(Translator’s
preface: The contemporary Chinese left treads a wary path. The capitalist-roaders do not allow free
expression of Marxist-Leninist views, so websites that the left can access do
not generally speak openly of China’s restoration of capitalism, but post all of Xi
Jinping’s speeches, and refer to China as a socialist country. However, between the lines a different story
emerges. For example, Deng Xiaoping is quoted as saying that if there is polarisation,
the capitalist-roaders will have failed. This article describes that polarisation,
so what is the implication behind the reference to Deng’s quote? The final
sentence holds the key to the author’s views.)
Qian Changming 2021-12-09 source: kunluntze institute
If the private economy is allowed to expand wildly without limits, if the hegemony of capital through "distribution according to capital" is allowed to run amok, how can polarization not occur? How can a new bourgeoisie not emerge?
A few days ago, I came across a set of figures that were surprising.
In 1978, China's GDP was US$268.3 billion, equivalent to RMB362.41 billion, ranking 15th in the world; by 2020, China's GDP will have reached RMB101.60 trillion, or about US$15.58 trillion, ranking second in the world. It is logical that the income of Chinese people should be generally improved and common prosperity achieved. But the reality is that China's Gini coefficient has increased from 0.18 in 1978 to 0.474 (0.61 according to the Southwest Finance and Economics Study), and the gap between the rich and the poor is widening.
According to Premier Li, 600 million people in China currently earn less than 1,000 yuan a month! Obviously, nearly half of these Chinese are naturally not considered "rich"; more are still associated with "poverty". On the other hand, it is true that China has the highest number of billionaires in the world! According to the Hurun 2021 Global Rich List, there are now 1,058 entrepreneurs with more than US$1 billion in China, surpassing the 696 in the US. The richest man in the world, Zhong Shanshan, owner of the Nongfu Spring water bottling plant, has a personal fortune of RMB 550 billion!
Why is there a polarisation between rich and poor?
Socialism is about "distribution according to labour" and follows the path of common prosperity, which cannot lead to polarisation between the rich and the poor (Deng Xiaoping also said in his southern talk that if our policies lead to polarisation, we have failed; if we create any new bourgeoisie, then we have really taken the evil road); capitalism is about distribution according to capital. The rich get richer by virtue of their capital (money generates money) and the poor get poorer without capital, the result is inevitably polarisation.
China is a socialist country, but how can such a huge polarisation occur? The answer is: the unrestricted implementation of a mixed economy with "multiple ownership" and a distribution system with "multiple modes of distribution".
The introduction of a mixed economy in socialist countries at a certain time is due to historical reasons. For example, in 1949 the Chinese revolution triumphed, the new democratic revolution ended victoriously and the socialist revolution began. History entered this phase, - also known as the transitional period. At that time the socialist public economy developed, and the original capitalist private economy still had to exist (in order to ensure social stability and the healthy functioning of the economy as a whole), which inevitably led to the formation of a mixed economy. Since a socialist country wants to follow the path of socialism, it must adopt the policy of "vigorously developing the public economy and using, limiting and transforming the private economy". It was this correct economic policy that finally allowed the capitalist private economy to be peacefully transformed into a socialist public economy in 1956 through the "public-private partnership" of redemption (avoiding the forced dispossession of Soviet Russia). This was the triumph of Mao Zedong's thought.
The socialist revolution was a long time coming. Since the reform and opening up, the private economy has been reopened in order to stimulate individual initiative. The current Constitution, as amended, states:
"At the primary stage of socialism, the basic economic system in which the public ownership system is the mainstay and a variety of ownership economies develop together, and the distribution system in which distribution according to labour is the mainstay and a variety of distribution methods co-exist".
Under the original conditions of the domination of the public sector economy, the "common development" of the private sector economy was allowed, which inevitably led to the formation of a mixed economy again.
"A 'mixed economy' is a dynamic economic system in a transitional form, which can develop in two directions: either as a socialist economy or as a capitalist economy. The key is the policy direction of the state. If a policy of "protecting the development of the public economy and using, restricting and transforming the private economy" is adopted, then it can develop into a socialist economy; conversely, if the policy fails to protect the public economy and allows the private economy to develop unrestrictedly, the result is bound to be capitalism.
Marxism holds that the nature of ownership of an economy determines the principle of distribution. A publicly owned economy is necessarily distributed according to labour; a privately owned economy can only be distributed according to capital. The result of the development of distribution according to labour is common prosperity, while the result of the development of distribution according to capital must be polarisation.
Take the United States, which is undoubtedly the most developed capitalist country in the world today, with an annual GDP of nearly US$21 trillion, a total population of 330 million and a GDP per capita of US$63,600 (RMB 405,100). It can be said to be so rich that everyone can live a good life. However, because capitalism is based on capital and is so polarised, apart from a few rich people, more than 40 million people live on government food stamps every day; 800,000 people are living on the streets and homeless; and now, during the epidemic, 28 million people in the United States cannot afford to pay their rent and could be evicted by their landlords at any time if not for the government's ban. This means that capitalism, as developed as it is, is inevitably polarised: the few get rich and wealthy; the many suffer from poverty.
Today, under the pretext that the country is still at the "primary stage of socialism" and allows "the joint development of a variety of ownership economies", some people are developing the private economy without restriction. On the pretext that the "primary stage of socialism" allows "a system of distribution in which multiple modes of distribution co-exist", the principle of "distribution according to labour as the mainstay" has been fundamentally abandoned, and capital has been allowed to hegemonize the "distribution according to capital".
If the private economy is allowed to expand wildly and unrestrictedly, if the hegemony of capital is allowed to act unchecked, how can polarisation not occur? How can a new bourgeoisie not emerge? If this continues, China's mixed economy will inevitably slide into capitalism, the socialist state will deteriorate, and the fears of Chairman Mao's lifetime will arise.
"I don't want the day to come when there will be more exploitation of people in China, new capitalists, entrepreneurs, workers, prostitutes and opium smokers; if that happens, the blood of many martyrs will have been shed in vain...". (Mao Zedong, Central Literature Publishing House: A Biography of Mao Zedong)
The only way to avoid this sad phenomenon is to adopt a policy of "using, restricting and transforming the private economy" during the mixed economy stage, relying on the power held by the Communist Party.
The uncontrolled expansion of the private economy (including foreign investment) must not be tolerated any longer!
……………….
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