This is the second part of a reply to Heiko Khoo, by Peter Glover

Is China capitalist? Marxist World says it is. Heiko Khoo disagrees.

Heiko says: “The contention that China is capitalist is supported by a wide variety of facts and it is the dominant popular and academic consensus. A major problem with this is definitional. Divergent concepts of capitalism and socialism will produce a different systemic match. The categories employed determine the outcome.”

We would agree that different definitions may produce different outcomes. But we don’t agree that the starting point for the solution of this problem should begin with the works of Preobrazhensky. The terms that define this debate must begin with the ideas formulated in Marx’s works, in particular Capital.

Preobrazhensky claimed to be a Marxist and maintained that he was using “the method of Marx”. In the New Economics he says: “There cannot, of course, be the slightest doubt that in studying our economy we can, must, and will base ourselves on the general principles of Marxist method, in so far as this means the method of dialectical materialism in general, and in particular the general sociological method of Marx. However, in so far as it means the method used by Marx in his political economy, that is, the method of studying the production-relations of pure capitalism, we are obliged to face a methodological problem, since the very material to be examined is substantially different.”

Preobrazhensky therefore describes Marx’s method as having the following features: the general principles of the Marxist method; the general sociological method of Marx; dialectical materialism. This is tautological. He confuses the method that Marx used with his object of study. The object of study is the production relations of capitalism. The method of study according to Preobrazhensky is “the method used by Marx in his political economy, that is, the method of studying the production-relations of pure capitalism.” Preobrazhensky tells us that Marx’s method of studying capitalism was to study capitalism.

Preobrazhensky follows in a long line of people in the Marxist tradition who substitute a Marxist method of their own creation for the ideas of Marx. He compounds his error by asserting that Marx was studying the production relations of “pure capitalism” which were superseded or modified by later developments. “A comparatively ideal period for free competition on the scale of the world capitalist economy, and so a period as favourable as possible for the working of the law of value, was the epoch of classical capitalism before its transition to the Imperialist phase.”

Although historical research is important in Capital, it is fundamentally a theoretical analysis of capitalism. Marx made a series of assumptions in order to uncover capitalism’s inner connections. For example, in Capital Volume One he assumed that prices and values were the same. He knew that they were almost never identical but all science involves such assumptions. There was no predetermined template which Marx rolled out over a broad canvas. The process by which Marx arrived at his conclusions was almost precisely the opposite. He was abstracting. He was setting aside the many features of the phenomenon he was investigating to concentrate on just one aspect. If there is a “method” in Marx then it is this method of abstraction. Abstraction, in the sense that Marx used it, has been defined as “isolating particular phenomenon or relationships in the wider whole and drawing them out to be studied before reintegrating them.” (source:

Marx isolated the specific thing- the commodity- from the whole. Later on in Capital he reintegrates this and other concepts. Of course there isn’t just one scientific method. It is possible to reach conclusions using a variety of scientific methods. Also different types of questions require different types of investigations. But the claim is made by Preobrazhensky, and by inference Heiko Khoo, that they are following the same method of Marx. By contrast, Marxist World emphasises the concepts Marx developed in Capital. We also try our best to use the same approach of Marx. Many Marxists cloak themselves in generalities in their attempt to convince us that they are using his method.

The Commodity

Marx, in analysing contemporary society in Capital, began not with general concepts, but with a concrete thing – the commodity, a real article. In a previous article of mine, I began our analysis of Chinese society using a crucial concept defined by Marx in Capital Volume 1, page 1, paragraph 1, page 1: “The wealth of those societies in which the capitalist mode of production prevails, presents itself as “an immense accumulation of commodities, its unit being a single commodity. Our investigation must therefore begin with the analysis of a commodity.” [our emphasis]

Firstly, Marx assumed that a capitalist society was characterised by an immense accumulation of commodities. Commodity production has been a feature of many societies but only predominates when it attains a truly significant level of development. Marx is very clear on this point. Widespread commodity production on a huge scale is a feature of this type of society. Marx’s investigation of capitalist society didn’t begin with an investigation of a commodity by accident. Marx said that this must be the case. He isolated the commodity as a singular object of study.

The Grundrisse was the preparatory work for Capital. It isn’t until its final pages that Marx discusses the nature of the commodity.  At that point, however, after years of patient study, Marx realised that this section on commodities had to be brought forward. Marx’s realisation of the importance of the commodity, an almost Eureka moment in the Grundrisse, had profound results. The concept that eventually Marx takes 800 pages to come to grips with, the commodity, is brought forward to the first page of Capital.

When defining the nature of Chinese society, Heiko starts in a different place. He says: “I suggest that a viable theory to explain China’s contradictory dynamics should be based on a variant of Preobrazhensky’s concept of ‘primitive socialist accumulation’. And the fundamental characteristics of China’s system are rooted in the historical genesis of its bureaucratic state planning system.”

Heiko doesn’t begin his investigation of the problem by examining concepts such as commodity, value, constant capital, surplus value and labour-power but the much more general concepts of “primitive socialist accumulation” and the “bureaucratic state planning system”.

A further clue to Marx’s approach can be found if you look at the chapter headings in Capital. He begins with the commodity before moving to exchange and then to money, to capital, to labour-power, to constant capital, surplus value, the working day etc. It isn’t until near the end that Marx discusses The General Law of Capitalist Accumulation, followed by “primitive accumulation”.

Heiko has inverted Marx’s approach and therefore moved the terms of the debate to those of his own choice. He begins his investigation of Chinese society, not from its building blocks, but in its generality. As we have pointed out, this is in opposition to the way Marx investigated a phenomenon. That also explains our starting point. And that is why we have tried to use the concepts employed by Marx himself in the first instance before addressing Preobrazhensky’s ideas. How can we talk about a transitional economy before we have defined a capitalist economy?

Why should the word or concept “commodity” be the cause for such disagreement between us? What is Marx’s definition? Commodities are according to Marx’s definition both useful things and “material depositories of exchange value”. Capitalism is characterised by the production of useful things for others (which are the products of labour) that are also values. Products become values because human labour in the abstract is embodied in them. Exchange values are the expression of these values. For the sake of simplicity, in this instance we will call exchange values “prices” (price is actually the monetary form of exchange value). So commodities, apart from being useful, also have prices and are sold usually in the market place.

China is the world’s biggest producer of commodities. Marx’s first sentence could have been written with China in mind: “The wealth of those societies in which the capitalist mode of production prevails, presents itself as an immense accumulation of commodities”. Marx is very clear. The capitalist mode of production definitively emerges when commodity production becomes the dominant form of production. China produces the greatest volume of commodities in the history of the world. If we ignore the centrality of commodity production, we may reach completely different conclusions. But the conclusions would not necessarily be based on Marx’s ideas.

When commodity production is the dominant form of production, then although useful things are produced the intention is not to produce useful things but to produce value, or abstract wealth. As the quote attributed to Henry Ford goes: “I’m not in business to make cars, I’m in business to make money.”

The purpose of capitalist production is described by Marx thus: M-C-M’ (Money- Commodities- More Money), We can follow in Marx’s footsteps, too, using simple deductive logic. If you accept Marx’s theory then:

Proposition 1.The wealth of capitalist society presents itself as an immense accumulation of commodities.

Proposition 2. Chinese society produces and presents itself as an immense accumulation of commodities.

Conclusion: Therefore Chinese society is capitalist.


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