Thirty years ago, China was one of the world’s poorest and weakest countries. Now it threatens Americans’ military and economic dominance in the Asia-Pacific region. This is one of the most significant developments of the 21st century. Maybe China will never become strong enough to challenge the United States for global dominance, but a powerful state is now undermining American dominance in one of the world’s most important trade and manufacturing regions. That’s rapidly changing the rules of the game. The world is becoming more polarised as China’s rulers bring more countries into their trade networks, and the United States moves to repel them. Western governments are reacting with increasing alarm. Hysterical anti-China campaigns are being whipped up in the media to prepare the populations of countries like the US and Australia for what will likely be a grim period of conflict to maintain the supremacy of the established Western imperialist powers. Pressure is mounting: pick a side in the clash of Great Power rivals.

Socialists need to be ready to face the challenges of the coming period. Above all, we need to understand the nature of the contenders. In China’s case, this isn’t a straightforward task. China is ruled by a Communist Party, and has been for seven decades—but it’s a “Communist” party more committed to international free trade and globalisation than many major pro-capitalist parties in the West. The state controls all of China’s most important industrial sectors and the financial system, and treats the private sector as a tame subordinate—yet China is producing new billionaires faster than anywhere in the world, has only the shadow of a welfare state and produces more consumer commodities for massive corporations like Apple and Honda than any other country. What kind of a society is this, that so freely and easily mixes the features of a capitalist market economy with an old-school Stalinist dictatorship? Is it “Communist,” as Mike Pompeo and Xi Jinping (and some sections of the left) say? Is it capitalist? Or something else entirely?

Capitalism doesn’t mean just having more private than state-owned industry, more free markets than government planning. Capitalism is a social system, not a set of policies. The most basic relationships in a capitalist society, the ones that have the most impact on what it looks like and how it functions, are the relationships between workers and bosses, and between the bosses themselves. Those vary in the details in different industries and countries, but the basic structure is always the same. Workers, dispossessed from the means of production, must sell their time to bosses, in exchange for wages. Capitalists, the minority who control all of the important productive property in society, pay workers wages, but only in order to extract a surplus from the workers’ labour. Producing a surplus in a competitive society compels capitalists constantly to update their technology. If they fall too far behind in this race, they run the risk of being driven out of business by a more efficient rival. Capitalism is essentially the sum of these relationships: the exploitation of workers driven by the competitive accumulation of capital.

China clearly conforms to this definition. The working class in China is the largest in the world, hundreds of millions strong, 300 million of whom are internal migrant labourers—poor rural workers who travel to the cities and factories where they don’t have even the minimal rights afforded to city-born workers, can be deported home at any time and often live where they work in vast factory dormitories. The staggering wealth they have generated for both Chinese and foreign-owned corporations doesn’t belong to them.

China’s economy has doubled in size roughly every eight years since the late 1970s. Vast resources have been ploughed into a massive program of capital accumulation, funded by foreign investment, low wages and high household savings resulting from a non-existent social safety net for workers. According to the World Bank, the percentage of China’s GDP consumed privately has hovered around 35 percent for decades, while gross fixed capital formation—basically, the amount of the economy allocated to developing the means of production—stands at a whopping 43 percent as of 2018. (By comparison, in Australia, household consumption in 2018 took up 56 percent of GDP, while fixed capital formation was only 24 percent.) While the state and the capitalist class obsessively expand industrial output and invest huge sums in infrastructure and urban development projects meant to facilitate growth, workers have to go on strike to force their bosses to pay even the minimum health insurance and retirement contributions they are theoretically obliged by law to pay. China’s workers are an exploited class, dispossessed economically and disenfranchised politically, in a society geared to the accumulation of capital.

The result is the same as in any capitalist country in the West: wealth and privilege accumulating in the hands of a few, and misery and hardship shared out among the many. In the 12 months since COVID-19 first struck Wuhan, US$1.5 trillion has accumulated in the hands of China’s richest 2,000 people. The Chinese billionaire club (measured in US dollars) increased from 521 individuals to 878—now surpassing the number in the US. “The world has never seen this much wealth created in just one year”, said Rupert Hoogewerf, author of the Hurun China Rich List 2020. “At this rate, expect to see ten or more Chinese entrepreneurs break through the US$100bn mark within five years.” The rich in China now generate 35 percent of global spending on luxury goods, compared to 22 per cent in the US and just 17 per cent for all of Europe.

China’s state plays an important role in ordering and regulating economic life, in a way that makes it look a little different to the kind of capitalism that predominates in the West. But these are distinctions between sub-sections of a single whole, the world economy with its integrated systems of production and distribution, not separate systems. China and the West are competing, to potentially immensely destructive effect, over who gets the biggest share of the spoils. But at the same time, China’s capitalists benefit from the enormous flows of American and international capital and technology, while American and international capital benefit from the repressive brutality of the Chinese state and intense exploitation of Chinese workers.

And in the final analysis, China’s social system shares an identical inner structure with the capitalist societies of the West. That’s why China’s rulers can combine and recombine private and state property, state planning and market competition into whichever configuration they find most useful in pursuing a given goal.

The basic class relationships that define the capitalist system exist in every part of China’s economy: workers are exploited by a minority ruling class engaged in various kinds of accumulation-compelling competition. They may not always directly compete on the market themselves, but China’s state-owned enterprises play a key role in that competition, helping to provide finance and essential inputs to private firms and to maintain the tight control over labour that is essential to the explosive growth of the economy as a whole.

They’re also central to a different kind of competitive accumulation, one driven by military rivalry rather than the hunt for profits. The pressure of military competition has defined China’s economy since long before there were Chinese billionaires. For 70 years, military competition has forced its rulers to industrialise China’s economy as rapidly as possible, to reduce China’s vulnerability to the more advanced military capacities of the United States. China began as a poorer, less technologically advanced economy than the US, which is not only richer and more powerful, but already dominates the world system of imperialist alliances.

China’s ruling class has relied more on centralised planning and state direction to accelerate development. But there’s nothing socialist about that. The very same “Communist” party has overseen both the construction of the command economy and its marketisation, based on which best served the interests of the Chinese ruling class at any moment.

When the Chinese state does intervene in the economy, it’s not holding back capitalism. It’s pursuing a program of massive economic expansion, financed by the suppression of working-class living standards and a now dwindling flood of foreign investment and technology transfers. But that capital accumulation is not only feeding a massive boom in the personal wealth of the capitalist class and state officials. It’s also building the economic basis for an increasingly intense arms race with the United States.

Chinese military outlays are now the second largest in the world. Xi Jinping has promised to forge a “world class” comprehensive combat force out of the rusty, bloated People’s Liberation Army. The armed forces have been kitted out with a lethal new array of cyber tech, missiles and vehicles, and their command structure has been simplified and decentralised for greater combat readiness. China’s navy can now deploy more warships than the US, though by tonnage it still lags behind. Now Beijing is preparing to triple the size of its arsenal of nuclear warheads and diversify its means of deploying them, all in the name of self-defence.

Governments of all stripes claim that they need the capacity to incinerate cities and slaughter millions for defensive reasons, right up to and beyond the point where they’ve invaded or attacked another country. This isn’t just propaganda. There is a logic to it: the anti-human logic of world imperialism. Capitalism is a world system dominated by national states. Every national economy depends on goods, resources and markets beyond its own borders in order to grow. The “defensive” interests of the national state extend well beyond those borders too. Defence of vital interests and aggressive, offensive exercise of power overlap for capitalist states. Capitalist “globalisation” goes hand in hand with imperialist conflict.

China’s crimes against humanity in Xinjiang illustrate the nature of this drive. The region is a corridor to Central Asia and Europe, making control of the area absolutely crucial from both an economic and military standpoint. Xinjiang is rich in mineral resources, natural gas and territory. Since 2009, when the CCP began a new push against the Uyghur people as part of a “war against terror”, profits pouring in from Xinjiang to Beijing have massively risen. Economic output doubled between 2013 and 2017 to US$36.7bn, and it now produces 85 percent of all Chinese cotton.

The threat of revolt by the oppressed Uyghur people and the demand for national independence would sabotage land trade routes to Europe in the CCP’s grand One Belt, One Road plan. Rather like the Israeli policy in the West Bank, the CCP believes that replacing Uyghur Muslims with Han Chinese will create a population more sympathetic to nationalism and Chinese chauvinism, guaranteeing political control over the whole region. Thus, it has incentivised the transfer of Han Chinese to the urbanised and developed areas. Meanwhile, perhaps one million or more Uyghurs are imprisoned in a network of concentration camps designed to crush completely the Uyghurs’ national identity and religious beliefs. It is one of the greatest crimes of the 21st century.

It’s textbook capitalism: oppression of national minorities, protection of strategic trade routes and militarily important territory, all as part of a longer-term plan to integrate as much of the world as possible into the nation-state’s sphere of influence, markets and military alliances.

One hundred years ago, Lenin called tsarist Russia “the prison house of nations” for ruling countries like Finland, Ukraine and Kazakhstan (a central Asian Muslim nation like Xinjiang) with an iron fist, banning expressions of national identity, imposing Russian language and religion and seeking even more territory to draw under tsarist autocracy. Russia was a poor and technologically backward country that could compete with the West based only on its sheer size and population. Lenin’s theory of imperialism aimed to turn Russian workers against the Russian empire, championing the right of oppressed nations to secede.

China today is nothing like imperialist Russia of 1914. It is the world’s second largest economy and largest manufacturer: two-thirds of all countries conduct more trade with China than with the US. It has foreign reserves of trillions of US dollars, an increasingly high tech military sector, and multinational finance institutions like the Asia Infrastructure Investment Bank that courts countries for Chinese investment. Compared to Germany, France or Japan—all imperialist powers—China has a lot more people, money, guns, soldiers, tanks and now capital.

The US remains the greatest purveyor of violence in the world today and the greatest military threat to the people of the world. But the decades in which it has held completely unrivalled power mark an exceptional period in the modern imperial era. The world wars and the Cold War were contests between major powers over who would control the lion’s share of the world. They were not unilateral US ventures. China’s rise has seen a relative weakening of US hegemony, and in that space great power rivalry has re-entered.

Those who back China over the US are not anti-imperialists: they are alt-imperialists. China’s adoption of the language and rhetoric of a “war on terror” as it mimics the West’s brutalisation of Muslim populations makes the symmetry plain.

And, as in any capitalist country, oppression creates resistance. The uprising of the people of Hong Kong is one of the most important in recent history. Practically the entire island mobilised behind a defence of democratic rights. For months, gigantic demonstrations faced off against the Hong Kong police. The youth of Hong Kong led one of the most impressive struggles of the 21st century. Hong Kong Polytechnic University became a battleground where the people fought against the regime

And just as both the Chinese government and the US want to portray China as “Communist”, they want to portray all resistance as a Western-sponsored plot, rather than what it is: a mass uprising, with politics that can be contested and that can develop in the struggle.

Tragically, China’s suppression of civil liberties has been done by a “Communist” party acting in the name of “socialism with Chinese characteristics”. That makes it so much harder for genuine socialist politics—an orientation to the organised working class, internationalism, the politics of solidarity—to form and break through into the mainstream. There have been signs of the potential for such a breakthrough in the uprising this time: workers have formed and joined new independent unions in droves in the course and aftermath of the most intense period of protests and street battles. But in the absence of an established leftist tradition in opposition to the Communist Party’s totalitarianism, all sorts of wrong and even rotten ideas can take root—even looking to the other great imperial power, the United States, as a potential saviour. When socialists ignore democratic struggles against Chinese capitalism, it only makes this more likely.

The courage and determination of Hong Kongers had the effect of fuelling and inspiring struggle around the world. Since it began, enormous movements have shaken Chile, Ecuador, Haiti, Lebanon, Iraq, Iran, Belarus, the US, Mali, Nigeria and Thailand. The movements share remarkable similarities: millions in the streets, occupations of government buildings, demands for democracy and justice. The ruling classes have responded the same everywhere: tear gas, riot police, crackdowns, curfews. Tactics for dealing with this repression, to “be like water” in the words of Hong Kongers, have spread from place to place. The radical potential in this kind of eruption of popular militancy should press home to every socialist the imperative to declare themselves in solidarity with the people of Hong Kong, and against the CCP.

At the same time, the immediate duty of socialists outside China is to oppose our own ruling class. It is Australian rulers who oppress workers on this continent, who dispossess Aboriginal people, imprison refugees, destroy the environment and spy on the population. Capitalists want the working class to believe that it needs the Australian state to protect it from the threat of China. This binds workers to the very people who oppress them. But socialists do not think that capitalism can be fought as part of national or imperialist blocs. Capitalism is an international system that draws people together from all over the globe into complex chains of production, trade and investment. Socialists should never side with our own state in its imperialist conflicts. But our responsibilities do not end there. We must extend solidarity to movements of the oppressed everywhere, to see their struggle as intimately connected to ours.

The West was happy to work with an iron dictatorship over the Chinese working class, until that dictatorship was strong enough to forge its own path. It was immediately after the bloody repression in Tiananmen Square in 1989 that foreign capital began to surge into China. It was clear to the rich nations of the time that an eternal supply of cheap labour was possible only so long as the Communist Party pressed on the necks of sweatshop workers. While the US-led order greatly benefited from China’s transformation from a poor rural country into the “workshop of the world”, its further transformation into an economic superpower confronts the US empire as one of the biggest challenges it has ever faced. For this reason, China’s crimes against humanity are no longer swept under the carpet, but are opportunities to attack an imperial rival and pay lip service to the superiority of the “democratic” West.

Socialists in the West cannot be indifferent—or worse, hostile—to a mass uprising against oppression simply because our own rulers pretend to support it. That is a complete betrayal of internationalism and working-class solidarity. But we don’t need to fall in behind the nationalist China-bashing of our own rulers. The best way to act in solidarity with the working class oppressed by China’s “Communists” is to struggle against our own rulers, while pointing out the commonalities of our shared struggles.

A socialist revolution in China would be the most momentous event in world history. Imagine the industrial, political and moral power of 600 million working people building a society based on workers’ democratic control of the economy for the good of humanity. Chinese workers and peasants could immediately seize the obscene wealth of the Chinese state and capitalist class, and rapidly raise their standard of living. They could dismantle the obscene police and military apparatus of the CCP, and plan for the massive expansion of sustainable industry. Such a revolutionary example would spill over to the millions more poor in South-East Asia, the Pacific, India, Pakistan, Central Asia. Chinese workers’ central position in global production means they could hold capitalism to ransom in many more countries, and trigger upheaval there too. A socialist revolution in China is the hope of the whole world. Socialists outside China must support every popular struggle that emboldens the oppressed and weakens the Communist Party and its vile capitalist and imperialist state, and take courage from such struggles in our fight against our own imperialist, capitalist rulers, whose hypocritical chauvinism is the mirror image of China’s capitalist politics.