[Book] China: From Permanent Revolution to Counter-Revolution

A New Chinese Working Class

16.1 Introduction

In 2014 the number of mobile phones in use exceeded the world’s population, and about half of them were produced in the Chinese coastal province of Guangdong. This ‘Made in China’ phenomenon is based on the highest level of human migration in history, the movement of hundreds of millions of poor peasants from the interior of China to the coastal regions to work in ultra-modern factories catering for a multinational market.[1]

The Chinese economic miracle was created by the sweat and sacrifice of peasants and workers, but average real wages, compared to the 1950s when the giant SOEs dominated the economy, have fallen considerably. Tens of millions of jobs have been lost in the SOEs, jobs which had been seen as secure for life and carried pensions, health care and housing allowances. A so-called “rust belt” has appeared across the traditional industrial areas, such as the North East, the heartland of China’s old state plan as many loss-making SOEs, both factories and mines, were rationalised for privatisation – an ongoing process.

The majority of Chinese workers are now predominantly low-paid, short-term migrants working in giant high-tech factories. They have little or no job security, and do not receive the welfare benefits that their predecessors in heavy industry had enjoyed. Since the mid-1990s company retirement pensions have largely disappeared, health services have been privatised and moved out of the reach of many, housing has been privatised and the rents being extracted from the workers are a major source of capital for financing factory expansion. Many of the gains of the 1949 revolution have simply evaporated.

16.2 The Making of a New Working Class

In China, a vast working class has been assembled with startling rapidity, most visibly in the three great regions of industrialisation: the Pearl River delta (Guangdong), the Yangtze River delta (Shanghai region), and the Yellow River valley (Beijing–Tianjin). There has been a feminisation of the workforce; female labour plays a leading, even dominant, role in the new proletariat, forming 60 to 70% of factory workers, many of whom are housed in on-site company dormitories. These women are better educated than their mothers and grandmothers. They are more aware of their rights and in the labour-intensive factories of the SEZs, stereotypes of female passivity are breaking down.

China’s cities are growing at an unprecedented rate. In 2013 it was estimated that for the first time, over half of China’s 1.4 billion people lived in towns and cities.[2] By 2030 it is estimated that there could be as many as 1 billion urban dwellers; over 200 cities with populations of more than 1 million, compared with 35 such cities in Europe. To meet this projected growth there are 40,000,000 construction workers.

This degree of urbanisation is unprecedented and it has brought into existence the largest and most powerful proletariat in history. With the massive development of the productive forces comes an enormous strengthening of the working class. The economic development raised living standards for many, incoming peasants were prepared to do the worst jobs and live in terrible conditions because they received an income of at least twice what they would be paid working the land, and were able to remit some money to their dependents. This improvement in living standards for hundreds of millions of people was the major factor in the easy victory of the pro-capitalist wing in the CCP.[3]

We are witnessing the creation of millions of the ‘gravediggers’ of capitalism, a new mass proletariat. What has been happening in China has some striking similarities with the early development of capitalism in Russia over one hundred years ago, but on a much larger scale. Then, the growth of industry brought into being a fresh proletariat made up of peasants who had abandoned the land. Although a terrible price was paid, a mass proletariat was created that would lead the October Revolution. Today the conditions are being created in China for future class conflicts that will inevitably lead to a revolutionary upheaval.

The storm clouds are gathering. China faces serious and inter-linked problems. Firstly, as a UK Government report[4] on the Chinese economy points out, the total number of migrant workers may be at its highest level ever, about 274 million, but the rate of growth has been declining such that today it is virtually zero. There has been a marked change in the destinations of these migrants, more and more are looking for work in smaller cities closer to home because of the discrimination they experience in the larger cities under the infamous hukou system (see Section 16.3 below). It is to overcome this problem and tap into new sources of labour power that huge investment is now being poured into creating factories in inland China.

Secondly, China’s economic growth for 2014 was 7.4%, and the IMF projects a growth rate of 6.8% for 2015 and 6.5% in 2016.[5] This is serious because to successfully maintain present standards of living and employment levels, to sustain social stability, a continued economic growth of 7-10% for the next decade or two is a necessity.[6] Thirdly, this decline is taking place when global economic growth for 2015 will be the lowest since the recession year of 2009, and prospects for 2016 do not appear much better – due to China’s own slowdown.

The first generation of migrant workers moved from the countryside to work in the new SEZs of south China in the 1980s and 1990s. These were mostly female workers who came to work in electronic and toy factories in the first SEZ, the Shekou Industrial Zone of Shenzhen. The second generation of peasants arrived in the late 1990s and 2000s. These included children of the first generation who, benefitting from the experience gained by their parents, were much more prepared to take collective action to improve job safety and increase pay rates.

Now the first of the third generation are entering the production process and bring with them a much greater awareness of workers’ rights and ways to protest. They have a sense of self-worth and are beginning to demand respect with a consequent dramatic increase in the number of actions by shop-floor workers. A constant theme throughout the history of capitalism is that self-awareness by the working class usually takes place in the second and third generations who come to work in industrial centres.[7]

The Chinese government does not publish statistics on strikes (officially strikes do not exist, strikes and accompanying activities such as go-slows, street demonstrations, etc., are designated ‘collective actions’) but all available evidence shows they are on the increase. Workers whose parents emigrated to one employer are returning to work for another but they bring with them the knowledge that short, sharp strikes are an effective way of redressing grievances. As the confidence of the workers grows, strikes and picket lines are becoming normalised.[8]

16.3 Distinctive Features of the Chinese Proletariat

However, the PRC is determined to minimise the capacity of its proletariat to fight national and international capitalism, and this gives the process of proletarianisation in China certain specific characteristics.[9]

After 1949 the Chinese state played the determining role in shaping industrial relations, primarily through the Five Year Plans and the All China Federation of Trade Unions (ACFTU). With the transition to capitalism the core of that intervention moved to collaboration with the largest employers to provide a recruitment-work-residence pattern that produces an exceptionally profitable and productive labour force.[10]

In China, the state plays a major role in the labour markets by regulating the movement of labour from rural to urban industrial areas. This is done through local governments and inter-province co-ordination and co-operation for the provision of labour directly to local factories, to the SEZs and the cities. For example, the inner provinces of Hunan and Guangxi have long-standing undertakings to systematically provide labour through their own recruiting offices for the construction sites and factories of Guangdong at a rate which attempts to ensure that labour costs remains at one fortieth those in the USA.[11]

The provision of cheap labour, for every kind of work, has become an important activity for the governments of inland provinces because they benefit directly from the fees paid by the companies to which they supply labour, and indirectly from the monies remitted home. The local governments are ideally placed to be the recruiting agents, to co-ordinate supply and demand, screen and recruit (predominantly) single females aged between 17 and 22, supply all necessary documents (no fewer than six separate visas might be required for the major cities), and arrange transportation from village to factory.[12] The recruits would invariably be eager to leave their villages where there is an oppressive patriarchal system, little or no schooling after the age of 16 due to cut-backs in education, few job opportunities and, possibly, to flee an unwanted arranged marriage.

By the end of the 1990s, these government agencies were complicit in widespread illegal practices such as covering up the failure by the hiring company to provide work contracts as required by the Labour Laws of 1995 (and 2008). Without a contract it is impossible to claim such entitlements as paid maternity leave or for a worker to take an employer to court for compensation for occupational injury. To cut costs, migrant workers are deliberately kept in ignorance of their entitlements.[13]

However, for the Chinese working class industrialisation and urbanisation are two different processes. The peasants come to the cities to work but have no right to live in those cities and must return to the village in which they are registered at the end of their contract. From this arrangement arises the extraordinary situation that, for example, only 30% of Shenzhen’s population are categorised as permanent residents.[14] This system has its origins in ancient China and applies even to the children of migrant workers born in the cities because status is passed on through the mother. The hukou system is now a hereditary system for ensuring a generous supply of low-cost rural labour for the SEZs. It saves urban governments which co-operate so willingly with the capitalist enterprises from having to meet medical costs for these migrants and their children who are not entitled to attend the local urban state school. In fact there is an entire range of benefits and rights which are denied the migrant labourers, including the right to vote.

The migrant worker is a temporary resident, tolerated in the towns only so long as s/he is employed. Any action of which the employer disapproves could mean not only dismissal but removal of the residence permit and forced return to the home village. Because the migrant worker has no right to stay in the city, residence permits are a means by which the state attempts to control both labour mobility and worker dissent. The benefits for employers are immediately obvious, they have access to an abundant supply of cheap labour to hold down costs, and there is substantially less likelihood of organised labour solidarity to fight for better wages and working conditions.

Richer elements from the countryside, however, can obtain an urban residence permit provided they are married, purchase a residence within the city limits, and hold down a post for a prescribed period of time, typically a year. Given the prohibitive cost of apartments in China, migrant workers are excluded from this arrangement.

The dormitory-labour regime is an integral and important part of the system for the control of migrant workers to maintain China’s status as the global workplace. Workers’ dormitories are temporary residences for single workers (the great majority) for one or two years. Usually they are close to or within the grounds of the factory they serve, integrating working and non-working life so that the company exerts exceptionally close control over the workers’ activities. Such dormitories are communal multi-storey buildings, housing hundreds or even thousands of workers. Generally, between eight and twenty workers share a room with communal washing and toilet facilities. Living space is intensely collective, only the area within the closed curtains of the worker’s bunk is private space. To cut costs there is always pressure to overcrowd the dormitories which can make them dirty and unhygienic.

Work teams receive pay based on collective performance; hence, the sharing of rooms can increase pressure to conform and perform. However, many companies have a policy of assigning dormitory places at random. This means that there is frequent disruption of sleep because of different working hours, there may even be nightshift and day-shift workers mixed into the same dormitory. The purpose is to break up any existing social networks, and hinder communication and interaction between workers on the same shift. It is believed that this reduces the self-organisation of the workers. At the same time, it also makes the factory a solitary place for newcomers, who, having forfeited their personal and social lives, encounter great loneliness and anxiety, and the resulting alienation and can lead to acts of desperation. Suicide is the extreme manifestation of the migrant work experience.

Dormitories are ideal for the Just-in-Time production system, so favoured by international companies. Confined to the factory compound, workers can be asked at a moment’s notice to work overtime or to work during their rest day to ensure the company meets its delivery deadlines. Living in company-supplied dormitories with extended work hours ties the worker to one employer because it is almost impossible for workers to look for another job.

In total, the pressures on these young women are unlike anything previously experienced by the working classes. Apple made the world’s largest ever recorded profit in the last quarter of 2014, nearly US$18 billion, mostly from sales of 74.5 million iPhones made by second generation female migrant workers in China. Apple supplier Foxconn, employs over one million workers across China[15] and its working conditions were the subject of an investigation by Pun Ngai and Jenny Chan after 14 young migrant workers committed suicide, and another four attempted suicide during 2010. All were between 17 and 25 years old. This section draws on the investigation of working conditions at Foxconn by Pun and Chan.[16]

Foxconn moved its production base from Taiwan to mainland China in the late 1980s to benefit from state support and cheap labour. This support has enabled Foxconn to grow rapidly and now it dominates the global market by producing half of the world’s electronic products. Initially confined to the Shenzhen SEZ, its thirty factories are now dotted all over China with the smallest factory employing some 20,000 and the largest over 400,000.

This geographical expansion has enabled Foxconn to continue to tap into the lower cost labour available in northern, central, and western China. With the encouragement of the central government, these local governments are creating a business friendly environment by promising to provide access to land, roads, railways, bank loans and labour. Naturally, the local governments are in competition, each fighting the others for Foxconn investment.

For example, after the Sichuan government won a US$2 billion Foxconn investment project a total of 14 villages were demolished to create space for a 15 km2 Foxconn “Living Zone”. It is reported that the Sichuan leaders waived a “significant” amount of rent and tax and provided land “far below the market rate”. In addition the Sichuan government provided a free labour recruitment service, with local government officials being given a recruitment quota, setting up stalls at the sides of roads and escorting recruits to the factory gates. It is claimed that over-eager officials told villagers that if no-one from a family went to work at Foxconn, then that family would be fined 1,000 yuan.[17]

Foxconn’s largest factory complex is in Longhua, Shenzhen, and has more than 430,000 workers. Within the walls of Foxconn, most of the employees are young women migrants who work and live there with an average age of about 21 years. Such women are preferred for their supposed docility, nimble fingers, lack of experience of worker self-organisation and preparedness to pay attention to the monotonous, detailed, and mind-numbing work undertaken.

Company managers refer to it as the ‘Foxconn campus’ and it is the model factory presented to visitors from media organisations and other inspection units. This ‘campus’ includes the factories themselves, twelve storey dormitories, warehouses, an employee care centre including a counselling clinic and hospital facilities, a library and bookstores, a post office, a small fire brigade, an exclusive television network, an educational institute, numerous sports facilities, supermarkets, cafeterias and restaurants, and even a wedding dress shop.

In designing its production lines, Foxconn was able to draw on lessons learned around the world ever since Henry Ford first introduced mass production of automobiles. Thus, notwithstanding its facilities, Longhua is a dormitory-labour regime which seeks to organise workers’ activities 24 hours a day to maximise profit. Terry Gou, the CEO and founder of Foxconn has made clear the philosophy which underpins the ‘campus’: “Leadership is a righteous dictatorship.”[18]

Production lines have two properties: minimise human qualities in order to standardise production and eliminate errors, and a division of labour so precise and detailed that workers become cogs in the machine. Today, Foxconn production operators in general are engaged in endless, mechanical repetition of movements made as fast and as simple as possible.

Work is timed to the second and must meet targets set by time and motion studies, at the limit of what workers can produce: “I take a motherboard from the line, scan the logo, put it in an antistatic-electricity bag, stick on a label, and place it on the line. … Every ten seconds I finish five tasks” reported one young woman. In a typical day she might repeat this operation more than 15,000 times, little wonder that so many of these workers claim they feel worthless. It is soul destroying.

If one worker commits an infringement of the rules the entire shift – possibly a hundred or more workers – must remain after work. The woman (80% of these workers are women) is forced to stand and read aloud a statement of self-criticism. She must be loud enough to be heard. The line leader drives home this lesson in humiliation by asking if the worker at the far end of the workshop clearly heard the mistake made. This process forms part of a policy used to penalize workers for petty offences and so enhance shop-floor discipline. A worker can “lose points for having long nails, being late, yawning, eating, or sitting on the floor” and such loss of points jeopardises the monthly bonus. Production workers who stand during work are supposed to receive a ten-minute break every two hours but this only applies if they meet the hourly production target. After a 12-hour shift, factory-floor managers and supervisors can lecture production workers for as long as half an hour, evaluating the shift’s output and listing those areas where performance needs to be improved.

The hours worked and the wage rates paid at Foxconn appear to fit the national pattern and Foxconn likes to point out that workers sign written “agreements” before working overtime. However, since workers have no effective trade union representation or protection, such agreements are meaningless, and whilst Chinese Labour Law specifies a maximum of 36 hours overtime per month, Foxconn workers can work 80 hours of overtime a month. Effectively, the working day is 12 hours, leaving the workers exhausted to the point of tears, for as little as US$300 a month. Workers are lucky to get one rest day a week.

However, despite the near total domination of workers’ lives, the close confinement means that if an issue of common interest arises – e.g. the local government decides not to raise minimum rates – the workers are in a position to discuss and take immediate action. Hence, once action is agreed, the dormitory arrangement can greatly strengthen the workers’ unity.[19]

It has also been found that workers use proximity to form study groups and that they listen to educational programmes on the radio, particularly on labour law to help them in formulating demands on employers: e.g. that in law each worker must have a contract, that the rates paid must be equal to or greater than the local legal minimum wage, that the company must pay social insurance premiums, and so on.[20]

Clearly, the Foxconn management exercises as much control as possible over the workers, yet despite these efforts, Pun and Chan found the workers resisted in many ways, including go slows, stoppages, small-scale strikes, and sometimes even sabotage. As reported by Foxconn workers, on one particular occasion they deliberately failed to meet targets in order to have senior management remove a rude and harsh line leader, and on another occasion everybody stopped working when there was a rush order in order to gain specific concessions.[21] The lessons learned at grandmother’s knee are paying dividends.

16.4 Working Conditions

In 2014 the Hong Kong based China Labour Bulletin carried out a survey of the causes of labour disputes in China.[22] Of course, each dispute is specific and, apparently, has its own particular causes. However, the CLB is concerned to point out that each of the three major factors it identified have been greatly exacerbated by the year-on-year decline in China’s industrial output.

The most common factor is employers seeking to move their factory to take advantage of cheaper labour elsewhere – moving to inland China or, even, Bangladesh – some of them attempted to sell off equipment and flee the scene, not only leaving Chinese workers with no job but attempting to avoid payment of wages owed, statutory redundancy and other obligations. Claims for compensation give rise to about one third of all disputes.

The second most common factor is attempts to reduce labour costs by, for example, re-classifying Saturday and Sunday working as ‘normal hours’ so as to avoid paying double time for weekend work, or ending weekend working and forcing workers to work extra overtime during the week which is paid at a lower rate. Many workers get a pay raise only when the local government increases the minimum wage, but employers are, more and more, attempting to claw back any such increase in pay by reducing, or even eliminating, housing and other allowances, or by cutting bonuses. Another technique is to delay the payment of workers so that they work not a week, but a month in arrears. Problems with wage arrears and overtime payments account for about a quarter of all strikes.

The third most common cause are straightforward claims for an increase in wages to compensate for increases in the prices of consumer goods, rent, etc. Claims for wage increases account for about one fifth of all disputes.

The above ratios refer to factory workers and the experience of other sectors will be different. For example, teachers in the smaller cities and villages are often poorly paid, especially when compared with civil servants and other public employees with the same experience and qualifications. It is not unusual for teachers to go several months without being paid at all. CLB recorded 69 teacher strikes over the period of its report the great majority for payment of wage arrears and increases in pay.

In most factories the actual working day is at least ten hours (including compulsory overtime) and rest days are provided only if there is a break in production, such as during the low season. In the event of a rush order, employees are required to work 12 hours/day in sequential shifts. The situation in many factories is that employees work at least 72 hours each week, far more than the total allowed by Chinese law (40 hours each week, and 36 hours overtime work per month).

It is to be expected that under such conditions, accidents at work are commonplace. Indeed, the International Labour Organisation has stated that, officially, about 380,000 Chinese workers die annually in industrial accidents, but industry is characterised by gross under-reporting:

“… (T)here were more than 20,000 industrial and mining enterprises with occupational hazards problems in Dongguan (a major export centre on the Pearl River Delta in Guangdong Province). They employ more than 5.5 million workers, but only 6,000 enterprises report occupational hazards to the related government offices. The State Administration of Work Safety only monitored 280 of these …”[23]

Possibly the most extreme conditions are to be found in the construction industry which, in 2010, employed about one-third of all migrant labourers. Safety standards are appallingly low. Even in Hong Kong, scaffolding for high rise buildings can be no more than lengths of bamboo tied together with what looks like string. A major reason for the transient nature of the construction workforce is that, in 1984, the government introduced new regulations which made it an offence for construction companies (especially those under state-ownership) to retain permanent on-site staff. From then on the norm has been for workers to be hired by sub-contractors who recruit teams of cheap, unskilled migrant workers from rural areas.

It is normal for workers employed by sub-contractors to work on subsistence wages, expecting to receive their pay as a lump sum at the end of the year. The big problem, especially in the construction industry, is that many sub-contractors simply disappear at the last moment leaving the workers without even the means of returning home. This scandal of unpaid wages is the cause of over half of all China’s strikes, many of which have resulted in violent clashes between furious workers and police.

The PRC has begun to recognise the unsustainability of this situation and in 2008 enacted the Labour Contract Law which accords some workers the right to challenge their employers in the courts. However, those worse hit are effectively excluded from this process because the worker must have a contract before his/her case can be heard, and in some SEZs – and in the construction industry – nearly two-thirds of the workers do not have one.

A second barrier is the obvious anti-worker bias of the great majority of court decisions. Local government finances depend heavily on the success of local enterprises. Hence, the resulting intense competition between localities for outside investment has sensitised local courts to the needs of employers, such that enforcement of labour laws is patchy. However, there is every likelihood that a higher court (or the CCP) will overturn any judgement in the workers’ favour: “Under these circumstances, workers’ rights often end at the courtroom door.”[24]

Many barriers have been erected to prevent workers ever reaching that courtroom door. Before a case can be presented to a court, workers must first go through a mandatory arbitration process, and for the few who possess a contract, that process is complex and lengthy.

It can take a journey of several hours to reach the relevant Ministry building, and having done that it can take days of petitioning, and being sent from one department to another before the correct bureau is found, invariably crowded with other workers seeking redress. If more than five of the applicants appear at any one time they are guilty of an illegal gathering and can be arrested (as the Artigas workers found, see Section 16.3) and, if migrant labourers, stripped of their residence permits and returned to their villages. The workers must argue their own case against professional lawyers and whatever the court decision, there is invariably a lack of will by the local government to enforce it and the workers often end up worse off.[25]

The same obstacles are placed in the paths of any women who seek legal redress for breaches of China’s anti-discrimination laws, with the addition that lawyers screen their cases to avoid this type of dispute because of their low fee potential and limited access to legal aid.[26]

The traditional ‘labour aristocracy’ of the Chinese working class was in heavy industry and mining, and it is these workers who have suffered most under the so-called reforms. The means used to carry through the privatisation of the giant SOEs included such promises as being kept fully informed of all relevant plans, substantial redundancy payments, of being found new jobs and of payment of large sums of money obtained from the sale of the enterprise.

Many, if not most, workers received none of these things. Instead local officials, enterprise managers and privateers proceeded to plunder the state assets for personal gain. According to official estimates, since China first began restructuring the SOEs, state assets valued at between 80 and 100 billion yuan have been embezzled annually.[27]

In March 2007, the vice-chairman of the ACFTU, Xu Deming, stated unpaid wages owed by SOEs which had been ‘restructured’ amounted to over two billion yuan, together with a total of as much as one billion yuan in unpaid compensation. He further noted that in enterprises that had been privatised, 25% of the laid-off workers were not receiving any form of social security benefit.[28]

To redress their grievances the workers were encouraged to use the so-called petitioning process whereby citizens, either individually or collectively, can appeal to the authorities over specific grievances. In China this is a well-established procedure. But it is a system that serves as a buffer protecting government officials, absorbing the petitioners’ anger but without any meaningful outcome. For laid-off SOE workers it was a bureaucratic trap, with complainants being sent off on an endless paper chase as bureaucrats passed the buck and covered each other’s backs. When the wrongdoing was by a government department the accused person was a high-level official or business associate of the government, cases were quietly shelved.

Worse, the system generally meant petitions ended up in the hands of the organizations and officials being complained about, and who might be the employers of the complainants. Thus, petitioners could be putting themselves at risk of retaliatory action by those targeted in the complaint.

In parallel with petitioning, workers were taking their cases to the courts. But all too often the case would include government officials and government departments who were also often direct beneficiaries of the privatisation. As the number of privatization dispute cases rose rapidly China’s senior judicial authorities instructed the courts to stop hearing such cases. On 26 March 2006 the All-China Lawyers’ Association directed its members that if they took on a collective case then they had a responsibility to “actively assist the judicial authorities”, that is to collaborate with the accused against their clients.[29]

When they discovered that the system served to shield the corrupt and, possibly, expose complainants to the risk of retaliation, the workers soon lost all faith in it. As a result, many workers proceeded with their own actions, just about every SOE restructuring/ privatisation programme led to some kind of dispute with the laid-off workers demanding payment of wages owed, payment of a pension, medical insurance and social security benefits, along with assistance promised in securing re-employment.

Left with little alternative the workers were forced to demonstrate on the streets to make their demands heard. However, many of the local government officials and Party tops were personally involved in the privatisation deals and saw these worker demonstrations as a threat their own positions which, of course, they presented publicly as a criminal threat to “political stability”. Using their influence with the police and judiciary they attempted to have the demonstrations broken up and banned and the activities of the protest leaders arbitrarily punished. Under Chinese legal procedures the police can hold protestors charged with criminal offences for an extended period of time, weeks, months and even years without trial.

Between 1998 and 2001, workers at the Ferro-Alloy Factory submitted numerous petitions to a wide range of government bodies accusing plant manager Fan Yicheng and others of embezzlement, but received no response from any of them. Fan was only investigated after more than 10,000 workers took to the streets in March 2002 and publicly pressured the government to take action. The strike leaders attempted to spread their strike to neighbouring factories and for this were arrested, beaten up and jailed for subversion and terrorism.[30]

Disputes arising from the privatization of SOEs have typically dragged on for many years, as local governments, the courts and the ACFTU failed to address the widespread injustices committed against workers in the course of restructuring. Indeed, these long-running collective labour disputes amount to a festering sore. Leaders in the fight for workers’ rights have been silenced, persecuted and imprisoned, while the grievances of those they represented have been ignored by those in authority and laid-off workers have been left to fend for themselves.

So great and obvious was the divergence between the promises and reality that it brought the officially-recognised trade unions and the labour laws into disrepute. And there is ample evidence that Chinese workers, especially women migrant workers, are increasingly prepared to by-pass these laws and self-organise: to go on strike, demonstrate in public, and take direct action such as blocking major roads, even wrecking offices or work completed.[31]

The then President and Party Secretary Hu Jintao and Premier Wen Jiabao, concerned that such hard line measures were not reducing the number of independent labour actions, introduced a softer approach and launched a campaign calling for a “harmonious society”.

Now, it is not uncommon to see court staff racing to a flashpoint where workers are publicly protesting, in desperate attempts to defuse the situation and restore social stability by giving free advice on how to take the dispute through the courts. For the time being the police are being reined in and while strike leaders are still being arrested and demonstrations broken up, any deaths are seen as a ‘mishandling’ of the situation and a blot on the career of the Party top responsible.[32]

Harmony as a social ideal has roots in the paternalistic and hierarchical ethics of Confucius. Efforts have even been made to harmonise Confucius with Marx, but this is something that can be achieved only by entirely eliminating Marx’s concepts of class struggle and revolution. The appeal to Confucianism is intended to give modern concepts a veneer of Chinese exceptionality and promulgate the idea that the PRC is following a uniquely Chinese path for the good of the country as a whole.[33]

The appeal to “social harmony” has meant that the regime has had to offer concessions to peasants and workers. In respect of the peasants, the government has reduced taxes, raised prices for farm products and provided subsidies; whereas for city workers, it introduced a substantial increase in the minimum wage in May 2015. Simultaneously, in both rural and urban areas the regime promises the expansion of educational provision and healthcare services. The government is also pledging a significant improvement in pensions provision – no doubt hoping to enlarge the internal market. Great publicity is being given to bringing the most openly corrupt of the CCP cadres to justice and there have been some high profile trials. The need to appeal for social harmony is a façade to convince workers, especially, to trust the CCP leaders and do nothing to threaten the present system.[34]

The state also excuses itself to the working class by presenting its current economic problems as being shared worldwide, that the solutions proposed are common to all workers internationally. For example, Britain’s ‘Workfare’ programme was used as an example to support China’s own plan to deny benefits to workers who do not join re-training schemes.[35]

16.5 The Official Trade Union

The fundamental right of all workers – the right to strike – was deleted from China’s Constitution in 1982. The state, however, makes a point of never arresting workers for strike actions, the charges are invariably damage to property, public disorder or assault, but these are widely used. Despite the law regarding Trades Unions being amended twice since then, once in 1992 and again in 2001, workers remain denied their basic democratic rights of free association, free collective bargaining and strike action. The ultimate strength of the working class comes from collective action, to deny the class that right is to hamstring it in the face of the employers and their state.

The ACFTU is the only legally-permitted trade union in China and has a very close structural relationship with the CCP, with considerable overlap in membership and with key ACFTU personnel, even at a local level, appointed on CCP advice.[36] The ACFTU was (and is) not a union as understood in the West, but rather a branch of government staffed by careerists whose primary role is to ensure the workers accept government policy. Just like union leaders in capitalist countries these people ensure union power at the point of production is paralysed. To date, the reality has been that if workers take industrial action they find themselves confronting a bloc consisting of the employers, the state (police), and the ACFTU – which has, on occasion, hired thugs to break picket lines and beat up strikers.

Union officials will visit trade union members who are sick or injured and ensure they receive their due payments, arrange New Year parties, works’ outings, sports days and, a speciality of China, matchmaking events, but their key tasks are to maximise productivity and minimise work stoppages whether due to accidents or industrial actions.

However, the form of the official trades union has changed and developed under the pressure of events and government directions. Traditionally, the ACFTU had the bulk of its membership in the huge SOEs of the north east and in government departments. It received its income not from the dues paid by workers but by direct payment from the government, typically 2% of the payroll. The post of trade union branch chairperson carried with it the salary and benefits of a deputy director of the relevant enterprise, and this was a post for life if the activities of the workers were kept within limits acceptable to the enterprise.[37]

A collapse in ACFTU membership and income occurred during the 1990s as the SOEs shed staff in preparation for privatisation. In a decade, membership fell from about 40% of the country’s workforce to just over a quarter. However, with the explosive growth in the number of workers in the SEZs and outbreaks of wildcat strikes and other actions, the government decided the ACFTU should make a determined attempt to establish itself in the private sector as a mechanism for controlling the militancy of the workforce, and increasing the profitability of the enterprises. Over the next five years the ACFTU increased its membership massively and, in an echo of its Stalinist past, professed to have recruited 110% of the workforce in some areas.

These recruitment drives were largely paper exercises whereby the ACFTU, working through the regional or town Trade Union Council, contacted all those companies in a given area with more than 25 employees and reminded them they were legally obliged to have a union and, in many cases, guaranteed no collective actions. The employers signed up with the ACFTU, usually without mentioning it to the workers and were allowed to appoint the company’s union representative, typically the Head of the Personnel Department.

It must be understood that the workers themselves played little or no part in this recruitment drive. In many, possibly most, cases the workers were unaware that they had become members of the ACFTU, which negotiated directly with the employer for the block recruitment of all workers (and managers) in the company. Union dues would be paid by the company as a percentage of the payroll in a direct continuation of arrangements made in the SOEs.[38] Ching Kwan Lee carried out a study of trade union structure in the SEZs and she found that in most cases, enterprise managers were the union officials. Of 250 enterprises examined, senior managers were the branch chairmen in 144 cases, and middle managers in most of the remainder; in only very few cases did shop-floor workers hold even the most minor union posts.[39]

Typically, the owners of a company establish the shell of a union, appoint managers as the required officers and register the union with the ACFTU, paying all the necessary monies. Once recognised, and there are no recordings of such submissions being rejected, any attempt by the workers to organise outside of this company union is illegal and any activists are open to arrest, to be stripped of their residence permit and returned to their villages.

For example, NCW, a Taiwanese-owned enterprise in Shilou Town, Guangdong, employed 550 (mainly) migrant workers who had not been given contracts. As part of the ACFTU recruitment drive the Shilou Town Trade Union Council (STTUC) urged NCW to set up a “grassroots union”. Under pressure from the local Party committee, NCW completed the required paperwork, paid membership fees to the STTUC, and received an official document declaring the establishment of a NCW union, but took no further action. The workers were kept completely ignorant of this process.

Subsequently, a group of migrant workers with some previous experience of factory work arrived at NCW and challenged the company’s illegal labour practices. In the belief that a trade union would help them they approached the STTUC only to be told they were already in a union and must cease their efforts of self-organisation because Chinese Trade Union Law prescribes that only one union can exist in an enterprise. In the meantime, the employer acted quickly, called all the managers (who were, of course, union members) to a meeting and activated the union by appointing the HR manager to the post of union branch chairperson. Naturally, the workers refused to participate but its existence meant that no genuine trade union could be legally established.[40]

A second example is Foxconn. Eight years after its founding (2006), the management of the Longhua plant set up a trade union. This was done at this time because of the double pressure of adverse media publicity about working conditions in Foxconn factories, and the Shenzhen Federation of Trade Unions. The Foxconn union chairwoman is a special assistant to the CEO with corresponding pay and conditions.[41] However, it appears that participation in the union is not encouraged, and a survey found that about 90% of Foxconn workers claim to have never heard of elections for union officials.

A variant of these recruitment processes is where the ACFTU establishes a regional union which attempts to organise all the workers in a particular trade across a number of small factories, and may have been introduced because the ACFTU leadership wanted to head off and prevent a movement similar to Solidarity in Poland. These unions are independent of any one employer but remain highly dependent on the CCP and state policies. The process of recruitment is the same but because the union branch covers a number of small firms there is a tendency for wages to rise to the level of the highest, which is popular with the workers. This system is accepted by the employers because it is backed by the state, acts to control worker militancy and, in the final resort, is of net benefit to the enterprise.

This then, was the policy of the ACFTU during the growth of the SEZs. However, there were three serious problems with it. Firstly, workers were generally unaware that they had become members of the ACFTU, so it had little direct effect on employee-employer relations. Secondly, the ACFTU had, in the main, negotiated with the larger employers but, at that time, it was workers in the medium and small private companies (less than 1,000 employees) who were walking off the job, demonstrating, threatening to commit suicide in public, besieging plants, setting fire to facilities, and even holding bosses captive. The third problem was that few ACFTU officers had any experience of dealing with workers who were in conflict with management, and even fewer had any sympathy with the workers.

However, the impact of second and third generation migrants is having its effect on the workplace. From a very small start, and despite being a very contradictory process, genuinely elected workers’ representatives are beginning to appear. In many cases they emerge during (unofficial) strike action, actively representing the strikers and continue in this role when the strikes are over. At one Shenzhen toy factory, the workers elected five representatives, three of whom were women who had led a recent strike and organised the picket lines, blocking police action. However, such shop stewards are often fired on some pretext once the industrial action is over and the situation defused.

At the same time, the lowest levels of the ACFTU bureaucracy are increasingly having to face angry workers who are taking industrial action and try to get them to end their protests and return to work. This can be very uncomfortable for them. In such a situation the full-time union officials can find it beneficial have the staff approve (but not choose) the leadership (officers) of the local branch. To date, the one and only time an ACFTU branch has opposed a company’s actions, it was led by such a branch officer.[42] As the class struggle develops the lower echelons of the bureaucracy, those in daily contact with the workers at the point of production, are subject to pressures that make it very difficult for them to behave in an openly dictatorial and class collaborationist manner. Once class struggle is in the air it is quite possible that a number of bureaucrats will side with the workers. Experience shows that a small number of union bureaucrats will give up the gravy train and side with the workers, but only so long as the latter remain steadfast.

As a general rule, Walmart is opposed to the unionisation of its workforce. China is an exception. No doubt the decision was made easier by the ACFTU’s history of subverting effective collective bargaining.

The creation of the Walmart workers union for more than 100,000 workers in the company’s 400 stores followed the usual pattern, being little more than an exchange of correspondence, completion of forms followed by the payment of union dues by Walmart. The process was undertaken quietly, on a store-by-store basis which kept workforce awareness and unity to a minimum. Once the local Walmart store manager received notice that the store was being unionised, the union officers were selected from the store’s managers.

Early in 2014, as part of its response to the slowdown in China’s economy, Walmart suddenly announced the closure of its store in Changde, Hunan province. To everyone’s surprise, Huang Xingguo chairperson of the store’s ACFTU branch, led over 75 workers in a strike against the closure, throwing a 24-hour picket line around the delivery depot to prevent the company from removing goods from its shuttered building.

Despite the company and the local authorities joining forces and the police being sent in to clear the site of pickets, the workers’ determination and the publicity surrounding the event meant the detained workers were released and the pickets were able to return the next day. The outcome was that Walmart was forced to go to arbitration, to negotiate with the strikers, and significantly increase the severance deal.[43]

It was at this time that the ACFTU had launched its so-called ‘grassroots’ initiative so that in a small number of enterprises the branch chairperson was subject to election by, or approval of, the workforce. Huang was one such. Huang says he was motivated by a sense of the injustice being suffered by his fellow workers: “I knew I needed to help the workers, … I knew that if I didn’t, I would not be able to forgive myself.”[44]

The Walmart strike has been widely hailed as small but symbolic. Huang’s participation as chair of the ACFTU branch made a tremendous difference to the combativity and level of organisation of the workers. The case of Huang Xingguo has been hailed as of enormous significance, for reactionaries it is a warning of the dangers of democratisation of the ACFTU, and for militants it is a pointer to the advantages that can be gained by working within the official trade union movement.[45]

16.6 The 2015 Labour Regulations

The measures taken by the government and the ACFTU have been largely ineffective in halting the rise in worker militancy and the rapid increase in the number of strikes. In the five years from 2011 to 2015 inclusive, there has been a sevenfold increase in the number of strikes. Furthermore, strikes are taking place in sectors previously immune, such as the state-owned power company (State Grid) which, in reply to workers’ demands for a pay increase and equal pay for equal work, has sought to push through an unpopular wage structure which would seriously disadvantage the lowest paid.

Of course, the government would love to continue its collaboration with the employers, ignoring labour law violations by companies, harassing activists and sending police with dogs to restrain any action by the workers. But such a policy is of decreasing effectiveness because, despite increased police activity, there are objective factors making the workers more militant.

The bourgeoisie themselves, recognise a number of factors for the increasing unrest on the factory floors[46]:

  1. The growth rate of the Chinese economy as a whole has slowed to 7.4%, but manufacturing activity in areas such as Guangdong is actually contracting with consequential strikes against worker lay-offs, cuts in working hours, replacement of full-time staff with temporary workers, failure of factory owners to have in place statutory redundancy schemes to compensate workers, workers finding out that pension payments have not been made (sometimes for decades), and so on. As a result, workers of all ages and backgrounds are united against the threat of unemployment or pension poverty, and are prepared to take action for what they see as their legal rights.
  2. The available data shows a zero increase in the number of workers in the core age group available and wanting work in the SEZs, which means a stronger bargaining position of those on the shop floor.
  3. Workers better understand their rights and are becoming better organised. NGOs such as the China Labour Bulletin operate hotlines, drop-in centres and other outreach activities to raise workers’ awareness of their legal rights to minimum wage rates, to limits on overtime hours, the requirement of the employer to pay pension contributions, health and welfare contributions, and even housing support. These organisations have long been the subject of government harassment but continue to give advice on how the workers can self-organise, and how to use the ACFTU to maximum advantage.
  4. The first time police break the picket line and arrest strike leaders it is a major trauma for the workers involved, but the second time round the workers are prepared and the shock effect is substantially reduced. The brutality of the police and the ACFTU thugs is a diminishing asset to the state.

As the economic situation in China deteriorates, workers’ struggles will inevitably become more intense. One solution could be to make repression more severe and such a trend has been observed in the de facto criminalisation of strike actions by the increasing frequency of striking workers being charged with criminal rather than civil offences. However, the recent response of the government has been to launch a raft of measures to head-off worker militancy and divert it into channels safe for the regime rather than embark on open confrontation. The first step was a move by the government to take the wind out of the sails of pay demands by approving an increase in minimum pay rates, up 19% in Guangdong the most militant area in China. The government obviously believes that as long as the workers feel they are making gains under the present system they will not radicalise.

More importantly for the future are the changes being made to industrial relations and the role of the ACFTU. This body, with 260 million members and nearly one million officers, is widely seen by workers as, at best, ineffective and all recent strikes (bar the one at Walmart) have been initiated from outside the ACFTU. New regulations issued by the People’s Congress of Guangdong set out a new framework for collective bargaining and dispute resolution in which the ACFTU is expected to take more and firmer control of employee demands and collective bargaining. Given the importance of Guangdong to the national economy these proposals must have originated in Beijing.

The new regulations provide a structure which seeks to give an additional layer of control over the workers. First, and by far the most important, these new regulations (Article 24) make strike action, and incitement to strike action, unlawful during any “collective consultations”. During such times the workers must act “peacefully and rationally”. The obligation on the workers not to strike means there can be no immediate, effective response by the workers to remedy unilateral actions by the employers – an arbitrary reduction in piece rates, cutting ten minutes off the lunch break, etc.

The new Guangdong regulations show clear signs of having been drafted based on the experience of anti-trade union legislation in force elsewhere. Only demands which have the support of at least 50% of the workforce can be submitted, must be channelled through a branch of the ACFTU, and must be “reasonable”.[47] Any demands for higher pay must be in accord with agreed performance criteria and based on the profits of the enterprise. The 50% figure is designed to appear reasonable but, in reality, to limit the activities of militants. The extended period allowed for negotiation will permit the enterprise to either wear down the workers or organise to transfer its facilities elsewhere, The Economist summed up: “The regulations effectively shut the door to the kind of spontaneously-formed groups of workers that have often taken the lead in Guangdong’s strikes.”[48]

The largest single cause of strikes in the Guangdong SEZs is factory owners attempting to move their enterprises to a new location surreptitiously to avoid paying wages owed, to avoid paying pension and other contributions, and to avoid paying compensation for redundancy, etc. Here, more than in any other element, the new regulations show their class bias. The regulations spell out that workers in dispute over a factory closure may not obstruct the removal of equipment and materials, nor may a worker who learns of such a plan convey that information to his/her colleagues because that would be construed as breach of Article 22, as engaging in actions that “intensify conflict”.

The only fig leaf is the supposed protection for the workers’ negotiators who may not be sacked while the negotiations are proceeding, unless the employer informs the class-collaborationist ACFTU and listens to any objections the ACFTU might make.

Importantly, the regulations seek to divide the workers by not providing cover for the temporary workers who comprise such a large proportion of the workforce in the SEZs. This is a deliberate attempt to subvert worker solidarity, precisely because in a number of important recent strikes there has been a noticeable level of mutual support between migrants and resident workers.

Those with experience of trade union negotiations know full well that employers invariably try to protract negotiations in an attempt to erode and break worker solidarity and facilitate the transfer of its facilities to a new site. The new regulations allow the employer to drag out the negotiations for at least ninety days after which the dispute goes to mediation – a process which might take further months, during which time the workers must continue with the wages and conditions previously existing.

In the major strikes that have occurred in 2015 since the Guangdong regulations were announced, the ACFTU, despite representations from the workers concerned, has unquestioningly continued its previous policy of openly supporting the employer against the workers. Two actions, in particular, were widely reported.

The most widely reported action was by workers at the Shenzhen factory of Artigas Clothing and Leatherware.[49] In December 2014, about 1,000 workers at Artigas struck for nine days in an effort to get the company to listen to their demands for unpaid overtime and unpaid social insurance. The workers’ leaders requested the local trade ACFTU union to intervene on their behalf, but on the morning of 18 December hundreds of police descended on the factory to arrest the strike leaders and disperse the picket lines. The workers were forced to return to work.

In June 2015 the dispute escalated when Artigas management began to remove equipment and machines from the factory without notice or negotiation with workers. More than 900 Artigas workers struck and occupied the factory plants from 9 June to prevent management from secretly removing the remaining machinery from the premises.

Artigas hoped that by formally offering to retain staff, even though the move would make it very difficult for the workers to actually transfer, it could avoid paying workers the severance and other social insurance payments they were entitled to under current regulations. By shutting down with no notice, the company hoped to complete the move before the workers could respond, and because few if any workers, would or could transfer, such a move would end the ongoing disputes over arrears in the payment of social security contributions and overtime.

These actions were taking place under the new regulations so a key issue was the refusal of management to enter collective negotiation with the workers concerning the closure and the resettlement scheme. An interim meeting was held between management and workers’ representatives at the start of July, but the workers’ request for collective negotiation was rejected. Subsequently, the management unilaterally terminated any further negotiation and announced that they would only communicate with the workers individually, a well-known divide-and-conquer technique for breaking the solidarity of the workers and preventing them from using their collective power.

Artigas workers travelled to Guangzhou, the capital city of Guangdong province, to present a petition to the Provincial Government, but the group was treated as an illegal gathering and sent back to Shenzhen in a bus escorted by police cars. On arrival the delegation were all arrested and detained overnight!

As part of their strategy, the management attempted to buy off a leading representative of the workers, Wu Weihua, offering her 150,000 Yuan (about UK£15,000 or US$20,000). She refused this bribe and was sacked. On the first day of the strike the police removed more than ten workers, including Wu Weihua. All were released later the same day except Wu. According to the police, she was “seized by the factory”, meaning that the management had told the police to detain her. Importantly, the police did not follow their normal procedure of charging a striker with a civil offence, but instead charged Wu with the criminal offence of ‘obstructing public administration’. This meant she could spend a month or more in jail before being brought to court.

Soon the police returned to the factory and detained five more workers and then told them that if they ended the strike and accepted 500-1,000 RMB per person as compensation, they would be released. Reluctantly, the workers agreed. The five detained workers walked free, but Wu remained in jail facing trial.[50]

This example demonstrates certain historical characteristics of workers’ struggles across China. The workers involved tend to use the organisations at hand and the efforts by many Chinese workers to gain the support of the ACFTU in the struggle against their employers is confirmation. The new regulations recognise this and attempt to use it to the advantage of the Chinese bourgeois. The ACFTU will come under intense and contradictory pressures to make the occasional militant noise and lead the negotiation of pay and conditions for groups of workers, while simultaneously they will have to tell the workers that they can take no collective actions to help their demands. This process is just beginning and events thus far show that it will be a highly contradictory and convulsive one, with the lumbering, bureaucratic machinery of the ACFTU struggling to cope with the changes to be made.

The CCP wishes the ACFTU to head off worker militancy by taking control of negotiations on pay and conditions but the process will not be helped by the large number of important posts within the union held by senior managers of capitalist enterprises. They will oppose any change that impacts adversely on profitability. That the government will hold responsibility for the mediation procedures will involve it directly in industrial disputes which will open the door to the underlying political issues. The process may backfire badly because the tide of worker militancy is rising at a rate that may swamp any attempts by the ACFTU to contain it.

How militants can use the local ACFTU branch to aid their struggles is by no means clear. However, today the workers’ movement has considerable experience of state-run unions, for example, in Stalin’s Russia and Mussolini’s Italy. In September 1934, the fascist regime in Italy passed a law ending the top-down appointment of all officials and giving a thin layer of elected officers the responsibility for negotiating minor elements such as toilet facilities. Militants who stand for such posts should ensure that the elections involve the greatest number of union members and are discussed at branch meetings, not only so that activists get to know each other but members discuss union democracy and the role of shop stewards. The new Guangdong regulations state (Article 13): “Negotiations representatives for the employees shall either be selected by the trade union or by a democratic election by the staff and workers that is organised by the trade union.” If this loophole remains open then it should be used by militants to campaign on pay, conditions and union democracy.

16.7 The Growth of Inequality: Woman After the “Reforms”

The last thirty years has seen the creation of many millions of jobs, mostly in the private sector, and mostly taken by peasants moving from the countryside to better their living conditions. This engendered tremendous support for the regime, but now things are different. The migrant workers are no longer grateful for being given a job, any job; they are demanding decent wages and conditions. At the same time there is tremendous resentment in those areas which houses the giant SOEs and where living and working conditions are much worse than ever before. These developments have been accompanied by an enormous and growing polarisation between the classes. Huge social disparities are evident: in a generation, the top richest 10% have acquired 85% of the nation’s assets.[51] Of course, there is no inheritance tax.

Incomes are similarly skewed. The top 5% pay themselves 23% of China’s total household income but the bottom 5% receive a miserly 0.1%.[52] A new wealthy bourgeois class is being created but there are many millions unemployed or under-employed, particularly in the so-called rust belt. It is now a common sight, even in Beijing, to see poor locals clamouring to wash the windows of the Rolls Royces of dollar millionaires.[53] These glaring social inequalities are a major source of discontent, as is the obvious corruption of state and Party officials.

The Gini coefficient is an internationally recognised measure of how a nation’s income is distributed amongst its citizens. A Gini coefficient of zero represents a society in which all citizens have equal income. A Gini coefficient of 100 is where one single citizen receives all the income and every other citizen receives nothing. The OECD, United Nations and other international bodies claim that a Gini coefficient of greater than about 40 represents a society with an unacceptably skewed income distribution and potentially destabilising social inequality.

China has not made its Gini coefficient public since 2000, when the figure was 41. Unofficially, Chinese media reported that it stood at 47.4 in 2012. At that level China is more unequal than Indonesia at 34.3, India at 36.8, and the US at 40.8 The urban Gini has remained between 47 and 49 for the past decade, indicating that China has become one of the most unequal societies in the world.[54]

Giant luxury skyscrapers sprout but are surrounded by immense areas of urban poverty. This growing social divide is symbolised by the fact that far fewer Chinese have access to clean water than to a cell phone. This alone would be enough to provoke class struggles in China, where the manners and practices of the newly rich are increasingly reminiscent of the behaviour of pre-revolutionary landlords resulting in the Xinhua agency claiming: “If the trend goes unchecked, … the widening gap may trigger social unrest.”[55]

For women overall, participation in the workforce increased from about 30% during the early years of the reform, to 40% in the 1990s and to about 45% today. However, when the SOEs were preparing for privatisation it was policy to sack women before men, thus the employment rate for urban female labour declined from 75% in 2000 to 61% in 2010, the lowest for thirty years.

At the same time relative pay has decreased. In 1988, the average woman worker earned 55% of the wage of an average male worker, by 1994 this figure had declined to 42%, and today, on average, is about one third. The government has a policy of equal pay for equal work, but even where men and women do the same work, the pay of a Chinese woman is typically only about two-thirds that of the man. The proportion of women in work is rising but their wage rates are falling, relatively. The explanation is that under the reforms women are increasingly being employed in unskilled, low-paid jobs while, simultaneously, pay differentials have risen sharply.[56]

Market forces are exacerbating gender earnings inequality. Cross-sector analyses show that the gender earnings gap is smallest in government and public institutions and largest in the private sector. Increasingly, women are employed on a production line, in a service industry or clerical job with lower income and fewer fringe benefits. As would be expected, few of these women are CCP members.[57]

At a time when the Chinese government is bewailing a shortage of skilled workers, women receive significantly less education than men, on average 7.5 years as against 8.5 years. Universities blatantly enforce gender discriminatory entry policies. Because women now regularly score better marks in China’s all-important college entrance exams, universities and colleges raise the admissions standards for women leaving women with higher marks than male entrants without a place.[58] Many university courses regularly refuse female applicants; no women are allowed on many engineering degrees which guarantee a senior job after graduation.

That discrimination is increasing, is important. Practices which put the man on a pedestal simply because he is male show how centuries-old discrimination can resurface in the 21st Century if social conditions are right. The drive towards capitalism has strengthened and encouraged practices from the imperial era that even the Stalinist regime of Mao considered abominations.

Since about 2007 the government, with the active support of the All China Women’s Federation (ACWF, staffed by Party bureaucrats), has been waging a widespread, raucous and misogynistic campaign against those women who dare to choose not to marry. The reason given is that unmarried males are turning to activities which “endanger the social order,including, gambling, rioting, stealing and gang fighting.”[59] China has one of the highest male to female ratios in the world, about 120:100. For comparison, India has a ratio of about 115:100. Both imbalances are due primarily to sex-selective abortions. This implies that in some rural areas of China as many as one in ten foetuses which would have been born a girl are aborted. This is an astounding number. The practice remains illegal but the figures show that while the law was largely enforced in the workers’ state, the capitalist regime closes its eyes to the matter.

Long gone are the days when members of the ACWF would publicly confront a violent husband and teach him the error of his ways. Instead, China is in the middle of an epidemic of violence against women. There is no law in China specifically concerned with domestic violence and police officers attend an incident as enforcers of social stability, not to protect the victim. Yes, China classifies intentional injury as a criminal offence but in domestic cases only long-term and repeated violence, supported by independent evidence is sufficient for a judgement on behalf of the wife. Even then, the husband is likely to be awarded the family home![60]

In considering birth defects, it is notable to observe that as China’s pollution levels increase there has been a sharp rise in the number of babies born with a deformity. The link between the two has been the subject of numerous scientific, even government, publications.[61] However, the official line is to place the blame for these defects on the behaviour of the mothers, marrying later in life or neglecting their health during pregnancy.[62]

The anti-woman attitude of the Deng administration showed itself early on with the enforced retirement of many leading women in the Party and state hierarchies and their replacement by men. In 2012 the Party’s Organisation Department published figures to show that, at Minister level or above, 11% of officials were female, though more than 40% of Party members are women. There is no woman on the Standing Committee of the Politburo (7 members) and only two, Liu Yandong and Sun Chunlan, on the Politburo itself (25 members). Of these two, Liu Yandong is an established member of the ‘Prince Party’, the closed circle of senior officials who carve up money and influence in China between them. Her father was Liu Ruilong, a former Vice-Minister of Agriculture. She has taken care never to voice a political point of view in public.[63]

16.8 Summary

China has returned to capitalism. The three key indicators of this – the monopoly of foreign trade, a planned economy, and nationalisation of key industries have been reversed and replaced by a market economy with each enterprise striving to maximise its profits. The transition was initiated and overseen by a Stalinist bureaucracy greedy to retain its privileges and which saw capitalism as a safer bet than a worker’s democracy.

In assessing the role of the CCP and its leaders, we must consider how well they have achieved their goals. Whatever their roots, this group has dismantled the planned economy and privatised state assets, and in so doing they have, almost without exception, acquired vast private fortunes which are invested not only in China but around the world. Their greed knows no bounds, while still raking off enormous salaries and perks as Party tops they have their villas in the south of France, their apartments in Beverley Hills and their houses in London. Their children go to the world’s top private schools and, under current laws, will inherit their parent’s huge fortunes. Re-reading Lenin on the British Labour Party:

“… whether or not a party is really a political party of the workers does not depend solely upon a membership of workers but also upon the men that lead it, and the content of its actions and its political tactics. Only this latter determines whether we really have before us a political party of the proletariat. Regarded from this, the only correct, point of view, the Labour Party is a thoroughly bourgeois party, because, although made up of workers, it is led by reactionaries, and the worst kind of reactionaries at that, who act quite in the spirit of the bourgeoisie”[64]

It is unambiguously clear that the CCP is a bourgeois party.

Social inequality is growing fast, class differentiation is a fact; despite the state retaining a significant degree of control over industry and over such factors as exchange rates, an economic downturn was clearly seen in 2008. Today state control is much less and the threat of a world crisis of overproduction is growing fast. China produces as much steel as the rest of the world combined and overproduction has meant the price of steel price in China is now less per tonne than cabbage.

Monopoly capital, of which Foxconn is an extreme example, is creating gigantic global-scale factories that dominate the lives of Chinese workers. Foxconn and its fellows have been enabled by an economic transformation at a national level in which the leadership of the CCP has chosen to ally itself with and become part of big business in the belief that this will allow it to continue running China. What Foxconn provides is living proof of Trotsky’s analysis made near the end of his life that modern monopoly capitalism does not rest on competition and free private initiative but on centralised command. There is an identity of outlook and interests between capitalist cliques at the head of these giant companies, banking consortia, etc., and those holding state power. They collaborate at every step and neither can allow free trade unions.[65] This has been taken to extremes in China where the same group (CCP members) are in control of government, trade unions, and many of the most important industrial enterprises and banks.

The alliance extends from local governments reducing relocation costs, maintaining minimum wages at artificially low levels, acting as the recruiting sergeants for incoming factories, to labour laws which effectively outlaw strikes. We have seen that to maximise profit from these factories the bourgeoisie has restructured the form of the relationship between bourgeois and proletarian. These forms, including residence permits and dormitory-labour schemes, are subjecting workers to more intense exploitation and great hardship and suffering. Contradictions between capital and labour are accumulating at the point of production and, notwithstanding an alliance of state, unions and employers, are resulting in increasing levels of struggle by the Chinese proletariat.


[1] Chan, K. China, Internal Migration. Blackwell Publishing, 2013.

[2] The World Bank, http://data.worldbank.org.

[3] Li Shi, Rising Income and Wealth Inequality in China, Beijing University, 2011.

[4] Foreign and Commonwealth Office, China: Labour Relations in Guangdong, 30 Jan. 2015, ww.gov.uk.

[5] Reuters, IMF sees China slowdown risks, 7 Oct. 2015.

[6] Guardian, 20 January 2015.

[7] Thompson, E. The Making of the English Working Class, Victor Gollancz Ltd., 1963.

[8] Pringle, T. Trade Unions in China, Routledge, 2013.

[9] Engels, F. Conditions of the Working Class in England, 1887, www.marxists.org.

[10] Pun, N. and Smith C. Putting Transnational Labour Process in its Place, Work, Employment and Society 21(1)27-45, March 2007.

[11] CLB, Wages in China, clb.org.hk.

[12] Pun N. et al. The Role of the State…, Global Labour Journal, 1(1)132-151, 2010.

[13] Pun N. and Lu H. A Culture of Violence, The China Journal, No64, July 2010.

[14] Pun, N. Women Workers … Gender & Development, 12(2)29-36 July 2004.

[15] BBC Panorama programme, 18th December, 2014.

[16] Pun, N., and Chan, J. Global Capital, the State, and Chinese Workers: The Foxconn Experience, Modern China: 38(4)383–410, 2012.

[17] Economic Observer, 4 May 2012.

[18] Mail Online, 26 June 2010.

[19] Pun, N. Gender and Class, International Labour and Working Class History, No81, pp178-181, Spring 2012.

[20] Pun, N., and Lu, H. Unfinished Proletarianization …, Modern China, 36(5)493-519, Sept. 2010.

[21] Pun and Chan, Global Capital, … Op. cit.

[22] CLB, The Workers’ Movement in China 2011-2013, clb.org.hk.

[23] Dongguan Daily, 2 Aug, 2011.

[24] Pun, The Role of the State… Op. cit.

[25] Yang Su and Xin He, Street as Courtroom, Law and Society Review, 44(1)157-184, March 2010.

[26] Burnett, J. Women’s Employment Rights in China…, Indiana Journal of Global Legal Studies, 17(2)289-318, Summer 2010.

[27] Li Jinhua. Auditor-General of the National Audit Office PRC, Radio Free Asia, 30 September. 2006.

[28] CLB, No Way Out, clb.org.hk.

[29] Ibid.

[30] Ching Kwan Lee, Against the Law: Labour Protest in China, University of California Press, 2007.

[31] Pun, N. and Xu, Y. Legal Activism or Class Action?, China Perspectives, No 2011/2.

[32] Yang Su and Xin He, Street as Courtroom, … Op. cit.

[33] Weil, R. A House Divided: China after 30 Years of ‘Reforms’, Economic and Political Weekly, 43(52)61-69, Dec. 2008.

[34] Ibid.

[35] Blecher, M. Hegemony and Workers’ Politics in China, The China Quarterly, No. 170 (Jun., 2002), pp. 283-303.

[36] Howell, J. All-China Federation of Trade Unions beyond Reform?, The China Quarterly, No196, pp845-863, Dec. 2008.

[37] Ibid.

[38] Mingwei Liu, Union Organisation in China, Industrial and Labor Relations Review, 64(1)30-52, Oct 2010.

[39] Ching Kwan Lee, From the Iron Rice Bowl to Informalization: Markets, State and Workers in a Changing China. Cornell U.P., 2011.

[40] Mingwei Liu, Op. cit.

[41] Pun and Chan, Global Capital, …, Op. cit.

[42] CLB, 24 April 2014, clb.org.hk.

[43] In These Times, 25 June 2015.

[44] Reuters Business News, 7 April 2014.

[45] CLB, 27 July 2015, , clb.org.hk.

[46] Foreign and Commonwealth Office, Op. cit.

[47] Rhomberg, C. A Turning Point for Chinese Workers? 02 April 2015.

[48] Economist, Guangdong Province Pioneers a New Approach to Keeping Workers Happy, 31 Jan. 2015.

[49] Hong Kong Federation of Trade Unions, Violence Against Workers in Artigas Factory, en.hkctu.org.hk.

[50] Chuang, The Criminalisation of Strikes, http://chuangcn.org/2015.

[51] Li Liao, et al., Family Finances in Urban China, J. Family Economic Issues, Vol 31 pp259-279, 2010.

[52] New York Times, 19 July 2013.

[53] Forbes Magazine, January 2013 and March 2014.

[54] World Bank, Challenge of High Inequality in China, Aug 2013.

[55] http//news.xinhuanet.com/English.

[56] Burnett, Op. cit.

[57] Nie, L. et al. Gender, Family, Socioeconomic Status, and Work Values in China, Am. Int. J. Soc. Sci. Vol. 3 No. 2; March 2014.

[58] BBC News 17 Oct. 2013.

[59] People’s Daily, June 2012, quoted in Fincher.

[60] Fincher, L. Leftover Women, Zed Books. 2014.

[61] Bienkowski, B. China’s Babies at Risk from Soot, Smog. Environmental Health News, April 2014.

[62] Fincher, Op. cit.

[63] The Telegraph, 16 March 2013.

[64] Lenin, V. Speech on Affiliation to the British Labour Party, May 1920, CW 31: 257-263.

[65] Trotsky, L. Marxism and Trade Unions, Plough Press, 1968.