What is the difference between Chinese socialism and Western capitalism?
In 1972, someone asked Chairman Mao Zedong: "If capitalism were restored in China again, will the common people endure hardship again?"
Chairman Mao said:"You over-estimated them, they don't know what capitalism is? The best they could do is restore the feudal and colonial ways. Capitalism accumulates assets by invading and plundering other countries. Who do Chinese capitalists dare to invade?" "They can only exploit their own people or sell their own country's resources cheaply, in order to satisfy one's insatiable selfish desires."
At that time, people didn't understand and thought Chairman Mao was exaggerating. Most countries in the world are capitalist, and it should not be too bad. But decades later, we now see that he was right.
In recent months, the internet giants in the West, like Facebook, Amazon and Google, as well those in the East, like Samsung, LG, Alibaba and Tencent, are facing increasing scrutiny by the governments because of their monopolistic tendencies.
You may have noticed that the largest IPO in human history, the Ant Financial, was halted at the last minute by the Chinese government in November. Ant Financial talks about big data, algorithms, financial innovation, high-tech, but in fact, it is essentially a money lending company. They use 3 billion yuan as the principal, plus a hundred times leverage, to give out 300 billion yuan in loans. Once something goes wrong, Ant Financial cannot take the burden, and hundreds of billions of dollars of losses would be beared by the country and the people.
Other Chinese internet giants like Meituan, Pindoudou, Didi and Bytedance, etc. do not learn this lesson, but instead propose a new scheme called "community group buying". In essence, these internet giants collectively enter the grocery shopping market of common people in order to harvest the wallets of middle-aged and elderly people. Now looking back at Chairman Mao’s words, do these actions echo his words?
They have a huge amount of capital, but they don’t have the courage to go abroad to expand their territory. Every penny and energy is spent within China. After the e-commerce market is divided, they will release loans, deliver food, taxis, and sell cabbage… When the domestic market is fully carved up and all areas under their giant monopoly, they will be able to enjoy lucrative rental income. By that time, the Chinese could hardly avoid these companies in their everyday lives. At that time, there will be no motivation to innovate.
It is nothing more than the exploitation of the landlord in the feudal era hidden under the skin of the Internet.
China Explained will show you that because of China’s continued success in industrial upgrading, technological innovation and realizing its huge potential, it is an unstoppable process. The inevitable rise of China may feel intimidating and some simply reject it. Don’t be. China’s rise is part of the new global trend unlike what we have seen in the past one hundred years. Embrace the change and seize the opportunity.
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