The following text is the English translation of an interview with Rémy Herrera, a research analyst at the National Center for Scientific Research (CNRS) at the Sorbonne in Paris. The interview was first published in the magazine Harici (Istanbul, Türkiye), and the newspaper Cumhuriyet (Istanbul) in May 2024. The original French has been translated by John Catalinotto for Workers World.
Herrera, who has co-authored a book by Long Zhiming called Dynamics of China’s Economy: Growth, Cycles and Crises from 1949 to the Present Day, makes several important points about the nature, history and trajectory of China’s socialist market economy. First, contrary to Western neoclassical economists who see China’s emergence as a function exclusively of its adoption of market mechanisms and its integration into the global capitalist economy, Herrera argues that “accelerated growth was made possible only by the efforts and achievements of the Maoist period.” When opening up was introduced, it was “firmly and continuously controlled by the Chinese authorities, and it is under this condition that it can be considered as having contributed to the country’s indisputable economic successes”.
China has engaged with the process of globalisation, but the crucial condition for the success of this experiment has been subjecting it “to the constraints of satisfying internal objectives and domestic needs, … fully integrated within a coherent development strategy”. Engaging with the global economy is not by itself a solution to all problems; after all, “for more than a century before the victory of the Revolution in October 1949, ‘opening up’ had meant above all submission, devastation, exploitation, humiliation, decadence and chaos for the Chinese people”.
Herrera also discusses the nature of China’s state-owned enterprises (SOEs). These “are not managed in the same way as Western transnational corporations”; their primary goal is not the pursuit of shareholder profit at all costs. Rather, they are duty bound “to stimulate the rest of the domestic economy, and go beyond a vision of immediate profitability when higher strategic, long-term or national interests so dictate”.
On the underlying socialist basis of China’s economic system, Herrera makes the fundamental point that, in China, “the state controls capitalism, not the other way around”. For example, China’s authorities have “successfully confronted the power of the financial markets”, building a “great monetary wall” to defend the national currency. “Powerful strategic planning, whose techniques have been relaxed, modernized and adapted to today’s requirements — which is what makes it so effective — is a distinctive feature of a socialist approach. State control of the currency and all the major banks is an absolute requirement, as is close monitoring of the activities of financial institutions and the behavior of foreign firms operating on national territory.”
He continues:
The coexistence of public and private activities, stimulated by each other within a mixed, hybrid system, is the means chosen to develop the country’s productive forces to the maximum − including by attracting foreign capital and importing advanced technologies − and thus raising its level of development, with the stated aim of improving the population’s living conditions, and doing this not by abandoning socialism, but by deepening the socialist transition process that began in 1949.
Herrera also addresses the ongoing crisis of neoliberalism and its manifestation in an increasingly aggressive New Cold War on China. “All the conditions are in place for the system’s contradictions to become even more pronounced, especially as few reforms have been carried out since the 2008 crisis”. All progressive and peace-loving forces must unite in opposition to the US and its allies’ escalations. “The defence of peace is the priority”.
Q: Let’s begin with your books on China. Based on your research and observations during your visits to China, how do you interpret the Chinese miracle that everyone is discussing?
RH: Many commentators on the very high rate of growth in China’s gross domestic product (GDP), which has been observed for several decades now, use the term “miracle” to describe this phenomenon. I, for one, believe that this is no miracle, but rather the result of a development strategy that has been patiently conceived and effectively implemented by the country’s leaders and senior officials in successive governments, under the authority of the Communist Party.
We read and hear everywhere, in academic circles and the mainstream media, that the “take-off” of the Chinese economy is due solely to its “openness” to globalization. In my view, it’s necessary to add that such accelerated growth was made possible only by the efforts and achievements of the Maoist period. This opening up was firmly and continuously controlled by the Chinese authorities, and it is under this condition that it can be considered as having contributed to the country’s indisputable economic successes. It is because it has been subject to the constraints of satisfying internal objectives and domestic needs, and fully integrated within a coherent development strategy, that this opening up to globalization has been able to produce such positive long-term effects for China.
Let’s be clear: without the elaboration of such a development strategy, which is clearly the work of the Chinese Communist Party — let’s not forget that — and without the energy deployed by the Chinese people to implement it during the revolutionary process, the country’s insertion into the capitalist world system would inevitably have led to the destructuring of the national economy, or even its destruction altogether, as is happening in so many other countries in the South, or in the East. One fundamental point must be borne in mind: for more than a century before the victory of the Revolution in October 1949, “opening up” had meant above all submission, devastation, exploitation, humiliation, decadence and chaos for the Chinese people.
Q: How does China’s success differ from Western development models?
RH: The success of the Chinese government’s development strategy and the many benefits it has brought to the country’s people contrast sharply with the failure of neoliberal economic policy measures applied in Western countries, which have had catastrophic consequences for workers in the North, whether in economic, social, or even moral and cultural terms.
Let me give you a specific example. One explanation for the strength of Chinese state-owned enterprises (SOEs) is that they are not managed in the same way as Western transnational corporations. The Western ones — listed on the stock exchange and oriented towards the logic of shareholder value which demands the maximization of dividends paid to their private owners, shareholder value and rapid returns on investment — operate by squeezing a chain of subcontractors, whether local or relocated abroad. Chinese state-owned groups don’t behave like this. If they were to behave in such a rapacious manner, they would be acting to the detriment of local small and medium-sized enterprises and, more broadly, of the entire national industrial fabric. But this is clearly not the case.
Most of China’s large state-owned enterprises are (or have become) profitable again because their guiding compass is not the enrichment of private shareholders, but the priority given to productive investment and customer service. In the final analysis, it doesn’t matter if their profits turn out to be lower than those of their Western competitors as long as they serve, at least in part, to stimulate the rest of the domestic economy, and go beyond a vision of immediate profitability when higher strategic, long-term or national interests so dictate.
Q: Can this model be defined in terms of the neo-classical or neo-Marxist model?
RH: First of all, I don’t think the Chinese see their development strategy as a “model.” Nor do they seek to impose or export it. They simply believe that certain lessons can be learned by the peoples of the world, but that it is up to them to define the objectives and means of their own development in their own specific historical, social and cultural conditions. This also differs markedly from the Western vision, which would like its “model” to be followed by every country in the world.
Neoclassical models have no application in China. If you’ll allow me, I’d like to add that neoclassical economics, which today constitutes the hegemonic or mainstream current in economics, basically serves no other purpose than to attempt to provide a theoretical and supposedly scientific justification for neoliberal political practices whose ideology is situated at the opposite end of the spectrum from measures for social justice and the development of public services. In reality, neoclassical economics is not a science, but science fiction or, as I put it in a recent book (“Confronting Mainstream Economics for Overcoming Capitalism,” Palgrave Macmillan), an ideology with scientific pretensions.
I am convinced, on the other hand, that Marxism has not yet been scientifically overtaken. Today, it has no serious competitor. It remains relevant, not least because we still live in a world where the capitalist system remains dominant on a global scale, even if its changes have been substantial, and need to be carefully accounted for. Despite the many attacks on Marxism since its foundation, and the repeated announcements of its death, it is enduring, resilient, “indestructible” dare I say, and the indispensable theoretical benchmark for anyone thinking about the ways and conditions of a better world.
Despite the demise of the USSR and the Soviet bloc, within which it had all too often become dogmatized and sometimes turned against itself, Marxism remains indispensable today, an irreplaceable point of reference for those fighting for socialism. So it’s hardly surprising that it is still an important theoretical reference for China.
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