The Hammer, Sickle And A Love For Money

An apparent contradiction, Chinese communism has thrived as a market economy situated the most populous country in the world as a rising superpower. But can it last?

- Zigor Aldama

Don’t say “communism” – say “socialism with Chinese characteristics”. That’s the official euphemism to describe China’s apparently contradictory social, political, and economic system: a one-party state with an all-powerful government which controls the judiciary and the National Assembly, and a thriving market economy where rapidly growing private and foreign businesses have to bear off-limits sectors where state-owned enterprises (SOE) benefit from monopoly or oligopoly structures.

It’s also a country where all land belongs to the state, and citizens pay for the right to use that land for 70 years. But, rampant speculation is blowing the property bubble bigger than ever seen before in China’s real estate market. The cocktail is being shaken up: Individualism and consumerism have given the boot to old-fashioned fraternity and collectivism.

“Getting rich is glorious,” Deng Xiaoping said when he decided to get rid of Mao’s most controversial and extreme interpretation of communism, implemented first with the Great Leap Forward (1958–60) and during the Cultural Revolution (1966–76). By 1979, an impoverished China opened its heavy doors to the world.

But not fully. It needed capital and know-how and foreign companies didn’t doubt that for a second: They entered in hordes to explore a cheap manufacturing base and to pioneer their business given the huge potential market for their products. In exchange, China got everything its leaders wanted: Protecting core sectors and enacting laws that required foreign companies to establish themselves in the country with joint ventures was a perfect means of achieving the transfer of technology.