Below is a presentation given by a Consistent Democrats speaker at a Zoom forum on 4th May. The whole discussion is available as a podcast here.
In this period of neoliberalism, and the deindustrialisation of major imperialist powers, such as the US, or even not so major ones, like the UK, China has become known as the workshop of the world. A key part of the context of politics today, and the reason for the rise of such right-wing forces as Trumpism and Brexit with a working-class, or ex-working-class base, is this deindustrialisation. What has happened to the industrial jobs that used to provide the material base for strong working-class movements in the imperialist countries? They migrated overseas, to what appeared at first to be congenitally lower-income countries. China was possibly the classic case.
To understand how this became possible, we must look at the context of the Cold War since WWII. And in particular the Sino-Soviet split. In the early 1960s Mao’s China was perhaps more demonised than the USSR because of the ‘revolutionary’ rhetoric of its leadership. China was and is an enormous country, with the largest population of any in the world for most of that time, though it has recently been overtaken by India.
But the context in which the modern Chinese state was created was the Russian revolution, and then the bureaucratic degeneration of that revolution from the mid-1920s, when the bureaucracy by degrees took power away from the working class in a direct sense. The Chinese Communist Party originally was a classical Marxist organisation, led by an inexperienced but genuinely Leninist-Communist leadership around Chen Hu-Tsiu that based itself on the city proletariat in the great cities of China: Shanghai, Canton, Hong Kong, Wuhan for that matter.
However, the defeat of the Chinese revolution of 1925-7 happened in large measure because the CCP was instructed by the Comintern to carry out a long lived, unprincipled entry into the Kuomintang, the party of the national bourgeoisie. These were the instructions of the Stalin-Bukharin bloc in the Comintern, which was then dominant. It was a rightist position, based on political support for the national bourgeoisie as the agent of revolution – said to be in two stages – first the democratic revolution, led by the national bourgeoisie. Later there would be a socialist revolution. But the CCP had a mass working class base in those cities. The national bourgeoisie was far from keen on that – it was very afraid of it – and regarded it as more dangerous to its interests than imperialism or feudal warlords, etc. So, the Kuomintang conspired against the communists, notwithstanding the CCP’s policy. It aimed to crush that working class base, which the CCP politically disarmed. Chiang’s coup of April 1927, centred in Shanghai, smashed the communists and crushed the proletariat. There were similar purges by the Wuhan-based left wing of the Kuomintang in July. Then laid the basis for the Canton commune in December 1927, a bureaucratically-led workers uprising, an adventure, not prepared, not in tune with workers consciousness, and so a failure.
After these defeats of the CCP in 1925-7, the party left the cities, and sank roots into the peasantry instead, you had Mao’s long march, peasant-guerilla warfare, and as those forces began to take root, gave birth to a different type of party, based on peasant-based warfare, Maoist guerillaism. Trotsky raised the possibility that such peasant armies could come into conflict with the working class. This was a crucial issue much later, when the revolution was victorious, but it took forms that were difficult for anyone to anticipate at the time. The politics of the CCP were very much in the same mould as that of Stalin’s leadership of the USSR, which represented a conservative workers bureaucracy that had abandoned the goal of world revolution and sought ‘peaceful coexistence’ with imperialism to stave off dangers to the workers’ state.
The CCP based itself not on the proletariat in China’s cities, but on China’s enormous, impoverished and oppressed peasantry, and its struggle, initially aimed at national liberation and a bloc with the national bourgeoisie, with ‘socialism’ postponed until a later stage, was still a mighty struggle of the peasant masses. The bureaucratic regime in the CCP and its armies resembled Stalin’s regime in the USSR. On taking power, it was confronted with the reality that the national bourgeoisie preferred the support of imperialism, and such a multi-class regime was impossible. This was demonstrated particularly in the counterrevolutionary war imperialism waged in neighbouring Korea, where the imperialists at one point threatened China itself.
So, the Chinese Communist Party’s bureaucratic regime, for its own self-preservation, was driven to unleash a fully-fledged social revolution, establishing a deformed workers state with a bureaucratic regime similar in many ways to that in the USSR under Stalin and his successors. This social revolution made a huge leap in quality in relation to the evolution of production relations and for 40 years it struggled to develop the productive forces. In this period, it had to drain enormous resources from the peasantry to industrialise. It did not succeed. Until the 1980s China’s GDP was lower than Brazil’s.
It was only from the 1980s onwards that China began to be boosted by capitalist-imperialist investments. Because China’s break with the Soviet Union in the Cold War made the Chinese Communist Party appear relatively reliable for imperialism as an ally. So that it invested huge masses of capital to transplant the global production of commodities to China and make the country the “workshop of the world”. This was to take advantage of low labour costs for a literate working-class population. Objectively, this CCP policy was a pro-imperialist policy, and a treacherous one particularly in respect of imperialism’s war drive to destroy the USSR, which they did in time succeed in doing. However, it also had a paradoxical result, in that whereas the Soviet bloc was subjected to the massive economic shock treatment, that caused a massive economic decline in the USSR, whose driving force was a kind of Western-backed economic war against the recalcitrant bureaucracy in the USSR, China was basically left alone.
Indeed, imperialist investment and outsourcing provided it with material and productive resources, into a political and economic space within which the basic system of economic planning remained intact, notwithstanding Deng’s market ‘reforms’, which gave that basic structure the opportunity to massively upgrade its productive forces and material wealth at a time when the industrial capacity of imperialist countries were being outsourced and disposed of. This is a paradox. Deng’s market reforms did not go anywhere near as far as what Yelstin did in Russia, they did not dissolve the central state, and this is a decisive difference between them. Russia is not a workers’ state, though Putin has gone some way towards trying to reconstruct elements of the central state in Russia, he has only partially succeeded. That he was able to even do this, and that he was driven to do so at all, is an indication that the workers state, as a bearer and harbinger of a new and higher mode of production than capitalism, was not quite so easy to eliminate as the bourgeoisie hoped, and the Trotskyist movement feared. Even when the state ceased to exist, its higher production relations, even if they had been merely embryonic, were still able to deform its bourgeois successor.
A new bourgeois state was created in the former USSR as a result of 1991, the 1993 conflict over the parliament, Yeltsin’s tremendous and terrible economic shock, and Putin leading the retreat and re-armament of Russia to resist imperialist subjugation. But this did not and could not re-create the workers’ state. All it could do was massively modify the capitalism that came into being, fundamentally deforming it in that a mixed economy sui generis came into being. That is, one in which the statified element within it derives not merely from bourgeois nationalisation, but from elements of a higher mode of production – communism – that interpenetrates with it from the period where it was a workers’ state. But because in China the central state was never dissolved, we have a symmetrically opposite phenomenon – the capitalist elements are severe deformations on the still existing workers’ state.
We are not merely talking about the deformed workers state as it existed in the USSR under Stalin. Because after 1929, forced collectivisation put an end to NEP. NEP was an earlier policy of the Bolsheviks, that legalised to a limited degree, capitalist relations in the countryside in particular, in order to revive the economy of Soviet Russia after the civil war. In the lead-up to 1929, there was a conflict of the Trotskyists particularly with Bukharin over this. Bukharin, with Stalin’s support, had allowed NEP to go much further, and the NEPmen, capitalist traders, and particularly the wealthy peasants or Kulaks, had become much stronger. The Trotskyists warned of the danger of a revolt by these capitalist elements and advocated a planned industrialisation through taxation to reduce the weight of capitalist elements in the economy. They were denounced as ‘super-industrialisers’ by the Stalin-Bukharin bloc, as part of the campaign that defeated them.
But then there was a Kulak revolt against taxation, and against the Soviet state, which endangered the planned economy. The Stalin faction broke with Bukharin, and forcibly collectivised agriculture in response. The Trotskyists gave a degree of critical support to Stalin on this, because they viewed the Kulak revolt as an immediate threat of counterrevolution. Though they were harshly critical of the manner and some of the objectives of forced collectivisation, which was not based on any mass mobilisation. Remember though that the original motive of NEP was to use capitalism in a controlled manner to expand the productive forces. Remember also that the chief cause of the degeneration of the Russian revolution was the isolation of that revolution in a state with chronically underdeveloped productive forces. What appears to have happened in China is the result of a different situation. We now have a serious development of the productive forces in China. Deepseek is a prime example, but there is much more.
The development of China has kept the central state intact, in contradiction to what happened in the USSR. And imperialist investment, going hand in hand with the deindustrialisation of the West, gifted the Chinese state the opportunity to develop the productive forces in such a way. It’s as if what has happened in China is an extended version of NEP, which has created a situation where a workers’ state, with a large capitalist or NEPman sector to be sure, has developed the productive forces far beyond what was possible in the period of the degeneration of the USSR. It has even created a situation where parts of imperialism have become to a degree economically dependent on China, which for all its large layer of billionaire NEPmen, still at its core has a post capitalist state apparatus. It also has productive forces that in some spheres are more advanced than that of US imperialism. It is on the verge of having greater economic power than US imperialism also. For all its powerful NEPman/capitalist sector, the driving force that has propelled it to that position is not capitalism itself, but a capitalism supervised by economic planning at a basic level.
This in part is what was the idea of NEP. However, it is a paradox that the decline of capitalism in the early 21st century has meant that a power where a form of the dictatorship of the proletariat remained intact, has gained access to advanced productive forces comparable with the most advanced capitalism, in such a manner that appears self-sustaining. Such things as its Belt and Road initiative, which is about building infrastructure for global South countries, and thereby increasing its political influence by helping those countries traditionally victimised by imperialism find additional resources to resist. This is the cause of the Trumpian hysteria over China. This was not supposed to happen. This basically is why the US has allowed a regime of tariffs and economic nationalism to come to power. And yet it looks like it is going to fail.
Yet the CCP has nothing like an internationalist leadership. Its attitude to the foulest imperialist atrocity of our time, the Zionist genocide in Gaza, for instance, is purely a diplomatic opposition. A genuinely, communist leadership would have a very different approach, actively seeking to mobilise mass working class movements, and on top of that, resources, to aid the struggle against the genocide. The tepid policy of the Chinese workers state is massively different from that. Yet logically, the Chinese Communist Party ought to be open to a degree of debate over this. China has huge productive resources and is not in a state of fear of imminent collapse as Stalin’s USSR was in 1930s, when it treated criticism from its left as akin to pro-fascist opposition. An important danger to the workers state comes from the NEPman billionaire layer, whose role needs to be understood dialectically. In a sense, it is both the state planned core of the economy and the NEP that have combined to develop China economically and lift hundreds of millions out of poverty. Economic growth in China has not led to a massive growth in inequality as has neoliberalism in the West.
But at the same time, the NEPmen billionaires do potentially endanger that, as is shown in the West, ultimately profiteering classes do not take kindly to limits on their profiteering and will seek to remove obstacles to that. And while Chinese development has not led to the impoverishment of the masses, still the growth of such a billionaire class even though through state-supervised exploitation, is an affront to the aspirations of communism. Thus, there are minority trends in and around the CCP that look back to Mao for inspiration. But Mao was also an isolationist, nationalist figure, for all his radical rhetoric at times, whose influence also led to the alliance of China with the US against the USSR. Although that may have had paradoxical results, this was hardly the plan. It is still an affront to working class unity against imperialism. So, the CCP left, present and future, needs something better to crystallise around. Something that stands in the tradition of the Bolsheviks, of Lenin, Trotsky and Chen Hu-Tsiu, that sees the international working-class movement as its central focus programmatically. China needs to see a rebirth of workers democracy and genuine Soviet power.
The evolution of our position on Russia and China has been uneven, and we all have come from traditions of Western “Trotskyism” that have been to a degree flawed, and even tending towards centrism. In 2023 we modified our understanding of Russia, rejecting our previous position that counterrevolution had made Russia into a highly developed mere semi-colony. The initial position that we had, sort of inherited from trends within “Trotskyism” too much influenced by a strategic affinity to British Labourism, tended to see Russia and China as fundamentally similar, as ex-workers states morphed into semi-colonies. The merit of this is that we at least called for their defence against imperialism. However, its defect was that it could not really explain what drove the imperialist hostility to Russia and China that drove the new Cold War of the 20-teens, particularly regarding NATO expansion.
In 2023 we modified our understanding of both Russia and China, rejecting the notion that they were mere semi-colonies, in favour of the understanding that the power of these states, their ability to stand up to imperialism, derived from deformations on the post-Soviet forms of capitalism, derived from the weakness of the capitalism that had been restored given that their productive forces were created under the embryonic manifestations of a higher mode or production, communism. This explained a lot, but while it was correct about Russia, and the basis for principles and effective defencism, it was still unsatisfactory about China. Because while they are clearly closely allied, they are not the same. As elaborated above, the central state in China remained intact, and there was no neoliberal shock to break economic planning. So, we have been discussing and correcting our position for several months now, and this change is the result. We hope this will provide food for thought and discussion anyway.
