country’s industrial output. Yet, highly regrettably, individual leading officials of the bureau continue to lie to the party central leadership as well as the people, failing to provide a credible figure. The statistics released so far are self-contradictory, full of mistakes and omissions, with errors of such a serious nature that they absolutely shouldn’t have occurred.
Although our party decreed and billed our task as two “unwaverings”, many of our cadres are unwavering only with respect to the so-called people-owned enterprises (which are mostly privately owned). Even years ago, there were provincial officials who appealed for a big push to develop so-called people-owned enterprises “with their hearts at ease [implying they wouldn’t be charged later for political incorrectness, as happened during the Cultural Revolution], with minimum prescriptions and with boldness”.
Later on, the “easy going” policy was added [as a fourth element], thus constituting the “four let go” policy on the people-owned economy. However, the development of publicly owned enterprises has received no special attention, as it should have, nor have useful measures been taken on the issue. Things happened this way because the public sector is not where the interest of these cadres lies. With meticulous calculation, they try to put state enterprises in an extremely difficult state, leading to the tragic situation where there was the need for a struggle for a [fair and equal] “national treatment” [on par with private enterprises] for state enterprises! This is why some members of the masses said the “common property party” [the literal meaning in Chinese of “communist party”] has become the “private property party”!
To talk about equal protection in such a grave scenario is like advocating protection for a beggar’s multipurpose stick and bowl equally with the machinery and vehicles of the minority! It’s like giving protection to the homes of average citizens, even their dangerous derelict homes, equally with the high-class villas of those who have struck a windfall fortune! According to the current conception of the Draft, equality will be delivered only to capital but not for the protection of labour. What is the difference then with capitalism? In the absence of the objects of such rights, or when such objects are few and far between, what possibility remains for equality of the subjects?
What difference is there then with equality under capitalism? What’s the point of protecting something that I don’t have? I don’t need protection for things not in my possession! Even less do I need protection for things that I can’t possibly have even in the future! With respect to the ownership of the means of production, one is super-rich, with net worth of millions, tens of millions or even hundreds of millions of dollars; the other is a bum possessing nothing of value, providing no basis at all to talk about any equality between the subjects! The prerequisites and targets for the adjustments that the Draft is aiming for simply do not exist!
In name, they are seeking to steer the state enterprises to health, but in reality, they are steering them to death, selling them at deflated prices. (Remember what Premier Zhu Rongji once said: “In what way is it a sale? It’s a giveaway, a half-sale, half-giveaway.”) These moves have resulted in a massive leakage of the assets of state enterprises, forcing redundancy on many workers, resulting in the serious economic and social problems that prevail today, bringing great difficulties to the work of the party central leadership as well as the government, locking all players on the chessboard into a state where taking initiatives is difficult.
In recent years, people have taken counter-socialist measures and paths under fancy titles such as “a conversion to shareholding structure”, “cash payment in lieu of a worker’s entitlements based on years of employment”, “state enterprises retreat to make space for ‘people’-owned enterprises”, “management buyout” and “strategic restructuring”.
No one can say with certainty how much or little is left of the state enterprises! At the moment, no one has anything responsible to say about state enterprises and state property. According to the scientific estimates of veteran cadres who have spent their whole working lives at the State Statistics Bureau and other specialists, the output of the state sector isn’t even seventeen per cent of the country’s industrial output. Yet, highly regrettably, individual leading officials of the bureau continue to lie to the party central leadership as well as the people, failing to provide a credible figure. The statistics released so far are self-contradictory, full of mistakes and omissions, with errors of such a serious nature that they absolutely shouldn’t have occurred.
Although our party decreed and billed our task as two “unwaverings”, many of our cadres are unwavering only with respect to the so-called people-owned enterprises (which are mostly privately owned). Even years ago, there were provincial officials who appealed for a big push to develop so-called people-owned enterprises “with their hearts at ease [implying they wouldn’t be charged later for political incorrectness, as happened during the Cultural Revolution], with minimum prescriptions and with boldness”.
Later on, the “easy going” policy was added [as a fourth element], thus constituting the “four let go” policy on the people-owned economy. However, the development of publicly owned enterprises has received no special attention, as it should have, nor have useful measures been taken on the issue. Things happened this way because the public sector is not where the interest of these cadres lies. With meticulous calculation, they try to put state enterprises in an extremely difficult state, leading to the tragic situation where there was the need for a struggle for a [fair and equal] “national treatment” [on par with private enterprises] for state enterprises! This is why some members of the masses said the “common property party” [the literal meaning in Chinese of “communist party”] has become the “private property party”!
To talk about equal protection in such a grave scenario is like advocating protection for a beggar’s multipurpose stick and bowl equally with the machinery and vehicles of the minority! It’s like giving protection to the homes of average citizens, even their dangerous derelict homes, equally with the high-class villas of those who have struck a windfall fortune! According to the current conception of the Draft, equality will be delivered only to capital but not for the protection of labour. What is the difference then with capitalism? In the absence of the objects of such rights, or when such objects are few and far between, what possibility remains for equality of the subjects?
What difference is there then with equality under capitalism? What’s the point of protecting something that I don’t have? I don’t need protection for things not in my possession! Even less do I need protection for things that I can’t possibly have even in the future! With respect to the ownership of the means of production, one is super-rich, with net worth of millions, tens of millions or even hundreds of millions of dollars; the other is a bum possessing nothing of value, providing no basis at all to talk about any equality between the subjects! The prerequisites and targets for the adjustments that the Draft is aiming for simply do not exist!
Monday, August 11, 2008
Han Deqiang - China's Renewal - Reform Yes but Socialist Reform not Market Reform
Besides Gong Xiantian, some of the most well-known critics of capitalist reimposition, or at least its shock-therapy methods, include economists Yang Fang and Zuo Dapei, both with the Chinese Academy of Social Sciences; ; former chief of the National Bureau of Statistics Li Chengrui; Ji Baocheng, president of Renmin University in Beijing (also known as the People’s University); Lang Xianping, U.S.-educated radio personality and teacher at the Chinese University of Hong Kong; Han Deqiang of the Beijing University of Aeronautics and Astronautics; and Wang Hui, a language and literature professor at Tsinghua University in Beijing.
Here we look at the views of Comrade Han Deqiang
This edited introduction is from Han's book: The Economics of Competition: A Critique of Paul Samuelson's "Economics," published by Jingji Kexue, Chubanshe, 2002
"The Economics of Competition: A Critique of Paul Samuelson"
by Han Deqiang
A Collective "Prisoners' Dilemma"
China has switched to a market economy for a whole decade now. People once hoped, and may still be dreaming that, as the institution matures and perfects itself, China would become a strong developed country, where democracy rules and people enjoy high quality of life not only in material terms but also in spiritual and moral terms.
But reality seems to be moving farther away from such a dream. Since the late 1990's, all kinds of Chinese enterprises have gone bankrupt en masse. With it came increased unemployment, lower mandatory retirement age, lower wages for workers, decreased income for farmers and slack domestic demand. With the influx of foreign enterprises and foreign products, many Chinese enterprises have switched their business lines because they no longer have the confidence to run a high-tech business at a profit. They become de facto employees of those foreign enterprises, earning meager fees for their efforts.
In the meantime, there has been a staggering number of tragic mine accidents that kill thousands year after year. Major accidents involving large number of deaths, such as firework factory explosions, plane crashes, as well as fires at cyber cafes, night clubs, theaters and shopping malls have occurred with mind-numbing frequency; villages and small towns are flooded with fake or poor quality products; drugs and AIDS are rampant.
Not only has corruption become a normal way of doing things among many officials, but it has also become a normal part of the values/belief system of the collective national psyche, marked by an egregious lack of civil-mindedness and ethical awareness. Teachers, doctors, lawyers and accountants all share the belief that " One must make use of one's position of power for self-enrichment before one loses it"; schools have become agencies that sell diplomas;hospitals force patients to pay up or leave.The lawyers are again edifying their clients by reverting to an old saying:
"court houses are for those who have money, not those who have a case";accountants have learned to "twist the numbers for money"; reporters routinely accept "gifts" of cash from those who desire a favorable write-up,young girls are not ashamed of providing sex-related services as a source of income and businessmen openly boast about their ability to concoct a confidence scheme to lure unwitting investors.
As this tide of corruption engulfs the nation, it is the workers and farmers who work the machines and land that are left utterly powerless and unable to defend themselves. They work more than twelve hours a day at the risk of death, maiming and deterioration of health, earning a meager pay that is often reduced or withheld by employer on arbitrary grounds. Their low income barely feeds their families. Finally even the elite segment of the society, which has ready access to state power, capital and knowledge, feels threatened by this rising tide of corruption.
Members of the ruling elite have now begun to talk at length in the media about the importance of "honesty and integrity". But the irony is that they only became rich because of their lack of honesty and integrity. They don't have the right to talk about "honesty and integrity" until they part with their ill-begotten wealth. When they, however, become ordained spokespersons for integrity,the word integrity has been rendered largely meaningless.
What went wrong? Why is it that where dragon's seeds were sown, only fleas have been reaped? Many Believers of market economy, who are not blind to the distressing realities of China today are wondering aloud: why has the market economy, when transplanted to China, produced so many undesirable consequences, just like the proverbial sweet orange trees, which would bear only bitter fruits when transplanted to the soil on the other side of Huai River? Is it because the soil of China is uniquely unfit for healthy growth of market economy?
China, however, is by no means a unique place where market economy has gone astray. Lately a huge bitter fruit has likewise been born in the United States, which is widely regarded as paragon of market economy. Enron,WorldCom Communications and Xerox Corporation have one by one been revealed to cook their books. And it was the venerable eighty-year-old firm, Andersen Accounting, that helped them do it. And before these were revealed, stocks onthe NASDAQ, a very mature stock exchange, lost more than 60% of their market value, or about half of U.S. GDP.
This is by no means something new. Back in the 1980's, the US government was forced to infuse close to 100 billion US dollars into saving and loan institutions in order to save them from bankruptcies. During this time period, junk-bond king Milken launched many hostile takeovers, causing well-run corporations to be broken apart or auctioned off one after another.
FOR MORE ARTICLES FROM HAN DEQIANG VISIT:
http://chinastudygroup.net/
Here we look at the views of Comrade Han Deqiang
This edited introduction is from Han's book: The Economics of Competition: A Critique of Paul Samuelson's "Economics," published by Jingji Kexue, Chubanshe, 2002
"The Economics of Competition: A Critique of Paul Samuelson"
by Han Deqiang
A Collective "Prisoners' Dilemma"
China has switched to a market economy for a whole decade now. People once hoped, and may still be dreaming that, as the institution matures and perfects itself, China would become a strong developed country, where democracy rules and people enjoy high quality of life not only in material terms but also in spiritual and moral terms.
But reality seems to be moving farther away from such a dream. Since the late 1990's, all kinds of Chinese enterprises have gone bankrupt en masse. With it came increased unemployment, lower mandatory retirement age, lower wages for workers, decreased income for farmers and slack domestic demand. With the influx of foreign enterprises and foreign products, many Chinese enterprises have switched their business lines because they no longer have the confidence to run a high-tech business at a profit. They become de facto employees of those foreign enterprises, earning meager fees for their efforts.
In the meantime, there has been a staggering number of tragic mine accidents that kill thousands year after year. Major accidents involving large number of deaths, such as firework factory explosions, plane crashes, as well as fires at cyber cafes, night clubs, theaters and shopping malls have occurred with mind-numbing frequency; villages and small towns are flooded with fake or poor quality products; drugs and AIDS are rampant.
Not only has corruption become a normal way of doing things among many officials, but it has also become a normal part of the values/belief system of the collective national psyche, marked by an egregious lack of civil-mindedness and ethical awareness. Teachers, doctors, lawyers and accountants all share the belief that " One must make use of one's position of power for self-enrichment before one loses it"; schools have become agencies that sell diplomas;hospitals force patients to pay up or leave.The lawyers are again edifying their clients by reverting to an old saying:
"court houses are for those who have money, not those who have a case";accountants have learned to "twist the numbers for money"; reporters routinely accept "gifts" of cash from those who desire a favorable write-up,young girls are not ashamed of providing sex-related services as a source of income and businessmen openly boast about their ability to concoct a confidence scheme to lure unwitting investors.
As this tide of corruption engulfs the nation, it is the workers and farmers who work the machines and land that are left utterly powerless and unable to defend themselves. They work more than twelve hours a day at the risk of death, maiming and deterioration of health, earning a meager pay that is often reduced or withheld by employer on arbitrary grounds. Their low income barely feeds their families. Finally even the elite segment of the society, which has ready access to state power, capital and knowledge, feels threatened by this rising tide of corruption.
Members of the ruling elite have now begun to talk at length in the media about the importance of "honesty and integrity". But the irony is that they only became rich because of their lack of honesty and integrity. They don't have the right to talk about "honesty and integrity" until they part with their ill-begotten wealth. When they, however, become ordained spokespersons for integrity,the word integrity has been rendered largely meaningless.
What went wrong? Why is it that where dragon's seeds were sown, only fleas have been reaped? Many Believers of market economy, who are not blind to the distressing realities of China today are wondering aloud: why has the market economy, when transplanted to China, produced so many undesirable consequences, just like the proverbial sweet orange trees, which would bear only bitter fruits when transplanted to the soil on the other side of Huai River? Is it because the soil of China is uniquely unfit for healthy growth of market economy?
China, however, is by no means a unique place where market economy has gone astray. Lately a huge bitter fruit has likewise been born in the United States, which is widely regarded as paragon of market economy. Enron,WorldCom Communications and Xerox Corporation have one by one been revealed to cook their books. And it was the venerable eighty-year-old firm, Andersen Accounting, that helped them do it. And before these were revealed, stocks onthe NASDAQ, a very mature stock exchange, lost more than 60% of their market value, or about half of U.S. GDP.
This is by no means something new. Back in the 1980's, the US government was forced to infuse close to 100 billion US dollars into saving and loan institutions in order to save them from bankruptcies. During this time period, junk-bond king Milken launched many hostile takeovers, causing well-run corporations to be broken apart or auctioned off one after another.
FOR MORE ARTICLES FROM HAN DEQIANG VISIT:
http://chinastudygroup.net/
Saturday, August 9, 2008
Chinese Political Economy : in order to build up his publication record so that he could become a professor, he had to hide his Marxist views
"Most surprising to me was a talk in which a professor of economics stated that Western-oriented neo-liberal economists dominate the economics departments at Chinese universities.
"He said that in order to build up his publication record so that he could become a professor, he had to hide his Marxist views in his papers and to incorporate the mathematical methods usually employed by Western economists even though he abhorred these methods".
"Ideological Struggle and the Socialist Market Economy" from Political Affairs publication of CPUSA.By Erwin Marquit leader of the Socialist Market Economy Group within CPUSA.
My question for Erwin Marquit why the surprise has any knowledge of post Mao Political Economy Developments in China from, the invitation of Milton Friedman to speak to Central Committee of the Communist Party of China, at the outset of the market reforms demonstrated that the political State power was out to marginalise marxist political economy and the notion of class struggle and labour capital conflict (see theory of Lin Zili in article below) theoretically.
However the reality of class struggle and labour capital conflict in Chinese society was growing giving the lie to the theoretical contortions of revisionist anti Marxist Political Economists like Lin Zili or an Erwin Marquit and his Chinese market apologists . In the Case of Labor Reform in China by Pao-yu Ching he clearly shows the neo liberal character of the Deng Xiaoping Reforms of market socialism.
The renewed interest in China today in Marxist Political Economy reflects that reality and its renewal is part of the critical renewal of the New Left in China so brilliantly articulated by comrade Gong Xiantian on the question of Property Law in his Open Letter.
The Theory of Market Socialism in China is a continuation of a debate that goes back to William Thompson and Thomas Hodgkins in the 19th Century - see History of Market Socialism on this site and discover how old are the so called new ideas of Market Socialism and how Marx, Engels, Lenin, Stalin and Mao Tse Tung fought against them and how the battle continues today..
"He said that in order to build up his publication record so that he could become a professor, he had to hide his Marxist views in his papers and to incorporate the mathematical methods usually employed by Western economists even though he abhorred these methods".
"Ideological Struggle and the Socialist Market Economy" from Political Affairs publication of CPUSA.By Erwin Marquit leader of the Socialist Market Economy Group within CPUSA.
My question for Erwin Marquit why the surprise has any knowledge of post Mao Political Economy Developments in China from, the invitation of Milton Friedman to speak to Central Committee of the Communist Party of China, at the outset of the market reforms demonstrated that the political State power was out to marginalise marxist political economy and the notion of class struggle and labour capital conflict (see theory of Lin Zili in article below) theoretically.
However the reality of class struggle and labour capital conflict in Chinese society was growing giving the lie to the theoretical contortions of revisionist anti Marxist Political Economists like Lin Zili or an Erwin Marquit and his Chinese market apologists . In the Case of Labor Reform in China by Pao-yu Ching he clearly shows the neo liberal character of the Deng Xiaoping Reforms of market socialism.
The renewed interest in China today in Marxist Political Economy reflects that reality and its renewal is part of the critical renewal of the New Left in China so brilliantly articulated by comrade Gong Xiantian on the question of Property Law in his Open Letter.
The Theory of Market Socialism in China is a continuation of a debate that goes back to William Thompson and Thomas Hodgkins in the 19th Century - see History of Market Socialism on this site and discover how old are the so called new ideas of Market Socialism and how Marx, Engels, Lenin, Stalin and Mao Tse Tung fought against them and how the battle continues today..
Thursday, August 7, 2008
Legitimizing Market Socialism: The Contortion of Marxism by G. Greenfield and Apo Leong
In the post-Mao era of market reform there remained a need for the market
socialist project to establish its theoretical and ideological legitimacy.
Central to reconciling a market economy with socialism was the question
of the commodification of labour and the social antagonisms implicit in it.
As market socialist theorists for the Chinese Communist regime have
indicated, the commodification of labour power in practice required a
rethinking of socialist theory if reforms were to continue: The development
of China's labour market is faced with an important theoretical
obstacle - the theory that under the socialist system labour is not a
commodity.This obstacle was dealt with in a vast literature on market
socialism.
Lin Zili, one of the leading theorists of Chinese economic reforms, justified the creation of a free labour market and the dismantling of egalitarian wage policies and restrictions on wage differentials (the same 'labour market rigidities' identified in Hu Zu-liu's report for the IMF) doing away with the very notion of exploitation:
"The exchange of equal amounts of labour is complex.It includes the exchange of unequal amounts of labour, with producers who have relatively advanced material production conditions still able to obtain a certain differential income, and the suppliers of capital able to obtain interest.These things are both unequal exchange of labour,involving the 'possession' of other people's labour, though they generally do not occupy an important position.
If at a certain time their role expands, then we can regulate and control them through macro-economic measures, so that polarisation and class antagonism do not result.Therefore, we consider it inappropriate to speak of unequal exchangeof labour in the socialist commodity economy as 'class exploitation'. Rather, it is more appropriately termed 'non-labour income".
As such the socialist commodity economy has 'broken through the traditional doctrine of only being able to have exchange of equal amounts of labour via the direct exchange of labour' and 'has enabled the abstract principle of exchange of equal amounts of labour to become united with reality".
In Lin's reading of Marx, 'socialism is unity among the workers,
and exchange of equal amounts of labour', and for Lenin, 'socialism meant
equal pay for equal work, which is also the meaning of exchange of equal
amounts of labour.' Having equated socialism with equal exchange, Lin
cites the shortcomings of Marx's notion of 'natural labour time' as a means
for measuring this equal exchange, arguing that with the complexity of the
quality and social division of labour in modern economic systems only
through the market can this exchange be carried out.
Therefore 'the exchange of equal amounts of labour must be characterized by the exchange of commodities of equal value, becoming a new form of equal exchange of value relationship: this is the socialist commodity economy.
Without any explanation of what compels workers to sell their labour
power and the social relations determining this, Lin achieves a link
between Marx and Lenin's conceptions of socialism (as constructed in the
official narratives of the Chinese Communist Party) and the rational
economic necessity of the market.
Thus the inequality and polarisation generated by the divergence between earners of non-labour income and sellers of labour-power reflects the fairness and equality in exchange envisaged by Marx:
The principle of exchange of equal amounts of labour involves equality in buying and selling different amounts of labour and in exchanging different average values. This causes people's economic benefits to depend on the amount and efficiency of their labour so that this kind of equality encourages efficiency.
In this market socialist mode of 'equal exchange' which claims to be different from capitalism; equality is subordinated to the imperatives of efficiency and workers are subordinated to the threat of impoverishment and unemployment.
While Marx understood the equal exchange of labour power as being complex, the solution did not lie in fostering existing inequalities, but in recognising its primary determinant - the structures and systems of power which shape the social relations of production and distribution.
Furthermore, Marx's conceptualisation of the equal exchange of labour is premised on the social working day, where the social division of labour, the length of the working day and productivity (intensity of labour power) is collectively decided and regulated by workers' councils.
The rationale of the Chinese socialist market, on the other hand, is premised on the commodification of labour power and the distribution of power in favour of managers and technicians to increase labour productivity. The social regulation of the working day gives way to the intensification of the pace of work and the extension of the working day, with only the decisions of managers and supervisors and the physical limits of human endurance to bring it to an end.
Implicit in Lin's assertion that the macro-regulation and control of a nascent capitalist class by the state will prevent polarisation and class antagonism is the assumption that the political regime will not become enmeshed in the accumulation of 'non-labour income', and that the state
itself is not the source of this emerging class of 'possessors of other people's labour'.
Yet the state apparatus which exercises policies of regulation or containment is precisely the same social power base from within which the new capitalist class and partners of global capital are emerging. Mayors of cities, city and provincial officials, military and police officers, are also managers of state-owned and private businesses,as well as being joint venture partners in the foreign-invested factories in the regions or industrial sectors in which they exercise political authority.
The legitimation of the accumulation of non-labour income (which includes interest and 'risk income') is central to Lin's conceptualisation of market socialism.
The accumulation of non-labour income (that is, profit) is merely a form of 'complex labour', a fact not understood since 'some comrades do not acknowledge that business is a form of labor."
By treating capital in the neoclassical sense of accumulated material wealth or money rather than a social relation, capital becomes income, then a form of complex labour.
Through this device, exploitation and class antagonism is dissolved in theory at the very moment at which it has become more and more a reality in state and collective enterprises.
As Apo Leong has observed elsewhere, the theoretical legitimation of exploitation coincides with the reconfiguration of the relationship between labour and capital from antagonism to partnership: 'Class struggle is no longer a byword within the ruling Communist Party and the
official trade union.
"Stability and harmonious relationship" between the employer and the employee has become the new catch phrase in the country's "historical mission of building a socialist market economy".
Given the monopoly on Marxism-Leninism and the production of official knowledge exercised by the Party elite and their entourage of officially sanctioned intellectuals, the marxist rationale of market socialism formed the basis of a new political economy of truth - the basic principles of
which would be beyond debate.
This is epitomised by Lui Guoguang's pronouncement that socialism and egalitarianism are incompatible:
'Socialism promotes the development of the productive forces, whereas egalitarianism hinders them. Therefore socialism and egalitarianism are not compatible".
This is not a new form in theory, but merely a reversal of the reversed Marxist truth.'" Whether or not this statement makes sense is less important than the power with which the proposal to abandon all state policies directed at ensuring social equality achieves immunity from criticism by claiming to embody a 'Marxist truth.'
Extract from CHINA'S COMMUNIST CAPITALISM:
THE REAL WORLD OF MARKET SOCIALISM
Gerard Greenfield and Apo Leong
Socialist Register 1997
socialist project to establish its theoretical and ideological legitimacy.
Central to reconciling a market economy with socialism was the question
of the commodification of labour and the social antagonisms implicit in it.
As market socialist theorists for the Chinese Communist regime have
indicated, the commodification of labour power in practice required a
rethinking of socialist theory if reforms were to continue: The development
of China's labour market is faced with an important theoretical
obstacle - the theory that under the socialist system labour is not a
commodity.This obstacle was dealt with in a vast literature on market
socialism.
Lin Zili, one of the leading theorists of Chinese economic reforms, justified the creation of a free labour market and the dismantling of egalitarian wage policies and restrictions on wage differentials (the same 'labour market rigidities' identified in Hu Zu-liu's report for the IMF) doing away with the very notion of exploitation:
"The exchange of equal amounts of labour is complex.It includes the exchange of unequal amounts of labour, with producers who have relatively advanced material production conditions still able to obtain a certain differential income, and the suppliers of capital able to obtain interest.These things are both unequal exchange of labour,involving the 'possession' of other people's labour, though they generally do not occupy an important position.
If at a certain time their role expands, then we can regulate and control them through macro-economic measures, so that polarisation and class antagonism do not result.Therefore, we consider it inappropriate to speak of unequal exchangeof labour in the socialist commodity economy as 'class exploitation'. Rather, it is more appropriately termed 'non-labour income".
As such the socialist commodity economy has 'broken through the traditional doctrine of only being able to have exchange of equal amounts of labour via the direct exchange of labour' and 'has enabled the abstract principle of exchange of equal amounts of labour to become united with reality".
In Lin's reading of Marx, 'socialism is unity among the workers,
and exchange of equal amounts of labour', and for Lenin, 'socialism meant
equal pay for equal work, which is also the meaning of exchange of equal
amounts of labour.' Having equated socialism with equal exchange, Lin
cites the shortcomings of Marx's notion of 'natural labour time' as a means
for measuring this equal exchange, arguing that with the complexity of the
quality and social division of labour in modern economic systems only
through the market can this exchange be carried out.
Therefore 'the exchange of equal amounts of labour must be characterized by the exchange of commodities of equal value, becoming a new form of equal exchange of value relationship: this is the socialist commodity economy.
Without any explanation of what compels workers to sell their labour
power and the social relations determining this, Lin achieves a link
between Marx and Lenin's conceptions of socialism (as constructed in the
official narratives of the Chinese Communist Party) and the rational
economic necessity of the market.
Thus the inequality and polarisation generated by the divergence between earners of non-labour income and sellers of labour-power reflects the fairness and equality in exchange envisaged by Marx:
The principle of exchange of equal amounts of labour involves equality in buying and selling different amounts of labour and in exchanging different average values. This causes people's economic benefits to depend on the amount and efficiency of their labour so that this kind of equality encourages efficiency.
In this market socialist mode of 'equal exchange' which claims to be different from capitalism; equality is subordinated to the imperatives of efficiency and workers are subordinated to the threat of impoverishment and unemployment.
While Marx understood the equal exchange of labour power as being complex, the solution did not lie in fostering existing inequalities, but in recognising its primary determinant - the structures and systems of power which shape the social relations of production and distribution.
Furthermore, Marx's conceptualisation of the equal exchange of labour is premised on the social working day, where the social division of labour, the length of the working day and productivity (intensity of labour power) is collectively decided and regulated by workers' councils.
The rationale of the Chinese socialist market, on the other hand, is premised on the commodification of labour power and the distribution of power in favour of managers and technicians to increase labour productivity. The social regulation of the working day gives way to the intensification of the pace of work and the extension of the working day, with only the decisions of managers and supervisors and the physical limits of human endurance to bring it to an end.
Implicit in Lin's assertion that the macro-regulation and control of a nascent capitalist class by the state will prevent polarisation and class antagonism is the assumption that the political regime will not become enmeshed in the accumulation of 'non-labour income', and that the state
itself is not the source of this emerging class of 'possessors of other people's labour'.
Yet the state apparatus which exercises policies of regulation or containment is precisely the same social power base from within which the new capitalist class and partners of global capital are emerging. Mayors of cities, city and provincial officials, military and police officers, are also managers of state-owned and private businesses,as well as being joint venture partners in the foreign-invested factories in the regions or industrial sectors in which they exercise political authority.
The legitimation of the accumulation of non-labour income (which includes interest and 'risk income') is central to Lin's conceptualisation of market socialism.
The accumulation of non-labour income (that is, profit) is merely a form of 'complex labour', a fact not understood since 'some comrades do not acknowledge that business is a form of labor."
By treating capital in the neoclassical sense of accumulated material wealth or money rather than a social relation, capital becomes income, then a form of complex labour.
Through this device, exploitation and class antagonism is dissolved in theory at the very moment at which it has become more and more a reality in state and collective enterprises.
As Apo Leong has observed elsewhere, the theoretical legitimation of exploitation coincides with the reconfiguration of the relationship between labour and capital from antagonism to partnership: 'Class struggle is no longer a byword within the ruling Communist Party and the
official trade union.
"Stability and harmonious relationship" between the employer and the employee has become the new catch phrase in the country's "historical mission of building a socialist market economy".
Given the monopoly on Marxism-Leninism and the production of official knowledge exercised by the Party elite and their entourage of officially sanctioned intellectuals, the marxist rationale of market socialism formed the basis of a new political economy of truth - the basic principles of
which would be beyond debate.
This is epitomised by Lui Guoguang's pronouncement that socialism and egalitarianism are incompatible:
'Socialism promotes the development of the productive forces, whereas egalitarianism hinders them. Therefore socialism and egalitarianism are not compatible".
This is not a new form in theory, but merely a reversal of the reversed Marxist truth.'" Whether or not this statement makes sense is less important than the power with which the proposal to abandon all state policies directed at ensuring social equality achieves immunity from criticism by claiming to embody a 'Marxist truth.'
Extract from CHINA'S COMMUNIST CAPITALISM:
THE REAL WORLD OF MARKET SOCIALISM
Gerard Greenfield and Apo Leong
Socialist Register 1997
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