The New Cold War, Part II

 “China 2020” – Monthly Review, Vol. 72, No. 5, October 2020

This edition of Monthly Review focuses on China exclusively. It includes a revealing article on the current trade war between China and the U.S., which is part of a new cold war.  Unfortunately it never mentions Russia as a target of the new cold war as well.  It has two helpful articles on two lonely but successful Chinese rural cooperatives.  Lastly an article on debt growth in China.  They are all written by “critical Marxist” professors from Beijing, Fujian, Chongquing and Hong Kong, China.  “Critical Marxism” seems a phrase that is redundant.  John Bellamy Foster’s introduction notes the variegated nature of the Chinese economy, calling it ‘unique’ and “indeterminate, neither entirely capitalist nor entirely socialist.”

In a way, this edition tries to hide the gap.  The two stories on successful cooperatives/communes that resisted the tide of privatization or the 1982 Household Responsibility System (HRS) is set against a sea of monetarism, individualism and the market in rural areas.  References are made to a new initiative by the CCP, “rural revitalization,’ attempting to ‘delink’ (S. Amin’s concept) the Chinese economy from imperialism and build it up internally.  But the essence of this revitalization is undefined.  Foster insists that China’s land is public property, but like Mexico, the land can be and is being ‘transferred’ to large private agricultural entities and real estate developers by peasant households and local governments.  One article is seemingly happy at this prospect. They hope that “top-down and bottom-up movements are integrated into delinking…”  Hmmm…

Of most use is an excellent analysis of labor arbitrage and unequal exchange vis-à-vis the U.S. and China.  The authors look at the last 40 years of production and trade between the two, in different sectors.  China traded 50 hours of Chinese labor for 1 hour of U.S. labor in 1995, but now the ratio is 7 hours to 1 hour in 2014.  Between 1995 and 2014, 43 out of 55 sectors transferred value to the U.S. from China – to the tune of $100B.    The remaining sectors advantaged China – technology, agriculture, pharmaceuticals and others.  These are the sectors that are now subject to the trade war.  The authors understand that Trump is a representative of one faction of the U.S. ruling class, which they call the ‘continentalists’ as opposed to the ‘globalists.’  So this is really a capitalist competition issue, it is not about ‘unjust’ methods.  And you wonder why Huawei, TikTok and WeChat are suddenly at issue?  It’s not ‘security’ as it’s been reported that TikTok, like all software platforms, shares data with U.S. police.  Talk to Mark Zuckerberg instead…

The authors also dissect the claim than the Chinese currency, the yuan, is undervalued.  They say that by 2010 China’s GDP/Balance of payments left the yuan in a ‘reasonable’ relation to the exchange rate with the dollar. 

Two articles discuss the socialistic functioning of the Zhoujiazhuang and Puhan rural communities.  Zhoujiazhuang rejected the HRS in 1982 and continues as a very successful and well-off cooperative involving almost 7,000 people in 6 villages.  As part of membership every farmer must convert to organic agriculture.  It is run on a democratic basis, producing food and fruit in an increasingly productive way for sale and consumption.  It plows most money back to the farmers, with 30% for general social needs.  The cooperative/commune gives low-interest or no-interest loans and provides ecological agricultural advice, medical clinics, schools and elder care.  Mao denounced it’s method in 1963 as ‘trivial,’ ‘impractical,’ and only for ‘intellectuals.’  Its leader was imprisoned during the Cultural Revolution but when he was released the method was reinstated. 

Scale is important, as cooperatives that are too small cannot survive, while those that are too big become bureaucratic and unwieldy and unproductive.  The CCP vacillated, first ordering very large communes, then small ones, then abandoning the idea entirely. This commune found the right size.

The second example is the Puhan rural community, which handled finance by first being involved with a capitalist micro-finance firm that charged too high an interest.  They rejected this for relations with a Hong-Kong non-profit that charged lower rates.  Ultimately they formed their own mutual-aid credit union, distributing profits like Zhoujiazhuang.  They also promote ecological agriculture and in the process, like Marx, focus on soil fertility. 

What is true is that cooperatives exist even in the interstices of the capitalist world. Certainly Zhoujiazhuang seems highly developed and there is great potential in the Chinese countryside given its revolutionary history and present economic structure.  Yet Cuba has a far higher rate of organic agriculture than China at this point.  So while these stories are encouraging, they don't clearly relate to the direction of China or its class character.  This is something the authors might have wanted to show by implication. 

 Anyway, a good MR edition to keep up with events concerning China.

May Day stocks many left-wing newspapers and magazines, including Monthly Review, Jacobin, Labor Notes and others.

Prior blog reviews on this subject, use blog search box, upper left:  “The Musings of the Professors,” “The Cultural Apparatus of Monopoly Capital,” “The Fall of Bo Xilai,” (all on Monthly Review) and “Two Sea Changes in World Political Economy,” “Is the East Still Red?” “From Commune to Capitalism,” “The End of the Revolution,” “Jasic Factory Struggle,” “China’s New Red Guards,” “The Rise of China,” “Maoism & the Chinese Revolution,” “Striking to Survive,” “China on Strike.”        

And I bought it at May Day Books!

Red Frog

October 6, 2020