this post was submitted on 14 Jan 2025
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chapotraphouse
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I've been thinking about this idea lately, since one of your previous comments on the topic.
I think it could make sense that China maintains it's current position as the means of production for the world, as exporting that role to the majority of available non-socialist countries would mean the greatest odds of handing it back to the control of foreign capital.
By China maintaining trade surplus and a strong control over global manufacturing as well as natural resource allocation, it can provide the strongest guarantee to itself that it can strike decisively and precisely when the moment is right.
When a new technological breakthrough is found which can catapult progress forward, China will be able to have it built in a few years because of the way their economy is currently functioning. Only China is in a position to, say, actually design and then make a scalable fusion reactor and build a dozen of them within a few years to then cut off the need for fossil fuels entirely. This is one of thousands of potential examples of technology that is being worked towards which, as soon as we find something that actually works, needs to be scaled up massively as quickly as possible, but you get my point. No one else is going to be able to actually figure these things out and then make them real on the scale necessary while also defending themselves from all sides by 5 eyes and improving the average citizen's life year after year. Being able to do these sorts of massively scaled, expensive, and innovative projects as quickly as possible is the only way to lower the coming death tolls from climate disasters and protect not only China but the world's future.
When disasters strike, as they will more and more, China will be able to not only help their people more effectively than everyone else, but we see in the case of COVID that they were able to keep their economy stable when all others were heavily impacted. Huge populations in China will need to likely be relocated during the next 40-80 years, which is a really short time that most of us will be alive to see. Their economy in it's current iteration and relationship with foreign capital supports this position, and as long as imperialists stay meddling, it seems wise to maintain course.
Then there is the BRI which needs a lot of money to essentially help accelerate the ability for the undeveloped world to develop, which will also further squeeze the foreign capitalists themselves. The only way for the investments into BRI to be most likely to pay off is to ensure that a lot of capital can flow to other countries with no guarantees aside from better deals on natural resources which mostly benefit you if you are a manufacturing hub. You need to be able to absorb billions in losses for when the US orchestrates a coup in the country you invested in and destroys what you've invested in. At the same time, China is maintaining a fantastic balance of livelihood growth, with more and more Chinese citizens being more and more satisfied while still maintaining the working conditions the undeveloped world.
It costs a lot for a nation like China just to have to engage in a world with the US, and I think the Chinese can see the US shuffling off to die in the cave and knows better than to prematurely turn it's back until it is clear that the predator can no longer strike. China is preparing for a shift that has not arrived yet, but is coming swiftly and I think China is consistently keeping up with being in the best position possible to leap forward at every opportunity without exposing itself to potentially fatal attacks.
I think your analysis of how China must shift it's economy in order to progress along the road to socialism is true, but it is not of the current moment and won't be until we firmly enter the new era. I think we will see this type of shift begin to happen in two or three generations, after the fall of imperialism at it's own hands, a world of disasters which no one is prepared for, and then the rebuilding of a socialist world from the ashes under the leadership of China. Assuming nothing catastrophic happens by then which drastically changes China's position as a communist nation, I don't think the CPC is on the wrong trajectory, even if it feels like things aren't happening fast enough most of the time.
The question is why would you need to accumulate so much trade surplus in order to achieve what you’re saying?
The surplus means money they cannot use. In fact, it means they have earned so much that they don’t know how to use them. That means Chinese workers are practically working for the West for free. The only party that truly benefits here is Western countries.
You do need some foreign reserves to maintain the stability of exchange rate if your currency is pegged to another currency (like RMB is soft-pegged to USD), but China has $3.3T reserves (!!) and they can easily slash 2 trillion of those and still be fine. China does not need more trade surplus lol, they are already accumulating so much foreign currencies that are just sitting there. They need to start raising the living standards of their workers by actually raising their wages. In fact, it makes their industries dependent on export and thus vulnerable to manipulations from Western countries that control the market.
Imagine telling your employer to pay you only 50% of your salary and switch the other 50% to bottle caps. You’re practically working your ass off for the company to collect bottle caps - collectibles that are practically worthless. The party that benefits here is the company who only have to pay half of your salary.
Imagine your employer can decide to nuke your house at any moment. That might incentivize you to accept a 50% bottle cap salary.
Cheap labor is how China has paid off the West and made itself indispensable to the market. It's unequal exchange.
lol this is why the West was genuinely afraid of Mao but not anymore since China has opened up.
Mao used to casually taunt the US to drop their atomic bombs on China and see who lasts longer. He would constantly talk about China engaging in a “10,000 years” long war (lol!) with the Western imperialists even until the end of the world.
These days the US just crosses red lines after red lines because they know that their opponents have no appetite to truly fight back and risk a nuclear war.
You aren't wrong, but on the other hand we haven't had a nuclear war either. That counts for something.
Although now we're zooming to a climate catastrophe that will make Earth just as uninhabitable so lol
The thing is they can keep crossing whatever red lines they want, it doesn't change the equation that it is the U.S. is fundamentally in a reactionary position to China's economy. While the financial and government elements think they have the tiger by the tail, whatever shenanigans they pull ultimately hurt the U.S. domestically far more.
When we, in American industry, lose access to Chinese inputs, we are the ones who are scrambling to fill those inputs, with suppliers that fundamentally don't exist (a.k.a. are three to four years out in manufacturing at volume, which is an eternity in business), but we still have to compete internationally with companies that do have access to Chinese inputs. Some people are conning a free lunch from China, but most people in this country are not. If anything they are in a tighter spot because China is the one paying for their lunch and if they do not, then they will starve, and everyone in manufacturing that knows anything knows that.
If the U.S. wants to compete with China at all, it will have to fundamentally change it's domestic industrial policies, and actually organize production to combat these inevitable shortages, something that it ideologically will not, and honestly at this point does not have the ability to do. Perhaps China does not want to press the 'socialism' button, but honestly, if I were them, I would wait for the U.S. to drive itself into a wall attempting to compete with something it fundamentally cannot. Let them be the ones to pull the trigger.
I think you're overfocusing on financial instruments relative to real production.
I strongly recommend David Graeber’s Debt: the First 5000 Years (which is based extensively on Michael Hudson’s research) to understand that all human economic activities dating back to the ancient Sumerian civilization are predicated on developing a financial system that works, because money (debt) allows for planning for the long term, without which human societies could not have advanced far into agrarian societies that require planning over seasons/years.
Real production is fundamentally tied to its financing. And how you decide to create money (debt) dictates the economic system itself. If your country has decided that you can only create new money from revenues of exporting goods to other countries, then your economic system will be strongly tied to export. There is no other way around it, because you’d never be able to develop the economy without keep selling more and more stuff to foreigners.
To put it another way, imagine if you constrain yourself to only be able to use one glass of water for every hour of work done, it would fundamentally shape how you live your life. You will alter your lifestyle around how much water you have to preserve every day, how much surplus water you have to keep in reserve (sometimes that means austerity - drink less every meal!), and how much work you have to do each day just to be able to quench your thirst or to wash yourself. What if you get laid off? Do I have to borrow from my friend who has stashed a bottle of water? How am I going to pay them back? What favors do I have to return?
Imagine having to live like that, and imagine (as I assume, like almost everyone, this is how you live) not having to worry about such constraints!