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From Labor Action, Vol. 12 No. 37, 13 September 1948, p. 3.
Transcribed & marked up by Einde O’Callaghan for ETOL.
Production and normal commerce are impossible under these conditions and tend to cease. Highest profits are in speculation. And at every stage of every transaction the ubiquitous KMT officialdom gets its huge rake-off in gangster fashion. Compounding the monetary problem is the constant administrative Intervention of the state. Taxes are raised, materials and bank withdrawals are controlled and limited.
The result has been the alienation of large sections of the Chinese and even the American bourgeoisie from Chiang Kai-shek. Many of them now talk of the hopelessness of Kuomintang China and are beginning to look to the CP as a possible alternative.
The CP has directed a heavy propaganda barrage to these capitalists, offering all kinds of guarantees of lower taxes, freedom of trade and production and no expropriation. To the Chinese bourgeoisie the CP offers an all-out fight against competing U.S. and Japanese goods, and to foreign capital it offers welcome and protection.
The Stalinists give as evidence of good faith the policies in their areas. Mao Tze-tung denounces “encroaching on industry and commerce – and hitting, at industry and commerce in the field of tax policy” as “leftist tendencies” which must be corrected.
Under these circumstances the U.S. has not found an instrument to effectuate its China policy. The U.S. has poured into China from four to five billions since the end of the war. It has supplied the Kuomintang with several hundred ships and planes and has armed its divisions.
At the war’s end the U.S. navy ferried nine entire Kuomintang armies into Manchuria by ship and plane. Its intervention has been constant. General Marshall directed this intervention for over a year as special envoy. Ambassador Stuart has his fingers deep in Kuomintang politics. The U.S. obtained a treaty from China which gives it free transport and practical control of inland navigation. The American ECA determines the distribution of 370 millions in aid and thereby determines the orientation of a large section of the economy.
But U.S. policy is a failure because it cannot find a substantial political faction which is dependable enough and capable enough to resist the disintegrating forces.
The feudo-bureaucratic cliques of the Kuomintang cannot serve this function. Their venality, their incompetency and their landlord connections make of them a corrupt class. They are incapable of serious concessions even to the bourgeoisie, on which the U.S. would like to base itself. The Chinese bourgeoisie has shown itself incapable of organizing a resistance inside the Kuomintang. The failure of American policy is linked to the inner rot of the Chinese bourgeoisie.
A new vigorous political group is essential to U.S. policy. But such a group could only be erected outside of the Kuomintang arena and in opposition to it. It would have to undertake such sweeping reforms as would be tantamount to revolt against these entrenched powers. In such a situation the way would be opened to quick Stalinist victory. The dilemma of American policy is that it must support Chiang, out of fear of the alternative to his defeat, and yet this support is squandered and dissipated into unproductive channels, which in turn undermines Chiang’s regime.
There are indications that at Yalta the Big Three divided Asia as follows: Russia to get Manchuria, Southern Sakhalin, the Kuriles and Darien; U.S. to get the rest of China, Japan and the Northern Pacific; Britain and her satellite empires to keep Southeast Asia and India. In the inter-imperial antagonisms which have become dominant since then, the U.S. has been unable to take and consolidate its share.
The Russians have given far, far less support to the Chinese Stalinists than the U.S. has to the Kuomintang. Harold Isaacs writes:
“... the Russians have meanwhile played a passive game, and they have been amply rewarded for doing so. Every American policy, every America act has so far served the Russian rather than the American interest in Asia. Thus. Russia has held itself largely aloof from the developing civil war in China, although not so aloof that its influence is wholly unfelt.”
America is hated in China today as never before because of its failures and interventions and continued support to a despotic regime. America has failed to bring either unity or peace to China, although it desired both in order best to effectuate its economic domination.
The failure in China is a major historic blow at American capitalism. It may well prove fatal. The century-long lure of the Chinese market, the fabulous possibilities and potentials of that continent are almost lost. The possibility comes daily closer to realization that in place of this great hope of American imperialism is rising a bastion of Stalinism which would create a base from which the U.S. could be driven from the Western Pacific and Asia, economically and militarily.
Stalinism’s southward march has reached a decisive stage. The Northern provinces have been consolidated. Manchuria is the arsenal for the CP armies. A stable regime based on moderate land reform and on the support of the middle and rich peasants and landlords has been established. Recent events indicate that the Stalinists intend to expand to an all-national power.
Recently a conference we is called in Harbin of trade unionists for the purpose of launching a national labor organization. The working class of the big coastal cities like Shanghai, Tientsin and Canton, and in the interior in Nanking and Hankow, is lot under Stalinist influence. Memory of the betrayals of 1927–28, though dimming, is still present.
However, in the absence of an independent alternative of substantial power, the CP exerts an enormous attraction as against the terroristic gangsterism of the Kuomintang. The Stalinists know that China can never be conquered, nor can any conquest be made secure without the urban working masses. That is the explanation of the Harbin Conference. This conference laid the basis for the first national labor federation. The Stalinists have never attempted this before. Such a federation would have as its object the organization of the working class under Stalinist leadership. It is part of the plan of Stalinist expansion. The working class has not yet yielded to Stalinist blandishments. Therein lies a hope.
The second event is the Stalinist wooing of dissident and dissatisfied bourgeois elements. The May Day Call of the CP stated:
“All democratic parties and groups, people’s organizations and social luminaries speedily convene a political conference, discuss and carry out the convoking of a people’s representative assembly to establish a democratic coalition government.”
There has been considerable response to this call. The Kuomintang Revolutionary Committee (a dissident group), the Chinese Democratic League, the Farmers and Workers Democratic Party and others have replied favorably. Scores of Kuomintang exiles living in Hong Kong have taken up the call. The outstanding figure among these exiles is Marshall Li Chai-sum, Chiang’s former chief of staff. General Feng, the “Christian general,” supports the call. Hong Kong seethes with intrigue and negotiations.
The basis is being laid for a “coalition” of these groups with the CP. Not one of these groups has a mass following. However, that is not what the CP needs at this time. Such a “coalition” would enhance the threat to Chiang’s regime and would give a semi-legal cover to the Stalinist conquests which could be organized as a “national government.”
The great student demonstrations which have swept the cities for months have a spontaneous character and are an immense force of protest. They are not coordinated nor politically channeled. They are movements of protest against Kuomintang tyranny and American intervention. This is the most important active popular upsurge since the end of the war. The government has been unable to suppress it fully. It gathers support from the intellectuals and professors. Its weaknesses are political and social. The latter, above all, because it is not linked to the working masses. In the specific context of the current political arena these students, especially those in the Southern cities, that is, those who have not suffered direct contact with it, are drawn to Stalinism.
The Chinese civil war is the curtain-raiser on World War III. However, it is more analogous to 1936 Spain than to 1948 Greece, in the sense that the imperialist powers operate indirectly through national forces. It is a civil war between Stalinist totalitarianism and feudo-bourgeois despotism. In this civil war the Chinese working class remains as yet uncommitted.
Hope lies with the uncommitted working masses of the cities, that these voiceless millions will find in themselves the power to wrest the defense of the nation against Stalinism from the bloodied hands of the Kuomintang. The first problem and duty of revolutionists is that of survival under conditions of political terror in both sections of China. This problem alone will require all the ingenuity and political wisdom and heroism that can be mustered.
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