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Title: A new world order? Author: Shawn Hattingh Date: June 17, 2010 Language: en Topics: China, India, Imperialism, capitalism Source: Retrieved on 4th August 2021 from https://www.pambazuka.org/global-south/new-world-order
Countless books, with wonderful titles like ‘The Rise of the Elephant
and the Dragon’, have been written about the growth of the Chinese and
Indian economies. Many analysts and commentators from left perspectives
all the way to the right have also interpreted the growth of these
economies as a sign that a new world order is emerging. As part of this,
China and India have been touted as the new dominant powers in world
affairs of the next 50 years. In Africa, there has also been speculation
that this seemingly dramatic shift offers opportunities for African
countries to try and escape the grips of neoliberalism by aligning with
these emerging powers in opposition to the US. The various meetings and
summits involving states from the Global South, like China, India,
Brazil and even South Africa have added fuel to the analysts’ fire.
Indeed, we have been told that these meetings have been part of a global
power struggle that involves giant blocs, and powerful states within
them, positioning to pounce to take advantage of the weakness of their
rivals.
Certainly these arguments do have an appeal and are backed up by the
fact that the economic growth of India and China has indeed been
dramatic. For example, China’s share of total world exports has risen
from 1.8 per cent in 1990 to 9.1 per cent in 2008.[1] Now and then there
has also been rhetoric from the political elite in countries such as
China and Brazil about the need for a multi-polar world beyond US
hegemony. So on the surface a major power shift amongst states does seem
to be happening. Yet, if you begin to look beneath the surface, and
begin to look at aspects such as class interests, a much more
complicated and contradictory picture begins to emerge. What begins to
become apparent is that the interests of the elite in China, India,
Europe and the US are not always in opposition and, despite occasional
utterances, for the most part they are deeply intertwined. As part of
this, the elite in these states also often actively collaborate with one
another in their shared interests. This has seen these states implement
policies to maximise their profits by attacking what they really view as
their main foe: workers and the poor in China, India, the US and
worldwide.
Perhaps what analysts who focus solely on the global level and the power
play between states have often overlooked is that the massive growth of
the Indian and Chinese economies has been shaped by a local elite, in
collaboration with multinational companies, for the benefit of their
mutual interests. The political elite in both India and China have, over
the last three decades, used the state to reshape their economies toward
exports and attracting foreign investors to take advantage of the cheap
domestic labour.[2] This has led to a situation in China where foreign
capital from the US, Europe or Japan owns the majority of the assets in
21 out of 28 of China’s leading industrial sectors.[3] As a consequence,
the Chinese economy is to a large degree dominated by foreign capital
and it is foreign capital that has been the main driver behind the
economic expansion – with a Chinese elite acting the role of local
partner. In the case of India, its interests have been even more closely
aligned with the US elite than even those of China with American
interests.[4] Thus, the economic growth in China and India has not been
independent of – or in opposition to – transnational capital, but has
rather been driven by it, intertwined with it and in cooperation with
it.
In the case of China, its main role in global capitalism has in fact
largely revolved around being used as an ‘assembly plant’ by Japanese,
Taiwanese, and other East Asian multinationals. Companies like Dell
assemble all of their computers in China. Yet all the components are
designed in Taiwan, so even though the actual computers are assembled in
China there is far less transfer of knowledge than could be anticipated.
Thus, China to a large degree relies on technology from other Asian
countries such as Japan and Taiwan.[5] Many Asian multinationals use a
similar strategy as Dell whereby they export components to China from
their home bases, they assemble the product in China and then they
export it to countries like the US. This naturally has seen the US trade
deficit with China grow. What is often overlooked, and is an outcome of
China’s role as an ‘assembly plant’ for Asian-based multinationals, is
that the US trade deficit with the rest of East Asia has dramatically
shrunk.[6]
It has, however, not only been Japanese or Taiwanese corporations that
have taken advantage of China’s poorly paid workers. Some of the largest
US and European corporations have also shifted their manufacturing or
assembly concerns to China. For example, Wal-Mart outsources or produces
most of the goods it sells in the US in China. Others produce components
in their home countries and then export these to China to be assembled
before importing them back into home markets. In fact, 58 per cent of
China’s exports were produced by foreign-owned corporations in 2005, up
from a paltry 2 per cent in 1985.[7]
In the case of China, the move to link up with multinational capital and
attract foreign investors was directed by an elite in the Communist
Party – who have always used the party as a vehicle for self-advancement
ever since 1948.[8] Linking up with foreign capital, along with state
interests, has seen this Party-linked elite becoming immensely wealthy.
The authority that leaders within the Communist Party have has also been
used to place family and friends in high positions in both state-owned
and private companies. Many children of party officials who have been
put into key positions have used similar ties to acquire foreign
partners or even raise capital through the Hong Kong or New York Stock
Exchanges. Thus, far from confronting the elite in the US, Japan, or
Europe, the Chinese elite have actually sought them out as partners.
This, along with their total control of society through the Communist
Party, has made the Chinese elite incredibly wealthy, which means they
are probably loathe to undermine the relationships and partnerships they
have with elites in the traditional imperial powers. Indeed, more than
90 per cent of China’s wealthiest people have direct links to the
Communist Party[9]and through these connections they have access to
state-owned corporations, contracts and foreign investors. It is also
this concentration of wealth around Communist Party officials that has
led China to become one of the most unequal societies in the world. The
richest 0.4 per cent of the Chinese population control 70 per cent of
the country’s wealth.[10]
A similar tail of attracting foreign investors and partnering with them
has played out in India. Specifically, export processing zones (EPZs)
have been one of the main vehicles that have been used to attract
foreign capital and exporting multinationals to India. Even the
Communist Party of India-Marxist (CPI-M), which is often lauded by
leftists internationally for being progressive due to its role in the
Indian state Kerala, has promoted EPZs. In West Bengal, where CPI-M is
the majority party, it rolled out extensive plans to establish EPZs. As
part of this, party members attacked and even murdered activists that
were opposed to the establishment of an EPZ and the multinational
corporations that would come with it.[11]
The wealth of the Chinese and Indian elite, and that of their partner
multinationals that they allow to use their countries as a manufacturing
base, is built solely around exploiting the workers and the poor. It has
been calculated that this exploitation is so severe in China that the
average worker earns approximately USD$0.60 an hour. This has seen the
likes of Nike being allowed to pay its workers in China as little as
$1.75 a day, yet it retails its shoes back in the US for $150.[12]
Clearly, Nike and other multinationals of its ilk have and continue to
make huge profits from the exploitation of Chinese workers.
Chinese workers are not only subjected to low wages by local and
multinational corporations, but corporal punishment in factories is also
common. A good example of such practices can be found in the factories
of Foxconn. Foxconn is the company that produces iPods and iPhones for
Apple. It has frequently subjected its workers to corporal punishment.
This has not only included physical beatings but also forcing workers to
do push-ups as punishment.[13] Along with this, sexual assaults – mainly
of women workers – in local and foreign-owned corporations by bosses are
also common in factories in China. It has been reported that in 25 per
cent of Nike’s partner factories in China instances of physical abuse,
sexual abuse or psychological abuse have occurred regularly.[14] The
Chinese state simply allows this to happen and seldom, if ever, does it
punish the corporations involved.
As part of the gross exploitation of workers in China, the state has
also allowed local and foreign corporations to maintain extremely lax
health and safety standards. It has been calculated that as many as 200
million workers in China work under hazardous conditions.[15] In fact,
in the first half of 2003 alone it was reported by the China Labour
Bulletin that over 60,000 workers died in workplace accidents.[16]
Workers are also routinely poisoned by various toxins that are used in
manufacturing and assembling of iPods, cell phones and other hi-tech
equipment.[17] Again, none of the corporations involved have been
brought to book by the Chinese state and the Communist Party elite who
control it.
Indeed, the Chinese state plays the leading role in suppressing workers.
Strike action in China by workers is not protected by law. Workers who
demonstrate are routinely harassed and brutalised by the police.
Independent unionism is also harshly suppressed. Workers routinely face
lengthy prison sentences or confinement in ‘re-education camps’ for
resisting bosses and harsh working conditions or for trying to organise
independent unions.[18] Obviously, this harsh repression and outright
intimidation of workers benefits multinationals – indeed it is the main
reason why they are operating in China. The crushing of workers,
however, also benefits leading Communist Party officials who are
involved in lucrative business deals that are directly dependent on the
exploitation of workers. It is for this reason that they regularly
unleash state forces onto workers and the poor.
The suppression and exploitation of workers in China, especially over
the last 30 years, has led to growing inequality and poverty in the
country. In fact, the living conditions of workers and poor, far from
improving, have actually declined over recent years. In terms of the UN
Human Development Index, China ranks 92 in the world, on par with
impoverished Dominican Republic. Living standards in India, due to
exploitation, are even worse. It ranks a shocking 136 in the Human
Development Index, which is below even Cambodia and Laos.[19] It is this
that has led to workers and the poor both in India and China taking
direct action to challenge the system. Over recent years, China has
experienced the most strikes, protests and riots of any country in the
world;[20] while in India, due to guerilla activity and uprisings by
peasants, the state has lost control over at least 25 per cent of the
country’s landmass.[21] Both the Indian and Chinese states, therefore,
rightfully face massive internal opposition and possibly even very
uncertain futures.
The intertwined relationship that the elite in China and India have with
their US counterparts is not merely limited to their combined role in
exploiting workers. Both the Indian and Chinese states continue to
finance the US state’s ballooning debt. The reason why they do this is
because they need the American public to continu consuming the goods
being produced by their multinational partners and state-owned
corporations in China and India. The elite in China and India, for the
foreseeable future, will probably continue to do this because if they
stopped and the US economy collapsed and/or the US state defaulted on
its debt, the Chinese and Indian elite’s own economic and political
interests would also, in all likelihood, go down with it. Therefore, the
elite’s interests in China, Europe, India and the US – whether they even
like it or not – have become far more closely intertwined than in the
past, and they are now more mutually dependent on one another than ever
before. Far from actively seeking to undermine the US, the Chinese and
Indian elite have become their partners – even if at times with some
degree of bitterness – which is the logical outcome of the path they
have chosen in terms of their partnerships with transnational capital
and the direction they have set the economies in their countries on.
During the recent crisis, this situation has been even further
entrenched as both the US state and the Chinese state have spent
trillions – in terms of bailouts and stimulus packages — to keep this
status quo in place. Of course, the system whereby India and China
operate as a base to export to a finanicialised US has led to growing
inequality and poverty around the world. For workers in America, they
have seen many of their jobs ‘exported’ to China by mulitinationals. In
fact, partially because of this, workers in America earn less than they
did in real terms in the 1960s. Yet, workers in the US and elsewhere
like South Africa should not make the mistake of seeing workers in China
or India as the enemy. Jobs have moved because of the strategies of the
elite. In India and China, millions of people have been driven from the
rural areas to work in appalling conditions in factories so that the
rich and middle classes in the US and Europe can be provided with cheap
products. While the Indian, Chinese, European and US elite have got
filthy rich from this scheme, it has been the workers from all of these
regions that have suffered. In fact, there has been a massive shift of
wealth and power in the world, but it has not yet been from the US to
China: it has been from the workers across the world to the rich across
the world.
Therefore, it is perhaps more imperative than ever that the workers and
the poor across the world take a leaf out of the book of the elite, and
begin working together in their combined interests internationally. This
means resisting capitalism wherever it is, and the elite wherever they
are. In terms of Africa, this also means not having a forlorn hope that
the elite from China or India offer something better than the elite from
the US, but rather fighting imperialism from whichever quarter it comes
– be it from the US, Europe, India or China. As part of this, we also
need to perhaps link this to the fight for immediate gains – using
direct action – to immediately alleviate the worst effects of capitalism
and the way it has been structured internationally. This can also be
used to build the confidence of the workers and the poor. Exploitation
and oppression, whether in China, India, the US, or Africa, won’t go
away until capitalism and all states are gone. Perhaps the type of world
– or new world order – we should be fighting for is a world where there
are no bosses; where hierarchies of any form don’t exist; where
exploitation is gone; where workers manage themselves; where the economy
is democratically planned through assemblies and councils; where society
is democratically run from the bottom up using a system of assemblies
and recallable delegates; where all wealth is socialised; and where the
goal is to meet peoples’ needs and not to make profits.
[1] Hart-Landsberg, M. 2010. The US Economy and China: Capitalism, Class
and Crisis. Monthly Review Vol. 61 No. 9.
[2] Chomsky, N. Globalisation Marches On. 11^(th) October 2008.
[3] (missing footnote)
[4] (missing footnote)
[5] Hart-Landsberg, M. 2010. The US Economy and China: Capitalism, Class
and Crisis. Monthly ReviewVol. 61 No. 9.
[6] Chomsky, N. The Centre Cannot Hold: Rekindling the Radical
Imaginationwww.zcommunications.org/the-center-cannot-hold-rekindling-the-radical-im...
20^(th) April 2010.
[7] Whalley, J. & Xin, X. 2006. China’s FDI and non-FDI Economies and
the Sustainability of Future High Chinese Growth. National Bureau of
Economic Research, Working Paper Series No. 12249.
[8] Van der Walt, L. & Schmidt, M. 2007, Is China Africa’s New
Imperialist Power? Zabalaza: A Journal of Southern African Revolutionary
Anarchism No. 7.
[9] Kwong, P. The Chinese Face of Neo-liberalism. www.counterpunch.org
7^(th) October 2006.
[10] Zhong, W. China’s ‘Most Wanted’ Millionaires. www.atimes.com
19^(th) September 2007.
[11] Roy, A. Brave New India.
www.thirdworldtraveler.com/Boycotts/NikeThird_facts.html 9^(th) June
2010.
[12] (missing footnote)
[13] www.corpwatch.org 14^(th) February 2007.
[14] www.educatingforjustice.org/stopnikesweatshops.htm 9^(th) June
2010.
[15] Hart-Landsberg, M. China, Capital Accumulation and the World
Crisis. 25^(th) July 2003
[16] (missing footnote)
[17] 9^(th) June 2010.
[18] (missing footnote)
[19] Chomsky, N. Globalisation Marches On. 11^(th) October 2008.