Sender: Topic: China: "socialist market economy"
Green Left Weekly
Posted on 2/09/2005 14:20

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*25.* Since the Fourteenth Congress of the Communist Party of China in
1992, the officially declared aim of the state authorities has been the
creation of a "socialist market economy", to be achieved through the
dismantling of the post-capitalist state-owned and nationally planned
economy that came into being as a result of the expropriation of
bourgeois property in industry, banking and commerce in the early 1950s.
This perspective was reaffirmed and deepened at the Fifteenth CPC
Congress, held in September 1997. In his unanimously approved report to
the congress, Chinese President Jiang Zemin declared that the CPC's aim
is the rapid privatising of the ownership of most medium-sized and all
small state-owned enterprises through "joint stock partnership or
sell-off", while converting some 512 major state-owned enterprises into
"highly competitive, large enterprise groups with transregional,
intertrade, cross-ownership and transnational operations".
>From the point of view of Marxism, the concept of a "socialist market
economy" is a theoretical absurdity. A socialist economy is an economy
in which the production and supply of goods is consciously regulated by
society to directly meet the needs of its members through the socially
planned allocation of productive resources. The precondition for this is
that means of production are collectively owned by the dominant social
body (the public power representing all members of society).
By contrast, a market economy exists in a society in which material
production is regulated in a socially unplanned manner through the
mechanism of generalised exchange according to the law of value (which
adapts the production and supply of goods to social demand
[WINDOWS-1252?]indirectly—that is, independently of society's conscious choices—through
successful and unsuccessful exchanges between autonomous producers).
Such an economy is a result of the fragmentation of social labour among
[WINDOWS-1252?]separate (private) owners of society's productive resources—whether this
is recognised in law or not.
Such fragmentation of social labour, of course, also characterised
socioeconomic formations in which petty commodity production prevailed,
that is, in which the direct producers (peasants, artisans) owned their
own means of production. But a market economy is one in which commodity
production is generalised, that is, in which the majority of direct
producers no longer own their means of production and are therefore
compelled to sell the only productive resource they have (their labour
power) to a private owner of means of production. A market economy is a
capitalist economy.

*26.* In the period since the Fourteenth CPC Congress in 1992 approved
the goal of creating a "socialist market economy", the share of
state-owned enterprises in gross industrial output has fallen from 53
per cent to 34 per cent. Most industrial, agricultural and commercial
activity is no longer directed by the central state authorities, and the
central planning system has been converted into a series of compromises
between the state banks and the state-owned industrial enterprises. More
and more state economic assets have been transferred into the hands of
joint stock companies owned by government officials. Even the army has
set up its own businesses, operating more than 400 factories producing
refrigerators, TV sets and passenger aircraft for the domestic and
overseas market.
The top officials in the central government have set their children up
in private and quasi-private businesses in mainland China and in Hong
Kong; vast numbers of lower ranking government officials in the coastal
provinces and those with family business connections in Hong Kong have
gone into private and quasi-private business ventures with Hong Kong,
Taiwanese and Western capitalist investors. The increasing business ties
that were established after 1989 between the ruling Chinese bureaucracy
and the big capitalists in Hong Kong provided the economic basis for the
latter's enthusiastic support for the integration of Hong Kong's fully
capitalist political and economic system into the state structures of
the People's Republic of China in 1997.

*27.* The turn by the ruling bureaucracy in China toward sanctioning the
transformation of the petty-bourgeois stratum that constitutes the
commanding personnel in the organs of state power into owners of
bourgeois property, like the somewhat earlier turn in the same direction
by the ruling bureaucracies in the Soviet Union and eastern Europe,
marks the final triumph of bourgeois reaction within the state
structures of these societies and the end of any activity on their part
to defend the nationalised, planned economy as a source of their power
and income. The state power these bureaucracies command has ceased to be
"a weapon of proletarian dictatorship". It has become an instrument for
the suppression of the resistance of the working class to the
reintroduction and defence of capitalist property relations. These
regimes are no longer highly deformed expressions of proletarian state
power. They are now/ capitalist states/.

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