Xiaoming Guo 郭晓明
In the late 1980s and early 1990s, major changes took place in the world. The Cold War ended, and a superpower, the Soviet Union, disintegrated quietly. This is a mystery of the century. USSR did not even give a dying kick. A superpower abolished its power and quietly withdrew from the stage of history.
Academic circles classify the former Soviet Union, Eastern Europe, China, and India as transition economies, all transitioning from a planned economy to a market economy. This classification certainly misses a very important factor. If everyone transforms together, China’s foundation is the worst. Academic circles generally believe that China’s economy was on the verge of collapse before the reform and opening up. Therefore, if everyone transforms together, it should be that Russia’s development is better than China’s. China surpassed India because the transition was about ten years earlier, but the industrialization of the former Soviet Union and Eastern Europe had already been completed, and the industry in Eastern Europe was once China’s yearning. Think about it, China’s Liaoning aircraft carrier is still a half-built ship from Ukraine, which shows that the former Soviet Union and Eastern Europe industrialized much earlier than China.
Gorbachev visited China in 1989 during the Tiananmen Square Incident. Gorbachev witnessed the difficult time of China’s reform and opening up. After returning to China, he contributed to the disintegration of the Soviet Union, among the bombarding of western media on the Tiananmen Incident. Among all the economies in transition, China stands out from the crowd, and this is a basic fact. The difference between China and other transitional economies is that it still has the leadership of the Communist Party. Why does Western academia turn a blind eye to these two simple facts? Not only turn a blind eye, but also agree that the leadership of the Communist Party is incompatible with the market economy, that China has no future, that China will collapse soon, and that China is a pile of dry wood that can be ignited by a single spark, and the Chinese economy is Sitting on the crater, it may be wiped out at any time. From the last ten years of the last century to the first ten years of this century, the West taught China earnestly and set many examples of democracy for China. To ask China to give up the leadership of the Communist Party, the former Soviet Union, and Eastern Europe should be used as models for China. And then India, the world’s largest democracy should be an example for China. South Africa’s democracy is an example for China, the Arab Spring, and South Sudan’s referendum on independence have shown China the mighty trend of democracy in the world. After the drastic changes in the Soviet Union and Eastern Europe, there have been four wars within the former Soviet Union and Eastern Europe: the Kosovo War, the Georgian War, the Armenian War, and the Ukraine War. They are all transitional economies, the economy has not improved, and turmoil is still frequent. In fact, China’s transformation is not without theories. There are theories in Chinese academic circles, and that is the theory of socialism with Chinese characteristics. It is difficult for western theoretical circles to accept it.
There is a fundamental difference between China’s economic transformation and other countries’ economic transformation. China’s reform and opening up have undergone ten years of debate in Chinese theoretical circles. It has accepted the idea of compatibility between a market economy and socialism in China, actively transformed into a market economy, and actively opened up to join the world economy. The former Soviet Union, together with Eastern Europe and India, were infiltrated by Western academic thought, surrendered their ideology, accepted Western market economic thought, and transformed with an attitude of worshiping Western academic circles. China’s transformation is China’s own initiative, while other countries in transition are the result of the infiltration of Western ideology and culture. China’s economic transformation is the transformation initiated by the Communist Party of China and the evolution and development of the Marxist movement dominated by the Communist Party. Other countries in transition have abandoned Marxism and fully accepted the academic thought of capitalism. China does not reject Western ideas. China has imported a large number of Western economics textbooks and books. Those books were smuggled by the West into the former Soviet Union for ideological infiltration, and these books were translated into school textbooks in Chinese universities. But China does not abandon Marxism. Marxism is still a 101 course in universities. The former Soviet Union and Eastern Europe abandoned Marxism and embraced Western thought. It can be said that China is the most open-minded country in the world today, and it is in an era when a hundred flowers bloom in the ideological world and a hundred schools of thought contend.
The ideal socialism is distribution according to work, but socialism with Chinese characteristics fully absorbs the principles of the market economy and distributes according to factors. Three factors of production: capital, raw materials, and labor. Among them, capital gets profit, raw material gets rent, and labor gets a salary. For example, an oil-producing country has a good economy and a high income, relying on the differential land rent of oil resources. The U.S. economy is very good, relying on the rentier profits of Wall Street’s financial monopoly. China is a big manufacturing country, that relies on hard work. Distribution according to market factors, the factors that input into production, is the rule of the global capitalist market economy dominated by the West. The surplus value is divided into three parts. The surplus value generated in the global economy is distributed according to the factors. The West benefits, the Middle East gains rent, and China gains industrial profits. In strictly classical Marxist theory, China remains an exploited developing country in the South, injecting surplus value into the global economy. This is the reason why the theory of socialism with Chinese characteristics is not accepted by theorists of the international Marxist-Leninist movement. Socialism with Chinese characteristics is the result of the combination of Marxism and China’s concrete practice, and the result of the combination of Marxism and traditional Chinese culture. With the concept of Chinese culture and harmony as the most precious, and with the concept of Chinese culture and world harmony, China has no mentality of revenge for a century of humiliation, no mentality of robbing the rich and helping the poor who hate the rich, recognizes the fait accompli, looks forward to the future, and adopts an attitude of mutual respect, mutual benefit, and win-win cooperation, into the capitalist economic order dominated by the West.
This is how China’s reform and opening up developed. Knowing that it was the exploitation of capital mentioned in Marx’s classic theory, it actively introduced international capital and developed China’s economy. When the dividends of development can take into account the benefits of all stack holders, this is not exploitation, and this is an equivalent exchange in the market. Western white leftists who have been agitated by the soft power of the United States say that China’s investment in Africa along the Belt and Road is imperialist colonialism and capital exploitation, but this is how China was “exploited” and developed by introducing foreign capital. China respects other countries’ political system choices and does not interfere. China’s behaviors are completely different from the Western imperialist wars of aggression and occupation of colonies for hundreds of years. Equalling western imperialism and colonialism with China’s BRI is maliciously distorting historical facts. Surplus value is essentially the extra part of human production more than consumption. Surplus value is essential not only in a capitalist society but also in a communist society, which is the basis of human progress. Only if the use of living is less than the output of production, there can be wealth accumulation and human progress. The surplus value that Marx said is that under the exchange of equivalent value, the value created by the labor force is higher than the cost required for the reproduction of the labor force (necessary for a living). Exploitation is bullying, using the bargaining advantage brought by ownership of the means of production to drive down wages. Socialism with Chinese characteristics takes the road of common prosperity, and the surplus value is distributed according to the input of factors, which ensures the common improvement of people’s living standards and does not violate the Marxist theory. Marxist theory is a scientific theory of economics.
If the United States and China are both market economies, and the United States has more advanced technology than China, and the United States has more capital accumulation and control of world resources than China, then won’t China’s economy always lag behind the United States? According to the economic law of capitalist market competition, competition will spread technology and promote human progress, and the size of the economy is ultimately based on the size of the population. It is predicted that the ranking of economies in 2050 will be China, India, the United States, Indonesia, and Brazil. This ranking is roughly the same as the population ranking, except that the population of India has surpassed that of China. However, if the United States cannot tolerate China surpassing the United States, can the United States tolerate India also surpassing the United States? This kind of prediction is roughly based on the fact that the gap between China and the US 30 years ago is equivalent to the gap between India and the US today. Since China can surpass the United States in 30 years, India will also surpass the United States in 30 years. This is a prediction that puts the United States, China, and India under the same capitalist market economic system. If it took authoritarian China 30 years to surpass the US, should democratic India take less time to surpass the US? Say 10 years? Today, developed countries are both military alliances and industrial chain alliances, and their population is comparable to that of China or India. If the system is the same and the production model is the same, the US-EU alliance should always be stronger than China, and the population is not smaller than China. Europe and the United States can absorb more immigrants. China is facing an aging population, so Europe and the United States have an absolute advantage. The premise of this prediction is to equate China’s production model with that of Europe, America, and India. However, in light of our contemporary history of all transition economies, this premise is problematic. It cannot explain why China is rising. If the European and American alliance is always stronger than China, Europe, and the United States will not hesitate to suppress China, and put China in the “middle-income trap” forever. There is also the Matthew Effect in the market, the poor get poorer and the rich get richer. Then the North-South structure of the global economy will last forever.
Under the global market economy system, China’s export surplus means that the Chinese economy is more efficient, which means that the Chinese economy is a growing economy; the US’s export deficit means that the US economy is a less efficient economy, that is, the US economy is a shrinking economy. This is the result of capital seeking high returns. Where the return on investment is high, invest there. So why is the Chinese economy so efficient? “If you want to get rich, build roads first.” China’s infrastructure is good, and the overall transaction costs of the Chinese economy are lower than those of other countries. Britain was the first to use steam engine trains and railways, and Britain became the hegemony of the world that the sun never sets in the British Empire. The United States was the first to build a highway network, and the United States replaced Britain as the world hegemony. Today, China has built a high-speed railway network, and the intercity transit time is equivalent to the transit time of many metropolises in the world. Even if we classify China as a capitalist country and consider issues based on economic laws, we can also predict that China’s economy will surpass that of the United States.
Why did China build so many infrastructures on such a large scale? This is related to a fundamental premise, that is, China has a more advanced production mode, and China is a socialist economy. The capitalist production mode of the United States has lagged behind China. Therefore, the Chinese model represents the future of mankind. The socialist nature of the Chinese economy is reflected in the common prosperity, the goal of overall social well-being; the nature of the Western capitalist economy is reflected in the ratio of return on capital, reflected in the ratio of profit, with the goal of capital profitability. Therefore, many projects can be realized in China but are difficult in the United States. This is not about technical capability, but a production mode.
Take mobile phones as an example. Chinese can have a cell phone for a basic monthly fee of about $1 dollar with a daily data allowance. 100 RMB can last for a long time for a cellphone user because cellphone users can communicate by WeChat using only data and can use wifi. As long as you don’t make calls, there is no charge for answering calls, and there is daily basic traffic, which can be used for a long time. 100 RMB is converted into 20 Canadian dollars, 20 Canadian dollars is not enough for account setup and activation fees in Canada. If one adds an additional $20 CND to a sim card, the $20 will finish by this and that charge within two weeks before he or she hardly uses the cellphone. China’s mobile payment is the world leader, which is the huge social benefit generated by the popularization of communication infrastructure. While the social benefits are shared by the whole people, the mobile phone infrastructure is borne by several companies. These mobile phone companies are state-owned enterprises, and their goal is the economic benefits of the whole society, not the profits and investment returns of one or two companies. Without a communication infrastructure where beggars can bag money by swiping QR codes, there will be no possibility of the popularization of mobile payment. China’s mobile network cover even remote mountainous areas and Canadian mobile phones have no signal when they go out of metropolitan cities and highway belts, so mobile payment is difficult to realize.
The socialist government is the people’s government, and the people can trust it. Therefore, the use of health codes during the COVID pandemic is a scientifically respond. The Western government is not the government of the people, the people do not trust it, the health code is resisted, and everyone is afraid of government surveillance and tracking. This is a fundamental difference in the economic system. Without the people’s trust in the government, and the people’s trust in a certain company, not only will there be many obstacles in the construction of high-speed railways, but also the big data that is the foundation of Industry 4.0 will be difficult to collect and manage in justice and ethic. Western big data is collected by several large platform companies. Companies use big data for profit, which often harms the interests of consumers and is criticized by consumers. This is why Industry 4.0 will be realized first in China because China’s advanced production mode can adapt to advanced scientific and technological productivity.
China’s transformation is a transformation based on China’s adherence to the socialist foundation, basically maintaining socialist production relations. The capitalist production relationship is a money transaction relationship, and the relationship between people is a zero-sum game relationship. Any deviation from a fair transaction price means one party’s gain is the other’s loss. Factory management and trade unions have conflicts of interest. Workers’ initiatives are virtually completely excluded from the production process. The socialist production relationship is a social division of labor with equality and dignity. The management and workers are a relationship of common prosperity and a win-win cooperation relationship. There is mutual trust and the subjective initiative of workers can be fully exerted in production. In socialist production relations, the labor of workers is respected, the dignity of workers is protected, and the process of labor productivity is a wonderful part of life. In capitalist production relations, when the company makes a profit, it is the management team who gets the bonus. The workers have no incentive to increase their labor output. Good performance is attributed to the performance of smart management, not the hard work of workers. Therefore, under the capitalist system, work time is a burden, a kind of pain that cannot be considered part of living. There is only life after work hours. The meaning of life is the foundation of a happy life. Work hours in capitalist society are a burden to workers’ lives, not a life for workers to manifest their abilities. China’s overseas projects often encounter this situation. The progress is very fast when using Chinese labor. Once local labor is hired, especially labor with trade unions, the progress of the project will be greatly hindered. Because of language problems, local contractors must be used to hire local labor. The local contractor management and local labor have a conflict of interest. Production relations are prominently manifested in the management mode and labor relations. The relationship between labor and capital under the capitalist production mode is a relationship of conflict and opposition, while the relationship between labor and capital under the socialist production mode is a relationship of a division of labor and cooperation.
Socialism with Chinese characteristics is a production mode superior to the Western capitalist mode, and it can produce more and greater social benefits, including the physical and mental health of workers. Socialist cultural life is closely related to production. For example, the Chinese Spring Festival Gala often has performances praising migrant workers or delivery boys, and workers are respected by society. A determinant of whether life is happy is whether life is meaningful. When a teenager cannot see the meaning of life, he will have anxiety and depression, and he will abuse drugs. In capitalist developed countries such as Europe and the United States, the proportion of young people taking drugs is as high as one-third. In a socialist country like China, the number of young people taking drugs is less than one in a thousand. Depression and anxiety can also trigger headaches. The U.S. painkiller market is about 63.7 billion in 2020, while China’s painkiller market is about 6 billion in 2020. Of course, painkillers are not only for headaches but also for other diseases such as joint pain. However, the pains caused by other diseases should be similar in China and the United States. In terms of population, the painkillers needed for other diseases in China should be roughly four times that of the United States. Another indicator of happiness is life expectancy per capita. Although China’s GDP per capita is far lower than that of the United States, which is only about one-fifth of that of the United States, China’s life expectancy per capita has surpassed that of the United States. The capitalist system measures everything in terms of money, including the standard of living, in terms of consumption. The socialist economy is not for profit, but for the happiness of people’s lives. Material consumption is the necessary basis for a happy life, but not all. An equal and harmonious production relationship is an important part of a happy life. When labor is not respected, workers have no dignity, and no matter how much material consumption there is, there will be no sense of happiness. This is why there are many violent crimes in the United States, and violent crimes also require consumption. One has to have money to buy guns. Drug use is also a kind of consumption, so the legalization of marijuana in Canada can promote consumption and increase economic growth, but it will not improve the overall happiness level of society.
The future production mode of human beings must maintain a higher level of happiness with less resource consumption. With 5% of the world’s population, the United States consumes 30% of the world’s resources. Developed countries account for a quarter of the global population and consume three-quarters of the world’s resources. The capitalist system is not a sustainable economic mode. Socialism with Chinese characteristics can enable people to live a happier life with the minimum consumption of resources, and it is the future production mode of mankind. Only socialism can save China, and only socialism can save mankind.
In terms of human moral justice, the United Nations should support socialism with Chinese characteristics. In terms of economic competitiveness, the socialist mode with Chinese characteristics will inevitably enable China to develop faster and better than the West and be more harmonious with the international and ecological environment.
