How communist is China, anyway?

Answers to your questions about the news.
July 26 2010 6:57 PM

How Communist Is China?

They sure buy a lot of cars for a society built on collective ownership.

For a Communist country, China is not without capitalist luxuries. Click image to expand.
For a Communist country, China is not without capitalist luxuries

General Motors sold more cars in China than in the United States in the first half of 2010, and China now accounts for one-quarter of the company's global sales. That seems like a lot of capitalism for a country that calls itself communist. How communist is China, really?

Not very. Since the end of the Cultural Revolution in 1976, China has all but abandoned the tenets of classical marxism, including collective ownership of the means of production. Nowadays, just about everything is at least partly privatized. Whereas the Chinese Communist Party under Chairman Mao owned every factory and farm in the nation, the economy is now a patchwork of public and private businesses. Schools can also be state-run or private. Entitlements have also been cut way back since the days of true communism, with minimal state-provided health care and social security programs. We associate socialist countries with confiscatory tax rates, but taxes aren't especially high in China. (Chinese corporations pay 25 percent and individuals between 5 and 45 percent—numbers roughly comparable to thosein the United States.)

That said, the Chinese government still controls major aspects of the economy and society. For example, just about every Chinese bank is state-owned, so the government decides which businesses and individuals will get the most favorable loans. The domestic media are entirely state-owned as well and offer uniformly favorable political coverage. Perhaps the biggest vestige of classical communism is the fact that every square inch of land in the country still belongs to the government. (People and businesses can own houses and other property.)

Politically, China is as Communist as ever. The country operates under the highly centralized, single-party rule of the Communist Party. Every region, whether it's a province or a city, has two sets of leadership: local government functionaries and Communist Party officials. While there is overlap between the two groups—after all, government workers must be Communist Party members—the top local government leader must always answer to the top party leader. The governor of a province might make day-to-day decisions about filling potholes and snow removal, but the party official controls macro decisions like which businesses get state money and prime real estate.

Advertisement

The irony is that the Communist leadership structure is geared toward capitalist ends. For example, regional leaders are evaluated every year based on economic growth in their domains. That gives them incentives to drive innovation however possible—sometimes by fostering healthy competition among companies and other times by encouraging a monopoly. The system inevitably produces high levels of corruption, as local officials collect kickbacks from the companies they help.

Got a question about today's news?  Ask the Explainer.

Explainer thanks Ted C. Fishman, author of China, Inc.: How the Rise of the Next Superpower Challenges America and the World; Kenneth Lieberthal of the Brookings Institution; and Stapleton Roy of the Woodrow Wilson International Center for Scholars.

Like  Slate and the Explainer on Facebook. Follow us on Twitter.

TODAY IN SLATE

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

Two Damn Good, Very Different Movies About Soldiers Returning From War

The XX Factor

Lifetime Didn’t Think the Steubenville Rape Case Was Dramatic Enough

So they added a little self-immolation.

Politics

Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

Trending News Channel
Sept. 19 2014 1:11 PM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Weigel
Sept. 20 2014 11:13 AM -30-
  Business
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
  Life
Quora
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Slate Picks
Sept. 19 2014 12:00 PM What Happened at Slate This Week? The Slatest editor tells us to read well-informed skepticism, media criticism, and more.
  Arts
Brow Beat
Sept. 20 2014 3:21 PM “The More You Know (About Black People)” Uses Very Funny PSAs to Condemn Black Stereotypes
  Technology
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 20 2014 7:00 AM The Shaggy Sun
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.