Essay:A critique of Hoxhaist "anti-revisionism" on China

Socialism and commodity production?

Recently, inside ProleWiki there was a discussion about China on the Socialist market economy page. A comrade of ours, Wisconcom, was claiming China was a capitalist country, using several argumentative points and narratives. In this essay, I will explain why this comrade is absolutely wrong, and how his mistakes are specifically associated with a lack of grasping of Marxism and Marxist methodology.

He initially begins his argument claiming China is a capitalist country because, according to his words,

Market "Socialism" is at best, totally contradictory to the aims of creating the Communist mode of production. Communism requires the abolition of commodity production, and markets themselves are a means of commodity production, therefore, in order reach Communism, Market "Socialism" must not exist.

Furthermore, Market "Socialism" is itself an oxymoron. Markets, which commonly have private ownership of the means of production, constantly recreate bourgeois-exploitive relations. Hence, why Titoist Yugoslavia relied so much on IMF loans, and why it slowly became an economic puppet of the West, because, like Capitalism itself, Market "Socialism" logically ends with the consolidation in the hands of the few, and monopoly.

The term Market "Socialism" was created by crypto-capitalist revisionists and opportunists of the likes of Josip Tito and particularly Deng Xiaoping in order to enrich themselves at the expense of their people. Hence, why the "People's" Republic of China has over 75% of their economy in the hands of its capitalists (The PRC has the largest amont of billionaires in the world, much Socialism).

I suggest we apply a much more critical view to this right-deviationist anti-Marxist theory.

[all highlights are mine]

The first sentence already shows a lack of theoretical understanding of dialectical processes, because it treats "socialism" as an abstract definition, outside of time and space, not as a real, concrete movement. Hence why it is a metaphysical deviation on Wiscon's understanding of social and historical development. Let's analyze this sentence carefully:

Market "Socialism" is at best, totally contradictory to the aims of creating the Communist mode of production. Communism requires the abolition of commodity production, and markets themselves are a means of commodity production, therefore, in order reach Communism, Market "Socialism" must not exist.

He claims the use of markets is "totally contradictory" to the aims of "creating" the communist mode of production. First, the communist mode of production is not "created", it's not a set of characteristics that reality should adhere to, communism develops out of a capitalist country which reached the boiling point of its development under its relations of production, where it then becomes useless to produce things in that manner. Second, it's true that commodity production is in contradiction with production based on need, because one produces based on exchange-value, the other produces based on use-value. However, it's through commodity production that the productive forces develop, and achieve a production line capable to supplying people's needs.

About this subject, I will share these long excerpts by Marx in his The German ideology, as they are very very relevant to this issue:

In history up to the present it is certainly an empirical fact that separate individuals have, with the broadening of their activity into world-historical activity, become more and more enslaved under a power alien to them [...], a power which has become more and more enormous and, in the last instance, turns out to be the world market. But it is just as empirically established that, by the overthrow of the existing state of society by the communist revolution (of which more below) and the abolition of private property which is identical with it, this power, which so baffles the German theoreticians, will be dissolved; [...]

This “alienation” (to use a term which will be comprehensible to the philosophers) can, of course, only be abolished given two practical premises. For it to become an “intolerable” power, i.e. a power against which men make a revolution, it must necessarily have rendered the great mass of humanity “propertyless,” and produced, at the same time, the contradiction of an existing world of wealth and culture, both of which conditions presuppose a great increase in productive power, a high degree of its development. And, on the other hand, this development of productive forces [...] is an absolutely necessary practical premise because without it want is merely made general, and with destitution the struggle for necessities and all the old filthy business would necessarily be reproduced; and furthermore, because only with this universal development of productive forces is a universal intercourse between men established, which produces in all nations simultaneously the phenomenon of the “propertyless” mass (universal competition), makes each nation dependent on the revolutions of the others, and finally has put world-historical, empirically universal individuals in place of local ones. Without this,

1. communism could only exist as a local event;
2. the forces of intercourse themselves could not have developed as universal, hence intolerable powers: they would have remained home-bred conditions surrounded by superstition; and
3. each extension of intercourse would abolish local communism.

Empirically, communism is only possible as the act of the dominant peoples “all at once” and simultaneously, which presupposes the universal development of productive forces and the world intercourse bound up with communism. Moreover, the mass of propertyless workers – the utterly precarious position of labour – power on a mass scale cut off from capital or from even a limited satisfaction and, therefore, no longer merely temporarily deprived of work itself as a secure source of life – presupposes the world market through competition. The proletariat can thus only exist world-historically, just as communism, its activity, can only have a “world-historical” existence. World-historical existence of individuals means existence of individuals which is directly linked up with world history.

Communism is for us not a state of affairs which is to be established, an ideal to which reality [will] have to adjust itself. We call communism the real movement which abolishes the present state of things. The conditions of this movement result from the premises now in existence.

[all highlights are mine]

So that commodity production can be abolished, it needs to be developed to its highest point possible, and the productive forces of society should be advanced enough to satisfy people's needs so that the necessity for commodity production is abolished. This is the historical task of communists. Commodity production won't be abolished by government intervention and fighting "revisionism", rather by developing the productive forces to the point commodity production becomes production capable to fulfill needs:

We shall, of course, not take the trouble to enlighten our wise philosophers by explaining to them that the “liberation” of man is not advanced a single step by reducing philosophy, theology, substance and all the trash to “self-consciousness” and by liberating man from the domination of these phrases, which have never held him in thrall. Nor will we explain to them that it is only possible to achieve real liberation in the real world and by employing real means, that slavery cannot be abolished without the steam-engine and the mule and spinning-jenny, serfdom cannot be abolished without improved agriculture, and that, in general, people cannot be liberated as long as they are unable to obtain food and drink, housing and clothing in adequate quality and quantity. “Liberation” is an historical and not a mental act, and it is brought about by historical conditions, the development of industry, commerce, agriculture, the conditions of intercourse [...]

[all highlights are mine]

So, there is a contradiction between commodity production and production based on need, indeed. But socialism is precisely the period where this contradiction is developed so that the communist mode of production can rise. And this process can only happen internationally, because we live in a world-market, where almost all countries are dependent of one another. Socialism is therefore, the period of development of productive forces, and it's a contradictory process, because it's socialism developing out of capitalist production's contradictions. The same way a seed develops and becomes plant, there are moments where you cannot really tell if it's just a seed or just a plant, but both at the same time. Socialism is the in-between, the contradiction between capitalism and communism.

And you proceed:

Furthermore, Market "Socialism" is itself an oxymoron. Markets, which commonly have private ownership of the means of production, constantly recreate bourgeois-exploitive relations. Hence, why Titoist Yugoslavia relied so much on IMF loans, and why it slowly became an economic puppet of the West, because, like Capitalism itself, Market "Socialism" logically ends with the consolidation in the hands of the few, and monopoly.

If you claim "market socialism" is a contradictio in adjecto, then what is your "definition" of socialism? What countries are example of this purist and scholastic definition of socialism? If not a single socialist experience in history managed to abolish commodity production, then why would we describe socialism as having abolished commodity production? For instance, here's Stalin in his 1951 book Economic problems of socialism in the USSR addressing commodity production in socialism:

Commodity production must not be regarded as something sufficient unto itself, something independent of the surrounding economic conditions. Commodity production is older than capitalist production. It existed in slave-owning society, and served it, but did not lead to capitalism. It existed in feudal society and served it, yet, although it prepared some of the conditions for capitalist production, it did not lead to capitalism. Why then, one asks, cannot commodity production similarly serve our socialist society for a certain period without leading to capitalism, bearing in mind that in our country commodity production is not so boundless and all-embracing as it is under capitalist conditions, being confined within strict bounds thanks to such decisive economic conditions as social ownership of the means of production, the abolition of the system of wage labour, and the elimination of the system of exploitation?

Socialism is not a set of characteristics that reality should adapt to, socialism is the concrete, historical movement to advance the productive forces, led by the dictatorship of the proletariat. Socialism is not a set of pre-conceived dogmas that we should force reality to fit in, even if impossible.

Though socialism is not an a priori definition, we can distinguish a few features from current and past socialist countries, i.e., Cuba, Vietnam, China, People's Korea and Laos. They are all countries that were born out of a revolution that brought a communist party to the leadership of society. The ones that survive today never had a rupture with the core of that system.

There has been quite a number of historical Marxist regimes in Africa, Asia, Europe and Latin America, all trying to adopt their approach to revolution and development. No socialist state was grounded on the same material-historical conditions, and expectedly, they've developed their own political line and theory adapted to their conditions. But most of the socialist states that have existed in the past, when they fell, they didn't "reform" anything, they completely overthrew the proletarian dictatorship to give way to a bourgeois dictatorship. Take for instance, the counter-revolution in the USSR, where the Communist Party was removed from power, several state organs were dissolved, numerous state industries were privatized, and the "Duma" bourgeois parliament was restored. In each of the socialist states which fell, this happened.

The

The governance of China and development of productive forces

The People's Republic of China was born after a struggle against colonialism and imperialism, whose nascent bourgeoisie was oppressed by the British and Japanese empires, sometimes as much as a Chinese proletarian. But there was a sector of the bourgeoisie allied with the imperialists as well. The Communist Party of China allied tactically with particular sectors of the bourgeoisie, because they were those who felt disadvantaged by the imperialist occupation. Here's how Mao Zedong describes the class composition of China in 1926:

The landlord class and the comprador class. In economically backward and semi-colonial China the landlord class and the comprador class are wholly appendages of the international bourgeoisie, depending upon imperialism for their survival and growth. These classes represent the most backward and most reactionary relations of production in China and hinder the development of her productive forces. Their existence is utterly incompatible with the aims of the Chinese revolution. The big landlord and big comprador classes in particular always side with imperialism and constitute an extreme counterrevolutionary group. Their political representatives are the Étatistes and the right-wing of the Kuomintang.

The middle bourgeoisie. This class represents the capitalist relations of production in China in town and country. The middle bourgeoisie, by which is meant chiefly the national bourgeoisie, is inconsistent in its attitude towards the Chinese revolution: they feel the need for revolution and favor the revolutionary movement against imperialism and the warlords when they are smarting under the blows of foreign capital and the oppression of the warlords, but they become suspicious of the revolution when they sense that, with the militant participation of the proletariat at home and the active support of the international proletariat abroad, the revolution is threatening the hope of their class to attain the status of a big bourgeoisie. Politically, they stand for the establishment of a state under the rule of a single class, the national bourgeoisie. A self-styled true disciple of Tai Chi-tao wrote in the Chen Pao, Peking, "Raise your left fist to knock down the imperialists and your right to knock down the Communists." These words depict the dilemma and anxiety of this class. [...] The intermediate classes are bound to disintegrate quickly, some sections turning left to join the revolution, others turning right to join the counter-revolution; there is no room for them to remain "independent". Therefore the idea cherished by China's middle bourgeoisie of an "independent" revolution in which it would play the primary role is a mere illusion.

The petty bourgeoisie. Included in this category are the owner-peasants, the master handicraftsmen, the lower levels of the intellectuals — students, primary and secondary school teachers, lower government functionaries, office clerks, small lawyers — and the small traders. Both because of its size and class character, this class deserves very close attention. The owner-peasants and the master handicraftsmen are both engaged in small-scale production. Although all strata of this class have the same petty-bourgeois economic status, they fall into three different sections. The first section consists of those who have some surplus money or grain, that is, those who, by manual or mental labor, earn more each year than they consume for their own support. [...] Since they are quite close to the middle bourgeoisie in economic status, they have a lot of faith in its propaganda and are suspicious of the revolution. This section is a minority among the petty bourgeoisie and constitutes its right-wing. The second section consists of those who in the main are economically self-supporting. They are quite different from the people in the first section; they also want to get rich, but Marshal Chao [the God of wealth] never lets them. In recent years, moreover, suffering from the oppression and exploitation of the imperialists, the warlords, the feudal landlords and the big comprador-bourgeoisie, they have become aware that the world is no longer what it was. They feel they cannot earn enough to live on by just putting in as much work as before. To make both ends meet they have to work longer hours, get up earlier, leave off later, and be doubly careful at their work. They become rather abusive, denouncing the foreigners as "foreign devils", the warlords as "robber generals" and the local tyrants and evil gentry as "the heartless rich". As for the movement against the imperialists and the warlords, they merely doubt whether it can succeed (on the ground that the foreigners and the warlords seem so powerful), hesitate to join it and prefer to be neutral, but they never oppose the revolution. This section is very numerous, making up about one-half of the petty bourgeoisie.

[...]

Mao then presents the proletariat and introduces the semi-proletariat, a class particular to China's conditions at the time, and finally the lumpen-proletariat. In the end, Mao sums up the political line of the party based on that analysis:

To sum up, it can be seen that our enemies are all those in league with imperialism--the warlords, the bureaucrats, the comprador class, the big landlord class and the reactionary section of the intelligentsia attached to them. The leading force in our revolution is the industrial proletariat. Our closest friends are the entire semi-proletariat and petty bourgeoisie. As for the vacillating middle bourgeoisie, their right-wing may become our enemy and their left-wing may become our friend but we must be constantly on our guard and not let them create confusion within our ranks.

The Communist Party of China allied themselves with a few bourgeois members, because there was sectors of the Chinese bourgeoisie whose business was affected by the actions and policies of the imperialists. The party then established a contact with individual bourgeois elements which accepted the party's leadership against colonization and imperialism. In pre-revolutionary times, The communist party began to exercise power in several regions of the country and gradually developed the city economically through these alliances. In his book Red star over China, Edgar Snow describes the economic particularity of China in 1936:

It was imperative for [Chinese] Soviet economy to fulfill at least two elementary functions: to feed and equip the Red Army, and to bring immediate relief to the poor peasantry. Failing in either, the soviet base would soon collapse. To guarantee success at these tasks it was necessary for the Reds, even from the earliest days, to begin some kind of economic construction.

[Chinese] Soviet economy in the Northwest was a curious mixture of private capitalism, state capitalism, and primitive socialism. Private enterprise and industry were permitted and encouraged, and private transaction in the land and its products was allowed, with restrictions. At the same time the state owned and exploited enterprises such as oil wells, salt wells, and coal mines, and it traded in cattle, hides, salt, wool, cotton, paper, and other raw materials. But it did not establish a monopoly in these articles, and in all of them private enterprises could, and to some extent did, compete.

A third kind of economy was created by the establishment of cooperatives, in which the government and the masses participated as partners, competing not only with private capitalism, but also with state capitalism! But it was all conducted on a very small and primitive scale. Thus although the fundamental antagonisms in such an arrangement were obvious, and in an economically more highly developed area would have been ruinous, here in the Red regions they somehow supplemented each other

The main role of the Communist Party was overseeing the development of productive forces. It was the historical task of liberation that Karl Marx had spoken about. The main role of the communists is to make sure everyone is able to satisfy their needs and develop the productive forces of society to realize that. Officially, the Communist Party of China does not even call its country a socialist country, instead, they consider it a "moderately prosperous society" on its track to become a "modern socialist society" by 2049, when the People's Republic of China reach its 100th anniversary. This is a very sober estimation, considering that China is already very close to overcoming the US as the largest economy in the world, and in some respects it already has.

China is the country with the largest proletariat in the world, and it's the manufacturing powerhouse of the planet. It houses the most important industries in the world and constantly promotes development in undeveloped regions, such as Asia, Africa and Latin America. However, the country has developed a certain level of inequality as well. It has a very large prostitution problem in certain provinces. There are many regional inequalities, and a lot of people in poverty as well. Hundreds of thousands unemployed, along with an exhausting work schedule in some professions. A reasonable minimum wage of ~1500–2500RMB depending on the province one works, and very cheap food, clothing and public services.

It's certainly far from an idyllic place, but when you take into consideration where China came from, a population suffering extreme poverty in the 70's, and now an industrial powerhouse with a very large middle class, then you simply cannot attribute this to capitalism. To claim China is a capitalist country means you consider capitalism to be a progressive force for economical development. Because to lift yourself out of decades of colonialism and imperialist aggression and become the most powerful industrial powerhouse of the world is simply a feat capitalism cannot achieve. The only time a country rose out of a semi-feudal country to become an industrial superpower in decades was when the USSR came into existence, and a Third World country becoming an industrial powerhouse is simply unheard of except for the case of China. China has now abolished extreme poverty in its country, marking another outstanding achievement of the Chinese communists towards socialist construction.

China and transition towards socialism

In his article Has China turned to capitalism? — Reflections on the transition from capitalism to socialism, the Italian Marxist-Leninist historian and philosopher Domenico Losurdo, in short, argues that the Soviet Union realized several attempts and experiences at implementing a system which overcame capitalism. From 1917–1932, in the matter of 15 years, the Soviet Union evolved from war communism, then to New Economic Policy, and finally to the complete collectivization of the economy. The question then arises, why should we be surprised that different tactics and strategies are attempted in overcoming capitalism?

Since the times of Mao Zedong, the Chinese approach towards development was to promote the coexistence of different forms of ownership, but political power was concentrated by the proletarian state. This wasn't anything new, the same thing has happened during the time of the Soviet NEP. Consider these excerpts written by Lenin in 1918 and mentioned in The tax in kind:

State capitalism would be a step forward as compared with the present state of affairs in our Soviet Republic. If in approximately six months’ time state capitalism became established in our Republic, this would be a great success and a sure guarantee that within a year socialism will have gained a permanently firm hold and will have become invincible in this country.

I can imagine with what noble indignation some people will recoil from these words... What! The transition to state capitalism in the Soviet Socialist Republic would be a step forward?... Isn’t this the betrayal of socialism?

We must deal with this point in greater detail.

Firstly, we must examine the nature of the transition from capitalism to socialism that gives us the right and the grounds to call our country a Socialist Republic of Soviets.

Secondly, we must expose the error of those who fail to see the petty-bourgeois economic conditions and the petty-bourgeois element as the principal enemy of socialism in our country.

Thirdly, we must fully understand the economic implications of the distinction between the Soviet state and the bourgeois state.

[...]

But what does the word “transition” mean? Does it not mean, as applied to an economy, that the present system contains elements, particles, fragments of both capitalism and socialism? Everyone will admit that it does. [...]

Let us enumerate these elements:

1. patriarchal, i.e., to a considerable extent natural, peasant farming;
2. small commodity production (this includes the majority of those peasants who sell their grain);
3. private capitalism;
4. state capitalism;
5. socialism.

[...]

In the first place economically state capitalism is immeasurably superior to our present economic system.

In the second place there is nothing terrible in it for the Soviet power, for the Soviet state is a state in which the power of the workers and the poor is assured... [...]

Socialism is inconceivable without large-scale capitalist engineering based on the latest discoveries of modern science. It is inconceivable without planned state organization which keeps tens of millions of people to the strictest observance of a unified standard in production and distribution. We Marxists have always spoken of this, and it is not worth while wasting two seconds talking to people who do not understand even this (anarchists and a good half of the Left Socialist-Revolutionaries). [...]

At the same time socialism is inconceivable unless the proletariat is the ruler of the state. [...]

At present petty-bourgeois capitalism prevails in Russia, and it is one and the same road that leads from it to both large-scale state capitalism and to socialism, through one and the same intermediary station called “national accounting and control of production and distribution.” Those who fail to understand this are committing an unpardonable mistake in economics. Either they do not know the facts of life, do not see what actually exists and are unable to look the truth in the face, or they confine themselves to abstractly comparing “socialism” with “capitalism” and fail to study the concrete forms and stages of the transition that is taking place in our country. [sounds familiar?]

And in Role and functions of the trade unions under the New Economic Policy, written in early 1922, Lenin details the contradictions of the Soviet NEP, and why it was necessary:

The great bulk of the means of production in industry and the transport system remains in the hands of the proletarian state. This, together with the nationalization of the land, shows that the New Economic Policy does not change the nature of the workers’ state, although it does substantially alter the methods and forms of socialist development for it permits of economic rivalry between socialism, which is now being built, and capitalism, which is trying to revive by supplying the needs of the vast masses of the peasantry through the medium of the market.

Changes in the forms of socialist development are necessary because the Communist Party and the Soviet government are now adopting special methods to implement the general policy of transition from capitalism to socialism and in many respects are operating differently from the way they operated before: they are capturing a number of positions by a "new flanking movement", so to speak; they are retreating in order to make better preparations for a new offensive against capitalism. In particular, a free market and capitalism, both subject to state control, are now being permitted and are developing; on the other hand, the socialized state enterprises are being put on what is called a profit basis, i. e., they are being reorganized on commercial lines, which, in view of the general cultural backwardness and exhaustion of the country, will, to a greater or lesser degree, inevitably give rise to the impression among the masses that there is an antagonism of interest between the management of the different enterprises and the workers employed in them.

[...]

The proletarian state may, without changing its own nature, permit freedom to trade and the development of capitalism only within certain bounds, and only on the condition that the state regulates (supervises, controls, determines the forms and methods of, etc.) private trade and private capitalism. The success of such regulation will depend not only on the state authorities but also, and to a larger extent, on the degree of maturity of the proletariat and of the masses of the working people generally, on their cultural level, etc. But even if this regulation is completely successful, the antagonism of class interests between labour and capital will certainly remain. Consequently, one of the main tasks that will henceforth confront the trade unions is to protect in every way the class interests of the proletariat in its struggle against capital. This task should be openly put in the forefront, and the machinery of the trade unions must be reorganized, changed or supplemented accordingly (conflict commissions, strike funds, mutual aid funds, etc., should be formed, or rather, built up).

[...]

The transfer of state enterprises to the so-called profit basis is inevitably and inseparably connected with the New Economic Policy; in the near future this is bound to become the predominant, if not the sole, form of state enterprise. In actual fact, this means that with the free market now permitted and developing the state enterprises will to a large extent be put on a commercial basis. In view of the urgent need to increase the productivity of labour and make every state enterprise pay its way and show a profit, and in view of the inevitable rise of narrow departmental interests and excessive departmental zeal, this circumstance is bound; to create a certain conflict of interests in matters concerning labour conditions between the masses of workers and the directors and managers of the state enterprises, or the government departments in charge of them. Therefore, as regards the socialized enterprises, it is undoubtedly the duty of the trade unions to protect the interests of the working people, to facilitate as far as possible the improvement of their standard of living, and constantly to correct the blunders and excesses of business organizations resulting from bureaucratic distortions of the state apparatus.

[...]

As long as classes exist, the class struggle is inevitable. In the period of transition from capitalism to socialism the existence of classes is inevitable; and the Programme of the Russian Communist Party definitely states that we are taking only the first steps in the transition from capitalism to socialism. Hence, the Communist Party, the Soviet government and the trade unions must frankly admit the existence of an economic struggle and its inevitability until the electrification of industry and agriculture is completed—at least in the main—and until small production and the supremacy of the market are thereby cut off at the roots.

On the other hand, it is obvious that under capitalism the ultimate object of the strike struggle is to break up the state machine and to overthrow the given class state power. Under the transitional type of proletarian state such as ours, however, the ultimate object of every action taken by the working class can only be to fortify the proletarian state and the state power of the proletarian class by combating the bureaucratic distortions, mistakes and flaws in this state, and by curbing the class appetites of the capitalists who try to evade its control, etc. Hence, the Communist Party, the Soviet government and the trade unions must never forget and must never conceal from the workers and the mass of the working people that the strike struggle in a state where the proletariat holds political power can be explained and justified only by the bureaucratic distortions of the proletarian state and by all sorts of survivals of the old capitalist system in the government offices on the one hand, and by the political immaturity and cultural backwardness of the mass of the working people on the other.

[...]

Soviet Russia came from the background of a semi-feudal imperialist country ravaged by Civil War and intervention. It was an extremely delicate situation. The productive forces of the country were either destroyed or non-existent to give ground to socialist or communist relations of production. China, on the other hand, was in an even worse situation. The country was ravaged by Japanese imperialism, British imperialist wars, invasions, rampant drug addictions on opium, generalized famines and deaths of hunger, extreme poverty, countless deaths by preventable diseases, and so on. It was one the most impoverished places in the planet. Then, under the rule of the Communist Party of China, they promoted development, infrastructure, advancing the productive forces and in general giving the people better living conditions. It was almost a continuous development, only hampered by two events: the Great Leap Forward and the Cultural Revolution, which were two anomalies in the Chinese socialist development.