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| Yes | 63% | 119 votes | Total: 190 votes | |
| No | 37% | 71 votes |
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Add to Favorites"Black cat, white cat, what matters is whether it catches the mouse." is how Deng Xiao Ping justified allowing private capital enterprises and these have been the main source of the tremendous economic activity and growth in China. Certainly, this hand-picked protege of Cho-en-lai and defacto supreme leader of the PRC would not have arrived at that conclusion if he felt that he had an alternative. Although Deng was sidelined twice during his long career, he remained a committed communist to the core.
The forcefully brutal experiments in social engineering of "the Great Leap Forward" in the late 1950's and "the Cultural Revolution" of the 1960's taught abject lessons concerning the practicality of collectivized economic activity. Initially, there were bursts of excitement by abusive, young hot heads, but the vast majority of the population quickly lost motivation for anything more than the absolute minimum of effort. That was because it was generally known that in communist organizations, all received the same level of compensation, regardless of effort or results. People were demotivated. The minimalist attitude spread far and wide and was seen visibly throughout society. Termed "the iron rice bowl syndrome", it resulted in the PRC having major economic reversals at that time.
Then, it began as isolated experiments in the enormous collectivized farms. In their after hours, some commune leaders allowed private citizens to cultivate their own fields on second quality land. Amazingly, the best quality and progressively larger quantity of produce came from the private activity. It soon became evident that in order to feed its own population, China needed the output from the private farms. This politically-dominant communist co-existence with politically-inactive , private businesses spread through out society. It began first among the progressive coastal provinces and it gradually co-opted the entire nation.
Today, a significant majority of business activity in China is conducted by private capital enterprises, the source of innovation and dynamism. Although many Chinese public behemoths continue to exist, they tend to be less enterprising than the capitalist businesses. Thus, over time, the influence of private capital has taken firm root and become increasingly dominant in the market. Today's reality is that vast areas of the economy have been effectively privatized. The daily impact of capitalistic activity on all of China is immediately apparent and undeniable. Without doubt, in many important respects, China is very demonstratively a capitalist society.
Why should that be surprising, when the most thriving overseas Chinese community of Singapore also exhibits a remarkably closed, authoritarian and patriarchal political system? Those same characteristics are also true of the government of the PRC. Could it be that the Chinese are culturally inclined to accept an absolute authority, like a monarch, yet also naturally predisposed towards a capitalist society? Or is this merely more proof of Maslaw's Laws of Motivation in application?
Learn more about this author, Robert C. Sage.
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No
China has certainly not become a capitalist society. The nation's people on the whole work for very little pay. Their economy that used to be largely communist still is. The factors that have changed over the past decade or so is the reduction in the dependence upon the agricultural sector. Industry and consumer goods have become the nation's key to higher prosperity. The definition of a capitalist society involves the ability to raise capital on the financial markets and being able to trade on a free market basis.
However the banking system which has seen leading western banks move into being able to operate in China have freed the country into a slightly better position, however the only people benefiting from the capitalist notion are the large companies and wealthy individuals who in turn feed off the hard work of the employees that make the goods. The workers get paid little who help the bosses of the Chinese corporations their capital.
Banks in China have been affected by high levels of bad debts by lending money to people around the world including China, which also means that whilst the bad debt write-downs which have been publicised around the world the Chinese also at some stage will feel the credit crunch. The government of China surely will have realised that the effects caused by Western banks and would have resulted in the curbing of lending to individuals.
The theory of capitalism itself involves no government bail outs of banks, and once banks are broke they should not be given state hand outs in an attempt to boost the failing bank's liquidity. Therefore China has not become a capitalist society as the foundations are that private lending is done through the bank of China and western banks have little liquidity and face a scenario where the lending of banks is low as there own liquidity has been affected through the global credit crisis. Also by definition state intervention by banks in handing out loans to individuals will also mean that China has not become a capitalist society.
The small number of people who benefited from the country were the landowners and the rich who were in place during the 1980's. The poor people who probably represent over 90% of the population of China are in effect at the heart of the crisis as they will struggle to make ends meet in a socialist feudal type of economy. Much overhaul of the banking system is needed and from a social and economic view before China is to be considered a Capitalist society.
Learn more about this author, Costas Chryanthou.
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