Hegel Boot Camp and grappling with Reason

On Mike Roberts's blog The Next Recession (arguing that the most important factor driving the current crisis in capitalism is the tendential fall in the rate of profit/LTRFP), there is a lively discussion in progress taking its starting point in the misrepresentations of Marx and his ideas perpetrated by Marxists without Marx such as Michael Heinrich and his sponsors the Monthly Review group. The discussion has ranged well beyond Heinrich and his shallow work and moved on to important differences between serious Marxist economists. These differences include the approach to fundamentals of scientific inquiry, which induced me to make the following proposal for a Hegel Boot Camp to bring all would-be Marxists up to speed on the Hegelian foundations of Marx's work:

Well, I’d like to send everybody here on a summer boot camp to work through Hegel’s Logic together.

Programme:
Prepare by reading the lot — Part One, Objective Logic, Book One: Being, Book Two: Essence; Part Two, Subjective Logic: The Concept.

Daily routine: participants take turns presenting papers in plenum, followed by group sessions. Morning and afternoon same story. Evening free form social hive buzzing over day’s harvest.

Expected course of events:
First week, “Being”: leads up to dissolution of Kant’s mind-forged manacles and Saturday night dance and barbecue round the bonfire of the Antinomies.
Second week, “Essence”: leads up to acknowledgment of contradiction as fundamental and inescapable ground of knowledge, thought and being. Dissolution of “induction” as a possible source of knowledge ;-)
Third week, “The Concept”: leads up to acknowledgment that Kant’s a priori insight was a damn sight more powerful than he ever imagined ;-) , and that Hegel didn’t exactly stand him on his feet regarding this but rather blew open the gates of concrete and steel that he misused the antinomies to construct in the path of scientific and philosophical inquiry.
Fourth week, Science and Philosophy: papers and discussion on Anti-Dühring, Dialectics of Nature, Empirio-Criticism, and free choice topics. Purpose: to digest general methodological consequences of weeks one to three.
Fifth and final week, Economics and Politics: “Capital” and Marx’s and Engels’s trajectory from the 1840s using the methodological foundations and consequences thrashed out previously.

After such a learning experience our present discussion would be much less of a mess. Fewer misunderstandings and grabbing the wrong end of sticks. Because everyone would have a much better grasp of criteria for scientific validity in general, and of Marx’s understanding of scientific procedure in particular.

For instance, we wouldn’t be sloshing around in the dark in an Arctic quagmire trying to wallop each other with cudgels labelled “induction” or “inevitability”. We’d have a much better idea of what Marx considered his categories of the theory of capitalism to be, as he presented their unfolding and development from the simplest “cell” of economics, the commodity, into the most advanced organism the capitalist mode of production could generate – the credit system.

There’s a technology of thought as well as machines, and except for a very few exceptions (Boolean logic, for instance) it’s been stagnating since 1848. The suppression of Hegel’s revolutionary advances on Kant, and Marx’s revolutionary advances on Hegel has been much more effective in crushing progress in thought than even the institutional and legal instruments of patents and copyright have been in crushing progress in material technology and culture.

As I’ve written earlier, there’s a difference between the collapse of capital as a mechanism of production and circulation (the immanent, ideal, “mathematical”, pure, deductive, theoretical, whatever aspect) and the collapse of capitalism as a social formation, a mode of production. Capital is a process involving dead elements of completed labour. Capitalism is a social formation composed of living human producers caught up in the capital process. Living labour trying to orient itself and navigate a violent ocean using alien instruments in a ship it has been forced to build to an alien design.

The better we understand the design of this ship Capital, and the currents swirling under it, and the strengths and weaknesses of its boiler and hull, and the way it is being sailed, the easier it is for us to mutiny, seize it and expel the capitalists from the bridge, sail it into calmer waters, and carry out a complete refit to our own design for our own ends.

This discussion is not just about Economics, it’s not even just about Political Economy. It’s about understanding political economy in the context of human society and history in general. And while digging into what Marx actually wrote is a sine qua non for being able to do this, and consequently a huge benefit emerging from this discussion of Heinrich and his distortions of what Marx actually wrote, we mustn’t stop there or we’ll just end up being so many clever dick Jack Horners admiring the plums our thumbs have pulled out of the pudding and pie. We have to understand why he wrote it, and how he was able to write it, and in what circumstances, both material and immaterial.

This is the challenge of social-historical practice, of thinking politics, and it is the challenge that would make our Hegel boot camp into a more exciting intellectual experience than most of us might imagine. Hegel is no agnostic, unlike Kant. He is after the Truth and won’t rest till he can grasp it, judging the correlation between ideas, reality and experience. And once you are in the hunt for the truth, you’re hooked: “das einzig konsequente Mittel gegen die Vernunft ist, sich mit ihr gar nicht einzulassen” (“the only consistent way to fight reason is not to engage with her at all”).

Andrew Kliman was good enough to comment on this:

I don’t think Morph’s comments sufficiently appreciate the differences between (a) philosophical knowledge of the kind that Hegel sought, (b) the kind of knowledge that Marx understood the LTFRP as providing, and (c) what people are engaged in when they make inductive inferences, which is not knowledge-acquisition. AFAICS, Hegel was saying that philosophy needed its own methods, not that other methods are incorrect in their own spheres.

and I responded:

Thanks for “engaging with reason” ;-)  We shouldn’t forget that our Reason is not just thundering in revolt, but is also Red in tooth and claw!
Hegel was concerned with the processes of thought and logic in relation to the truth. The energy with which he explored the foundations of every element involved in this is unexampled – his intensity is on a par with Marx’s and I’m not exaggerating. But it was a different field and more in thought than reality – although once he came to a conclusion he applied what he had learned in more applied fields of knowledge. So I think Andrew K needs to be more specific about “philosophical knowledge” before we can start comparing. But let’s say that Hegel sought the ultimate foundations of knowledge, continuing and developing Kant’s almost equally ferocious and dedicated drive in the same direction.
We can’t single out Marx’s view of the place of the LTFRP and compare it to this. We have to see it in its place in the totality of Marx’s public work, both intellectual and political to make a fair comparison. Marx tackled the whole of Western Philosophy head on as a student, as we know from his doctoral thesis among other things, and came to the conclusion that Hegel, using the whole of this tradition, had found the ultimate foundations of knowledge as far as they could be discovered using an idealist perspective. From then on Marx applied himself to continuing and developing Hegel’s revolutionary work on a materialist basis – the dialectical aspect of Marx’s work coming in from Hegel’s fundamental solutions of the problems of thought, which Marx had no reason to reject or modify, except as regards their roots in the spirit. We know this from his comments in the correspondence with Engels regarding the use he made of Hegel’s logic. (And as we also know, Marx never regarded anything as correct unless it arose from first principles, and he applied first principles everywhere and always, with a speed and sure-handedness that comes from long practice that makes it hard to spot sometimes).
So Andrew’s distinction between Marx/LTFRP and Hegel’s search for philosophical knowledge doesn’t really hold water. Marx was criticizing a whole mode of production, a whole civilization, and this is a very general agenda that has clear parallels with Hegel’s criticism of all hitherto practised philosophy, especially given Hegel’s extremely broad and inclusive view of philosophy as including thought and human practice – maybe I should have mentioned the Phenomenology or brought it in as part of the preparatory reading for my boot camp to make this clear.
As for inductive inferences not being knowledge acquisition this is nothing but verbal wand-play. I brought in induction in a slighting (not sleighting ;-) ) way because all induction is based on principles and axioms that can only be teased out deductively. This is the inescapable a priori of thought so to say, the revolutionary insight Hegel acknowledged in Kant, and an insight that freed up Marx to pursue such a ferociously (again) deductive method in his study of capital.
We could compare it to the gravitational power of a black hole – the deductive theoretical black hole of Capital centred on the commodity and the value theory sucking astronomical quantities of inductive empirical material into its orbit (eg the material on the 10-hours day, primitive capitalist accumulation and all the parliamentary Blue Books). Only I won’t, because we’d have to invert the whole metaphor and turn a black abysmal Inferno of a black hole into a Paradiso of clarity and light.

"Embodied Cognition" -- empirio-criticism rides again

An article in Scientific American on "Embodied Cognition" prompted a commenter to declare: "The phrase "embodied simulation" is confusing." I agreed and added the following comment as a rider to a previous comment I made referring to Lenin's book on empirio-criticism:

jayjacobus is right about the confusion. There's an interplay between reality and perception of it, and perception itself is a reality, so we have perceptions of perception. It's like consciousness and self-consciousness, and this relationship has been a central problem for philosophy. One of the most primitive responses has been to invent a previous cause, and stop the infinite regression by calling some given cause final or ultimate or prime or whatever. This "embodied simulation" nonsense is the same kind of thing - what it doesn't do is answer the question of reality, ie what is being simulated.
This is a philosophical perpetuum mobile that pretends it isn't. 
Now Kant was smart, so he stopped his infinite regression pain by claiming that the ultimate ground for everything was ultimately unknowable, which was the agnostic thing to do. Hegel was smarter but far less diplomatic, and said "look, reality and our perception of it is full of contradictions, live with it", and moved beyond Kant, opening the way for Marx to move beyond the whole supernatural 'perception/consciousness/thought first' approach. 
For empirical beings, we are very attached to abstract ideas. The reason is simple - we process continuous empirical reality including ourselves using discrete abstract reflections of it in thought. So if you want to call this processing 'simulation', be my guest. Ditto if you want to be empirical by calling it 'embodied'. Well done. Which leaves us as bodies that think. Square one.
Moving in a world of discrete, abstract reflection our mirror minds naturally assume everything is discrete and abstract as soon as it thinks about it, except that the basic presupposition for our survival in reality is concrete continuity. And since survival is opportunistic and iconoclastic, we survive in reality at the expense of broken intellectual dogma, icons and fetishes. 
This drama is entertainingly embodied for me in Lucretius's great Latin poem On the Nature of Things (De rerum natura), and in Hegel's two great works The Phenomenology of the Spirit and The Science of Logic. These are guaranteed pre-Marxist so clear of any ideological tarring and feathering that anything written after 1848 might risk. For a scientific mind they are immensely rewarding, and even a short dip is very invigorating!

Market failure, creativity, and online gouging

Cory Doctorow has written an article in the Guardian entitled "Just because everything has value doesn't mean it has a price". Cory Doctorow: Charging for everything kills creativity About the implications of charging for every little bit of imagined use that can be extracted from an online offering. It's part of a series called "Digital rights, digital wrongs". It's interesting because of its focus on something that capitalism just can't handle, namely "externalities". Better otherwise known as "market failure". His line is that charging for everything will kill creativity.

I commented:

We're back with the problems Marx faced trying to work out the relationship between social production and private appropriation, value, price and profit, and the inadequacies of Adam Smith and Ricardo's attempts to resolve them.
Nothing of value is produced without our labour. So it's natural to expect an equivalent return for it. The problem is a) what is a true equivalent, and b) who will determine this and implement it in society.
Marx resolved the problem of "true equivalence", so problem a) is taken care of. But problem b) is in complete contradiction to the findings of a), since the people determining and implementing equivalence exploit most of us (wage-earners) by creaming off what we produce above and beyond survival (keeping body and soul together at the normal standard of living for our society) and making it their private wealth instead of our shared social wealth.
Cory D ignores this, and ends up arguing for Utopia, since he implies there's a way of accommodating a) with b). This is nonsense, cos ownership is all in our society, and ownership of capital (control of other people's work) is a class monopoly.
This is a pity, cos the main thrust of his argument goes some way along the constructive realistic road discussed seminally by Walter Benjamin in The Work of Art in the Age of Mechanical Reproductionhttp://www.marxists.org/reference/subject/philosophy/works/ge/benjamin.htm
The thing is that the whole of capitalist production today is a market failure. In other words the traditional (or post-traditional, imperialist) market is a useless mechanism for coordinating and eliciting socially useful effort. Market techniques can be very useful in some kinds of distribution, in that they provide spontaneous feedback and self-organization, but they're no good when it comes to deciding social priorities at the limits of resource availability, and they're disastrous in relation to the inevitable necessity of disaster management.
Production and distribution today is a huge social problem worldwide, and some of its most glaring effects are in the realm of ideas and culture. But the solution isn't going to come from economic measures but from political measures that affect the economic foundations of our society.
Till we introduce socialism (non-capitalist ownership and control of production) there will be no solution and Cory will have to keep repeating himself and running on the spot (not to mention the idiots who claim that locking everything down and charging us for the air we breathe is the right way to go).

Some discussions prompted by Einstein's 1949 essay "Why Socialism?"

My translators' discussion list is grappling with some fundamentals of social development and history at the moment. The perspective is lost in a fog of confusion - appalled at the lies and brutality of power in general, especially in the overt cruelty of authoritarian regimes in the small hangers-on of imperialism (like Eritrea, for instance), but unable to differentiate between societies in different stages of historical development (the US versus China versus Cuba, for instance), and totally unwilling to look beyond the limits of bourgeois democracy for a way forward. Totally unwilling to see any difference between the valuable aspects of bourgeois democracy (due process and freedom of association and expression, for instance) and the criminal abuse of power by bourgeois democratic governments who would dearly love to do away with due process and freedom of expression.

PF posted Albert Einstein's excellent essay  Why Socialism? Monthly Review 1, May 1949  to stir the flames a bit. He introduced it with some remarks that reappear later in this post.

The article is quite stunning in its historical context of postwar US paranoia and disbelief in relation to the growth and to the bourgeoisie inexplicable resilience and strength of the non-capitalist world. Written in the year of the victory of the Chinese Revolution in Asia and just a few months before the outbreak of McCarthyism in the USA, it is very simple, very clear, and very restrained. 

I made the following comment. 

The beauty of this beautiful essay is that Einstein starts from first principles. He doesn't argue from authority. He tries to describe the way human society works in terms of things we can see if we look where he points. He mentions one name - Veblen - to emphasize that humanity is still in a "predatory phase" of development. Wealth - in land or goods - goes to those who own the means of producing it, and that ownership is gained and maintained by conquest and coercion, not free voluntary informed consent. 

His goal is a society run by mutually consenting human beings, consciously planned for the benefit of all. 

To achieve this he wants a "free and unhindered discussion of these problems", which was (and still is to a huge extent) "under a powerful taboo". Which is why he agreed to write this essay for the first issue of the Monthly Review.

P, we should note that he doesn't discuss socialism in the terms you start off with - "never been realized", "never been given a chance", "a de facto failure". He discusses it in the terms of how society works when it produces wealth and in its political management of this wealth. He points to factors here that should be redressed if commonly celebrated human and social values are to be upheld. Part of the free and unhindered discussion involves describing the way different societies and mass movements and parties work in relation to these factors. Basically, is a society good, and how? If not, why not and to what degree? If something needs changing, how can this be done? Notice that Einstein doesn't ask if the predatory aspects of society should be changed. He takes that for granted as a matter of first principle - unlike the man he quotes who is indifferent to the well-being and even survival of humanity.

I've got a question. What actual impact can an essay like this have in changing the world (human society) for the better?

 DV raised the issue of central planning. I decided to whack this bogey on the nose, even if it's more of a conditioned reflex than a reasoned objection (or perhaps - given the character of the discussion and its context - precisely because it's a thoughtless automatic defence response). I wrote: 

Central planning is what every capitalist applies with extreme rigour within his own sphere of control. Ever heard of "synergy"? That's benefits of central planning. 

If central planning is applied to a whole society, we get the ultimate in synergy. There are no "externalities" distorting social costs in relation to company costs. All the life-cycle and indirect costs of say the automobile or nuclear industries are computed directly within this sphere of production. It makes a big difference to the calculations, and the kind of decisions taken. (This is not quite true, actually, unless "whole society" is the world economy - until we get there, there will be some externalities between different societies.)

Rejecting "central planning" as a communist evil is pure shibboleth. Utterly meaningless. If a single mother refuses to "centrally plan" her resources, she will not only suffer and watch her kids starve, but she'll be attacked viciously by the goons who police the behaviour and morals of poor people.

A central plan decided by free universal participatory democratic means is a good idea.

It should also be obvious by now to everybody that capitalist anarchy (ideologically rigid adherence to NO rational democratic central planning) is a catastrophic failure, that not even capitalists believe in any longer. They all scream out for planning (except the Economist which believes in Adam Smith's hidden hand the way the Archbishop of Canterbury believes in Jesus) - but it's always planning that serves their interests. And as we see in the EU, this is a ludicrous delusion.

Einstein is worth taking seriously.

 D insisted: 

So how to go about centrally planning, to use one specific example, home washing machines?

Or do we centrally decide no one needs their own washing machine, a horrible waste of resources?

Or do we centrally plan creating thousands of competing models?

Or a Ford-style, East German-style, you can have any color you want, as long as it is black?

What centralized democratic process can make this specific decision?

How much does my washing machine cost me? How do you determine the price? (You could measure in worker hours, but the number of unit-hours will depend on centrally-planned quantity.)

I think you'll probably steer me towards some vague everything-will-work-out-after-the-revolution answer. I don't need "the" answer. But I would like some idea of how this central planning "could" work in a very specific case.

I responded:

First you see how urgent various things are. Once you've decided priorities together, you get down to tackling them.

And you don't look at the techniques or machines before you look at the problems you have to solve. If you have a big problem (a priority) then you throw it out to be debated and sorted out at meetings, conferences etc at all levels, from street to neighbourhood to workplace to city, region, etc. 

Washing clothes might be such a problem. Brainstorming will have produced preliminary approaches and proposals and perspectives. Water usage, energy consumption, chemicals, health issues, location issues etc will have been considered, and will be thrashed out further.

Assuming a residential area with largish households (4+) and small dwellings it's very likely that a system of communal laundry facilities would be alternative number one. In Rinkeby in Stockholm there's a world-famous laundry facility with dozens of excellent modern machines for fast, efficient washing and drying, generous booking parameters, a cafe, a shop, several attendants, etc. It replaced a system of smaller, reasonably efficient but not very pleasant or friendly laundry rooms, that could get run down and messy and cause conflicts. In addition to such facilities, some heavy-duty washing (sports, work) could be managed by providing on-site laundries.

Assuming there's a case to be made for individual machines (convenience, space, plenty of water and energy) then the task would be designing a range of machines to a range of specifications. For this committees consisting of producers, consumers, etc would thrash out some alternatives. There would quite likely be several machines ready for production - by different producers, in different regions, say - so these could be thrown on a market and consumer choice deployed to whittle things down to a manageable selection. 

It's likely that a lot of consumer requirements could be met by just varying colours on offer for one type of machine. Or variable spin speeds in one machine.

The big thing will be that the process is far less blind than it is today. And since today is secretly socialist under the scabby capitalist skin anyhow, what with planning and consumer/stakeholder consultation in many cases, then the cultural dislocation won't break anyone's neck (еxcept the profiteer's). 

But we really don't have to give orders to freely cooperating people as to how they settle on solutions or decide things. We know how we would like to do it, and our job is to ensure it happens the way we think is best.

Whenever people have been liberated from traditional oppressive constraints regarding how to improve living conditions and make a neighbourhood better to live in, however, the results have always been above expectations - inspirational. Examples like improving the slums in Santiago de Chile under the short-lived Allende regime, for instance, which wasn't even socialist, but liberated an awful lot of creativity and constructive activity on the part of young people. Public hygiene, elementary sewage facilities, literacy campaigns, schooling, public murals...

What far too many "non-political" people worry about as consequences of socialism are as often as not consequences of capitalism. We project our own nightmares on to others - this is the basic situation of US culture today as seen in horror movies, dystopias and the kind of behaviour the films make the bad guys do but that the writers have learnt all about here at home. 

They're also the consequences of the rule of counter-revolutionary thugs who have usurped non-capitalist systems - the Stalinist and Maoist bureaucracies, for instance. Nothing to do with socialism.

Or the antics of bourgeois union leaders (Jimmy Hoffa or whoever) who use classical authoritarian domination strategies to strangle democracy and socialism.

Given the difficulties of preparing for freedom in advance (most people are very empirical and will dismiss the possibility of freedom as utopian until it bites them in the arse) then David's "everything-will-work-out-after-the-revolution" answer is quite likely the most adequate one. I mean, I could carve what I've just written in gilded letters on tablets of stone and insist that everyone obeys me after the revolution, couldn't I? And they all would, wouldn't they :-D

 P returned to his introductory remarks: 

If Einstein is worth taking seriously, then the questions he chooses
to end his essay with are worth taking seriously: "how is it possible, in view 

of the far-reaching centralization of political and economic power, to

prevent bureaucracy from becoming all-powerful and overweening? How
can the rights of the individual be protected and therewith a
democratic counterweight to the power of bureaucracy be assured?"

Your response to this essay passes over these key questions. And from
an empirical point of view, the issues I introduced the essay with,
namely that some argue that socialism has never been practiced and
others that wherever and whenever it has been practiced it has proven
to be a failure are of crucial importance. The question of central
planning is closely related to that of the "centralization of
political and economic power" mentioned by Einstein and also to the
danger of an "all-powerful and overweening" bureaucracy that tramples
the "rights of the individual" also mentioned by Einstein at the close
of his essay.

I wrote: 

Bureaucracies flourish in periods of decline and stagnation, politically speaking. When masses are mobilized and fighting for shared demands, bureaucrats are like fish out of water. So the best answer is to never stop fighting for shared demands. This way those best at fighting for the demands will take the lead (by example, selection, re-selection etc) and bureaucrats will organize things like printing leaflets and handing them out.

If conditions lead to an ebb in mobilization and momentum is lost, then there is a period of conflict between healthy democratic leadership and bureaucratic leadership. This is a sensitive period and we have very very little experience of dealing well with its challenges. 

A classic measure that always works, however, is to make every elected position subject to the right of instant recall. You screw up, you get replaced. An even more powerful measure is to restrict the payment made to elected officials to an average experienced worker's income. Nothing deters careerists more than an absence of privilege and the possibility of being knocked off the ladder.

However, these measures must first be put in place to work. And careerists and bureaucrats hate them, so getting them in place isn't easy. And careerists and bureaucrats work non-stop to dilute or remove them.

In bad times, bureaucrats and careerists will have been in control for ages and their privileges and routines of organizational control will be deeply entrenched. And it is very difficult to make any progress during such periods, of course. 

I did deal with the question of socialism in practice in relation to Einstein's essay. He looks at real-life, currently existing social practice and whether it's acceptable. He thinks it isn't, and needs replacing. Current practice in his essay is overwhelmingly capitalist. The world system. He sees it as systematically coercive and unjust, separating privileged individuals from human society as a whole. For him there is no alternative to abolishing capitalism if we want a just, cooperative society. And socialism is the planned, democratic alternative. Public ownership of land and production, democratic, cooperative planning and work.

We can't just sit back and let others build socialism for us, though. If we don't get stuck in, others will, and their interests will trump ours. 

Above all we can't accept imperialist capitalism as a natural and inevitable condition we have no control over. We make our own history. But not in conditions of our own choosing. Our job is to make our conditions as favourable as possible for realizing our desires. 

Bureaucratic counter-revolutionaries like Stalin and Mao didn't rise to power by magic. Every step they took resulted from a struggle between competing interests and group decisions. Their interests were narrow and not very attractive, and the decisions were all hard fought. It didn't have to happen the way it did.

Today there is a dual challenge facing humanity.

Socially the great challenge is capitalism. Remove it, and society immediately becomes viable and beneficial.

Politically the great challenge is the non-socialist leadership of the great masses of humanity - the working class especially. Remove the Social-Democrats and Stalinists (including Maoists) from the leaderships of labour parties, trade unions, and non-capitalist states, and the strength and energy of the working people will be channelled into removing capitalism.

Einstein was writing about the social challenge above all. If you don't accept the need for a socialist human society there's no point in even considering the political questions relating to bureaucracy and the trampling of human rights. You can whinge about injustice and arrogance etc, but the history of the past seventy years (say since world war 2) shows that you're pissing into the wind for all the good it does.

Next P raised the question of "free lunches" and "getting people to work and live

together without monetary incentives and private ownership".

I continued:

The strong force that binds human society together is the quid-pro-quo. When it comes to producing stuff we need to live, all day every day (and a lot else), the four fundamental formulas of Roman Law hold:

Do, ut des -- I give that you give; 

Do, ut facias -- I give, that you do; 

Facio, ut des -- I do, that you give; and 

Facio, ut facias -- I do, that you do.

If we do something and don't receive an equivalent back, we get extremely pissed off, and can kill people. If someone takes without giving back, the same goes. There is absolutely nothing wishy-washy or fluffy about human interchange when it comes to creating and exchanging wealth (necessities plus surplus). 

Each society has its own norms of value to judge equivalence by, and these norms are rooted in the economic and cultural level of development of society, and its hierarchical structure. They are stronger than most taboos. 

This is why only Marx has been able to grasp the whole process of economics as a system of organizing the production and distribution of wealth from nomadic family groups at the mercy of extreme scarcity and necessity through tribal forms to agriculture and urban civilizations, slavery, feudalism and capitalism, and projecting forwards to socialism. 

This is one of the reasons for calling Marxism scientific socialism. It sees the workings of a mode of production in precisely the most elementary fundamental terms required. Work and reward, in terms of equivalence. In bourgeois society the equivalence is measured in terms of value, more precisely exchange value - the amount of labour expended in society to produce the commodities it needs to consume in order to survive and reproduce itself, and to accumulate. You can't produce more value than the total work done by humanity in a given period of time. If you produce more goods in a given period, they have correspondingly less value each.

Basing himself on insights in Adam Smith and David Ricardo, Marx showed how these fundamentals gave rise to the whole system of capitalist economics - and how the process was irreversibly moving towards its own dissolution. The profit drive spurring capitalist production proved to be a more powerful stimulant to production than the various kinds of greed for power or goods under slavery and feudalism, so the capitalist system outgrew them and swept them aside. And produced productive capital on such a scale that it became impossible to employ it fully and retain a sufficiently high rate of profit to stimulate further investment. Marx knew this, and observed and described the process in the mid-1860s, writing the third volume of Capital. The greater the capital employed, the smaller the rate of profit in any surplus value generated. Remember - the value in a society (economy) is ever and always the total of useful human labour expended. In other words it's damn near constant. The capital used, however, which represents lots of old, used labour (big machines lasting many years) grows and grows. Profit is measured by surplus value in relation to capital. Profit has to shrink. Unless you reduce the capital - by destroying it - which means devaluation or war.

Now, class society has given rise to the bourgeois political set-up - society is run by the bourgeoisie, the capitalist class, in its own interest (maximizing profit) against  the antagonistic interests of the proletariat, the working class (whose main interest is to own what it produces so it is no longer just dependent on selling its ability to work, its labour power, to stay alive).

And since society - always based on the exchange of equivalents - has developed to a point where the profit motive is acting against the interests of humanity as a whole - ie the production and exchange of wealth is deliberately held back by a few to the detriment of the many - a rage is rising in humanity at the violation of the taboos of equivalent exchange. Humanity wants to produce, and it finds itself frustrated - by unemployment, lack of material opportunity, etc - and it wants to exchange its produce for a variety of useful equivalents, in which it is also frustrated. 

However, the rage of the billions of producers (whose labour is being exploited or deliberately prevented) against the tiny percentage of owners of wealth (exploiters and suppressors) runs up against the resistance of these owners, who use their wealth to arm huge forces of killers and slave-drivers against their unarmed class enemy.

And this is where we're at, politically speaking, today.

The bourgeoisie looks very strong, because it is armed to the teeth and because its opponents are unarmed (just watch the news any night - from Greece, say - to see half-a-dozen heavily armed and armoured cops kicking and beating a single unarmed opponent, or in South Africa, shooting unarmed opponents down in cold blood in Marikana). It also has a virtual monopoly on public debate regarding how society works, what justice is, what history is, and so on.

If you consider how much money and how many people and how much effort is expended to keep these mind-forged manacles in place, however, or to keep the lid on the boiling pot to stop it boiling over, you'll agree that the bourgeoisie is getting a very bad deal for its money. So far it has been able to keep the lid on the pressure cooker, just about. But it's less and less a pressure cooker and more and more a huge steel boiler at a power plant that's already glowing red hot and is trembling ominously.

It's about to rupture, historically speaking. You can see the steel bulging and weakening, so to say, in North Africa and the Middle East. Ruptures have previously occurred in other parts of the plant (Russia, 1917, Yugoslavia 1945, China 1949). Cracks have appeared throughout the colonial world since world war 2 - in Africa and Asia in particular. 

Human society cannot operate on a systematic basis of non-equivalence for any great length of time. A greater degree of inequality has regularly been exchanged (after a period of violent change) for one of less apparent inequality. And when this in turn becomes intolerable it in turn is replaced. 

Someone once described Soviet citizens as ferociously egalitarian. I think this applies to the whole of humanity. Not stupidly equal as in "everyone must have one green jacket and two pairs of red jeans", but deeply equal as in "all men and women are born equal", or  "I do my bit, and it helps you. Now you do your bit, so it can help me."

Adam Smith's "invisible hand" represented a tremendous advance of egalitarianism in relation to feudal economic relations. He was part of the Enlightenment's great battle for justice and knowledge and prosperity against the aristocracy and religion. Once the aristocracy and the church were smashed as ruling forces in society, the weaknesses of the Enlightenment bourgeoisie in relation to universal equality became painfully obvious, and the bourgeoisie was no longer the leading force for progress, as became clear in the revolutions of 1848. 

So, all in all, the way to grow past the destruction and crippledom of our present bourgeois society is NOT to think up utopian enclaves of small farmers and craftsmen minding their own business far from the madding crowd. What we need to do is to break the chains binding us as a class. We are like the slaves rowing a galley for some Roman general and slave-owner. If we break our chains we can throw the slave-owner and his slave-drivers overboard (or put them to work alongside us) and take the ship where we want, to do the carrying we need. 

The capitalists have the power, and are abusing it, demeaning us and covering humanity with blood and filth. We need to take this power from them, clean away their mess, and use the power to make ourselves a world of creative abundance. 

 P insisted some more:

the question of bureaucracy and human rights is
the first to be tackled by anyone purporting to build socialism. Every
de facto attempt to build socialism has been a dismal failure

And I wrote:

Unfortunately for your perspective, Paul, these questions are not the first on the agenda of anyone involved in revolutionary upheavals. The first questions are whose side are you on, and what are you doing to defeat the enemy? 

Your questions are important, and grow in importance as the big questions of power and who holds it and for whose benefit are settled. But they are not the first. The documented history of the October Revolution shows that both Lenin and Trotsky were well aware of the dangers for socialism of bureaucratic despotism. But awareness of a problem doesn't automatically translate into capacity to implement a solution. 

The Cheka, and Kronstadt for that matter, are both red herrings in this regard. Presenting your naked throat to an enemy wanting nothing better than to slice through it is not a policy anyone in a life or death struggle will opt for. 

The forces encouraging the growth of bureaucracy and injustice in the Soviet Union after the end of the civil wars and the repulsion of the imperialist invasions were stronger than the forces operating against them. And they led to a bureaucratic victory that instituted a counter-revolutionary regime in the Soviet Union,  despite the non-capitalist economic foundations. Which in turn distorted the development of the revolutionary workers movement in the world. Leading to innumerable defeats in revolutions (China in the late 20s, Germany and Spain in the 30s, Italy, France and Greece in the 40s, Indonesia, Chile, Iran, etc etc) and in particular the distortions in the regimes running the non-capitalist states that were created in China in 1949 and Cuba in 1959. 

The record of de facto non-capitalist societies so far is no indication of any necessary bureaucratic character inherent in any non-capitalist society. The very first thing to note is that none of these de facto societies represents a genuine attempt to build socialism. A non-capitalist economy, yes, a socialist society, no. 

We should at least give a new mode of production as much slack as its immediate predecessor. In the case of socialism, that means capitalism, bourgeois society. In terms of time this would mean roughly a couple of centuries if we take the late medieval city-states of southern Germany and northern Italy as early examples of bourgeois societies. A century hasn't yet passed since 1917.  

The second thing to note is that socialism by generally accepted definition is a worldwide mode of production predicated on a level of production and productivity equal to developed capitalism. We are not there yet, so all non-capitalist states so far have been based on a material foundation inadequate to to socialism. We can speak of proto-socialism, but not socialism as such. It's a bit like expecting a computer using vacuum tubes to perform as well as one using transistors. It can carry out the same operations, sure, but it is slow, inefficient, and frustrating. It doesn't show us what computers are really capable of.

Socialism is the road to the future of humanity. Not seeing this is blinding yourself to the future of humanity. Groping in the dark. And incidentally tying yourself (reluctantly or not, as the case may be) to the coat-tails of imperialist capitalism. In other words flapping around with a close-up view of the Devil's arse.

When did the USSR turn its back on Marxism?

On a discussion list I presented a mainstream of Marxist development this way: "Marx and Engels in the 1840s through the Paris Commune to the October Revolution in 1917 and on to the Left Opposition and Fourth International - it's Bolshevik-Leninist built on rock-solid Marxist (and that's Marx and Engels) foundations".

DV asked me: "So at what point does your allegiance split off (or maintain the true centre) of that line, later in the SU? And why?

And I replied:

The change in the political character of the USSR can be located most simply in the year 1924. Lenin died in January, 1924, and during the year Stalin was able to consolidate his power in the Bolshevik party apparatus, principally by opening the floodgates to new members with interests that were bureaucratic and careerist rather than class-based and socialist. The struggle against this development can be traced in the history of the Left Opposition to Stalin and the bureaucracy, which Trotsky founded in 1923 while Lenin was still alive, albeit incapacitated.

Evidence of healthy working-class socialist internationalism is abundant in the records of the first four Congresses of the Third International (ie before 1924). After 1924 the politics of the Soviet government turn against  all the principles of the Bolshevik party that carried out the October Revolution and led the successful defence of the new non-capitalist workers state against the imperialists and reactionaries of the surrounding world and Old Russia.

The best brief account of the general development can be found in Trotsky's book The Revolution Betrayed (1936)  (http://www.marxists.org/archive/trotsky/1936/revbet/index.htm)

The Stalinist bureaucracy instituted a new regime in the Soviet Union that Trotsky and the Left Opposition characterized as politically counter-revolutionary, although on a non-capitalist economic foundation. In other words, the USSR remained a workers state, but was run by a degenerate and counter-revolutionary regime

The catastrophe of the Nazi capture of power in Germany in 1933, resulting largely from the appalling anti-Marxist leadership provided by the German Communist party following orders from Moscow - Social-Democracy was called the main enemy of the German working class, rather than Nazism - drove Trotsky and his comrades to conclude that the Third International was beyond recovery and led them to prepare the foundation of a new working-class socialist international - the Fourth International. This was achieved in 1938, and the founding document - the Transitional Programme, "The Death Agony of Capitalism" (http://www.marxists.org/archive/trotsky/1938/tp/index.htm)- is the best short presentation of modern Marxist perspectives in the imperialist world after the victories of Stalin and Hitler. That is in a world dominated by counter-revolutionary regimes from the US to the USSR. At the same time as the world was split into two antagonistic economic camps - capitalist-imperialist in the US and Europe, and non-capitalist  (what we could call proto-socialist) in the Soviet Union.

Higher education as public relations

Mary Beard blogged about the Open University's absurd ads for spin doctors.
http://timesonline.typepad.com/dons_life/2012/08/university-publicity.html

I commented:


I think they're just seeing how far they can push us without getting their shins hacked. Or their spins reversed.
There's a more general aspect to this zeitgeist stuff. It ties in with the Romantic dissolution of genre boundaries (exploding in the novel form in the Enlightenment, and culminating in things like Brecht's "epic drama" and Joyce's "poetic novel" last century). For some decades now it's been eroding the boundaries between fiction and documentary (ficumentaries and reality shows etc).
The historical ground for it of course is the dissolution of class (ie rigidly, materially hierarchical) society. The philosophical ground is the transition from analytical to dialectical reason/logic (A equals A, you say? Hmmmm). Living, moving and becoming more than dead, static and either/or.
Which affects us in our everyday lives by making us conscious that we are not just living but being seen to live. And exist in a permanent state of metamorphosis through our interactions. We make ourselves (poesis) not just invent, but make, shape.
Except that society (still rigidly class-determined) is struggling to the death against this change. It might as well struggle against the tide of course, but as a result of its resistance all this is happening but no one is aware of it. ("They do not know it, but they do it", as Marx comments in Capital.)
And examples of it happening are all around us, particularly in the US, the most dialectically contradictory country on earth. Like the focus in schools on shaping yourself in relation to your classwork - oral presentation. You are your image. A company or institution is its perception. Careers and billions in profit depend on this.
And people being what we are, we examine it and make a science out of it, excising all the critical bits on the way.
It's international and damn near universal now, because the social transformation is so delayed. The zeitgeist juice impregnates the whole body of the world system deeper and deeper because of the immense material pressures involved.
So humans are the deliberate synthesis of their social conventions and their innate selves. However, the refusal to grasp what's going on means that the innate self bit - the "poor, bare, forked animal" - is obliterated. What's left is the social self that flatters the system. The "furred robes". But since the times are in a state of chassis the unconscious forces itself on us in the form of nightmare and dystopian imaginings. The emperor's new clothes are both furred robes and dissolved in air, flickering before our eyes like strobe lights.
Which means we get spin doctors and social masseurs and Big Media pushing the Big Lie with the straightest of faces and immense self-importance, while a few brave souls (Chomsky, Wikileaks) are busy trying to slow down the strobe and reveal the emptiness at the heart of the Emerald City, so to speak.
Mary is on the side of the angels here, asking who is managing the light show, and why. So our small, voluntary, blog community is standing up to the huge, professionally funded educational institution, and can point to the rising tide, or at least the rising pressure it is exerting.
The nice thing is that keeping the zeitgeist locked up demands a huge amount of effort and resources. And although it takes resources and effort to liberate it, they are infinitesimal in proportion. This will be evident in some decades when capitalism has disappeared down the plughole and sucked bourgeois society down the drain with it.
In the meantime, the truth is a mighty warrior, and a warm and sexy companion to boot. Blake wrote: "Truth can never be told so as to be understood and not be believed." Which is basically what we're doing as we make and shape ourselves in our opposition to the absurdity and inhumanity of the prophet Gobbledegook and incomprehensible Profit.

A short reading list

On a discussion list DO wrote the following:

"The sapient brain continues to evolve, and teaching methods continue
to improve, but the underlying hypothesis of traditional liberalism
(John Locke & Voltaire), and of Marxism, that the human brain is a
blank slate or general-purpose computer waiting to be programmed or re-
programmed, is biologically preposterous."

And  I replied:

Locke and Voltaire might be liberals (traditional??) but they're not so much philosophers as popularizers. The blank slate thing is the hallmark of mechanical  materialists - empiricists like Hume and a lot of the enlightenment encyclopedians. It has NOTHING WHATEVER to do with Marx's ideas. Stalin's social-darwinism is related to it, of course, but that has NOTHING WHATEVER to do with Marx's ideas, either. D, I think you should take time off from reading folks like Lakoff and dig into the mother lode of modern ideas. For me this means the following short reading list.

Kant:                 Critique of Pure Reason

Hegel:                Phenomenology of the Spirit

                           Science of Logic

Marx:                The German Ideology - part 1, Feuerbach (including the Hegel section)

                           The Grundrisse 

Too skeletal? ;-)

Add before:   

Machiavelli:     The Prince

Hobbes:            Leviathan

Rousseau:        The Social Contract

Include:

Kant:                  Critiques of Practical Reason, and of Judgment

Marx/Engels:   The Communist Manifesto

Engels:               Anti-Dühring

Marx:                 Capital I-III and Theories of Surplus Value

Add afterwards:

Freud:             The Interpretation of Dreams

Lenin:              The State and Revolution

Trotsky:          The Permanent Revolution, and The Revolution Betrayed

Chomsky:       Cartesian Linguistics        

All of them (and the idea of  evolution which I haven't "crystallized" in a single book recommendation cos that shouldn't be necessary) are concerned with ripping away illusion, false appearances, and exposing the real elements and forces at work in our lives and our world. With the possible semi-empiricist exceptions of Hobbes, Rousseau and Kant. Kant in fact going too far the other way and declaring impossible the unveiling of the hidden depths of the Thing-in-Itself. The least empirical hard-nosed empiricist you can imagine :-)

For a light-hearted frame to all this, I'd recommend Lucretius On the Nature of Things 

"Sed tua me virtus tamen et sperata voluptas
Suavis amicitiae quemvis efferre laborem
Suadet et inducit noctes vigilare serenas
Quaerentem dictis quibus et quo carmine demum
Clara tuae possim praepandere lumina menti
Res quibus occultas penitus convisere possis.
Hunc igitur terrorem animi tenebrasque necessest
Non radii solis neque lucida tela diei
Discutiant, sed naturae species ratioque." 

rounded off by Sartre's Critique de la Raison Dialectique.

The alternative? Being consigned in perpetuity to Intellectual Hell - a dim, draughty, library with hard, splintery, rickety chairs, flickering lamps, traffic noise, machines throbbing and whining at unpredictable frequencies and volumes, musty air, moaning twitching whimpering snivelling readers radiating chill not warmth, with inaccessible and scrapy loudspeakers pouring out Stephen Hawkings reading the collected works of Jacques Lacan. For ever.

Cheers

Chops

China is different - but why?

Michael Roberts's latest blog is entitled "Which way for China - part one", and has some interesting ideas to offer. He discusses the following concerns of "mainstream economics":

"Mainstream economics is confused about which way the Chinese economy is going.  Some media and economists reckon Chinese growth is slowing fast from its double-digit pace seen in the last few years and indeed is heading towards a crisis or slump brought on by ‘over-investment’, a reversal of a credit-fuelled property bubble and a spiralling of hidden bad debts in the banking system. On the other hand, some economists reckon that economic growth may be slowing, but the Chinese authorities will be able to engineer a ‘soft landing’ through the easing of credit and financing of the writing-off of debt from cash reserves built up over past years. 

"Behind this debate on the immediate future also lies a debate on whether China can continue to grow fast through investment in industry, infrastructure and more exports or will need to switch to a consumer-led economy that imports more and supplies goods to a ‘rising middle-class’ like advanced capitalist economies supposedly do.  Mainstream economics reckons that this cannot be done without developing a more ‘market-based’ economy i.e. capitalism, because the ‘complexity’ of a consumer society can only work under capitalism and not under ‘heavy-handed’ central planning of government and state industries."

http://thenextrecession.wordpress.com/2012/03/19/which-way-for-china-part-one

I made the following comment:

Yup. China is different. But why?

Given the usual total failure of "mainstream economists" to understand anything, even in the world imperialist system, we can dismiss their explanations as ravings when it comes to general economic principles and long-term economic prospects. So what else is there?

If China was capitalist, it would have stalled and crashed long ago. But if it's not capitalist, what is it?

For my money the answer is more historical and political than economic as such. But an economic inkling can be found in Eugene Preobrazhensky's mid-20s book "The New Economics", which dealt with a similarly contradictory political-economic contradiction - the nascent Soviet Union. He describes the setup as "proto-socialist" and the process involved as "primitive socialist accumulation".

Historically I think we're witnessing the long overdue transition of the world mode of production from capitalism to socialism. This can only be understood in an orthodox Marxist perspective (ie grounded in the analysis of the capitalist system in Capital, based on the Law of Value). Marx views the general development of the forces of production as irreversible, and often enough describes capitalism with a fully formed credit system as having developed as far as it could while still remaining capitalist. Social production had grown so much that private appropriation was nothing but a straitjacket preventing further development, in terms of principle. In other words "capitalism pregnant with socialism", or capitalism negating itself. And Lenin rubbed this in by entitling his book Imperialism - the *ultimate* stage of capitalism. Not so much the "highest so far", but the ultimate ie final.

Which is where the political aspect comes in.

The Soviet example showed that the transformation of the capitalist mode of production into a socialist mode of production doesn't happen peacefully, does happen country by country, and is dependent on conscious political action. It also shows (as is made explicit in Preobrazhensky's book) that there is a long road to travel from a non-capitalist (ie workers) state in one or a number of countries to what we can call a viable socialist state (ie one forming part of a world economy dominated by socialist relations of production.

The USSR also showed that the predictions of mainstream bourgeois economists regarding imminent  collapse were totally wrong. Despite the appalling political regime the system survived for seven decades, having started from next to nothing.

Well, China was able to start its proto-socialist career after three decades of an economically expanding workers state in the USSR, and together with many new non-capitalist states and anti-imperialist states. So we can assume that both historically and economically it has been much less vulnerable than Russia. It had a flying start.

Which brings me to what might be the greatest problem facing us today when it comes to understanding and explaining exactly what makes China tick. One Country, Two Systems. That is, how capitalist is China fundamentally?

How would you approach this problem, Mike?

---

'Waistline' commented on this, just the way a good blog discussion should take place!

"To shift to a comment from one reader concerning their interpretation of Marx, I would suggest a very different interpretation of Marx. It was stated:

“Marx views the general development of the forces of production as irreversible, and often enough describes capitalism with a fully formed credit system as having developed as far as it could while still remaining capitalist. Social production had grown so much that private appropriation was nothing but a straitjacket preventing further development, in terms of principle.”

"Marx speaks of a fetter on production rather than the halting of further expansion and development. In my view “capitalism cannot be pregnant with socialism.” While productive force accumulation is irreversible, this primarily applies to means of production. That is to say society cannot be de-evolved back into manufacturing with the impact of the long history of the industrial revolution somehow being negated. Manufacture as a configuration of means of production evolved from handicraft and these world no longer exist for society to go back to. Negation and sublation do not operate backwards as a law system. In this sense of means of production development, Marx spoke of people never relinquishing what they have won.

"Rather than speak of “social production” in conflict with private appropriation, let’s speak of the quantitative growth of industrial means of production in unity and conflict (contradiction) with their bourgeois – capitalist – integuments. Exactly what production beyond the stage of primitive communism is not inherently social or “social production?”

"A different reading of Marx is possible. The bourgeois mode of commodity production – capitalism – enters its final irresolvable crisis NOT ON THE BASIS OF ITS LAW SYSTEM IMMANENT TO IT. Capital is birthed in contradiction expressed as the primary classes of its productive relations; bourgeois and proletariat. Something else other than the basic classes constituting the mode of production causes capitalism to enter into antagonism. That something else is new means of production, the electronic revolution or as a new generation is starting to describe things; the robot economy. Max “Preface to a Contribution” can be read different than the understanding of previous generations of communist.

"This debate about what constitutes “the limit” of the bourgeois mode of commodity production is old. I believe the solution to the question is that qualitatively new means of production creates a new social organization of labor and brings the old system and classes connected to the old system to antagonism.

"At any rate, I look forward to reading more of this.

"Waistline

and I responded:

Hi Waistline, I should perhaps have written the "socialization" of production rather than "social" production - I thought I covered that by writing that it had grown too much to be developed any further under capitalism. Except maybe in so far as a fully developed baby could keep growing in the womb for months or years after nine months gestation. But this growth is not exactly "development". Everything necessary for a viable child is ready. Capitalist expansion is cannibalistic once a certain stage of development has been reached. Once this ultimate stage is reached - and tendency of the rate of profit to fall gives us a good barometer of this - then there is too much capital for the capitalist system to handle. For the rate of profit to rise, huge amounts of capital need to be rendered unproductive (incapable of producing surplus value). Hence war, the extreme growth of military spending (the ultimate capitalist luxury good), and the obscene expansion of unproductive sectors of the economy (lawyers, advertising, and a myriad other sterile ways of divvying up surplus value), and at the same time the appropriators of surplus value (unpaid labour) need to become fewer and fewer so the profit isn't diluted more than necessary. The contradictions are obvious.
Marx was quite clear about the antagonisms leading to the passing of one mode of production into another, including capitalism into socialism -  they are *all* the product of class struggle. Relations between living people, not between dead things (ie not technology). To claim that new means of production bring about the final crisis of capitalism is a) to ignore the fact that human labour power is a means of production, and b) to fall into the trap of commodity fetishism attributing human qualities (living drives and aspirations) to dead things. Commodity fetishism is one of the most fundamental concepts in Marx, it is crucial to understanding his whole analysis of the capitalist mode of production.
For Marx capitalism was pregnant with socialism in his own time, as is perfectly clear from Capital III -- not only pregnant but overdue. In the 1860s. Lenin just expresses Marx's conclusions with respect to the even more cataclysmic political and economic world of his day. One of Stalin's most appalling theoretical mistakes was to trumpet that Marx only wrote about free competition capitalism. He didn't.
Anyhow, if we don't get clarify the human relationships involved in the Chinese situation, ie the character of the class struggle taking place there, and the relationship between the economic system in China and the rest of the world, we'll be as confused by it as the mainstream economists, and make a very poor job of trying to change things for the benefit of living labour rather than dead capital.
Which is why I'm looking forward to what Mike has to say on this subject.

---

Commenter 'hydeparkspeakers' took the discussion forward with the two following contributions:

First a couple of minor issues.

The NPC is (nominally) the decision making body of ‘the people’ not the leadership, the leadership is vested in the Party hierarchy not in government institutions.
I think the exponential growth rate has to be seen in a longer-term context than the last decade. Why this is important? There are very few countries that have ‘caught up’ and modernized since the 1945, and of those no other country has achieved such a long period of such rapid growth as China has over 30 years. Its developmental growth is in a league of its own in a world-historical sense.

The World Bank, under the influence of Justin Yifu Lin, claims that sustained long term growth is primarily due to the exploitation of comparative advantage, (low cost labour -low capital intensity -export driven growth) backed by strategic support from the state to create the infrastructure to assist the private sector.

The reduction in target GDP for 2012 is not a reaction any newly changed conditions, but corresponds with the reduced GDP targets outlined in the 12th Five Year Plan (FYP) adopted by the NPC in March 2011.

The land sales are not all to private developers, state owned entities buy land off each other, there are various levels of state control over public land assets and a turf war between state owned entities characterizes the root of the land sales system. Only part of this is confrontation between the township and village, the lowest level of the state land hierarchy.
The economic impulse derived from the private purchase of apartments is replaced by state construction of low cost rental apartments in the 12th FYP. Local governments often rent out or sell land use rights (leases) that they acquire at below market rates (at agricultural land-use prices) to attract investment. They themselves also invest in creating the infrastructure for the investors to encourage growth, as meeting targets set by the FYP are the critera for ‘success’ or ‘failure’ of officials.

The infrastructure growth in China, is however, very much a state driven urbanization strategy, it has been compared to the Great Leap Forward, but one that is more or less matched by capacity, unlike its predecessor. Now the question is, will Chinese urbanisation continue to produce a significant growth impetus?

A second and connected question is, can the emulation of infrastructure, development and urbanisation models in the interior of China produce the same dynamics of growth as they have in Eastern China?

It seems to me that the private sector, and foreign capital is following the designs of the state planning system, which at the driving seat of economic growth, having all the key levers of the economy in its hands.

***

The motive forces driving the system determine its systemic characterisation. Any number of circumstances can produce rapid growth, but the specifics of Chinese growth are unique and extraordinary and certainly force the question of its systemic dynamics to the fore.

In think the systemic critera used by the Hungarian theorist Janos Kornai are useful, (regardless of his own view of China, or of Marxism and socialism).

1. What ownership form dominates the commanding heights?
2. Is the coordination system dominated by bureaucratic plan or markets?
3. Is the political regime hostile or friendly to capitalism?

If you study the details I think you will find that:

1. The commanding heights are overwhelmingly in state hands .

2. Factor prices are state determined and the planning system drives the economic dynamic. The five year plan drives the economy, not market forces, and the state economy is mobilised wholesale to attain state objectives.

3. The structure of power systematically favours bureaucratic forces over private forces; repressing private finance, indigenous private enterprise, imposing arbritary taxes, expropriations, and so on, as well as repressing any organised capitalist political opposition.

Although it is true that this is probably the most capitalist tolerant and friendly ‘planned economy’ in history- at present -the state and political regime is not in the hands or the pay of capital.

----

  

I added the following comment giving quotes from Capital to corroborate what I wrote in reply to 'Waistline' about Marx being 'perfectly clear about capitalism being pregnant with socialism':

I think the following quotes from a single short chapter of Capital III (Ch 27 ‘The role of credit in capitalist production’) are necessary to relate this discussion on China to Marx’s historical socio-economic perspective, ie to historical materialism. This chapter is practically ignored in discussions among Marxists, reformist or revolutionary, academic or political. It is however possibly the single most important chapter in III, and the most explosive, as it shows just how far behind Marx we still lag after 150 years – he wrote this before 1867 – and how overripe he considered capitalism to be for the transition to socialism, or as he called it the associated mode of production. Only Lenin in “Imperialism” and Trotsky in “The Revolution Betrayed” have this perspective at the core of their work.

Capital III, Ch 27 The role of credit in capitalist production:

III. Formation of stock companies. Thereby:

2) The capital, which in itself rests on a social mode of production and presupposes a social concentration of means of production and labour-power, is here directly endowed with the form of social capital (capital of directly associated individuals) as distinct from private capital, and its undertakings assume the form of social undertakings as distinct from private undertakings. It is the abolition of capital as private property within the framework of capitalist production itself.

3) [… ] In stock companies the function [of management and administration] is divorced from capital ownership, hence also labour is entirely divorced from ownership of means of production and surplus-labour. This result of the ultimate development of capitalist production is a necessary transitional phase towards the reconversion of capital into the property of producers, although no longer as the private property of the individual producers, but rather as the property of associated producers, as outright social property. On the other hand, the stock company is a transition toward the conversion of all functions in the reproduction process which still remain linked with capitalist property, into mere functions of associated producers, into social functions.

[… ] This is the abolition of the capitalist mode of production within the capitalist mode of production itself, and hence a self-dissolving contradiction, which prima facie represents a mere phase of transition to a new form of production.

IV. Aside from the stock-company business, which represents the abolition of capitalist private industry on the basis of the capitalist system itself and destroys private industry as it expands and invades new spheres of production, credit offers to the individual capitalist; or to one who is regarded a capitalist, absolute control within certain limits over the capital and property of others, and thereby over the labour of others.[3] The control over social capital, not the individual capital of his own, gives him control of social labour. […C]entralisation of capital, […] expropriation on the most enormous scale. Expropriation extends here from the direct producers to the smaller and the medium-sized capitalists themselves. It is the point of departure for the capitalist mode of production; its accomplishment is the goal of this production. In the last instance, it aims at the expropriation of the means of production from all individuals. With the development of social production the means of production cease to be means of private production and products of private production, and can thereafter be only means of production in the hands of associated producers, i.e., the latter’s social property, much as they are their social products.

[…] The co-operative factories of the labourers themselves […] show how a new mode of production naturally grows out of an old one, when the development of the material forces of production and of the corresponding forms of social production have reached a particular stage. […] The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other.

So far we have considered the development of the credit system — and the implicit latent abolition of capitalist property — […]

[…] the credit system accelerates the material development of the productive forces and the establishment of the world-market. It is the historical mission of the capitalist system of production to raise these material foundations of the new mode of production to a certain degree of perfection. At the same time credit accelerates the violent eruptions of this contradiction — crises — and thereby the elements of disintegration of the old mode of production.

The two characteristics immanent in the credit system are, on the one hand, […] to reduce more and more the number of the few who exploit the social wealth; on the other hand, to constitute the form of transition to a new mode of production.

In response to Waistline I wrote: “For Marx capitalism was pregnant with socialism in his own time, as is perfectly clear from Capital III — not only pregnant but overdue.” As the quotes show, this is a gross understatement. He is not just ‘perfectly clear’, but he hammers the point home. Bang, bang, bang, bang. Count the number of times he uses the term ‘mode of production’. And note his explicit location of it in the context of transition from an old, worn-out mode of production — capitalism — to a new and superior mode of production of associated producers.