Issue 238 of SOCIALIST REVIEW Published February 2000 Copyright © Socialist Review


New partnerships, old priorities

David McNeill describes the two sides of life in modern China
All smiles and handshakes as China's leaders sign up to the WTO agreement last year

The conclusion of arrangements for China's entry into the WTO in November last year generated much talk in the mainstream press and elsewhere about the democracy dividends the deal would bring. The Far Eastern Economic Review called it the 'deal of the century', and suggested that it was 'good for trade but also for human rights and the rule of law'. Clinton's security adviser Sandy Berger claimed that it would make China a 'more open and hopefully more pluralistic place'. However, any signs of a peaceful transition to democracy in China were nowhere to be seen at the 'trial' of Wang Youchai.

Wang was one of four members of the tiny China Democracy Party who lost their appeal before Christmas against prison sentences of between five and 11 years for trying to register as an independent political party.

In fact, all the indications are that the state has stepped up its repressive activities. Dozens of democracy activists have been harassed or imprisoned; underground chur ches and cults, notably Falun Gong, have been smashed; and the number of executions for crimes ranging from robbery to treason has climbed steadily. The crackdown is seen by the Chinese leadership as being the only way to deal with the social fallout that continues to be generated by massive economic restructuring.

Since Deng Xiaoping defeated the Maoist faction of the Chinese leadership in the late 1970s a majority of the Chinese ruling class has pushed for a reversal of the economic policies which dominated the country during the rule of Mao Zedong. As in the former USSR, this has principally entailed the selling off of state-owned industries and collectivised agriculture, and the opening up of the Chinese market to trade with the rest of the developed world. Unlike the former USSR, however, where there was a dramatic collapse of Stalinist rule in 1989, the pace of reform in China is being dictated more carefully by the leadership. This has entailed negotiation with other world powers over China's integration into world capital, of which the WTO deal is merely the most successful stage. It has also meant the steady buildup of external military power and an internal security apparatus to control its own population.

There is no doubt that Deng's reforms have brought about a real improvement in the country's raw economic figures. China's GDP quadrupled between 1978 and 1994. Between 1980 and 1993 its volume of foreign trade grew from US$38.1 billion to US$195.8 billion. However, these raw figures hide enormous internal income and wealth disparities. While entrepreneurs have accumulated enormous wealth by taking Deng's maxim, 'To get rich is glorious', to heart, China's average annual wage is only 6,000 yuan (£476), and millions of peasants languish on less than a third of this. It is not surprising, then, that despite strict controls on internal migration many peasants have been pulled to the coastal cities to become part of China's 'floating population' of some 80 million rural migrants.

The city where I live and teach, Guangzhou (Canton), is at the vanguard of China's capitalist experiment and bears the scars. Now skyscrapers and half-completed buildings litter the skyline. It is permanently gridlocked and horrendously polluted--Mercedes, BMWs and expensive military cars with their distinctive red number plates mingle with bicycle coolies carrying impossibly large loads. There are thousands of visibly distressed migrants scratching out a living on the margins of city life.

Despite the harsh conditions, peasants have flocked to places like this and Shenzhen, one of the Special Economic Zones in Canton province. Hong Kong factory owners have shifted across the border into the mainland, where wages are a fraction of the cost, and environmental and safety laws are much more lax. The South China Morning Post reported before Christmas that between one and two workers die and over 400 lose arms or legs weekly in accidents at the workplace in Shenzhen.

Workers in state-owned enterprises, while clearly a step up from these desperate migrant workers, also face increasing uncertainty. Last month Zhang Zouji, Minister of Labour and Social Security, admitted that up to 12 million people would lose their jobs from state-owned enterprises in the next few years as China accelerates its market reforms. Many millions of already laid-off workers, who are forced to live on 100 yuan (under £9) a month, have found themselves having to pay for health and education for the first time. Others have been swindled out of their pensions after state-owned firms used pension funds to speculate on the stock markets. Resentment at miserable living conditions is made worse by proximity to thousands of party cadres, fattened by corruption.

The Chinese leadership is pursuing a risky strategy. The unstable growth of Chinese capitalism is only sustainable at present with massive levels of repression. A downturn in the global economy would exacerbate the tensions I've described. The Clinton administration's one real goal is to open up China to US business interests. Its sponsorship of a resolution critical of China's human rights record at the UN Commission on Human Rights in January has the Chinese leadership's prior knowledge. The Chinese government will complain, the resolution will fail and, the sham successfully completed, the ruling classes of both countries can get on with the real business of making sure that the lives of their own populations come second to making profits.

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