Two Paths, Two Futures

From: English Edition of Qiushi Journal Updated: 2013-05-28 17:49
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The future of the world will be decided by the vying of two competing systems and two competing paths

The world is currently undergoing a period of major development, major change, and major adjustment. In the midst of these complex and profound changes, a new political and economic landscape is in the process of being formed. In 2008, the international financial crisis, which grew out of the U.S. subprime mortgage crisis, inflicted a heavy blow to the U.S.-led, developed capitalist countries of the West, weakening the capacity of their international monopoly capital to dominate global economic development. In contrast, the overall strength of socialist China, other emerging markets and developing countries has continued to grow. This has resulted in further, positive changes to the international balance of power, which continues to shift towards multi-polarization. According to data from the International Monetary Fund (IMF), emerging and developing economies are coming to represent an increasingly large segment of the world economy. Having been responsible for around 60% of the world’s economic growth in the year 2010, these economies are now the primary driving force behind global economic growth. While the U.S. is still the largest bastion of capitalism and the world’s “only superpower,” its hegemony has clearly been weakened. This fact is evidenced by its constantly declining share of the world economy, which dropped to 23% in the year 2008. At present, there is much discussion and guessing in the West as to when socialist China will replace the U.S. as the world’s largest economy, and when certain other emerging markets will overtake developed capitalist countries. From a certain perspective, this demonstrates that these people are beginning to cast doubt on the ability of the U.S. to lead world economic development, and on the superiority of the capitalist system. It is a sign that they have lost their faith in this system. 

An anti-capitalism march in Moscow on September 9, 2012. / Xinhua/AP

A decade or two ago, the representatives of the capitalist bourgeoisie experienced a surge in confidence as they joyed at the sudden change in the international situation triggered by drastic changes in the Soviet Union and Eastern Europe. Francis Fukuyama’s “End of History” is perhaps the most typical example of this phenomenon. Fukuyama claimed that history had come to an end, that capitalism had finally triumphed over communism, and that the Western capitalist path was an inevitable course of human history. However, fact has since proved how flawed this assertion was, and even Fukuyama himself has been forced to amend his theories. Another example is neo-imperialism, a so-called new world order for the age of globalism, which certain Western scholars (including left-wing scholars) have proposed in light of the expansion and strengthening of Western monopoly capital under the conditions of globalism. Such scholars believe that world history has undergone a “post-modern transformation.” They maintain that the age of imperialism has passed, that nation states will die out, and that a new political and economic order has already formed, an important characteristic of which is the emergence of “new empires.” In fact, this theory amounts to an assertion that capital empires have already established total global dominance. But as with Fukuyama’s “End of History,” this theory is also groundless. While it must be acknowledged that imperialism has yet to step down from the stage of history, being as powerful as it still is, the idea of capital empires ruling the world is nothing but a fantasy clung to by certain individuals. Be it their U.S. dominated “American Empire” or their EU-derived “European Empire,” these are utopias that can never come true. The reality is that there are two basic systems in the world at present, one being capitalism, and the other being socialism. The conflict between these two systems and two paths constitutes one of the major conflicts in the world at present, and the struggle between them will decide the future of the world. 

The financial crisis has dealt a heavy blow to the capitalist system, and could be the turning point that ushers in the decline of monopoly capitalist rule

The financial crisis of 2008, whose breakout left the entire capitalist world in shock, has yet to come to an end. At present, the prospects for economic development remain full of uncertainty. In addition to its extended duration, the current financial crisis has also been felt over a wide scope, spreading to almost all major developed capitalist countries, including the U.S., EU countries and Japan. Given how severe its impact and consequences have been, it is fair to say that it has become an economic and social crisis that is threatening the entire capitalist system. The so-called “new empires” (the U.S. and the EU), which we have mentioned previously, are still engaged in a bitter struggle to free themselves from the mire of economic crisis. Upon being re-elected, U.S. President Barack Obama was faced with the challenge of averting a “fiscal cliff.” For years, the American government has relied on fiscal deficits to get by. With an annual deficit in excess of one-trillion dollars, the country has accrued a national debt of astronomical proportions. Clearly, the U.S. will struggle to maintain its global hegemony if this should continue. The situation in the EU is even worse. The sovereign debt crisis is prominent, with some countries descending so deep that the very survival of the Euro and the European Union is at stake. Unemployment is serious, with the rate of unemployment in the euro zone reaching a record breaking high of 11.6%. In some countries, the overall rate of unemployment is higher than 25%, while youth unemployment in particular is as high as 50%. Many renowned economists have made bleak projections for the prospects of economic development in the capitalist world. At the same time, they have begun to reflect on the events that have transpired, seeking to identify the causes of the current crisis. Some have focused their analysis on government policy and managerial techniques (such as strengthening financial regulation); while others have delved into the systemic roots of the crisis. At present, neoliberalism is generally singled out as the chief cause of the financial crisis. This is both correct and necessary. Criticism of neoliberalism should be elevated to criticism of the capitalist system itself, so that the inherent links that exist between neoliberalism and modern monopoly capitalism can be exposed. It is no accident that neoliberalism has become prevalent along with the acceleration of economic globalization. This is because neoliberalism is best geared to the global expansion of international monopoly capital, allowing it to use its advantage to exploit surplus value around the world and gain the maximum profit. Given that neoliberalism represents the core requirement of modern monopoly capitalism, its failure comes as a sign of the crisis that capitalism is currently experiencing. The current financial crisis could be the turning point that ushers in the decline of monopoly capitalist rule. Capitalism still possesses developed productive forces and advanced technology. Although in the long term it will eventually make way for the more advanced system of socialism, the capacity of capitalism to make self-adjustments in order to overcome crisis cannot be underestimated. Given so, it is possible that a certain degree of capitalist resurgence and development may be seen. At present, capitalism boasts a global edge from an economic, political, cultural, and military perspective. But despite this, however, the fact remains that modern capitalism is now in decline, its golden age having passed.        

Socialism represents the direction in which history will advance. However, its triumph will involve a long, bitter, and complex struggle

Despite showing visible signs of decline, the financial empire is not necessarily on the brink of collapse. The replacement of modern capitalism by the more advanced system of socialism will not happen overnight. History tells us that the replacement of an outdated social system by a new social system can be a drawn out, tortuous, and painful process, with the possibility of repeated setbacks along the way. The departure of the ancient slavery system; the fall of the Roman Empire; the overthrowing of feudalism by the bourgeoisie—these were all processes that took centuries to complete. As a new form of social system, the socialist system has been around for less than one hundred years. Therefore, the replacement of capitalism by socialism on a global scale will involve a drawn out, bitter, and complicated struggle.

The path that a country chooses to follow does not depend on the will of individuals in that country. Moreover, the making of this choice is not a natural process whose outcome is determined by economic factors alone. Rather, this choice is the result of a complex process involving multiple interacting factors, such as international and domestic situations, objective realities and subjective considerations, the balance of power between classes, the nature of social conflicts, as well as economic, political, social, and cultural factors. Marxists are not fortune tellers; they cannot accurately predict exactly how socialism will develop in the 21st century. All they can do is objectively analyze social trends in light of realities in the world at present, and propose feasible goals that can be worked towards on that basis. Looking at the state of the world at present, it is clear that monopoly capitalism is undergoing a profound crisis, and that it is on the decline. This demonstrates that capitalism is by no means an inherently rational or everlasting system. On the other hand, socialism with Chinese characteristics has captivated the world with its incredible achievements, demonstrating the superiority of the emerging socialist system. From a global perspective, the success of socialism with Chinese characteristics will provide the socialist movement with new opportunities, new possibilities, and new horizons. 

(Originally appeared in Red Flag Manuscript, Chinese edition, No.1, 2013)      

Author: Former Vice-President of the Chinese Academy of Social Sciences

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