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p M. Kubeshova (Czechoslovakia)

p Throughout the PRC’s more than 20 years, economic policy has been one of its most important problems and has had a powerful influence on the development of its socialist system. Economic policy has nearly always been in the foreground of the Party leaders’ activity and has given rise to sharp disputes and internal struggles within the CPC. Still, the CPC leadership headed by Mao Tse-tung has proved unable in the course of the more than two decades to work out, establish and implement a policy that would ensure the country’s steady progress.

p Mao Tse-tung’s economic concept comprises two extremes, with now one and now the other standing out most clearly. At first, there was a distinct urge to step up to the utmost socialist construction as a whole and expedite socialist change in the relations of production in particular. Some socialist transformations in the forms of property were carried out over a short period, but, despite the various experiments that followed, these failed to ensure the country’s steady economic growth. Instead of pursuing a sober, realistic policy, the Peking leadership swung to the other extreme, namely, underestimation of the potentialities for economic growth and lack of faith in the possibility of gradually raising the working people’s living standards and satisfying their material needs. Hence the orientation largely upon the use of organs of suppression and military means to ensure the stability of the system and establish a military-bureaucratic dictatorship.

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p Of course, Mao Tse-tung’s economic concept has not been accepted unreservedly. On several occasions, the CPC has succeeded in sweeping aside his extremist demands, eliminating the arising difficulties and opening up the way for a realistic policy mindful not only of Chinese experience but also of that of the Soviet Union and other socialist countries. To do away with the opposition inside the Party, the Mao leadership used various forms of struggle, above all suppression of any critical remarks. Thus, in 1957, there was the so-called movement to improve the style of work, aimed against the opposition to the comprehensive implementation of Mao Tse-tung’s economic concept and the “great leap forward" policy (1958-60).

p The “great leap forward" was a pretentious experiment meant to effect a rapid change in the level of the productive forces, overcome the economic backwardness and make China the first of all socialist countries to introduce—by fiat—the communist mode of production. The CPC leadership itself had largely to admit the failure of its policy, but blamed it on the opposition constantly coming out against the “great leap forward" method.

p In view of the negative consequences of the experiment for China’s further economic and political development, let us deal with some of its major mistakes in greater detail.

p The “great leap forward" concept was basically subjective in its assessment of China’s economic and political situation and the prospects and possibilities of its economic development. Thus, for instance, it attached too much importance to the subjective factor in economic construction, maintaining that any economic growth could be attained so long as men wanted and were resolved to attain it. Every objection was taken to imply lack of faith in the people’s strength, an expression of defeatism, and as such was given a blunt rebuff.

p The concept was based on the choice of maximum, superhigh economic growth rates derived from an unrealistic assessment of the country’s actual possibilities. For several years the demand for a high growth rate was at the root of all the Mao leadership’s economic and political measures, which acted on the idea that a fluctuating economic growth rate was natural for any country, let alone an economically backward one. But from here it went on to the erroneous 151 conclusion that everything depended solely on the subjective effort and resolve in planning and attaining high growth rates. Projects without a sound technical or economic backup made it impossible to work out a truly balanced plan and served to encourage the laying down of patently unrealistic production targets, something that made itself felt at the initial planning level, statistics at the enterprise, and also in national-economic administration.

p The concrete content of the “great leap forward" economic policy took shape on the basis of different, often diametrically opposite, principles, which stemmed from real and sometimes imaginary current needs of the Chinese economy, principles that were essentially pragmatic. There was nothing coherent about the policy, so that in the three years from 1958 to 1960 it underwent several marked changes. Its main versions gave priority to some individual sectors of the national economy, and also used the so-called mass movement method in production and capital construction. The question of showing social preference to some individual sectors of industry or farming, to industrialisation or the “self-reliance” line in intensifying farming was one of the main questions of China’s economic policy. However, it was tackled differently from one stage to another, largely through voluntarist methods. Thus, at the beginning of the three-year “great leap forward”, the emphasis was on agriculture, whose development was taken to be as important as that of industry, whereas in the latter half of 1958, things took quite a different turn: economic policy was geared to a one-sided preference for industrialisation. In 1959 and especially in 1960, the principle was gradually revised and gave way to the “agriculture is the basis of the national economy" principle, which once again gave priority to agriculture as the key sector of the economy and the starting ground for its comprehensive development. A characteristic point to note is that success was greatest when farming was put on a par with industry. The crisis was also eased when farming was the priority area, but on the whole there was no due interconnection between the two major economic sectors.

p The mass movement method was another vivid manifestation of the undue emphasis on the subjective factor, The 152 method was applied to the mobilisation of the large unused manpower resources in the building of irrigation systems in the winter of 1957-58. Following the first experiment, the mass movement method was mechanically applied to other areas, above all, the building of small blast-furnaces and metallurgical production by primitive means. Despite the negative results of the campaign, the mass movement method was still being used, and a so-called mass movement for technical improvement was being carried on, but that was confined to industrial production and its intensification without the involvement of fresh manpower. The movement yielded some positive results in modernising and renewing the product mix, but failed to bring about any quantitative increase in production. These measures were aimed to prevent a further decline in production. In the major sectors of the economy and the chief areas of activity, the mass movement method was used only in 1958, and in the following years was confined to some particular areas.

p The mass movement was not the only way of involving free manpower in the economy; the changes that took place in the countryside during the “great leap forward" as a result of the establishment of the “people’s communes" were also meant to improve the use of manpower resources. Too much importance was, of course, attached to the role these changes were to play in speeding up growth in farming which had no adequate material basis created for it. It subsequently became clear that production could not be increased through administrative and organisational methods alone. The Maoist leaders’ subjectivism in assessing the actual economic situation was also expressed in their neglect of some important economic factors limiting the possibilities of faster economic growth in China: the size of the manpower pool, the consumer barrier, and the limited material, organisational and other possibilities.

p One of the two main sources feeding the “great leap forward" policy was the apparently large pool of free manpower, which emerged as a result of overt and latent unemployment and which was above all to be involved in capital construction with low capital and high manual-labour inputs at low wages to ensure considerable growth of the net product.

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p The countryside was the largest source of manpower reserves, and these were to be used on the spot chiefly to intensify agriculture through irrigation, better fertilisation, deeper tillage and other agrotechnical methods. These reserves were also used to lay the production groundwork for modernisation in the form of local repair shops. The fresh manpower was also to help ensure better allocation of investments, and location of production, and improvement of the sectoral structure of the economy. But the concrete possibilities of the use of manpower resources were ignored: during the winter season, large numbers of men were in effect unoccupied, tiding over the winter with very little to do and as little to eat. The large-scale mass movement in the winter of 1957/58 led to a steep increase in food consumption and a virtual depletion of the food stocks, and this had an unfavourable effect on production the following year. Nor was any attention paid to the fact that most of the manpower employed in the economy had a low labour productivity, which could not be increased to any marked degree by mere fiat or the working people’s subjective effort.

p By the summer of 1958, the manpower reserves had run out: urban unemployment had virtually been eliminated, many farmers had left the countryside for the towns, and agriculture was unable to provide any more manpower during the farming season. In the summer of 1958, manpower shortages became the country’s main and most discussed economic problem. And although the “people’s communes" did not release any manpower, more “mass movements" were announced. Manpower was thus dispersed, something that had a negative economic effect. In agriculture the effect was in fact catastrophic. Thus, in 1958 the farmers were even unable to harvest the whole summer crop—an unprecedented state of affairs in China. Many farmers had to be sent back from the towns to the countryside, thereby holding up urban capital construction and damaging production in many industries.

p The unrealistic approach to the possibilities of drawing on the pool of unused manpower, and the rechannelling of that manpower into capital construction and various lines of production, without any attention being paid to labour 154 effectiveness, may be regarded as one of the basic mistakes which made the prodigious “great leap forward" effort on the part of hundreds of millions utterly futile.

p Another basic reason for the failure was the unrealistic assessment of the possibilities of increasing the accumulation fund. Under the original plans, the latter’s increase and utmost concentration on the larger projects were to have been a source of a sharp economic upswing within the “leap” concept. The “leap” policy, however, failed to reckon with the fact that accumulation possibilities were limited by the low labour productivity and the danger of excessive accumulation at the expense of the consumer fund.

p The consumption level in China is so low that for the bulk of the population it is somewhere round the bare subsistence minimum required to restore labour power. This level cannot be lowered, however selfless the people, for that would inevitably impair their capacity for work. Thus, in Chinese conditions the consumption barrier is a most important factor holding back economic growth. During the “great leap forward”, this barrier was repeatedly in the way.

p For the first time, the economy came up against that barrier in view of the demand to increase investment both in central and local enterprises, particularly after the establishment of the “people’s communes”, which sought to channel into accumulation too great a share of their income, even at the expense of the farmers’ individual consumption. At the same time, they introduced various measures which upset the market balance: on the one hand, they wanted as much of their own products as possible to be consumed inside the commune itself and limited their marketing, and on the other, they introduced cash wages, so exerting strong pressure on the commodity market and extracommunal production. The two measures served to upset the market balance, shaky and poorly regulated as it already was, and resulted in a supply crisis which broke out in the winter of 1958/59.

p The crisis worsened once the output of farm produce fell in 1959 and that of industrial consumer goods—in 1960. The forced lowering of consumption had a marked effect on further economic policy. In other words, the disproportion between the unsatisfactory production and the consumption 155 requirements led to a slowdown in the economic growth rate even before the end of the “great leap forward”.

p The material supplies that would be necessary to ensure investment growth and production were not determined well enough either. In the first period of the “great leap forward”, when capital construction in farming was the main area of prospective growth, the materials shortage was still fairly moderate, but as soon as priority was shifted to metallurgy, the shortage of raw and other materials became a major obstacle to its development. Shortages soon developed throughout the whole of the heavy industry and, from 1959 onwards, in the light industry as well, which was affected by the poor harvest. The shortage of raw and other materials was one of the main factors behind the drop in industrial production in 1960 and the next few years, particularly when foreign trade proved to be incapable of satisfying the economy’s vast requirements; foreign trade itself at that time was largely switched to food imports.

p The large volume of capital construction, the growing scale of production and, particularly, the mass movements put a very great strain on economic administration, planning and statistics, and the effort to co-ordinate the various economic areas and to establish due proportions between the economic sectors, specifically those between industry and farming, the extractive industry and manufacturing, the heavy and the light industry, production and transport capacity, and so on.

p The impossibility of carrying out the unrealistic tasks of the “great leap forward" led to a considerable increase in anarchistic tendencies in economic administration. These were most pronounced in the mass movement, which was to have substituted “grass roots" initiative for organised investment and production. They showed most clearly perhaps in the movement to set up the “people’s communes”, where only general outlines of the new producer units were decided in a centralised manner until the most suitable forms were found by trial and error.

p These anarchistic tendencies were also reflected in the concept of general economic administration. One typical example was the practice of deliberately creating disproportions by singling out various particular sectors as a basis 156 for automatic economic administration. The idea here was that any kind of economic growth led to imbalances in the national economy, upsetting the proportions between the various branches. This was seen as the natural dialectics of economic development and was not to be hindered but, on the contrary, to be utilised or even, wherever necessary, to be created deliberately. The conclusion here was that so long as one major economic sector was administered in a centralised manner, the other sectors would develop in line with the former. The development of metallurgy, for instance, would create a demand for raw materials and boost their production. Metallurgy would provide raw materials for engineering, which would then develop and provide for agriculture, which, for its part, would increase the output of farm produce, raise its labour productivity, and so on. The practice of 1958, however, served to refute these oversimplified notions of economic administration.

p What was the reaction inside China to Mao Tse-tung’s “great leap forward" concept? At first it brought about various changes in society, above all, a marked increase in the working people’s mobility, not only due to political factors, but to some extent also to material incentives, for from the outset the “great leap forward" concept was linked with the near prospect of a rich and happy life. This Mao Tse-tung sought to emphasise in his concise formula for the “great leap forward": “In three years to change the face of most of the country’s areas.” Another slogan to that effect promised “ten thousand years of prosperity" in return for “three years of hard work”. One of Mao Tse-tung’s more concrete promises was a higher living standard for the population, better food and clothing for all. Thus, an article by member of the CPC Central Committee’s Politburo, Tan Chen-lin, carried by Jenmin jihpao on August 11, 1958, quoted Mao Tse-tung’s characteristics of the “people’s communes" and the happy way of life they were to usher in. Tan Chen-lin wrote: “During his meeting last June with farming co-operative Chairman Yin Tsiu-ya, Comrade Mao Tse-tung set out before those present his idea of a happy life and also determined our concrete and urgent task: for every person this country should produce an annual average of 750 kilogrammes of grain, 50 kilogrammes of pork, 10 kilogrammes 157 of vegetable oil and 10 kilogrammes of cotton. We can say with full confidence that this happy life is not a very long way off, and that it is quite possible to attain or even to tap these targets in a short period.”

p In the autumn of 1958, when the negative effects of the “great leap forward" policy were beginning to show, there was a sharp change of mood throughout Chinese society, with the enthusiasm of the early stages petering out rapidly first in the countryside and then in the towns. The “great leap forward" caused a drop in the working people’s living standards, which led to disenchantment and social instability. The “leap” policy was up a blind alley and could not be continued, nor was it possible to go back to the pre-1958 state of affairs. The fiasco of the whole policy, the “people’s communes" in particular, had an immediate effect on the situation in the countryside: agricultural production dropped considerably and, despite the bumper crop of the summer of 1958, supplies became much worse. The exhausting capital construction campaigns made the situation even harder.

p The first reaction came from the peasants, who did not see any rise in their living standards even with the bumper crop of the first “leap” year. This applied, above all, to the middle farmers, who had the highest skills and had suffered from the egalitarian distribution in the “people’s communes”. These were, naturally, joined by the richer farmers, who had earlier been barred from co-operative membership altogether, and were now included in the communes (like the rest of the rural population). There was, therefore, a fairly broad section of farmers who opposed the new order in the countryside, and as the situation worsened that section swelled considerably because of the dissatisfaction among the poorer farmers. The class stratification, which had been obscured with the establishment of the co-operatives, again became more pronounced. The mounting tensions upset the relative stability of the countryside. In the situation, the leadership of the CPC and the “people’s communes" chiefly relied on the poor peasantry, but did not have a broader basis and, in the final count, the experience of the numerous middle farmers. In consequence, there were more difficulties in transforming and improving the “people’s communes" in 1959-60.

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p Chinese agriculture and the “people’s communes" were harmed most by the disruption of the subconscious bond between production work (its scale and quality), on the one hand, and the communes’ payment system, on the other, and also the loss of incentives to develop collective farming and the farmers’ slide-back into their old state of indifference. That was the gravest social effect of the “great leap forward" policy, considering the farmers’ share in the overall size of the population. It will, apparently, be impossible for a very long time to come to reinvigorate the mass of peasants on any considerable scale. Thus, as the “cultural revolution”, which followed upon the “great leap forward”, was launched and developed, it was confined to groups of young people in the towns and bypassed the peasantry, the bulk of the Chinese population.

p The Chinese workers’ response to the “great leap forward" policy was at first very vigorous. In 1958, their numbers rose steeply, but from 1959 on began to fall in view of the manpower shortages in agriculture and supply difficulties in the towns. These developments, added to the enforced return of millions of new and old workers back into the countryside, where for the most part they were given a less than hospitable reception, being regarded mostly as so many more mouths to feed, had a very strong influence on the urban working class, and its labour and political vigour. Its living standards declined. At the end of 1960, tensions between town and country were exacerbated following the restoration of the free market with its high prices, which were advantageous for the farmers, but forbidding for the urban working class. The “leap” policy did nothing to eliminate the tensions between town and country that had existed before the “great leap forward" owing to the workers’ higher earnings and living standards but, serving to worsen relations between the working class and the rural population, increased these tensions and threw society into even greater disequilibrium.

p The intelligentsia was to play a minor role in the “great leap forward”. The realistic policy of 1956-57 reckoned with the intelligentsia to a much greater degree, whereas during the “great leap forward" it was the masses who were to act, and the intelligentsia was assigned the passive role 159 of explaining and justifying the politicians’ decisions. There was no particular enthusiasm for the policy, but the goals of the “great leap forward" were so attractive (it was aimed to overcome the backwardness and carry the country to the top of the world in economic and social development) that a sizable section of the intelligentsia came out in its favour. Wherever no spontaneous support could be mustered, enforcement measures were eventually applied, first in a movement against so-called Right-wingers, and then also against so-called Right opportunists.

p In other words, the intelligentsia’s attitude to the “great leap forward" successes was at first positive, though hesitant. But when the misgivings that the “leap” did not provide any real way out were confirmed, the intelligentsia moved into the background. It was no longer consulted, and the leadership did not show any interest in whether specialists could suggest any way out of the political and economic crisis. Fear of persecution and particularly of dispatch to the countryside bore on the intelligentsia throughout the whole period. Towards the end of this period, when the need for specialists began to tell, the way out was seen in mobilising the experience of veteran workers and peasants. Later, when the mistakes of the “great leap forward" were being redressed, there were some short-term improvements in the intelligentsia’s position.

p Despite the ultra-revolutionary goals of the “great leap forward" policy, it did not have any marked effect on the position of the Chinese bourgeoisie. Having handed over its enterprises into state management (as so-called mixed, partially state-owned enterprises), the bourgeoisie continued to receive considerable interest payments on the property they had given up, which sometimes ran to millions of yuans a year. The Chinese leadership maintained its relations with the bourgeoisie even at the most turbulent periods. It was with their interests in view that the establishment of the “people’s communes" in the towns was first slowed down and then wound up altogether. The bourgeoisie’s vital interests were also affected by the difficulties caused by the “great leap forward”, but it always had some advantages in supply, in receiving mail from abroad, and so on. The capitalists’ large incomes made them immune to the negative 160 side of the free market in foodstuffs. The supply crisis, naturally, added to the tensions between the capitalists and ordinary citizens, who enjoyed no such privileges.

p The “great leap forward" policy had a very strong effect on the leading Party, state and economic cadres, or the “kanpu”, splitting them into two major groups: those for and those against the “great leap forward”. Among its opponents were ranked all those who voiced any doubts about the correctness of some of its postulates, to say nothing of the relatively few cadres who criticised and rejected the whole policy. Anyone who criticised it or doubted its correctness were branded enemies, Right-wingers, and later Right-wing opportunists, and most of them lost their jobs and were persecuted. Persecution did not usually mean physical extermination or legal proceedings, but the favourite Chinese method of “remoulding” by manual labour in the countryside. In this way the Party was deprived of many experienced leaders, men who had most political foresight.

p As the opponents of the “great leap forward" were being suppressed, those who accepted the new political line strengthened their positions. At first it seemed that the new policy was giving senior functionaries broader opportunities to display their abilities. In the localities, the greatest vigour and initiative were required, particularly in the implementation of the “people’s communes" policy and the consistent fulfilment of orders from the centre, as, for instance, in the movement to build small blast-furnaces. But once the results of this effort failed to justify themselves and had a negative effect on China’s socio-economic position, criticism was directed against “incorrect application of the correct central line" by the rank-and-file cadres. As a result, the latter were demoralised, clearly realising the contradiction between the official line and practice. Since their faith in the directions from the centre was shaken, they lost their bearings. The results of the “great leap forward" policy damaged the prestige of those who had taken part in elaborating it. Since these men remained in their posts, it was also very hard to redress the mistakes of the “great leap forward" or find a way out of the critical situation.

p The “great leap forward" policy had an effect on social activity in China, both political and economic. Initially, the 161 masses became much more active in broad movements, first in agriculture and then in industry. It would be wrong to think, however, that their vigour was forced: no kind of enforcement methods could have invested the massive activity in 1958 with so much scope, enthusiasm and self-denial. It seemed to have been largely voluntary and at the same time spontaneous, and did not involve any growth of political consciousness. It was due to the attractive prospect of a rich and happy future that was virtually round the corner. The “great leap forward" was to take three years (an unrealistic period), but the people hoped that the results would show instantly, rather than at the end of the three years. This applied, above all, to the countryside, where a great deal of effort was being put in. The people no longer wanted to hold themselves in check and wait for a new life for several more years. As soon as their hopes failed to materialise, their vigour rapidly gave out, especially during the critical period towards the end of the “great leap forward”. The masses’ loss of faith in the possibility of a better future (and any policy promising such a future) subsequently made them even more passive. This effect of the “great leap forward" policy subsequently did much harm, hampering later efforts to rally afresh the hundreds of millions of Chinese working people, particularly the peasants, whom it had been so hard to involve in political work during the civil war, the agrarian reform and the early stages of co-operation. Hence one of the gravest problems of China’s present-day political and economic life.

Since the failure of the “great leap forward" experiment, the CPC’s Maoist leadership has been unable to work out any positive economic policy. It has sought to whip up the notorious threat from outside so as to obscure the fact that the domestic problems of socialist construction in China have not been solved, and that it was unable to meet the population’s economic needs. The Maoist leadership has stayed in power by using various methods to stamp out the slightest opposition, the most vivid of these methods being “the great proletarian cultural revolution of the recent period”.