Re: [OPE] Michael Webber

From: Dave Zachariah <davez@kth.se>
Date: Wed Jun 09 2010 - 17:14:51 EDT

Hi Michael,

Thanks for your informative reply.

On the question of capitalism or not, I'd say that we should not waste
time on classification for its own sake, 'butterfly-collecting' as Chris
Wickham once put it. Rather classification and conceptualization of the
Chinese economy should be motivated on historical-materialist grounds
that the specific way in which labour is organized and the surplus
product is extracted determines the dynamics of that society.

> the big questions about chinese capitalism then seem to me to revolve around
> (i) the nature of state corporations, and
> (ii) the involvement of the state in economic life.
>
> The status of state corporations needs to be clarified - ther is a lot
> of empirical work to be done on their operating conditions.

I agree with this, the role of the state apparatus in China still
appears obscure to me.

> I would
> claim that corporations are only capitalist or not in the world of
> theory. There is a long line that stretches from worker-owned
> companies with extensive social obligations that do not hire labour in
> a work place through to the purely capitalist corporations that
> Friedman extolled, whose only social obligation is to make profit.
> One step along that line are the state-owned corporations, with social
> obligations (to provide pensions, health care and education) and
> bureaucratic allocations of labour that characterised China before the
> reforms of SOEs started in the 1980s. Further along that line are
> corporatised SOEs. The shares in these companies are majority owned
> by the state; other shares trade on stock exchanges; they are forced
> to compete in a market, including the market for labour, and they have
> been stripped of their social obligations to provide pensions, health
> care and education. Their goals reflect the goals of their owners, up
> to a point; but their capacities and internal communities also direct
> where they seek to work and the manner in which they do so. The
> methods of these corporations the ways in which they raise finance,
> the manner in which they hire and employ labour, their orientation to
> making a profit are almost purely capitalist. Creating such
> corporations out of the arms of the various ministries and SOEs is
> undoubtedly shifting working conditions and corporation organisation
> towards capitalism, even if the corporations themselves can only be
> called (almost-) capitalist.
> In an informal discussion like this, i
> would say that i regard such corporations as essentially capitalist.
> certainly as far as labour is concerned...
>
> now the state. Time after time i see that the activities of
> individuals, private enterprises and the state are complexly
> intertwined, so that individual commercial decision taking is not
> separable from institutional supervision: in the Yangzi delta,
> southeast of Shanghai, some townships have absorbed much of the
> communal land, established a development corporation to lease that
> land to agricultural research enterprises and universities, and
> encouraged farmers to intensify their production of rice, fruit and
> milk, while at the same time prettifying their villages to attract
> tourists to stay in the homes of those same farmers; in countless
> villages across southern Inner Mongolia, the Autonomous Regional
> government and large (private) urban milk-processors are encouraging
> peasants to switch from traditional crops to intensive milk
> production. These developments all involve various arms of the state,
> private corporations and individual peasants in development projects,
> so tightly bound together that individual decision-taking is
> irrelevant. in this sense, the state - central, intermediate and
> local - is tightly bound up in organising, funding, directing,
> cooperating in development projects that bring together small
> businesses (often peasant), capitalists and the arms of the state.
> not always, but commonly. and they may or may not be successful.
>

But the question is whether state policy will try to accelerate or block
the inherent tendencies of capitalist firms to engulf the entire
non-capitalist market sector by the processes of capital accumulation.
That would be the basic test of the nature of the Chinese state.

For instance, some people on this list believe that it is moving towards
some form of 'socialism' although I find that argument unconvincing. In
many ways the economy seems to be following a classic capitalist
trajectory, including significant FDI flows outwards, albeit with a
higher state involvement than say Britain but perhaps not incomparable
to Japanese reconstruction.

> so, is this capitalism? well, who knows. does it involve capitalist
> production? yes, obviously. does it involve increasing shares of
> capitalist production? yes. does it involve forms of capitalist
> production that are different from private capitalist production of
> the kind that we are used to? yes. is it different from USSR-style
> state capitalism? yes to that too.
>
The state-owned sector in China would be a prime example of state
capitalism, but I think it is seriously misleading to say that the
Soviet-type economy was 'state capitalist', again on
historical-materialist grounds. I've made this point in a previous
discussion:

    http://ricardo.ecn.wfu.edu/~cottrell/ope/archive/0808/0105.html
    http://ricardo.ecn.wfu.edu/~cottrell/ope/archive/0809/0002.html

> may be this raises more questions than it answers. but it's too long already...
>
I think it was concise. Given the time constrains most of us face,
concise or at least brief but frequent posts are a lot easier to follow
and reply to.

//Dave Z
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Received on Wed Jun 9 17:18:30 2010

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