Lence Law, first published by Socialist Party Scotland (CWI)
The Chinese Communist Party (CCP)-dominated state is facing a narrowing of support in society. For decades, the leadership of CCP has relied on economic growth to maintain its legitimacy. However, this model is not as powerful as before. Social problems have been increasingly revealed and the cycle of capitalist crisis has been significantly accelerated.
Starting from the ‘reform and open’ policy in 1978, and completed in Jiang Zemin’s reforms in the late 1990s, the ruling class of the state, that had seen capitalism and landlordism abolished in the years following the 1949 Chinese revolution, has become a special form of capitalism controlled by CCP bureaucrats, which is not the same as western capitalist states, but there is no difference in the exploitation of the working class.
They hide behind a socialist-like narrative and use economic growth to cover the expanding gap between rich and poor. However, with the growing size and power of the Chinese working class, as a result of the rapid urbanisation of the past 30 years, social conflicts and a growing questioning of the Chinese ruling class’s character, make this recent social crisis more remarkable for the working class.
The beginning of 2024 sees the Chinese economy still in crisis, and the living quality of workers and young people is not getting better as the government promised. After the Chinese government cancelled its lockdown policy, under the pressure from the ‘white paper revolution’ protests, there was a short-term bounce back in the economy.
However, this wave of recovery was much shorter and smaller compared to the recovery in 2020. At that time, people were expecting to get back to ‘normal life’, and hoped that higher incomes in the future would cover their loans and bring them a better life. Yet two years later, both urban and rural areas face crisis and rising poverty.
Many young couples in China have given up having children as a result. Chinese society now faces the first population decrease since 1962. For the same reasons, under the impact of a worsening quality of life, young people are cutting back on spending, leading to a decrease in economic consumption.
The Chinese government has tried to stimulate the market, but people are less willing to spend their money. The economy is even facing a crisis of deflation, which leads to inefficient exports and investment.
Another crisis facing the Chinese economy is in the real estate industry. This was already happening before the pandemic, and has been accelerated with most of the population of China losing the ability to pay off debt.
During the past 30 years, the real estate industry has been bound to the growth of the economy and rapid urbanisation, and has been seen by the ruling class as a way to make financial investments rather than a place to live.
Under the illusion of rapid growth, the Chinese working class and youth have to clear out ‘six wallets’, which are two wallets of a couple and four wallets from each of their parents, to purchase a house and carry debt for 30 years. This industry has now reached its limit. Heavy debt has brought a negative impact to living quality, increased the gap between the rich and poor, and accelerated the decrease in internal consumption.
The extremely long working hours of Chinese workers is making things even worse. In 2023, the average number of working hours reached 48.7 hours a week. The economic crisis brings heavier pressure on the working class, which is the reason for low wages, long working hours and unemployment.
As of June 2023, youth unemployment was already over 20%, and overall unemployment also increased to 5.5%. Suppression of the workers makes people have no time and money on consumption.
The budgets of provincial governments within China are also facing a crisis. Local governments were relying on ‘land finance’, extremely dependent on the real estate and construction industries. Indebtedness of local and provincial governments has rocketed. Pressure on financial income makes local governments seeking a way to make cuts such as reducing expenses on medical care, decreasing the salary of civil servants and more.
Averting crisis
Against this backdrop, the CCP-led state is increasingly intervening to try and avert financial, economic and social crisis. Before the pandemic, the Chinese government, facing the overheated bubble of house prices, responded by pushing down house prices, represented by the slogan: ‘Housing for living, not for speculation’.
This reform includes policies such as introducing a property tax and restrictions on how many properties could be owned. The CCP hoped this reform could ease social conflict, and bring more investment to high-tech industry rather than the real estate industry, which already is in danger.
Under these social, economic and financial dilemmas, the bureaucratic capitalists and the state machine are losing the confidence of society. According to the Chinese Labor Bulletin, the incidents of workers’ struggle in 2023 numbered 1,779, compared to 831 in 2022. In 2018, before the pandemic, the incident count was 1,883. There has not yet been a qualitative change in the number of workers’ struggles.
On the other side, this still weak but growing working-class force has made the ruling class take action in the media and propaganda. The CCP not only uses nationalism and the narrative of ‘The Great Rejuvenation of the Chinese Nation’, but also tries to pander to growing left-wing public opinion.
The attitude of being ‘anti-capitalist’, the increasing reference to Marxist theory on official announcements, and, only on a few occasions, supporting workers during strike actions, has shown a recent shift by the ruling class.
This strategy is not only to try to ease the class conflict, but also to maintain its legitimacy, to claim itself as a ‘revolutionary party’. Until now, it still works. Many people seeking social reform are willing to believe the CCP can make society better. But on the other side, this action of trying to strengthen their legitimacy is a sign of weakness that will eventually undermine them.
Marxism
The bureaucratic capitalists’ claims to defend Marxism and revolution are ironic. It is the ideas of genuine Marxism which will eventually end their domination. The similar contradictions can be found all around modern Chinese society. One of the examples is at the end of 2023, more than 10,000 people rallied in Shaoshan, Hunan, calling for another revolution.
Similar events happened across the whole country, and over one million people took part online. These revolutionary left-wing protests are mainly influenced by Maoist ideas, but support for the idea of a new revolution for the Chinese working class is widespread.
The CCP could not ban the protests as they took place on the commemoration day of Mao Zedong’s birth, 26 December. The event in 2023 was the largest rally ever, and the proportion of young people has significantly increased.
Going forward, the Chinese working class and youth are fighting for independent worker-controlled unions, and the right of assembly. This will increasingly bring them into collision with the CCP and it’s ‘Marxist’ rhetoric.
With this growing awareness, support for collective ownership, democracy in the workplace, and genuine revolutionary Marxist ideas will eventually become the largest force among the working class. It is a long-term fight. The road is tortuous, and the future is bright.
