Historical Legacies, Global Financial Crisis, and China’s Working Class Movement

, by  China Left Review, PHILION Stephen

The global financial crisis that took on its most recent and dramatic forms in 2008 is one that has had all eyes on China. While most of that focus has been on how China’s political leaders react to the crisis, especially in terms of currency revaluations and strategies to move from export dependence to domestic consumption based growth, this volume instead focuses on how the financial crisis has impacted China’s working class. We give special attention to trends in China’s working class movement and how they are shaped by both the legacy of trends in Chinese socialist development since 1949 and the ongoing global financial crisis.

Suffice it to say, China’s working class has changed greatly since 1949, and it’s fair to say that some of the biggest changes have occurred in the recent two decades. The financial crisis appears to have merely solidified them. China has seen dramatic growth rates in the last three decades, this much is clear enough. Yet it is likewise undeniable that much of this growth has occurred on the backs of China’s working class, whether we are talking about China’s ‘traditional’ State Owned Enterprise (SOE) workers or the ‘new’ working class seen in the form of migrant workers who have relocated from rural to urban regions in China in search of work in the ever growing private and export oriented labor markets.

Since the financial crisis huge amounts of public monies in China have been spent on stimulus programs designed to boost consumer capacity in the face of crises of (global) overproduction. Nonetheless, as the articles (a combination of more traditionally academic and activist oriented selections) in this edition suggest, this has not deterred China’s business and political elites from finding every imaginable way of intensifying the level of exploitation that China’s workers face, even during the recent period of ‘labor shortage.’

The editors of this volume of China Left Review believe that what is needed to understand the impact of the ongoing global financial crisis on China’s working class is not only attention to the plight of China’s working class. There already is plenty of that. However, much of what is written on the state of China’s workers today is informed by an analysis that often, even in some left variants, takes for granted many of the ideological positions associated with neo-liberalism. Most notably, liberal commentators on China’s working class movement today overwhelmingly take a “TINA1” approach to the question of what to do about the expansion of capitalist wage-labor based markets in China (and anywhere else for that matter).

This is the point of departure for this volume’s contributions. The contributors reject the idea that accepting the logic of capitalist market based development and its attendant wage-labor based social relations of coercion are the only option, now or in the future. Instead, they take seriously the role Chinese socialist development played in enabling the kind of economic growth China has experienced in recent decades. That does not require denying the pitfalls of this model during the Maoist period. Instead they look at how experiences of Chinese socialism, prior to the turn to markets under Deng, provide today’s workers in China with the tools to think about solutions to their variegated crises that do not necessitate surrendering to the logic of capitalist (‘free’ wage-labor) based social relations of production. Furthermore, while it is plainly an advance for Chinese workers to secure legal rights to assemble, petition, organize unions, etc., the contributors to this volume do not take for granted that securing these rights is either the end goal or is the only means available to address the root causes of the problems of workers in China today.

Since the financial crisis firmly took hold in 2008, many have wondered when China’s working class would react with a stepped up militancy and organization. While China has been the site of a great number of collective incidents such as strikes, marches, sit-in occupations, road/train blockages and the like led by workers, nevertheless more might be expected given the conditions faced across sectors of production. Indeed, despite the massive depth of resistance to privatization in the state sector in the late 1990s and 2000s, organizationally SOE workers have struggled to find ways to unite and go beyond single factory causes. Likewise, while migrant workers in China’s cities have shown they too are able to organize strikes and to demand greater legal rights (or enforcement of those rights), they too have faced challenges when trying to move to the next level.

This volume contextualizes the situation of China’s working class movement during this period of global financial crisis and argues that alternatives to capitalism remain central to the success of that movement in the future. The first part of the volume begins with four articles that lay out the historical experience of the Chinese working class under the first phase of Chinese socialist development, otherwise known as the Maoist period. In this period (1949-1978) we see the foundations of both some of the problems plaguing China’s working class and its potential to develop a consciousness that challenges the ideological frame of neo-liberal capitalism today.

“The Current and Future Condition of China’s Working Class,” authored by the editorial collective at Research on China’s Workers (RCW, 中国工人研究 , [a(http://www.zggr.cn/2) www.zggr.cn/2]) provides an overview of how the Chinese working class’ present condition springs from issues specific to China’s socialist developmental path. For almost thirty years, Chinese workers (at least those in SOEs) were trained to think of themselves as a special class. Protections from market vagaries accompanied that status, whereby virtually all basic life expenses were taken care of by the work units to which workers were loyal for life. However, the RCW editorial collective argues that their existence as a class that was protected from capitalist markets rendered Chinese workers inexperienced in struggles against capitalism. While the Cultural Revolution was carried out on the basis of Mao’s expectation that constant battle against capitalist tendencies within the Party was necessary to prevent capitalism’s restoration in China, the reality is that China’s workers were, in most instances, not drawn into such campaigns. Where they did participate in the Cultural Revolution, SOE workers were more likely to be defenders of the conservative forces within the Party and suspicious of threats to Party stability. By the time the conservative forces within the Party took their ‘market turn’ in the early 1980s, SOE workers lacked the experience of struggles with capitalists (or capitalist markets) and typically went along with ‘reforms’ in Chinese labor markets that bit by bit undermined the status and power they once had in both their factories and in society generally.

It would be too simplistic to argue, as many have in the literature on China’s working class, that China’s working class was simply coddled and had no experiences during the Maoist years that might aid it in developing strategies for challenging the relations of coercion that shape capitalist markets. Indeed, we know that China’s working class was not trained to be simply loyal servants of the Party and that the Party was not monolithic. In this regard, Han Xiya’s contribution to this volume is an especially important one. Han suggests that if one looks back at the archival evidence from the early years of Chinese socialism, it is clear that there were efforts within the Party to critique the undemocratic relations between managers and workers in the SOEs. Most notably, Deng Zihui’s efforts at the 4th Plenum to push for greater worker control over production are critical, insofar as they suggest how the history of socialist development, failings and all, still provides, within a context specific to China, historical sources for developing alternatives to imposing capitalist markets on Chinese workers today. Han Xiya’s conclusion is worth quoting:

In publicly-owned enterprises, internal contradictions within the working class were unable to obtain proper resolution, and it became impossible to establish the proper relationships between people involved in productive labor so direly needed in the system of socialist production. The alienation of unions from the masses did not change, and the alienation of the Party and the administrations of enterprises from the masses became even worse. The consciousness of the workers as their own masters and the enthusiasm of the workers and masses for socialism were seriously undermined. Workers were disheartened and demoralized, which prevented socialism from realizing its potential as a superior system. This experience teaches us a powerful lesson.

Han’s second article in this edition supplements the first with a discussion that reveals the efforts to make workplace relationships more democratic did not end after the earlier attacks on the successive leaders of the All China Federation of Trade Unions, Li Lisan and Lai Ruoyu. Han shows how debates among socialist countries (influenced by Mao’s critique of the Soviet textbook on political economy) about what distinguishes socialist relations resulted in the introduction of interesting experiments and innovations in workplaces. As Carmen Sirianni documented in his Workers’ Control and Socialist Democracy: The Soviet Experience,3 debates and efforts to democratize workplaces have been part of socialist history as much as bureaucratic tendencies that reinforced hierarchical relations of production. These experiments and innovations should be valued as we continue to explore alternatives to the capitalist logic of production.

The RCW editorial collective argues that although China’s workers were very loyal to the Party, this does not mean that they were not able to recognize how their power was being eroded as the ‘reform’ process went on throughout the 1980s. The reform strategy of rewarding SOE workers with increases in wages in exchange for giving factory directors and managers more power worked as long as SOE workers continued to have employment in SOEs. While China’s SOE workers lacked experience struggling against capitalism, they did retain a strong collective memory of the status and security that socialist development accorded them, and this shaped their opposition to the mass waves of dismissals in the mid to late 1990s and 2000s.

Because of that historically based memory, SOE workers’ protests in the 2000s were more likely to challenge the ideological basis of privatization and the expansion of capitalist social relations of production in China. Joel Andreas’s “Expropriation of workers and capitalist transformation in China” argues that capitalist relations of production have taken firm hold in China today, and they have only been intensified by the recent global financial crisis. It is true that China has reacted to the crisis with huge infusions public sector spending and promoted social programs for displaced migrant workers and rural farmers. However, social struggles initiated by China’s working class, as Zhang Yaozu notes, have taken on new forms that are now exclusively a product of direct experience with capitalist social forces. Most notably, today’s new working class consists of workers who have migrated from rural to urban regions of China, as well as recent college graduates in technology working as as skilled/managerial workers in service sector jobs. Both strata of this new working class have experienced transitions in consciousness that have been critically informed by changes associated with the global financial crisis.

The second and third sections of this volume deal with how China’s working class movement has developed in the face of the ongoing financial crisis and what this tells us about the possibilities for organizing a working class movement in China that can win more than the ‘right’ to bargain with Chinese or multi-national capitalists in the future. The second section looks at the movement activity by China’s ‘traditional’ working class, i.e., those in the SOE sector. The first two articles overlap with a shared analysis of the heavily covered protests by SOE workers in Liaoyang against privatization at the Liaoyang Ferro-Alloy factory in 2002. This activity received widespread media coverage outside China because of the scope and relative success of the action. Many of these reports suggested that what was so significant about the protests, in addition to their unprecedented coordination with other SOEs in Liaoyang, was their connection with liberal pro-democracy organizations, most notably the banned Democracy Party of China. However, the analyses in this volume, provided in two separate articles by Liao Yuan4 and Pei Haide, paint a different ideological picture of SOE workers, whose point of reference, they argue, is socialism rather than free markets. Liao argues that the Ferro-Alloy workers’ struggle succeeded due to the extent that workers drew heavily on a deep appreciation of and application of grassroots workers’ democracy as the basis of their organizational work via Workers’ Representatives Committees, an institution unique and central to SOE workers’ struggles against privatization in the last decade. This substantive application of the principle of workers’ democracy was not one whose end goal was free trade unions, but the defense of the SOE as a socialist collective which protects workers against the vagaries of capitalist markets.

Pei Haide further notes that the Liaoyang protests were only the first of two waves of SOE protests in the 2000s. The second wave occurred in 2009, with an explosive intensity that equaled that seen during Liaoyang four years earlier. Pei contends that this second set of protests went even further than the Liaoyang case, where movement organization largely came to an end once the Liaoyang City government met the workers’ demands. Highlighting the case of the Tonggang Steelworkers’ struggles, Pei notes that after the SOE workers’ demands were met they continued to be involved in other workers’ struggles, “suggesting that the strength of China’s working class movement was growing as a social force.”

Stephen Philion’s “By What Right do Chinese State Enterprise Workers Fight for Rights?,” anticipates the ideological argument that both Pei and Liao have with liberals on the direction of China’s working class movement. Philion also argues that cases of workers’ rebellions in Zhengzhou, the Provincial capital of Henan, show that not only did SOE workers draw on memories of the socialism of the Maoist period, they also attempted to continue the SOE form as worker run cooperatives. To do this they had to fight for more than the legal rights that capitalism in its liberal democratic form accords workers (usually only won after periods of protracted struggle with capital and the state). Philion (like Chris Chan, discussed below) questions whether this limited form of rights can give workers the tools they need to address the fundamental crises of unemployment and the loss of social welfare protections, not to mention uphold their basic dignity.

The volume’s third and concluding section provides a close look at the impact of the global financial crisis on struggles carried out by China’s new working class (rural migrant workers and recent university graduates looking for work in high-tech and service sector industries). In a piece that at times reads like it was taken from Marx’s chapters on the struggle for a normal working day in volume one of Capital, Shen Mei, an independent researcher based in Beijing, provides a detailed analysis of how the financial crisis has handed China’s factory owners an opportunity to squeeze greater amounts of surplus (in the form of work time and intensity) from China’s migrant working class. This is the case even as owners and the media have talked up a ‘labor shortage’ in the export oriented production sectors. The financial crisis gave owners the perfect excuse for coercing workers into leaving their posts ‘voluntarily.’ Even when productivity levels improve, owners still do not engage in much new hiring, instead preferring to find inventive ways to dragoon workers into working longer hours.

In turn, migrant workers’ militancy has only increased in ways that are promising for the viability of China’s working class movement. Today’s migrant working class is not one that has either the option or desire to return home to the countryside. Pun Ngai and Ren Yan’s “The Implications of Nongmingong (Peasant Worker, Migrant Worker): An Incomplete Proletarianization” argues that significant elements of the class formation of today’s ‘new’ rural migrant working class are locked in contradiction. These contradictions have been under-theorized in mainstream literature, which delinks migrants’ experience as second class citizens from the relations of production that they face on a daily basis as workers in the factory system. Migrant workers’ plight is thus commonly understood to be solely the result of their lacking full citizenship rights as urban residents, without taking into consideration that the very relations of production that shape their lives where they work, which both complements and reinforces the second class citizenship experience that they face in the cities. It is not enough, therefore, to consider migrant workers as a ‘stratum.’ Their peripheralization in the cities stems from a broader neoliberal strategy within and outside the workplace to accumulate without investing in the long-term development of the wage-laborers. This contradiction, one that is not unique to China or its rural migrant working class, will likely only grow sharper as more migrant workers populate the export-oriented factories that fuel the economic viability of both China’s urban economy and the global economy as a whole. The rural migrant worker in China is now faced with ongoing struggles to find work or to deal with employers who know that workers no longer have the luxury of dealing with their dissatisfaction by quitting and looking for a job in another factory.

Chris Chan’s “Class Struggle in China: Case Studies of Migrant Worker Strikes in the Pearl River Delta” is an especially exciting contribution to both this volume and the discussion of Chinese working class consciousness today. Based on in-depth field research at a labour service center in Shenzhen for almost three years, Chan’s findings challenge the ‘death of the working class’ thesis, Chinese or otherwise. Contra scholars such as Ching Kwan Lee (and a number of contributors to this volume), Chan argues:

Instead of comparing migrant workers with their state-employed counterparts, whose historical and material foundations are very different, the possibilities and limitations of a more inclusive class consciousness should be explored through historical comparisons amongst (Chinese) migrant workers in their struggles in the workplace and community.

Likewise, instead of seeing the problem of class broadly in terms of expressions (or discourses) used by workers, Chan finds that even though China’s migrant workers do not use more explicitly class laden terms such as ‘boss’ to describe their common enemy, they recognise the class basis of their enemies across nationality, striking against their ‘compatriot’ bosses or ‘foreign’ bosses with the same level of militancy:

Whilst Lee (2007) focused on workers’ discourse as evidence of the weak working class identity amongst migrant workers, I rely on the process of action as a manifestation of class identity and solidarity to suggest that these workers’ protests are part of the class struggle taking place within China.

It is this focus on the role of workers’ class-based collective agency in the remaking of Chinese society that the diverse articles in this volume share. There remains room for debate among the contributors on working class agency during the Cultural Revolution, the impact of the financial crisis on migrant workers’ organizational capacities, the ideological differences or overlap between China’s traditional and new working class, and other questions. However, the contributors have asserted the continuing relevance of class, class analysis, and class struggle as broader questions of revolutionary strategies in China are debated in the aftermath of the ongoing global financial crisis. The publication of this volume is not intended to suggest that there are easy answers, but that by acknowledging the relevance of such concepts in China today, China’s working class will be better equipped to yet become the masters of their society.

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