China develops as capitalism is mired in crisis

By Heiko Khoo
0 Comment(s)Print E-mail, March 8, 2012
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Steady advances [By Jiao Haiyang/]

Steady advances [By Jiao Haiyang/]

Chinese Premier Wen Jiabao's Work Report of the Chinese Government re-iterated a shift in emphasis towards the quality rather than quantity of growth, as elaborated in the nation's 12th Five-Year-Plan (2011-15). Historically speaking, the question of quality was always the weakest link in a planned economic development. Driven by the need to catch up with developed countries, planned economies concentrated on investment in capital-intensive industries and relegated the consumer to a secondary priority. They were able to mobilize and concentrate resources rapidly without private capital. However by the 1980s, stagnation seemed to strangle the communist vision, lethargy conquered enthusiasm, and cynicism drowned out revolutionary idealism.

In circumstances governed by economic stagnation, the finest words and ideas bore little weight against the power and glitter of the capitalist world. The isolationist and semi-autarchic model, which stemmed from Stalin's theory of Socialism in One Country, collapsed like a house of cards. It appeared that capitalist property relations would reign supreme and all efforts to stop this tide would be hopeless.

China's pathway since 1978 has been widely characterized as gradual advancing of capitalism into a planned economy; starting in agriculture, spreading to special economic zones and finally reaching the urban areas and state enterprises by the late 1990s.

The Great Recession shifted the global geo-political, economic and intellectual paradigm. The wealthiest capitalist countries entered a period of profound stagnation and China's planning system proved its vitality and resilience by radically adjusting its focus towards state investment, introducing big improvements in the living standards and welfare of the masses.

The emphasis on green growth, improving workers' living standards, housing the urban masses, providing universal health care, pensions and welfare, makes the 12th Five-Year-Plan one of the most radically progressive economic programmes in history. The proposal for a swift move to counter excessive inequality generated over the last ten years, constitutes an important component of any strategy to improve the quality of social and cultural life.

The World Bank Report China 2030, asserts that China is reaching a point where the emulation of existing techniques and methods will no longer produce rapid growth. This seems far-fetched. Public ownership and openness to the world provide the two key foundations for success in this sphere. The rapid assimilation of ideas and methods developed elsewhere is helped by open markets, international labor mobility, modern communications and computing. Public ownership facilitates the widespread replication and application of this knowledge and technique, in order to serve society.

In an increasingly unequal society, social discontent over unjust enrichment inevitably consumes the minds of those less well-off. Whilst few will begrudge the wealth of a hardworking entrepreneur, someone who becomes wealthy through illegal land sales, corruption or ruthless exploitation of their workers rightly evokes feelings of rage amongst the masses. Where the working classes believe they can defend their rights and participate in democratic decision-making at work, they not only become more confident and willing to take militant action, but also gladly contribute to serve collective objectives.

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