On 6th November, the world's dominant superpower holds its Presidential election. Two days later, its main rival for that title begins the process of selecting the nine men who will lead it for the next generation. The US President is often labelled the Most Powerful Man in the World, but the men who will form the Standing Committee of the Chinese Communist Party can plausibly claim to be the Nine Most Powerful Men in the World. This reality is what underlies the spectacle of Obama and Romney trading insults in the Presidential debates about who would be more likely to 'get tough with China'. According to many China watchers, the 18th Congress of the Chinese Communist Party is expected to inaugurate the era of the 'princelings'-a clique made up of the sons of the 1949 generation, who are expected to oversee China’s replacement of the US on the global centre-stage.
China the Superpower?
According to IMF projections, this tectonic shift in the balance of the global economy is just four years away. The rise of China to its current position as the world's second- biggest economy is the most important geopolitical trend since the fall of the USSR in the 1990s. Its prodigious growth rates of 10% over the last decade have left leaders of other advanced states standing in awe and envy as their economies nosedived into recession from 2008.
China's ascent to quasi-superpower status has manifested itself in numerous ways. Consumers in Western high streets have witnessed their shops fill up with a ubiquitous array of commodities marked 'Made in China'. The luxury-item shops on those high streets have also seen an increasing number of Chinese shoppers jetting in to spend their newfound wealth. Numbers of Western educational institutions offering courses in Mandarin have reached record levels as the perception grows that it will be the language of business in the new century. American politicians have become increasingly paranoid about the 'dollar mountain' of US debt owned by China. The Beijing Olympics of four years ago were seen to mark China's announcement to the world that it was ready to assume the mantle of global leadership in the 21st century -‘China's century’. There has even been tentative talk that the next man on the Moon will be Chinese.
Yet there is another side to this giddy optimism. This year’s Communist Party Congress will open against a backdrop of an economic slowdown, faction fighting among the elite and increasing resistance from Chinese workers and peasants. When the President-designate Xiji Ping disappeared for two weeks this summer, the internet was buzzing with rumours of an internal coup. This reversal of fortune can only be understood if the trajectory of Chinese development is situated in historical context and China's current position in the integrated global economy is understood. In addition to these constraints, the princelings will increasingly be confronted by a foe of their own creation-the massive Chinese working class.
Integration with the West
The extent to which China and the West are interlocked was exposed spectacularly by the Bo Xilai scandal earlier this year-the most serious political rupture in the country for a generation. Bo was a rising star of the Communist Party and a year ago could have confidently expected to be promoted to the Standing Committee at the 18th Congress. One of the 'princelings', as party boss of the south west province of Chongqing he had established a reputation as a 'can do' regional fixer, cracking down on organised crime and using state funds to push growth. He first started to attract the suspicion of the party elite by reviving the populist mass singing and rallies associated with the Mao Zedong era. For the current elite, these techniques are an uneasy reminder of the political turbulence of the 1960s, when China appeared to be on the brink of internal disintegration.
Bo then came to the attention of the international media when his chief of police sought asylum in an American consulate last March. The dispute between the two men revolved around the suspicious circumstances of the death of British businessman, Neil Heywood, in November 2011. The subsequent trial led to the conviction for murder of Bo's wife and the swift termination of his own political aspirations. The scandal also exposed the playboy lifestyle of his son, who had injudiciously posted photos of his extra-curricular activities at Harvard University on Facebook. These aspects may make it seem a matter purely of the individual failings of a particular official, but Bo's fall from grace is also an outward sign of a factional battle within the ruling class over the speed and extent of China's integration with the global economy.
The relationship between the economies of China and the US has been described by the economist Fareed Zakaria1 as the 21st century equivalent of Mutually Assured Destruction (the military doctrine of nuclear deterrence that shaped the foreign policies of America and Russia in the second half of the 20th century). China has amassed a currency reserve of about $1 trillion, which periodically loans back to the US to sustain the latter's deficit spending. This in turn enables American consumers to continue buying the imported commodities from China that flow in massive quantities across the Pacific. The US spending spree reciprocally supports China's export-driven and low-wage economy.
This circle of dependency however is also at the root of China's inability to decouple itself from the global economy. It creates a break on its capacity to threaten the long-term economic hegemony of the US. The Chinese boom in export industries is founded on the joint pillars of underdeveloped domestic consumption and a notoriously exploitative system of sweatshop labour. The dilemma facing the Chinese ruling class is how to square this circle; how to cultivate a domestic middle class willing to save less and spend more, without loosening the iron grip on a working class that is becoming increasingly restless. The tensions attached to such a polarisation are obvious. China is home to a million dollar-millionaires, but also has 150 million people living on less than a dollar a day.
The elites are all too aware of how similar one-party states in Eastern Europe imploded in the 1990s after attempting marketisation. The 'Stalinism with a Coke' model, as John Rees describes it,2 has facilitated China's remarkable rise on the global stage but there is a risk inherent in maintaining totalitarian control of a state that is simultaneously seeking economic diversification. The factional strife in the upper echelons of the Chinese Communist Party on the speed of this process is the backdrop to the Bo Xilai scandal. The difficulty of the transition is also highlighted by the recent announcement the annual growth rate has slipped to 7%, still beyond the dreams of any Western economy but a downturn for China. The downsizing is another indication of China's inability to escape the impact of a recession of spending in the West.
The economic interdependency of the US and China should cool the paranoia that permeates sections of the Western ruling class about 'China's Century' and its imminent threat to their strategic interests. Books with titles such as 'When China Rules the World' and 'Bowing to Beijing' have become bestsellers and stirred up anxiety among politicians in Europe and the US. This hype is misplaced, not just because of the interlocking of the global economy but also because of the historical trajectory of the Chinese state over many centuries. As the world's oldest continuous civilisation, China's rulers have always prioritised internal control over external expansion. The current elite share the agenda of their imperial counterparts during the Tang and Song dynasties, the peaks of Chinese state power in the medieval era, to consolidate absolute power of the huge territory of the Chinese state and only cultivate foreign contacts in so far as they will assist that process. 'Hide brilliance, cherish obscurity' as former leader, Deng Xiaoping put it.
This sober reality debunks the notion that China could rival the US militarily or politically in terms of global outreach. The gap between the two is highlighted by China's recent purchase of its first aircraft carrier, a second hand one from Ukraine. In contrast the US already has 11 state-of-the-art models. It is true that China has proved a formidable block to America's agenda at the UN over issues such as the Syrian civil war and Iran's nuclear programme, but this points to a desire to thwart US strategic encirclement rather than a bid to supplant it in the global arena. Likewise, China's increasing investments in Africa and Latin America are motivated by the pursuit of cheap raw materials for its push for growth, not an attempt to construct an imperial counterweight to the US.
The Princelings and the Proletariat
The princelings in Beijing will be cautiously optimistic that they can supervise the upgrade of China's global status because they are heirs to the generation which in the late 1970s presided over an astounding 17-fold expansion in the size of the economy. Starting with Deng Xiaoping’s comment that 'it doesn’t matter if the cat is black or white so long as it catches mice' ,the ruling class in 1978 embarked on a risky but ultimately productive plan to marketise agricultural production, while retaining a tight grip of the political process. Breaking up state control of rural communes and allowing peasants to sell most of their produce on the open market contributed to what some observers have called the greatest improvement in living standards in world history.
The incoming elite will, however, also be aware that this strategy was not an unqualified success. The incentivisation in the countryside generated inflationary pressure in the wider economy that triggered protests and strikes in the big cities. This rising tide of unrest in the late 1980s culminated in the spectacular student-worker demonstrations in Tiananmen Square, Beijing in 1989 that brought the regime to the brink of collapse. For a few weeks in the summer of that year, many Chinese cities were filled with thousands of demonstrators waving red flags and singing the Internationale, not in a choreographed display of obedience to the elite, but explicitly calling for its overthrow. Eventually the regime deployed its iron fist and smashed the protests with shocking brutality, leading to an estimated 30,000 deaths across the country.
The current boom likewise has created huge opportunities for the ruling class but also has potentially brought its gravedigger onto the scene. The focus on an export driven, low wage economy has created a 150 million-strong proletariat, concentrated in huge workplaces such as the notorious Foxconn factory in northern China, which assembles parts for many Apple products. Working conditions in sites like this resemble Marx's descriptions in Volume 1 of Capital of the English factories of the 19th century. Workers are regimented in military-style barracks and infamously, the suicide rate has been so high that safety nets have been installed to thwart suicide attempts.
Like their counterparts in the 19th century, however, Chinese workers are fighting back. Last September a 'brawl' involving 2000 workers led to a temporary shutdown of the plant, and Foxconn has also been the site of strike action. 'They're more willing to stand up for their rights, to stand up to injustice' said a spokesman from the China Labour Bulletin.3 Significantly, the government has stopped publishing data concerning workers’ unrest, but according to a CLB report this year there were 90 000 ‘mass incidents’ in 2009, and the likelihood is that number has continued to rise since then. The report adds, ‘The younger generation of migrant workers has certainly breathed new life into the workers’ movement, making it more organised, confident and effective’
In the 1950s Tony Cliff pioneered a Marxist analysis of the modern Chinese state which remains valid despite the zig-zags of its successive generations of rulers and its Communist veneer.4 China is a state capitalist economy in which a bureaucratic ruling class has centralised control of a semi-feudal economy and completed the tasks of a bourgeois, nationalist revolution. There are certainly major differences between the economic strategy of the Chinese ruling class and its Western counterparts, but like all other capitalist classes in the world today they are confronting the contradictions created by trying to simultaneously drive down the working conditions of the majority while sustaining the rate of profit in a global recession. It is quite possible that the 21st century will be ‘China’s century’, but in a radically different way from that envisaged by the princelings.
1. Fareed Zakaria, The Post-American World, 2nd ed., (New York 2011), p.124
2. John Rees, Imperialism and Resistance, (London 2006), p.58
3. A Decade of Change-The Workers’ Movement in China 2000-2010
4. Cliff, T, 1957. Mao Tse-Tung and Stalinism. Socialist Review, 135-142.
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