Vol. 72/No. 3      January 21, 2008

Both the Chinese and Soviet regimes were willing to stab the Vietnamese people in the back in return for improved relations and trade with Washington. The workers states in both countries were governed by parasitic bureaucratic castes, and their foreign policy was based on the narrow national interests of the dominant middle-class layer in each country—at the expense of the interests of the working class worldwide.

In the first years of the Chinese revolution, after the establishment of the People’s Republic of China in 1949, the Soviet Union had extended significant economic and technical aid to China. But following the 1956 de-Stalinization campaign by Soviet leader Nikita Khrushchev—in which a fraction of the crimes of Joseph Stalin were exposed but his counterrevolutionary policies maintained—Beijing took its distance from Moscow. Mao felt threatened by the campaign against the Stalin cult, fearing it could threaten his own standing, which was based partly on a personality cult.

The disputes between the two governments became public in 1960, when the Soviet Union ended all economic aid and trade with China, a big blow to the Chinese toilers.

The Maoist regime initially attacked Moscow from the left, condemning as counterrevolutionary the Moscow Stalinists’ call for “peaceful coexistence” with imperialism. But it rapidly became clear that Beijing’s bureaucratic rivalry with Moscow was in line with its own course of collaborating with U.S. imperialism.

In 1973 the Chinese Communist Party (CCP) declared—falsely—that capitalism had been restored in the Soviet Union and a “fascist dictatorship” was in power there. Mao became a fervent supporter of NATO as a means to restrain Soviet “social imperialism,” which he called the greatest threat to world peace, greater than Washington. Beijing established friendly relations with some of the most hated U.S.-backed regimes in the world, from the shah of Iran to Joseph Mobutu in Zaire to Augusto Pinochet in Chile.  
 
‘Gang of Four’
Following Mao’s death in 1976, the faction he had led was quickly deposed. Four of his closest collaborators, including his wife Chiang Ching, were arrested. In a repeat of the factional thuggery Mao had dispensed against his opponents during the Cultural Revolution, his now-dominant rivals went on a public campaign to blame all the problems Stalinism had introduced on the “Gang of Four.” Wall posters bearing slogans like “Crush the heads of the four dogs” went up all over the country.

When the dust finally settled from this latest factional battle, one of the former leaders Mao had deposed during the Cultural Revolution, Deng Xiaoping, re-emerged as the new head of state. (See last week’s article for a description of the Cultural Revolution.)

Deng deepened the policy of currying favor with Washington. One of the most criminal acts of the Chinese bureaucracy during this period was Beijing’s invasion of Vietnam in early 1979. The Vietnamese workers and peasants had defeated U.S. forces in 1975, forcing them to withdraw from Vietnam. Popular mobilizations of the Vietnamese toilers over the next years led to the overturn of capitalism in southern Vietnam in 1978 and the forging of a single, unified workers state.

Instead of extending solidarity, China cut off economic aid to Vietnam and began massing troops on that country’s northern border. In December 1978 and January 1979, Vietnamese troops came to the aid of the people of neighboring Cambodia in ousting Pol Pot’s hated Khmer Rouge dictatorship. That’s when the Chinese bureaucracy decided to invade Vietnam, trying to help Washington push back advances for the socialist revolution in Southeast Asia.  
 
‘Market socialism’
In the late 1970s the Deng leadership reversed the policies of forced collectivization carried out by Mao and embarked on a course of increased reliance on capitalist market methods that bred new inequalities and class differentiation.

The land that had been collectives or cooperatives was divided up among the families that worked it. The government significantly raised the prices it paid for peasants’ produce and permitted them to sell part of their product on the market, promoting the development of wealthy farmers. Deng’s slogan was, “To get rich is glorious.”

Rural factories, some owned by individuals, were built and by 1989 they employed 90 million workers.

In 1979 the regime expanded the number of peddlers, small businesses, and capitalist enterprises allowed to operate in the cities. State-run factories, which had previously turned over to the government all surpluses, were now allowed to keep the surplus after paying a 55 percent tax.

Four special zones were established in Chinese coastal areas where foreign capitalists could set up businesses. In one of these, Shenzhen, there were more than 1,000 capitalist businesses by 1982. By 1989 there were more than 7,000 joint ventures with U.S., Japanese, West German, and other companies. Chinese exports soared and the country experienced 10 percent growth rates each year from 1978 to 1988. Washington had extended diplomatic recognition to Beijing Jan. 1, 1979, as the U.S. rulers realized they were missing out on a giant opportunity to profit off the exploitation of Chinese labor.

Initially these developments meant higher incomes and greater consumption for many working people. But over time, the greater use of capitalist methods began to increase social inequalities and class differentiation. The shift to market methods in the countryside increasingly disrupted agriculture. The government sharply reduced its investment in agriculture. Farmers sought to plant whatever would make the most on the market. Production of basic food crops went down.  
 
Unemployment and inflation rise
Over time, unemployment increased in the rural factories and on the land. Millions moved to the cities in hopes of finding work. By the end of the 1980s inflation rose to as much as 50 percent a year, its highest levels since 1949.

Culturally, China began to go backward. The number of students in secondary school declined and only 1 percent went on to college, compared to 9 percent in India and 20 percent in south Korea.

The sharp deterioration of living standards for many working people stood in contrast to the growth of a very wealthy layer of government officials and factory owners.

The accumulating social discontent in China exploded in 1989. Hundreds of thousands of students, joined by young workers, marched in major cities to demand democratic rights, more spending on education, and an end to government corruption.

In Beijing crowds of up to one million converged on Tiananmen Square in May. Several thousand students began a hunger strike.

On June 3 and 4, Chinese troops attacked the huge crowd, killing hundreds, if not thousands, in what became known as the Tiananmen Square massacre. In the weeks that followed many thousands, including workers, protested the killings. In Shanghai, at least half the workforce went on strike and joined the protests.

The Tiananmen Square events were a harbinger of the class conflicts that are brewing in China today. The subsequent developments there will be the subject of the final article in this series.

Link to third article in series