More evidence of class struggle in capitalist China

On 24 July thousands of Chinese steel workers in the north eastern city of Tonghua clashed with police during demonstrations over a proposed take-over deal. It led to the kicking, beating and throwing down stairs to his death of the general manager of the Jianlong Steel Holding Company. This event received more publicity than workers' actions in China usually do, probably because it showed workers' frustrations and desperation rather than their ability to organise themselves or express solidarity for others.

In fact, workers' struggles have been reviving in China as much as other countries because their experience of capitalist exploitation is the same.

Capitalist relations of production

Before turning to an interesting recent report it is worth recalling the basics of workers' lives in China. After all, there are many (on the left and the right) who say that China is ‘socialist' or ‘communist'. There are also some Trotskyists who describe China as a ‘bureaucratically deformed workers' state'. Also available is the view that China was once ‘socialist', or at least ‘progressive', but went downhill with the death of Mao Zedong and the re-emergence of Deng Xiaoping at the end of the 1970s. As we approach the 60th anniversary in October of Mao's proclamation of the establishment of the People's Republic of China, it's worth recalling why there is nothing in this for the working class to celebrate.

Before the 1945-49 civil warbetween the Chinese Communist Party and the Guomingdang there had been, since 1937, in an alliance in the war against Japan in which they both recruited people to die in the interests of their various exploiters.In all parts of the country, including those dominated by the Maoists, strikeswere forbidden as disruptive to the war effort. And when finally the CCP came to dominate the whole country (except Taiwan), far from smashing the Guomingdang state it was incorporated into the stalinist state. After all, the Guomingdang state had already taken over a large part of a number of major industries, so it was entirely fitting that the CCP with its explicitly state capitalist policies should take it over. In contrast to the Guomingdang, which was riddled with widespread corruption and had presided over galloping inflation, the CCP's approach corresponded more closely to the needs of the Chinese national capital.

What needs to be remembered when the '60 glorious years' are being marked is thatthe working class hadn't mobilised itself in defence of its own interests, andthat no new relations of production were introduced by the new government. The working class still sold its labour power for wages, the capitalist state still stood, and it was very common for the existing functionaries to remain in place. As for private businesses, when they were taken over by the state the owner often stayed on as manager.

Above all, it is necessary to forget the ‘socialist' rhetoric of the Chinese ruling class, as it no more corresponds to any reality than does the talk of ‘freedom'a nd ‘humanitarianism' by the bourgeoisie throughout the rest of the world.

The example of the ‘Great Leap Forward' should be enough. This was the name given to the Second Five Year Plan that was due to run from 1958-63. The intention was to reorganise agriculture, but, even when bad weather is taken into account, the famine of 1958-61, in which, in different estimates, between 16 and 50 million people died, was caused by the state's policies. Because of a commitment to industrialisation many crops were left unharvested. Due to a campaign against sparrows there were devastating swarms of locusts. Grain continued to be exported in order to fuel propaganda about the supposed success story of Mao's regime. It was only when exports were stopped and imports increased that the famine began to diminish.

The period of the famine is still officially known as the ‘three years of natural disasters', which was the cause cited by theChinese state for the famine. Since the coming to power of Deng and his factionit has become acceptable in Chinato criticise Mao and some of his policies. What no one says is that the Chinese capitalist state has consistently shown itself as negligent of its subjects as any of the so-called ‘entrepreneur' capitalists with their workers, customers and the planet.

Do you recognise this picture?

China Labour Bulletin is a Hong-Kong based organisation that campaigns for ‘free trade unions' and the enforcement of existing labour laws in China. Although they clearly have their own agenda their material is interesting even if you don't accept their conclusions. Every two years they publish "an in depth study of the workers' movementin China" and in early July they published their third report, Going it Alone: The Workers' Movement in China(2007-2008)

In this latest study they analysea hundred examples of workers' struggles in China over the last two years (involving numbers from "over 40" to "over 10,000" workers to "several hundred" schools and kindergartens) and try to draw out significant trends. Perhaps inevitably theysee the situation as particular to China. What's interesting is how similar is the experience of workers across the world.

For example they report on thegrowing gap between rich and poor. "A wide-ranging survey carried out between May and September 2008 by the Chinese Academy of Social Sciences clearlyshowed that the gap between the richand the poor in China continues to grow. In 2007, the per capita annual household income of the top20 percent of urban and rural residents was 17 times higher than the lowest 20 percent. Average annual household income levels in eastern China [where thefinancial and industrial sectors are concentrated] were 2.03 times higher than in western China, and 1.98 times higher thanin central China.The most pressing concerns cited by respondents to the survey were: ‘rising prices' (63.5 percent), ‘difficulty and cost of getting medical treatment' (42.1 percent) and the ‘excessive income gap' (28 percent)." (Going it Alone ... p6.)

According to the World Wealth Report, compiled by Merrill Lynch and Cap Gemini, there were, at the end of 2007, 414,900 people in China worth more than one million dollars excluding their principal residence. At the end of 2008 "The global recession and local stock market crash caused the number of millionaires to shrink by 12pc to 364,000" (Daily Telegraph 24/6/9.) There are still dozens of billionaires in this reduced total.

Something else that will be familiar to workers everywhere is growing unemployment. Officially there are about seven million people out of work, with a government figure of 4.3% for urban unemployment (this figure does not include migrantworkers or graduates). Most analysts believe the real total is much higher. Asthe CLB report says: "In February 2009,Chen Xiwen, director of the office of the Central Leading Group on Rural Work, revealed the results of an extensive survey of 15 migrant worker-exporting provinces, which estimated that 15.3 percent or 20 million of China's 130million migrant workers had lost their jobs in the previous year" (Going It Alone ...p5)

Earlierthis year the Washington Post (13/1/9) came up with somesimilar figures "Unemployment is now estimated to be at its highest levels since the Communist Party took over in1949. Estimates by government research agencies for urban jobless top 18million, or 9 percent of the workforce .... This figure doesn't include thegrowing number of jobless among the 160 million migrant workers who are mostly employed in factories. The rural unemployment rate could be as high as 20 percent. In addition, 1 million college graduates are not expected to be able to find jobs this year."

More recently Wang Yadong, a senior official at the Ministry of Human Resources and Social Security's employment section said that "China's current employment situationis still grave and the pressure for job creation remains large" (AFP4/8/9). Quoting the official figures (and, remember this is the government that claims to have made a profit from the Olympics) "Wang said around 147 million migrant workers had moved to cities forjobs by June but more than 4 million had yet to find one" (ibid.) This figure is on top of the millions who have already had to return home "Moreover, 3 million university graduates, including those who had left last year, were still unemployed" (ibid) -thus showing that previous predictions were too optimistic.

The reason that the state saysthat the situation is "grave" is simple. The "Chinese authorities fear that rising unemployment could provoke unrest in the country" (ibid).In fact they've already got it.

‘Mass incidents' and individual protests

Going It Alone refers to an article that appeared earlier this year. "The Hong Kong-based political magazine Cheng Ming quoted senior Party sources as saying the number of mass incidents in 2008 was 127,467, almost 50 percent higher than the last officially released figure of 87,000 in 2005". A ‘mass incident' can beany strike, demonstration, blockade or other form of struggle that involves ahundred or more people. In the first three months of this year there were 58,000 ‘mass incidents'. If this tendency continues 2009 will break the records with more than 230,000 ‘mass incidents'.

One of the strengths of this report is that it has looked at individual struggles and tried to draw out some characteristic tendencies. It's worth quoting whatthey see as three major trends.

"Workers took matters into their own hands. Bypassing thelargely ineffectual official trade union, they used public protest as a means of forcing local governments to intercede on their behalf. And, in many cases,workers were successful.

Strikes ignited other protests in the same region, industryor company subsidiaries. The wave of taxi strikes that swept the county at the end of 2008 exemplified both the spread of industry-wide protests and the willingness of local governments to negotiate with the workers.

Workers' demands became broader and more sophisticated. Previously, disputes were mostly related to clear-cut violations of labour rights, such as the non-payment of wages, overtime and benefits, but in the last two years collective interest-based disputes came to the fore, withworkers seeking higher wages and better working conditions, and protesting arbitrary changes in their employment status and pay scales. One of the major causes of discontent was, for example, attempts by managements to circumvent the new Labour Contract Law by forcing employees to relinquish long-term contracts and rejoin the company on short-term contracts or as temporary labour."

Some of these tendencies are to be found elsewhere in working class struggles. What is different is the "Labour Contract Law", not in what it does, worsening workers' conditions (along with other recent legislation), but in how it has become afocus for individual or small groups of workers. In the New York Times (22/6/9) you could read "Workers are fighting back. Earlier this month, the government said Chinese courts were trying to cope with a soaring number of labor disputes, apparently from workers emboldened by the promise of the new contract labor law.

The number of labor disputes in China doubled to 693,000 in 2008, the first year the law was in effect, and are rising sharply this year, the government says."

These disputes are individual wrangles, a diversion from the potential of collective struggle. It's not as though there's not plenty to fight about. As the New York Times article says "A year and a half after a landmark labor law took effect in China, experts say conditions have actually deteriorated in southern China's export-oriented factories, which produce many of America's less expensive retail goods.

With China's exports reeling and unemployment rising because of the global slowdown, there is growing evidence that factories are ignoring or evading the new law" (ibid.)

As the CLB report put it "Even after the implementation of the Labour Contract Law on 1 January 2008, companies were still blatantly flouting the law or using underhand methods to circumvent it. A survey of more than 300 workers conducted by the Dagongzhe Migrant Workers Centre in Shenzhen showed that unscrupulous employers would provide workers with contracts in English rather than Chinese, force them to sign two separate ones or documents with two different company seals, or use other devious tricks to get around the provisions of the law. Employers also raised dormitory and food costs and increased penalties for turning up to work late and other violations of company rules. The survey showed that 26.6 percent of workers still did not have a contract, and that 28 percent of contracts offered wages lower than the legal minimum. Nearly two thirds of the workers interviewed said they had to work longer than the hours stated in their contract. And according to the Ministry of Human Resources, in China as awhole, in 2008, some 15.6 million workers lacked labour contracts." (Going It Alone...p11.)

The analysis in the report is straightforward. "The unprecedented wave of labour legislation in this period was no accident. It was a direct response to the pressure exerted by the workers' movement over the previous decade. A government committed to maintaining social order and harmony could no longer afford to ignore the strikes and protests staged by workers on an almost daily basis across the country" (ibid p13.)

The CLB think that all the labour legislation is a good thing, when, in reality, it provides a false focus for workers' energies. Fortunately, as they show themselves, workers have found many other ways of expressing their discontent.

A need for an end to illusions

The causes of the struggles studied were quite clear. "More than a third of the cases (at least 36) related to clear violations of legal rights, such as the non-payment of wages, overtime or social insurance contributions, or the failure to pay the compensation prescribed by law after the termination of employment contracts."

"However, in another third (at least 35) of the cases, workers did not simply seek redress for rights violations; they demanded higher wages, improved final severance packages from SOEs [state-owned enterprises], shorter working hours, improved welfare benefits and reductions in workload. Some retired and laid-off workers sought higher retirement payments and basic subsistence allowances.Other disputes arose over proposed changes in employment status, arbitrary changes to working conditions, meals and housing allowances, as well as demands for government investigations into alleged management malpractice during the restructuring of state-owned enterprises" (ibid 14/15.)

With the impact of the recession on China's export industries, unpaid wage arrears and no compensation for being laid off are common. "In China's manufacturing heartland, Dongguan, there were 117 incidents in September and October alone of factories closing and the boss running away, leaving at least 20,000 workers without pay" (ibid p15.)

Factory closures have shown the sharp dealing of the bourgeoisie and the expression of workers' anger.

"On 9 November 2007, several hundred workersat Nicewell Ceramics' Guangzhou plant blocked roads near local government buildings to protest wage arrears ofmore than two million yuan. Two days earlier, the chairman of the Taiwan-based parent company had informed the city government that he had been forced by "gangsters" to flee the idled plant.

On 13 February 2008, more than 250 workers at the Lichang Shoe Industries factory in Panyu blocked the Luoxi Bridge after the plant was closed and the manager absconded, leaving wages and social insurance contributions unpaid. According to workers, before the Chinese New Year holiday, the manager tricked workers by telling them to return to work after the holiday. When they did, they discovered he had disappeared with the cash box.

More than 1,000 worker sat the Chunyu Textiles factory in Wujiang city, Jiangsu, blockaded an expressway on 27 October 2008 after themanager fled abroad, leaving employees with four months' wages unpaid. The company had been crippled by debts but rather than go through formal bankruptcy proceedings which would have given workers some protection, the boss elected to simply run away" (ibid p15/16.)

Although these examples used road blocks, the report also includes examples of strikes, occupations, marches and other forms of struggle and protest.

With all strikes there is the curious question of their legality. "The right to strike was removed from the PRC Constitution in 1982, ten years before the advent of the ‘socialist market economy,' on the grounds that it was not necessary under China's socialist system. Since then the status of strikes in China has been a legal grey area - they are neither legal nor illegal" (ibid p22.)

The ‘right to strike' is a bit like the minimum wage. "The minimum wage was introduced in China in 2003, but it has rarely represented a decent or living wage, and at the end of 2008, minimum wages across the country were frozen in response to the global economic crisis" (ibid p15.)

If the status of strikes is unclear the response of the state is not. "Police intervened in at least 61 of the 100 cases reviewed here. On occasion, police action sufficed to temporarily stifle workers' anger and prevent escalation, but it often created more tension and ultimately led to violence. In at least 19 incidents, there were physical clashes between protesters andpolice, and some workers and police officers were injured" (ibid p24.)

The report gives some examples of violence against workers. "On 15 January 2008, Wang Chao, a migrant worker from Sichuan had an arm chopped off by thugs armed with knives and steel rods, hired by a state-owned construction company in Nanjing to attack workers' representatives when they sought payment of wage arrears. Wang was taken to hospital just in time for re-connective surgery" (ibid p26.)

"On 4 January 2007, workers at the notorious Italian-owned DeCoro furniture factory in Shenzhen staged several protests after the company announced relocation plans. Management only allowed employees to stay on if they accepted a 20 percent pay cut. The plant had witnessed numerous protests in the past, such as in November 2005, when some 3,000 employees struck inprotest at the beating of workers' representatives who asked the Italian managers for an audit of wages" (ibid p16).

"When claiming their wages for several months' work at a food processing plant on the coast of Shandong inearly July 2008, a group of migrant workers from Henan were surrounded and threatened by factory security guards and local gangsters. One of the workers was beaten and threatened with a knife. In an interview with CLB Director HanDongfang, one of the workers said that at this point, the factory boss yelled: ‘Kill him! Kill him! Kill him and bury him here! Make sure that not one of them gets out of here, forget about their wages. Don't be afraid they'll go to court! Just let them go to court. Don't worry about the Labour Bureau, they are all my friends, and failing that we have the provincial governor on our side'" (ibid p26/27.)

As elsewhere in the world, the bourgeoisie knows it has the law and the state onits side.

More positively the CLB report says that "In addition to examining the one hundred cases above, an analysis of the workers' movement in 2007-08 cannot ignore the emergence of widespread industry-specific protests in this period. Two protests, one by middle and primary school teachers, and the other by taxi drivers are particularly noteworthy." They highlight "the way they ebbed and flowed and spread across the country" (ibid p27.)

In the case of the teachers' strikes they "involved several hundred primary and middle schools as well as kindergartens across China. The number protesting rangedfrom several dozen to several thousand, and strikers mainly came from poorer rural areas in Sichuan, Chongqing, Hubei, Hunan, and Shaanxi" (ibid p27.)

In a conclusion the CLB sum up some of their main points "Workers had to cope with galloping inflation in 2007 and mass layoffs in 2008. By the end of the year, an estimated 20 million migrant workers had lost their jobs, while those who retained their positions often had to accept significantly reduced wages as the global economic crisis took its toll on China's export-oriented manufacturers. Although incomes rose overall during this period, so did the gap between the rich and the poor. Economic hardship, social disparity and rampant corruption among local Party and government officials ledto outpourings of anger and resentment across the country" (ibid p45.)

While much of this report gives a good account of examples of the class struggle there is one crucial element missing. The CLB wants to see either the state unions functioning properly or new unions representing the interests of workers. The historical experience of the working class demonstrates that no form of union can any longer fulfil this function. In this report you can see a number of forms of organisation, limited in many ways, but, as CLB's summary ofthe report says "The All-China Federation of Trade Unions (ACFTU), the sole legally mandated trade union, is now seen by the majority of China's workers as irrelevant to their needs, and as such they increasingly take matters into their own hands" (ibid p3.)

The CLB also maintains a confidence in China's labour laws, so long as they are implemented ‘properly'. Ultimately, what they propose is a reform of the state's attitude, alongside the development of ‘proper' unions.

In an article (26/7/9) on the death of the manager in Tonghua the CLB says "The incident at Tonghua reflects the deep anger felt by many employees at China's state-owned enterprises (SOEs) at their treatment during restructuring and privatization. Although the majority of SOEs were privatized in the late 1990s, the after effects are still felt today and many other SOEs, like Tonghua, are still going through the process of restructuring." This ‘restructuring' is forced on the capitalist class by the depth of the international crisis and the need of each national capital to compete on the world market. It makes no difference whether the enterprises are state-owned or privatised.

The experience of the international working class shows that workers should have no illusions in the unions or the rest of the capitalist state or the possibility of the bourgeoisie finding another way of responding to the economic crisis.Workers should have the confidence to "increasingly take matters into their own hands."  Car 5/8/9