Isn't it ironic? Don't ya think? A hundred EV companies have bloomed under communism, while capitalism subsidizes one blowhard making four vehicles and one paperweight. A startup has trained an AI for $5.5 million under communism, while capitalist AI requires $500 billion in government support. Everything capitalists told you about capitalism was just some bullshit to sell you more capitalism. Communism is actually far more innovative than capitalism. They do more with less, and for better purpose.

Long, Possibly Unnecessary Historical Digression

The great technical power of communism was actually known from the jump. Russia and China industrialized within one generation. No nations ever developed faster or more, an economic miracle pointedly ignored by most western economists because communism bad, STFU. The productive capacity of communism was discredited because the whole thing seemed to fall with the end of the Soviet Union, but that wasn't all. As Xi Jinping said in 2018,

Historical development is never straight, but full of twists and turns. In the late 1980s and early 1990s, the collapse of the Soviet Union, the fall of the Communist Party of the Soviet Union and the dramatic changes in Eastern Europe not only led to the disappearance of the first socialist countries and the socialist countries in Eastern Europe, but also brought a serious impact on the vast number of developing countries that aspired to socialism, and many of them were forced to take the path of copying the Western system. Socialism in the world has suered a serious setback, as the saying goes, “All flowers are scarce for a while”. I have talked about the journey of socialism from empty thinking to science, from theory to practice, from one country to many countries. It is worth studying in depth....

History always evolves according to its own logic. The great success of socialism with Chinese characteristics in China shows that socialism has not perished, nor will it perish, and that it is flourishing with vitality and vigor. The success of scientific socialism in China is of great significance to Marxism and scientific socialism, and to socialism in the world. It is conceivable that if socialism had not achieved the success in China today, if the leadership of the Chinese Communist Party and our socialist system had also collapsed in the domino change of the collapse of the Soviet Union, the fall of the Soviet Communist Party, and the dramatic changes in Eastern Europe, or had failed for other reasons, then the practice of socialism might again have to wander in the darkness for a long time, and again as a ghost, as Marx said wandering in the world.

Luckily for the world, China was decoupling its model from the Soviet model before the Soviets fell and evolved something quite different (and more robust). As Xue Muqiao said at a World Bank conference in 1982 (all of this via How China Escaped Shock Therapy, Isabella M. Weber, read it, it's excellent),

Xue closed his speech by reminding the audience that China had learned a painful lesson when it copied the Soviet model. This mistake could not be repeated. No change in abstract principles was needed, according to Xue, for the key question was how to reform in practice. China would not pursue indiscriminate or wholesale copying but would take the best from each country and find its own way.

The chief Chinese insight was that the problem required Chinese insight. Chinese communism was branded socialism with Chinese characteristics and with this highly experimental and adaptive economic system, Deng Xiaoping took China to market (without selling off the whole hog). Uncle Deng predicted the trajectory quite presciently in 1987 (in People's Daily):

Poverty is not socialism. We must support socialism, but we must move ahead in building a socialism which is truly superior to capitalism. We must first rid ourselves of the socialism of poverty (pinkun shehuizhuyi); although everyone now says we are creating socialism, it is only in the middle of the next century, when we have reached the level of the moderately-developed countries, that we will be able to say with assurance that socialism is really superior to capitalism and that we are really building socialism.

If anything, Uncle Deng was being conservative. We're only a quarter through the new century and China already has higher life expectancy and living standards than capitalist America. The only thing America leads on is GDP, which measures its corruption, debt, healthfraud, and constant self-stimulation as positives (which they are not). In real economic terms like PPP, China already tops America, and it doesn't prioritize such blunt (dick) measures itself, preferring to look for ‘high quality’ growth than just making abstract numbers go up. As you can see, Chinese socialism is pragmatic more than programmatic. As Deng said in a 1962 speech (which pissed Mao off),

When talking about fighting battles, Comrade Liu Bocheng often quotes a Sichuan proverb—“It does not matter if it is a yellow cat or a black cat, as long as it catches mice.” The reason we defeated Chiang Kai-shek is that we did not always fight in the conventional way. Our sole aim is to win by taking advantage of given conditions. If we want to restore agricultural production, we must also take advantage of actual conditions. That is to say, we should not stick to a fixed mode of relations of production but adopt whatever mode can help mobilize the masses’ initiative. At present, it looks as though neither industry nor agriculture can advance without first taking one step back.

China, of course, had to lay a Maoist foundation to industrialize in the first place, but what to do with that industrial base was the problem in the 1990s. Many post-communist countries threw themselves on the tender mercies of capitalism (feeding socialism to the market) and saw the steepest declines in quality of life outside of wartime. China had a different idea which was markets within socialism. Why not? As Uncle Deng said in 1984,

It is wrong to maintain that a market economy exists only in capitalist society and that there is only [a] “capitalist” market economy. Why can’t we develop a market economy under socialism? Developing a market economy does not mean practising capitalism. While maintaining a planned economy as the mainstay of our economic system, we are also introducing a market economy. But it is a socialist market economy.

Indeed, people have had markets under every type of economic system, The Market™ is not something unique to capitalism, that's just marketing. As Jiang Zemin described socialism with Chinese characteristics in 1992,

Whether the emphasis was on planning or on market regulation was not the essential distinction between socialism and capitalism. This brilliant thesis has helped free us from the restrictive notion that the planned economy and the market economy belong to basically different social systems, thus bringing about a great breakthrough in our understanding of the relation between planning and market regulation.

This is all the historical background that leads to the situation we see now, where Chinese socialism clearly outcompetes western capitalism, as Uncle Deng foresaw. So we're at the point where the modern General Secretary can look back and take a bit of a victory lap. China's success proves that socialism is not dead. It is thriving. Just look.

EVs

Take cars, for example, the most obvious vehicle for conveying national power. The Tesla was an innovation when it started, but now they're just releasing four models and some toy-trucks that brick if you wash them. It's honestly dystopian if you want to buy a pure EV from a pure EV company in America. You can buy an S, X, or Y, or barely usable Cybertruck.

Meanwhile in China, BYD alone sells over 40 models, and there are hundreds of what they call NEV companies, engaged in ruthless competition. China, the communist country, preserves the rational spirit of capitalism while America, the capitalist country, subsidizes one clown car. WTF is going on? It's almost as if the propaganda were bullshit and communism actually works.

The core difference between communism and capitalism is not what (there are markets under communism and state-intervention under capitalism) but for whom. Cui bono? The names communism and capitalism tell you all you need to know. Under communism the community is most important whereas under capitalism it's capital. The difference between communism and capitalism is not that hard to understand, etymology is enough. Democracy™ and Human Rights© are just marketing taglines capitalism uses to obscure the obvious, that it's rule by capital above all.

The problem is that capital is not actually very good at allocating capital. As Biggie said, one should never get high on one's own supply, which American capitalism has been doing since the massive deregulation of the 1980s, which is now uniparty policy (Congress is just an insider trading club now). Stock buybacks, bullshit valuations, pump and dumps so big the government bails you out. The core question, as always is for whom? Communism allocates resources for some common purpose (socialism for the social purpose) or Islam for God (who is surely the best planner); many economic systems are possible depending on ‘for whom’. Capitalism is marketed as some all-purpose solution for general good, but it's not, it's just for increasing capital, as it says on the tin. Capitalism is not a system for governance so much as a system for dismantling governance for its own metabolic needs. In short, a cancer.

Communism (or any -ism that isn't centered around money) is capable of allocating capital for a different purpose beyond just reproducing capital. Like reproducing humans and (theoretically) reproducing nature and not killing us all. There are many different directions possible if you direct your economy towards something rather than just ‘growing your economy’. That is circular logic which divides by zero at some point. You cannot have infinite growth on a finite planet.

Communist industrialization, of course, leads to the heat death of life on earth as much as capitalist industrialization, but there is at least the concept of a shared community which might include all living beings, rather than share capital above all things (I'm musing purely theoretically here). If communist liberation movements (there has never been a Capitalist Liberation Front) had not been brutally suppressed across the world last century, we might have had a fighting chance to stop climate collapse and resource exhaustion by the 1970s, when it was possible. There is at least the theoretical concept of a brake within communism, whereas under capitalism it's all accelerator.

This is the core reason communism makes better cars and artificial incarnations today. China produces cheap, functional EVs and not luxury virtue signalling devices. China produces cheap, efficient AI and not luxury investment vehicles. Communism has a reason behind production while capitalism is just irrational growth for growth's sake (ie, cancer). None of this will save the world (it's too late) but we can at least say ‘I knew it’ to machines that don't care while we're tooling along the highway (to hell).

AI

Now take AI, another vehicle for conveying national power (which also destroys the natural world). Conversational AI was last place where western capitalism could be said to work. AI was like the quarterback of the tech industry, the last place a white man could lead. But now that lead has been obliterated by DeepSeek.

At the same time the US government was announcing a $500 billion oligarchy investment in OpenAI, DeepSeek released a comparable model that had been trained on $5.5 million. Under communism a private entrepreneur came up with DeepSeek out of pocket, while under capitalism the President had to stand next to Sam Altman, holding his hand. What's going on here?

The problem again is that capital is not very good at allocating capital. It will just give the money to itself. This is another digression, but at a very high level, Jamie Merchant describes how, “Traditionally, some form of planned economy is taken to be the alternative to market institutions, but there is not much planning happening here. Rather, this is something new: the abolition of the market without planning.” What Merchant means by the ‘abolition of the market’ is important. America effectively arrived on central planning without planning. A cartel of banks just moves interest rates around, and the government gives them free money to do it. It's all centrally controlled, but without a brainwave among them. As Merchant continues,

As the premier capitalist country, the US essentially takes on the mounting costs of reproducing the deteriorating conditions for global capitalist production, which show up as an exploding Fed balance sheet and national debt. At the same time, the expansion of governance into private finance and of finance into government erodes the basis for the market’s competitive function. The further this dynamic progresses, the more the scope for the market shrinks; the more the market shrinks, the less profitable private production becomes relative to the revenues to be collected through finance; the less profitable private production becomes, the more the accumulation of capital is exhausted, requiring ever more drastic state intervention just to keep its heartbeat going, which further erodes the basis for the market. Traditionally, some form of planned economy is taken to be the alternative to market institutions, but there is not much planning happening here. Rather, this is something new: the abolition of the market without planning.

What Merchant is describing is the fact that America in 2008 bailed out the big banks without taking equity stakes (ie nationalizing them). It did the same thing to the big car companies. The market said these companies were dead but the US government just said no and kept them going. The ‘creative destruction’ of the market was abolished, ie the market was abolished without planning. The US government was just reacting to crises, but ended up creating a conundrum that they can't get out of. Their whole economy is a giant Ponzi scheme and there is no reverse Ponzi. In this oligarchic system, the only purpose is make line go up, to keep the high going as long as possible. In that sense, having a product that works well and cheaply is actually a terrible comedown. It lowers profits (which are increasingly irrelevant) and worst of all lowers spending. As Merchant continues, “The asset management firms Blackrock, Vanguard, and State Street Advisors are the largest single shareholders in 9 out of 10 companies on the S&P 500, on average owning more than 20 percent of the shares of every company on the index, so it is naturally in their interest to discourage any competition that could lower profits.”

In this capitalist context, what is the purpose of a $5.5 million AI system? What is its value to those for whom the opening bell tolls? Why would any capitalist want such a thing when we've got this $500 billion hustle going on? Offering cheaper, more efficient anything to bankers is like offering them a hand towel in the nightclub bathroom. That's not what they're in there for. At work or play, they're trying to make that line go up as fast and furiously as possible.

As Matthew McConaughey says in Wolf Of Wall Street:

You have a client who bought stock at 8 and later announced it's at 16 and he's all happy he wants to cash in, liquidate, take his book, take his money and run home. You don't let him do that, okay, 'cause that would make it real, right? No. What do you do? You get another brilliant idea, a special idea, another situation, another stock to reinvest his earnings and entice him, and he will, every single time, 'cause they're addicted. You just keep doing this again and again and again. Meanwhile, he thinks he's getting rich (which he is, on paper), but you and me, the brokers, we're taking home cold hard cash via commission.

AI was the golden goose that VR was supposed to be, it made NVIDIA's line go up and the ‘magnificent seven’ crowded into the bathroom stall to get high AF. The more GPUs (and energy and water) these products consumed the better. AI was a magical product with frankly mythical benefits that had people lining up to throw money at it. That was the value of AI in the capitalist system, not AI itself. Again, remember that capitalism perceives no human need but greed. It doesn't care what the product does, how much energy and water it burns, as long as it makes line go up, be it in the nose or news.

But now in China they're facing a ‘competitor’ (everyone besides America is happy to work together) that upends their main hustle with a side project. DeepSeek was a side-project of some financial quants (algorithmic traders) with a dream and some spare GPU capacity. Conversational AI is a side-side-project in China which has a real economy building real things, and where AI is primarily used for boring business cases, not idle chatting. And so DeepSeek is released open-weight (effectively open-source) because they don't give a shit. As DeepSeek's CEO said,

In the face of disruptive technology, a closed-source moat is temporary. Even OpenAI's closed-source approach hasn't stopped others from catching up. Our value lies in our team, which grows and accumulates know-how through this process. Building an organization and culture that can consistently innovate is our real moat. Open sourcing and publishing papers don't mean we lose anything. For technologists, being followed is an achievement. Open sourcing is more of a cultural act than a commercial one. Giving is a form of honor, and it attracts talent by fostering a unique culture.

OpenAI is just a branding term, but DeepSeek is actually doing it. Nobody's trying (or able) to become some rentier oligarch in China, they already collectively own the means of production through the Communist Party. People can certainly get rich, but China's target is ‘moderate prosperity’ and ‘high-quality growth,’ not fuck-off money and growth at all costs. This leads to very different products. It's actually a completely different culture.

Isn't It Ironic?

As Alanis Morissette said, isn't it ironic, don't you think? Capitalism was supposed to be this great engine of ingenuity, but it's congealed into monopolization, corruption, massive waste, and pump and dumps. Communism was tarred as the death of individual initiative, but they've got hedge fund guys doing game-changing AI as side projects. Note that I don't mean conversational AI itself is game-changing, I mean that DeepSeek exposes the shell game American AI companies (and chip-makers) were playing. I haven't even gotten into how China outcompeted America on social media and basically every domain they care about, and the domains they don't care about, like, health, housing, education, and actual human needs.

If you read even thinly into the history of these economic systems, it's not that hard to explain. Communism has a purpose beyond profit and the economy can be directed for some human (or ideally natural) purpose. Capitalism has no purpose beyond profit, and just degenerates into fraud. These systems are not the same. Capitalism is worse.