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President Xi Jinping, representing the overwhelming sentiment of China’s huge population, has continued to crack down on corruption. His “Mass Line Campaign” involves punishing and halting the excesses of the booming Chinese market, and ensuring that the Communist Party keeps absolute control of the economy.
Xi Jinping has gone after some of the top officials in China who have been caught taking bribes, who are not fairly enforcing the law, or who are otherwise working in the service of profit-making institutions. Xi is firmly committed to the political ideas articulated by Deng Xiaoping during the early 1980s. As Xi makes clear in the many pages of his widely distributed book The Governance of China, capitalism exists in China only to advance the Communist Party’s goals of creating a prosperous society and strengthening “Socialism with Chinese Characteristics.” In accordance with the Deng Xiaoping Theory, capitalism in China will not be allowed to run rampant, and the needs of Chinese society as a whole will always come before the profits of capitalists, both foreign and domestic. Xi is moving to secure that the state sector of the Chinese economy remains dominant, and that the private corporations will remain tightly controlled and restricted.
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This strategy of utilizing foreign capitalist investment to strengthen Chinese socialism has been cemented as the political line of the Chinese Communist Party since the early 1980s. However, during the late 1990s, the world has looked on to see factory owners and capitalists running wild throughout Chinese society. The widely told horror stories about the facilities owned by FoxConn and Honda, the routine bribery of government officials, and the endless groveling efforts to accommodate US and European corporations have all become a source of national outrage. The average Chinese person is furious about a pattern of corrupt betrayals of the 1949 revolution and its principles.
The increasingly contradictory political and economic situation in the People’s Republic has been synthesized in the rise of this leader whose common nickname is “the big boss.” Xi Jinping, a powerful political figure championing the over one billion working-class people in the country, declares “Mao Zedong Thought must be central in all things.” Speaking for the Communist Party he proclaims, “We have declared war against extravagance and wealth.” In speeches utilizing phrases pulled from The Little Red Book, Xi is forcefully pulling the private sector of the Chinese economy back under government accountability. Authority is centralizing, and the party’s practice is becoming more unified.
With his sweeping anti-capitalist reforms, Xi Jinping is not only battling against US corporations and domestic profiteers. He also is battling against the right-wing of his own party who are reluctant to see their bureaucratic privileges restricted. Xi’s mass line campaign is exposing and punishing a deeply embedded cartel of Western bootlickers, who want to erase everything Mao and Deng ever wrote, except of course the beloved phrase “Too Get Rich is Glorious.” Xi’s crackdown on corruption is shaking the world, and the cartels in Wall Street and London, along with a few of their well-paid allies in Shanghai, want it to immediately cease.
What Caused the Crash?
The US press, functioning as the voice of its wealthy owners, declared the recent crash of the Chinese stock market to be the result of Xi Jinping’s policies. This response was predictable as Xi Jinping has long been subject to a demonization campaign in the Western press. For well over a year, The New York Times, The Wall Street Journal, and all other voices of the rich and powerful have been condemning Xi Jinping with words like “Stalinist,” “Neo-Maoist,” “Hardliner,” “Authoritarian,” “Dictator,” and every other political expletive they can muster.Slipped into the heavy condemnations of Xi found in the US press are subtle admissions of his overall success. The achievements of Xi Jinping that scare his detractors the most are taking place beyond China’s borders. Xi Jinping’s vision of a “New Silk Road” involves the expansions of trade between Russia and China, including the construction of high-speed trains and a natural gas pipeline. Xi is pushing the Chinese state and corporations directed by it to expand their investments in countries like Pakistan and Nigeria.
The articles in the US press blaming Xi Jinping for the crash offer little explanation of why he is at fault. They simply quote voices from leading market- oriented Chinese think tanks blaming him, and further bemoaning his “centralization” of authority, especially in the economic field.
The Financial Times, a London newspaper which functions as a more serious publication of economic analysis, has admitted that the cause of the Chinese stock market crash wasn’t Xi Jinping’s regulations, but rather, a lack thereof. An article in the July 14th issue says that the cause of the crash was irresponsible practices from various “fund matching corporations.” The Financial Times writes: “Since they were not subject to regulation, fund-matching companies permitted higher leverage and lower barriers to entry.”
The Financial Times also revealed another interesting tidbit of information. In the United States, 55% of the population is currently somehow invested in the stock market, and would be directly affected in the case of a financial crash. In China, less than 6% of the population is tied into the Stock Exchange. A crash on Wall Street would have exponentially larger consequences for the US than the recent crash has had in China. Despite its large private sector, Chinese society remains mostly insulated from fluctuations of the market.
Furthermore, even in the direct aftermath of the crash, China still reached its quarterly goal of 7% growth. The world was expecting that, finally, the crash and much heralded “slow down” that preceded it, would somehow dramatically halt the powerful juggernaut of China’s state-controlled economy. However, it didn’t happen. China still reached its quarterly 7% growth goal.
The Financial Times now reports that, “Emergency measures designed to curb market free fall in the Chinese Stock market last week apparently succeeded in stabilizing the market.” Essentially, less than a week after the dramatic financial episode, the Communist Part controlled economy has whipped the market back into order. The vast plans for government construction of trains, irrigation systems, and other modernizations are plowing ahead.
Escalation of Violence
The external attacks on China and its invincible economy have risen in recent months. Chinese officials recently arrested a number of Chinese Muslims who had been involved with Saudi-backed Takfiri extremist groups. China has already experienced a wave of stabbings and other horrendous ISIS-style killings. The suspicion that somehow the United States and Saudi Arabia are involved in fomenting extremism and terrorism among the China’s Islamic population is now basically confirmed.The Trans Pacific Partnership, a trade deal that is loathed by progressive people on every continent, has new anti-Chinese economic stipulations. The US-aligned signatories in Asia such as the Philippines, Indonesia, and South Korea, will be required to set up further economic barricades against Chinese investment as part of this widely unpopular treaty.
The United States continues to accuse China of “Cyber Warfare” against the United States. The United States military has continued expanding its presence in the Pacific and in Central Asia. Recently, US airplanes created an incident by violating Chinese airspace.
Vietnam has joined with the United States in its regional anti-China campaign. The United States is utilizing a classic Cold War tactic, playing Communist Parties against each other, in order to further the aim of their mutual destruction.
Xi Jinping’s trademark policies are designed to rebuild the somewhat eroded links between the Chinese Communist Party and those who brought it into power. Xi is also gradually and subtly working to re-establish the international bonds that once made China the epicenter of a global explosion of anti-imperialism, in a time when Mao Zedong thundered, “Revolution is the main trend in the world today.”
The policies of the United States in China are self-defeating. The harder that international finance pushes its crusade against China, the stronger Xi Jinping and his New Silk Road will become. The two are directly linked.
Caleb Maupin is a political analyst and activist based in New York. He studied political science at Baldwin-Wallace College and was inspired and involved in the Occupy Wall Street movement, especially for the online magazine New Eastern Outlook.
This essay first appeared:http://journal-neo.org/2015/07/30/the-chinese-dream-plows-onward-the-truth-about-china-s-stock-market/