The Integration of China into Capitalist Globalization
We cannot pursue the analysis of Chinese state capitalism (called ‘‘market socialism’’ by the government) without taking into consideration its integration into globalization.
The Soviet world had envisioned a delinking from the world capitalist system, complementing that delinking by building an integrated socialist system encompassing the USSR and Eastern Europe.
The USSR achieved this delinking to a great extent, imposed moreover by the West’s hostility; even blaming the blockade for its isolation. However, the project of integrating Eastern Europe never advanced very far, despite the initiatives of Comecom. The nations of Eastern Europe remained in uncertain and vulnerable positions, partially delinked—but on a strictly national basis—and partially open to Western Europe beginning in 1970. There was never a question of a USSR-China integration, not only because Chinese nationalism would not have accepted it, but even more because China’s priority tasks did not entail it. Maoist China practiced delinking in its own way. Should we say that, by reintegrating itself into globalization beginning in the 1990s, it has fully and permanently renounced delinking?China entered globalization in the 1990s by the path of the accelerated development of manufactured exports possible for its productive system, giving first priority to exports whose rates of growth then surpassed those of the growth in GDP. The triumph of neo-liberalism favored the success of this choice for 15 years (from 1990 to 2005). The pursuit of this choice is questionable not only because of its political and social effects, but also because it is threatened by the implosion of neo-liberal globalized capitalism, which began in 2007. The Chinese government appears to be aware of this and very early began to attempt a correction by giving greater importance to the internal market and to development of western China.
To say, as one hears ad nauseam, that China’s success should be attributed to the abandonment of Maoism (whose ‘failure’ was obvious), the opening to the outside and the entry of foreign capital is quite simply idiotic.
The Maoist construction put in place the foundations without which the opening would not have achieved its well-known success. A comparison with India, which has not made a comparable revolution, demonstrates this. To say that China’s success is mainly (even ‘completely’) attributable to the initiatives of foreign capital is no less idiotic. It is not multinational capital that built the Chinese industrial system and achieved the objectives of urbanization and the construction of infrastructure. The success is 90 % attributable to the sovereign Chinese project. Certainly, the opening to foreign capital has fulfilled useful functions: it has increased the import of modern technologies. However, because of its partnership methods, China absorbed these technologies and has now mastered their development. There is nothing similar elsewhere, even in India or Brazil, a fortiori in Thailand, Malaysia, South Africa and other places.China’s integration into globalization has remained, moreover, partial and controlled (or at least controllable, if one wants to put it that way). China has remained outside of financial globalization. Its banking system is completely national and focused on the country’s internal credit market. Management of the yuan is still a matter for China’s sovereign decision making. The yuan is not subject to the vagaries of the flexible exchanges that financial globalization imposes. Beijing can say to Washington: ‘‘the yuan is our money and your problem’’, just like Washington said to the Europeans in 1971: ‘‘the dollar is our money and your problem’’. Moreover, China retains a large reserve for deployment in its public credit system. The public debt is negligible compared with the rates of indebtedness considered intolerable in the United States, Europe, Japan and many of the countries in the South. China can thus increase the expansion of its public expenditures without serious danger of inflation.
The attraction of foreign capital to China, from which it has benefitted, is not behind the success of its project.
On the contrary, it is the success of the projectthat has made investment in China attractive for Western transnationals. The countries of the South that opened their doors much wider than China and unconditionally accepted their submission to financial globalization have not become attractive to the same degree. Transnational capital is not attracted to China to pillage the natural resources of the country, nor, without any transfer of technology, to outsource and benefit from low wages for labor; nor to seize the benefits from training and integration of offshored units unrelated to nonexistent national productive systems, as in Morocco and Tunisia; nor even to carry out a financial raid and allow the imperialist banks to dispossess the national savings, as was the case in Mexico, Argentina and Southeast Asia. In China, by contrast, foreign investments can certainly benefit from low wages and make good profits, on condition that their plans fit into China’s and allow technology transfer. In sum, these are ‘normal’ profits, but more can be made if collusion with Chinese authorities permits!
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