Capitalism under the Red Banner: Seventy Years of the People's Republic of China

Seventy years ago, on 1 October 1949, the People's Republic of China was proclaimed by Mao. Here we reproduce an article which originally appeared in Communist Review 8 (January 1990), published by the ICT (or IBRP as it was then) in the aftermath of the suppression of the Tiananmen Square protests.

Submitted by Internationali… on October 7, 2019

Since those years, the economy of China has continued to grow, to the point where now the increasing rivalry between China and the US defines the imperialist framework of international capitalism. However, the 2007/8 financial crisis had its reverberations in China too, and has gradually undermined the dreams of endless growth. Throughout the last couple of years, the working class in the red empire has reared its head again ‒ the changing dynamics of class struggle in China are the subject of a piece we recently published in Revolutionary Perspectives 14 (Series 4).

From Mystifications to Massacres: Forty Years of the Chinese Peoples’ Republic

On October 1, 1949 the People's Army swept the Guomindang of Chiang Kai Shek from the Chinese mainland and set up the Chinese People's Republic. On June 3rd, 1989 the same republic led by the same "Communist" Party provided, in Tiananmen Square, an appropriate celebration of forty years of lies and oppression. When the "Great Helmsman", Mao Zedong, and the Chinese Communist Party announced that the Chinese revolution was part of the "world-wide proletarian-socialist revolution" they were only serving up the first course of a diet of mystification. The CPR was neither proletarian, nor socialist.

In fact the CPR was the result of a war of national liberation carried out by an inter-classist bloc (Mao's Bloc of Four Classes). This had emerged from the massacre of the revolutionary communist proletariat of Shanghai and Guangzhou [Canton] in 1927. Mao rose to prominence as the leader of the peasant faction of the CCP. His victory within the Party was the clearest evidence that there would be nothing proletarian about the Chinese October in 1949.

Nor did it contain anything socialist. Any system which is based on the wage labour relation, no matter what it CLAIMS to be, is capitalist. This China was after 1949. Even reconstructed Maoists recognise the difficulty of explaining the difference between China under Mao and China under Deng. There was no revolution between the two governments so the fundamental economic basis of the regime was not changed. The main difference was in rhetoric rather than in actions. Who, having repeatedly announced that "US imperialism is the most ferocious enemy of the world's people", invited its President, Nixon to Beijing in 1971?

By then the Chinese state capitalist regime's drive to accumulate autarkically had ground to a halt. Neither massive state centralisation of basic industries on the Stalinist model, nor homespun furnaces in every people's commune, had brought about a "Great Leap Forward". At the death of Mao the per capita output of the Chinese harvest was no better than the best years of Chiang Kai Shek's Guomindang rule in the 1930s. In short, despite its own specific problems China was discovering that it shared the same crisis of accumulation as its wealthier competitors in the West. The same crisis which has forced on the USSR Gorbachev's glasnost and perestroika also led to the massacre at Tiananmen Square.


When Deng Xiaoping emerged victorious from the power struggle that followed the death of Mao he was immediately adopted as the West's man. He would open up China for trade (called "democracy") after the "madness" of Maoism. The "Four Modernisations" launched in 1979 were in fact another programme to solve the capitalist crisis in China by adopting measures of privatisation and deregulation which were soon to became the orthodoxy in Thatcher's UK, Reagan's USA and Gorbachev's Russia. Deng's statement that "to get rich is glorious" made him a darling of the Western governments which fell over themselves to get deals with China.

For a time he could claim massive growth rates which reached 11 to 12% in 1988. However, despite this apparent restoration of the profitability of Chinese capitalism the crisis did not go away. Inflation was 35% and the Chinese external debt grew alarmingly. Most particularly the Chinese proletariat were beginning to reject a policy which gave cheap consumer goods to the rising bourgeoisie and petty bourgeoisie whilst rural and urban unemployment and the cost of basic necessities rose dramatically. There were over 100 reported strikes in 1988 in a country where the CCP heavily polices the working class in the factories and living areas.

It was this sign of unrest amongst the urban working class as well as the nationalist unrest in Tibet which led to the victory of the hardliner Li Peng over the so-called liberal Zhao Ziyang in the power struggle within the CCP in May. It was Li's policy of increasing the price of consumer goods which led to the students occupying Tiananmen Square. At first the students had few real demands, and certainly few which the regime found too "extreme". The tone of their movement was that of a petty bourgeois pressure group asking its own government to remain firm to the policy of promoting their privileges and opportunities for increased wealth. Only the intransigence and indecision of the CCP plus the intervention of the Western press turned the student's protest into a "democracy movement". And everyone in the West expected "their man" Deng to agree to some of the demands and to end the occupation peacefully.


Why did it not end this way? The instant "experts" from the West who frantically ran round Beijing trying to find Chinese who spoke English were the most surprised by the massacre. They could not understand why the liberalisation programme towards bourgeois democracy could not proceed. This was partly because they believed their own propaganda. According to the Western journalists the occupation of Tiananmen Square was a movement for democracy which swept the Chinese proletariat along with its demands. Although this contains a degree of truth it does not explain everything. In fact the Chinese proletariat were at first hesitant and played little part in the movement. As the demonstration carried on they began to support it by going to join the students and by holding strikes. At first these were of limited duration but gradually some began to take on more permanent character. All this the Chinese leadership could tolerate. However when the workers began to form their own organisations of struggle for their own demands (on living conditions) this was a different matter.

Just before 3 June we were faced with a typically inter-class social movement which was the response of the various strata of the population, for different reasons, to increasing hardship. The petty bourgeois and bourgeois stratas, initially hopeful about their prospects when the 1979 reform began, were soon disappointed and found themselves in an even weaker situation in comparison with the very rich few. This was what lay behind the students' denunciation of "illegal" enrichment based on corruption and their demand for a speeding up of reform, particularly more free trade and more democracy.

The proletariat, on the other hand, has been further impoverished by these reforms, facing wage squeezes and unemployment. Their increasing poverty at a time when the rich Red bourgeoisie were going in for Western luxuries pushed it onto the streets.

The strata of sub-proletarians (unemployed ex-peasants) who have moved to the cities have seized the opportunity to demonstrate their potential for rebellion. They have no particular interests to defend beyond expressing their anger and despair which means they could be utilised by any victorious class. This was too dangerous a framework for the regime which therefore decided on the massacre.

The working class became part of an already existing movement which led to a complicated phenomenon, too difficult for those who lack a firm grasp of Marxist method to understand. Thus even various elements of the proletarian vanguard couldn't see beyond what the bourgeoisie was saying. Every movement in society which springs from material causes tends to take on ideological and political overtones which do not always express the chief material grievances of the actors. What the Chinese working class did was to take up the slogans and demands of the movement which expressed immediate opposition to the regime which created their misery. Thus the workers in the USSR follow every bourgeois nationalist or workers in Jordan rioted against poor living conditions under the banner of Islamic fundamentalism. In short the absence of a revolutionary class reference point means that the struggles of the masses, even those of the working class, will, at least initially assume the political garb of whatever is available at that moment – mainly more or less radical petty (and not so petty!) bourgeois tendencies.

It is thus not by the ideological veneer a movement adopts that Marxists judge its real causes. If they did they would have to abstain from all intervention in them since all the really great workers movements in history have started from a more or less bourgeois terrain and faced the recuperative tactics of bourgeois "opposition" groups to divert them away from their own goals. Those communists who think that Tiananmen Square was just an internal matter for the bourgeoisie should ask why therefore the response was so savage. The Chinese CP and the Chinese state did not fear a few thousand students. It was only when the workers also began to move that the People's "Liberation" Army cracked down. It was not students but workers who were the first to be put on trial (in Shanghai) and shot in the aftermath of the massacre. We should not allow the bourgeois nature of the main movement in China to obscure the fact that there was also the beginnings of a proletarian response to the capitalist crisis. Failure to understand this leads only to abstractionism and abstentionism. This is not the role of the communist vanguard. Its task is to recognise the real material situation and to seek to develop the consciousness of the class by linking its immediate demands with its historic programme – the communist programme.


Today order reigns in Beijing. Today, despite the hypocritical tears for the crushing of "democracy" and the pseudo-embargos of the democratic leaders of the West, the Western companies who pulled out in June are slowly crawling back to Guangzhou, Shanghai etc. Whilst Deng has lost his golden halo in the West, the West does not intend to give up the profits it will make from this trade. Nor do the Western governments intend to miss the chance to hammer home the virtues of "democracy". They have not missed an opportunity to point out to the wage slaves of the West how lucky they are to live in the "free world". Tiananmen Square, the new government in Poland, the nationalities struggles in the USSR, even the fight against the Medellin drugs cartel are all about the struggle to extend "the idea of democracy". And an idea is all that it remains since it has no real substance. Whilst workers thought that by struggling for democracy last century they would create the conditions for the overthrow of capital we now know that democracy was only conceded once the ruling class had the institutional apparatus (Social Democratic and Labour parties which opposed revolution, total control of the media, etc.) in place to preserve their own dictatorship. It is no accident that democracy has its surest foundations where the rule of capital is strongest.

The proletariat of the entire world should draw an important lesson from the events in China. They cannot fight under the banners of bourgeois democracy or by using the petty bourgeois begging methods employed by the students of Tiananmen Square. Only a revolutionary class response can defeat the mystifications and repression of the world capitalist order. Such a struggle is not on the immediate agenda but every partial military defeat suffered in the initial struggles of the proletariat can lead to a step forward for the prospect of a successful revolution. But this in turn can only be achieved if their vanguard draws the political lessons necessary for strengthening their revolutionary organisation and giving it firm roots in the working class. But, however well prepared it is, no national section of the working class can win alone. As the gallant failure of the Russian working class shows the workers revolution has to be international or it will be nothing. The central task of revolutionary organisations in all countries is to regroup into an international party of the proletariat. Only such a centralised world party of the proletariat can give political leadership in the revolution against all the democratic and other ideologies which aim to preserve bourgeois rule including the so-called Communist and Labour Parties. Only such a party can ensure the victory of the revolutionary programme inside the working class. It is this perspective and to develop this process that the International Bureau for the Revolutionary Party exists. The bourgeoisie of both East and West have already celebrated too many anniversaries of their rule.

October 1, 1989