75 years ago, on October 1, 1949, the Communist Party took power in China, ending a long civil war, and its leader, Mao Zedong, announced the birth of a new nation: the People’s Republic of China (PRC). ).
The country went through enormous changes. Mao installed Marxist policies, but unlike Soviet communism, which centered on the working class, the Maoist revolution was based on the peasants.
Mao’s goal was to industrialize the country and transform China’s traditional agrarian economy. To do this, he created work brigades and collective farms, prohibiting agriculture and private property.
The collectivization and centralization of the economy transformed Chinese society.
But “The Great Leap Forward” -as Mao called his industrialization process– also caused a very serious food insufficiency and at least 20 and up to 45 million people, according to different sources, died of hunger between 1958 and 1962.
Mao deepened his communist policies and launched another of his most controversial policies in the mid-1960s: the “Cultural Revolution”, a campaign against the supporters of capitalism in China under the pretext – historians highlight – of eliminating his enemies. politicians within the Chinese Communist Party (CCP).
Millions of people were terrorized by the Red Guard, the young people mobilized by Mao to eliminate “bourgeois culture.”
Despite this, an intense personality cult turned Mao into a kind of national divinity.
His image is still very present in the daily life of the Asian country. However, today the People’s Republic of China couldn’t be more different of what “The Great Helmsman” conceived.
Superpower
75 years after its founding, today’s China seems almost opposite to the nation conceived by the founders of the CCP.
While Mao collectivized work, centralized the economy and persecuted the supporters of capitalism, today China is the second largest country in the world with more millionaires (There are more than 6 million, according to the latest UBS Global Wealth Report.)
Your Gross Domestic Product (GDP) It is only surpassed by that of the United Stateswhich has just 6 more companies than the Asian giant (139 vs 133) on the list of the 500 largest corporations in the world, according to Fortune magazine’s 2024 list
It also has the wealthiest banking sector and the entity with the largest assets: the Industrial and Commercial Bank of China (ICBC).
How do you explain, then, that the largest communist country in the world has this level of wealth and is on its way – according to some analysts – to becoming the main economic superpower on the planet?
It’s all due to the changes introduced in 1978 – two years after Mao’s death. Deng Xiaopingwho promoted an economic program that became known as “Reform and opening“.
Deng did the complete opposite of what Mao preached: he liberalized the economy, allowing the resurgence of the private sector and decentralized power, leaving decision-making in the hands of local authorities.
He progressively dismantled the communes and began to give greater freedom to the peasants so that they could manage the lands they cultivated and sell the products they harvested.
Also opened to the outside: He traveled to the US and sealed ties with Washington, after the historic first step that Richard Nixon took when visiting China in the last years of Mao, in the middle of the Cold War.
Thus, commercial contracts between the PRC and the West began, giving way to the entry into the Asian country’s economy of foreign investments and iconic multinationals of capitalism, such as Coca-Cola, Boeing or McDonald’s.
“Socialism with Chinese characteristics”
The economic model introduced by Deng, based on a market economy, It was officially named “Socialism with Chinese Characteristics.”
It was a successful formula that allowed China to begin grow to record levels and steadily, for four decades.
The World Bank estimates that more than 760 million Chinese people escaped poverty thanks to the reforms, something unprecedented.
Some experts call it “the most impressive economic miracle of any economy in history.”
Later leaders – Jiang Zemin, Hu Jintao and the country’s current president, Xi Jinping – maintained the opening-up reforms.
China modernized and today not only dominates the manufacturing of clothing, textiles and household appliances. It is also a technological giant.
If you look around you, you will see that many of the products you use come from there.
Xiaomi, Oppo and Vivo They are some of the largest telephone companies in the world and Huawei is a leader in the development of 5G technology.
Lenovoanother Chinese private company, is the one that sells the most computers in the world.
and the platform Alibaba is one of the leading e-commerce companies on the planet.
All in all, it is worth asking: can we continue calling China a communist country?
Absolute power
From a political point of view, the answer is: definitely, yes.
A century after its creation, the CCP remains the only political force in China and governs vertically and hierarchically, with leaders in each city and region of the country.
The party structure is pyramidal and at its base there are more than 95 million members.
The president of China is elected by the National People’s Congress – the Parliament – which is controlled by the CCP.
And the party controls all senior government officials, leaders of state-owned enterprises, schools, hospitals and social groups.
“The CCP is not a political party as we understand this type of organization in a multi-party democracy. It is a Party-State“Explained in an article in the Foreign Policy magazine Jean-Pierre Cabestan, professor of Political Science at the Hong Kong Baptist University and one of the leading experts on China.
This Party-State pays much attention to the control of its ideology: there is no freedom of the press and, with the exception of a few private print media, the media sector is under state control.
According to the human rights organization Human Rights Watch, the Chinese government “maintains strict control over the internetthe mass media and academia.”
It also “persecutes religious communities” and “arbitrarily detains human rights defenders.”
But if you analyze the country from an economic perspective, There the story is different.
“The heavy hand of the party”
“Economically, China today is closer to capitalism than to communism,” international analyst and Asia expert Kelsey Broderick told BBC Mundo.
“It is a consumer societywhich is totally opposite to communism,” he highlighted.
However, Broderick warned that, although at first glance the Chinese economy appears completely capitalist, “if you peel back the first layer, you can feel the heavy hand of the party“.
The control exerted by this “invisible hand” is felt more at the top of the economic pyramid, he says. The state determines, for example, the price of the yuan and who can buy foreign currency.
And it is the one that controls the largest companies in the countrywho manage natural resources.
The CCP is also officially the owner of all the land in Chinaalthough in practice people can own private property for a certain number of years.
AND controls the banking systemso it decides who gets loans to.
Even private Chinese companies must undergo state inspections and they have “party committees that can influence decision-making,” says Broderick.
The latter also occurs with some foreign firms operating in the country, in the event that they have three or more CCP members employed (a not uncommon situation considering the more than 95 million members).
This blurred boundary between the private and the state is behind the controversy that has affected in recent years Huawei, after the US accused China’s main private telecommunications equipment company of being a front for state espionage (something the company denies).
“State capitalism”
These socialist features that still persist in the Chinese economic model, and which have led many analysts to call it “state capitalism,” have also exacerbated the trade war between China and the US
Although the conflict focuses on the trade balance, heavily tilted in favor of Beijing, Washington and other Chinese trading partners They complain about the enormous state aid that private Chinese companies receiveand that put them at an advantage over their international rivals.
“Chinese private companies have a double advantage: they take loans from public banks and receive energy subsidies from state companies that control all the country’s energy production,” says journalist and international analyst Diego Laje.
Laje, who was a presenter on China Central Television (CCTV) in Beijing and Asia correspondent for the American network CNN, believes that China “cannot be called capitalist because it does not comply with the requirements and commitments of the World Trade Organization ( WTO), to which it joined in 2001 and which still does not recognize it as a “market economy.”
However, the journalist highlights that “on a day-to-day basis, the intervention of the State is not felt, which gives a feeling of freedom” that in many ways makes the Chinese economy operate like a capitalist system.
Inequity
Although the liberalization of the economy has greatly reduced poverty, it has also the gap between rich and poor has increased.
It is noticeable in health services: the majority of Chinese depend on the public system, which is often overcrowded, but the richest go to private hospitals.
Chinese education has also undergone changes. It is still state-owned but it is no longer completely free.
“There are 9 years that are mandatory and are not paid. But to go to high school and university you have to pay“Xiao Lin, an interpreter originally from southeastern China who emigrated to Beijing to study and work, told BBC Mundo.
Xiao is one of the many people who suffer from deep real estate crisis China is going through, with tens of thousands of new houses unsold because many cannot afford them.
“Houses are becoming more expensive and only the rich can buy them. Young professionals like me cannot afford to have our own home and we depend on our parents or grandparents,” he says.
These socioeconomic differences are very far from what communism proposeswhich points precisely to eliminate social classes.
Contradiction?
¿How the CCP explainswhich in the past persecuted those who believed in “capitalism,” the success of its “state capitalism” What has led China to become the second largest economy in the world?
According to Anthony Saich, director of the Ash Center at Harvard University and author of the book From Rebel to Ruler: 100 Years of the Chinese Communist Party, the party leadership simply changed the story.
“China’s current leaders they have rewritten history in a way that erases this aspect of official history,” he told BBC Mundo.
“While they admit that Mao may have made some mistakes, they ignore the attack on the ‘followers of the capitalist road’ and explain the Cultural Revolution as an experiment from which the party learned. They emphasize that It was an attack on corruption, on bureaucratismetc.”.
“Xi Jinping, instead of seeing the post-1949 era as divided into two stories (one under Mao and one under reforms), sees it as an unbroken line of experimentation that has resulted in what the party is today,” he noted.
Saich, like many other experts, highlights that, under Xi, China “has moved away from the more liberal influences of the market that were previously experienced.”
For his part, Laje observes that he has also hardened. “The levels of repression and control are increasing and technology has been perfected so that today China is a perfect police state“.
For Broderick, the Chinese leader “is convinced that the disintegration of the Soviet Union occurred because they left aside their communist roots and he does not want that to happen in his country.”
However, when asked whether Xi’s China is becoming more capitalist or more communist, Saich believes that neither option is correct: “It is more statist.”
*This note was originally published on October 1, 2019, for the 70th anniversary of the founding of the PRC, and has been updated.
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