China’s State Enterprises – a success story with many lessons

Virodhi’s post on China is revealing and a direct challenge to the orthodoxies of growth, development and liberal agendas..

China is the center of the debate. With the brilliant show of Olympics at Beijing, the debate regarding the character of the Chinese state and society has also resurfaced. What is China? Socialist? People’s Democracy moving towards capitalism or socialism? Degenerated workers’ state? Capitalist? Imperialist? I argue that China was never a socialist state. Since its birth in 1949 in a very backward terrain, China continues to be a People’s Democracy moving towards socialism. With the advent of the period of Deng Xioping, revisionism took hold of Chinese ecnomics and society and the movement towards socialism was reversed. However, lately new information has been emerging from China which provides an interesting perspective, i.e., the reversal of the process of reversal. I am posting here an interesting article (I am not in agreement with the analysis, but the facts are interesting) that appeared in The Australian regarding the role played by the State Owned Enterprises in China:

China’s state enterprises aren’t dinosaurs

THE Olympic Games comprise China’s most prominent state-owned enterprise.

In some other countries, including Australia, the Olympics, and sport in general, are chiefly the realm of volunteers, of corporations, of a discrete professional world.

Agricultural corporations boast huge profits in midst of food crisis

By Naomi Spencer

As inflation and shortages expose billions to hunger worldwide, agricultural giant Archer-Daniels-Midland Company revealed a 42 percent leap in quarterly profits. The announcement follows similarly skyrocketing earnings reports from half a dozen other agribusinesses and suppliers, as well as from major oil companies BP, Shell, and Exxon.

For the third fiscal quarter ending March 31, ADM reported $517 million in profit. In an April 29 conference call, executives attributed record earnings throughout all of the company’s operations to an enormous increase in speculative activity in commodities markets.

“Volatility in commodity markets presented unprecedented opportunities,” ADM chief executive Patricia Woertz told investor analysts in on the call. “Once again, our team leveraged our financial flexibility and global asset base to capture those opportunities to deliver shareholder value.”

Commodities markets have been flooded with investors from out of the credit and housing markets looking for more sound sources of profit. As a result, the grain, metals and oil markets have been subject to rampant turnover of stocks and huge fluctuations in the valuation of the most basic goods.

Financial speculators reap profits from global hunger

By Stefan Steinberg

A series of reports in the international media have drawn attention to the role of professional speculators and hedge funds in driving up the price of basic commodities—in particular, foodstuffs. The sharp increase in food prices in recent months has led to protests and riots in a number of countries across the globe.

On Tuesday, April 22, a UN spokesperson referred to a “silent tsunami” that threatens to plunge more than 100 million people on every continent into hunger. Josette Sheeran, executive director of the UN World Food Programme (WFP), noted: “This is the new face of hunger—the millions of people who were not in the urgent hunger category six months ago but now are.”

A recent article in the British New Statesman magazine, entitled “The Trading Frenzy That Sent Prices Soaring,” notes that increases in global population and the switch to bio-fuels are important factors in the rise of food prices, but then declares: