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Hong Kong economy

Does Marxism have a role to play in Hong Kong?

Christine Loh says Hong Kong should not dismiss out of hand Marx’s observations about the failings of capitalism simply because of its own sensitivity to mainland influence, but see it as an opportunity to reflect on the role of government in poverty alleviation and development

PUBLISHED : Wednesday, 13 June, 2018, 12:34pm
UPDATED : Wednesday, 13 June, 2018, 6:34pm

What does Karl Marx have to do with Hong Kong? The easy answer is “nothing”, because Hong Kong is a capitalist society. 

Another answer may be that Marxism today is just shorthand for Beijing to assert party leadership, and there is no need to pay it any attention as Hong Kong is governed by “one country, two systems”.

The nation is, of course, ruled by the Communist Party, albeit one practising socialism. In mainland China, Marxism remains a subject of political interest. Marx’s 200th birthday on May 5 was celebrated with some fanfare. The party’s general secretary, Xi Jinping, urged cadres to study the Communist Manifesto, published in 1848 by Marx and Friedrich Engels.

The manifesto was one of the most influential pieces of writing of the 19th century. Marx’s observations about capitalism’s strengths and weaknesses are still worth reading and his arguments on how to tackle social injustice and poverty should not be overlooked. But can Marxist principles help “to solve the problems facing contemporary China”, as Xi asserts?

Stressing party leadership above all else may not be the only aim behind Xi’s call to study Marx. His critique of capitalism could well have a place in Beijing’s desire to create a new narrative to challenge capitalist, free-market liberal democracies.

Xi’s take on Marxism offers alternative to decline of the West

Critics of the capitalist system have long pointed out its ills, among them the exploitation of workers, the creation of huge wealth and income inequalities, and market instability. The financial crisis of 2008, caused primarily by a failure in regulation and a breakdown in corporate governance in Western economies, illustrated the dangers of capitalism running amok.

The ideological battle of the 21st century is between what the US represents and what China wishes to redefine

After that painful experience, the West could no longer convincingly claim its system is superior and developing economies should learn from it.

Beijing puts much less faith in untrammelled free markets. Markets need to be managed, and the government has an important role to adjust its policies accordingly. Critics of China’s economic policy focus on what they see as the heavy hand of the state, such as denying foreign companies full access to its domestic markets, keeping a large state-owned sector, and providing subsidies to local companies.

Currently, the United States sees China as a threat to its economic well-being. It wants to force a change to Chinese policy through, among various measures, imposing stiff trade tariffs. Supporters of this view are also concerned about the new “Made in China 2025” policy to invest in industries of the future – such as high-speed rail, new materials, new power sources, advanced agriculture and autonomous vehicles – so that China can be a dominant industrial powerhouse.

Watch: What’s the beef with the ‘Made in China 2025’ strategy?

In other words, it is a clash of two different economic and governing systems – a belief in free-market capitalism versus a belief in the role of the state to adjust its policies in order to maintain rapid growth.

There are two further characteristics of liberal democracies that are worth noting: short election cycles and suitability of candidates.

A recent McKinsey Global Institute report shows that the average tenure of political leaders among the rich G20 countries is 3.7 years today. The concern is that politicians tend to focus on short-term election promises, rather than the longer-term interests of their countries. Thus, the Trump administration’s tax cuts look set to generate large, future fiscal deficits, which will have a negative impact on public services.

How inequality is rooted in our quest for simple truths

Another concern is the lack of trust in politicians and political parties. Elections enable voters to show their displeasure with the political establishment by choosing an untested new leader, although disappointment may set in once the new person is found to be doing an equally poor job.

China argues for a political meritocracy based on performance instead of universal suffrage. Its reform efforts are focused on internal party operations and modernising the country’s vast bureaucracy. It emphasises improving the education, capacities and capabilities of cadres and officials. It is unlikely that some of the successful vote winners in the West who have had little or no previous political experience could be catapulted to high office in China, where party chiefs, mayors, governors and ministers are tested for years before being promoted.

Hong Kong had lived through the 20th century face-off between the successful capitalist West and the dour communist East. The ideological battle of the 21st century is between what the US represents and what China wishes to redefine. China wants to offer its interpretation of where the capitalist free-market model went wrong and how its own experience since the 1980s could provide new thinking on poverty alleviation and development. The Western narrative that has dominated the world order over the past century is being challenged.

Moreover, China has also become an active participant in diplomacy that requires multinational cooperation, on issues such as climate change and the global effort to limit Iran’s nuclear programme. America’s exit from both multilateral agreements under the Trump administration offers China opportunities to play a globally responsible role.

China should care about its image in the West

China’s narrative has an international audience today. If Marxism is a shorthand for the problems of capitalism, there is no need to denounce it before examining what may be the legitimate role of government in reducing poverty and inequalities; as well as to push development.

As Hong Kong begins seriously rethinking how it can progress as a society under “one country” and which policies will help it profit most within the broader national narrative as part of a special “two systems”, there might just be some benefit to reading and understanding Marx, who tried to understand the roots of social injustice.

Christine Loh is chief development strategist and adjunct professor at the Hong Kong University of Science and Technology’s Division of Environment and Sustainability. This is part of a series looking at what role Hong Kong can play in a revitalised China

The other articles in the series:

How the Greater Bay Area can boost Hong Kong’s environmental collaboration

Hong Kong can best serve China as a mediator between East and West

How Hong Kong can help create the ‘Chinese dream’