Category Archives: Xi Jinping

Hong Kong: Can Two Million Marchers Be Wrong?


In February 2003, protest organizers estimated that nearly 2 million people took to the streets of London in opposition to going to war against Iraq. United States president George W. Bush came across as dismissive of the protestors, likening them to a “focus group.”1 The number of protestors did not deter Bush and United Kingdom prime minister Tony Blair from their path.

The aftermath was that the US, UK, and other allies initiated a lopsided war based on “intelligence and facts [that] were being fixed around the policy” of military action.2 Iraq did not possess weapons-of-mass destruction; it was as United Nations weapons inspector had warned beforehand that Iraq was “fundamentally disarmed.” What transpired was an act of aggression — which the Nuremberg Tribunal described thusly:

To initiate a war of aggression, therefore, is not only an international crime; it is the supreme international crime differing only from other war crimes in that it contains within itself the accumulated evil of the whole.

Furthermore, the US-led debacle against a sanctions-weakened Iraq is compellingly argued, by lawyers Abdul Haq al-Ani and Tarik al-Ani, as an act of genocide by the US, UK, allies, and the UN Security Council.3

Two Million Demonstrators Take to the Streets of Hong Kong

On 27 June, the Hong Kong Free Press reported about 200 people protesting outside secretary for justice Teresa Cheng’s office. On the following day, a counter demonstration of around 200 people made the rounds of 19 foreign consulates demanding that foreign countries not interfere in the internal affairs of Hong Kong

Just days earlier, crowds estimated at one and two million people took to the streets to protest in Hong Kong. Protest against what?

Fingers point to a gruesome incident that occurred between a Hong Kong couple while on vacation in Taiwan. A young, pregnant woman was murdered, allegedly by her boyfriend. The boyfriend was jailed for the theft of her money and personal effects, but a trial for the killing outside of Hong Kong’s jurisdiction is prevented. And there is no extradition agreement between Hong Kong and Taiwan.

The possibility of a release as early as October of 2019 has been provided as a reason for the expedited passing of an extradition bill.

What was unexpected was that so many Hong Kongers would oppose it.

The protests have been effective in first having amendments made to the bill, and subsequently sidelining the bill, but it may be resurrected for a vote at a later date. The Hong Kong government amended the extradition law to serious criminal offenses only, those carrying a minimum sentence of 7 years’ jail time, for those who committed a crime elsewhere and returned to Hong Kong. A person who commits an offense in Hong Kong would not be extradited to mainland China.

The Boogeyman of Fear

Why the hullabaloo over an extradition bill when Hong Kong already has extradition agreements with 20 countries, including the UK and US?

Why should an extradition agreement with other countries cause such a ruckus? If one peruses the corporate-state media, a clear answer emerges: fear; it is a perceived fear of what China may do to a person extradited to the mainland. Is this a rational or justifiable fear?

The South China Morning Post states, “[C]ritics fear Beijing may abuse the new arrangement to target political activists.”

Germany’s DW cites critics who say China “has a poor legal and human rights record.”

“Protests have been raging in Hong Kong against a controversial extradition bill, which, if approved, would allow suspects to be sent to mainland China for trial.”

Al Jazeera writes that people in Hong Kong fear China’s encroachment on their rights.

The Guardian highlights a Hong Konger who was “waving a large Union Jack flag, a tribute to the British colonial era before the city was handed back to China’s rule, and implicit attack on Beijing.”

The Guardian article claims, “The alarm over the bill underscores many Hong Kong residents’ rising anxiety and frustration over the erosion of civil liberties that have set the city apart from the rest of China.”

The New York Times downplayed Chinese sovereignty over the semi-autonomous Hong Kong by pointing to a large, white banner which read, “This is Hong Kong, not China.”

The Financial Times writes, “Critics fear the law would allow Beijing to seize anyone it likes who sets foot in the territory — from a normal resident to the chief executive of a multinational in transit — and whisk them off to mainland China on trumped up charges.”

What about Edward Snowden?

Back in 2013, ex-CIA employee Edward Snowden left the US for Hong Kong with a thumb-drive stash of secret NSA documents, which he turned over to some hand-picked journalists. Snowden was not beyond the reach of the US in Hong Kong, and the American government sought his extradition. Snowden, however, was allowed to depart Hong Kong for Moscow. Apparently, the Americans “had mucked up the legal paperwork.”

Hong Kong had no choice but to let the 30-year-old leave for “a third country through a lawful and normal channel.”

Those refugees in Hong Kong who helped Snowden elude apprehension have not fared as well as Snowden. Human-rights lawyer Robert Tibbo described the situation bluntly: “Refugees are marginalized to such an extent, that they are Hong Kong’s own version of Untouchables.”

Yet, despite what is transpiring in their own backyard, Hong Kongers are in the streets saying they fear what might happen to those who might be extradited to mainland China.

What about Julian Assange?

Hong Kongers and the state-corporate media are expressing fear about what China may do. But what about two countries that Hong Kong has an extradition agreement with — the US and the UK? One only need point to the current egregious abuses meted out to Julian Assange to dispel any notion of justice. And why is Assange’s extradition being sought? For exposing US war crimes!

Relations with Mainland China

China’s chairman Xi Jinping is unremitting in his battle against corruption, but also his political platform includes “promot[ing] social fairness and justice as core values.”4 Is this something to fear?

There is the case of the disappearance of Hong Kong booksellers. There is also concern about the arrest of human rights lawyers in China. I am not about to state that the application of the law in China is perfect. But where is justice perfect? China does practice censorship, but freedom to speak has limits. One instance of when censorship is justified: to prevent the dissemination and spread of disinformation. Consider the image at left, while the actual size of the demonstrations were massive, the image was “heavily edited — cropped and mirrored — to multiply the size of the crowd.” It has gone viral with subsequent republications failing to mention the editing and cropping.

Then there is the omission of information, such as the purported funding of the protests in Hong Kong by the US government and a notorious CIA-affiliated NGO, the National Endowment for Democracy. This is backed by various western governments expressing sympathy for the Hong Kong protestors.

The often bandied-about criticisms concerning China are of authoritarianism, lack of democracy, and lack of freedom.

Is China authoritarian? China, through the Communist Party of China, defines itself as a state practicing socialism with Chinese characteristics. It promotes as its core values: prosperity, democracy, civility, harmony, freedom, equality, justice, the rule of law, patriotism, dedication, integrity, and friendliness. China practices utilitarianism aiming its policies at what best benefits the majority of its citizens. China promotes peace and harmony; it emphasizes diplomacy and avoidance of war.

To allays fears, Xi said in a speech in Berlin:

As China continues to grow, some people start to worry. Some take a dark view of China and assume that it will inevitably become a threat as it develops further. They even portray China as being the terrifying Mephisto who will someday suck the soul of the world. Such absurdity couldn’t be more ridiculous, yet some people, regrettably, never tire of preaching it. This shows prejudice is indeed hard to overcome….

The pursuit of peace, amity and harmony is an integral part of the Chinese character which runs deep in the blood of the Chinese people. This can be evidenced by axioms from ancient China such as: “A warlike state, however big it may be, will eventually perish.”5

Democracy? Wei Ling Chua in his book, Democracy: What the West Can Learn from China, sought to compare and contrast the effectiveness of western and Chinese political systems scientifically. The assumption is that the well-being of the citizenry is the raison d’être of a government. To determine this, Chua gauged government responsiveness to the needs of the people during a disaster. The response of the Australian and American governments compared unfavorably with the Chinese government’s response to disasters. Chua writes this is because “… the culture and beliefs of the Communist Party in China is more people-oriented than those of the capitalist elites in the West.”6 Besides, what democracy did Hong Kong enjoy under British until the time of a handover approached? Is not the imposition of colonial status through war to facilitate opium exports a total abnegation of democracy and freedom?7

I have lived in China for a number of years, and I feel just as free here as anywhere. Of course, I wouldn’t stand on a soapbox with a megaphone and shout anti-China slogans, but I wouldn’t do that anywhere about that country’s government. The right to peaceful protest, however, should be respected. The Chinese people around me do not complain of feeling unfree. As already stated, there is censorship. Very few people here are aware of the protests taking place in Hong Kong. But freedom is not just about speech. What about freedom from poverty? One in five Hong Kongers live in poverty, a number that is on the increase in Hong Kong. Contrariwise, the year 2020 is targeted as the year that poverty is eliminated in China.

Etiology

Charles Chow (pseudonym for an American who lives on and off in Hong Kong) gave his perspective:

The big issue isn’t the [extradition] bill at all or even the relative lack of democracy in Hong Kong…. It’s two fundamental issues that have existed since the colonial era, but worsened since the handover: a growing wealth gap and the lack of affordable housing. The government hasn’t done much to resolve them and neither has China. Their failure to tackle these problems has made Hong Kongers less trustful of them and more irritable overall. Therefore, even small controversies will point back to these bigger issues.

I agree with Chow’s identification of two fundamental issues. However, I fail to see why in a one country, two systems situation that Beijing should be held responsible for the resolution of problems associated with the Hong Kong system of governance. Moreover, the yawning chasm in the percentage of those living in poverty under the system in Hong Kong versus the system in mainland China (under 1%, for a much larger territory with a huge population, therefore, posing greater challenges for effective governance) suggests the Hong Kong system is majorly flawed in at least one important aspect.

Now it’s 22 years after the handover–an entire generation has passed. The legacy of colonialism will linger for a while, but the current government has had two decades to resolve any problem the British left behind. Hong Kong’s economy is still robust, but its gains have been unequally distributed.8

Chow continues:

Its housing prices are just obscene–especially given the size and build quality of the properties they represent. Neither problem shows any sign of abating and both are, in fact, getting worse. Thus, even some Hong Kongers who are pro-Beijing have expressed concern over both problems because they know neither discriminates by political affiliation. Where they differ from the pro-democracy crowd is how to resolve them.

The pro-democracy folks believe giving more people a say in how Hong Kong operates (in other words, more democracy) is the solution. The pro-Beijing folks think the current government, along with China, should be able to do something. But this government, beholden as it is to the tycoons and China (such an odd couple), isn’t going to tackle these problems. Because it won’t, it has created a growing body of restless Hong Kongers, many of whom were once apolitical and probably even opposed Occupy in 2014.

It didn’t have to be this way. In a fairer world, Hong Kong would have a manageable wealth gap and be able to provide affordable housing for most of its people. In such a scenario, even most people who aren’t crazy about China would accept its sovereignty and foreign attempts to get them to protest Chinese rule would go nowhere.

Even if an extradition bill were proposed, there’d be fewer people showing a concern over it.

Epilogue

Imagine if a country were to invade and occupy Hawai’i for the next century9, after which Hawai’i would be semi-liberated from occupation. Would Hawaiians wish to rejoin the US? Might not new systems, cultures, and languages have been injected during the occupation/colonization have affected the mindset of the later generations?

The roots of the opposition that many Hong Kongers feel toward the extradition bill arguably lies further back in history. Clear-minded logic leads to the realization that if Britain had not started the Opium Wars (a crime of aggression) and occupied Hong Kong, thus severing Hong Kong from Beijing’s rule, there never would have been a need for the difficulties that arise from the one country, two systems currently in place. A de facto city-state would never have been able to become a haven for fugitives from the central government. Hong Kong would have remained a part of China. The same logic holds true in the case of Taiwan. If Japan had not occupied Taiwan, and if the US had not intervened to protect the Guomindang remnants that fled across the Taiwan Strait, Taiwan would likeliest have remained a part of China to this day.

The source of the current tensions in Hong Kong did not originate in Beijing (unless one blames Beijing for being too militarily weak to protect its territorial integrity and prevent its citizens from being transformed into drug addicts).

This is missing from much of the western corporate-state media news. While China seeks to safeguard sovereignty over its landmass, Britain holds fast to its enclave in Northern Ireland. It ignores justice and maintains an ethnic cleansing that it and the US imposed on the people of the Chagos archipelago. The US itself is a nation erected through the denationalization of Indigenous nations.10

How is it then that western nations and their western media have a moral leg to stand on when criticizing other nations, such as China, for fear of criminality that pale in comparison to those crimes that the western nations have committed?

Can two million marchers be wrong? They are not wrong about the right to march or the right to protest. Are they wrong to oppose the extradition of persons for serious offenses to China? Are they wrong to fear China? Do they genuinely fear China? This fear of mainland China is seemingly so negligible that 6.9 million of the 7.4 million Hong Kongers hold a Homeland Return Permit to ease travel to and from China. Is it sensible for people to travel to a jurisdiction that they fear?

The comparison is stark.

Compare protesting the launching of a war wherein upwards of 600,000 people were killed11 (now being killed that is something that most people fear) to protesting the upholding of law to ensure murderers should face justice. If, indeed, China is governed by a scofflaw government, then there is a justification for having fear. But before casting final judgement, western countries ought to look deeply into the mirror, the mirror that reflects the not-so-long-ago devastations of Palestine, Yugoslavia, Iraq, Libya, Syria, and other lands. China’s last battles were with India and Viet Nam many decades ago. The Communist Party of China (CPC) states an abhorrence of wars and promotes peaceful resolution of differences.5

The CPC acknowledges that it is dependent on the support of the people; without it the party will fall. The CPC’s raison d’être is the well-being of the people, what is called the Chinese Dream.

It would be foolish and contradictory for Beijing to upset Hong Kongers. Harmony is, after all, a core value of socialism. The one country, two systems is due to expire in 2047. Likewise, Hong Kong has nothing to gain from irritating Beijing. However, should Hong Kong integrate into the economic system of China, it stands to see the elimination of poverty in the former British colony.

  1. Said Bush, “First of all, you know, size of protests–it’s like deciding, `Well, I’m going to decide policy based upon a focus group.’ The role of a leader is to decide policy based upon, in this case, the security of the people.”
  2. As revealed in the Downing Street Memo. The website, however, no longer is accessible. The page reads: This Account has been suspended. The memo is available at this pdf.
  3. See Abdul Haq al-Ani and Tarik al-Ani, Genocide in Iraq: The Case Against the UN Security Council and Member States. Review.
  4. “We should address the people’s proper and lawful demands on matters affecting their interests, and improve the institutions that are important for safeguarding their vital interests.” Xi Jinping, The Governance of China (Beijing: Foreign Languages Press, 2014): 35%.
  5. Xi Jinping, “China’s Commitment to Peaceful Development” in The Governance of China: 35%.
  6. Wei Ling Chua, Democracy: What the West Can Learn from China (2013): location 1214. Review.
  7. See Samuel Merwin, Drugging a Nation: The Story of China and the Opium Curse (Toronto: Fleming H. Revell Co, 1908.
  8. The income distribution in Hong Kong has become extraordinarily high. — KP
  9. Never mind that this is what happened so that the US mainland could depose the Hawaiian monarchy.
  10. See Roxanne Dunbar-Ortiz, An Indigenous People’s History of the United States (Beacon Press, 2015). Review.
  11. Burnham G, Lafta R, Doocy S, and Roberts L, “Mortality after the 2003 invasion of Iraq: a cross-sectional cluster sample survey,” Lancet: 368(9545), 21 October 2006: 1421-8.

Trump and the Taiwan Gambit

Taiwan has become a new “eastern pivot” for Donald Trump. Against all international laws and UN charters, he is approaching Taiwan, as indicating to the world that regardless of the established world rules which make Beijing, the Peoples Republic of China (PRC), the official and legitimate Authority of China, with Taiwan being a part of China – the self-styled emperor, Mr. Trump, pretends he prefers dealing with Taiwan as an independent country. By doing so, he intends to invite others to do likewise. Trump wants to make Taiwan an ‘ally’ – dreaming of setting up a US base on the island, thus further encircling China. It is the old game, divide to reign. But he can’t be as ignorant as to believe it will actually work. It’s just one more thing to annoy PRC. Frankly, seen from a step back, it looks more like attempting to dump one of those primitive Trumpish ‘diplomatic’ bombshells on PRC’s back. Provoking the Dragon?

Dragons can be lethal, especially if exposed to nonstop strings of insults and debasement, attacks, and threats, sanctioned with trade wars, subjecting US$ 200 billion worth of Chinese exports into the US with 25% import tax, and, mind you, Trump just issued a new threat –raising the ante to US$ 300 billion, in case China refuses to attend the G20 summit in Osaka, Japan on 28-30 June 2019. Can you imagine the insolence, ordering President Xi to attend the G20 summit?!? The man has indeed no manners, diplomatic or otherwise.

Trump further bragged on Monday, 10 June, that China will make a deal with the United States “because they’re going to have to.” And what would be the deal? He never explained. He added, “China has lost trillions of dollars since he, Trump, was elected president.” Imagine this impunity in recklessness!  Well, surely, President Xi Jinping will not be duped or blackmailed by Trump.

On another front, Trump threatened Mexican’s new President Andrés Manuel López Obrador, AMLO for short, with a 5% tariff on Mexican agricultural exports to the United States, if illegal immigration to the US would not stop. AMLO approached President Trump with an open letter, saying that he seeks peace and not confrontation, dialogue not war, and that AMLO’s government will do whatever is in its power to stop illegal migration to the US.

He stated, correctly, that a trade war would do more harm than good to both nations. Trump then dropped the threat, with worldwide publicity, to make sure his ‘goodness’ is recognized the world over. However, just a few days ago, Trump threatened Mexico again with the 5% tax, in case AMLO’s promise doesn’t hold and poor Mexicans keep illegally crossing the border into the great Promised Land (no, not Israel, but the western extension of Israel).

Of course, this tariff has nothing to do with trade. It is punishment, a sheer demonstration of supremacy. And, never mind, Trump probably doesn’t understand that California’s agriculture thrives on the low-wage illegal Mexican and Central American immigrants.

It is nevertheless amazing that the (western) world stands by and dares say NOTHING. The threats of sanctions seem to be effective. Anybody, or any nation that refuses to go along with Washington’s thuggish criminal behavior, may be subject to punishment, be it by trade and/or financial sanctions, or outright military intervention. There is no international law, no rules of the community of nations, no political common sense that is respected by Trump and his handlers, and the world is afraid. Even though so far most of the threats have amounted to nothing more than ridiculous blabber and saber rattling.

More threats were thrown at Iran, with more sanctions and economic strangulations if Iran doesn’t “behave”.  Actually there are hardly any explanations given what “good vs. bad behavior” would mean for the US, other than Washington’s repeated empty accusations of Iran being a nuclear threat, disregarding the Joint Comprehensive Plan of Action (JCPOA), or nuclear deal signed in 2015, freeing Iran of any further accusation of wanting to become a nuclear power (which, by the way was a farce in the first place – the subject for another essay).

This so-called nuclear deal was signed by the 5 UN Security Council members, including the US. But as we know, under pressure from Netanyahu, Trump reneged last year from the deal – and since then horrendous sanctions of economic strangulations and foreign asset confiscations – outright theft, in clear text – were imposed by the US on Iran, with ongoing pressure on the EU to do likewise. According to Trump – and his two minion mouth-pieces, Pompeo and Bolton – more are to come.

To that, Iran’s Foreign Minister, Mohammad Javad Zarif, stated that Iran will not be blackmailed and added the philosophical observation that Trump’s economic wars around the globe will eventually backfire. Well, yes. Trump’s reckless playing with tariffs, sanctions and other punishments around the globe will eventually drive everybody away from dealing and trading with the US, including away from the western monetary system. It’s the silver lining of the dark-dark US cloud. It’s economics 101.

Propelled by German business interests (but at the same time limited by Washington [and Brussels] on what he is allowed to say), German Foreign Minister, Heiko Maas, visited Iran a few days ago to seek a compromise for Germany and other EU members to still hold on to the Nuclear Deal, because Germany’s economy wants to deal with Iran, yet, seeking concessions from Iran that may assuage Washington. But Iran’s Foreign Minister, Zarif, didn’t fall for it. The meeting ended in nothing. Good so, because there is nothing, absolutely nothing, that any ally (except Israel) could do to change the Bully’s mind on Iran.

Frankly, does Trump seriously believe he possesses all that power over other world leaders? Or is he, Trump, just a convenient lackey of a force much stronger behind him, a force that controls both the Pentagon and, more importantly, the western financial and banking system – the Zionist designed western dollar-based monetary system. This Ponzi scheme has been able for the last 100 years or so – and as we witness, every day more – to usurp the world, holding it hostage, with artificially created economic booms and busts, with economic sanctions, strangulations, confiscation, with the theft of nations’ foreign assets and even their reserve funds, if they don’t bend to the will of the self-proclaimed super power USA.

Yes, it’s a fading super power, but it still has control over its forced allies and vassals – many of whom, by now are sick and tired of their ally-cum-vassal status, as they realize what their losses are. They believed in economic, diplomatic and military privileges, but are gradually awakening to reality. Progressively they see the empire as what it is, a shiny, blustering, preposterous house of cards that may come crashing down at any time. Their anger and courage of Washington’s vassalic allies is slowly raising, and they will eventually break out from their repressive situation. When that happens – and Trump is hastening that moment with his erratic ‘sanction-prone’ behavior around the world – a grand geopolitical shift for the better may take place.

With this partial backdrop of what the globe is facing – Taiwan is just becoming the latest peon in the war for preparation of Washington’s big WAR – dominating China and Russia. Making Taiwan – which is legally and by all international rules part of PRC – a US ally and vassal, would further close the US power circle around the East Asian space. Trump may believe he is moving closer to ‘checkmate’, dominating the formidable Russia-China alliance.

With all the flattering and roses the leaders of Taiwan may get from Trump, do they realize that their role will just be that of one more enabler to enhance the empire’s dominion and increase the US’s wealth by helping it steal more of the world’s resources?

In the end, Taiwan may just become a mess, a chaotic island with lots of loose ends, with people pulling in different directions, as they realize that their government has been “bought” to give away their partial sovereignty and well-being, and they will raise up.

Taiwan, just look around the world! The latest example being Sudan. Orchestrated chaos is controlling Iraq, Afghanistan and Syria? And look what is being planned, so far without success, in Venezuela? Taiwan will just be another pawn on Zbigniew Brzezinski’s legendary Grand Geopolitical Chessboard.

The US has been fomenting worldwide hostility against China and Russia for the last 100 years, and especially since WWII, intensified by the fake and false Cold War, made possible thanks to an all-western-dominating AngloZionist lie-propaganda machine.

We know about “Russia Gate”, the never-ending bashing of President Putin and Russia. The more subtle US attempts to destabilize China have started soon after China had become fully self-sufficient and autonomous, when she gradually opened her borders to integrate into the world with exports and attracting foreign investments in the 1980’s. The so-called Nixon ‘ouverture’ to China, Nixon’s one-week trip in 1972 to Beijing, Hangzhou, and Shanghai, was perhaps the first attempt by Washington to use the huge Chinese market for US exports, and at the same time constraining China’s rapid and foreseeable economic growth. Indeed, China grew exponentially and in 1986 gained observer status at GATT (General Agreement on Tariffs and Trade), a precursor to WTO, and started negotiating membership of the World Trade Center of which she eventually became a member in 2001.

Trade, Chinese highly competitive exports was then – and is today – a key issue for the US goal of world hegemony. In anticipation or rather to prevent China from becoming a world economic powerhouse, Tiananmen Square protests were introduced in 1989. The lead-up to the so-called massacre was a huge false flag. A student protest movement, funded by the US State Department, through the infamous NED (National Endowment for Democracy – an “NGO” specialized in “regime change” operations – see also Venezuela). The 4th of June crackdown had been prepared months before, guided by the bloody hands of US Secret Services, CIA, NSA, and most probably MI6. The “students” had no common cause for the protest, just a sudden desire for more “freedom”, “reforming the communist party” without citing specifics they wanted reformed.

The 4th of June 2019 anniversary of the ‘massacre’ 30 years ago, is used by the western media to propagate against Chinese “tyranny”. The news of the massacre was repeated every hour on the hour by almost all radio and TV stations throughout Europe, lest you might forget, and the too-young-to-remember – should learn and be prepared for the coming Chinese monster. That’s the goal of the corporate presstitute. And they may succeed, as sleeping people have no clue of the truth, nor are they interested in abandoning their comfort and facing the inconvenient truth.

Let’s just juxtapose the forced memory of Tiananmen Square with real atrocities being perpetrated by the west, as these lines go to press. Take Yemen, devastated by the west and its proxies, chiefly Saudi Arabia and Qatar, with weapons and funding from the US, the UK and France. Yemen is a non-aggressive peaceful country. Tens of thousands of people have been killed in the last 4 years of this atrocious war, most of them children and women, thousands from cholera and other water and improper hygiene related diseases; two thirds of the population suffer from famine. The related death toll is in the tens of thousands. This is exacerbated by the Red Sea Port of Hudaydah, the gateway for most of Yemen’s imports, being shut by Saudi and Qatari armed forces, so that not even emergency aid enters the country. The UN calls it the largest humanitarian crisis in recent history. You hardly hear anything in the western news about this western-funded and executed atrocious mass killing.

False flags from Tiananmen Square, to 9/11, to the Ukraine Maidan, to the sporadic string of terror killings in Europe and the United States, by ISIS / IS Al-Qada and associated groups –  all funded by the empire and its proxies and vassals – to the more recent ‘regime change’ or Color Revolution type protests in Hong Kong, the Umbrella Revolution of 2014 and street protests of the last week, with thousands of protesters in the street against a Beijing initiated extradition law to be introduced by Hong Kong’s legislation are all US / western instigated, funded and guided so as to provoke and destabilize China.  And foremost, demonize China in the eyes of the western world. Most western countries have extradition laws for criminals to be turned over to the jurisdiction of the country where they may have committed the crime. But that’s not mentioned by the corporate lie-propaganda.

These permanent aggressions against the world power China, a world power with a pacific non-expansive life philosophy, could badly backfire. Just imagine, Beijing may eventually get sick and tired of Washington and its vassal-allies meddling in PRC’s internal affairs, could easily repeal Hong Kong’s semi autonomy and incorporate the city fully into the territory of the PRC – complete with Chinese laws, obligations and benefits. As simple as that. What would Washington do? What would the west do?  Scream murder?  Well, they do that already, so it couldn’t be much worse. A military aggression on China?  Hardly. The West wouldn’t dare. Attacking China is attacking Russia. There is a strong alliance between the two countries, one that was made even stronger by several new agreements signed between Presidents Putin and Xi during the recent St. Petersburg International Economic Forum.

Similar provocations are planned and take place with Taiwan. In April 2019 the US sent two destroyers into the Taiwan Straits, claimed by mainland China as their territorial waters. Germany, which according to their armistice status’ obligation of non-confrontation and non-aggression, is considering sending a war ship to join the US and French warships in an attempt to demonstrate to the world that these are international waters.

What if such provocations, rather than gathering more world recognition of Taipei’s self-styled autonomy, they prompt President Xi Jinping to close in on Taiwan and actually absorb the island as a PRC owned territory? This would just conform to what Taiwan nominally already is since 25 October 1971, when the UN General Assembly Resolution 2758 declared The Peoples Republic of China as the sole legal China.

Switch to another corner of the world with a different but very much connected scenario. Early this morning, 13 June, in the Strait of Oman, about 25 km from the coast of Iran, a Japanese-owned and a Norwegian oil tanker (the owner of which is an old friend of Iran’s) were attacked. Explosions and fire broke out, some seamen were injured, and 44 were actually rescued in the Gulf of Oman by Iranian ships. As of now, it is not clear what happened and who the perpetrators were. Never mind, Pompeo immediately accused Iran for the attacks – and keeps doing so, stating falsely that video evidence – never offered to be seen by the public – showed it was Iran. Why would Iran attack a Japanese oil tanker, while Japanese Prime Minister, Shinzo Abe, is visiting Iran’s Supreme Leader Ayatollah Ali Khamenei in Tehran on Thursday, the very day of the attacks, for talks to maintain the treaties of the Nuclear Deal?

World! Let’s face it. Only an idiot will believe that Iranians are so idiotic as to attack foreign vessels in the Gulf, clients and friends of Iran. If this smells like a false flag – it is a false flag. Carried out by whom? Could be the Saudis, Israel, the Emirates, Mossad, the CIA, MI6… any one of the puppet allies of the emperor.

People, where are we going? As a result of this incident oil prices rose immediately by up to 4% for fear that worse might happen, namely that Iran might close the Strait of Hormuz through which about 25% of the world’s hydrocarbon are shipped. A closure could have oil prices jump to USD$ 200 / barrel or more – and sink the world in the worst recession of recent history. In the meantime, Wall Street bankers, notably Goldman Sachs, who have ample experience with oil price manipulation, are already playing with oil futures which under such a scenario could bring them hundreds of billions while the rest of the world goes belly up.

On another, but very much related topic: Many, especially unaligned countries, are losing trust in the US and especially in the US-dollar. They are quietly switching their reserves to Chinese yuans and / or gold. Trump’s handlers know about it. They may be contemplating as a last resort a new kind of gold standard. Losing out on dollar hegemony is one of the reasons they are pushing The Donald into a trade war with China. The (US) expectation is that a trade war with China would debase the Chinese currency, thereby discredit it and make it unattractive as a reserve money.

Creating a conflict between PRC and Taiwan, might, from a US point of view, have the same effect, degrading the yuan, in addition to bringing other Asian countries on board, those who are themselves worried about their territorial waters; i.e., the Philippines, Malaysia, Indonesia.

And yet, in an opposite corner of the world, namely in the swamp of Washington, the same Pompeo who just found another reason to increase sanctions on Iran, is utterly upset that his plans in Venezuela didn’t work out, because the stupid opposition cannot unite, cannot be trusted. That would leave only the ‘military option’ on the table – but that military option is too risky with Venezuela being supported by her strong allies, Russia and China.

Friends – what you must be aware of – all the dots of conflicts, wars, threats, harassments, false flags, sanctions and otherwise punishments, lies and lies and lies around the world, are dots that must be connected. Only then will you get the Big Picture – and to understand the Big Picture is crucial. It is at once hilarious for the phantasy it portrays and catastrophic for the danger it presents. For the owners of this Big Picture, the Washington Swamp and Israel, it represents the illusion and desire to achieve the US-Pentagon-Banking plan within the PNAC (), a wishful thinking of Full Spectrum Dominance.

This Big Picture is best portrayed by Chris Black’s latest master piece: This Outlaw Power: America’s Intent is to Dominate China, Russia and the World.

• First published by the New Eastern Outlook.

IQ, Equal Pay for Equal Work, Population Control, Mao, and Communism

“Prepare for Struggle, Prepare for Famine, Work for the People.”

Jordan Peterson posits IQ tests as indicators of intelligence and predictors of long-term success.1 This is not scientific. Intelligence is definitionally problematic as is designing tests to measure whatever is deemed to denote intelligence. Nowadays, intelligence is considered a multi-faceted concept that cannot be measured comprehensively and accurately by a paper-and-pencil test. Moreover, it is extremely difficult to isolate a multitude of other factors and attribute any result exclusively to intelligence; e.g., parental upbringing, socio-economic levels, health, spiritual beliefs, personal inclinations, etc. Into this mix Peterson adds conscientiousness, with the same problems of how to define and how to measure. So such studies would be subjective, and at best any experimental designs would provide correlational statistics. Even resorting to multivariate analyses would not be without problems.

Multivariate analyses are an aid to, not a substitute for critical thinking in the area of data analysis. Meaningful results can only be produced by these methods if careful consideration is given to questions of sample size, variable type, variable distribution etc., and accusations of subjectivity in interpretation can only be overcome by replication…. Perhaps a major cause of the continuing misuse of statistical methods is the insistence of many journal editors in psychology and related areas, on articles being laced with multivariate analyses, and on encouraging the pedantic use of signifance levels, i.e. the inevitable p less than minus, as if such inclusions lent an air of respectability to their journal which it might not otherwise have had…2

In addition, the argument on IQ tests and the role of conscientiousness in “success” and “happiness” is a mined territory because covertly it recalls the dark side of eugenics. If IQs and conscientiousness are the litmus tests for the rank and suitability of individuals in a given society, then how far are we from doctrines adopted by fascist states vis-à-vis their people? The argument becomes seriously explosive in the context of poverty, depending on how one construes the correlation between IQ and success. For instance, according to many sources, Americans living under the poverty line are over 40 million. A question: would Peterson be poised to say that their poverty is a direct function of their IQ and conscientiousness? Any one who dares to pose the question on IQ or conscientiousness must (1) examine their own shortcoming on both matters, and (2) examine the social, economic, and cultural factors conducive, functionally, to lower IQ and social adaptations. Caveat: examining is not a judgement but a process leading to assumptions that must be further tested for factual or theoretical validity.

Equal Pay for Equal Work

Although physicists can unravel the mathematical laws of the universe and rocket engineers can calculate how to launch several probes on missions throughout the solar system, according to Peterson, humans are incapable of determining what is equal. “The introduction of the ‘equal pay for equal work’ argument immediately complicates even salary comparison beyond practicality for one simple reason: who decides what work is equal? It’s not possible. That’s why the marketplace exists.” (loc 5403) And just how fair or effective as a distributive mechanism is the marketplace?

First, since the dawn of time, world societies and their economic systems have varied from Babylonia, Pharaonic civilization, ancient China, Rome, Islamic civilization, aggressive Mongolian expansionism, etc through to modern systems such as capitalism, socialism, communism, Italian fascism, social democracies, etc. Equal pay for all or advocating for equality of pay to all never existed. Roman soldiers took less that centurions, and engineers and artists took more than qualified labor and artisans. Early Islamic social laws, as distinct from religious laws, had legislated that qualified artisans and poets receive special pecuniary treatment, so also that the fighters that took less than their commanders did. Karl Marx, Fredrick Engels, and even Vladimir Lenin never advocated for equal pay because they acknowledged the important role of creativity and expertise in the making of a valid economic model.

Why does Peterson accept decision of payment being left to the marketplace regardless of equality for the work done? Is the marketplace an entity that popped into existence by itself? Or did it have human hands behind its creation? Of course humans brought about the formation of the marketplace. And which humans would be expected to benefit the most from such an entity? Or did he expect his readers to absorb his statement naively and leave it unchallenged? To make the point, is there a design behind Peterson’s many groundless assertions? In the end, it seems to me that Peterson’s phrase — “That’s why the marketplace exists” — is a poor ideological construct in terms of cause and consequence. Most likely, he came up with it to close a complex argument by pointing to the predictive power of personality characteristics, however, it does not develop as a compact sequential argument. And why should having a extroverted versus introverted personality, or an assertive versus relaxed demeanor demand differential pay for equal work? Peterson provides such as explanations for unequal pay for the same work; to be fair, he does not say such should be the case. But by leaving it up to the market to determine, Peterson by default chooses the status quo wealth and income allocation.

Second, Peterson is positing that the markets can better provide for fairness in remuneration. However, the grotesque inequality that exists in the world clearly adduces that Peterson is dead wrong.3 Does Peterson agree with a market that pays a CEO in a day what a company worker makes in a year? Remarkably, a system within which such unfairness and such inequality do exist is well known: it is called capitalism. Recently, a study has revealed that 26 persons own as much as 3.8 billion of the poorest people. How has this happened? What’s Peterson theory on the matter?

Yet Peterson writes, “Don’t blame capitalism, the radical left, or the iniquity of your enemies. Don’t reorganize the state until you have ordered your own experience. Have some humility. If you cannot bring peace to your household, how dare you try to rule a city?” (loc 2926)

And what if a person’s experience is unordered because of the mayhem of the state? What if the state is wreaking havoc with households? Did not the American Revolution occur because Great Britain was wreaking havoc with colonial households through unfair taxation? Does poverty not wreak havoc on households? By taking over a city, people may be able to implement a system and policies that bring about equality and peace. By equality, I mean equal opportunity to all people, with remuneration based on effort and sacrifice — although Peterson will throw up his arms and say something like we don’t know how to measure effort and sacrifice. But we will never know how to measure effort and sacrifice to Peterson’s pleasure until we start trying; because to leave things the way they are, to the caprice of the market, is just intellectual cowardice. We can be sure, however, that the marketplace itself does not know how to remunerate workers equitably for work done.

Peterson’s Rule 6 is: “Set your house in perfect order before you criticize the world.”

However, there are myriad personality, societal, and worldly factors (greed, sexism, racism, nationalism, war, etc) that work against setting up “perfect” order in one’s house. And what exactly is meant by “perfect” order, and is it even achievable? Perfection is an elusive, and probably unattainable, goal. Therefore, if perfection is unachievable, what Peterson in essence is telling us is tough luck, keep plugging away at trying to reach perfection, and in the meanwhile accept the world the way it is — however imperfect that may be.

If not the marketplace, then who decides what is equal pay for equal work? Of course we decide. We pool our brain power to determine criteria as to what is fair remuneration; afterwards we refine and tweak as is necessary. This is infinitely more sensible than sitting our collective butts and allowing the marketplace of fetid capitalism to lather the masses with inequity and penury.

Peterson opines:

We are not equal in ability or outcome, and never will be. A very small number of people produce much of everything. The winners don’t take all but they take the most, and the bottom is not a good place to be. People get sick there, and remain unknown and unloved. They waste their lives there. (loc 1784)

“We” (a pronoun used often by Peterson) are all different, certainly in many, many ways. We have different predilections, different desires, and different levels of skills. I avoid stating “different abilities” because abilities can be developed to higher levels through proper training and sheer hard work. Not every person is interested or inclined to sharpen their skills in certain endeavors to exhibit a high level of ability.

Granted we are not equal; everyone is superseded by someone else in some facet. Besides, being ranked number one is often subjective and usually ephemeral.

And I disagree emphatically with Peterson; it is the workers that produce most of what the public consumes. Managers and executives supervise and issue orders but produce little by way of physical work — and perhaps much of the intellectual effort comes from workers. In fact, many of the bourgeoisie may be considered leeches on the working class.

Peterson acknowledges the greed of the “winners.” However, I would not construe a group of humans who selfishly grab an inordinate lion’s share for themselves as “winners” while relegating the rest to a sick, unloved ignominy — quite the contrary.

Why does Peterson prioritize production as deciding distribution of wealth by the marketplace? Is production the end-all and be-all of humans? Does it supersede human attributes such as love, empathy, caring, and sharing?

Peterson is advocating dog-eat-dog capitalism. Fuck the market! It all boils down to what kind of world we want. How do we want our societies to look like? Our societies are a mirror unto who we are, unto our our sense of morality. Do we want and accept a society, as Peterson describes, composed of winners and losers? Do we accept joblessness despite the unemployed being desperate for work? Do we accept homelessness, the hungry, shanty towns, hygienic conditions, etc for any among us? Do any of us feel comfortable walking past someone obviously down-and-out?

Do we desire a society free from the ills that define a sick society?

Or do we roll the dice for each person and let the dice (i.e., the market) decide our happenstance?

Because in a sane and morally centered universe, the most meaningful abilities are the ones whereby we can provide warmth, succor, dignity, compassion, and love to our fellow humans.

Dominance is abhorrent. Enlightened thinkers are well aware of that. Hierarchies, excessive self-indulgence, and profligacy are not to be admired. If a permanent hierarchy, then love and altruism must situate at the pinnacle of the human hierarchy. Even primates have evolved altruistic behaviors.

What does it mean have abilities and only use them for self-serving reasons? What purpose, besides self-love and egoism, does it serve to sit on top of some hierarchy (other than a hierarchy dominated by altruism, love, and goodwill)? When Albert Einstein reached the pinnacle of fame as a physicist, did he preen and become self-important? No, Einstein remains a beloved scientist because he loved his fellow humans. Naturally, Einstein was a socialist.

Importantly, the world would be a better place without inequality. A recent book by Richard Wilkinson and Kate Pickett, The Inner Level: How More Equal Societies Reduce Stress, Restore Sanity and Improve Everyone’s Well-being,4 is a British empirical study that hearkens back to Karl Polanyi’s The Great Transformation that told of an age where equality and cooperation were the norm in society. A review of The Inner Level relates “how more equal societies reduce stress and improve wellbeing” for all of us.

The Monster Mao? China’s “one-child policy” and Cultural Revolution

Mao Zedong in Dandong, China 🄯 Photo by Kim Petersen

Peterson also takes potshots at Chinese communism, especially targeting Mao Zedong for vitriol. He employs wording designed to evoke the ire of the reader: “horrors,” “inferno,” “genocides,” “monster,” “totalitarians.”

“… the bottomless horrors of Hitler, Stain, and Mao.” (loc 2100)

“… the inferno of Stalinist Russia and Mao’s China…” (loc 3911) The wording of this sentence, however, points at the countries that Stalin and Mao live in rather than directly at the personnage.

“… the genocides of Stalin and the even greater monster Mao.” (loc 3947)

Peterson joins chairman Mao and the Cultural Revolution with China’s one-child policy: “… the horrors of Mao’s Cultural Revolution and its one-child policy.” (loc 5059)

Peterson is speaking loosely (although Peterson is emphatic about the importance of his words5 ) and inaccurately. First, the one-child policy was implemented in China in 1979. Mao Zedong died on 9 September 1976. During his life Mao was a mixed bag on child birth; initially he encouraged large families, but later he saw family planning as more important. It was in 1979 that the one-child policy was enacted under chairman Deng Xiaoping. Second, the one-child policy is not to be understood as an absolute. It applied particularly to the majority Han and especially in urban centers. Minorities and rural Chinese were not stringently regulated under this policy. Third, China had a rapidly growing population at the time the policy was enacted. China’s population has since reached 1.4 billion people. Some estimates say the policy resulted in 400 million fewer Chinese today. What would the population of China look like today without the one-child policy? And what demands would such a huge population pose for the environment, species extinction, quality of life, employment, and several other factors? Consider to what extent the one-child policy has had on curbing population growth and the fact that China today is the world’s largest economy slated to eliminate poverty in 2020.

As for the “monster Mao” a book review of Was Mao Really a Monster? wrote:

The continued attacks by anti-Communist academics and authors on the reputation and standing of Mao Zedong continue unabated. Indeed, they will last as long as there is a bourgeois class trying to prevent socialist revolution, or having failed to prevent it, trying to undermine it in order to restore capitalism.

Peterson points specifically to “Mao’s murderous Cultural Revolution.” (loc 5434)

Dongping Han, a history and political science teacher at Warren Wilson College in North Carolina, wrote a book that presents a different take on China’s Cultural Revolution than that of the western narrative which portrays great tumult across China, targeting intellectuals for re-education, and rampaging hordes committing violence. There were horrible excesses that occurred. Chinese know well of this, and several Chinese films chronicle the mayhem of the Cultural Revolution. But there were also important improvements in Chinese society. Focusing on Jimu, a rural area in Shandong province, Han details improved living conditions, democracy, health and education, infrastructure, and agricultural practices during this time.6

Furthermore, the Cultural Revolution as some westerners allege did not impact negatively China’s economic growth.7

Nonetheless, the Cultural Revolution, as well as the Great Leap Forward, must be seen, in many respects, as colossal blunders — blunders that cost the lives of far too many people and caused much suffering. Mao as the leader is accountable for the mistakes under his leadership. He was misguided; he became a megalomaniac. But Mao’s goals for the Chinese masses were noble, and he still has a great following among Chinese people.

Population Control

Peterson seems to think the more people on the planet, the merrier.

No one in the modern world may without objection express the opinion that existence would be bettered by the absence of Jews, blacks, Muslims, or Englishmen. Why, then, is it virtuous to propose that the planet might be better off, if there were fewer people on it? (loc 5091)

It is a false analogy. Peterson conflates religious identity, skin color, and nationality. Which sane person proposes this?

First, what Peterson’s hypothetical posits is alarming and genocidal, so morally based people do not express such an opinion. What betterment can be had by genocide?

Second, who claims it is “virtuous to propose” having a planet with fewer people? Whether such a proposal is virtuous or not is irrelevant. Relevant is whether managing the number of humans living in a finite ecosystem, such as Earth, would avert future dangers wrought by rampant population growth or even to bring about a betterment of the present human condition and the condition for the other species on the planet.

Third, as Peterson has worded it, what is proposed by others is depopulation, whereas a morally centered proposal would be for a lowering of the number of humans through birth control and not culling specific groups of people. If that is to be achieved through non-coercive means, then objection should be minimal. If through forced compliance, then there must be a logical and moral rationale for such a decision being reached, and it must have been reached through informed and genuine democratic means applied fairly across peoples and not result from a unilateral decision imposed on the entirety of peoples.

Fourth, there are logical and morally based reasons for limiting population growth that can be discussed elsewhere, among them are exacerbating global warming that imperils life on the planet, the scarcity of resources for sharing, extinction of animal life by human incursions into their territories, habitat despoliation by pollution, etc.

China and Communism

Communist China is currently world’s largest economy in terms of purchasing power parity. Many critics deny that China is communist. So what is communism in China? Godfree Roberts lists some important features of the Communist Party of China (CPC).

1. The Party’s Genesis. It was founded by Mao and others because Chinese governance needed a new look after the old one had apparently failed. In fact, it wasn’t that Confucian government had failed: it was because Chinese officials and the Emperor forgot Confucius’ instructions. So Mao called his revolution ‘communist’ even though Confucius’ teaching was much more radical than any written by Marx: The Common Good: Chinese and American Perspectives.

2. Membership qualifications. They must swear to serve the people first and enjoy the fruits of their service last.

3. Membership behavior. Most of the 90,000,000 Party members do, in fact, serve the people first and enjoy the fruits of their service last. That’s a lot of unselfish people and, when they act together, they can influence the whole country.

4. Party power. They use their power democratically and have dismissed several heads of State since 1950. They do not tolerate underperforming leaders as we do.

5. Leadership behavior. You can see that the Party’s leaders and theoreticians are substituting Confucian terminology for Marxist language. China is retiring to the Confucian roots it never left–only this time the Party is interpreting Confucius’ doctrine of compassion radically.

Roberts concludes by quipping, “Marx would be delighted.”

I will quibble with the conclusion of Roberts on point 5. Confucianism still has influence. However, CPC general secretary Xi Jinping stated, “In contemporary China upholding the theory of socialism with Chinese characteristics means upholding Marxism in its truest sense.”8 Under Xi’s chairmanship a widespread crackdown on corruption has been ongoing.

In stark contradistinction with neoliberalism, Xi emphasizes public ownership dominance.9 The success of socialism with Chinese characteristics will be determined by measuring the benefits accrued to the Chinese people10 — such as rights to education, employment, health care and care for senior citizens.11 Moreover, the benefits are envisioned as for all the world’s people.12

Xi states China is anti-imperialist, anti-colonialist, and anti-war. The rising dragon has a socialist market economy that strives for peace and universal security. This started with Mao Zedong leading his comrades to overthrow the despised Guomindang and establish communist governance in China.

Conclusion

Most of Peterson’s 12 rules are quite sensible. The rules, per se, are trite, cute, and sprinkled with home-cooked wisdom. My focus was Peterson’s digressions, many of which point to a self-assured intellect whose assertions and arguments often fall short. Peterson’s book 12 Rules for Life became more than just rules. A self-help book became an anti-communist polemic. Capitalism, atrocities wrought and abetted by capitalism, as well as capitalist gulags eluded criticism. Peterson digressed into political economy, history, wealth distribution, dominance hierarchies, gender differences, religion, free speech and censorship, and more. Peterson’s 12 Rules left this reader feeling unsatisfied and underwhelmed. The author needs to explain the deep themes that guide his elaboration and scope of work. Was his intention to grace readers with 12 idyllic rules of life, or was his undisclosed intent to warn us about the “evils of communism” over and above contemplating his rules?

Throughout 12 Rules, Peterson writes about the hardship of living: “Life is suffering. That’s clear. There is no more basic, irrefutable truth.”13 A misleading statement because life must not be viewed through such a parochial prism. Life is ecstasy, rapture, sorrow, pain, anger, jealousy, hate, love, and much more. This all points to Peterson, on certain matters, being a polemicist. He chooses one end of the pole and pronounces; the other pole, or points along the continuum are often, if not outright denied, just marginalized or ignored.

It is often said that money cannot buy happiness, but unmentioned by Peterson is that money can avoid many of the hardships and suffering that life throws at you. Yet, Peterson is too intelligent not to be aware of this. He skips this because his thinking is not about finding solutions but rather to describe the world as he sees it. Nonetheless, the ability to pay rent, put nutritious food on the table, put clothes on one’s back, and afford necessary transportation go a long way to easing hardships in life.

There are examples of communist governments that have eased the hardships of life and brought great improvements to their people. Cuban communism must be singled out for the great strides it has made during and since the Cuban Revolution — despite US sanctions.14 It is only fair to point out the achievements made by the communist government of the Democratic People’s Republic of Korea — despite US sanctions. Another, of course, is the communist government in China.

As Xi often states, China is only in the earliest stages of socialism,15 and communism is to be attained farther down the road.16 The CPC’s goal of ending poverty in China by 2020 is a massive step in the right direction. To the extent that Chinese socialism is successful, especially compared to the status of western capitalist countries, it poses a challenge to the capitalist classes in these countries. Why would the working class accept being relegated to the lower rungs of a society when they see Chinese in the future thriving in a classless China? China may become the template for an economic and social revolution that brings about a fairer distribution of income (something still lacking in China currently) elsewhere. China is an economic colossus whose success should throw light back on Cuba, North Korea, and also the great achievements made by the Bolivarian Revolution in Venezuela.

Despite the bombast of Jordan Peterson and Donald Trump, socialism remains a viable force for change in the world.

  1. Read Part 1, Part 2, Part 3, Part 4, and Part 5.17
  1. Jordan Peterson, 12 Rules for Life: An Antidote for Chaos, (Penguin Random House UK, 2018: loc 5372.
  2. BS Everett, Abstract to Multivariate analysis: the need for data, and other problems, British Journal of Psychiatry. March 1975, 126: 237-40.
  3. See Part 5.
  4. Allen Lane, London 2018.
  5. Peterson’s Rule 10 is: “Be precise in your speech.” Ergo, the words in 12 Rules must be seen as an accurate reflection of Peterson’s thinking: “I’m very, very, very careful with my words”
  6. See Dongping Han, The Unknown Cultural Revolution: Life and Change in a Chinese Village (Routledge, 2001).
  7. See Gwydion Madawc Williams, “Was the Cultural Revolution a success?” Quora, 11 February 2018.
  8. Xi Jinping, On the Governance of China, (Beijing: Foreign Languages Press, 2014): loc 230.
  9. Xi, loc 1275.
  10. Xi, loc 554.
  11. Xi, loc 707.
  12. Xi, loc 947, 4010.
  13. Jordan Peterson, loc 2947. See also locations 191, 335, 1787, 2768, 2909, 2959, 3780, 4048, 4765, and 5737.
  14. See Isaac Saney, Cuba: A Revolution in Motion, (Fernwood Publishing, 2004) and Arnold August, Cuba and Its Neighbours: Democracy in Motion, (Zed Books, 2013). Review.
  15. Xi, loc 352, 1566.
  16. It is anarchism that will bring about communal individuality and reduce inequality. See Alan Ritter, Anarchism: A Theoretical Analysis, (Cambridge University Press, 1980): 76-83. pdf.
  17. Apologies for the delay in getting out part 6, but I was in East Africa without laptop.

Understanding the Red Menace

For anyone who has read or listened to Jordan Peterson, it is obvious that he has an intense dislike of communism. On this subject his reasoning appears very shallow.

Thus the author asserts in his 12 Rules for Life: “Solzhenitsyn’s writing utterly and finally demolished the intellectual credibility of communism, as ideology or society.”1

First, Peterson’s claim that Solzhenitsyn’s writing demolished “the intellectual credibility of communism” is a non-sequitur for one fundamental reason: there is no dialectical validity whatsoever when support for a claim comes from places with similar or identical ideological views. In this case, for an apparently anti-communist thinker such as Peterson to quote another anti-communist thinker such as Solzhenitsyn in support for his thesis is a futile intellectual exercise in the art of persuasion. In terms of analogy consider this: what do you think of American supremacists or ultranationalists who when asked to prove the notion of so-called American exceptionalism, reply by citing what Barack Obama said on the subject?

Pertinently though, in none of his literary and political writings dealing with communist issues had Solzhenitsyn succeeded at demolishing Marxism — the ideological, economic, and philosophical matrix of communism. His ire, however, was directed at Soviet communism. But even here, Solzhenitsyn was mostly critical of the excesses of the Soviet state while never delving into the details of the positive social manifestations of Soviet social structures. In other words, his tight bias against communism was such that he just saw things through the prism of his personal views.

Second, I am not here to defend or denigrate communism; this is not the subject of this article. But from an intellectual viewpoint, if Peterson wants to demolish either Marxism or communism, he should do that by pointing to where Marx went wrong in his over 20 books and papers, or at least show us where Lenin, the founder of the first communist state, erred in his conception of such a state. It seems that he skipped this crucial step entirely, maybe because dealing with the Marxian concept of historical materialism from multiple angles requires special preparation that he was not ready to undertake. Said alternatively, what passages in Das Capital, Theories of Surplus Value, The Holy Family (Marx and Engels), Critique of Hegel’s Philosophy of Right, etc., did Peterson find to be intellectually corrupt enough to demolish communism? Based on the preceding, how is it possible then that Peterson goes straight to the climatic point by giving a verdict without trying to evaluate all philosophical, political, social, or economic debates initiated by Marx?

Furthermore, others might counter that Karl Marx demolished the credibility of capitalism as an ideology that has any place in a morally based society. However, I will not comment on the intellectuality of capitalism. I would not characterize Adam Smith’s Wealth of Nations as intellectually devoid — quite the contrary. Likeliest, what passes for capitalism today would nonplus Smith. Yet Peterson would hold Marx’s Capital and Marx and Friedrich Engels’ Communist Manifesto to be intellectually deficient?

What, in essence, does such a statement reveal? To pronounce on intellectual credibility inescapably means that the person doing the pronouncing considers himself intellectually credible and sufficiently informed of the subject matter. In any case, such a person would be capable of reading Solzhenitsyn’s The Gulag Archipelago; tying it to communist theory, as applied in the Soviet Union and elsewhere; and determining the ineluctable, consequential impact of such an ideology on society.

A subsequent epistemological analysis would speak to the veracity of any conclusion having been reached and also to the intellectual rigor of the individual making such a claim.

The events that are documented in The Gulag Archipelago are not denied or contested. What I contest is that the prison labor camps, as is intimated by Peterson, are a predictable outcome of communism. Either the Gulag was an aberration that appeared in a society striving towards a communist state or it was an inevitable outcome of a state on the path to communism. Many more questions arise: for example, were prison labor camps the norm throughout the history the Soviet Union? Or were they bound, particularly, to the authoritarian rule of Josef Stalin? Does the Gulag system exist in other communist states? Does the Gulag system exist in capitalist states?

It is important to understand what is a Gulag. Writing in a forum — which Peterson touts — Konstantin Zhiltsov (whose profile identifies him with a LLB from Moscow State University) wrote: “GULag was a simple administration, not much different from US Federal Bureau of Prisons.”2 Specific to camps, as opposed to locked-in penitentiaries, Zhiltsov wrote that they “existed long before communists and will exist without them just as well.”

On the question of camps:

Do they exist in modern Russia? Of course, yes. The majority of prisoners serve their sentence there. Of course, the regime is much different from Soviet times, much more lenient (that depends on security level, though). For example, prisoner’s labour is a right and not a duty (in the GULag system of camps, for example, it was mandatory, nowadays prisoners decide themselves to work or not to work).

So, the form is the same, but the “soul” inside of them is much different.3

Penitentiaries, rightly or wrongly, exist in most nation states. And forced labor camps are found in the US. It is via the US that in communist Cuba, the most notorious Gulag continues. Irene Khan, Amnesty’s general secretary, described the United States’ incarceration facility at Guantánamo Bay (de facto US-occupied territory in Cuba) as “the gulag of our time.”

Did the fact that Solzhenitsyn criticized the Gulag in the Soviet Union confer his approval of capitalism in the West? Political analyst Radha Rajan wrote, “Solzhenitsyn was as critical of what America and Europe represented in the twentieth century as he was of the Soviet Union and Stalinist repression.”4

Does this point to a bias ingrained in Peterson’s thinking? Nowhere in 12 Rules did Peterson mention, for example, that “Noam Chomsky’s writing utterly and finally demolished the intellectual credibility of capitalism, as ideology or society.”5

What happened to the Soviet Union immediately after the fall of communism? Has capitalism burnished its credibility?

If communism is not defined by the Gulag system, then what is it? What is this communism that Peterson despises?

The Real News editor-in-chief Paul Jay spoke with Alexander Buzgalin, a professor of political economy and the director of the Center for Modern Marxist Studies at Moscow State University. Buzgalin has lived under communism in the Soviet Union and in post-communist Russia. Thus, he is uniquely positioned to comment on what communism is and was.

PAUL JAY: So, for an American or Western audience, that word, “communism,” has- less and less now, the further we get away from the cold war- but still, the idea of communism, socialism, particularly communism, it means “police state.” It means “tyranny.” For most American ears, they can’t understand how someone would actually hope for communism. What did that mean for your family?

ALEXANDER BUZGALIN: For us, it was absolutely another meaning because of literature, because of movies, because of some practical communal-associated activity. So, what was communism for us? First of all, labor is pleasure. I am glad, I am happy to have my work. I am going for the work because I like it, not because I must make as small as possible and receive as much money as possible. Another motivation, another logic. Second, at the workplace we have comrades, not competitors, and together we will do something interesting. This is communism. Communism is space where you have beautiful things; useful, beautiful, cheap things around you. Dress, furniture, everything. And these things are just, I don’t know, basis for your life, for interesting life, for communications, creativity. That was the image of communism. And if you read books of Strugatsky, Arkady Strugatsky or Boris Strugatsky, two very famous writers, you will find a very beautiful description of such a world, and some elements of this world, we had sometimes.

PAUL JAY: Like when?

ALEXANDER BUZGALIN: Like when we were together as schoolboys and schoolgirls, we were making something good for Vietnamese kids. We were spending our free time, not to play games with computers, it was no computer or football- we were playing football, but not all the time. But it was interesting to work and to buy bicycles for Vietnamese kids together. Just one example. To help to the elder people together. To create museum with memory about victims of World War II in school, from the fortress of our parents and grandparents, and so on.

So, one example. And an example in university, we have a union of young students and young scientists, scholars. And we made ourselves with state finance, three, four conferences every year for free in different cities of Russia. We were travelling, we were inviting students from other cities and state paid for their trips, for airplanes, for hotels, for us to go to other places. And it was self-organization. We organized these conferences by ourselves. We had a scientific supervisor, but he or she was controlling the program, nothing else.

PAUL JAY: But this vision, I mean, communism, the Marxist vision, a classless society with very little government, if any, as the ideal. But the reality of life was quite the opposite.

ALEXANDER BUZGALIN: Yes, but not one hundred percent opposite.6

*****
Peterson continues his criticism of communism: “No educated person dared defend that ideology again after [Aleksandr] Solzhenitsyn published The Gulag Archipelago. No one could ever say again, ‘What Stalin did, that was not true communism.’” (loc 3845)7

Peterson attempts to support his contention by ad hominem against those who disagree. Peterson limits the parameters of debate: one must agree that Stalin’s governance was true communism. Moreover, according to Peterson, one must not defend communism or he will be counted among the uneducated. Once again, Peterson relies strongly on Solzhenitsyn to shoot down the entirety of communism:

Solzhenitsyn documented the Soviet Union’s extensive mistreatment of political prisoners, its corrupt legal system, and its mass murders, and showed in painstaking detail how these were not aberrations but direct expressions of the underlying communist philosophy. No one could stand up for communism after The Gulag Archipelago–not even the communists themselves. (loc 5314)

This comes across as pure bluster. Peterson seems to think that by citing a book he can draw a definitive conclusion. Moreover, even given that the events as described by Solzhenitsyn are unerringly accurate, this does not inextricably bind communism to the Gulag because the Gulag happened under nominal or experimental communism. Now whether that communism was as propounded by Marx is debatable. Marx’s communism was about the liberation of workers. The communism of Marx differs from that put into practice by Lenin and Stalin.8 Moreover, communism was not envisioned as a perfect theory, free from need for revision, to be applied to all societies in all situations. Unless Marx considered himself to embody perfection, then he would not construe his thought as free from error. Indeed, self-criticism is a key component of Marxism. As Marxists are aware: “The use of criticism-self-criticism is widely recognized in the Marxist-Leninist movement as a tool that is vital to improving our work.”9 Thus, just as different countries practice a particular form of capitalism construed to meet the needs of their societies (or, more accurately, to meet the needs of the elitists in society), communism has been adapted to the exigencies of time and location.

Peterson points to the Gulag system as the distinguishing feature of communism. The gulags existed, and as horrific and wicked such places were for so many people, they were an outcome of people in power with out-sized egos and blackened souls.

If the Gulag is not the distinguishing feature of communism, then what is? Marx and Engels in the Communist Manifesto stated: “The distinguishing feature of Communism is … the abolition of bourgeois property.”

Peterson commits the logical fallacy of cum hoc ergo propter hoc scenario. Because of communism, there are gulags. What is wrong with such a postulation? Did prisons and torture not exist under the Czarist regimes? Do gulags not exist under capitalism? To institute an analogy, did it occur to Peterson that United States gave torture a meaning worse than that used in the former USSR? Could Peterson educate us about “the Gulag Abu Ghraib,” “the Gulag Guantanamo Bay” or “the Gulag Bagram”?

Also, Peterson should realize that a state does not become a full-fledged communist state overnight, and in the Soviet case, not without fierce resistance. Capitalist powers were not inclined to permit a challenge to their preferred economic order.

Michael Sayers and Albert Kahn wrote that by the summer of 1919, 14 western nations and their client states had invaded Bolshevik Russia.10 US Senator William Edgar Borah admitted at that time that the US was at “war with Russia, while Congress has not declared war.… It is a violation of the plain principles of free government.”11

For the next two and a half decades “the anti-democratic and anti-Soviet conspiracy.… kept the world in an incessant turmoil of secret diplomacy, counterrevolutionary intrigue, terror, fear and hatred, and which culminated inevitably in the Axis war to enslave humanity.”12

Peterson writes,

Communism, in particular, was attractive not so much to oppressed workers, its hypothetical beneficiaries, but to intellectuals—to those whose arrogant pride in intellect assured them they were always right. But the promised utopia never emerged. (loc 3909)

This passage by Peterson is not only the epitome of intellectual manipulation because of how it was phrased, but it is also a demonstration that Peterson has no clues regarding the core tenets of Marxism — specifically Marx’s concept of communism.

On the side of manipulation, Peterson clearly implies that communism is no more than an intellectual product that oppressed workers could not possibly relate to or understand. In addition, he seems to be annoyed — better yet, intimidated — by certain intellectuals whom he debits to the arrogance for feeling “always right.” In psychological terms, clinical psychologist Jordan Peterson appears to acknowledge that he is short on deploying the necessary intellectual tools to counter the arguments of well-informed intellectuals. This impression is enforced by noting that he resorted to name-calling in the attempt to downgrade the competence of intellectuals on the subject while upgrading his own, which is obviously ridden with serious shortcomings.

On the side of Marxian tenets, the scope of communism is not as he erroneously painted it. Marx never thought of communism as a platform solely directed to workers. What he envisioned was for the working class and intellectual pioneers to lead the struggle to abolish the class system thus creating egalitarian societies without classes, exploitation, and discrimination.

Now let’s turn to the debate on the issue of “credibility.” Obviously Peterson must be referring to intellectuals without credibility, but some might argue that such a premise is a contradiction. This forces one to wonder how well Peterson understands the communism of Karl Marx. Peterson does not define the “promised utopia.” Marx and Engels wrote of an end to the struggle between proletariat and bourgeoisie. At which time the “purely Utopian character” would be revealed by “such as the abolition of the distinction between town and country, of the family, of the carrying on of industries for the account of private individuals, and of the wage system, the proclamation of social harmony, the conversion of the function of the state into a more superintendence of production.”13

Peterson’s second contradiction is acknowledging that workers are oppressed while also arguing that oppressed workers are not attracted to a system to end their exploitation. In other words, one surmises from Peterson that workers would prefer to be exploited by a capitalist class. Or Peterson considers that workers are not exploited under capitalism? But no one could be that deluded.

Marx and Engels shot down the notion of worker acquiescence to the capitalist structure: “But does wage-labour create any property for the labourer? Not a bot. It creates capital, i.e., that kind of property which exploits wage-labour, and which cannot increase except upon condition of begetting a new supply of wage-labour for fresh exploitation.”14

Moreover, utopia, if ever promised, was never promised overnight. As long as communist countries were surrounded by opposing capitalist countries, the class struggle remained ongoing.

Communism, in name, was brought about through revolution. Hated regimes like Batista in Cuba, the Czars in Russia, and the Guomindang in China were capitalist or feudalistic in orientation.

Peterson seems eager to criticize and excoriate communist states, yet in his book his home country, Canada, emerges relatively unscathed. Peterson rightly denounces Nazi atrocities committed against Jews, although he does not condemn Nazi atrocities against communists, Roma, homosexuals. Now let’s consider Canada. It is a capitalist state established through genocide against the Original Peoples. Why no criticism by Peterson?15

One shouldn’t just read Chomsky, Solzhenitsyn, Marx, and Adam Smith to get a handle on capitalism versus communism and socialism. In particular, one should not solely rely on the clinical psychologist Peterson to get an understanding in political-economics and associated ideologies. However, one should be open to learning from other political-economic systems, especially adding anarchism to one’s reading list. Become well informed. Devour information with open-minded skepticism and form your own conclusions. Above all, don’t unquestioningly accept ex cathedra statements from professors, politicians, intellectuals, or non-intellectuals.

  1. Read Part 1, Part 2, and Part 3.
  2. In Part 5: understanding the Soviet Union and the fallibility of capitalism
  1. Jordan B. Peterson, 12 Rules for Life, (Penguin Random House UK, 2018): loc 2879.
  2. Konstantin Zhiltsov, “Do Gulags still exist in Russia?” Quora, 26 December 2017.
  3. Konstantin Zhiltsov, “Do Gulags still exist in Russia?” Quora, 26 December 2017.
  4. Radha Rajan, “Russian nationalism through the eyes of an Indian nationalist – 1,” Vijayvaani.com, 28 November 2018.
  5. Chomsky’s focus is not the intellectual credibility of capitalism but the morality of an economic system that leaves behind so many in society. See, e.g., Noam Chomsky, Profit Over People: Neoliberalism and Global Order (Seven Stories Press, 1999).
  6. Growing Up in the USSR – RAI with A. Buzgalin (1/12),” The Real News, 11 July 2018.
  7. Later Peterson’s repeats “The Gulag Archipelago … utterly demolished communism’s moral credibility…” (loc 5307).
  8. See Thomas G. West, “Marx and Lenin,” in Marx and the Gulag (Claremont Paper No. 8, 1987).
  9. Workers Congress (Marxist-Leninist) and Friends from the East Coast, “Open Letter on Criticism-Self-Criticism,” in The Communist, Vol. IV, No. 12, 11 September 1978. Available online at marxists.org.
  10. Michael Sayers and Albert Kahn, The Great Conspiracy: The Secret War Against Soviet Russia Proletarian Publishers (Little, Brown and Company, 1946): 79.
  11. Michael Sayers and Albert Kahn, 85.
  12. Michael Sayers and Albert Kahn, 392.
  13. Karl Marx and Friedrich Engels, “Chapter III. Socialist and Communist Literature” in Karl Marx: Selected Writings.
  14. Karl Marx and Friedrich Engels, Communist Manifesto in Karl Marx: Selected Writings (London: Essential Thinkers, 2004): 39.
  15. The professor Noam Chomsky proffered a moralistic guideline that people should focus on the actions of their own states: “My own concern is primarily the terror and violence carried out by my own state, for two reasons. For one thing, because it happens to be the larger component of international violence. But also for a much more important reason than that; namely, I can do something about it. So even if the U.S. was responsible for 2 percent of the violence in the world instead of the majority of it, it would be that 2 percent I would be primarily responsible for. And that is a simple ethical judgment. That is, the ethical value of one’s actions depends on their anticipated and predictable consequences.” See Noam Chomsky, On Power and Ideology: The Managua Lectures (South End Press, 1987).

The Chinese Dream of Hegemony?

On 30 May, United States Admiral Harry Harris, slated to become the next US ambassador to South Korea, said: “China remains our biggest long-term challenge. Without focused involvement and engagement by the United States and our allies and partners China will realize its dream of hegemony in Asia.”

This is starkly at odds with how Chinese leaders describe the Chinese Dream. Chinese chairman Xi Jinping explained:

… the Chinese Dream of the rejuvenation of the Chinese nation means that we will make China prosperous and strong, rejuvenate the nation, and bring happiness to the Chinese people.1

Xi averred that it is through the cause of Chinese socialism – whose core vales are prosperity, democracy, civility, harmony, freedom, equality, justice, the rule of law, patriotism, dedication, integrity and friendliness – that the Chinese Dream will be attained.1

And the Chinese Dream is not exclusively for the benefit of Chinese people. Xi spoke of cooperation with other countries “on the path to realizing the great dream of development and prosperity.”1

To realize the Chinese Dream… We will both on China’s development and on our responsibilities and contributions to the world as a whole. We will bring benefits to the Chinese people and the rest of the world. The realization of the Chinese Dream will bring the world peace, not turmoil, opportunities, not threats.1

Admiral Harris presents a strictly militarist perspective. This is the perspective of a person who views the world in Manichean terms: ally or enemy.

That China is participating in the capitalist market-economy and performing far more spectacularly than the US is no reason to call China a hegemonic aspirant.2

Yet Harris’ opinions came on the heels of US warships entering the waters around Chinese-claimed territory in the South China Sea.3

The US frequently sends its warships through the region on so-called freedom of navigation patrols, and when the navigation steers provocatively near to islands/islets claimed by China, it causes consternation in Beijing. China abides by freedom of passage through the South China Sea, but as UNCLOS states such passage must be innocent. This should be understandable in Washington because it seems certain how the US would react to Chinese warships sailing through the Straits of Florida.4

Chinese Foreign Ministry spokeswoman Hua Chunying said admiral Harris was “obsessed with hegemony,” fearful that others might try to usurp it from the US.

In his book, The Governance of China, chairman Xi Jinping seven times mentions the Chinese aversion to hegemony. Among them:

We stand for peaceful resolution of all disputes, oppose all forms of hegemony and power politics, and never seek hegemonism nor engage in expansion. (location 594)

China has stood up. It will never again be bullied by any nation. Yet it will never follow in the footsteps of big powers, which seek hegemony once they grow strong. Our country is following a path of peaceful development. (loc 2675)

And we have made a solemn pledge to the whole world that we will never seek hegemony or commit any act of expansion… (loc 3664)

China does not subscribe to the outdated logic that a country will invariably seek hegemony when it grows strong. Are colonialism and hegemony viable today? Absolutely not. (loc 3956)

China would stick to a path of peaceable development, a mutually beneficial strategy and opening up, and the pledge of never seeking hegemony. China would pass its commitment from generation to generation. (loc 6490)

Given the words of the to-be US ambassador to South Korea, one can only assume that the Harris is either ignorant or he is implying that Xi is a liar. Hardly an auspicious start for a job posting that obviously calls for diplomatic skills.

Even if there is substance to what Harris states, it would at best be a case of the pot calling the kettle black.

Does China have the equivalent of a Monroe Doctrine (by which the US has granted itself preeminence — also referred to as hegemony — in the western hemisphere)? Are Chinese troops warring in Africa? Is China supporting a coup government in Honduras? Is China pursuing “regime change” in Venezuela? In Syria? Is China supporting the oppression and slaughter of Palestinians by Israeli Jews? Does Xi Jinping threaten North Korea with genocide? Has China ringed countries around the world with Chinese military bases?

If China does not engage in such imperialistic acts, then who is actually acting a like a hegemon?

Image from
The Daily Economist

  1. Xi Jinping, “The Chinese Dream” in The Governance of China (Beijing: Foreign Languages Press, 2014).
  2. I already addressed the topic of China as a hegemon, but Harris’ comments call for reply.
  3. Curtis Stone, “Washington provokes Beijing in the South China Sea at its own peril,” People.cn, 28 May 2018.
  4. For elaboration on the situation in the South China Sea, read “Who has Sovereignty in the South China Sea?

Why China will not Back Down from a Trade War

On Tuesday (4/3/2018) the US published a list of Chinese imports, set to be hit with a $50 billion tariff increase. This is the latest in an escalating trade skirmish between the US and China, that could escalate into a war. On Monday (4/2/2018) China implemented a $3 billion tariff hike on several US imports including fruits, pork and steel. This was in response to Trump’s tariffs on Chinese aluminum and steel one month ago. Back then, he was tweeting, “trade wars are good and easy to win,” but now it appears he is getting a dose of his own medicine.

Xi is unlikely to back down since, several facets of the Chinese economy bolster it against the vicissitudes of a possible trade war. First, China has built up its internal economy. China’s “township village enterprises” (TVEs) helped rural incomes rise by 300% between 1989 and 2005, fueling domestic demand. Moreover, China’s internal markets received an unprecedented boost in 2008, when the government launched its $586 billion stimulus plan in response to the financial crisis. China has also maintained record high levels of investment in infrastructure and built a world renown high speed rail system that has greatly reduced transport costs to the interior. Correspondingly, exports as a percentage of GNP have been falling steadily since 2006, and with them reliance on trade with the US.

Second, South-South economic ties have been strengthened by China’s one-belt one road project and Asian Infrastructure Development Bank. Just this January, China invested $2.28 billion in the one-belt countries, and $1 trillion is the target investment for the entire project. Increased south-south trade would substitute for lost trade with the States. Third, China holds $1.2 trillion in US debt, which will not only provide a stream stream of income in the event of a trade war, but will militate against Trump escalating it to the point of a trade war in the first place. And finally, China’s housing guarantee, land guarantee, and constitutional right to a job, imply that as bad as any trade war gets, people will have a roof over their head, and either a job, or a plot of land, from which they can draw sustenance. The same cannot be said for the United States.

There are also at least two facets of the Chinese political system that militate against Xi backing down to Trump’s proto-imperialist aggression. First, although Xi is a member of the ‘elitist’ faction of the CCP, which has among its base urban, coastal entrepreneurs who are likely to prefer taking a short-term loss than see an escalation to an all-out trade war; capital is subordinated to the CCP in the Chinese political system. Two of the three primary means of production (land and capital) are controlled by the state. Real estate developers must obtain use rights for land from local party officials, rather than local party officials needing to obtain campaign funds from real estate developers. The power that the CCP has over Chinese capitalists, while incomplete, is significant. In 2008, real estate developers were compelled to invest in 36 million subsidized housing units to counteract rising urban housing prices, which were largely the product of their speculative behavior.

Second, the CCP operates based on the principle of democratic centralism, which stipulates that the minority concede to the majority, once ample debate has been undertaken. This would imply that even if, entrepreneurs opposed a resolute stand against Trump, they would be compelled to accept the dictates of the majority, who presumably would act in their own interests and support strong resistance to Trump’s policies.

It is notable that the legacies of Chinese socialism, are today enabling Chinese state capitalism, to stand resolutely against Trump’s protectionist salvoes. For instance, the 2008 stimulus package that so greatly bolstered China’s internal markets, was made possible by state ownership of the banking sector, which allowed the government to not only inject an unprecedented amount of capital into the Chinese economy, but inject it in the interior regions of China, for the express purpose of building up the domestic market.

Similarly, state banks were instrumental in facilitating the technology transfer necessary for China’s high speed rail system. State lending to “national champions” allowed these champions to leverage their monopsony buying power to force US companies into transferring their technical know-how.

China’s investments in infrastructure were greatly facilitated by the relative abundance of semi-skilled labor (welders, machinists, engineers etc.), themselves a product of the broad based approach taken to education in the Maoist era.

Rural China’s TVEs would not have been possible without state ownership of land, which allowed the state to prevent de-collectivized farmland from being ‘grabbed’ by global agribusiness and turned into vast monocrops which would not have stimulated internal markets in the slightest. TVEs were also, at least in the beginning, state-owned enterprises.

Subordination of the entrepreneurial minority would not be possible without state ownership of two of the three means of production – land and capital, as mentioned above, and of course, China’s various social safety nets: housing guarantee, right to work, land guarantee etc. are a product of the “people’s war.”

China’s socialist legacy is the backbone of its current “sovereign project” – the only such project in existence today. This sovereign project rejects both the dominance of the triad (US, EU, Japan) and the dominance of the neoliberal model propagated by this triad. The power of this triad stems from their control of the five oligopolies of twenty first century capitalism: finance, technology, information, natural resources, and WMDs. The triad’s corporations are disproportionately represented on the top 10 lists of banks, tech companies, media companies, oil companies, and nuclear powers.

International organizations like the WTO have also been regularly biased in favor of the triad. For instance, Trump’s steel tariffs against China were in conflict with existing WTO rules. Trump justified breaking these rules by alleging that China had stolen intellectual property and obtained WTO authorization to implement intellectual property tariffs. The speed with which the WTO protected the intellectual property of 25 US billionaires, and its absolute resistance to protecting the livelihoods of 2.5 billion peasants in the global south who were decimated by the Doha round agreements, reflects the institutional bias of the WTO toward the interests of the triad.

China is making inroads on the five oligopolies of the triad. It is, moreover, presenting an alternative, nationally oriented, state-capitalist model of development, that is fundamentally in conflict with the logic of the dominant neoliberal paradigm. The emerging trade war, is yet another episode in the ongoing battle. China however, seems poised to mount a resolute stand against Trump’s proto-imperialist protectionism. On account of the strength of China’s internal market, the growth of south-south trade, China’s ownership of US debt, and China’s social safety nets, China’s economy looks ready to withstand the shock of a trade war. Its political system moreover, due to the subordination of capital, and the principle of democratic centralism, seems poised to nip elite co-optation in the bud. These bulwarks are in large part, the result of China’s socialist legacy.

Is China Neoliberal?

On 2 March, the Real News interviewed Steve Cohn, author of Competing Economic Paradigms in China (Routledge, 2017). Host Sharmini Peries began by asking:

Professor Cohn, in your book you analyze the transition of the Chinese economy from Maoist to ‘iron rice bowl’ policy to a neoliberal policy. What kind of domestic factors contributed to this transition?

Part of Cohn’s response was:

I think the Chinese government, starting with Deng Xiaoping but has continued since then, came to the conclusion that certain capitalist-oriented policies were necessary to increase the social surplus under the state’s control and also to prevent China from falling behind technologically. These leaders, I think, felt that neoclassical economics was a reliable theory that would facilitate this project of adopting some capitalist techniques, and they supported it very aggressively in many ways… [Italics added]

China neoliberal?

The present writer has been living off-and-on in various parts of China since 2003. At first I was skeptical to Socialism with Chinese Characteristics, but I have observed the development in China first-hand along with the diminishment of poverty (as evidenced by the relative scarcity of mendicancy and homelessness).

Neoliberalism

What is neoliberalism? To start, it is not new, and it is not liberal. It is predicated on prioritizing the private sphere over the public sphere; i.e., allowing the so-called free-market to decide. Hence, the role of the government is to be minimized, with privatization, cutting social programs, deregulating finance, and imposing austerity prescribed.

Yet, can one seriously ascribe neoliberalism to China with its state-owned enterprises, state-owned banks, and expanding social programs?

In his book Profit over People: Neoliberalism and Global Order (Seven Stories Press, 1999), distinguished professor Noam Chomsky referred to a World Bank report that China was not following neoliberal dictates; instead China was described as “the most interventionist and price-distorting government of all.”

Chomsky quoted the eminent economic historian Paul Bairoch who stated that “there is no doubt that the third world’s compulsory economic liberalism in the nineteenth century is a major element in explaining the delay in its industrialization.” Given the enviable economic development of China, the Communist Party was evidently correct to eschew neoliberalism and chart its own course.

*****
Host Peries presented another surprising nugget that the US was directing the Chinese economy:

… You write about international or US-based organizations such as the American Economic Association, the Ford Foundation, the World Bank, and other such institutions that the Chinese sort out to influence their economic policy and drive the direction of a capitalist economy that they adopted. The interesting point you make about this is that this influence was invited. Why did the Chinese government officials accept this or want this kind of influence?

Cohn replied,

I don’t think the Chinese even to this day fully realize the extent to which there’s a socialization, as well as an intellectual kind of understanding involved with graduate school.

So I think they underestimated it, that impact on the students and the difficulty of unpacking these ideological and political factors… [Italics added]

Cohn uses terms such as thinks and feels throughout the interview. This conveys an appearance of uncertainty as to what he discusses.

Later Cohn said,

You can see what they’ve [Chinese Communist Party officials] done; you’re not quite sure what they’re thinking. There certainly have been a lot of social problems, environmental problems, inequality in particular, financial fragility, the problem of various debt crises in China. But my suspicion is that the Chinese leaders feel that their strategy has in some important ways to them empowered China. And I think that they probably feel they can deal with problems of environmental and other side effects of this.

What’s interesting in terms of paradigm competition is trajectories… [Italics added]

One Chinese Trajectory: Poverty Elimination

What are the Chinese trajectories? One example should suffice to refute the notion of China as a neoliberal state: China is on target to eliminate poverty. What capitalist country prioritizes such a goal?

A Global Times op-ed argued,

As a socialist country, it would be an agony — if not a disgrace — for the country’s elites to sit idle and not extend a helping hand to the needy.1

Xinhua reported, “China lifted 12.89 million rural people out of poverty in 2017 as it progresses towards its target of eradicating poverty…”2

This poverty elimination is verified by the World Bank which cites 753 million people lifted out of poverty between 1978 and 2010. China is presented as an example for the rest of the world in how to eliminate the scourge of poverty:

The country’s poverty reduction offers lessons for other countries…. Its approach combines combines government leadership and support from all social sectors with farmers playing a major role, and integrates general and special favorable policies, poverty alleviation programs and social safety nets.3 [Italics added]

Tiananmen Square

Particularly noteworthy in the Real News interview were the references to “Tiananmen Square protests” and “the repression following Tiananmen Square.” No mention was made of a Tiananmen Square massacre, as has been a repetitive staple in corporate media reporting.

Wei Ling Chua wrote a compelling exposé on this disinformation, Tiananmen Square “Massacre”? The Power of Words vs. Silent Evidence, which noted the many retractions of what many western journalists had initially reported.4

Missing Background to the Real News Interview

I asked Wei, who also wrote Democracy: What the West Can Learn from China, for his take on the Real News interview. Wei wrote back:

There are too many issues in the video, I would like to have a quick comment on the following:

1. People tend to overlook the fact that it was Mao who lay the foundation for Chinese access to the world that allowed Deng economic integration with the world economy in 1978:

  1. in 1949, China was broken and bankrupt at the time Mao took over;
  2. Due to the Cold War, the Korean War, and the Vietnam war, China was under western economic, financial, technological and banking sanctions; as well as USSR technological sanctions;
  3. despite these adversaries, Mao managed to defeat the US led military coalition in the Korea War; helped the Vietnamese defend itself from US invasion. That made China a world force that the US could not ignore;
  4. Mao managed to make use of the complex relationship between the USSR and US, and woo the US via ping-pong diplomacy, and eventually resulted in Nixon’s visit to China, laying the foundation for China to access the world;>
  5. Mao’s vision of classifying the world into First World (Western nation), 2nd world (USSR), and the Chinese alliance with the 3rd world (Africa, Latin America, Asia etc) eventually paid off after making use of the new relationship with Nixon, and  winning the majority vote in the UN to get the PRC onto the UN security council.
  6. Without all these foundations for China to access the world, there would have been no reforms under Deng.
  7. At the time Deng took over the leadership in China, Mao had already eliminated illiteracy, doubled the life expectancy of the population, armed China with nuclear, rocket and satellite technology, and a lot of basic industries for consumer products. Without all these, there would be no foundation for any further progress to access the world.
  8. So to credit China prosperity solely on Western capitalism is not objective.

2. The author [Cohn] also failed to mention the fact of the Chinese modelling more towards the Singaporean economic model than the west. Despite Singapore being recognised as one of the freest economies in the world, 60% of Singapore’s GDP is generated by the Singaporean government investments; so in China, despite being opened up to international and private funds and investment, the state still controls much of the economy;

3. 30 years after Deng’s reforms, China encountered problems like any western society: income gaps, housing affordability and the growth in GDP v social stress; but it is China who acts on to ratify the issues;

4. [Current Chinese chairman] Xi Jinping only wants the part of market logic to award and motivate people who work hard and be innovative, but dislikes an uncontrolled market economy that allows the wealthy to eventually dictate supply and prices of everything;

5. Unlike the west that privatised everything, Xi not only wants SOEs to become bigger and stronger, he also introduced a policy for the government to pay for and own a 1% share of every registered business in China; the law states that with the 1%, government officials will attend all executive meetings and have the power to stop any decision that is harmful to the country.

Conclusion

For those who aspire to a world not riven by extreme wealth and income inequality, China is a potential antipode to unfettered capitalism. China pursues socialism. The Chinese Communist Party also rejects hegemony and war. Thus China stands forth as an alternative model to aggressive capitalist imperialism. However, it is important that China be considered as to which point it is in its political-economic trajectory. At present, Chinese leaders state that China is in the earliest stages of socialism. Nevertheless, along its trajectory China ought to be fairly scrutinized for adherence to it announced political and social goals.

  • The original source of this article is Asia-Pacific Research.
    1. Li Hong, “Shaking off poverty is an obligation for China,” Global Times, 14 January 2018.
    2. Xinhua, “China brings nearly 13 mln people out of poverty in 2017,” Global Times, 1 February 2018.
    3. Chengwei Huang, “Ending poverty in China: Lessons for other countries and the challenges still ahead,” World Bank, 14 October 2016.
    4. See review.

    China and the US: Comparing Leadership Selection

    The US selection of leaders has virtually nothing to do with democratic processes and outcomes. It is useful to contrast this with the process in China. In most instances, China’s selection of leaders is far more meritocratic, successful and performance-based. In both the US and China, the process lacks transparency.

    US Economic, Political, and Cultural Leadership

    The selection of US economic, political and cultural leaders is based on several undemocratic procedures.

    1. Inheritance via family ties

    2. Personal access to credit and financing

    3. Political patronage

    4. Lobby and elite sale and purchase of office and favors

    5. Media links

    6. Political repression and manipulation of electoral procedures

    7. Incumbency and use of state resources

    8. Ethno-religious nepotism

    9. Internal party hierarchy

    10. Closed party decisions (opacity)

    11. Ability to keep secrets

    Leaders, whether appointed, self-appointed and selected through money, media, elite networks, turn the electoral process into virtual afterthoughts in the US system. US economic leaders have increased the flow from productive profits and investments upward to the financial sector and/or outwardly overseas to tax havens.

    US political leaders have increased military expenditures and wars, diverting public funds from domestic social services and welfare, diminishing domestic economic growth and markets for investment and trade.

    US cultural leaders have been rewarded for defending, promoting and embellishing imperial conquests and denigrating independent nations and leaders. They have also been rewarded for promoting the most degrading and frivolous consumerism, undermining social and community cohesion.

    The lack of transparency in the US selection process of leaders in major investment banks, political parties, legislative and executive offices and academia is growing at an alarming rate and with significant negative consequences: US leaders do not have to pass rigorous exams nor do they face interviews with peers with competence in their fields of work.

    US business leaders are not judged by their economic and political performance. Responsibility for disastrous wars, corrupt bank bailouts, financial crises and skyrocketing health care costs do not disqualify a candidate for leadership positions.

    Documented performance criteria are not the basis for selecting Congressional and Presidential leaders. The decisive factors influencing political selection are the capacity to promote elite interests, pursue imperial wars to gratify the ambitions and greed of civilian militarists and mask widespread corruption to grease the wheels of speculation.

    China: Consultation, Meritocracy and Performance

    Chinese leaders are selected on the basis of multi-level consultation, meritocracy and performance in office.

    China’s recent Party Congress highlighted three areas of vital concern: reducing inequalities, addressing environmental degradation and health care.

    In contrast, last year’s US Congressional elections focused on its pledge to reduce corporate taxes for the super-rich despite the increasing social and economic inequality, removal of state and federal regulation protecting the population and environment from corporate polluters, and reducing public funding for access to competent health care, undermining citizen well-being and exacerbating the rise in premature deaths and decreased life expectancy for the poor and working class.

    The American political elite is full of ‘climate change’ deniers and promoters of the worst kinds of pollution.

    The US Congress spent an enormous amount of time and energy pursuing partisan conspiracies while refusing to address the raging epidemic of prescription narcotic addiction, which has killed over 600,000 Americans in 15 years.

    President Xi Jinping demanded that Chinese leaders direct their efforts to correct the ‘unbalanced and inadequate development and the people’s ever growing needs for a better life’. President Xi emphasized the goal of ‘greening the economy’, mentioning it 15 times in his address to the Party Congress- compared to only once in the previous Party meeting (FT 11/1/17, p 11).

    Chinese public and private investors have responded to health and environmental priorities set by President Xi – stock indexes spiraled in those sectors (FT 11/11/17, p. 11).

    At the top level, leadership engages in consultations and debates among competing elites, discussing past and present outcomes in developing current and future policies.

    At the middle levels, ultra-competitive public service examinations are determinant in the selection and appointment of Chinese officials.

    At the top and middle levels of leadership job performance is one of the leading factors determining selection. The four decades of spectacular economic growth that has lifted 500 million Chinese people out of poverty is a reflection of the effective system for selection and promotion of leaders.

    Maintaining peace and friendship with other countries for over forty years — except for a brief border conflict with Vietnam in 1979– has been a major factor influencing leadership selection. In contrast, despite multiple disastrous and brutal wars, Presidents Clinton, Bush and Obama were re-elected to office in a two-party ‘duopoly’ system universally regarded as ‘rigged’. The effect of these wars on the deterioration of US domestic economy is not reflected in the candidate selection or in the outcome of the presidential or congressional elections.

    China has selected leaders who have demonstrated ability and seriousness in investigating and punishing over one million corrupt public officials and plutocrats. Anti-corruption crime-fighters have been promoted as ‘clean and hardworking’ leaders.

    In contrast, the US Administration has repeatedly appointed Wall Street criminals to senior positions in Treasury, the Federal Reserve and the IMF with disastrous results for the citizenry, with no capacity for analyses or correction.

    One of the most selective and prestigious Party mechanisms is found in the Organization Department (OD) of the Chinese Communist Party (FT 10/30/17, p. 9). The OD meets privately and reviews selections for leadership on the basis of a ‘complex combination of nominations, written and oral exams and investigations, and a majority vote among ministers. Leaders, thus selected, assume collective responsibility – and they do not position themselves by ‘leaking decisions’ (FT ibid).

    Conclusion

    In both the US and China the selection of leaders are not based on elections or consultations with the citizens. However, there are vast differences in the process and procedures of leader selection resulting in vast differences in the outcomes.

    China is largely a meritocracy, with vestiges of family nepotism, especially with reference to some business-state appointments.

    Performance counts a lot, and most citizens credit the leadership of the Chinese Party for China’s long-term, large-scale socio-economic success. In contrast, the vast majority of US citizens are cynical and dissatisfied with top economic appointments because of their documented past and present socio-economic failures. The citizens direct their greatest dismay at the top financial leaders (whom they view as corrupt oligarchs) for plunging our country into repeated crises, perpetual wars, growing inequalities and deep, widespread poverty. The loss of stable, well-paying jobs and the deterioration of community and family cohesion has outraged the citizens because these are in stark contrast with pervasive, deep-seated corruption in high places and almost total judicial impunity for high officials, politicians and oligarchs alike.

    China’s on-going prosecution of corrupt leaders has no counterpart in the US.

    Business-politician bribes are legalized in the US when they are termed ‘campaign financing’ or ‘consultant fees’. One has only to consider the half-million dollar lecture fees paid to the Clintons by grateful Wall Street financiers for their 30 minute recitations of platitudes and influence peddling.

    In the field of foreign policy, China’s leaders defend their national interest. US leaders shamelessly kowtow to Israeli lobbyists, promoting Tel Aviv’s interests.

    Chinese leaders marginalize critics in the name of harmony, stability, peace and growth.

    US leaders marginalize, imprison and brutalize Afro-Americans, immigrants, environmentalists and anti-war activists, as well as Wall Street and government whistle blowers, in the name of free markets and nebulous liberal democratic ‘values’.

    China, with all of its drawbacks in terms of democratic procedures and rights, is moving toward a less corrupt, less bellicose and more accountable dynamic society with carefully vetted and developed leadership.

    The US is moving toward a more corrupt, crime ridden and despotic (‘police state’) society with unaccountable leaders, warmongers and criminal at the helm.

    The gap between promise and performance is widening in the US, while it narrows in China.

    China’s rigorous, meritocratic selection process has demonstrated greater capacity to respond to new challenges and majority needs than the dysfunctional and corrupt US electoral charade, which cannot even address the addiction crisis brought on by unregulated over-prescription of opiates, let alone respond to the environmental crises of climate change and mega-storms ravaging US communities.

    China and the US: Rational Planning and “Lumpen” Capitalism

    US journalists and commentators, politicians and Sinologists spend considerable time and space speculating on the personality of China’s President Xi Jinping and his appointments to the leading bodies of the Chinese government, as if these were the most important aspects of the entire 19th National Congress of the Communist Party of China (October 18-24, 2017).1,2

    Mired down in gossip, idle speculation and petty denigration of its leaders, the Western press has once again failed to take account of the world-historical changes which are currently taking place in China and throughout the world.

    World historical changes, as articulated by Chinese President Xi Jinping, are present in the vision, strategy and program of the Congress. These are based on a rigorous survey of China’s past, present and future accomplishments.

    The serious purpose, projections and the presence of China’s President stand in stark contrast to the chaos, rabble-rousing demagogy and slanders characterizing the multi-billion dollar US Presidential campaign and its shameful aftermath.

    The clarity and coherence of a deep strategic thinker like President Xi Jinping contrasts to the improvised, contradictory and incoherent utterances from the US President and Congress. This is not a matter of mere style but of substantive content.

    We will proceed in the essay by contrasting the context, content and direction of the two political systems.

    China: Strategic Thinking and Positive Outcomes

    China, first and foremost, has established well-defined strategic guidelines that emphasize macro-socio-economic and military priorities over the next five, ten and twenty years.

    China is committed to reducing pollution in all of its manifestations via the transformation of the economy from heavy industry to a high-tech service economy, moving from quantitative to qualitative indicators.

    Secondly, China will increase the relative importance of the domestic market and reduce its dependence on exports. China will increase investments in health, education, public services, pensions and family allowances.

    Thirdly, China plans to invest heavily in ten economic priority sectors. These include computerized machinery, robotics, energy saving vehicles, medical devices, aerospace technology, and maritime and rail transport. It targets three billion (US) dollars to upgrade technology in key industries, including electrical vehicles, energy saving technology, numerical control (digitalization) and several other areas. China plans to increase investment in research and development from .95% to 2% of GDP.

    Moreover, China has already taken steps to launch the ‘petro-Yuan’, and end US global financial dominance.

    China has emerged as the world’s leader in advancing global infrastructure networks with its One Belt One Road (Silk Road) across Eurasia. Chinese-built ports, airports and railroads already connect twenty Chinese cities to Central Asia, West Asia, South-East Asia, Africa and Europe. China has established a multi-lateral Asian Infrastructure Investment Bank (with over 60 member nations) contributing 100 billion dollars for initial financing.

    China has combined its revolution in data collection and analysis with central planning to conquer corruption and improve the efficiency in credit allocation. Beijing’s digital economy is now at the center of the global digital economy. According to one expert, “China is the world leader in payments made by mobile devices”, (11 times the US). One in three of the world’s start-ups, valued at more than $1 billion, take place in China.3 Digital technology has been harnessed to state-owned banks in order to evaluate credit risks and sharply reduce bad debt. This will ensure that financing is creating a new dynamic flexible model combining rational planning with entrepreneurial vigor.3

    As a result, the US/EU-controlled World Bank has lost its centrality in global financing. China is already Germany’s largest trading partner and is on its way to becoming Russia’s leading trade partner and sanctions-busting ally.

    China has widened and expanded its trade missions throughout the globe, replacing the role of the US in Iran, Venezuela and Russia and wherever Washington has imposed belligerent sanctions.

    While China has modernized its military defense programs and increased military spending, almost all of the focus is on ‘home defense’ and protection of maritime trade routes. China has not engaged in a single war in decades.

    China’s system of central planning allows the government to allocate resources to the productive economy and to its high priority sectors. Under President Xi Jinping, China has created an investigation and judicial system leading to the arrest and prosecution of over a million corrupt officials in the public and private sector. High status is no protection from the government’s anti-corruption campaign: Over 150 Central Committee members and billionaire plutocrats have fallen. Equally important, China’s central control over capital flows (outward and inward) allows for the allocation of financial resources to high tech productive sectors while limiting the flight of capital or its diversion into the speculative economy.

    As a result, China’s GNP has been growing between 6.5%-6.9% a year — four times the rate of the EU and three times the US.

    As far as demand is concerned, China is the world’s biggest market and growing. Income is growing — especially for wage and salaried workers. President Xi Jinping has identified social inequalities as a major area to rectify over the next five years.

    The US: Chaos, Retreat and Reaction

    In contrast, the United States President and Congress have not fashioned a strategic vision for the country, least of all one linked to concrete proposals and socio-economic priorities, which might benefit the citizenry.

    The US has 240,000 active and reserve armed forces stationed in 172 countries. China has less than 5,000 in one country – Djibouti. The US stations 40,000 troops in Japan, 23,000 in South Korea, 36,000 in Germany, 8,000 in the UK and over 1,000 in Turkey. What China has is an equivalent number of highly skilled civilian personnel engaged in productive activity around the world. China’s overseas missions and its experts have worked to benefit both global and Chinese economic growth.

    The United States’ open-ended, multiple military conflicts in Afghanistan, Iraq, Syria, Libya, Yemen, Niger, Somalia, Jordan and elsewhere have absorbed and diverted hundreds of billions of dollars away from productive investments in the domestic economy. In only a few cases, military spending has built useful roads and infrastructure, which could be counted a ‘dual use’, but overwhelmingly US military activities abroad have been brutally destructive, as shown by the deliberate dismemberment of Yugoslavia, Iraq and Libya.

    The US lacks the coherence of China’s policy making and strategic leadership. While chaos has been inherent in the politics of the US ‘free market’ financial system, it is especially widespread and dangerous during the Trump regime.

    Congressional Democrats and Republicans, united and divided, actively confront President Trump on every issue no matter how important or petty. Trump improvises and alters his policies by the hour or, at most, by the day. The US possesses a party system where one party officially rules in the Administration with two militarist big business wings.

    US has been spending over 700 billion dollars a year to pursue seven wars and foment ‘regime changes’ or coups d’état on four continents and eight regions over the past two decades. This has only caused disinvestment in the domestic economy with deterioration of critical infrastructure, loss of markets, widespread socioeconomic decline and a reduction of spending on research and development for goods and services.

    The top 500 US corporations invest overseas, mainly to take advantage of low tax region and sources of cheap labor, while shunning American workers and avoiding US taxes. At the same time, these corporations share US technology and markets with the Chinese.

    Today, US capitalism is largely directed by and for financial institutions, which absorb and divert capital from productive investments, generating an unbalanced crisis-prone economy. In contrast, China determines the timing and location of investments as well as bank interest rates, targeting priority investments, especially in advanced high-tech sectors.

    Washington has spent billions on costly and unproductive military-centered infrastructure (military bases, naval ports, air stations etc.) in order to buttress stagnant and corrupt allied regimes. As a result, the US has nothing comparable to China’s hundred-billion-dollar ‘One Belt-One Road’ (Silk Road) infrastructure project linking continents and major regional markets and generating millions of productive jobs.

    The US has broken global linkages with dynamic growth centers. Washington resorts to self-defecating, mindless chauvinistic rhetoric to impose trade policy, while China promotes global networks via joint ventures. China incorporates international supply linkages by securing high tech in the West and low cost labor in the East.

    Big US industrial groups’ earnings and rising stock in construction and aerospace are products of their strong ties with China. Caterpillar, United Technologies 3M and US car companies reported double-digit growth on sales to China.

    In contrast, the Trump regime has allocated (and spent) billions in military procurement to threaten wars against China’s peripheral neighbors and interfere with its maritime commerce.

    US Decline and Media Frenzy

    The retreat and decline of US economic power has driven the mass media into a frenzy of idiotic ad hominem assaults on China’s political leader President Xi Jinping. Among the nose pickers in print, the scribes of the Financial Times take the prize for mindless vitriol. Mercenaries and holy men in Tibet are described as paragons of democracy and ‘victims’ of a …flourishing modernizing Chinese state lacking the ‘western values’ (sic) of floundering Anglo-American warmongers!

    To denigrate China’s system of national planning and its consequential efforts to link its high tech economy with improving the standard of living for the population, the FT journalists castigate President Xi Jinping for the following faults:

    1.) For not being as dedicated a Communist as Mao Zedong or Deng Xiaopeng

    2.) For being too ‘authoritarian’ (or too successful) in his campaign to root out corrupt officials.

    3.) For setting serious long-term goals while confronting and overcoming economic problems by addressing the ‘dangerous’ level of debt.

    While China has broadened its cultural horizon, the Anglo-Saxon global elite increases possibility of nuclear warfare. China’s cultural and economic outreach throughout the world is dismissed by the Financial Times as ‘subversive soft power’. Police-state minds and media in the West see China’s outreach as a plot or conspiracy. Any serious writer, thinker or policymaker who has studied and praised China’s success is dismissed as a dupe or agent of the sly President Xi Jinping. Without substance or reflection, the FT (10/27/17) warns its readers and police officials to be vigilant and avoid being seduced by China’s success stories!

    China’s growing leadership in automobile production is evident in its advance towards dominating the market for electric vehicles. Every major US and EU auto company has ignored the warnings of the Western media ideologues and rushed to form joint ventures with China.

    China has an industrial policy. The US has a war policy. China plans to surpass the US and Germany in artificial intelligence, robotics, semi-conductors and electric vehicles by 2025. And it will — because those are its carefully pronounced scientific and economic priorities.

    Shamelessly and insanely, the US press pursues the expanding stories of raging Hollywood rapists like the powerful movie mogul, Harvey Weinstein, and the hundreds of victims, while ignoring the world historic news of China’s rapid economic advances.

    The US business elites are busy pushing their President and the US Congress to lower taxes for the billionaire elite, while 100 million US citizens remain without health care and register decreased life expectancy! Washington seems committed to in State-planned regression.

    As US bombs fall on Yemen and the American taxpayers finance the giant Israeli concentration camp once known as ‘Palestine’, while China builds systems of roads and rail linking the Himalayas and Central Asia with Europe.

    While Sherlock Holmes applies the science of observation and deduction, the US media and politicians perfect the art of obfuscation and deception.

    In China, scientists and innovators play a central role in producing and increasing goods and services for the burgeoning middle and working class. In the US, the economic elite play the central role in exacerbating inequalities, increasing profits by lowering taxes and transforming the American worker into poorly paid temp-labor – destined to die prematurely of preventable conditions.

    While Chinese President Xi Jinping works in concert with the nation’s best technocrats to subordinate the military to civilian goals, President Trump and his Administration subordinate their economic decisions to a military-industrial-financial-Israeli complex.

    Beijing invests in global networks of scientists, researchers and scholars. The US ‘opposition’ Democrats and disgruntled Republicans work with the giant corporate media (including the respectable Financial Times) to fund and fabricate conspiracies and plots under Trump’s Presidential bed.

    Conclusion

    China fires and prosecutes corrupt officials while supporting innovators. Its economy grows through investments, joint ventures and a great capacity to learn from experience and powerful data collection. The US squanders its domestic resources in pursuing multiple wars, financial speculation and rampant Wall Street corruption.

    China investigates and punishes its corrupt business and public officials while corruption seems to be the primary criteria for election or appointment to high office in the US. The US media worships its tax-dodging billionaires and thinks it can mesmerize the public with a dazzling display of bluster, incompetence and arrogance.

    China directs its planned economy to address domestic priorities. It uses its financial resources to pursue historic global infrastructure programs, which will enhance global partnerships in mutually beneficial projects.

    It is no wonder that China is seen as moving toward the future with great advances while the US is seen as a chaotic frightening threat to world peace and its publicists as willing accomplices.

    China is not without shortcomings in the spheres of political expression and civil rights. Failure to rectify social inequalities and failure to stop the outflow of billions of dollars of illicit wealth, and the unresolved problems with regime corruption will continue to generate class conflicts.

    But the important point to note is the direction China has chosen to take and its capacity and commitment to identify and correct the major problems it faces.

    The US has abdicated its responsibilities. It is unwilling or unable to harness its banks to invest in domestic production to expand the domestic market. It is completely unwilling to identify and purge the manifestly incompetent and to incarcerate the grossly corrupt officials and politicians of both parties and the elites.

    Today overwhelming majorities of US citizens despise, distrust and reject the political elite. Over 70% think that the inane factional political divisions are at their greatest level in over 50 years and have paralyzed the government.

    80% recognize that the Congress is dysfunctional and 86% believe that Washington is dishonest.

    Never has an empire of such limitless power crumbled and declined with so few accomplishments.

    China is a rising economic empire, but it advances through its active engagement in the market of ideas and not through futile wars against successful competitors and adversaries.

    As the US declines, its publicists degenerate.

    The media’s ceaseless denigration of China’s challenges and its accomplishments is a poor substitute for analysis. The flawed political and policy making structures in the US and its incompetent free-market political leaders lacking any strategic vision crumble in contrast to China’s advances.

    1. The 19th National Congress was attended by 2,280 delegates representing 89 million members.
    2. Lumpen Capitalism refers to an economic system in which the financial and military sector exploits the state treasury and productive economy for the 1% of the population.
    3. FT 10/28/17, p. 7.

    Can Capitalists Afford a Trumped Recovery?

    Earlier this week, I hooked up for a lunch with George Archer and Jonathan Nitzan, two friends of mine who also had previous stints working at BCA Research. I enjoyed our lunch and conversation. After we met, Jonathan sent me a paper he published along with Shimshon Bichler, “Can Capitalists Afford a Trumped Recovery?”:

    The presidential election of Donald Trump has rekindled hopes for a U.S. recovery. The new president promises to ‘make America great again’, partly by creating many millions of new jobs for U.S. workers, and judging by the rising stock market, capitalists seem to love his narrative. But if Trump actually delivers on his promise, their attitude is likely to change radically. In our 2016 paper, ‘A CasP Model of the Stock Market’, we developed the concept of a ‘CasP policy cycle’, the idea that government policy, insofar as it caters to the imperative of capitalized power, favours low employment growth in order to enable low rates of interest and sustain the capitalist share of income. If Trump proceeds with and succeeds in reversing this CasP policy cycle, his authoritarianism may end up undermining rather than boosting capitalized power. In this sense, his regime could well mark the beginning of the next major bear market.

    Let me begin by stating this, Jonathan and Shimshon aren’t some Marxist utopian quacks. They fully understand neoclassical economics and its limitations in explaining power structures and what really drives the financial and economic world order. They published a book, Capital as Power, that offers a radical alternative to the conventional theories of capitalism.

    Also, before becoming a professor of political economy at York University, Jonathan worked a few years at BCA Research covering emerging markets with George Archer and Chen Zhao. He knows all about markets and the traditional way of analyzing economies and financial markets.

    But his and Shimshon’s analysis of the economy is far deeper than anything you’re going to read at BCA or any other investment and economic research outfit. And unlike many academics, Shimshon and Jonathan use economic and financial data to create great charts that support their points and to draw inferences on how power structures impact the stock market.

    “Leo, that’s great, but I’m just looking to beat my benchmark so I can make a lot of money at the end of the year. I can’t be bothered reading this intellectual mumbo jumbo, it’s beyond my capacity to grasp. I need actionable ideas which will help me secure a big bonus at the end of the year.”

    Well then, go read nice papers from Morgan Stanley, Goldman Sachs and others, but if you really want to be challenged to think about the world and what really is behind stock market moves, you should invest some time to read these papers, they will open your eyes to another level of thinking about the way capitalism really works and how this impacts employment, rates, inflation and the stock market (at the very least, you will understand why winter is coming on stocks!).

    Are these papers similar to Bridgewater’s “epic” study, Populism: The Phenomenon, put out earlier this year? No, they are much deeper and offer a lot more insights than anything Bridgewater has put out on what exactly is going on right now.

    To be blunt, these are the papers that Ray Dalio and company should be reading to understand how the “economic machine” really works in the world we live in and it’s definitely the type of stuff that George Soros can appreciate, especially in his old age.

    Alright, now that I’ve given you my biased introduction, let’s go over Shimshon Bichler and Jonathan Nitzan’s short paper, “Can Capitalists Afford a Trumped Recovery?” (added emphasis is mine):

    The presidential election of Donald Trump has rekindled hopes for a U.S. recovery. The new president promises to ‘make America great again’, partly by creating many millions of new jobs for U.S. workers, and judging by the rising stock market, capitalists seem to love his narrative. But if Trump actually delivers on his promise, their attitude is likely to change radically.

    1. What if Unemployment Falls and Employment Growth Accelerates?

    First, the capitalist share of domestic income will probably drop precipitously. Figure 1 – an up-to-date version of a chart first published in Nitzan and Bichler (2014a, 2014b) [link] [link] – shows why. The top part of the chart plots the sum of pretax profit and net interest as a share of domestic income on the left scale, along with the unemployment rate three years earlier on the right. The bottom part of the chart shows the annual rates of change of these two series (with all data smoothed as five-year trailing averages; click on image).


    The historical facts here are rather unambiguous: since the 1940s, lower rates of unemployment have been followed, three years later, by a lower capitalist income share. And if this relationship continues to hold, the implications for capitalists are doubly negative. Since unemployment has already been trending downward for the past few years, the capitalist income share is likely to lose further ground in the three years ahead quite independently of Trump’s policies. And if these policies end up delivering even lower rates of unemployment, the capitalist income share is likely to shrink further.

    Second, a significant rise in employment will probably kill the stock market. Figure 2 – taken from our paper ‘A CasP Model of the Stock Market’ (Bichler and Nitzan 2016: 146) [link] – compares two series. On the left, it plots the ratio of stock prices to the wage rate, an index for the power of capitalists relative to workers. On the right, it displays the rate of growth of employment five years earlier, an inverted proxy for the strategic sabotage inflicted on workers (the two series are smoothed as ten-year trailing averages; click on image).


    And here too the historical regularity seems clear: since the 1940s, rising employment growth has been followed, five years later, by a falling stock market (since the wage rate is usually a monotonically rising series, most of the movement here comes from changes in stock prices). With this pattern in mind, investor enthusiasm for employment growth policies seems somewhat misplaced: if the Trump administration succeeds in reversing the 30-year downtrend in employment growth, the likely result will be not a secular bull run, but a major bear market.

    2. The Current Crossroad

    To put these constraints in a longer historical context, consider the following excerpts from our article ‘A CasP Model of the Stock Market’ [link]:

    Over the past thirty years, U.S.-based capitalists (and others investing in U.S. equities) have managed to increase their capitalized power relative to the underlying population from record lows to record highs [Figure 2 above]. In our view, this increase has been driven by two related processes: (1) a redistribution of income from non-capitalists to capitalists, along with a growing conviction that the resulting inequality could be maintained and even augmented in the future; and (2) mounting strategic sabotage in the form of lower employment growth. [. . . The] first process meant a higher hype coefficient [i.e., overly optimistic long-term profit expectations] The second process has had a double impact: on the one hand, it assisted the first process by restricting wages and boosting profits, while, on the other, it enabled looser monetary policy and lower interest rates, thus helping to reduce the normal rate of return [and raising the discounted value of expected future profit].

    These two processes were in turn underwritten by a major creordering of the underlying mode of power. Following the MBM [major bear market] of 1968‑1981, capital has been progressively transnationalized, leading to the gradual disempowerment of the underlying domestic populations, the lowering of corporate and personal tax rates for high-net-worth individuals, the hijacking of macroeconomic policy for capitalized ends and the cajoling-forcing of pension funds and public assets into the stock market, among others consequences. But no spring can be pulled indefinitely. Conflict-driven redistribution and lower interest rates have pushed capitalized power toward its historical asymptote, and this approach means that the United States – and maybe the world as a whole – is now facing a historical crossroad. (Bichler and Nitzan 2016: 150-151)

    Given this assessment, we outlined two possible trajectories for the U.S. looking forward:

    The less likely of the two is some version of Jack London’s The Iron Heel (1907), in which the U.S. ruling class breaks through its historical asymptote by imposing a mode of power much harsher than the one prevailing over the past two centuries. To sustain this new mode of power, the rulers would have to further redistribute income in their favour, domestically and/or globally, leading to historically unprecedented levels of inequality. Moreover and crucially, they would have to cast this greater inequality as the ‘new normal’ as well as persuade investors that this greater inequality is here to stay (so as to prevent hype from collapsing). And while doing all of that, they would also need to keep interest rates and profit volatility low in order to prevent the discount rate from rising significantly – a tall order in a world marked by greater sabotage, intensified violence and therefore greater instability. The other, and in our view more likely, possibility is that history will repeat itself, and that, sooner or later, the United States will experience another MBM [major bear market]. (Bichler and Nitzan 2016: 151)

    3. A Trumped Recovery?

    How do Trump’s hyped rhetoric and proposed policies fit into this framework? On the face of it, his authoritarianism, apparent disdain to the rule of law and promiscuous endorsement of violence make him a possible harbinger of the much harsher regime needed to secure and possibly extend current levels of capitalized power. This harsher regime, though, would have to cater to capitalist interests, and so far, Trump’s proposed policies point in the opposite direction.

    Modern capitalism is guided by differential capitalization – particularly differential stock prices – and differential stock prices are driven not by rapid economic growth, but by the ability of owners to increase their capitalized power relative to the underlying population. As noted, since the 1980s, the differential capitalized power of stock owners increased due to a combination of a rising capitalist income share and falling interest rates, and taken at face value, Trump’s policies threaten both.

    As we have shown in Figure 1, Trump’s focus on job growth stands to undermine the capitalist share of income. But job growth is likely to hurt capitalists in another important way – namely, by causing interest rates to soar and in so doing further undermining equity prices.

    The history of this latter process is illustrated in Figure 3 (updated from Bichler and Nitzan 2016). The chart shows two series: the annual rate of growth of employment (lagged five years) plotted against the left scale and the yield on ten-year government bonds on the right. We can see that, until the middle of the twentieth century, there was little or no connection between the two series (Pearson coefficient of –0.12). But from the early 1960s onward, with the entrenchment of countercyclical Keynesianism, employment growth has become a nearly perfect five-year leading predictor for interest rates (with a Pearson correlation of +0.89). During the 1960s and 1970s, the welfare-warfare state lessened the strategic sabotage on the underlying population and accelerated employment growth, but this process triggered higher interest rates that grounded the stock market. The 1980s rise of neoliberalism, though, flipped the cycle. Employment growth decelerated, interest rates dropped, and the capitalized power of owners, fuelled by growing strategic sabotage and rising liquidity, soared (click on image).


    In our ‘CasP Model of the Stock Market’ (2016) [link], we developed the concept of a ‘CasP policy cycle’, the idea that government policy, insofar as it caters to the imperative of capitalized power, favours low employment growth in order to enable low rates of interest and sustain the capitalist share of income. If Trump proceeds with and succeeds in reversing this CasP policy cycle, his authoritarianism may end up undermining rather than boosting capitalized power. In this sense, his regime could well mark the beginning of the next major bear market.

    References

    Bichler, Shimshon, and Jonathan Nitzan. 2016. A CasP Model of the Stock Market. Real-World Economic Review (77, December): 119-154.
    London, Jack. 1907. [1957]. The Iron Heel. New York: Hill and Wang.
    Nitzan, Jonathan, and Shimshon Bichler. 2014a. Can Capitalists Afford Recovery? Three Views on Economic Policy in Times of Crisis. Review of Capital as Power 1 (1): 110-155.
    Nitzan, Jonathan, and Shimshon Bichler. 2014b. Profit from Crisis: Why Capitalists Do Not Want Recovery, and What That Means for America. Frontline, May 2, pp. 129-131.

    Now, I’m not concerned about President Trump undermining rather than boosting capitalized power. Importantly, if you look at his closest economic advisors, they are all part of the financial elite like his friend Stephen Schwarzman, CEO and co-founder of private equity powerhouse Blackstone, so you can rest assured his administration will keep on trying to boost capitalized power.

    On Friday, US payroll gains rebounded in April by more than forecast and the jobless rate unexpectedly fell to 4.4 percent, signaling that the labor market remains healthy and should support continued increases in consumer spending. According to Shimshon and Jonathan, employment gains will cause interest rates to soar and

    I wouldn’t read too much into this latest employment report. Employment is a coincident economic indicator, not a leading indicator, but this will provide the Fed an excuse to raise rates at least one more time. The Fed wants to raise rates to have ammunition when the next crisis strikes.

    And there will be another crisis, that much I can guarantee you. The next economic shoe is dropping in the US at a time when the rest of the world is very fragile. Will Kyle Bass be right about China’s looming credit crisis? He was spectacularly wrong on Japan but he might be right about China.

    And remember a crisis in China will reinforce global deflationary headwinds, which is music to capitalists’ ears as long as it doesn’t develop into a full-blown debt deflation crisis and Great Depression type high unemployment.

    In fact, Jonathan and I discussed this doomsday scenario and he said the system cannot support high unemployment like we had during the Great Depression. “This would threaten capitalists’ hold on power and we would have a major crisis before reaching that point.”

    I told him that I see a bleak future where inequality gets much worse (due to rising unemployment and pension poverty, technological advances, etc.), debt deflation, one crisis after another (China, Europe, etc.) and something is going to give eventually or else the system will implode.

    Then he showed me Figures 9 and 13 from his paper A CasP Model of the Stock Market (click on images)



    Basically, when systemic fear is high, like now, capitalists look at current, not future profits. The first chart does not bode well for stocks going forward and the second one doesn’t bode well for employment growth, so expect some type of ‘strategic sabotage’ to maintain capitalists’ hold on power.

    Take the time to carefully read A CasP Model of the Stock Market, it is excellent and has a lot of information for everyone, including institutional investors.

    Finally, Jonathan and I discussed the pension crisis and he thinks pensions can be part of the solution to limit inequality, democratize housing and curtail the disastrous effects of stock market crises. You can read his and Shimshon’s thoughts here.

    I hope you enjoyed reading this weekend comment. Please remember to kindly donate or subscribe to this blog on the top right-hand side under my picture. All donations, big or small, are welcomed and I thank all of you who contribute to this blog.

    Below, Jonathan Nitzan’s presentation on A CasP Model of the Stock Market. Take the time to listen to this presentation, it’s not straightforward but I think Jonathan does a great job explaining his and Shimshon’s theory on capitalized power, how it’s intertwined with systemic fear and strategic sabotage. You can track Jonathan and Shimshon’s latest work here.

    Also, Kyle Bass, Hayman Capital Management’s chief investment officer and managing partner, discusses China’s economy and the global risks to financial markets with Bloomberg’s Erik Schatzker at the Milken Institute Global Conference.