The BT: Capitalist Roaders in The Myth of Capitalist China

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15/08/2021 by socialistfight

By Gerry Downing

Aims of Socialist Fight

The BT glorifies the bogus All China Federation of Trade Unions and China’s capitalist billionaire entrepreneurs as the makers of wealth by supporting President Xi Jinping today and Deng Xiaoping, the capitalist roader, against the leftist impulses of Chairman Mao Zedong during the Cultural Revolution period of 1966-67.

1. We stand with Karl Marx: ‘The emancipation of the working classes must be conquered by the working classes themselves. The struggle for the emancipation of the working class means not a struggle for class privileges and monopolies but for equal rights and duties and the abolition of all class rule’ (The International Workingmen’s Association 1864, General Rules). The working class ‘cannot emancipate itself without emancipating itself from all other sphere of society and thereby emancipating all other spheres of society’ (Marx, A Contribution to a Critique of Hegel’s Philosophy of Right, 1843).

The Bolshevik Tendency (BT) has given us a 19,000-word, anti working class diatribe, The Myth of Capitalist China, ‘Trotskyist’ impressionists can’t explain resurgent state sector, which is overtly hostile to the independently organised working class, overtly hostile to their democratic rights, glorifies the bogus All China Federation of Trade Unions and China’s capitalist billionaire entrepreneurs as the makers of wealth by supporting President Xi Jinping today and Deng Xiaoping, the capitalist roader, against the leftist impulses of Chairman Mao Zedong during the Cultural Revolution period of 1966-67. This dismisses the struggle against Stalinism’s socialism in one country and via this against imperialism in general. Elsewhere we have polemicised against the BT and the whole Spartacist League/ICL tradition of James Robertson and his capitulation to imperialism via the theory of interpenetrated peoples in Ireland and Palestine in particular. [1] The BOL-EA article of August 4, 2021, Capitulation to Imperialism, Neutrality and ‘BT’ expands this position globally. [2]

This BT document is obviously from a group without a serious orientation to the working class. The contempt for the working class and its preferences for Stalinist oppression goes back to its support for General Jarulzeski’s martial law in 1981-83 suppression of the independent workers’ organisation Solidarnosc, albeit led by the capitalist restorationist Lech Walesa, and its failure to consistently oppose US imperialist interests in the Iranian revolution in 1979 with the neutralist slogan, “down with the Shah, down with the Mullahs”. This contempt oozes from every pore of this document and is apparent if you contrast their line to point one of Socialist Fight’s Aims above. The BT piece argues for the exact opposite; billionaire President Xi is providing the non-capitalist road for workers’ emancipation, the workers themselves do not get a look-in.

What defines the class character of a state?

The document seeks to prove that China remains a deformed workers state because President Xi has decreed that the State Owned Enterprises (SOEs) must be prioritised over private enterprises since about 2011 and us “‘Trotskyist’ impressionists” simply can’t explain this phenomenon, characteristic of a deformed workers state and not of a capitalist state.

First let us explain, once again, what defines the class character of a state. According to Trotsky’s succinct definition, “the class character of the state is determined by its relation to the forms of property in the means of production” and “by the character of the forms of property and productive relations which the given state guards and defends”. This implies a dialectical rather than a mechanical relationship between base and superstructure: it is not merely a question of the existing forms of property but of those which the state defends and strives to develop. [3] [4]

Underlining this approach, Lenin argued in March 1918 that:

“No one, I think, in studying the question of the economic system of Russia, has denied its transitional character. Nor, I think, has any Communist denied that the term Soviet Socialist Republic implies the determination of the Soviet power to achieve the transition to socialism, and not that the existing economic system is recognised as a socialist order.

“But what does the word “transition” mean? Does it not mean, as applied to an economy, that the present system contains elements, particles, fragments of both capitalism and socialism? Everyone will admit that it does. But not all who admit this take the trouble to consider what elements actually constitute the various socio-economic structures that exist in Russia at the present time. And this is the crux of the question.

“Let us enumerate these elements:

(1) patriarchal, i.e., to a considerable extent natural, peasant farming;

(2) small commodity production (this includes the majority of those peasants who sell their grain);

(3) private capitalism;

(4) state capitalism;

(5) socialism.

“Russia is so vast and so varied that all these different types of socio-economic structures are intermingled. This is what constitutes the specific feature of the situation.” [5]

Back in June 2018 we polemised against the pre-split IBT [6] thus:

“If the IBT, along with the rest of the (Spart) Family were to ask that very empirical question, what relations of production does the Chinese state defend and develop? then they could give only one answer – the Chinese Stalinist bureaucracy use statised property to defend and develop capitalist property relations. This is the total opposite to what Lenin did via the NEP and what all USSR bureaucrats did, even Gorbachev up to the late 1990s; they used a certain measures of controlled capitalist production and distribution to guard and develop collectivised property relations. The IBT theory is a reversion to the old Grantite/Militant theory that a workers’ state is defined by the degree of nationalisation. Ted Grant, in The Colonial Revolution and the Deformed Workers’ States written in July 1978 gave us the following hilarious list: “In Vietnam, Laos, Kampuchea, Burma, Syria, Angola, Mozambique, Aden, Benin, Ethiopia and as models, Cuba and China (which in their turn had the model of Eastern Europe as a beacon showing the way) there has been a transformation of social relations” (our emphasis bolded and italicised). [7]

The only conclusion we can draw from this is that the Russian state after October 25, 1917, was a workers’ state, despite the fact that it did not expropriate the capitalists until January 1918 and still had a great many capitalist elements in its economy long after that, because it sought to defend and develop socialist property relations from the beginning (initially via workers’ control, which failed) and the Chinese state is capitalist since October 1992 because it has sought to defend and develop capitalist property relations since then with no significant internal opposition in the Communist Party of China (CCP) to that course.

The Young Mao as a communist fighter

BT falsely equate Mao’s Great Leap Forward with his Cultural Revolution

The following quote from their document is profoundly mistaken:

“The CCP established centralised control of the economy and a monopoly of foreign trade, but China was a very economically backward society with a population that was overwhelmingly composed of peasants and so progress was slow. In an attempt to accelerate development, in 1958 Mao initiated the “Great Leap Forward” (GLF) programme, characterised by having every peasant commune set up its own backyard steel furnace. The disastrous results led to a more pragmatic faction of the CCP, led by Liu Shaoqi and Deng Xiaoping, sidelining Mao and experimenting with some limited market reforms. A few years later Mao counterattacked, branding his factional opponents “capitalist roaders,” and launching the Great Proletarian Cultural Revolution, which raged for a decade and further impeded China’s economic development (our emphasis).”

The preference for Deng over Mao is explicit in the last emphasised section; Mao’s counterattack was a reactionary move as opposed to the more pragmatic and progressive Deng, they strongly imply. Thus, the BT repudiate the world revolution itself and Trotsky’s theory of Permanent Revolution, despite adding it in as a religious genuflection and prayer at the end of the long document. In the first place the GLF of 1958-62 cost at the very least 30 million lives, its rural backyard steel furnace projects were a complete failure because the ‘steel’ produced was useless, and the forced diversion from producing crops to feed themselves caused the greatest famine in human history. But the collectivisation seen in the peasant communes enabled agriculture to revive strongly after the lunacy of the steel furnace projects was halted in 1962 by Deng, just as it did in the USSR after 1933, proving the superiority of centralised state planning, despite its distorted and undemocratic operation. Infant mortality declined sharply, life expectancy increased dramatically over the next decades, from 35–40 years in 1949 to 65.5 years in 1980, because a very pragmatic health service, which did not grant any privileges to doctors or consultants like the British NHS did, was initiated, just as Cuba has done. The GLF was a mechanical repeat of Stalin’s disastrous forced collectivisation from 1929 which caused the Holodomor, the famine in Ukraine and elsewhere, costing some 7-14 million lives. The Cultural Revolution, on the other hand, although it cost 2 million lives, was a direct attack on the BT-favoured capitalist roaders, of which Deng was a central representative. Deng was named Time Magazine Person of the Year for 1978 and 1985 and appeared on its front cover 10 times. Hitler made Time’s top spot in 1938 and President Xi made it in 2017. Mao got no such capitalist adulation. Maoists are leftist leaders today prominent in the unofficial strikes against the capitalist industries, against state theft of commune lands and oppression in general.

The Cultural Revolution from 1966-76 was inspired by a movement from below in the leftist space developing internationally against capitalism in general. The Greensboro, North Carolina, civil rights colour bar sit-in protest took place in 1960, Martin Luther King made his famous, “I Have a Dream”, speech on August 28, 1963, at the March on Washington. By May 1966, the anti-Vietnam war movement was growing exponentially in the US; on May 15 tens of thousands of picketed the White House. Martin Luther King then got on board with his first public speech against the Vietnam War. Civil rights demonstrations were spreading throughout the US in 1966. Inspired by this and other global political developments like the campaign against the murderous apartheid regime of Ian Smith in Rhodesia, the Shanghai Commune began in January 1967.

Mao initiated it by calling for the “seizure of power by proletarian revolutionaries”, but was then horrified when he was taken literally, and genuine proletarian revolutionary internationalists actually took control (remember his was a peasant’s Red Army). He subverted it by manoeuvring to set up the rival ‘Revolutionary Committee of the Municipality of Shanghai’ with leaders he appointed personally. Roderick MacFarquhar and Michael Schoenhals correctly identify this as Mao’s last revolution in their 2006 book of that name. [8] Wikipedia tells us that, “All in all, the Shanghai Commune had lasted less than a month. Between 1968 and 1976, one million skilled workers from Shanghai were sent to rural underdeveloped inner China, officially to share their “revolutionary experiences” and to help develop the country (in reality to disperse them and punish them for their internationalism – GD). Some radical leaders who had opposed the Red Guards that dethroned the Shanghai Municipal Committee in 1967 were publicly executed in April 1968.”

Mao could not tolerate the internationalist aspirations of the Chinese working class, so the Cultural Revolution lost its cutting edge, he could not really unleash the people on the party because this brought with it the danger of outright internationalist proletarian revolution. Remember Chen Duxiu with Li Dazhao were the central figures who founded the Chinese Communist party in 1921, Mao was a minor figure at the time. Chen was its first General Secretary from 1921 to 1927, he remained true to its initial principles, repudiated Mao’s abandonment of the urban working class as the only consistent revolutionary class. He was blamed by Stalin and Mao for the Shanghai massacre although he had strongly opposed the policies that led to it; he was expelled in 1927 for opposing that disastrous course. Trotsky and the Left Opposition (LO) suffered the same fate. Chen remained a Trotskyist until his death in 1942 at the age of 62. When Mao executed Chinese Trotskyists he stuffed their mouths with cotton wool lest the firing squad hear they were executing revolutionary socialists and not counter-revolutionaries as he had dubbed them.

 So, Mao effectively capitulated ideologically to Deng in February 1967. By July 1971, he was secretly hosting President Nixon’s National Security Advisor Henry Kissinger and Nixon himself got the red carpet treatment in February 1972 for a six-day visit. At the time the US air force was carpet bombing North Vietnam’s forests and Vietcong forces with Agent Orange and Napalm, which was OK in Mao’s eyes now because the USSR had become ‘socialist imperialists’ following Khrushchev’s secret speech of 1956 exposing the crimes of Stalin and were then worse than the USA, with whom the by-then completely unprincipled Mao was allied against in Asia, Africa and Latin America. Mao supported Mobutu in the Democratic Republic of the Congo, the USA and the Apartheid regime in South Africa against the USSR-Cuban-backed forces in the Angola Civil War (1975 to 2002) and refused to condemn Pinochet’s slaughter of the Chilean working class leaders in 1973 (social imperialists because they supported the USSR!) to retain his alliance with the global hegemonic imperialist power.

In Angola the USSR and Cuba backed the Popular Movement for the Liberation of Angola (MPLA, Agostinho Neto), the US backed the National Front for the Liberation of Angola (FNLA, Holden Roberto), and China backed the National Union for the Total Independence of Angola (UNITA, Jonas Savimbi). Mao was still alive in 1975. The MPLA were winning the war with the assistance of 36,000 Cuban troops when the favourite of the US far rightist Republican war hawks, Savimbi’s China-backed UNITA, allied with the US and the Apartheid regime and the other strong ally of the US in the region, Mobutu, to serve the interests of US imperialism, a truly shameful act of class treachery to the African masses’ national rights and to the global working class. This failed because the Apartheid regime released Nelson Mandela from Robben Island on 11 February 1990 and their commitment to the war waned as they sought and got class compromise from him. The MPLA and Cuba won that one.

Deng posing as a communisst
Deng as the darling of US capitalism, and the Bolshevik Tendency also.

Why Lenin’s socialist NEP project was the complete opposite to XI’s capitalist project

The BT document says, “China’s integration into the world market has exposed it to the ups and downs of global capitalism, much as Trotsky projected for the Soviet Union during the New Economic Policy:” and they quote from Trotsky’s document, Towards Capitalism or Towards Socialism?

“All the fundamental processes of our economy are not only becoming connected with the corresponding processes dominant in the world market but are also becoming subject in some degree to the operation of the laws dominant in capitalist development, including changes in economic conditions. There arises a situation in which we, as a business entity, are interested within certain limits in an improvement in the conditions in capitalist countries, and in which, on the other hand, we may be made to suffer some disadvantage as a result of a worsening of these conditions.

“This circumstance, somewhat surprising at first glance, is merely a more emphatic expression of the contradiction involved in the very nature of the so-called NEP, already mentioned by us in connection with the narrower limits of the isolated national economy. Our present order is based not only on the struggle of socialism against capitalism, but within certain limits on cooperation between socialism and capitalism.” [9]

Trotsky wrote this document November 1925 when he was highly critical of the direction of the “so-called NEP”. The quotes supplied by the BT from Yevgeni Preobrazhensky, a LO supporter, are from early 1926. The LO had begun to advocate planned industrialisation from 1923. But Stalin was having none of it, his initial troika alliance with the left centrists Zinoviev and Kamenev against Trotsky was always on a shaky foundation and began to unravel from 1925. Trotsky formed the Joint (United) Opposition in early 1926 with Zinoviev and Kamenev advocating inner party democracy against bureaucracy, the ending of the NEP, the development of heavy industry, and denounced the fatal stagist theory of revolution in China which totally subordinated the Chinees Communist Party to Chiang Kai-shek which led to that terrible massacre of the Communists of the Shanghai Soviet in April 1927.

Stalin allied with the former ultra-leftist Nikolai Bukharin, who rejected outright the Brest-Litovsk treaty of March 1918, beginning from 1924 when he adopted Bukharin’s theory of socialism in a one country. Bukharin effectively became a capitalist restorationist rightist; by 1925 he was encouraging the kulak (rich peasant) to “enrich yourselves” and that socialism had to be built at “a snail’s pace”. This is the rightist version of the NEP favoured by the BT, not the temporary and carefully guarded retreat that the Lenin and later the LO promoted until a centralised state planned economy could be initiated. In fact, Preobrazhensky is remembered as a leading voice for the rapid industrialisation of peasant Russia through a concentration on state-owned heavy industry.

The BT even point out the opposing attitude to the NEP held by Preobrazhensky in point 1 and their own attitude to the utterly bogus so-called NEP operated by Xi in point 2:

1.       “The result of this may be such that a too large dose of concessions taken into the organism of the state economy may begin to disintegrate it, just as in its time capitalism disintegrated the weaker natural economy (of feudalism – GD). This disintegration is expressed, among other ways, in the fact that the workers in the capitalist enterprises enjoy better material conditions than the workers in state industry, a fact which will undoubtedly have political consequences” (our emphasis), Preobrazhensky warned in 1926.

2.       “Preobrazhensky’s anticipation of potential difficulties arising from workers employed by capitalist enterprises earning higher wages did not materialise in China where workers in the foreign-dominated export sector earn less and face far harsher conditions than those in the SOEs” (our emphasis) the BT assured us in November 2020; Xi has a far better approach to exploiting workers than those idiots Trotsky and Preobrazhensky we are relieved to learn.

Wikipedia explains:

“The Left Opposition argued that the New Economic Policy had weakened the Soviet Union by allowing the private sector to achieve an increasingly important position in the Soviet economy while in their opinion, the centrally planned, socialised sector of the economy languished (including the mostly state-run heavy industries which were seen as essential not only for continued industrialisation but also defence). The platform called for the state to adopt a programme for mass industrialisation and to encourage the mechanization and collectivisation of agriculture, thereby developing the means of production and helping the Soviet Union move towards parity with Western capitalist countries, which would also increase the proportion of the economy which was part of the socialised sector of the economy and definitively shift the Soviet Union towards a socialist mode of production.” [10]

It must be stressed here that the LO and later Trotskyists never advocated the disastrous panic-led mass collectivisation of the land by Stalin from 1929, or later Mao from 1958, nor did they advocate the autarky of Stalin and Mao but always remained on the programme of Lenin and the revolutionary Bolsheviks, for the world revolution and the understanding that the monster of world imperialism could only be slain at its head, only the working class of the US, UK, EU, Japan, etc. could defeat imperialism in alliance with each other and the working class of the colonies and semi-colonies. For this revolutionary leadership who understood and implemented that programme was necessary; a regenerated Fourth International. And they definitely were opposed to capitalist restoration, refusing all calls for an alliance with Bukharin and Rykov against the murderous brute Stalin. That would have programmatically destroyed their whole political stance in the USSR and later in France and Spain in 1936 and everywhere else against the popular front alliance with liberal capitalists against fascists of Dimitrov from 1935, which of necessity repudiated class struggle and the perspective of the world socialist revolution.

Billionaires, collective assets of the top CCP bureaucrats, and making wills

There is just one passing reference in the BT document to “a layer of Chinese (dollar) billionaires” (1,058 now according to Hurun) in the whole document, and no reference to the 5.3 million millionaires which Credit Suisse records. China’s Gini Coefficient at 38.5 is far worse than most of the former deformed workers states; Ukraine 26.1, Moldova 25.7, Slovakia 25.2, Belarus 25.2. South Africa at 63 is the most unequal country on the planet closely followed by Namibia 59.1 and Zambia 57.1. The Gini Coefficient is a measure of inequality with a figure of 100 representing total inequality and 0 representing total equality. This is the BT quote:

“Yet the seemingly inexorable expansion of market forces, the emergence of a layer of Chinese billionaires, the establishment of a stock market and the country’s apparently seamless integration into the capitalist global economy as a cheap manufacturing platform led many to conclude that capitalist restoration was not only inevitable but imminent.”

And whilst waxing lyrical over the strengthening of SOEs at the expense of private enterprise they neglect to point out that over the last year the number of billionaires has increased by 247, according to Quartz online (data available to the BT three months before they published their article):

“China added 257 billionaires in US dollar terms as of August (2020), adding to the existing 621, according to the annually released Hurun China Rich List on Tuesday (Oct. 20), which has been tracking the wealth of the ultra-rich for 22 years. Overall, China has 878 billionaires, the highest number the country has ever seen. As recently as 1999, there was not a single billionaire in China.” [11]

So, the great expansion of the SOEs saw a modest trickle down of wealth to the more privileged sections of the working class in the cities because of their rising militancy against the ACFTU, less to the poorest migrant workers, of whom there were estimated 286 million in 2020, who are second class citizens, with no rights to healthcare, educations for their children or housing under the appalling discriminatory hukou system in the cities. The China Labour Bulletin has produced a document, Migrant workers and their children, on May 4 2021 which details this brutal exploitation:

“There were an estimated 286 million rural migrant workers in China in 2020, comprising more than one-third of the entire working population. Migrant workers have been the engine of China’s spectacular economic growth over the last three decades, but they remain marginalized and subject to institutionalized discrimination. Their children have limited access to education and healthcare and can be separated from their parents for years on end.

“… The substantial gap in earnings between short and long-distance migrant workers remained stable in 2020, with the average wage of long-distance migrants increasing by 2.7 percent to 4,549 yuan ($702) per month, and the average wage of short distance migrants increasing by 3.0 percent to 3,606 yuan ($557), leaving an overall average income gap of 943 yuan ($145) per month.

In addition to low pay, migrant workers often work long hours, have little job security and few welfare benefits. The NBS survey no longer includes data on working hours, wage arrears, employment contract signing rates, social insurance coverage, etc. However, anecdotal evidence from other sources suggests there has been little improvement in working conditions. Indeed, CLB’s Strike Map regularly records collective protests by low-paid workers in construction, transport and logistics, and a wide-range of service industries over wage arrears, social insurance, and precarious employment.

“The last mention of employment contract signing rates in the NBS survey was in 2016 when 35.1 percent of migrant workers had a contract, significantly down from a high of 42.8 percent in 2009. At that time, one year after the implementation of the Labour Contract Law, there was a concerted push to ensure contracts were signed, but that initiative soon faded and precarious work gradually became the norm, not only in the construction industry where the problem is endemic but in manufacturing, where workers are hired through agencies and on short-term contracts, and in many of the new service industries that are absorbing much of the migrant workforce.” [12]

The neo-liberal gig economy is obviously prospering mightily on the back of this brutal exploitation, Jeff Bezos could learn much from President Xi. Those following the recent strike wave in Iran will note the same neo-liberal economy described here operates there under Supreme Leader Ali Khamenei.

The bulk of the profits from this brutal exploitation, which goes on in the SOEs as well as in the private sector, goes into the pockets of the capitalist billionaires, in whose interests the Chinese Communist Party (CCP) rule.

And Wikipedia tells us that China and Saudi Arabia are growing ever fonder of each other; prior to 1990 Saudi Arabia had refused to recognise the Peoples Republic of China at all but now:

“At present, China and Saudi Arabia are close and strategic allies, with the relationship getting significantly warmer between the two. In a 2015 public opinion poll, 61.3% of Saudi Arabians expressed a favourable view of China, with 34.2% being very favourable, while only 28.5% were unfavourable. In recent years, China and Saudi Arabia have been increasing cooperation in the energy and financial sectors, One Belt One Road Initiative, and has signed numerous deals across several areas. King Salman bin Abdulaziz Al Saud and Crown Prince Mohammad bin Salman also hinted that China could boost its diplomatic footprint in the Middle East, while stating that “Saudi Arabia is willing to work hard with China to promote global and regional peace, security and prosperity”.” [13]

The BT document seeks to rubbish the assertion of the Socialist Equality Party (SEP/WSWS) in their 2012 document, Twenty years since Deng Xiaoping’s “Southern tour, that the SOEs were effectively the “collective assets of the top CCP bureaucrats, who often appointed their children as CEOs.”

“The remaining better-equipped, profitable state enterprises, especially in non-strategic sectors, were transformed into subsidiaries of, or joint-ventures with, foreign transnationals, or became private enterprises in their own right. A small number of state-owned ‘national flagships’ were preserved in strategic industries, such as banking, steel, infrastructure, energy and auto. These effectively became the collective assets of the top CCP bureaucrats, who often appointed their children as CEOs.” [14]

The BT document proclaims in defence of these privileges:

“The idea of the transformation of a Stalinist bureaucracy in a workers’ state into a “collective” bourgeoisie was advanced by “Third Camp” revisionists during Trotsky’s lifetime, as David North et al. are well aware. Perhaps the reason they have thus far attempted to dance around the issue, rather than seriously engage with it, is that they are uncomfortable being aligned with Bruno Rizzi, James Burnham and Max Shachtman against Trotsky.”

Only it is not a workers’ state; it is widely known that the ‘Princelings’, mainly sons (some daughters now) of the top bureaucrats, were appointed as CEOs of the state enterprises and also became the first billionaires in private industry after 1999. These also squirrel away their wealth in places like the British Virgin Island, to escape taxes like the rest of the world’s corrupt billionaires, with state assistance or at least tolerance, as everywhere else. In January 2014 James Ball and the Guardian US Interactive Team informed us that:

“More than a dozen family members of China’s top political and military leaders are making use of offshore companies based in the British Virgin Islands, leaked financial documents reveal. The brother-in-law of China’s current president, Xi Jinping, as well as the son and son-in-law of former premier Wen Jiabao are among the political relations making use of the offshore havens, financial records show … The Hong Kong office of Credit Suisse, for example, established the BVI company Trend Gold Consultants for Wen Yunsong, the son of Wen Jiabao, during his father’s premiership — while (accountants) PwC and UBS performed similar services for hundreds of other wealthy Chinese individuals.” [15]

It is worth pointing out here that professional politicians that defend the interests of their capitalist ruling class are not necessarily capitalists themselves, although there are many such in China and leaders like Xi, Trump and Italy’s Berlusconi are actual capitalist billionaires; Margaret Thatcher was not (only £10 million) and nor were many others, especially the Labour leaders, who were and are merely servants of capitalism. And the corrupt and privileged mass murderer Joe Stalin had no personal wealth at all and could leave nothing to his children; his daughter Svetlana Alliluyeva defected to the US in 1967 with no personal assets.

The BT document actually quotes from Trotsky, in his great Marxist classic, The Revolution Betrayed, observing that Stalinist bureaucrats in the Soviet Union in the 1930s were acutely aware of the “instability” of the source of their privileges and would jump at a chance to be upgraded from a “director of a trust” to a “stockholder”, seemingly blissfully unaware they are shooting themselves in the foot politically:

“One may argue that the big bureaucrat cares little what are the prevailing forms of property, provided only they guarantee him the necessary income. This argument ignores not only the instability of the bureaucrat’s own rights, but also the question of his descendants. The new cult of the family has not fallen out of the clouds. Privileges have only half their worth, if they cannot be transmitted to one’s children. But the right of testament is inseparable from the right of property. It is not enough to be the director of a trust; it is necessary to be a stockholder. The victory of the bureaucracy in this decisive sphere would mean its conversion into a new possessing class. On the other hand, the victory of the proletariat over the bureaucracy would insure a revival of the socialist revolution. The third variant consequently brings us back to the two first, with which, in the interests of clarity and simplicity, we set out” (our emphasis). [16]

Of course, there has been no such inhibitions in China for some 40 years when the accumulation of wealth began under Deng was supposed to substitute for Mao’s Iron Rice Bowl (the welfare state). Mao made private property illegal from the early 1950s, and so no wills were possible, but Deng abandoned that in the early 1980s. The “new rising possessing class”, who had not as yet achieved state power, had nonetheless secured the right to private property. One of the big problems facing the bureaucrats today is wealthy property owners dying intestate leading to protracted court cases by their offspring.

We entirely agree with the WSWS/SEP here:

“Deng’s victory was consolidated at the 14th CCP congress in October 1992. The message from the gathering was, according to China specialist Michael E. Marti, ‘nothing short of opening China to a foreign capitalist invasion’. The ‘socialist market economy’ meant embracing every aspect of capitalist economy, from the establishment of financial and securities markets, to the destruction of state enterprises.” [17]

And with the IMT’s John Peter Roberts whom the BT document quotes:

“The return of capitalism [in China] was an ongoing and complex process but it is possible to date the process by the Central Committee meetings at which key decisions were made. We can see that the transition lasted from 1982, when selected SOEs began to produce outside the state plan according to market forces, to October 1992 when the 14th CCP Congress finally buried state planning and the monopoly of foreign trade and agreed to begin wholesale privatisation of SMSOEs [Small and Medium-sized SOEs] with the perspective of selling-off the larger companies as soon as suitable arrangements could be made.”

John Peter Roberts published a book on this in 2016, China: From Permanent Revolution to Counter-Revolution. We have nothing to disagree with in this review:

“This book answers the questions: – What was the class composition and class nature of the Chinese Communist Party when it took power in 1949? – What forces pushed the Mao regime, despite its explicitly class-collaborationist strategy, to take measures which were objectively socialist and to establish the Chinese workers’ state? – The Chinese Revolution was a practical test of both Trotsky’s theory of permanent revolution and Mao’s theory of uninterrupted revolution by stages. Which theory matched reality? – The degeneration of the Chinese People’s Republic has confirmed that without a political revolution, a Stalinist regime will inevitably return to capitalism, but how did that process unfold? The author also argues that the policies adopted by the Chinese Communist party towards women were a direct measure of its revolutionary commitment. Throughout the book, how the activities of the CCP impinged upon the mass of Chinese women is used as a measure of its socialist credentials. This book also describes how the return to capitalism has meant that many of the gains made by Chinese women have been, and are being, taken away.” [18]

We had initially accepted that the capitalist state was restored when Deng got the acquiescence of President Jiang Zemin after his Southern Tour in 1992 but a brief conversation with a supporter of Workers Power convinced us that the 14th Congress in October was the crucial point of the transformation of opposites; “Socialism with Chinese characteristics” and the “socialist market economy” were almost unanimously accepted and no significant opposition remained within the top leadership or second layers of the CCP to capitalist restoration. The only question that remained was how best to do it; the CCP bureaucrats had to avoid the disaster of the USSR under Yeltsin at all costs which would cost them their positions of privilege.

It is worth quoting an answer from Tom Wetzel, a former philosophy professor, to the Quora question, How is China a communist country with so many billionaires?

“The ruling elite in China — and their party, the Chinese Communist Party — really have nothing to do with communism — if we are using “communism” here in the sense derived from the historical socialist movement. China is a thoroughly capitalist country and that is why there is a sizeable elite of wealthy capitalists — owners of various kinds of businesses. The elite hold onto the name “communist” for the party because they don’t want to lose face and because occasional socialist rhetoric helps to bolster the party’s sense of legitimacy to rule.

“… In China they also went through a shift like that (in the USSR under Yeltsin) towards seeing a capitalist future for China. But the elite pursued this change in a more controlled way, without throwing off the old Communist party. They needed the party’s monopoly of state power to be able to push through the new direction for China while keeping a lid on potential unrest. They had just gone through the faction fight of the period of the so called Cultural Revolution — and the pro-capitalist faction had won.

“So, the top party cadres evolved a system where they allow various people to gain private ownership of land and other assets — often by stealing the land from peasants. China’s direction since the ‘90s has allowed vast foreign investment by multi-national capitalist firms — using the country’s large and educated workforce. But this is part of a multi-faceted capitalist development strategy that also aims to use public assets and investments as well in building private fortunes — and often families of leading party cadre are related to some of the new class of billionaires or multi-millionaires.

“So, there is a continuity with the old “communist camp” regime of the Maoist era in the tight power of the party elite and the elitist focus on a dominating class — except that over time this shifted from the party-state bureaucracy to a ruling class that is more a mix of capitalist wealth and party-state bureaucracy. A kind of state-directed capitalist development.

“The party-state machine is very useful to this emergent capitalist class because of its repressive power to keep the working class in China in line — using the police power for example to prevent the development of authentically independent union organizations which would give the working class a vehicle to challenge the elite at the top. Instead, the official All-China Federation of Trade Unions is about as fake as the fascist trade unions in Spain under Franco or in Italy under Mussolini. A tight one-party corporatist regime is highly advantageous to the exploiting, dominating class of owners and bureaucrats at the top. So, China’s evolution has it more akin to a kind of fascist regime.” [19]

We don’t agree with the last sentence, but the rest is fair comment.

The bogus All China Federation of Trade Unions

The BT document tells us that:

“China’s move up the global value chain is evident in its development of solar panels, smartphones and 5G technology. Nouriel Roubini, a leading American economist, succinctly summed up the overheads that U.S. attempts to exclude China’s Huawei from participating in the development of 5G infrastructure would impose on America and its allies:

“The 5G of Erickson and Nokia costs 30 percent more than the one-off Huawei and is 20 percent less productive. So to install non-Chinese 5G networks, we’re going to pay 50 percent more.”

“The All-China Federation of Trade Unions (ACFTU) has been instrumental in the CCP’s effort to contain social unrest by upgrading wages and working conditions in foreign-owned enterprises” the BT gush in admiration. They continue with fulsome praise of the ACFTU, quoting approvingly from Suki Chung, Workers’ Struggles in China, 2013 [our translation, they explain]:

“The All-China Federation of Trade Unions (ACFTU) has been instrumental in the CCP’s effort to contain social unrest by upgrading wages and working conditions in foreign-owned enterprises … Multinational and foreign companies are particularly affected by the nationwide campaign for ‘unionisation’ initiated in 2008/2009. Many Fortune 500 companies active in China, including Walmart and Coca Cola, have been pressured by the ACFTU to form unions … Linked to this is the clear political intention to ensure ‘social stability’ by regulating capital competition and labour relations. Our research also shows that most of the ‘consultations on wages’ and the establishment of trade union organisations were initiated by higher union bodies and are not the result of strikes”(our emphasis).

Suki Chung’s Workers’ Struggles in China is available in English now [20] and it tells us much more than that bland assumption of the good intentions of the ACFTU:

“From 1993 to 2006, the number of strikes by workers and incidences of peasant unrest increased from 8,700 to more than 90,000. Some scholars even estimated that the number of mass incidents has accumulated to more than 180,000 in 2010.[1] The growing mass discontent exposed the anti-people nature of China’s economic-oriented and undemocratic development strategies. It is noteworthy that President Hu Jintao also accepted that the country was facing a period of magnified social conflicts.[2] Mass incidents as seen in strikes, demonstrations and riots increased from more than 60,000 to more than 80,000 from 2006 to 2008. In 2009 alone, there were 90,000 mass incidents of social unrest in China. The trend has continued in the following years.[3]” [21]

Of course, it was and is the militancy of the working class in China, independently of and in conflict with the state and its organ the ACFTU, that has achieved rising wage levels and better conditions. We would mention Suki’s Labour Action on China is an NGO based in Hong Kong funded in all probability by some arm of US imperialism. Of course, it would strongly discourage the notion of working class self-emancipation and therefore would favour the course taken by the ACFTU. The IBT tell us that, “Many Fortune 500 companies active in China, including Walmart and Coca Cola, have been pressured by the ACFTU to form unions” but neglect to tell us exactly why these companies accept the ACFTU so readily. When the ACFTU requested to be recognised by Walmart, the corporation which will not willingly accept trade unions in their workforce anywhere else in the world, immediately accepted. “No, no, no, the ACFTU admonished them, you must refuse our demands, we will conduct a vigorous campaign against your refusal and then you can reluctantly accept our demands – understood?” That’s the relationship of this bogus trade union federation to the Chinese working class. Trade union law allows the company management to appoint the representatives of the Enterprise Trade Union (ETU); a component part of the wider CCP-led ACFTU. ACFTU aims are to increase production, marginalise, beat up and, if necessary, assassinate any militant workers.

Let us not forget the fate of the Beijing Workers’ Autonomous Federation (BWAF), which led the attempted political revolution during the Tiananmen Square uprising of June 1989. The BWAF denounced political corruption, presenting itself as an independent union capable of “supervising the Communist Party,” unlike the party-controlled ACFTU. The People’s Liberation Army’s brought units in from its far flung regions because the city units were sympathetic to the workers. They began the slaughter on the morning of June 4 and continued for 8 days. The state then declared the BWAF and its many nation-wide supporters an “illegal organization”, its leaders arrested and many executed. The ACFTU fully endorsed this slaughter of trade union militants. The only trade union that is allowed to operate in China is the ACFTU, all others are illegal. The workers were treated far worse than the students who had initiated the occupation, who wanted capitalist democratic rights only, implying capitalist restoration, with which Deng sympathised. But the emergence of the working class as the central player was brought with them the appalling vista of revolution and undoubtedly it was he who ordered and organised the massacre.

This is the happy tale of the trade unions in China, as related by Rob Griffiths, general secretary of the Communist Party of Britain in the Morning Star of 14 June 2018:

“While the 2,663 strikes and protests recorded in 2016 by China Labour Bulletin marked a fall of 112 on the previous year, the total was still almost double that of 2014, with the spread to new sectors partly offsetting a drop in manufacturing unrest. Most strikes in China are for unpaid wages, not a very good indication of the effectiveness of the All China Federation of Trades Unions (ACFTU).

“Nevertheless, Mr An Jianhua (ACFTU head of the international department) was challenged about changes in China’s constitution which removed the explicit right to strike in 1982, although the 2001 basic law on trade unions acknowledges the reality of industrial action.

“It is not the case that striking is illegal in our country. Furthermore, the National People’s Congress and the judiciary can interpret existing laws and take decisions in the interests of the working class. In any event, strikes are not an effective way of solving the problems of the working class in China. In today’s globalised environment, the pressure of competition means that there are contradictions not only between workers and capitalists at home, but also between Chinese enterprises and foreign capitalists,” he adds. As a result, “strikes are neither in the interests of workers nor capitalists in China”, he maintains. [22]

Obviously in China the interests and the capitalists and workers have become identical, unlike in the capitalist west, according to Mr An and the ACFTU, the Morning Star/CPB, and the BT.

And this from 18 March 2018, “Eight-day strike at China factory making Michael Kors bags ends as workers’ pension and wage demands met. South Korea’s Simone Accessories Collection, which once operated five factories in the southern Chinese city, agrees to workers’ demands on pension and housing provident funds.” [23] Seems rather effective to us.


The BT finish their document thus:

“The 1949 revolution ended imperialist domination, smashed the existing bourgeois state apparatus and opened the door to the creation of a collectivised economy. Ultimately the preservation of these gains will depend on the resurgence of revolutionary proletarian struggles internationally, particularly within the citadels of imperialism. While impressionists and pseudo-Trotskyists may characterise China as “capitalist,” we in the Bolshevik Tendency take seriously Trotsky’s admonition that: “It is the duty of revolutionists to defend every conquest of the working class even though it may be distorted by the pressure of hostile forces. Those who cannot defend old positions will never conquer new ones”.”

Well, we ‘Trotskyist’ impressionists’ take seriously:

1.       The emancipation of the working classes must be conquered by the working classes themselves.

2.       Stalinism cannot do this, Stalinism is one of two counter-revolutionary global workers internationals, the other being Social Democracy.

3.       China’s capitalist billionaires can never bring socialism to China and nor are they defending proletarian property relations.

4.       Their obscene privileges in this highly unequal country are not examples of “Socialism with Chinese characteristics” or the “socialist market economy” but simple corruption.

5.       The whole Spart/ICL/James Robertson tradition represents contempt for the working class and its organisations as represented by its ludicrous theory of ‘interpenetrated peoples’, a defence of imperialism itself with a Marxist gloss.

6.       The interests and the capitalists and workers are completely opposed and not at all not identical in China or anywhere else. Mr An Jianhua (ACFTU head of the international department), the ACFTU as a whole, the Morning Star/CPB, and the BT are profoundly mistaken on this.

Finally for rivals to the BT document see the Facebook pages of John Ross, formerly of the International Marxist Group: US-China Trade War Updates & Global Implications and Denis Etler (died on June 3, 2021): Xi Jinping – China’s Exceptional President. [24]


[1] Gerry Downing, 28-1-2016, Ireland and Palestine: Interpenetrated peoples and the rights of oppressed nations to self-determination,

[2] BOL-EA, 4th August 2021, Capitulation to Imperialism, Neutrality and ‘BT’ ,

[3] The Marxist Theory of the State; the Formation and Destruction of Workers States,

In Defence of Trotskyism No. 6, Deformed and Degenerated Workers’ States and Capitalist States Reply to RCIT Part 3 (assessment also of the positions of Workers Power/LFI, Ted Grant and the Socialist Party/CWI, Socialist Appeal/IMT, the Spart family ICL/IBT/IG, Mandelites/USFI/US SWP, David North’s SEP/WSWS/ICFI and a passing look at the Cliffite UK SWP, //

[4] Writings of Leon Trotsky (1937-38), p.65, p.61

[5] V. I. Lenin, The Tax in Kind, (The Significance Of The New Policy And Its Conditions), Written: Completed on 21 April, 1921 (started in March),

[6] Socialist Fight, Gerry Downing, 30-10-18 IBT split; Spartoid contempt for the working class and oppressed nations, Robertsonian Stalinophilia; sectarian third period on British Labour and concomitant imperialist apologia and Gerry Downing, 6-11-18 IBT Split: The Asian Anti-imperialist Marxist opposition

[7] Socialist Fight, Is China still a deformed workers state?

[8] Roderick MacFarquhar and Michael Schoenhals, Mao’s Last Revolution, Belknap Press of Harvard University Press, Cambridge, Massachusetts, ISBN 9780674023321.

[9] Trotsky, Towards Capitalism or Towards Socialism?

[10] Wikipedia, Left Opposition

[11] Quartz, A RICH MAN’S WORLD, China is rapidly producing new billionaires despite Covid-19,

[12] China Labour Bulletin, 04 May 2021, Migrant workers and their children

[13] Wikipedia, China–Saudi Arabia relations,

[14] WSWS, John Chan, 26 November 2012, Twenty years since Deng Xiaoping’s “Southern tour”,

[15] The Guardian, James Ball and Guardian US Interactive Team, 21 January 2014, China’s princelings storing riches in Caribbean offshore haven

[16] Leon Trotsky, The Revolution Betrayed, What is the Soviet Union and Where is it Going? (1936),

[17] Opus Cit, WSWS John Chan.


[19] Quora, Tom Wetzel, former philosophy professor. Answered September 10, 2018, How is China a communist country with many billionaires?

[20] Labour Action China Suki CHUNG, December 17, Reflections on the recent trends in China’s labour movement,

[21] Ibid. With its own footnotes: [1] (Radio Free Asia) 09-10-2011; Quote from Los Angeles Times, 2011. See:

(Sin Chew Daily)20-2-2011;

[3] The Chinese Academy of Social Sciences, the Blue Book of China’s Society 2010; quoted in Wall Street Journal, ‘Unrest Grows As Economy Booms’, 26 September 2011.

[22] The Morning Star, Chinese unions grow in numbers and strength, ROBERT GRIFFITHS reports from a recent meeting in Beijing between the Chinese trade union movement and Western communist parties

[23] South China Morning Post, Eight-day strike at China factory making Michael Kors bags ends as workers’ pension and wage demands met, South Korea’s Simone Accessories Collection, which once operated five factories in the southern Chinese city, agrees to workers’ demands on pension and housing provident funds,

[24] See John Ross’s Face book page for its grovelling to Xi, US-China Trade War Updates & Global Implications And Dennis Etler for his even worse grovel: Xi Jinping – China’s Exceptional President

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