Volume 4, No. 2, February 2003

 — Kamlesh

The new Chinese bourgeoisie is an intelligent breed. They learn, not only from the West but also from the revisionist experience of the erstwhile Soviet Union. Having witnessed the overnight crumbling of the vast Soviet Empire in 1989, due to an over-stretched bureaucratic, corrupt state capitalist system; they began disbanding the mammoth state enterprises, bringing in the private sector in a big way. Since 1997 they have been part and parcel of the globalisation process, just like any other country of the world. And with entry into the WTO over a year back, this process has taken a leap forward. Of course, like all revisionists, they continue to claim allegiance to Marxism and even Mao thought. They now peddle their bourgeois wares under such catch phrases as "socialism with Chinese characteristics", "socialist market economy", "Three Represents", etc. etc. The 16th Congress of the Communist Party of China continued in the policies outlined by Deng, and carried on, for the last 13 years, by his faithful disciple, Jiang Zemin. This Congress will particularly be noted for the fact that it decided to officially open the doors of the ‘communist’ party to entrepreneurs and capitalists.

Though capitalist restoration in China is so blatant, there are still some who promote the falsehood, claiming that China is socialist. In the international communist movement, as also in India, there are numerous fake communists, who either repeat, parrot-like, what the CPC says, or, unable to come out so crudely with their revisionist positions, pretend to take a wait and see position. In India the former are ruling class parties like the CPI & CPM, while the latter are those like the CPI (ML) Liberation. The CPI & CPM, in their party organs, have eulogized this Congress; while the Liberation at its recently held Congress finally agreed "not to jump to any hasty conclusions, with the need to keep a close watch on the Chinese experience and study it with an open mind".

The fact is that the CPC is a thorough-going revisionist party and China is a capitalist system. That China is Capitalist is well accepted by the entire bourgeois world, which does good business with it, but our revisionists do not wish to see this. The trouble with the revisionists is that they maintain the fig-leaf of socialism as long as it is possible to dupe their cadre and the people. They did that with the East European countries and Russia. In fact, just days before the overthrow of the Cheachescu ruling clique of Rumania in a mass upsurge, the CPM went out of its way to eulogise the ‘socialist’ experiment there, and its leader. It was only when the corrupt ‘communist parties’ were swept away, that the reality dawned on the CPM and other such revisionists. No doubt, as long as the mask of the communist party continues to exist in China, the revisionists of the world will continue to dupe the people.

But the reality is that capitalism ekes through every pore of the CPC and the Chinese system. It is there in the realm of its economy, it is there in its ideology, in its politics, in its culture — and particularly to be seen in the speedy growth of class differentiation and mass poverty within the people.

The Jiang Zemin report adopted by the 16th Congress of the CPC says, "The Congress …….. emphasizes that development is our Party’s top priority in governing and rejuvenating the country and that it is imperative to take economic development as the central task, keep releasing and developing the productive forces, improve the socialist market economy, implement the strategy of rejuvenating the country through science and education and that of sustainable development, promote strategic adjustment of the economic structure, basically accomplish industrialization, energetically apply it, accelerate modernization, maintain a sustained, rapid and sound development of the national economy and steadily uplift the people’s living standards". In India, Vajpayee repeats again and again that with an 8% growth rate, India will remove all poverty. So, Vajpayee and Jiang appear to have a similar approach, where economic development is linked to removal of poverty. It is also the approach of the CPM. In his Stray Thoughts On 16th CPC Congress (People’s Democracy, Dec 15, 2002), Harkishan Singh Surjeet, general secretary of the CPM, says "To develop a market economy under socialism is a great pioneering undertaking never tried before in history". He then goes on to praise every single decision of this Congress. A.B. Bardhan of the CPI, in his "A Brief on the 16th Congress of the Chinese Communist Party" goes on at length to justify the existing economic policies, supporting the theory of productive forces, and, as in India, supporting the mixed economy of a state sector combined with a private sector. Bardhan, negating principles presents the pragmatic argument, saying "What is clear is that the path of social development differs from one country to another in terms of the social system that exists at the present time and that which is to be created for the future".

But, what is the reality? For that let us take a brief look at China’s economy. Then, the readers can themselves decide whether it is socialist or capitalist.

Soon after Deng clique took power, through a coup after Mao’s death in 1976, the economic policies of the earlier period were reversed. The first generation economic reforms began in 1978, at the Third Plenum of the Eleventh Central Committee, giving a greater role to market forces and export-led growth. In agriculture, the collective farms were dismantled by leasing out land for private cultivation. The introduction of dual exchange rates and dual pricing systems helped in restoring the role of the market. Funding to various sectors of the economy was switched from government grants to those sectors that needed finance to create goods required by the people, to bank loans dependent on profitability and returns. In the 1980s the reforms introduced the "contract responsibility" system that allowed enterprises to sell their goods for profits in the open market, once they had fulfilled their quota. This was a cue for large quantities of state goods to leave the factory by the back door, with proceeds kept by the manager.

Deng pushed these policies, and his infamous statement "to be rich is glorious", was popularized. The 1980s witnessed the growth of fabulous wealth, somewhat along the lines as seen in India’s nationalized sector. Corruption, nepotism and ruthless milking of state enterprises became the norm.

This too was justified by Deng, with his oft repeated statement " once you open the windows, the flies come in". The best example of this was how the very PLA (People’s Liberation Army) was itself converted into a giant conglomerate. The PLA’s empire comprised some 20,000 companies. Since the early 1990s, when the PLA enhanced its commercial activities, corruption and nepotism increased enormously. PLA businesses were involved in almost every lucrative sector of the economy from transportation, to mining, real estate, telecommunications, and even the ownership of five star hotels. About 400 PLA pharmaceutical companies produced about 10% of China’s drugs, and the army’s factories made about 20% of the country’s cars and trucks and half its motorcycles. Besides, the PLA ran 1,500 hotels/motels and assorted entertainment joints. These companies had a total workforce of 5 million, 80% of which were involved in civil production.

The 1989 youth upsurge, culminating in the 2 lakh student occupation of Tiananmen Square for over a month, was basically against this nepotism and corruption which had penetrated every walk of life. Though the revolt had no communist content to it, it was directed against the misdeeds of the new revisionist rulers and so was ruthlessly crushed. On June 5, 1989, troops moved in (the occupation had begun from Apr.22) and pitched battles ensued, resulting in the death of hundreds of innocents and about 50 to 100 troops. There were thousands of injuries on both sides.

The 14th Congress of the CPC in 1992, held in the wake of this upsurge, tried to bring order to the reforms being pushed through at break-neck speed, and emphasised the re-assertion of planning and economic controls. Jiang Zemin was brought to top leadership by Deng in 1989 itself as a staunch reformer and ruthless administrator. While Deng moved to the background, till his death in 1997, it has been Zemin that has de facto ruled over China since the past 13 years. At this Congress, in Deng style, he too has moved to the background, replacing himself with his hatchet men to continue the reforms.

But, it was the 15th Congress in 1997 that radically pushed through the second-generation reforms, towards the wholesale dismantling of the state sector and the promotion of private enterprise. In 1997 the CPC endorsed the policy of the "shareholding system" that would allow small and medium state firms to be turned into companies with mixed public and private ownership. The process was speeded up by the absorption of Hong Kong, with its huge financial structures, into the Chinese system, in the very same year. In 1984 itself the CPC, in a Joint Declaration, pledged to preserve Hong Kong as it then was for 50 years after 1997. What the CPC termed as one-country-two-systems, was in fact one-country-one-system — i.e. a bourgeois system. In fact it is impossible for a government to promote capitalism in one of its parts and socialism in another, that too for 50 years.

The National People’s Congess in Nov.1999 wrote the "rule of law" into the charter, passed legislation to protect private business and property and relaxed foreign ownership restrictions. Shanghai was to fully open its private sector — and not just state enterprises — to foreign capital.

Such a blatant return to capitalism was justified by quoting Lenin’s New Economic Policy, implemented in the first years after the revolution (not after four decades). To further give a mask to this reversal Jiang Zemin promoted the theory that socialism in China was in its very primary stage and would continue to be so "for a very long time". Chinese officials openly stated that the private sector would from now on be "an important part of the market economy, consistent with Marxism-Leninism, Mao Ze Dong Thought". The Economist was more frank when in it’s Apr.8, 2000 issue it stated, "The 15th Congress, in the autumn of 1997, was a watershed. It marked the start of this new phase with the suggestion that tens of thousands of small and medium-sized state enterprises would be cast loose upon private waters, to float or sink. In the spring of 1999, guarantees that acknowledge the private sector for the first time were written into the Constitution."

Finally, yet another leap towards opening-up was taken over a year back when China finally entered the WTO. For all the CPC’s rhetoric against the Taiwanese regime, over the last two years major Taiwanese businesses have invested huge amounts in China, and Taiwanese executives head many foreign and collaborated firms in China. In fact the number of Taiwanese in China nearly doubled from 3 lakhs to 5 lakhs in the last two years. Companies like Acer, Compal, Hon Hai Precision Industries and Nanya Plastics have invested some $7.5 billion in just the Kunshan area of Jiangsu Province. What has been growing is a sort of Greater China economic colossus encompassing China, Taiwan and Hong Kong. This Greater China already has a GDP of $1.7 trillion, which is half that of Japan. If this figure is adjusted according to purchasing power parity (which accounts for differences in price levels) the figure is $7.8 trillion (compared to $9.3 trillion of the EU and $10.4 trillion of the US). First, there was the mass influx of manufacturers from Hong Kong to the Southern China coast; now it also from Taiwan. With China’s excessively cheap labour, businesses are flocking to that country also from Japan. Hong Kong is now, de facto, the financial capital of China, with China’s finances deeply integrated into Hong Kong’s international financial market and its Stock Exchange. Not only that, leading Hong Kong financiers are now advisors to Beijing’s policy makers.

So, today there is even little pretense of socialism. The bourgeoisie is everywhere, not only in the Party and state sector, where they continue with their socialist mask, but crudely in the private sector, which is sweeping the economy.

In pursuance of its line at the 15th Congress China signed a humiliating agreement with the US in 1999, in order to gain its acceptance to join the WTO. The market access commitments and other concessions extracted by the US from China as conditions for its WTO entry are mind-boggling. The average tariff level was to be brought to less than 10%. Agricultural tariffs, at 17%, would be half of what they are for India. For commodities like wheat it was almost zero. Quantitative Restrictions on imports and curbs on foreign investment, especially in telecom, financial sector and retail trade, would go. And all this had to be implemented by 2005. These are much more than the higher fee for late entry. They are far more savage compared to what other new entrants had to agree to.

Because of the concessions given in agriculture, imports of cotton, wool and soybeans would shoot up, 10 million peasants would lose their jobs and 18% of the land would be withdrawn from production. Total farm production loss would run into billions of dollars. Ofcourse, these concessions must be seen in the background of the decisions the CPC had already taken to pave the way to WTO entry. It had already decided to withdraw land from the production of traditional agricultural goods, it had begun importing 10 million to 20 million tones of foodgrains annually and there was a disguised rural unemployment of 200 million people.

In the manufacturing sector China agreed to reduce tariffs to an average of 9.4% overall and eliminate all qualitative restrictions by the year 2005. Reduction in the duty on auto imports was drastic, from 100% at the time of signing the agreement in 1999, to 25% in 2000 and 10% by 2006. In addition a basic level quota for auto imports was fixed at $6 billion, which would grow by 15% each year until quotas are eliminated in 2005. The auto sector would be hit hardest by these measures. But the CPC was prepared to let the small-scale auto manufacturing companies disappear, so that two or three conglomerates, particularly the joint venture enterprises with TNC auto giants, could compete in world markets.

In the service sector, the CPC agreed to phase out all geographic restrictions in telecommunications. They agreed to allow 49% share to foreign investors in telecommunication services; in insurance the CPC agreed to remove all geographic limitations for future licencing over 5 years and allow US entities access to key cities in 2-3 years. It also agreed to expand the scope of the activities of foreign insurers to include additional services. They were to be allowed 50% ownership of joint ventures (in India, till yet, only 26% is allowed). Reinsurance business was to be completely opened to foreign participation upon China’s accession to the WTO. For banking services, both geographical and customer restrictions would be withdrawn and full market access would be provided within five years. All this goes even beyond WTO stipulations.

But, it is in the "anti-dumping" and "safeguard" measures that China has made the most extraordinary concessions to the US. For 15 years after China’s accession, the US will use its current methodology for applying its anti-dumping measures against Chinese imports and China will not be able to invoke the legal criteria laid down in the relevant WTO Agreement to challenge this. Similarly, for 12 years, the US will be able to unilaterally apply restraint measures against Chinese imports, in case of a surge in these imports, without China being able to invoke the legal standards laid down in the WTO safeguards Agreement.

In its agreement with the EU, China has been barred from having recourse to several articles under the WTO Agreement on subsidies and countervailing duties.

With such agreements, what is there to distinguish it from other bourgeois systems of the world that are globalising their economies? Yet this is said to be "socialism with Chinese characteristics". What is specifically ‘Chinese’ about this; it has patently US characteristics. And the CPI(ML)Liberation would still have us wait and see and "not to jump to any hasty conclusions".

The fact of the matter is that the revisionist leadership of the CPC has quickly discarded state capitalism, after seeing the fate of the Soviet Union and East Europe. Earlier the CPI/CPM type revisionists could easily confuse the people throughout the world by equating state capitalism with socialism. Now even this fig-leaf does not exist. And to justify the wealth amassed by a few, Bardhan goes to the extent of repeating bourgeois propaganda saying that, "socialism does not mean distribution of poverty". True, but socialism also does not entail moving towards creating pockets of wealth amidst mass impoverisation. Maybe Bardhan and Surjeet see Deng’s mantra, to be rich is glorious, as the latest in socialist theory; and the Liberation is still contemplating its implication "with an open mind".

Having seen the character and direction of the Chinese economy, let us now turn to its disastrous impact on the lives of the people there, and the growing class divisions.

Will the real Bourgeoisie Please Stand up

Where is the bourgeoisie in China the CPI or CPM may ask? At best, they would argue, there may be some shortcomings in those ‘communists’, but surely CPC members cannot be termed capitalist. To argue otherwise, they would say, is yet another example of dogmatism — these dogmatists are utopians expecting pure socialism, instead of the practical market-oriented, globalised type!!!

The ABC of Marxism tells us that both the bourgeois system and the socialist system have certain fundamental laws. By delving into these one can understand whether the given society is basically bourgeois, or basically socialist. It may take any form; the question is on the content. So, for example, in China today, does the ‘law of value’ and the profit motive dominate the production process, or does production for the welfare of the masses predominate? This is the moot question to decide on the nature of that society.

In the period of transition to socialism the continuous restriction of bourgeois relations and bridging the gap between the rich and the poor is achieved by taking class struggle as the key link. Production, productivity and the development of the productive forces must be subordinate to it. Though it is true that in a backward country like China, there is utmost need to develop the productive forces, if this takes precedence over the class struggle, capitalism will be restored. And this is what Deng did with his theory of productive forces. Genuine socialism does not eulogise poverty, as Bardhan would have us believe; but it also does not allow some to get rich at the cost of the vast majority. So, in pre-1976 China there were no rich, and, as such, there were no real poor — the gap between the rich and the poor was constantly declining. No doubt, there was no abundance of wealth as exists today. But, after 1978, with the Deng/Jiang policies, we witness, on the one side, the growth of Chinese millionaires, on the other side the extreme poverty of a large section of the masses. A sizable middle-class (as in India) tends to hide these extremes.

In pre-1976 China the motive of production was the well-being of the masses — to provide them with, first, the necessities of life, and then gradually raise their mass standard of living. But, in post-1978 China, the motive of production has been profit — to extract surplus value from the labourer and appropriate it by the capitalist (whether state or private). In the earlier period any surplus generated in the process of production was given back to society in the form of re-investment in social production, according to plans set by the proletarian government/Party. Once this same govt./Party turned bourgeois (i.e. revisionist) the approach even in the state enterprises becomes geared to profit — not the welfare of the masses. So the high level of corruption and nepotism.

The high growth/production levels achieved by these new Chinese rulers, compared to earlier, do not prove the superiority of the existing system. These much-touted statistics, at best show an efficient capitalist system. Besides, the vast market that allowed for this rapid growth, was basically due to the sound purchasing power developed during the earlier three decades of socialist construction, and due to the extensive infrastructure built throughout the country (an example being the Tachai oilfields and the huge irrigation projects). It is for this reason that the per-capita consumption of commodities is far higher in China than in semi-feudal countries like India. During the socialist period, a maddening growth rate of production was not the main goal; meeting the welfare needs of the people was primary. In addition, the balance between the development of the productive forces and the relations of production had to be maintained. The Soviet experience shows that over-emphasis on developing the productive forces, with production relations lagging behind, generates capitalism. It was this balance that Mao sought to achieve through the Cultural Revolution. So, for example, in a factory, the relations between the workers on the one hand and the managerial staff (specifically the manager) on the other, has slowly to evolve into common control over the production process. If mere production is emphasised, neglecting to change the production relations between the manager and the workers, gradually the managerial staff will develop into a new bourgeoisie and the manager into the de facto owner, usurping the surplus value. So, though productivity was lower in the CR period, a re-alignment in the production relations would have led to its vast expansion. Unfortunately this was not to happen, due to the strongly entrenched bourgeois forces that, finally usurped state power immediately after the death of Mao. Under Deng production no doubt increased phenomenally; but so did capitalism. In the factory the manager became the new capitalist; at the all-China level the party bosses and the top bureaucrats became the new ruling bourgeoisie.

In China, the process of capitalist restoration and deepening class divisions, which began in 1978, took a big leap into the globalised economy since the 15th Congress. Ironically, the neo-liberal Deng, clamped down on the Democracy Wall that had come up during the Cultural Revolution, during the so-called dictatorial Communist regime. And Deng’s new Constitution also dispensed with the earlier Maoist inclusion of the "four big freedoms" to the people, including the right to strike work. Inspite of this, after the Tiananmen revolt, peasant and worker’s struggles (and even revolts) have been taking place on an ever-increasing scale throughout the past decade.

The worst hit have been China’s rural areas, after the disbanding of the communes and cooperatives. With the unleashing of capitalist forces in the rural areas, where 70% of the population live, there has been a polarisation of the classes and a gigantic displacement of labour, varying between 8 to 10 million a year. Floods have displaced another 14 million. It is estimated that today there are some 200 million (20 crore) of such people with no social security, land or jobs. It is said that at any one time some 80-130 million such migrants roam the cities in search of petty jobs. It is this huge mass of people who have been the most effected by the capitalist restoration, living a life in acute poverty.

More than any other class in China, rural migrants suffer the disdain of city dwellers and the arbitrary ‘justice’ of the authorities. These migrants are, de facto, second-class citizens, and lack all the privileges conferred on the urban resident by their ‘hukon’, or household registration. Without a hukon one cannot get access to schooling, health care or housing. So, for example, during the glittering functions of the 50th anniversary celebrations, 3 lakh migrants — beggars, prostitutes, drivers of 3-wheeled carts, children, mentally ill, etc. — were expelled from Beijing. Many were kept in ‘Welfare Centres’, more akin to detention camps. These are at the heart of the authorities "custody and repatriation" policies, which sanction arbitrary detention that bypass the judicial process.

Deng’s economic reforms proceeded at such speed, that by the early 1980s itself, China had a ‘surplus’ labour force of over 100 million in the countryside. Such a large reserve army of labour allowed China to develop capitalism, by developing ‘rural enterprises’. Without this ‘surplus’ labour China’s new ruling class would not have been able to extract the huge profits that enabled high rates of growth. It is these migrants that have provided the infamously cheap labour for China’s new private sector.

So, for example, in the Zhongshan and surrounding districts near Hong Kong, the paddy fields have been turned into factories where poor migrants from inland provinces flock to work. Most of them are young women, modern indentured workers, working at slave rates. Owners withhold six month’s salaries, which is forfeited if they leave before the year is out. Most of these girls work 12 hours a day, 7 days a week, without bonuses or overtime. In this Zhongshan region everything is privatized; even the few remaining ‘collectives’ and ‘township and village enterprises’ are throwing off their disguises, admitting to be privately run.

The reforms of Deng, since 1978, pushed, not only agriculture, but the entire country towards privatization. While in 1978 State-owned enterprises (SOEs) accounted for 77.6% of the GDP, by 1992 it accounted for only 48.1%. On the other hand, the share of the ‘collective enterprises’ (rural) rose to 38% and that of private enterprises to 14%.

By the early 1990s China’s capitalist state enterprises were hotbeds of nepotism, corruption and private accumulation. This supposedly was "socialism with Chinese characteristics". Inflation was running at over 20% per year. Peasant revolts were taking place in the west and other backward areas. The displaced working class was taking to the streets. Though the economy was growing at a fast rate, it was heading for a crisis. The example of the collapse of the earlier state capitalist economies of the Soviet Union and East Europe were glaring. The collapse of the S.E.Asian ‘Tigers’ and its impact on the Chinese economy was another warning. It was all these factors that led the CPC to push through the second-generation reforms at its 15th Congress in 1997.

Perhaps for the revisionist CPI/CPM these steps prove to them the creativity of the CPC leadership, as opposed to the thinking of the so-called orthodox Marxists. True. The steps suited the needs of a moribund state capitalist economy and the CPC were clever enough not to go the Soviet way. But, this is in no way linked to socialism. The CPC leaders proved creative capitalists and so they have postponed the demise of their own party for a few more years. The switch to whole-sale privatization and IMF–style economic policy, sustained growth temporarily, but at gigantic human cost.

By 1998 20 million public sector employees had already been laid off. On March 17, 1998, premier Zhu Zongji announced that the government would radically reform the state sector and the urban welfare system. The plan was to reduce loans to ‘inefficient’ SOEs, dismiss 30 million government employees over the next three years, raise funds by selling urban public housing and cutting medical welfare. Simultaneously 40 ministries were cut to 29, eliminating 17,000 senior civil-service jobs.

To take one example of a town like Liaoning. In 1995 it had an urban working-class of 12 million, with 3.3 lakh unemployed; by 1996 unemployment was 8 lakhs; and by 1998 it was 2.2 million or 18% of the work force. Since then, official figures state 4 lakh jobs are being lost every year.

While the old state sector enterprises paid good salaries, provided flats, sent children to company-run schools, looked after their health and paid their pensions; now the old situation has drastically changed. These benefits were all being systematically removed, with employees having to pay for everything and buy up their houses. Does this not sound very much like some World Bank prescription; but the CPI/CPM would also have us understand it is nothing but socialism with Chinese characteristics.

While millions are being thus impoverished the new rich can be seen in all the major urban centers, and not just Hong Kong. Beijing, for example has a number of luxury housing estates. So, flats at the Atlantic Place sell at one million Yuan (Rs.60 lakhs). This estate comes with parkland, lake, swimming pool, tennis courts and a clubhouse. Look, for example at the new township, Zhangjiang, across the river from Shanghai. It is the Silicon valley of China, with the top Taiwanese chip (computer) companies there, as also the leading US and Japenese companies. Shanghai is the headquarters of China’s nou-veauz rich with 5-star restreraunts, boutiques and bars. The Xintiandi area is being turned into a $3.5 billion complex of rich apartments and a 68-story building with a luxury hotel. Similar transformation is to be seen in Kunshan in Jiangsu province, and in all major cities like Chongquing, Shezhen, Dongqing, etc. Such vulgar affluence has also been spreading to the smaller towns like Qingdao and Tianjin on the Yellow Sea and Dalian. Hong Kong has been turned into the, de facto, Wall Street of China, with the Guangdong Province acting as its backwaters of thriving capitalism. Flocks of China’s new bourgeoisie can be seen intermingling with their counterparts from America, Japan and Taiwan in the nightclubs and restaurants in all these cities.

The new bourgeoisie is not hard to find in China. They flout their wealth. After all, to be rich is glorious!!! Deng, if alive, would be thrilled to see the product of his endeavours. Of course, the CPI/CPM turn a blind eye to all this, and the CPI(ML)Liberation is still studying the "new experience with an open mind".

In the Jan issue of this magazine we reported a massive rise in the struggle of the working class in China in the year 2002. In fact, this rising trend is to be seen throughout the 1990s. In the one year from 1992 to 1993 labour disputes rose by 54%. In 1995 there were 2 lakh disputes — a 73% increase over 1994. It reached a peak in the last two years, and continues to rise. An example of the militancy of these struggles was the upsurge of mine-workers of Liaoning in 2000. Thousands of workers, angry over the bankruptcy of their mine, burned police cars, etc., in a stand-off with the army that lasted several days.

Nine interior provinces and autonomous regions have remained appallingly poor. This poverty belt, stretching from Yunnan in the south to Xinjiang in the north, makes up half of China’s land mass and is home to 28.5 crore people. In the August of 2000, farmers in south Jiangxi staged a small but significant uprising against corrupt officials. They rose up against excessive local taxation in addition to the provincial and national taxes. They thrashed government officials and ransacked the houses of the wealthy in various towns. The Ughyurs of Xinjiang have been in a continuous state of revolt. They comprise 70 lakhs peoples in a population of 150 lakhs in Xinjiang province. Influenced by Islam, they have been demanding separation. Xinjiang has a border with eight countries and huge reserves of oil and natural gas. As with Tibet, the Chinese authorities have utilized Han chauvinism to dominate these minorities. Han Chinese now settled in Xinjiang, comprise 38% of the population of the province — 40 years ago only 15% of the population was Han.

So, we find in China a mass of population whose conditions are deteriorating in every way, notwithstanding the official statistics churned out by the administration and profusely quoted by the likes of Bardhan and Surjeet. These are, first and foremost, the 200 million displaced rural labour. They are also the millions being thrown out of state sector enterprises each year, already amounting to another 50 million — and continuously rising. Unofficial statistics puts China’s unemployment rate at 28% of the labour force. This huge 25 crore population of destitutes is a potential volcano, that can explode anytime and sweep away the CPC as happened in Russia and East Europe.

To diffuse the above eventuality the 16th Congress decided to incorporate private capitalists into the party. For, private capitalists, with their increasing clout and close links with the imperialists, could easily utilize the discontent of the masses to change the one-party system into a western style ‘democracy’ — which the imperialists have themselves been continuously demanding. With the private sector accounting for over 50% of the GDP, and comprising a sizable section of the new ruling classes, to keep them out of political power would have resulted in political instability. Though this meant the state capitalists, senior bureaucrats and top party bosses having to share some of their power with this new class of entrepreneurs, it in fact merely rubber-stamped an existing reality. In 2001 itself, at the time of the 80th anniversary of the CPC, a statement was issued by the party welcoming businessmen into its ranks. By then it was estimated that already 1,13,000 entrepreneurs had joined the party, whose firms contributed more than 20% of the country’s GDP.

But another most significant change introduced in this 16th Congress was in the sphere of ideology. Quite naturally the economic and political changes, reflected in privatization and absorption of entrepreneurs into the party respectively, must be accompanied by similar ideological changes. The so-called new ideological concept of the "Three Represents" was introduced at this 16th Congress linked to the personal glorification of Jiang Zemin.

It stated: "The Congress unanimously agrees to establish the important thought of Three Represents, Marxism-Leninism, Mao Zedong Thought and Deng Xiaoping Theory as the guiding ideology of the Party. As a continuation and development of Marxism-Leninism, Mao Zedong Thought and Deng Xiaoping Theory, the important thought of Three Represents reflects new requirements for the work of the Party and state arising from the changes in China and other parts of the world today. It is a powerful theoretical weapon for strengthening and improving Party building and promoting self-improvement and development of socialism in China. Persistent implementation of the "Three Represents" is the foundation for building our Party, the cornerstone for its governance and the source of its strength. The implementation of the important thought of Three Represents is, in essence, to keep pace with the times, maintain the Party’s progressiveness and exercise state power in the interest of the people."

The ‘Three R’s" of Jiang Zemin, refers to the CPC representing the development of the most advanced productive forces (a euphemism for the new entrepreneur), of having an orientation towards the most advanced culture (i.e. bourgeois culture) and of caring for the fundamental interests of the overwhelming majority of the people of China (i.e. necessary revisionist rhetoric). Jiang ensured that the Congress proceedings were carefully scripted to focus on his achievements in the 13 years since he became party chief. He spoke about quadrupling the GDP by 2020, when society could enjoy a fair measure of leisure and have a standard of life what France enjoys today. This is similar to the statements of the Indian leaders, who consistently talk of increasing the growth rate to make India a developed country in the future. For Jiang, as for Deng, development is the fundamental principle. This again is little different from the rhetoric of the World Bank type institutions, which is propagated day-and-night by the Indian rulers.

The essence of Jiang’s 3-Rs is to lay the ideological base for the acceptance of entrepreneurs into the party. Here he has cunningly replaced the criteria for membership from the standard "advanced class" to the "most advanced productive forces" and instead of "proletarian culture" he has replaced the term "most advanced culture". If these were to be taken as the criteria it is the US that has the most "advanced productive forces", so are they the best communists? And is their culture the most advanced or the most degenerate? Is this non-dogmatic Marxism as claimed by Bardhan and Surjeet, or is it bourgeois trickery, playing with words? In essence, Jiang has gone one step ahead of Deng’s theory of productive forces. While Deng only gave precedence to the development of the productive forces over the class struggle, Jiang has given precedence to the bourgeoisie over all other classes, including the proletariat, in the name of the "most advanced productive forces" and the "most advanced culture". This then is the essence of Jiang’s great thoughts!!!

This, ofcourse, is merely the culmination of the ideological degeneration that began in 1976 with the veiled attack on Mao and more particularly the cultural revolution; whose representatives were viciously targeted, as with the so-called ‘gang of four’. In the first phase of the ideological attack the attempt was to denigrate theory as such by the distorted and widespread propagation of the slogan "to seek truth from facts". Though facts or practice or reality may be the basis for coming to the truth, it itself is not the truth, as facts may be interpreted in numerous ways — particularly a proletarian way or a bourgeois way. So, deep knowledge, or real truth, comes from a scientific interpretation of facts, which is best achieved by seeing facts in the light of Marxist theory. If not, it is bound to be a bourgeois interpretation. Besides, in a class society, the utilization of facts cannot be above classes; the bourgeoisie will utilse the same facts in one way, while the proletariat will utilize it in another way. So, in essence, the wide propagation of this slogan in abstraction was a method used to negate Marxist (and Maoist) theory itself.

But, the revisionists, while thereby negating the importance of theory and the classics, put forward numerous distortions of theory, which could wave only be countered on the basis of a thorough knowledge of basic Marxist ideology. So, for example, in 1979, a ‘theory’ conference was convened in 1979 by HuYaobang (then head of the propaganda department), that launched a comprehensive political and philosophical tirade against the Maoist theory of capitalist restoration (which was the essence of the Cultural Revolution). Here policies linked to the Great Leap Forward and the Cultural Revolution were systematically attacked by some of China’s top intellectuals.

Then, in the 1980s a new concept was propagated justifying capitalist development on the basis that China was just in the "primary stage of socialism". Theorists like Su Shaozhi, Fang Lanrui and others began propagating various theories — like a distorted interpretation of Lenin’s NEP, the Yuogoslav experience and the theories of Mandel and the Polish economist, Wlodzierez Brus. Besides this, there was also a wide dissemination of critiques of ‘Stalinism’ from a supposed humanist point of view, and extensive propagation of the views of Althusser, Lukacs, the Frankfurt School, Agnes Huller, etc. and even those of Kant, Locke, Alvin Toffler and Milton Friedman. The purpose of all this was to basically negate the socialist models of Lenin, Stalin and Mao. Whatever may have been their deficiencies, it was only these that had successfully built socialism for a certain period; the point before the CPC would have been to discover the lacunae and build on it. But, in order to smuggle in their capitalist path of development, they had to throw out the very basic principles of socialism, by widely propagating all sorts of non-Marxist views, including that of the arch reactionary, Friedman.

In addition, at the philosophical plane Lenin’s theory of reflection (as outlined in Materialism and Empirio-Criticism) came under increasing attack, to be replaced by concepts of "practical materialism". Further Jin Guanto, the chief editor of the book-series, ‘Towards the Future’, argued that the developments in modern psychology and physics, the theory of relativity and quantum mechanics, had rendered Engel’s and Lenin’s epistemological (Theory of Knowledge) positions obsolete.

This entire intellectual debate laid the basis for speedy economic reforms through a negation of Marxist principles. All this coalesced into the line presented at the 1987 13th Congress of the CPC, which put forward the "primary stage of socialism" thesis (i.e. underdeveloped socialism) as the main theoretical justification for capitalist development. Senior theoreticians, like Yu Guangyuan, justified the adoption of capitalist policies on the grounds of China’s immaturity for socialism.

Such theoretical positions were also accompanied by a cultural onslaught, an example of which was the widely propagated TV serial River Elegy, aired in the summer of 1988. This focused on the backwardness of Chinese society and the need to replace it with institutions of the modern west. Similar ideas were reflected in the works of numerous artists and writers like Liu Zaifu, Liu Xiaobo and Gan Yang. These writers propagated that Chinese comm-unism was nothing but a continu-ation of Confucian despotism, with its repression of the individual.

All this gave the ideological content to the masses growing discontent against the corruption, nepotism and autocratic functioning of the new revisionist rulers, finally culminating in the Tienanmen outburst. After its suppression and the simultaneous fall of the revisionist regimes in the Soviet Union and East Europe, the CPC leaders sought to promote a new form of nationalism. This first came in the form of a document propagated in 1991 entitled, " Realistic Responses and Strategic Choices for China After the Soviet Upheaval". This cynically renounced the Marxist-Leninist legacy as a liability for the party after the collapse of communism in East Europe and the Soviet Union, and pointed to nationalism as a renewed rallying and cohesive force, within an ideological framework combining western rationalism with the "lofty and noble traditional culture of the Chinese people". With the growth alienation resulting from the rampant capitalism of the 1990s, coupled with the growing inequalities and lack of security in life, ‘New Confucianism’ was promoted in the search for ‘self’ and ‘cultural identity’. This turn to religiosity, seen also in the West, said that New Confucianism (in its third epoch) provides a happier balance between self and community than the liberalism of the west.

Such then have been the ideological and cultural trends either directly promoted by the CPC or allowed to grow spontaneously by turning a blind eye to it. Capitalist development itself breeds such ideas; while the growth of such ideas themselves reinforce capitalist development. As long as it did not disturb the political power structures, they were allowed to flourish. Such ideological trends have been promoted to serve the needs of the bourgeoisie at that time, which has now taken the form of the theory of the "Three Represents".

Much has been propagated about the smooth transition of leadership to a young team, with none of the old 7 stalwarts being in the CC. Yet, Jiang continues as the head of the Central Military Commission, and will be the patriarch (at 76), guiding things from behind. Power is now passed on to the 58-year old Hu Jintao Hu, who was picked for leadership ten years back by Deng and has the reputation of flattery and promoting Jiang ‘thought’, to stay in the good books of those that matter. Five of the seven other standing committee members of the politburo are Jiang’s men. The new Central Committee of 356 members, of which a huge 50% are new members, is packed with technocrats. Quite obviously the bourgeoisie is strongly entrenched in the communist party from top to bottom.

Mao, who is still revered by the Chinese people, cannot be easily discarded; so he has been turned into a national (Chinese) icon by the new rulers. The policies of Deng and Jiang are now put as though they are a continuation of Mao’s ‘non-dogmatic’ interpretations of Marxism. What is surprising is that the CPI and CPM also mouth this same interpretation, while, in the pre-1976 period, they had poured nothing but venom on all Mao’s writings. Why these theoretical acrobatics without any explanation? But there is a world of difference between Mao’s anti-dogmatism and that of the present bourgeois scum in China. Mao’s creativity was in his application and development of Marxism, and his gigantic contribution in adding to our knowledge of how to continue the revolution under the dictatorship of the proletariat. Deng/Jiang’s creativity is in revising Marxism, and in successfully taking China along the bourgeois path, avoiding the type of pitfalls (as yet) that hit the Soviet Union.

For a new revolution in China what is first of all required is to reject the false theories being dished out today and to uphold the essence of Maoism, and build on the great revolutionary traditions of Chinese history. The continuous outbreaks of worker’s and peasant struggles augurs well for the future if it is combined with revolutionary theory and the re-building of a genuine communist party based on Marxism-Leninism-Maoism.

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