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How successful were Mao's economic policies?

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by

Aris Alexiadis

on 12 February 2014

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Transcript of How successful were Mao's economic policies?

Failures of Economic Policies
The Great Leap Forward caused the Great Chinese Famine
The years 1958 through 1962 were the only between 1953 and 1985 in which China's economy shrank
"enormous amounts of investment produced only modest increases in production or none at all. ... In short, the Great Leap was a very expensive disaster." - Dwight Perkins

How successful were Mao's economic policies?
Return to Marxist Orthodoxy
Mao announced in 1949 that although the revolution had followed the unorthodox path of 'encircling the cities from the countryside,' it would now take the orthodox road of the cities leading and guiding the countryside

Agreed with Liu Shaoqi in 1950 that collectivization would only be possible when China's heavy industry had provided the necessary equipment for mechanization
The Agrarian Reform Law 1950

Feudal services and forced labour were abolished
Cadres were trained and dispersed throughout the countryside
Supervised setting up of local peasant associations and militias
Landlords had to refund rent deposits
Class status of villagers was identified
Creation of 'Speak Bitterness Meetings'
Property of rich landowners was divided up by the peasantry
dispossessed landlords were given a share of land 'to redeem themselves through work

Generally the position of the peasants improved:
The peasants gained self confidence
Agricultural productivity increased
Industry
Transportation
Army repaired and extended the railway system
Roads and canal ere repaired and extended
Trade unions organized to convert workers to the state points of view
State Planning Commission (1952) led to increased bureaucratization and centralization
State in charge of price controls, allocation of natural resources
Foreign control was evicted
The Five-year Plan (1955)
10,000 Soviet and East European experts assisted
The masses encouraged to compete with each other
Main effort to be directed at:
at the undeveloped interior of the country
at heavy industry
at large-scale projects
"Transition to Socialism"
The Agrarian reform law left many peasants with plots that were too small and without proper equipment

In the 1950s, 'mutual aid' teams of poor peasants formed to create cooperatives

By 1956 about 95% of peasants were in cooperatives of 100-300 families
The Economy
Mao wished to control capitalism
Five legitimate sectors were recognized
State enterprises- confiscated from:
The landlords
the GMD
the Japanese
Private enterprises owned by "national capitalists"
State capitalist enterprises, owned in part by the state and in part by the national capitalists
Co-operatives
Small individual businesses
Through these 5-year plans, only the state could co-ordinate all activities
Loss of independence
Finance & Commerce
Banks were nationalized
Inflation was brought under control in 1950 by the People's bank
State budget was balanced
Wholesale trade passed under state control
Commercial co-operatives were set up, which undercut private retail trade
The Great Leap Forward
The term Mao used to describe the second five-year plan of 1958-62
The aim was to rapidly transform the country from a backwards agrarian economy into a communist society through rapid industrialization and collectivization
The main change was the introduction of mandatory agricultural collectivization in the form of 'people's communes'
Private farming was prohibited and any who engaged in it were labeled counter-revolutionaries
The death toll from the Great Leap Forward was 18 to 45 million people
"coercion, terror, and systematic violence were the very foundation of the Great Leap Forward" - Frank Dikotter
Agriculture
Successes of Mao's Economic Policies
Half of China became irrigated
Industrial output increased by 1300%
Railway network doubled
Dramatic increase in literacy rates
Near universal healthcare introduced
Life expectancy rose
Thanks to the first year plan industry was beginning to produce enough capital that the USSR's support was no longer necessary
The Situation in 1949
The civil war had caused some economic problems:
Low levels of gross domestic product
high rates of inflation
high levels of urban unemployment
food shortages and high prices
Tackling Corruption
The three-anti campaign of 1951 aimed to get rid of: corruption, waste and bureaucracy

The Five-anti campaign of 1952 tackled: bribery, theft of state property, tax evasion, cheating on government contracts and stealing state economic information

Mao evaluated the situation, saying that "We must probably execute 10,000 to several tens of thousands of embezzlers nationwide before we can solve the problem."
Conclusion
While Mao's economic policy was initially successful, the immense failure of the Great Leap Forward, which actually worsened the economy, proves that his policies, overall, were failure
By Ben & Aris
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