[Marxism] China's relationship with Cuba is progressive, not "sinister"

Richard Fidler rfidler at cyberus.ca
Fri Mar 4 19:01:51 MST 2005

Fred Feldman came upon an exchange over on the Green Left Weekly list 
and got a bit befuddled as to who was saying what, and where. That, I 
think, is where he got the quote he mistakenly attributed to me on this 

It began with a post in late February by Walter Lippmann referring to a 
U.S. media columnist’s expression of unease about China’s growing trade 
links with Cuba. After noting the positive assistance such links give to 
Cuba, Walter added the comment: "China is not going to meddle in Cuba's 
internal affairs as some of the European embassies did."

A few days later, however, Walter found the same columnist (Oppenheimer) 
citing a report by a Chinese think-tank that was advising the Cubans to 
abandon its "theoretical foundation" and embrace and accelerate market 
reforms, to allow some people to get rich and to privatize state-owned 
companies. As those familiar with Walter’s posts will know, Walter 
basically divides the world between those governments that maintain 
friendly relations with Cuba and those that don’t. He tends to be quite 
defensive about the first group. Predictably, Walter expressed some 
scepticism about this Chinese report, saying he had no reason to trust 
Oppenheimer’s summary of it.

I then posted a URL to the Chinese report, 
http://makeashorterlink.com/?I2971299A, noted that its contents tended 
to bear out the journalist’s summary, and then offered a few comments of 
my own, basically summarizing some of the key ideas in the report that 
underscored not only the advice to the Cubans but how that advice 
indicated the profound differences between "reforms" in China and Cuba:

>>Although peppered with ritual references to China and Cuba as both 
>>being "socialist countries", it underscores very vividly the sharp 
>>contrasts in the nature and thrust of the "economic reforms" under way 
>>in each country.

The report provides a useful summary description of the major components 
of Cuba's reforms since the collapse of the USSR and "socialist bloc". 
It shows how successfully Cuba has overcome this terrible setback, 
restoring production levels while "Health spending remained almost 
constant in peso terms, education spending declined marginally, and 
social security payments increased between 1989 and 1998." (The report 
is dated 2002.)

It notes that while the Cuban state's monopoly on foreign trade has been 
breached in significant ways, there is still no free market in labour.

The second part of the report, on "What Can Cuba Learn from China?", 
states its guiding assumption up front: "the nature of the two reform 
processes should be the same." It then goes on to sing the praises of 
"socialism with Chinese characteristics" (why Cuba should want that is 
not explained), while in fact making perfectly clear that China's mode 
of production is capitalist....

[I then cited figures showing a decline in "public ownership" in China 
from 78% 1978 to 40% in 1999, and an increase in "non-public ownership" 
during the same period from 22% to 60%. These figures likely understate 
the level of private ownership, as the Chinese classify the state's 
share of joint-stock, predominantly privately owned corporations as 
"public ownership".]

The meaning of these figures is partially disguised by vague terminology 
referring to public ownership as "dominant" and the continuing 
"foundation" of China's "socialism".

The report criticizes the Cubans for thinking "socialism and market 
economy are not compatible". But at the same time it notes what it terms 
"alarming" figures on "unequal income distribution" in China, especially 
between rural and urban areas. In contrast, "Those Chinese who have 
visited Cuba are surprised to see that Cuban officials at different 
levels do not enjoy much more privileges than the common people."

The report deplores the massive corruption in today's China, citing a 
study that such practices cost the economy "13.2 - 16.8% of the nation's 
total GDP". It adds: "It is believed that this rough estimation was 
quite conservative...." And it goes on to warn the Cubans that if and 
when they follow the Chinese road they too will experience high levels 
of corruption.

And oh yes, the report warns the Cubans they should also be prepared for 
massive unemployment "as SEOs [state-owned enterprises] reforms tend to 
turn a large number of workers out of their post". That is, labour power 
once again becomes a market-traded commodity, with all that entails.

Somehow, I suspect the Cubans, while reading this Chinese report with 
interest, will also take it with more than a grain of salt. And they 
might just be inclined to stick to their own road, leaving the 
"capitalist road" to the followers of "Deng Xiaoping Theory".<<

Michael Karadjis, in a post to the GLW list from Hanoi, then pointed to 
a "sinister" side of China’s advice to Cuba, while making clear that he 
was in favour of increased trade ties between the two countries. He 
noted the likelihood that China’s views might "drive a wedge into the 
Cuban CP among those impressed from a distance with China's rapid 
growth", a point I had failed to mention. I don’t think Michael will 
mind my quoting his observations, which reflect as well his own 
experiences recently in Vietnam:

>> The Chinese report on their 'fraternal' advice to Cuba to massively 
>> privatise its economy is important evidence of how sinister the 
>> growing Chinese relationship is. Not in the sense that Cuba or 
>> Venezuela should not be trying to get as many trade and investment 
>> deals as they can from non-US governments (eg Spain, Canada, China, 
>> Russia etc), obviously this is essential, but let's not fall into the 
>> trap of thinking the Chinese deals have a similar social character to 
>> the Cuba-Venezuela integration agreement, or that they have a 
>> different social character to the Spanish and Canadian investment in 
>> Cuba's oil industry.

If anything it is more dangerous precisely because the bullshit about 
being 'fraternal' and all that can more easily drive a wedge into the 
Cuban CP among those impressed from a distance with China's rapid 
growth. Certainly most young VCP cadres in Vietnam look to China as some 
kind of model because it has "taken far more risks", "not been as 
conservative" etc etc as the Vietnamese leaders. All these things are 
said in massive ignorance.

Richard is very right to point out that the alleged 40 percent of the 
Chinese economy still in "public" hands is not at all the same thing as 
being in state or in any sense social hands, as it includes the large 
category of semi-privatised via 'joint-stock' (shareholding) firms where 
the state remains one of the shareholders. These are not only the small 

For example, while the CCP claimed it would sell off the small state 
firms but maintain the 520 largest strategic firms in "public" hands, we 
read that by late 2001, "of the he 520 key enterprises owned by the 
State * or with the State as the controlling shareholder *, 430 were 
transformed into companies, accounting for 82.7 percent of the total. 
With state-owned enterprises being transformed into companies, the 
company stock listing was constantly expanding" (Market Oriented Reforms 
of Chinas Enterprises in Retrospect, China Internet Information Centre, 
China.org.cn, November 7, 2003). Thus it is among these key firms that 
"the stock lisitng" is expanding even if the state "remains the 
controlling shareholder". These are * not * state firms. Moreover, by 
late 2001, "over 90 percent of newly established enterprises were joint 
stock enterprises" (Development of the Non State Owned Sector, China 
Internet Information Centre, China.org.cn November 7, 2003). Further, 
even this 40 percent figure is old - the report quotes the "public" 
sector of the economy in 1999. Yet only in the late 1990s did the 
massive privatisation drive start, since when 40-50 million Chinese 
workers have been laid off from former state firms. Zhou Fang from 
China's Finance Ministry puts the public share at only 20-25 percent of 
GDP, this being "not a matter of concern" ('China shares its experiences 
of State companies reform', Vietnam Investment Review, July 1-7, 2003). 
This is consistent with US estimates, eg, 'Private enterprise produces 
75 percent of GNP', CNN website, January 30, 1999, and Tanner, T, 
'Private Property in the Middle Kingdom', Nixon Center, In the National 
Interest website, 

In particular, the role of Chinese state firms in industry crashed from 
77.6 percent in 1978, to 54.6 percent in 1990 and * 20.3 percent * in 
1999 ('Chinas Private Sector', K.C. Kwok, TDC Trade, Economic Forum, 21 
July, 2001).

The Miami herald report posted by Walter is positively laughable. "China 
has more than 10,000 tycoons who have amassed more than $10 million 
each, and has lifted 250 million people out of poverty over the past two 
decades. Meantime, Cuba has made all of its 11 million people uniformly 
poor, and they have gotten progressively poorer."

Never mind that these 10,000 tycoons continue to amass amazing wealth 
while China's poor have to pay massive fees to get into a hospital or 
got to school, that China's female literacy rate is 78 percent, the 
lowest in the region, while Cuba's allegedly poor people have world 
class health and education systems.

What the Chinese report meant when it advised the Cubans that "some 
people must be allowed to get rich first" was just this - some people 
should be allowed to be billionaires running multi-national companies 
(and still be in the CCP at leadership levels) while 150 million people 
are left as "floating populations" with neither viable land nor stable 
jobs, who can die if they can't afford health care.

What the Vietnamese mean about following China, according to a 
discussion I had a few days ago, was not merely privatising "furniture 
shops", as he disdainfully put the record to date, but privatising the 
mines, the steelworks, cement, fertiliser, chemical industry, oil etc 
etc, the state keeping "a few public services". Then maybe Vietnam will 
be able to achieve an industrial accident rate similar to China's, which 
I believe is probably the highest in the world, probably rivalling South 
Korea at a per capita rate during the height of that country's "miracle" 
development. <<

The Vietnamese cadres’ attraction to the Chinese reforms is 
understandable, as is the likelihood (noted by Michael Karadjis) that 
some Cubans would feel a similar attraction. As we know, the Soviet 
officials most involved in negotiating massive trade deals with the West 
were some of the strongest proponents of perestroika and the market 
reforms that contributed to the collapse of the workers state. Not 
because of trade per se, but because their own "theoretical foundations" 
had little if anything in common with revolutionary internationalism, 
and the naive infatuation of these bureaucrats with capitalist 
prosperity was fostered by a lifestyle that increasingly merged with or 
emulated that of their Western counterparts.

No one in that GLW discussion was arguing that China’s trade with Cuba 
is "sinister", contrary to what Fred Feldman alleges. Still less were 
they arguing that China is "some kind of fearsome enemy power", Fred’s 
allegations notwithstanding. But it would be a mistake to ignore the 
pro-capitalist nature of such Chinese advice to the Cubans — and more 
importantly, the likelihood that some Cuban officials may harbour 
similar views, as Michael Karadjis noted.

Most of Fred’s post (ostensibly and mistakenly directed at me) is an 
attempt to present China’s trade ties with Cuba as proof of its 
"solidarity" with that country; as he puts it, "They are governmental 
expressions of the solidarity that is growing deeper across the 
oppressed nations." Well, there is no doubt that Beijing trades on the 
prestige of the Chinese revolution and exploits it to advantage in its 
relations with third world countries and the few remaining workers 
states like Cuba. But I think it is wrong to portray China’s 
international relations, trade and diplomatic alike, as motivated 
primarily by "solidarity" with anti-imperialist movements and 
governments. In fact, as Fred knows, there are many instances throughout 
China’s post-1949 history when it sided with counter-revolutionary 
governments, and even with imperialist powers, in the interests of 
Beijing’s narrow diplomatic interests. China today has some perfectly 
valid, non-revolutionary reasons to trade with as many countries as it 

Fred says he thinks the Chinese revolution "has not been ended or 
definitively rolled back". But his evidence for this proposition is very 
sparse, to say the least. (I’ll leave aside the article he cited from 
the U.S. SWP’s The Militant, which simply proves that Washington fears 
China as a potential rival, irrespective of its social system.) He cites 
"the progressive character of China’s fight for Taiwan" as an example, 
saying it represents a "course toward completing the national 
unification of China". Although I profess no particular knowledge of the 
Taiwanese question, I find this reasoning highly dubious. Taiwan was 
long a part of China, and torn from it by the counter-revolutionary 
Kuomintang forces in 1949. Capitalist Taiwan’s "independence" has long 
been used by the imperialist powers as a battering ram against China and 
its revolution. But Taiwan is not a colony of any foreign power, as Hong 
Kong was. It has been a state in its own right for more than 50 years. 
Do the Taiwanese, as they have evolved, as they exist today, want to 
rejoin China? I honestly don’t know. But I know there is a lot of 
evidence that they don’t want to do so, even if China is now capitalist. 
Isn’t the "fight for Taiwan" just possibly an expression of great Han 
chauvinism in today’s world?

Richard Fidler

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