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Saturday, October 1, 2022

THE DISORDERLY EXPANSION OF CAPITAL #362

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Mr Graham Perry
Graham Perry
Experienced Arbitration Lawyer | China & Chinese Business Affairs | Public Speaker/Lecturer.

GOOD MORNING FROM LONDON

This is a term that regularly appears in Chinese policy statements + yet is little understood in the West.

Capital has to expand so that the economy can continue to grow so that the people can continue to enjoy prosperity. But the expansion of capital cannot become a free-for-all; it cannot shoot off in different directions; it cannot be left to the whim of the market.

So the decisions of the Party and Government need to be balanced between the needs of the economy + the aspirations of the capitalists. In contrast to the old USSR, China does see a role for
Capitalists whose instincts for making profits can be in harmony with the role of the Government in making progress for all the people.

Capitalists bring good news + bad news. They have enterprise, enthusiasm, vision + confidence. They are also selfish, acquisitive and exploitative. The conclusion? The Capitalists have to work within a plan; they have to be regulated; they need to serve the interests of the people over the interests of their class.

Back to the “disorderly expansion of capitalism”. It has two aspects; first, China needs an overall plan of economic development and the national Plan needs to embrace enterprise, initiative, risk and profit, but the second aspect is that Capitalists cannot be unaccountable or be permitted to make key economic decisions without reference to the Plan and the Party. Further, the Capitalists cannot become a rival centre of power within the state. Their progress cannot be achieved by challenging the primary role of the Party and the Government. And this brings us to Jack Ma, the Ant Group and their attempts to set up a power base outside of Government and Party.

In this important sense, capital has to expand inside, and not outside, the Plan

NEXT POST – #363 – 25 FEBRUARY 2022

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