China’s new leaders: a neo-liberal victory?

The stand-out thing for me in China’s changeover of power as incoming President Xi Jinping takes his place at the helm, is the move towards privatisation. The neo-liberal economist Zhang Weiying keeps citing the west’s dependence on the market as justification for their abandonment of any socialist ideals of an equitable society despite the disasters these Milton Friedman-influenced policies have wrought in America and Europe. The ditching of the US Glass Steagall Act (separating investment and savings banks) and the banking crisis should be one of several salutory lessons but, with big bucks at stake, the elite is ploughing on never-the-less.

The outgoing Premier Wen Jiabao and President Hu Jintao managed to slow down the rightward drift since Deng Xiaoping set the nation’s capitalist course in the 1980s, but were never going to reverse it. Wen is said to be keen on privatisation, although the fortunes of his geologist wife — once a state regulator of who China’s diamond market and who now owns a fat slice of it — have proven to be an embarrassment. Once seen as progressive (he famously accompanied General Secretary Zhao Ziyang into Tiananmen Square during the protests but luckily didn’t share Zhao’s fate, ending up being promoted rather than purged) his is the kindly face of the new capitalism. And yet, his family is reported to be worth US $2.7 billion — a figure he is disputing all the way into the law courts.

Wen has steered a leftish course, such as resisting US demands to devalue the renminbi — so tiny is the mark-up in Chinese manufacturing which relies on vast volume that even a tiny rise in the interest rate would wipe out a large swathe of their production. However, in 2009, he declined to introduce a huge state stimulus package despite soaring wealth, turning his back on Keynsian policies traditionally favoured by socialists, emboldening the hard-core neo-liberals.

Since the fall of golden boy Bo Xilai — another populist but one whose USP was Mao nostalgia and lip-service to socialist values while filling his boots — the neo-liberals are off the leash, promising to privatise everything that isn’t nailed down and laughing at the notion of public investment. Should they win outright, the only freedom on the cards is the freedom for this bloated layer to stuff themselves with state assets and play catch-up with the Soviet oligarchs. And look what happened to them!

It almost feels like a smash and grab before everything falls apart, although recent figures contradict projections of China’s demise as global economic powerhouse miracle. As in the UK under Tony Blair (what is it with these supposed socialists?), the gap between rich and poor continues to grow but, with the incoming crew, that widening between the haves and have-nots promises to accelerate to a yawning chasm (average annual urban income is $2,000). Whether the centre can hold under the centrifugal pull on social assets spinning off into the bank accounts of former cadre as they pilfer the state, remains to be seen.

The good news is that strikes are on the increase, and workers are being radicalised as their exploitation bites. The excesses at Foxconn seem never to be out of the news even if we keep buying their iPhones in an astonishing failure of solidarity.

Freedom of speech is a lot healthier than you probably realise, the government’s attempts to close it down notwithstanding. Chinese netizens are probably the most populous and active in the world, expressing themselves on internet services such as Weibo. The Chinese have proven creative in getting around blocks, often with hilarous results: such as the Grass Mud Horse and River Crab episodes where the levels of meaning in Chinese characters allow the dissenting public to say much more than first meets the eye, and lampoon the authorities over their corruption. Ai Weiwei’s imaginative sending-up of his tormentors has also proven popular with donations towards his legal case literally flying in over his garden wall, folded into paper aeroplanes.

It’s interesting to note that, despite western criticism of the Chinese lockdown on free expression, a company linked to none other than Mitt Romney has won the contract to put as many CCTVs in public spaces as we have here — they have yet to catch up the UK as being the most surveyed nation in the world.

Perhaps the Mayans were right in their own way. Maybe 2012 isn’t the end of the world, but the end of enlightenment values the world over as the light is switched off. All power to those strikers.

This Saturday I’m appearing in the morning at an all-day event. Socialist Resistance have a full day meeting on developments in China next Saturday in London and meetings all around the country with Chinese suthor Au Loong Yu to launch the new book analysing China’s growth from a Marxist perspective – “China’s Rise: Strength and Fragility” (Resistance Books, IIRE, Merlin Press).

Also read The Changing of the Guard at Socialist Unity.