China is an advanced capitalist economy integrated into the World market. Wages for non-skilled labor in Chinese factories are as low as 300$ a month (or lower), a small fraction of the minimum wage in Western countries.
This article focuses on China’s capitalist system under a “Communist” label. America is an import led economy with a weak industrial and manufacturing base, heavily dependent on imports from China.
The factory price of a commodity produced in China is of the order of 10% of the retail price in Western countries. Consequently, the largest share of the earnings of China’s cheap labor economy accrues to distributors and retailers in Western countries.
In recent developments, Trump has duly instructed his administration to impose tariffs on about $50 billion worth of Chinese imports, but trade sanctions directed against China would immediately backlash against America.
“Made in China” is the backbone of retail trade in the USA which indelibly sustains household consumption in virtually all major commodity categories from clothing, footwear, hardware, electronics, toys, jewelery, household fixtures, food, TV sets, mobile phones, etc.
Importing from China is a lucrative multi-trillion dollar operation. It is the source of tremendous profit and wealth in the USA, because consumer commodities imported from China’s low wage economy are often sold at the retail level more than ten times their factory price.
Production does not take place in the USA. The producers have given up production. The US trade deficit with China is instrumental in fueling the profit driven consumer economy which relies on Made in China consumer goods.
Chinese policy makers are fully aware that the US economy is heavily dependent on – Made in China -.
And with an internal market of more than 1.4 billion people, coupled with a global export market, these veiled threats by President Trump will not be taken seriously in Beijing.
Many Marxists believe that the reemergence of “capitalist characteristics” in the People’s Republic of China had its roots in post-1949 socialist construction rather than in the semi-colonial structures prevailing in China prior to 1949.
In 1978, an “Open Door Policy” was put forth by Deng Xiaoping alongside the launching of China’s Special Economic Zones (SEZ) in Shenzhen and Xiamen. These reforms constitute the backbone of China’s cheap labor export economy.
While China plays an important and positive balancing role on the geopolitical chessboard, it does not constitute a viable “socialist” alternative to Western capitalism. In contrast to the USA, however, China has no imperial ambitions.
China’s has currently, according to official figures[ 275 million (2015) ] 287 million in 2017 internal migrant workers employed in the cheap labor export economy, construction and infrastructure projects as well as in the urban service economy.
China’s 287 million migrant workers also constitute the driving force behind the development of infrastructure, roads and transport corridors not to mention the PRC’s “Belt and Road” Eurasian trade and investment initiative.
Global Research California / ABC Flash Point news 2018.
Cheap Labor Factory?
Made in China says the label?