What is China's 'new era'? [Part 2]

As mentioned in part 1 of this article, for China, the coordinates for the new era can be marked using two axes: socialism and global history, both of which feature universal topics in history. The global history axis of the new era is mainly characterised by some features of the knowledge economy and the renewed social contracts that arise from that. The fourth industrial revolution has made manual labour obsolete and is in the process of surpassing and displacing intellectual work, including creative labour. Its impacts on society and humanity are unforeseen by any "-ism". Humility and openness are the most basic requirements in navigating the new economy.

The knowledge economy is characterised by innovation, in which only creative labour drives history. Resource scarcity arises only from the scarcity of knowledge. However, knowledge is intangible and its market value is increasingly subjective, resulting in an increasingly elusive basis for intangible asset valuation. The arbitrariness of this valuation and capitalism's customary downward pressure on wages constitutes the high-tech causes of the polarisation between the rich and the poor. On the one hand, technological progress has converged wealth among the few elites; on the other hand, jobless growth, wage stagnation and welfare cuts have become increasingly common. Social unrest will occur when economic growth ceases to be meaningful to the ordinary people.

Compared to the era of mass production, the creation and application of knowledge are very different in the knowledge economy. Lifelong learning integrated with continuous innovation is increasingly becoming the mainstream mode of production. It will require substantial institutional innovation and greater investment in industry-university-research cooperation to make the transition from the traditional economy. The purpose is not to increase productivity but to establish new modes of production. Realising post-capitalist modes of production will require the transformation of socio-economic incentives from the profit-driven mechanisms of capitalism to a system of diversified motivations.

Sudden deglobalisation and major countries turning inward reflect the latter's domestic political pressures for new social contracts. The globalisation of capital has undermined the original consensus within countries and hurt the interests of the working and middle classes. Through globalisation and new technological means, capital has deserted the tripartite contract between the people, government and capital established after World War II, resulting in countries that are unable to sustain themselves. China's dual circulation strategy is a response to this global development and is, at the same time, a socialist inevitability.

The elements of socialism in the knowledge economy far outnumber those of traditional capitalism. Socialism with Chinese characteristics should fully grasp the new opportunities in the knowledge economy to liberate the forces of production shackled by capitalist relations of production, and emancipate the people from being a factor of production under capitalism. Such spontaneous tendencies toward socialism have spawned many experiments within capitalist countries, including the previously-mentioned DIY culture, maker movements, online mutual aid economy or collaborative commons, as well as the many pilot programmes being test-run on Universal Basic Income (UBI) and the diverse experiments in new local community currency.

The new consensus that countries are all currently forging includes elements such as the natural environment, population and ageing that have been either neglected or trampled upon by the old capitalist contract. Further, there is a push towards exploring new forms of democracy to overcome the problems of popular elections, which is consistent with the Communist Party of China (CPC)'s notion of "whole-process people's democracy".

However, the CPC must not simply repeat slogans that merely re-label the existing institutions, such as the centralised party leadership, the National People's Congress, the Chinese People's Political Consultative Conference, autonomous regions, multi-party cooperation, and grassroots self-governance. Re-labelling will not solve problems because substantive systemic reforms are required to adapt to the new reality and future shocks.

The issues represented by the socialism and global history axes are universal to humanity. Only under their coordinates can the mission and tasks articulated by the 20th National Congress of the CPC find direction to blaze a trail for China towards a bright future and play a leading role for the world.

Both axes feature many intersecting points. First, to eradicate hi-tech causes of income polarisation, it is necessary to redefine employment and value beyond that dictated by the capitalist labour market. Achieving diversity in value validation is inherently socialist in orientation.

Second, creativity and innovation are very unevenly distributed in the population. As the value created by a few will eventually meet the needs of the majority, humanity is very likely to adopt the Marxist distribution principle "from each according to his ability, to each according to his needs" earlier than expected, replacing the capitalist principle of distribution as the latter will increasingly exclude more people from sharing the spoils and render them the "useless class".

Third, the knowledge economy has extensive spillover effects whereas the capitalist system of property rights tends to limit the positive spillover effects to maximise profits but indulge in the negative ones to reduce production costs. Overcoming this systemic bottleneck can enable the knowledge economy to benefit more people, thus reducing the rich-poor gap. Fourth, transforming the incentive structure in society is in line with the CPC's advocacy of the "core values of socialism". It is also closely related to the mobilisation of the non-material motivations inherent in human nature, to the "well-rounded development of human being", as well as to the future development of humanity and society.

Currently, as China's market economy has integrated with the global economy, the CPC's raison d'être for socialism is, to a certain extent, constrained by capitalism. Despite its "original aspirations", the CPC has not found a way to fully embrace socialism. It needs to break away from the old ideological orthodoxy and expand its socialist horizon. If the party falls short in its understanding of the knowledge economy's extensive and far-reaching implications, it will be unable to recognise the new opportunities for socialism and continue to be entrapped by the old debate between socialism and capitalism.

The trends of an era know no mercy. Those who go with it will thrive and those who go against it will perish. A muddled definition and vague descriptions of the new era imply a failure to feel its pulse and fully understand its significance. All the governments in the world like grandiose rhetoric, and there is a particularly strong liberal arts style in China's governance today, fond of playing with words, piling up a great deal of extravagant, unusual, overlapping and specious nouns and adjectives.

The resultant lack of clarity has manifestations in reality. For example, the tendency of adhering to the return to orthodoxy over engendering creativity serves to restrain rather than empower, although the era of innovation requires imagination and out-of-the-box thinking of the highest order. The structure of the knowledge economy is open and flat, requiring everyone's broadest agency to take action. The reality in China is a reversion to large-scale centralisation of power and rule by the voice of one, possibly tumbling towards totalitarianism. This is regression instead of progression, and runs counter to today's ever-changing times.

The three-year fight against Covid-19 has proven that the "personal guidance and deployment" model is unable to keep up with the times because the locus of decision-making is too far removed from the ground. The one-size-fits-all approach regardless of changes on the ground reflects the Mao-style determination and fighting spirit but fails to address the actual needs. The sudden and disorderly lifting of the lockdown in China has abruptly turned the call to "put the people and their lives above all else" into "resign to one's fate". This has also exposed poor preparations to ease the lockdown restrictions during the three-year lockdown.

The weak governing capability stems from the weaknesses in the governing system that is too centralised to adapt to the dynamic, changing circumstances. While thus far China is still the best among large nations solely in terms of pandemic control, the model it employed has two drawbacks: it has no future and it is unpopular. A large country must never be governed single-mindedly.

The reversion to orthodoxy in China comes from the "ideological superstructure" instead of the "economic infrastructure"- in Marxist terminology. Attributing the considerable achievements of China's reforms and opening up to "Marxism works" is far-fetched and ridiculous because the return to ideology has not solved some of the most basic problems, including the role of capitalists in the socialist market economy, whether class struggle is still the "locomotive of history", whether private ownership should be abolished, how socialism should be defined, what is the difference between socialist market economy and capitalist market economy (pointing to "communist party leadership" is theoretically unsound), whether proletarian dictatorship is still needed, and whether the labour theory of value is correct. These unresolved issues have sowed the seeds of social conflicts and political instability.

Analogous to this is private school education in ancient China, in which the teacher compelled the young pupils to memorise and recite the Four Books and Five Classics (四书五经) regardless of their understanding. The education philosophy then was to imprint these original teachings in the young pupils' minds at the age when they had excellent memory, and the classics and pearls of wisdom would reappear intact in their minds to guide their thoughts and behaviours when they grew up and gained life experience.

The generation that grew up during the Cultural Revolution undoubtedly memorised a great deal of Mao's quotes and lines or sections of the Marxism-Leninism classics. In their subsequent decades in industrious officialdom, these individuals did not have time update their knowledge and narratives. Thus when the situation calls for it, the old classics and original ideology will naturally and effortlessly be retrieved from memory for use as narratives, and one can easily time-travel to bring back the past.

This may be speculative but certainly not baseless; otherwise, the sudden prevalence of the slogans, expressions and tone as well as the mindset and ethos of the Cultural Revolution era cannot be explained. It would also be baffling that the official ideology is held aloft when some of the most basic and urgent theoretical problems remain unaddressed.

We are currently on the cusp of creating the Third Axial Age of human civilisation. In these troubled times, amidst turmoil in many countries, China is in a favourable position to partake in the creation of a new post-capitalist human civilisation and is more likely than most countries to take advantage of the opportunities brought about by the new era.

The rise of a civilisational state is unlike the rise and fall of great powers within the same civilisation. The smooth rise of this new civilisational power will require high-level of civilisational achievements in order to gain global acceptance and alacrity to follow and emulate. This is an impossible level of achievement by a "nostalgic revisit of the past", which has led to the drastic deterioration of relations between China and Western countries, hampering the Chinese rejuvenation.

There is nothing wrong with the idea to "achieve unity in thinking, will, programme and action" in order to achieve national rejuvenation. However, if the unity goes against the grain of the times, is confined to a thinking that restrains, and represents the will of a handful of people instead of the consensus from extensive consultation among the people, then the outcome of "unity in programme" and "unity in action" may well be a unity in ruin. To live up to this era, China must overcome the various subjective limitations to enable extraordinary innovation, so as to open up new frontiers of human civilisation.

This article was first published in Lianhe Zaobao as "何为新时代？（下）".

Related: What is China's 'new era'? [Part 1] | China's big hurdles returning to the forefront of civilisation | Xi's CCP practises Leninism of the 21st century. But could it end up as empty talk? | Xi Jinping's misguided return to ideology | Why China's 'peaceful rise' will be particularly difficult