It has become a cliche of Western punditry that China’s accession to the World Trade Organisation in 2001 should have gradually made it “more Western”; and therefore acceptable to “the international community”of wealthy countries and the classes that run them. This is usually cloaked in the language of “representative democracy”, but actually means that they believed that China’s economy would “liberalise”, allow the private sector to dominate domestically, and following from that, pro US business forces would press the CCP to allow a political framework that would facilitate the interventions from the State Department that are routine in virtually every other country; and thereby fit into a US dominated world internationally – on the game plan of the internal coup by sections of the Nomenklatura that overturned the Soviet Union. This was- and is – expressed in a touching faith that “free market capitalism” is the only way that an economy can be run efficiently; which is always true for those that own it, but not for the rest of us who just work in it.
This has not happened. Deng Xiao Peng’s comment – “I don’t care if a cat is black or white, so long as it catches mice” – was widely, possibly willfully, misinterpreted in the West as a vindication of market mechanisms and nothing but; paving the way for the rule of capital to be restored in the same way that it was in the former USSR; which among other things led to a decline in male life expectancy to 58 in Russia in the mid 1990s and collapses in living standards so severe that the per capita income in Ukraine today is still below the level it was in 1989. On the contrary, the way that China has incorporated market mechanisms within state direction is now causing conniptions in the US and UK precisely because China’s growth has exposed their own failings, especially since neo-liberalism ran out of steam in the 2008 crash. An event that brought it home even to the most pro US currents in China that all was not well in the “shining city on a hill” and that perhaps it didn’t present such an alluring model of the future after all.
What this means for people’s lives can be seen in the following figures.
In 2001, at the point China joined the WTO, life expectancy was 70.59. Per Capita income was $3,207 (in PPP terms*). The percentage of people living on less than $5.50 a day, the World Bank’s higher level of poverty measurement, was 80.6% and those on less than $2 a day – truly grinding poverty – was around 44%.
By 2008 – at the time of the Western credit crunch – life expectancy had risen to 75.14. Per capita income was at $7,577. The percentage of people living on less than $5.50 a day was down to 60.6%.
As the Western economies stagnated and held down by austerity, China reoriented investment away from exports to internal infrastructure – from high speed rail to renewable energy – and the net result was that by the end of 2019 per capita income had risen to $20,273; and by the end of 2020 life expectancy to 76.96, the percentage living on less than $5.50 a day down to 23.9% and those on less than $2 a day to 0%.
These figures – the reality of the staggering improvement in quality of life that they represent – and China’s apparent immunity to economic stagnation and austerity – are also a challenge to those sections of the left in the West who consider it to be just another capitalist country. The ruling class here are under no such delusion.
Listen to the smug and thoroughly insular discussions among the commentariat on Radio 4 and there is now a cosy consensus – with opinions stated complacently and neither challenged nor explored – that the time has come to “stand up to China” and “President Trump didn’t get it all wrong”. The critique now is that the CCP run economy is “authoritarian” and – as it runs on state directed investment – provides “unfair competition” to the West. In other words, it works better. It is more effective and efficient. In the Western view, they can provide cats in black or white, but they must be privately owned. If a state owned cat catches more mice, it has to be put down.
These discussions are taking place in societies still stricken by Coronavirus – as governments put commercial considerations ahead of health, leading to a catastrophe for both – and people in China look Westwards in horror at the mess the former “Global leadership” have made of it.
*Purchasing Power Parity. This compares what can be bought with a given sum – so a lower income in one country is balanced against lower prices and compared with the higher income and higher prices in another; so a more accurate comparison can be made. One dollar in China buys roughly what $1.50 would buy in the USA. In PPP terms, the Chinese economy is already larger than that of the USA. $24.16 trillion: $20.81 trillion. With four times the population, however, per capita income is still substantially lower.