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How and Why China Has Succeeded Where USSR Failed

June 13, 2019 11 comments

A few days, I started writing a post about why China will defeat USA in any long-term trade or ‘cold’ war. However, it quickly became obvious that many concepts in that post had not been well explained in previous ones. I then realized that an older draft post (abandoned over a year ago) contained enough elements for a prequel post. Readers should, therefore, see this post as a partial explanation for why the challenge posed by China to the terminally-ill american empire is fundamentally different from anything the later has encountered in the past, and indeed beyond what the anglo- mind is capable of imagining. As you will see in a future post, there is a reason why I chose to say that it is beyond the comprehension of “western” minds.

Let us now get back to the topic of this post, namely why China succeeded in spades at what the erstwhile USSR failed. USA, since its inception, has faced only two semi-credible threats, the first being Japan during WW2. However, as any person with a half-decent map and some basic stats about the two countries in 1940 can figure out, the manufacturing base of USA at that time was about 10 times larger than Japan. Moreover it’s land area was about 1/20th of contiguous (lower 48) USA and hence had far fewer natural resources. And ya, I am aware that Japan had occupied Korea and some parts of China- but it was never a close fight. Even Isoroku Yamamoto (of Pearl Harbor attack fame) was quite open about USA being the inevitable winner if the war lasted over one year. In other words, neither pre-WW2 nor post-WW2 Japan was ever a real threat to USA.

USSR, on the other hand, was land and resource rich (about twice the area of lower 48). While its population was a bit less than USA, especially in the immediate aftermath of WW2, it rivaled and often surpassed USA in areas ranging from high technology to the manufacturing and deployment of large numbers of diverse weapon systems. Furthermore, it was able to build its own sphere of influence in eastern Europe after WW2. So why did a country with more natural resources than USA, about the same population (in aftermath of WW2), tons of very smart scientists and military tacticians finally implode in 1991. Many Americans attribute it to all sorts of solipsistic bullshit, ranging from “socialism”, “Reagan”, “Afghanistan” to even more ludicrous ones such as “race” and “people yearning for human rights”.

In my opinion, the real reasons why USSR finally collapsed in 1991, but China just kept going and went on to become the world’s largest economy in real terms about a decade ago has to do with reasons which the vast majority of Americans are either unwilling or incapable of understanding. So let us start listing them, though not necessarily in order of importance.

1] China had both the size and population advantage. While is has about half the area of USSR, China is a bit larger than the lower 48 of USA. Moreover, unlike USSR (or Russia) it’s population has been at least 3-4 times larger than post-ww2 USA. Possessing a large enough landmass and population translates into a very respectable amount of natural resources and enough people to properly exploit those resources. With the exception of oil and a handful other minerals, China is large and populous enough to be internally self-sufficient. It also helps that most of China is neither too hot nor cold and the only limiting factor for human habitation is availability of water in its western half. But that is no different from the South-Western quadrant of USA being either a desert of semi-arid region. In other words, China is more than the equivalent of USA in Asia.

2] Issues surrounding race and culture. One of the most infrequently talked about, but important reason, why USSR seemed like a follower to the “West” and generally susceptible to its influences has to do with how most people in that country (and in Russia today) saw themselves. For a number of historical reasons, Russians have always seen themselves as white and western, perhaps a bit distinct from the “western” mainstream- but still white and western nonetheless. In my opinion, this inability to create a distinct cultural identity led to many other pathologies and bad decisions which shall be partially enumerated later in the post. Chinese, for obvious reasons, did not have that option and neither were they interested in being white (at least most of them).

3] Many of you might have noticed that post-1980 China seems to have stable and good to OK relations with a very diverse range of nation states all over the world. Contrast this to USSR, whose relations with countries in Africa and Latin America were colored with racial paternalism- though not as bad as USA. But why was that so? Well.. USSR (and Russia today) unfortunately bought into the whole white racial supremacy bullshit- which is ironic since we all know what Hitler thought of Slavic people. To be clear, I am not implying that Chinese people are not racist- just far more pragmatic and not so obsessed with race.

4] One of the other visible differences between China of erstwhile USSR concern administration. It is no secret that China, and east-asian countries in general, seem to have this bureaucracy thing figured out far better than the west. The most relevant differences between the two, in this area, concern how responsibility is delegated. More specifically, east-asian bureaucrats have far more latitude and autonomy to get things done- as long as they didn’t fuck up too badly and embarrass the central government. This translates into a far more robust, flexible and innovative system run by fairly competent people with skin in the game. There is a reason why China achieved in 20-30 years what took many other nations over a century.

5] Pragmatic and flexible ideology. Unlike USSR, China (except between late 50s-late 60s) was never obsessed with ideological purity. They just tried to solve problems facing them in the most optimal manner, given their resources and ability. That is why, for example, China was fine with people becoming rich after 1980s. They, correctly, saw the influence of capitalists on governance rather than its mere presence as the real problem. One of the reasons why things went so bad in Russia between 1991 and 2000 was that the system was run by capitalists at the expense of everybody else. China, on the other hand, focused on curtailing the political power of capitalists rather than making sure nobody got rich. We can all see who got it right.

6] China never really bought into western ideas of money, finance and “austerity”. Many of you heard about how material conditions for average citizens in USSR weren’t that good and quality of consumer goods were bad. But why was that so? Why couldn’t USSR spend enough to ensure that the quality of life for its citizens was good. Well.. it comes down to how they saw money and finance in general. Long story short, they bought in the “western” idea of money as a limited resource over which the government has little to no control. China simply decided to go down the MMT route, before it was even a thing. That is why China never seemed to be short of money to build new cities, apartment blocks, roads, airports, high-speed railways, factories, shopping malls, universities, research institutes etc. It is profoundly ironic that an allegedly communist country displays the best practical understanding of economics.

7] China understands censorship far better than USSR and the supposedly “free West”. One of the other realities of life in USSR, as told to me by former inhabitants, was that open humor and mockery of the establishment was not a good idea. Contrast this with how the Chinese system works, where polite criticism of the government (especially as far its ability to solve problems) is not especially problematic. While making off-color jokes about the government on the internet might get you temporarily banned or a visit from the authorities, very few end up in prison for being loud on social media. Also, unlike USSR, the Chinese government is not interested in regulating the private lives of its citizens beyond what is necessary to keep up external appearances. But by far the best censorship of dissent involves making sure that people have enough jobs, opportunities to make more money, reasonably good and affordable consumer goods and no persistent shortage of essentials.

And now I can write up the rest of that post about why China will prevail over USA in any long-term trade or ‘cold’ war.

What do you think? Comments?

State Communism was Based in Capitalism and Social Conservatism: 1

March 11, 2018 8 comments

A few months ago, I decided to write a short series about how socio-economic problems which plague post-2008 USA are oddly similar to those which brought down ostensibly “communist” countries in the late 1980s. While I did complete and post the first article in that series, a feeling that I was close to uncovering an even deeper basic similarity between the two allegedly different systems made me hold off writing the second part at that time. While I do plan to finish up that one soon, the topic I am going to discuss today is distinct enough to deserves its own separate post or two.

Let me start by making a claim, which might initially sound rather strange to most of you. It is as follows: ‘State Communism, in both, ideology and practice, is just another flavor of Capitalism in combination with a certain kind of social conservatism’. Some will counter by pointing out that state communism didn’t allow official large-scale private ownership of property or money. Others will highlight that countries under state communism were often socially more progressive than their capitalist counterparts. While both are factually correct, neither one addresses the central reasoning behind my claim.

In my opinion, the key to defining capitalism, state communism, socialism or any other ‘-ism’ lies in observing how that ideology functions in real life and what unspoken assumptions are made by its principal practitioners. With that in mind, let me ask you a simple question- Why was the quality of life for the median person living in countries under state communism in eastern Europe always inferior to those in western Europe? While a good portion of blame can be placed on the design of almost all institutions (functional monopolies) in those countries and “professional managers” who ran them into the ground, it is worthwhile to ask ourselves- How, and why, was all of this normalized and “rationalized” by those in power?

In other words, how did those in power within those countries justify their relative inability to provide their citizens with nice apartments, sweet cars and other consumer goodies? To make a long story short, such glaring deficiencies were usually explained away as being the result of “not enough resources” or “other more pressing priorities”. Oddly enough, this is the same reasoning used by politicians and establishment pundits in USA to explain how the “exceptional” country which spend trillions on useless defense related toys somehow cannot afford to provide universal healthcare, inexpensive higher education and a decent social safety net for its citizens.

So how can countries in western Europe continue to provide all of those goodies to their citizens? Also, why were they generally unable to do that before 1945? What changed? Also, why are public services in first-world countries generally of good quality, relatively inexpensive and universally accessible? Well.. the simple answer to most of those questions is that services which are considered and treated as social goods rather than as opportunities to make ever-increasing amounts of monetary profits end up being inexpensive, universally available and of high quality. Conversely, those treated as avenues for the enrichment of a select few end up becoming expensive, scarcer and of lower quality.

But how does any of this work in systems where official accumulation of wealth and property was banned? Under those conditions, shouldn’t all public services be seen as social goods and be therefore universally available and of high quality?

No.. not really, and here is why. Any official ban on private accumulation of property or money has, by itself, little impact on the practice of capitalist ideology. All laws and regulations will be compromised and circumvented by clever crooks- if they are allowed to get away with it. To understand what I am really talking about, we have to first spell out the end goal of capitalism and the ideology beyond it. The end goal of capitalism and many other -isms is to impoverish others by depriving them of resources while simultaneously accumulating resources created by the labor of others for no reason than to deprive those others.

In that respect, the only difference between capitalism and feudalism is that the later uses overt direct force and appeals to tradition and religion, while the later uses the pretense of “liberal enlightenment”, impersonal violence by a “secular” state appeals to the greed of willing idiots. Have you ever noticed that capitalism did not improve the quality of life for the median person in western countries until after WW1. So why did over a hundred years of unbridled capitalism, “free trade” and the industrial revolution have little positive effects on the lives of most people in the “west”? Maybe we should have given it more time? Perhaps it was not “pure enough”?

And this brings us to why the aftermath of WW1 and WW2 witnessed a lot of progressive and sustained improvements in the quality of life. To (once again) make a long story short, both wars and their aftermath destroyed and discredited old institutions, hierarchies and ways of thinking to the point where a lot of the previous status quo was simply unsustainable. It just happened to be the case that ethic nationalism, “free trade” and laissez-faire capitalism was the previous status quo. And that is also why ‘neoliberalism’ (aka recycled liberal capitalism) did not become respectable till the mid-1980s which is almost four decades after the end of WW2.

But, what does any of this have to do with my claim that the ultimate failure of state communism had a lot to do with it being based in capitalist ideology?

Well.. remember how earlier on in this post, I talked about the excuses used by the elite (1%) in countries under state communism to explain their inability to provide enough quality consumer goods to their citizens. You might remember something about how they justified chronic shortages, shoddy products and general deprivation by invoking excuses about “available resources” and “other priorities”. Now tell me, why did they choose excuses that are linked to cost and utility, when the government in those countries was free to create extra money to fund building of new houses, nice apartment blocks, sweet cars and other consumer goodies?

Isn’t that what China did to build up its industrial and consumer base in the last three decades? How could a country like China see the obvious solution and implement it in a manner that eluded all the countries under state communism in eastern Europe? Why did not Russia decide to do something similar in the 1960s and create enough extra money within its border and utilize that to build nice apartments, modern cars and consumer goodies for its citizens? I mean.. they certainly did that for building lots of modern weapons systems and other prestige programs during that time period.

I think that the reason why 1960-ear Russia did not do what 1980-era China did on a large-scale comes down to that counter-intuitive fact that elites in the former believed in capitalism far more than those in the later. The former could not think in ways which violated the sacrosanct beliefs and assumptions of capitalism. The later simply saw capitalism as another make-believe ideology which could be manipulated to facilitate whatever they wanted. And that is why China was able to seamlessly pull off something which the erstwhile USSR failed at, even though it was a far better position to do so.

In the next part, I will write about my thoughts on how the strong urge to enforce conservatism and traditionalism in erstwhile USSR to maintain social harmony and conformity ended up having the reverse effect and contributed to the ultimate failure of state communism in that country.

What do you think? Comments?

Some Thoughts on Why USA Cannot Win Cold War 2.0: Part 1

September 18, 2017 3 comments

One of the major undercurrents running through a number of current standoffs and conflicts involving the USA (supported by its west European vassal states) and a number of other countries such as Iran, North Korea, Russia, China etc can be stated as follows: USA is acting as if it can “win” all these conflicts in a manner similar to how, it believes, it “won” Cold War 1.0.

To put it another way, the establishment in USA believes that it can win conflicts against other countries (small and large) through a combination of economic policy and propaganda. A corollary of that is the widespread belief among establishment-types in USA that those conflicts will never reach the point where are an existential threat to the survival of USA.

While I have previously touched on this topic in some previous posts such as why comparing income across countries in USD is detached from reality, the focus was mainly on socio-economic effects of this disconnect rather than its strategic implications. I also wrote another post about why Russian military capability was far stronger than its GDP as measured in USD would otherwise imply.

The gist of my argument was that comparing the GDP of countries in USD dollars is quite meaningless if the costs of functionally equivalent products and services, as measured in USD, was substantially different. Furthermore, the ability to produce certain products (such nuclear bombs and ICBMs) are far more valuable than their cost in resources or manpower- especially if both are almost completely indigenous.

Anyway, getting back to the topic of this post- you might have noticed that establishment in USA is devoting a lot of effort in an attempt to start another Cold War by actions such as implicating Russian journalistic ventures as devious propaganda outlets, endless blathering about Russian interference in the 2016 election, arming Ukraine against Russia, economic sanctions on Russia for taking back Crimea, defaming Russian sport starts and Olympic athletes through western regulatory bodies, targeting Russian companies selling products and services in USA and more.

You might also have noticed that these measures have not really affected the resurgence of Russia as country since Putin came to power in 2000. Such behavior has, however, done a wonderful job of convincing even otherwise skeptical Russian citizens that they can never have good relations with USA. We can see a similar, if less public, conflict developing between China and USA on a number of issues such as maritime boundaries in the south china sea, trade disputes and many others. Yet, they do not address the central issue linking these seemingly unrelated conflicts- which is the irreversible decline of economic and military power of USA versus China and, more generally, the rest of the world.

It is no secret that the USA, in its current form, is a nation and system in terminal decline. While there have been a few years (like the mid to late 1990s) when things looked good for USA, the overwhelming long-term trend is towards decline and this has been especially obvious since the financial crisis of 2008. As I frequently pointed out in my older posts, the inability of USA to win (or even appear to win) wars in countries like Iraq and Afghanistan have not helped its public image.. to put it mildly. In fact, the USA has not been able to decisively win a single war since the end of WW2- which is a bit over 70 years.

The current standoff between North Korea and USA is another example of the huge gap between the projected public image of USA and the reality as seen by the rest of the world. As an example, consider the bullshit and propaganda spewed by american mainstream media about the capabilities of their anti-ballistic missile (ABM) systems. Now ask yourself- if american ABM systems were as effective as claimed by the establishment, why would USA give a flying fuck about DPRK developing and deploying ICBMs?

The thing is, american ABM systems “seem” to only work under highly rigged test conditions and are probably worse than useless against even a small-scale attack by IRBMs and ICBMs. China or Russia, both of whom incidentally border DPRK, are unwilling (and unable) to do anything about DPRK’s nuclear and ICBM program. In fact, all those missile launches and nuclear tests by DPRK have helped them humiliate USA on the world stage and expose its real-life weaknesses.

And this brings me to the central idea of this series of posts, namely that USA is incapable of winning Cold War 2.0.

But before we go there, let us quickly recap the reasons why USA thought it “won” Cold War 1.0. As many of you know, the establishment in USA believes that it was largely responsible for the collapse of USSR in 1991, which marked the end of Cold War 1.0. While this belief might sound pleasing to jingoistic ears, the reality is rather different as the USSR started experiencing serious socio-economic problems because of the rigid and unresponsive nature of their version of state communism as early as the late 1960s. It was these systemic problems, rather than american pressure, which ultimately led to the collapse of USSR in 1991.

China, on the other hand, was able to avoid all those problems because of systematic socio-economic reform during the same time period. These reforms have been so successful that China, adjusted for PPP, is the largest economy in the world today. The point I am trying to make is that the apparent “victory” of USA in Cold War 1.0 had more to do with the failings and sclerosis of one particular version of state communism in Russia and eastern Europe than the american system “winning” anything.

This inconvenient fact has not stopped the american establishment and its lapdog “intellectuals” from proclaiming ‘the end of history’ and ‘beginning of a new world order’ in 1991. Of course, things did not go as “planned” especially after 2001, Iraq War 2.0, Afghanistan War and then the financial crisis of 2008. Such setbacks have, however, not dimmed the ardor of establishment types in Washington D.C to re-establish a ‘new world order’ centered around USA. As many of you are only too aware of, the ground reality in USA for the 99% simply does not support the establishment belief that USA will be able to maintain its current position in the world.

In the next part of this series, I will explore how rapid industrialization in the rest of the world within the previous two-three decades (in combination with simultaneous un-industrialization of USA and the ‘west’) has fundamentally shifted the real power balance and possible outcomes for any Cold War 2.0-type strategies deployed by establishment in USA. Spoiler alert: real-life outcomes of such conflicts are heavily rooted in real-life capabilities and abilities rather than impressive but empty posturing and bullshit.. I mean propaganda.

What do you think? Comments?