Communist China's Economy, 1949-1962: Structural Changes and Crisis

By Cheng Chu-Yuan | Go to book overview

CHAPTER 10
CONCLUSION

The structural changes in the Chinese economy during the first thirteen years of communist control have brought about a state monopoly which has allowed the communist regime to conduct its industrialization program with unprecedented speed. The increase of heavy industrial productivity is impressive and the facilities of communication have been greatly expanded. However, at the same time, the deterioration of agriculture and the subsequent emergence of great famine have offset in part these industrial achievements.

Considering the whole process of economic transformation, the Chinese Communists have been very successful in terms of eliminating the middle class and in transforming private industry and commerce into state capitalism. Within a short span of six years ( 1952-57), the three million capitalists and petty-bourgeoisie in the urban districts were completely absorbed into the state sector without causing any chaotic disturbance to production. Private assets, totaling U.S. $10 billion were turned into state property, and a symbolic "fixed interest" of about U.S. $50 million was ordered to be paid annually for ten years ( 1956-65) as compensation to the Chinese capitalists for surrender of their assets. This compensation is, in fact, no different from confiscation. The compromising character of the Chinese middle class and their incompetence in forming any real resistance were important reasons for this communist victory. A more important factor was the skillful manipulation of Communist strategy toward the capitalists and the regime's technique for gaining control by different stages.

The collectivization of agriculture succeeded in the period of land reform. By employing Dr. Sun Yet-sen's famous slogan "land to the tillers", the regime successfully prodded poor farmers to struggle against the landlord class as a whole. But the government encountered great difficulties in the latter stage of co-operativization when the peasants again lost their lands. The collective program of the sevenyears from 1955 to 1961 dealt heavy blows to the initiative of the individual farmer.

From the economic point of view, Chinese Communist leaders had committed a vital mistake in their basic policy orientation. Should China have followed the Japanese example, instead of tracing Russian foot-steps, the economic condition of China today would be completely different. Russia possesses about 1.5 times more arable

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Communist China's Economy, 1949-1962: Structural Changes and Crisis
Table of contents

Table of contents

  • Title Page i
  • Foreword iii
  • Preface v
  • Contents vii
  • List of Tables ix
  • Other Books by the Same Author xi
  • Abbreviations xii
  • Chapter 1 Introduction 1
  • References 3
  • Chapter 2 Major Features of China's Pre-Communist Economic Structure 4
  • References 9
  • Chapter 3 Chinese Communist Theories and Policies for Economic Structural Transformation 11
  • References 19
  • Chapter 4 Agricultural Collectivizsation 22
  • References 56
  • Chapter 5 Transformation of the Private Sector into the State-Operated Sector 60
  • References 82
  • Chapter 6 Establishment of the Central Planning Machinery and State Monopoly 84
  • References 104
  • Chapter 7 Basic Changes in the Component of the National Product 106
  • Chapter 8 Famine and Crisis 128
  • References 153
  • Chapter 9 Significance and Prospects 157
  • References 172
  • Chapter 10 Conclusion 175
  • Appendix a Note on Communist China's Statistical Data 181
  • References 189
  • Appendix II Conversion Tables 191
  • Selected Bibliography 194
  • Index 208
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