Rebirth: I am in Jin-Cha-Ji

Good writing is everything. As long as your writing is good, you can get into college no matter how bad your math grades are.

In the Republic of China, university admissions were entirely independent, giving schools absolute authority. Consequently, there were few university students in the country; all went to liberal arts. Just look at how talent is lacking in New China today. Even after years of promoting economic accounting, the situation remains far from optimistic.

The accounts of various departments and factories are still in chaos.

Including the original file organization of various departments, there are problems everywhere.

"We must further improve the economic accounting capabilities of all departments and factories. We must prioritize this area in higher education and secondary vocational education. At the same time, we must strengthen training for economic accounting units. If many departments and factories could improve their economic accounting, the cost reductions would be significant."

“Economic accounting is one of the core elements of production.”

The chairman nodded.

During his last visit to rural Henan, the Chairman vividly recounted the headaches faced by cooperative cadres due to a lack of qualified accountants. Even small cooperatives with only a few thousand households have been forced to withdraw due to accounting issues. Government departments and many factories manage funds amounting to millions or even tens of millions. How can they survive without accounting?

The Chairman initially had no idea that economic accounting would become so important. In fact, historically, China only really began to attach importance to economic accounting during the First Five-Year Plan, when everyone from top to bottom was in a state of panic.

Soviet experts had advised the Chinese government several times before, but no one took it to heart. However, in this era, economic accounting has been a priority since the founding of the People's Republic of China. However, despite this emphasis, the foundation was too shallow, and achieving true economic independence in a short period of time was impossible.

Therefore, it is necessary to strengthen talent training in this area.

"The fourth aspect is the problem of the rural market. Our current unified purchase and marketing system has suppressed the development of the rural market, directly affecting fiscal revenue and the circulation of agricultural and sideline products in rural towns and villages."

"Tell me more specifically."

"Three serious problems have arisen since the implementation of unified purchase and sale of rural agricultural and sideline products. First, it has increased the difficulty and cost of unified purchase and sale. There are too many varieties of agricultural and sideline products. There are dozens or even hundreds of different kinds of vegetables and wild vegetables alone. These vegetables and wild vegetables ripen at different times. We have to make multiple trips to purchase them, which costs us too much. In the end, we not only make no profit from the purchase and sale process, but actually suffer losses."

"Because there are so many different types of agricultural and sideline products, apart from the fixed purchase prices set by the state for some major agricultural and sideline products, the purchase prices of other agricultural and sideline products are flexibly controlled by local supply and marketing cooperatives. To reduce costs and increase profits, they choose to lower the purchase prices of clothing and sideline products and increase the retail prices of agricultural and sideline products."

"After the unified purchase and marketing system was implemented, our state-owned businesses were the only ones doing business in rural areas, with a sense of monopoly. Supply and marketing cooperatives and commercial companies, as state-owned enterprises, were both government and business, possessing both administrative and economic power. Faced with such institutions, ordinary people had no way to cope. They could only accept the supply and marketing cooperatives and commercial companies driving down the prices of agricultural and sideline products. This result greatly dampened the enthusiasm of rural residents for agricultural and sideline product production."

"In the unified purchase and sale of rural agricultural and sideline products, the supply and marketing cooperatives not only failed to generate profits for the state, but instead caused great dissatisfaction among rural cooperative members. At the same time, the increase in sales prices also caused complaints from urban residents."

Mao Zemin's words made the Chairman's expression serious.

In fact, after the unified purchase and marketing system was implemented, central leadership quickly discovered some of the problems. This included the Chairman. The Ministry of Rural Affairs also wrote a report on the issue. Supply and marketing cooperatives often engaged in price-cutting when purchasing from farmers, purchasing agricultural and sideline products at low prices and then raising them when selling. This, of course, was also related to their high operating costs.

The purpose of unified purchase and sale was originally to control the shortage of supplies so that everyone could have a certain amount. Because the current supply of supplies nationwide is only enough to fill everyone's stomachs, not to fill their bellies, this is why supply control is necessary.

At the same time, profits are obtained from acquisitions and sales to provide funds for national industrialization.

But what Mao Zemin said was very simple.

The current situation is that the supply and marketing cooperatives are being criticized by both sides for purchasing agricultural and sideline products from rural areas. They are criticized by rural farmers and urban residents. Moreover, they are unable to generate profits and provide funds to the state.

"Secondly, there is serious waste. Many agricultural and sideline products, especially vegetables, are damaged due to improper storage. This is not only due to negligence by supply and marketing cooperative staff, but also to transportation and storage issues, as well as a lack of staff in the supply and marketing cooperatives. The supply and marketing cooperatives previously handled too many items and too many details to carefully care for and preserve these agricultural and sideline products. This waste of agricultural and sideline products by the supply and marketing cooperatives has led to significant price fluctuations in urban areas, creating a significant conflict with my country's price control."

Socialist countries attach particular importance to price stability.

During the Republican era and the early years of the People's Republic of China, the Chinese people experienced severe inflation and price increases. At their worst, prices rose thousands or even tens of thousands of times in a single year. Therefore, the Chinese people are now very sensitive to prices.

Any price fluctuation will cause market fluctuations, but this is exactly the case with agricultural and sideline products.

Vegetables certainly need to be fresh. But after the unified purchase and marketing system was implemented, rural cooperatives were unwilling to cooperate with supply and marketing cooperatives on vegetable issues. Even if they did cooperate, they wouldn't deliver them to you.

Because the price is too low.

Moreover, there are too many varieties of vegetables, and the supply and marketing cooperatives cannot distinguish many of them. Even the staff of the supply and marketing cooperatives cannot recognize many vegetables.

Therefore, it is easy for vegetables to be damaged during storage, transportation, care, and finally sale. In order to compensate for these losses, the vegetable prices of supply and marketing cooperatives are also very volatile.

Prices even change daily.

This was unacceptable to many urban residents. Furthermore, price fluctuations in agricultural and sideline products from supply and marketing cooperatives directly affected other items whose prices remained unchanged. Many people feared that food prices would also fluctuate.

This conflicts with the country's major policy of stabilizing prices.

"Third, precisely because rural cooperatives distrust the supply and marketing cooperatives and are unwilling to cooperate with them, they often conceal information about vegetable production and other agricultural and sideline products. If this underreporting were to spread, it wouldn't just affect these agricultural and sideline products. It would also affect the production of grain, oil, and live pigs, essential agricultural and sideline products for the country. They would continue to conceal their production in order to defy the state's unified purchase and marketing policy. This is the most terrifying thing."

Public ownership and collective ownership.

Public ownership refers to the current state-owned economy. This is state-controlled, so the state can control most of it. However, the collective economy, including rural cooperatives like the Yicun Cooperative, while also part of socialism, is different.

Since it is a collective economy, there must be a specific collective.

In a rural cooperative, the collective is the village. If a factory is established in a county, it belongs to the county collective, and the collective is the county itself. Therefore, the first consideration of the collective economy is undoubtedly the collective's interests.

You can't ask the collective economy to give up its own collective interests to consider other collectives or the interests of the country. There aren't that many selfless people.

This is the case with rural cooperatives.

Under the unified purchase and sale system, it is the interests of the rural collective that are harmed.

In particular, many agricultural and sideline products lack nationally guided prices; local supply and marketing cooperatives set their own prices. These cooperatives have been suppressing prices for rural agricultural and sideline products, leading to a sharp increase in conflicts between the rural cooperatives and the supply and marketing cooperatives. Compared to the unified purchase and sale of grain, oil, and live pigs, the unified purchase and sale of agricultural and sideline products is not particularly strict. Therefore, on this issue, the rural cooperatives began to conceal their production and began to confront the supply and marketing cooperatives.

But if this continues for a period of time.

Once rural cooperatives see that they can protect their own interests in this way, they will begin to play tricks on the supply and marketing cooperatives in areas such as grain, live pigs, and grain and oil. This will directly affect the national unified purchase and marketing strategy.

So this is a very dangerous tendency.

Because for a long time, national industrialization required the profits brought by unified purchase and marketing.

Therefore, the problem of agricultural and sideline products must be solved.

Mao Zemin didn't care whether everyone's faces were grim or not. He continued, "It can be said that the unified purchase and sale of agricultural and sideline products has now encountered very serious problems. Not only has it failed to achieve the results the country desired, but it has also affected the development of the rural economy, the living needs of urban residents, and increased conflicts between rural cooperatives and supply and marketing cooperatives."

"I've done the math with many people. Based on my country's current agricultural and sideline product output and the proportion of these products that have previously entered the market, this market could reach at least 120 billion yuan. Farm-grown products account for approximately 80 billion yuan of this, while other handmade products, such as small commodities like benches and basins, account for 40 billion yuan. And this only captures urban residents' purchases of agricultural and sideline products. If we include inter-village sales of agricultural and sideline products, the annual market size could be close to 180 billion yuan. If we can effectively develop this market, rural incomes will increase, urban residents' needs will be met, and the government could generate approximately 10 billion yuan in tax revenue."

"Since we began wage reform in 1952, the purchasing power of urban residents has greatly increased. Currently, the situation in urban areas is one of money but limited goods. Many families have incomes but cannot afford the goods they need. Agricultural and sideline products are essential to daily life, and urban residents have a strong appetite for them. Therefore, if we can stimulate the production enthusiasm of rural cooperatives, agricultural and sideline product output will increase, and the market for agricultural and sideline products will continue to expand."

After Mao Zemin finished speaking, everyone was digesting it.

China is poor, but that's because it has a large population, currently over 6.5 million. The same is true for rural areas. While poverty may seem extreme, there are still over million farmers. If each person spends a few more dollars a year, that's a multi-billion dollar market.

After a while, Chen Yun spoke up, "I think Comrade Mao Zemin's way of life makes perfect sense. After the socialist transformation of industry and commerce and the implementation of unified purchase and marketing, the free markets in both urban and rural areas shrank rapidly, leading to the demise of the free economy. The result was exactly as Comrade Mao Zemin had said. First, the supply and marketing cooperatives exploited their monopoly position, intentionally or unintentionally infringing on the interests of farmers in the purchase and marketing process; second, farmers' non-plant production and operations were severely restricted; and third, rural commercial circulation was obstructed, causing inconvenience to farmers' production and life, which in turn affected the living needs of urban residents."

"Current market management methods restrict private traders' purchasing and trafficking. These market management methods effectively result in agricultural products and agricultural by-products being exclusively purchased by local supply and marketing cooperatives or state-owned commercial enterprises, with no competition from other purchasing units. Therefore, when supply and marketing cooperatives and state-owned commercial enterprises fail to purchase certain agricultural products and agricultural by-products or charge low prices, this discourages farmers from producing, leading to a reduction in the production of these agricultural products and agricultural by-products. This is an inevitable problem."

"The current overly strict market management practices, which are prevalent in most markets, from large cities to small towns, have resulted in increased management costs, transportation costs, and storage costs. Ultimately, supply and marketing cooperatives and commercial companies are not only unable to generate profits, but have also disrupted the normal market and undermined the agricultural and sideline product market in my country."

The Chairman asked: "Comrade Chen Yun, how do you think we should adjust?" In terms of economy, the Chairman still trusted Chen Yun very much.

Chen Yundao said: "Capitalist production is anarchic and irrational on a large scale, but the free market is still rational on a small scale. Socialist production is rational on a large scale, but still irrational on a small scale. We must achieve both rationality on a large scale and rationality on a small scale. To achieve this, we must establish a free market within the planned economy on a socialist basis."

Chen Yun also thought about this aspect for a long time.

Because Chen Yun was in charge of the national economy, the unified purchase and marketing policy began in 1951, and the socialist transformation of industry and commerce began in 1952. Soon after, problems began to arise in the economy at the lower levels.

It's mainly a question of activity.

Since Mao Zemin had already raised the point, Chen Yun simply offered his own perspective. He stated directly: "After the socialist transformation of industry and commerce and the implementation of unified purchase and marketing, we only have a state market, not a free market. This is why so many problems have arisen. We need both a state market and a free market under the leadership of the state market. Without this free market, the market will become stagnant. This free market is different from the free market of capitalist countries because it is not a blind market, but rather an auxiliary market to the state market."

"No matter how big or small, planning is necessary for everything. Individual production is a supplement to collective ownership. This free market only accounts for 1952 percent; percent is state-monopolized. Without this first percent of freedom, the economy would be completely ruined. Therefore, this percent of freedom is essential. Now, we must restore the pre- situation on the basis of a socialist economy. We cannot do this completely. We should have planning in the big picture and freedom in the small. In this way, within the socialist unified market, the state-owned cranes will be the main body, but there will also be a limited range of state-led private markets."

"For some commodities, we will adopt the policy of selective purchase and self-sale, allowing many small factories to produce independently; dividing many handicraft cooperatives into smaller groups or households; allowing many sideline products to be operated individually by members of agricultural cooperatives; relaxing market management of small local products; not fearing temporary price increases of some commodities within a certain range; and changing the planned management methods of certain sectors. These are not capitalist free markets, but socialist markets suited to my country's conditions and the needs of the people. These free markets are under state leadership and serve as a supplement to the state market. As such, they are an integral part of the unified socialist market."

Chen Yun finally spoke out what he had been thinking about these days: planned economy, market economy.

This is a topic that's discussed quite a bit. The prevailing view is that socialism is a planned economy, while capitalism is a market economy. While this isn't absolute, it's the prevailing view.

Chen Yunyun was the first among the first generation of core leaders to propose the development of a free market in China's socialist economy.

All those present here are important leaders of the central government.

It's not surprising to hear Chen Yun say these words. The call for developing a free market has been uninterrupted since the founding of the People's Republic of China. The Ta Kung Pao has been making this suggestion annually since 1948. It's just that this time, coming from Chen Yun, a member of the Politburo Standing Committee, it carries a completely different weight.

After a while, Comrade Xiuyang spoke up, "I think what Comrade Chen Yun said makes a lot of sense. Social and economic activities are so diverse, there are thousands, even tens of thousands of them, and it's impossible for a plan to effectively manage them all. Socialist planned economies can only be large-scale, and it's impossible to cover every aspect. On the contrary, planned economies cannot match the free market in terms of flexibility and diversity."

"How can we make our socialist economy possess these characteristics simultaneously: planning, diversity, and flexibility? This requires the use of the free market. On the one hand, the free market can supplement the shortcomings of our current socialist economy; on the other hand, it can help us achieve economic diversity and flexibility."

"The free market needs to develop, but there should be some restrictions and adjustments. Restrictions mean administrative restrictions. There are two ways to adjust: First, wherever private individuals are making money, we should follow their example. If they carry one load, we should carry one load; if they carry two loads, we should carry two loads. We currently have a superstitious belief: 'Because I am a socialist, I am more advanced than private capitalism.' This superstitious thinking is unacceptable and must be eliminated. In fact, socialism lags behind private capitalism in some respects. The second method is taxation. We should use taxation to adjust the income of capitalists."

Comrade Xiu Yang and Comrade Chen Yun are both current members of the Political Bureau Standing Committee.

This is a relatively clear political line on the economic front, much like the Chairman saying that current Sino-foreign joint ventures are governed by the government, supervised by workers, and guided by the socialist economy, and therefore can be considered part of the socialist economy.

Comrade Xiuyang and Comrade Chen Yun's opinion is that the free market is under the leadership of the planned economy and is also part of the socialist economy.

The Chairman has been thinking.

The Chairman did not quite agree with this issue.

It's easy for a few companies, as components of a socialist economy, to participate in the socialist economic system. After all, they're just factories, and the economic system they operate in is socialist. However, the fundamental nature of a free market with private competition is capitalist.

But as things stand now, the national market is clearly flawed.

Mao Zedong clearly defined the flaw. Therefore, other solutions are necessary. The free market is the simplest and easiest approach. Since we can't control so much, let them go and let them do whatever they want.

But the Chairman always felt that there was a problem, but he had not yet found a more appropriate solution.

Gao Gang disagreed.

He said, "I think opening up the free market is completely unacceptable. The free market itself is a capitalist market. No matter how much it's packaged, it's still a capitalist market. Once the free market is opened up, it will inevitably lead to a new round of wealth disparity and the birth of new capitalists. This is beyond doubt. This is because capitalists are more familiar with the market than ordinary people and have a more sensitive nose for market reactions. As long as the free market is opened up, they will immediately become new capitalists again. So what is the purpose of our socialist transformation of industry and commerce?"

"Comrade Gao Gang, I've said before. We can impose restrictions and then make adjustments to prevent the emergence of big capitalists."

Comrade Xiuyang explained to Gao Gang.

However, Gao Gang said directly: "Even if we prevent the emergence of big capitalists, small and medium-sized capitalists will still appear. Now our country is concentrating its efforts on industrialization. Our rural areas only keep seeds and enough food to feed the people, and the rest is handed over to the state. Our workers have been producing for free for months, just for the sake of national industrialization. In order to raise funds for industrialization, at the last Politburo meeting, thousands of government departments and military personnel across the country cut their salaries. At this moment when the whole country is united, if small and medium-sized capitalists appear again, then why should we ask our workers and peasants to suffer together for the national industrialization? Why should those small and medium-sized capitalists get rich while our workers and peasants have to work hard?"

"Comrade Gao Gang, we need to solve the problem now instead of shouting slogans." Peng Zhen criticized Gao Gang.

I think it doesn't solve the problem and is just shouting slogans.

Gao Gang became even more angry and said, "Comrade Peng Zhen, as a member of the Politburo Standing Committee, don't I have the power to raise objections?

"Comrade Gao Gang, Comrade Peng Zhen didn't mean that." Comrade Xiuyang quickly calmed Gao Gang down.

This is a firecracker.

Click it and it will explode.

Wei Hongjun then spoke up, "I think our economy is currently being overly controlled. As Comrade Xiuyang said, there are so many different types of social and economic activities, tens of thousands, dozens of them. With our current capabilities, it's impossible to manage and plan for everything. Since we can't plan for everything, we must prioritize the big and let go of the small. The state should focus on key projects and the nation's vital industries. As for the many areas we can't cater to, we must give them flexibility."

"But I'm against directly liberalizing the free market. It's not because I'm against the free market. In fact, a free market under state economic leadership is a very good idea. I've recently been studying materials on Roosevelt's New Deal during the Great Depression of 1929, as well as books by Keynes. Roosevelt's New Deal included a significant amount of state-planned economics. Does this mean that the Roosevelt administration's extensive use of planned economics is socialism? Of course not. The same goes for the free market. Capitalism has developed for hundreds of years and has experienced many crises, so it's constantly adjusting. While the fundamental contradictions of the capitalist free market cannot be resolved, its free market still has many advantages and has many lessons worth learning from. Does imitating some of the advantages of their free market mean that we socialists will become capitalists? Of course not."

"I believe the biggest fundamental difference between socialism and capitalism isn't whether there's a free market within a planned economy, or a planned economy within a free market. It depends on two key points: whether a socialist planned economy or a capitalist free market dominates. The other is who controls the means of production. If the means of production are controlled by private capitalists, then regardless of whether it's a planned economy or a free market, it's capitalism. If the means of production are controlled by the entire population, in collective hands, then a planned economy with a free market is also socialism."

"But why do I oppose directly opening up the free market? It's because our country is currently facing a shortage of supplies and an unstable market. If we open up the free market amidst a shortage of supplies, then a prosperous free market will only lead to speculation, not economic prosperity."

"The rich peasants and landlords in the rural cooperatives have experience in this area. If we arbitrarily open up the free market, they will take advantage of the uncertainty of supplies to speculate. Once they make a profit, they will choose to withdraw from the rural cooperatives. If they make money in the free market, what will the other cooperative members think? Just a few years after liberation, the rich peasants and landlords have taken advantage of the changes in national policies to become rich again. This will not only cause dissatisfaction among rural farmers, but also cause unrest in the cooperatives and lead to withdrawal from the cooperatives. If this happens to the rural cooperatives, how can the state's unified purchase and marketing be carried out? If the rural cooperative economy collapses, it will affect the development of urban industrialization."

"A free market must be established, but it cannot be liberalized without any steps or management, under the pretext that the free market is under the leadership of the socialist economy. Such a result would greatly disrupt the national economy, disrupt the country's industrialization process, and even more so disrupt the rural cooperative economy that has just begun to develop."

Wei Hongjun had to speak up.

The free market is not a rare thing.