China: Shanghai lockdown – capitalism cannot contain COVID

Not long ago, the Chinese Communist Party (CCP) regime was proudly flaunting its successes in containing the COVID-19 pandemic compared to much of the rest of the world. Now, however, one of its major economic centres, Shanghai, is suffering from a surge of the Omicron variant, made worse by bureaucratic blunders.

These events are exposing the workers of Shanghai and China more broadly to the very same capitalist contradictions that their class brothers and sisters experienced all over the world, which had the effect of drawing out the pandemic and deepening its effects. These experiences can lead millions to question the system like never before.

“Zero Covid” in One Country?

Since March, the spread of the virus went into full swing in Shanghai, and the government shows no signs of relaxing its harsh new lockdown measures at the time of writing. While new cases in early March were in single digits, by April daily new caseloads went up to as high as 25,173.

Although China’s swift, timely, and severe lockdown measures in the earlier periods allowed it to stave off the virus, despite being the most populous country in the world, as long as it remains integral to the world’s economy, China cannot be sheltered from a virus that has been ripping through the rest of the planet.

As we warned many times, the virus cannot be defeated anywhere until it is eradicated everywhere, which on a capitalist basis has proved impossible. This was the same reason New Zealand, which also initially ran a largely a successful “Zero Covid” policy, had to eventually admit the failure of and abandon this elimination strategy. For Shanghai, a crucial port city that trades with over 200 countries and houses 758 multinational corporation’s headquarters, an Omicron outbreak was always a matter of when, rather than if.

On the basis of capitalist competition, profiteering and the nation state, no single country can effectively resolve global crises such as a pandemic or climate change. The CCP regime, despite its name, is committed to maintaining the capitalist system that has proved so detrimental to fighting the pandemic, by dividing and pitting countries against one another.

Bureaucratism: a deadly disease

The lightning spread of the virus forced the Shanghai city government to change its original ‘targeted testing’ approach into a full lockdown. The lockdown in turn caused massive problems in terms of food supplies and basic healthcare provision. The closure of markets and traffic in turn shut down the transportation of food. Despite the state’s relentless efforts in showing the masses that everything is under control, the skyrocketing prices of vegetables, meat and many essential supplies, and all manner of other difficulties in the masses’ daily lives, rapidly pierced these illusions.

In the past two years, the CCP state endlessly claimed that China’s relative success in containing the virus stems from the strength of its domestic policy of “Socialism with Chinese Characteristics.” This in turn was used to fan reactionary patriotism among the masses and distracted them from the brewing crisis of capitalism. The state of affairs in Shanghai slams squarely against the official state narrative, and it is no accident that national news outlets continue to downplay the reality of the situation on the ground.

But the contagiousness of the virus is not the sole source of the ongoing crisis. The rigidity and commandism of Shanghai’s political bureaucracy has led to chaotic and ultimately ineffective results.

In the early stage of the viral outbreak, the leadership’s solution was to simply decree mass PCR testing. Yet with a lack of staff and equipment, the PCR testing centres themselves became hotbeds for transmission. The masses were ordered to stand in meandering queues, which are handled by only two or three doctors, which led to tests taking hours to complete. Misallocation of staff sometimes required doctors to travel great distances to handle the queues of people waiting for their tests.

The leadership’s decision to isolate all those who tested positive in makeshift quarantine facilities similarly led to many problems. In response to the rapid rise in case numbers, massive numbers of “Fancang hospitals,” or makeshift hospitals, were erected in haste. But a shortage of staff and general medical resources led to situations where some of these makeshift hospitals were only administrated by one or two doctors. Of course, the medical workers were not rewarded with any kind of rise in wages and benefits despite the heightened workload.

The lockdown has resulted in a squeeze in regular healthcare provision, unrelated to the virus. Since the end of March, almost all hospitals in Shanghai saw their emergency departments closed down. The strict order for the masses to shelter in place further blocked their access to essential medical care, thus delaying treatment. In the early days of the lockdown, there were times when people who needed dialysis were blocked from accessing it due to the restrictions.

Medicine became much harder to purchase, and because of this many people have to face the physical consequences of delaying or prematurely ending their treatment regimens. Even worse, many who required emergency care did not receive it due to the mismanaged lockdown, and thus lost their lives, among them the mother of famous economist Lang Xianping. According to a report by Caixin, although the shortage of chronic disease medicines has been relieved somewhat, those for cancer treatments and mental diseases remain.

These problems reflect the contradictions within the Chinese healthcare system that were already brewing well before the pandemic, which in the final analysis are the consequence of capitalism itself. The restoration of capitalism in China led to longstanding problems that are at the immediate root of why “Zero Covid” policies falter in face of a more contagious variant of COVID-19:

1. The relentless effort by the state to privatise hospital and health insurance system, which led to a shortage of resources given to public hospitals and poor allocation in resources across different regions;
2. Since the marketisation of healthcare system that began in the 1990s, the state has accrued large debts in the field of public health spending;
3. The need to balance the budget in healthcare further led to lowering of wages for doctors working in public hospitals and facilities. The low wage and high-intensity working conditions for doctors then generally lowered interests in the profession, which causes an overall decline in trained doctors;
4. The vaccine nationalism that the CCP fanned up domestically, relying almost exclusively on Chinese-made vaccines, and restricting access to vaccines made by other countries.

Skyrocketing prices

Skyrocketing prices in food and daily goods came immediately alongside the lockdown. The store shelves have long been bare, so the two main ways for people in Shanghai to get food and goods are either group purchases online or direct distribution from the various district governments.

But the latter is usually ignored, as the masses never know when the governments would actually distribute the resources. Even when they do, the quality of the foodstuffs and goods they receive are usually subpar. Availability of goods varies greatly across different districts. It is often hard to know whether a shortage of goods is caused by genuine disruption in the logistics, or by bureaucrats at some level deciding to hoard the goods and refuse to distribute them.

Group buying remains the only viable way of actually getting much-needed resources, but vendors exploit the opportunity to mark up the prices to pocket enormous profits. For example, a vendor in Chongming District was selling a 5kg variety bundle of vegetables for over 280 RMB (around 42 USD). Another vendor was selling chickens at 1.5kg for 160 RMB (around 24 USD). These are the unit prices for group buying, and the vendors often require at least 10 units per purchase in order for the food to be delivered.

The crisis in commodity prices caused by supply shortage and price gouging fundamentally reveals the nature of the “market” that the CCP holds sacrosanct. A viral outbreak does not change the fact that goods will continue be produced and sold for the sole purpose of generating profits, and during a lockdown where demand suddenly escalates, the “rational” thing for every individual vendor to do is to raise prices and maximise their profits. Only a planned economy, which the CCP destroyed in China through its own efforts, could have prevented such chaos from arising.

The economy tied in knots

Perhaps the biggest contradiction in the situation lies in both the insistence on locking down the population, while opening up the economy. In past years, the global pandemic already caused significant setbacks for the Chinese economy. Although it managed to recover quicker than most Western countries, this was largely felt by the ruling class, while the masses are still slowly grappling with the fallout of the initial shocks. Now, the outbreak in Shanghai casts a shadow over China once more.

Mass PCR testing and a lack of staff and equipment has meant that the PCR testing centres have become hotbeds for transmission / Image: gov.cn

The brunt of the economic costs of the pandemic is naturally put on the shoulders of the workers. The lockdown in Shanghai led many to outright losing their jobs, as they were prevented from working. Yet at the same time people are still expected to pay rent and mortgages, while also having to pay for daily necessities at a much higher price. Although some enterprises have been able to pay their employees during lockdown, other workers are not so lucky.

Small vendors, truck drivers, delivery drivers, temporary workers in markets, construction workers who are paid by the day, as well as those employed in factories as subcontract laborers, are left to their own devices.

Restrictions and repression

As the situation becomes increasingly unbearable for the ranks of society, the bureaucracy continues to crack down on any expression of dissatisfaction online, the only arena where Chinese people tend to express their discontent in a highly restrictive environment. The main message boards and forums prioritise posts that express views approved by the government, often sob pieces that express vacuous sentiments like “I stand with Shanghai!”, and “Thank you government and medical workers for your hard work!”

Any views that detract from the approved line would be hidden from public view or denounced as “rumormongering.” This is especially true for reports or discussions on physical clashes between the masses and local bureaucrats. Small scale riots have been taking place around Shanghai, and many of these have been filmed and uploaded online to show the real situation on the ground, only to be censored shortly after.

Some footage managed to gain significant amounts of views before being removed, but has still attracted too much attention to be simply neglected. The state always accuses these of being forgeries and rumours. This was how footage of a significant riot, uploaded on 24 March, was dismissed by state media. Who would be the culprits for producing this “rumormongering, doctored footage”? The answer, of course, are the “hostile foreign cyberforces” of Taiwan!

But no matter how forcefully the regime tries to silence discontent, it nevertheless exists and is brewing among the masses. The masses are growing wary of the official propaganda, and nothing will stop this trend as long as capitalism continues to exist, with all the misery and contradictions it creates.

Crisis in the lower ranks of the bureaucracy

Significantly, the chaotic commandism from the top of the bureaucracy is also creating a crisis in the lower ranks of the state, and state workers. The cross-current of pressure from both above and below in the situation is simply too much to bear. Many of Shanghai’s residential committees, which in effect are the government’s bureaucracy at the neighbourhood level, have resigned en masse. There are also widespread audio recordings of frustrated government workers tearfully admitting to desperate callers, asking for help, that there is nothing they can do due to directives from the top.

Workers who have been mobilised by the state to contain the outbreak in Shanghai are also placed under fire. Many of them were hastily brought in from other parts of the country but don’t have their accommodation in Shanghai properly arranged. All the while, they are immediately put on extremely high-pressure work schedules to erect makeshift hospitals. Many of them end up contracting the virus and are stuffed into the quarantine tents that they built themselves.

Socialism or barbarism

The pandemic has revealed the ugly nature of the Chinese bourgeois government, tearing off its mask of hypocrisy. The politicians’ empty words cannot fill the bellies of the people of Shanghai, they cannot provide timely medical resources to those needing treatment, they cannot provide the people who have lost their jobs with a living income, but they can defend and maintain the profit-driven, anti-human capitalist system for the benefit of the ruling class.

The crisis in Shanghai today adds fuel to the fire in the Chinese economy, which was already mired in slowdown and debt. Shanghai alone is responsible for a third of all China’s foreign trade, and is the second-highest-paying taxpaying city to the central government. A disruption in Shanghai on the scale we are seeing today is sure to place another jetstream of pressure into the economy. Moreover, whatever happens in this important cultural and political centre of China can have an outsized impact on the consciousness of the masses. This is not to mention the reciprocal impact on the world economy, stricken by an inflationary crisis and the effects of the Ukraine War.

The old world, to which capitalist China belongs, is in crisis, and the new generation expects a new beginning. Humanity today is facing a choice between barbaric destruction or a socialist future, and the chaos in Shanghai is yet another illustration of what barbarism could look like. As we have explained in previous articles, only a planned economy, workers' democracy, and internationalism can put a final end to the pandemic, and all the horrors in capitalist society. And these ideas are what the International Marxist Tendency is fighting for.