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| The enigma of Chinese socialism (3/3)
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The "Wall of New York" and the road to world power. By Thomas de Toledo
This article concludes a trilogy that launched historical clues to answer the question: what is the relationship between China's socialist regime and its economic success? The first article examined the political, economic and ideological bases on which the Chinese Communist Party of China founded the construction of its project. In the second, it was understood that China has married socialism to the market economy, starting a journey that continued for over three decades of uninterrupted growth in the highly productive base. In this latter article, the objective was to seek to understand the relationship of its socialist project with its tendency to rise as a world power in the new scenario after the fall of the “Wall of New York" in 2008.
This crisis has shaken the foundations of neo-liberalism and seen the intensification of three new phenomena, all related to the future of the Chinese economy and world: a) the fall in developed countries, i.e. the U.S., Europe and Japan; b) the rise of new powers, driven by China, India, and followed by Brazil, Russia and other countries; c) the recognition of the failures of the neo-liberal model in both the periphery and in central capitalist countries leading to a re-articulation of the role of the state and turning it towards development.
Thus, Chinese socialism, combined with the market economy and strategic planning in the short, medium and long term and in a stable system, enabled a great advance for civilization, a country that rose from a poor predicament and that in the XXI century will be very important in major decisions of the new international world order.
Strengthening China after the fall of the "Wall of New York"
On September 15, 2008, Lehman Brothers, a traditional U.S. bank, declared bankruptcy as a result of the damage caused by sub-prime securities, sparking a number of other failures in financial markets. The crisis struck the center of the world capitalist economy, the U.S., requiring from the Bush administration, followed by Obama in 2009, to implement a series of packages to avoid local and global trillionaire bankruptcies. The neo-liberal economic model imploded on its foundations, and the entire planet has been shaken. Even so, China has remained stronger.
With the fall of the Berlin Wall in 1989, the Chinese have faced various internal and external threats to its political regime. In the fall of the "Wall of New York" in 2008, its regime managed to maintain stable and fast economic growth. At first, the USSR collapsed, and China slowly rose. In the second, its rival, the U.S., continues in a falling position and China keeps rising up. Thus, it becomes increasingly clear that the two major powers of the early decade of 2010, the U.S. and China, are following inverse trends: while the U.S. economy declined 2.4%, the Chinese one rose 8.7% in 2009.
The contrast between these two countries is also observed in the geopolitics of the Far East. China has strongly criticized the U.S. for maintaining its traditional alliance with the separatist leader in Tibet, Dalai Lama, and support for military innovation of Taiwan, through the provision of modern weapons. There is also the problem of nuclear weapons by North Korea, which is under strong U.S. pressure, but has the support of China, which also has veto power in UN Security Council. What the U.S. has for sure is that for apparent reasons, there is no interest in an open confrontation with China, because despite its apparent military inferiority, this country is able to attain a record that in many respects is symmetrical. However, this scenario is virtually ruled out because there is a relationship of interdependence between these two countries.
While the U.S. is the most important market for China, China is the largest funder of the U.S. external deficit. China does this, because rising trade surpluses have been accumulating, which has resulted in foreign exchange reserves exceeding US$ 2 trillion, closing a highly favorable circle for the Chinese. With excess dollar reserves, China began to direct their exchange towards a basket of currencies. The U.S., Europe and developing countries have criticized the sharp devaluation of the Yuan, since in this configuration it benefits Chinese exports and discourages imports, as China has similar products in its domestic market that still has high barriers to entry.
Despite criticism, China has changed little in its macroeconomic policy, but in terms of strategy, has directed its development plan towards the internal market, reducing dependence on the external market. Despite having reduced the rate of growth of GDP over the past two years, China has an outlook of high growth for 2010, between 8% and 9.5%. If in 2009 the country overtook Germany as the world's largest exporter, and has reached the position of third largest economy, preserving the forecasts for 2010, China will overtake the Japanese economy, and arrive in second place behind the U.S. with which it shares the position as the largest polluter on the planet.
For China, there is no way of being larger than the U.S. economy without overcoming major internal challenges. While China’s per capita income is averaging US$ 4,000, for the U.S. is US$ 29,000. It is noted that China has more than four times the U.S. population, and that more than half of its population still lives in the countryside. Also in China there is greater access to public health and education, while in the U.S. these predominate as private services.
New articulation of emerging forces
An analysis of the growth of the global position of China would be incomplete if it did not include the advancement of emerging countries, mainly the BRICs (Brazil, Russia, India and China). This considering the weakening U.S. economy and also Europe, where it has ended up with the crisis undermining the Euro because of Greece, with other PIIGS (Portugal, Italy, Ireland, Greece and Spain) likely to be affected. So while powers emerge, powers fall.
Russia and China have a historic rivalry that dates back to the times of USSR, with which it underwent several tense circumstances in the Cold War. India, which also borders China, has been experiencing strong economic growth and seeks a partnership with them due to the delicate balance of forces in the region. Among these three countries, there is concern about radical Islamic movements leading regional separatist movements that are mobilized from Afghanistan and Pakistan, where there is open conflict with similar organizations. To complete the concern of Western powers of the Asian position over Iran’s nuclear program, the Chinese position is mostly very close to that of Brazil and Turkey, giving priority to negotiations instead of imposing sanctions.
With the rise of Chinese economy, its range of relationships and influence has extended to Africa and Latin America. In Africa, there are heavy intakes of public and private investments in Chinese infrastructure works for mining and other primary activities. In Latin America, where there is an important market for its products, China has also invested in infrastructure and primary production. In Brazil, which supplies much of the food and minerals that China consumes, it recently acquired electricity companies worth R$ 3 billion, and there are prospects for new investments.
What makes China respected among the emerging developing countries is that despite its economic clout, this country does not impose its imperialist hegemony in order to compete with the United States. For the poorest, their investments often represent a large increase to very underdeveloped economies.
China does not want to export its revolution
Instead of imposing their national and cultural values as if they were universal in the way the U.S. does, often through war, China has had for decades a tradition of nonintervention in internal affairs of other countries. Thus, the Communist Party of China must remain firm in its revolutionary purpose concerning its borders, and when asked about a project for world hegemony, it responds like Prime Minister Wen Jiabao, who says it is still in the "first stage of development," and this modernization process will take "one hundred years."
At this stage, therefore, as good Marxists, they interpret it to be necessary to consolidate the production bases combining elements of capitalism and socialism. Marx recognized the market as a historical creation long before capitalism, and the Chinese, even in the transition to a purely socialist economy will need to cope with the marketplace. According to the plans of the Communist Party of China, the ultimate goal still is to create a communist society without classes and without the state. However, if they predict it will take a century to leave the primary stage of socialist transition, who would say how long it will take to get to communism?
Since we cannot say what the size and what the role of China are in the future of the century, we can clearly emphasize that the socialist market model with its own characteristics was largely responsible for the success earned so far. Marxist philosophy of Chinese civilization has added a concept of transformation of the economic material base, thought to cause historical changes in the long run. Without addressing the economy with dogma in favor of the interests of one social class, the Chinese Communists seek to work for all the people of the country, according to its statutes. This model can in part be compared with Keynesianism, which proposes a strong state acting in a capitalist economy. With the crisis of 2008-2009, the foundations of neo-liberalism succumbed and gave way to the developmental state. One result is that increasingly the world looks with less prejudice toward the Chinese model and even in countries with a strong liberal tradition, certain Chinese precepts are accepted, with example.
Despite all these economic achievements, there is a lack of more freedom of thought and speech in China as well as participation of society in politics. However, this should be dealt with according to Chinese traditions and formulas, without imposing the Western model of formal democracy on the country. In an era of global integration for communication and transport, at some point the Chinese leadership will be required to review these restrictions and understand this as a civilizational advancement of maturity.
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Consultant in economic development for the Amazon region, he holds a Master Degree in Economics by UNICAMP. Graduated in History at USP, is a professor of International Relations at FACAMP.
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