Revolution Started 90 Years Ago in China
Henry C.K. Liu
Part I: The Beginning
This article appeared in AToL
on November 12. 2009
The People’s Republic of China
observed the 60th anniversary of its founding on October 1, 2009. Many
that date as the 60th anniversary of the Chinese socialist
In fact, the protracted history of the Chinese socialist
revolution started 90 years ago in 1919 on May 4, when 5000 students
from Beijing University
and twelve other schools
held a political demonstration in front of Tiananmen, the focal point
is today known as Tiananmen Square. The demonstration sparked what came to be
known in history as the May Fourth Movement of 1919-21, an
movement rising out of patriotic reactions to China’s
then war lord government’s dishonorable foreign relations that led to
treatment by Western powers at the Versailles Peace Conference. May
a political landmark that turned China
towards the path of modern socialism through Marxist-Leninism.
Nationalism had fueled the Xinhai Revolution led by the
Nationalist Party (Koumintang or KMT) under the leadership of
succeeded in overthrowing the three-century-old Qing dynasty
(1644-1912) in its
final decrepit years by 1911 to establish the Republic of China.
after the 1911 Xinhai Revolution was a fragmented nation ruled by
warlords preoccupied with internal power struggle. The weak central
at the time, known in history as the Beiyang Regime (1912-28), was
the Beiyang Army commanded by Yuan Shikai, a war lord who had been a
general in the former Qing army.
The Beiyang regime, preoccupied with consolidating its rule
over other unruly independent regional warlords that had sprung up in a
vacuum as Qing rule disintegrated, not only did little to counter
and continuing Western imperialism in the new Republican China, it in
numerous additional concessions on Chinese sovereignty to imperialistic
governments in exchange for foreign financial and military support
rival regional warlords.
Yuan soon developed a delusion of monarchical grandeur,
fanned by none other than his American political advisor, Dr Frank J.
a constitutional expert sent to China
by the Carnegie Endowment. Goodnow was later to become president of Johns
A political scientist of note, Goodnow published a book entitled: Principles of Constitutional Government,
in which he concluded that Americans had long doubted the fitness of a
democratic republic in China
where a tradition of autocracy would make a constitutional monarchy a
suitable institution than a democracy.
Mistaking the positive reception of Goodnow’s book in America
as a sign of US
support, Yuan made a failed attempt to proclaim himself Emperor of
China on December 12, 1915.
To secure foreign
acceptance of his monarchial farce, Yuan accepted Japan’s
infamous Twenty-one Demands and signed an agreement with Russia
to recognize its special interest in Outer Mongolia
its special interests in Tibet.
In protest, Sun formed a Southern Government in Guangdong.
The monarchial farce ended with the abolition of the three-month-old
on March 22, 1916
other leading warlords refused to recognize Yuan as the new Emperor.
Frustrated, Yuan died on June
at age 56, officially from uremia, while some said suicide. Two months
Goodnow’s book received a positive review in the New York Times on August 13, 1916. After
Vice President Li Yuanhong became president of the restored republic
Guocheng became vice president. Both were warlords in the Beiyang
As the Beiyang regime fell into chaos, an opening emerged
for the restoration of the Qing monarchy, putting Pu Yi, the last
the restored throne on July 1,
Twelve days later, Duan Qirui, a leading general under Yuan, entered Beijing
with his troops and ended the Qing restoration. Reestablishing the
once again, Duan assumed the premiership of the new government under
Prodded by the US,
the Duan government declared war on Germany
on August 14, 1917
the approval of President Li or the new parliament.
Under the pretext of financing China’s
war effort, Duan negotiated the secret Nishihara Loan of 145 million
yen equaling to half US dollar in exchange rate at the time). Thus
financially, Duan set out to destroy the Southern Government of Sun
Feng Guocheng, who had succeeded Li Yuanhong as president, preferred a
negotiation with Sun. With the leadership of the Beiynag clique
military campaign failed to topple the Southern Government.
At the end of World War I, Japan as a victorious ally of the
Triple Entente had taken Shantung in China, also a victorious ally,
defeated imperialist Germany which had a 99-year lease for a naval base
port of Qingdao since 1898, left over from unequal treaties with the
Qing dynasty that the 1911 bourgeois democratic revolution overthrew.
At the outset of WWI, China
at first stayed neutral, while Japan
joined the Allies and ousted Germany
from Qingdao and
occupied most of Shandong
province. After the war, Japan
sought to legalize her de facto occupation of Shandong.
On August 14, 1917, China
entered World War I as an ally of Britain,
within the Allied Triple Entente, with the understanding that all
of influence in Shandong
returned to China
after Allies victory.
However, the Versailles Treaty of April 1919 awarded German
rights in Shandong Province
peace conference rejected China’s
request for the abolition of all foreign extraterritorial rights in China,
for the annulment of the infamous Twenty-One Demands by Japan
and for the return to China
her sovereign rights in Shandong,
taken from Germany
during the war.
Secret treaties between Japan and Western imperialist powers
to recognize Japan’s Twenty-One Demands on China in exchange for
support of Russian, French and British claims on other former German
assured great power support for Japan.
The coup de grace
was a secret pact signed in September 1918 between Japan
and the warlord Beiyang Regime, in which the Duan government had
terms of Japan’s
Twenty-one Demands in exchange for a loan of 20 million yen from Japan
as part of the Nishihara Loan. China’s
representative at Versailles
Twenty-one Demands were invalid because the Chinese parliament had
ratified them. Further, the Chinese delegation invoked the
concept of rebus sic stantibus to
claim on Shandong. The
states that when the objects of a treaty, or conditions under which it
concluded, no longer exit, the treaty becomes null and void.
In rebuttal, Japan
divulged the 1918 secret treaty signed after China
entered the war in which the Duan government of the Beiyang Regime had
agreed” to Japanese terms. The Western allies were bound by secret
leaving US President Woodrow Wilson as the lone supporter of China.
The United States
at first promoted Wilson’s
idealistic Fourteen Points, but was forced to abandon most of its
ideals due to firm resistance from Britain
major imperialist powers at the time.
Many Chinese intellectuals felt betrayed by the Versailles
Peace Conference as they had naively believed Wilson’s ideals of
justice and were expecting the US to forge a new world order of
international justice after the war.
Two prominent Chinese intellectuals, Chen Duxiu and Li
Dazhao, participated in the May Fourth student demonstrations. They and
soon came to the realization that Lenin’s conceptual linkage between
and imperialism was vividly proved by unfolding events around the world
particularly in China.
They came to the conclusion that to rid China of Western imperialism, China
must oppose capitalism and adopt a socialist path of self regeneration.
1921, Chen and Li co-founded of the Communist Party of China (CPC) in Shanghai,
the center of Chinese capitalism.
Hobson on Imperialism
The structural link between capitalism and imperialism was
first observed by John Atkinson Hobson (1858-1940), English economist,
wrote in 1902 an insightful analysis of the economic basis of
Hobson provided a humanist critique of neoclassical economics,
exclusively materialistic definitions of value. With Albert Frederick
(1855-1895), the great British Mountaineer who was tragically killed in
an avalanche whilst reconnoitering the Rakhiot Face of Nanga Parbat, an
8,000-meter Himalayan peak, Hobson wrote The Physiology of Industry
(1889), which argued that an industrial economy requires government
intervention to maintain stability, and developed the theory of
that was given an overflowing tribute by John Maynard Keynes three
The need for governmental intervention to stabilize an
expanding national industrial economy became the rationale for
imperialism in advanced capitalist economies. On the other side of the
protectionism was a governmental counter-measure on the part of weak
partners for resisting imperialist expansion of the dominant powers.
Historically, the processes of globalization have always
been the result of active state policy and action, as opposed to the
passive surrender of state sovereignty to market forces. Market forces
operate in a political vacuum. Markets are governed by man-made rules.
Globalized markets require the acceptance by local political
authorities of the
established rules of the dominant economy. Currency monopoly and
hegemony is the
most fundamental trade restraint by one single dominant government.
global market is dominated by dollar hegemony.
Friedrich List on Economic Nationalism
Friedrich List, in his National System of Political
Economy (1841), asserts that political economy as espoused in 19th
far from being a valid science universally, was merely British national
opinion, suited only to English historical conditions. List’s
institutional school of economics asserts that the doctrine of free
devised to keep England
rich and powerful at the expense of its trading partners and it must be
with protective tariffs and other protective devises of economic
the weaker countries.
Henry Clay’s “American system” was a nationalist system of
political economy. Economic nationalism was a necessary policy for the US
in the 1850s. US
neo-imperialism in the post WWII period disingenuously promotes
free-trade against economic nationalism labeled as protectionism to
keep the US
rich and powerful at the expense of its trading partners.
Before the October Revolution of 1917, many national
liberation movements in European colonies and semi-colonies around the
were influenced by List’s economic nationalism. The 1911 Xinhai
by Sun Yat-sen was heavily influenced by Lincoln's political ideas
of the people, by the people and for the people, and the economic
of List until after the October Revolution in Russia when Sun realized
Soviet socialist, anti-imperialist model was the correct mode for
revival of China.
Imperialism and Iron Law of Wages
Hobson’s magnum opus, Imperialism (1902), argues that
imperialistic expansion is driven not by state hubris, known in US
history as Manifest Destiny, but by an innate quest for new markets and
investment opportunities overseas for excess capital formed by
home for the benefit of the home state. Over-saving during the
age came from Richardo’s theory of the iron law of wages according to
wages were kept perpetually at subsistence levels as a result of uneven
power between capital and labor. Today, job outsourcing that returns as
low-price imports contributes to the iron law of wages in the global
including the US
domestic economy. (Please see my February 2006 AToL series: Organization of
Exporting Countries (OLEC).
In the 1970s, dollar hegemony emerged as a geopolitically
constructed peculiarity through which critical commodities, the most
being oil, are denominated in fiat US dollars, not backed by gold or
species since US President Richard Nixon took the US dollar off gold in
The recycling of petro-dollars into other dollar assets is the price
has extracted from oil-producing countries for US tolerance of the
oil-exporting cartel since 1973. After that, everyone accepts dollars
dollars can buy oil, and every economy needs oil.
Dollar hegemony separates the trade value of every currency
from structural connection to the productivity of the issuing economy
it directly to the size of dollar reserves held by the issuing central
Dollar hegemony enables the US
to own circuitously but essentially the entire global economy by
wealth to be denominated in fiat dollars that the US
can print at will with little in the way of monetary penalties.
World trade is now a game in which the US
produces fiat dollars of uncertain exchange value and zero intrinsic
the rest of the world produces goods and services that fiat dollars can
“market prices” quoted in dollars. Such market prices are no longer
mark-ups over production costs set by socio-economic conditions in the
producing countries. They are kept artificially low to compensate for
effect of overcapacity in the global economy created by a combination
overinvestment and weak demand due to low wages in every economy.
Such low market prices in turn push further down already low wages to
cut cost in an unending race to the bottom. The higher the production
above market demand, the lower the unit market price of a product must
order to increase sales volume to keep revenue from falling. Lower
prices require lower production costs which in turn push wages lower.
wages in turn further reduce demand. To prevent loss of revenue from
prices, producers must produce at still higher volume, thus further
market prices and wages in a downward spiral.
Export economies are forced to compete for market share in
the global market by lowering both domestic wages and the exchange rate
their currencies. Lower exchange rates push up the market price of
which must be compensated for by even lower wages. The adverse effects
dollar hegemony on wages apply not only to the emerging export
also to the importing US
economy. Workers all over the world are oppressed victims of dollar
which turns the labor theory of value up-side-down. (Please see my
article on Dollar
Lenin’s Theory of Imperialism as an Advanced Stage of
Hobson’s 1902 analysis of the phenology (life cycles study)
of capitalism was drawn upon by Lenin fourteen years later to formulate
theory of imperialism as an advanced stage of capitalism: “Imperialism
capitalism at that stage of development at which the dominance of
and finance capitalism is established; in which the export of capital
acquired pronounced importance; in which the division of the world
international trusts has begun, in which the division of all
territories of the
globe among the biggest capitalist powers has been completed.”
Lenin, 1870-1924, Imperialism, the Highest Stage of Capitalism,
7 - 1916).
“It is characteristic of capitalism in general that the
ownership of capital is separated from the application of capital to
production, that money capital is separated from industrial or
capital, and that the rentier who lives entirely on income obtained
capital, is separated from the entrepreneur and from all who are
in the management of capital. Imperialism, or the domination of finance
capital, is that highest stage of capitalism in which this separation
vast proportions. The supremacy of finance capital over all other forms
means the predominance of the rentier and of the financial oligarchy;
that a small number of financially “powerful” states stand out among
rest. The extent to which this process is going on may be judged from
statistics on emissions, i.e., the issue of all kinds of securities.” (Lenin's Imperialism,
Chapter III: Finance Capital and the
Lenin was also influenced by Rosa Luxemberg, who three year
earlier had written her major work: The Accumulation of Capital: A
Contribution to an Economic Explanation of Imperialism (Die
des Kapitals: Ein Beitrag zur ökonomischen Erklärung des
Luxemberg, together with Karl Liebknecht, founding leaders of the
League (Spartakusbund), a radical Marxist revolutionary movement that
renamed itself the Communist Party of Germany (Kommunistische Partei
Deutschlands, or KPD), was murdered on January 15, 1919, four
the May Fourth Demonstraations in China, by members of the Freikorps,
rightwing militarists who were the forerunners of the Nazi
led by Ernst Röhm.
The congenital association between capitalism and
imperialism requires practically all truly anti-imperialist movements
over to be also anti-capitalist. To this day, most nationalist
emerging economies are unwitting neo-compradors for super imperialism.
Neo-liberalism, in its attempts to breakdown all national boundaries to
facilitate global trade denominated in fiat dollars, is the ideology of
(Please see my October 12,
2007 article on Super
Capitalism, Super Imperialism and Monetary Imperialism)
Chinese Exposure to Marxism
Chinese intellectuals first became aware of Marxism around
1905, fifty-seven years after the 1848 publication of the Communist
and thirty-eight years after the first publication of Das Kapital: Kritik der
politischen Ökonomie in 1867, when a small Chinese
Min-Bao (People’s Journal) published a biography of Marx, twenty-two
after Marx’s death in 1883. Three years later, in 1908, an anarchist
the name of Tien-yi Bao (Journal of Natural Justice) founded a year
published a Chinese translation from the Japanese translation of
Engles’ 1888 English edition of Introduction
to the Communist Manifesto, and the first chapter of the Manifesto
But only in 1916, three years before the May Fourth Demonstrations, did
make the insightful connection between imperialism and capitalism.
Although incipient recognition of Marx and Engles as the
founders of scientific socialism had been acknowledged, the influence
Marxism on Chinese intellectuals remained sporadic until the 1919 May
Movement when the success of the Bolshevik October Revolution
revolutionary possibility of a socialist ideology seizing the power of
state. At Versailles,
Western democracy lost all credibility in China
as a progressive force against imperialism.
Lenin’s views about imperialism being the highest stage of
capitalism enabled socialism to present itself as a promising
theory to the Chinese intelligentsia for combating both Chinese
Western imperialism. On a state level, the new communist government of
the Soviet Union twice, in 1918 and 1919,
unilaterally renounced all special
rights and privileges of Tsarist imperialism in China,
notwithstanding a fragmented China
nominally headed by a central government too weak to reverse the
of Western imperialism.
Lenin’s insight of the linkage of capitalism and imperialism
gave Chinese intellectuals an understanding of capitalism as the
root cause of foreign imperialistic domination of China.
More importantly, Lenin’s insight inadvertently gave Chinese
central place in the universal struggle towards a new world order. By
1918, Beijing University
had become a vibrant
center of socialist revolutionary thoughts.
Li Dazhao, head librarian at the Beijing
library at the time of
the 1919 May Fourth demonstrations, had learned from the October
1917 that anti-imperialism as a political movement required the
existence of a
communist party in China.
But while Li was a nationalist and socialist revolutionary who saw that
peasantry as the fountainhead of socialist revolution in China, he was
temporarily distracted by Kropotkin’s communist anarchism as promoted
by Li Shi-zeng, which denied the importance of the role of the state in
socialist revolution before the stage of the “withering away of the
The May Fourth Movement marked a turn by anti-imperialist
Chinese intellectuals towards revolutionary Marxism. The success of the
Revolution in Russia
was a major factor in forming the views of Li Dazhao on the
of the state. Li initiated the Peking Socialist Youth Corps in 1920 and
1921 co-founded the Communist Party of China (CPC) with Chen Duxiu, who
been exposed to socialist ideas in Japan,
as a political institution with the secular program to seize power of
to carry out socialist revolution in China. A revolutionary state is the rationale for a
one-party government, provided that the ruling party represents the
the people. Li was a mentor to Mao Zedong who openly acknowledged
influenced by Li’s ideas.
However, at the direction of the Third International
(Comintern) in Moscow, Li
and other Chinese Communist Party members joined the Nationalist Party
(Koumingtang or KMT) as individuals. Li was even elected to the KMT
Executive Committee in 1924. When the Chinese civil war started after
of KMT leader Sun Yatsen on March
12, 1925 and the subsequent assassination five months later,
20, of Liao Zhongkai, leftist KMT leader and heir to Sun, Li was
together with nineteen other communists during a right wing KMT raid on
Soviet embassy in Beijing.
executed on the orders of the warlord Zhang Zuolin on April 28, 1927.
The Debate on Socialist Internationalism
The first edition of Stalin’s Problems of Leninism, which
“appeared in April 1924, seven years after the October Revolution of
asks: “Is it possible to attain the final victory of socialism in one
without the combined efforts of the proletarians of several advanced
countries?” The answer was: “No, it is
not. The efforts
of one country are enough for the overthrow of the bourgeoisie. This is
the history of our revolution tells us. For the final victory of
the organization of socialist production, the efforts of one country,
especially a peasant country like ours, are not enough. For this we
the efforts of the proletariat of several advanced countries.”
The strategic key words on socialist
internationalism are ‘final victory’ which cannot be achieved with just
‘socialism in one country’, and the phrase “the proletariat of several
countries”. But ‘final’ implies not immediate but in the future, even
distant future. And international
communism was focused not on the whole world, but on “the proletariat
several advance countries” where evolutionary conditions were
ripe. It was not focused on the peasantry still living under
feudal societies outside of Europe or the
people of imperialist colonies and semi-colonies.
To both Lenin and Stalin, the path
to liberation in the colonies of the Western empire was to strengthen
socialist country in the world and to weaken capitalism at the core to
final stage of imperialism. In theory, the liberated workers of the
in turn liberate the oppressed peasants in the colonies and
Unfortunately, events failed to
support theory. There was no worker uprising in the advanced economies.
fact, unionism in the advanced economies turned anti-communist.
cannot be delivered by others. Each oppressed group must struggle for
liberation through internal political consciousness.
Both Lenin and Stalin failed to
recognize the inherently powerful but latent revolutionary potential of
peasants of the pre-industrial colonies and semi-colonies of the
Empires, which had to wait until the emergence of Mao Zedong in China
to force the world to acknowledge this truth in history.
Mao, in placing his faith in the
revolutionary potential of the Chinese peasantry, redefined the term
“proletariat” to mean those deprived of property, a property-less
from the European idea of the proletariat as the class of urban
The October Revolution of 1917 was launched on the slogan: “All
Power to the Soviets” through which the minority Bolsheviks won
in the Soviets, which were workers councils that constituted the power
the new socialist state. Bourgeois liberal democracy was not an
the October Revolution, but rather a target for elimination in order to
establish the dictatorship of the proletariat in the context of
revolution through class struggle.
This was because in feudal Russia
in 1917, the proletariat as a dominant class was an abstraction yet to
created as a reality by industrialization. The proletariat in its
small in number, could not possibly command a majority under universal
in a feudal agricultural society. Therefore dictatorship of a minority
is the only revolutionary path towards socialism.
In pre-industrial societies, liberal representative democracy
is by definition reactionary in the absence of a dominant working
considered the revolution in Russia
as a fortuitous beginning of an emerging socialist world order that
and justified a dictatorship of the proletariat to sustain
Leninists work for the acceleration of socio-economic
dialectics by the violent overthrow of capitalism which itself had been
violent slayer of feudalism. Evolutionary Marxists, such as social
believe in scientific dialectic materialism which predicts the
the replacement of capitalism by socialism as a natural outcome of
But the evolutionary process requires the emergence of
capitalism as a natural outcome of feudalism’s internal contradiction.
the process of evolution toward socialism as taking place in the most
segment of the world, in capitalistic societies of industrialized Western
Europe when the ruling bourgeoisie had replaced the
a result of the French Revolution. The Russian Revolution showed that
conditions have opened up opportunities for revolutions in
nations and it is in these pre-industrial societies that radical
needed to bring about socialism by short-circuiting the long
process from feudalism to capitalism to socialism.
the most industrialized country in the second half of the 19th
century, Social Democrat icons such as Karl Kautsky and Eduard
titans of Marxist exegesis, favored gradual, non-violent and
processes to effectuate inevitable dialectic evolution towards
because of the existence in Germany
of a large working class. These Marxists subscribed to the doctrine of
evolutionary Marxism which renders revolution unnecessary as socialism
arrive naturally from capitalism as an evolutionary process of
On the other end of the spectrum were radical revolutionaries
such as Rosa Luxemburg and Karl Liebknecht, leaders of the Spartacists,
in the summer of 1915 when they withdrew from the German
(SDP) because of SDP support for Germany’s
participation in the First World War.
The Spartacists staged an abortive coup to overthrow the young social
democratic government in Germany.
For communists, revolution is necessary in order to short circuit the
stage of capitalism during which the evolutionary process can be halted
unionism and the introduction of a mixed economy. This is particularly
pre-industrial feudal societies.
The call by radical Leninists for worldwide coalition of the
browbeaten proletariat majority in the industrial societies in the
were still deprived of political power beyond the dialectical process,
agitating proletariat minority in the agricultural societies in whose
radical Leninists had gained state power in Russia, was most
threatening to the
rulers of the capitalist order in the advanced imperialist countries. Reaction to this threat gave rise to
insidious anti-communism in the imperialist West to prevent the arrival
socialism in the strongholds of industrial capitalism ahead of its
schedule. In the advanced economies, state-sponsored capitalist
conditioning workers into an active anti-communist force through
unionism and the addictive appeal of individualistic bourgeois freedom
neutralize collective working class solidarity.
Still, all Marxists share the belief that the structural
antagonism between a capitalist bourgeoisie class and a proletariat
advanced economies was a necessary precondition for creating socialism.
required the resolution of the contradiction between the efficient
of capitalism and the economic dysfunctionality of the mal-distribution
wealth inherent in capitalism. The good of capitalism is its
creating wealth; the bad is that the way wealth is created in
wealth to go to the wrong places, to those who need it least, namely
rather than the poor who need it most. Also, awareness was increasing
capital in the modern financial system comes from the pension funds of
Wealth is Good
Wealth is good; it is the mal-distribution of it that is
bad. The internal contradiction of capitalism is that it creates wealth
widening the gap between rich and poor. Wealth disparity is a polluting
socio-economic by-product of capitalism. While capital cannot create
without labor, the proletariat in advanced economies, oppressed by a
pro-capital legal-political regime, never managed to gain control of
of the means of production financed by their own wealth. Thus workers
silently, docile victims of capitalist exploitation by capitalists
workers’ own money. Apologists for capitalism then create the myth of
being needed to create employment, ignoring the fact that it is the
income from employed workers that creates capital.
The global financial crisis that began in 2007 is a living
demonstration of the self-destruction potential of finance capitalism
supported by full employment and high wages, which then force needed
consumption to be financed by debt. The current financial crisis of
unsustainable debt has ignited populist socio-political changes in all
countries. These populist changes will transform the existing
world order, even though it is too early to predict what the new world
be like. Suffice to observe that changes in government toward
populism are now taking place in every nation.
October 30, 2009
Next: Lessons of