The Progress Industrialization in China

In 1949, Mao Zedong established the Communist Peoples Party that tries to solve China’s problem of land distribution and poverty. Mao changed China's social and political order. Before 1949, China was a divided country with no national identity and pride, this limited progress. Mao instilled a strong sense of nationalism in the population through collectivization to increase the rate of industrialization. Mao’s insistence on industrialization created an industrial base and infrastructure for China's economic development (Eckstein, 1977). Schwartz found that industrialization requires a change in the social and political infrastructure (2010, 83). Gerschenkron found patterns that the later a country industrialized the more concentration on the state to build enfant industries through protection tariffs and subsidized to allow them to establish themselves (2010, 80). Schwartz argues that successful industrializers have a strong and autonomous state that is separate from agrarian elites (2010, 256). Schwartz also states that the later a country industrializes the greater danger that the process of industrialization destroys agriculture and it can no longer produce ongoing capital to the industrial sector (2010, 88). This is clearly seen throughout the process of industrialization in China.

Alexander Eckstein’s article focused on the policy shifts in different periods to trace the development of China's economy. 1949 to 1952 was the recovery and rehabilitation period, where an emphasis was placed on establishing economic order and stability (Eckstein, 1977, 196). This period was a Soviet-style development strategy supported by Soviet assistance, and based on centralized planning. Eckstein argues that during this period the CPC was able to recover industrial plants, agricultural productivity and slowly restore price stability (1977, 197). The new regime was able to restore destroyed factories and railroad in order to produce and transport goods throughout the country. Top priority of investment allocation was heavy industry (1977, 196). During this period the regime also established institutions that allowed the state to control resource mobilization and allocation (1977, 197). China's agriculture and rural development is important to the goal of industrialization. During the beginning of the 1950s, China undertook a Soviet-style development that emphasized heavy industry, which reduced the centrality of agriculture and rural development (Johnson, 1979, 606). Pre-1949, China's greatest issue was that there were too many people and not enough land to produce food to sustain them, therefore most peasants were malnourished and had poor health and education; rural China was characterized by poverty (Johnson, 1979, 607). In 1949 Mao's communist Party wanted to transform China's rural economy through a reorganization of the rural region and a socialist transformation of agriculture and industry (Johnson, 1979, 608). For the process of industrialization, Mao first had to eliminate the feudal land system of China. Prior to land reforms, landlords and elite classes directly or indirectly exploited the peasants (Dong, 2014, 473).

The first phase of the development of the rural economy was land reforms. Land reforms gave peasants access to land and destroyed the power of landlords and rural elites; the traditional self-rule system of villages were destroyed (Johnson, 1979, 609). Rural elites and landlords were replaced by a new leadership that was loyal to the Chinese Communist Party; this established the CPC's legitimacy in the rural regions (Liu, 734). Yu Liu compares and contrasts the 'high tide' of collectivization in China and the Soviet Union. In contrast, land reforms in the Soviet Union did not completely destroy traditional social relations (Liu, 2006, 733). The traditional mirs (peasant land communes) maintained authority and the self-rule system in rural regions through managing levies and leasing land (Liu, 2006, 734). The Soviet Union also didn’t redistribute land to the peasants in order to establish legitimacy in the region (Liu, 2006, 734). In China the Party created a divide between upper-middle peasants and lower-middle peasants to mobilize the majority of peasants to join collectivization (Liu, 2006, 736). The rural Party leadership provided an organizational infrastructure that effectively enforced collectivization (Liu, 2006, 739).

Dong argues that land reforms allowed China to develop because it 'laid down the base for national promotion of industrialization, and transformed social resources of traditional community to industrialized social capital... The land reforms guaranteed the continuity of national industrialization and social stability' (Dong, 2014, 474). For economic development Mao wanted to build a self-sufficient industrial sector, where heavy industry would be the key for economic development. Surplus generated from agriculture would be used to develop the leading factor of industry. In order for the state to control the flow of agricultural surplus to industry and to increase productivity Mao established rural cooperatives and communes (Dong, 2014, 475).

However, the main goal was to increase production and revive the stagnant rural economy, this required cooperation of individual households. It was a political task to encourage cooperation between peasant households for an economic transformation (Johnson, 1979, 609). In the early 1950s, cooperation through mutual aid teams was encouraged to deal with the problem of labour shortages, this wasn’t effective enough (Johnson, 1979, 610). They wanted to secure permanent organized units; agricultural cooperatives (Johnson, 1979, 610). This didn’t have the best start as a result of the nature of rural administration, where rich peasant dominated the villages (Johnson, 1979, 610). There were also problems with the 1954 harvest, where the States new grain purchasing system led to hostility from the peasants, and difficulties for local level leaders (Johnston, 1979, 610). 1955 began the mass mobilization strategy, where Mao began fundamental efforts in the rural regions to organize and mobilize the peasants into permanent agricultural cooperatives (collectives) (Johnson, 1797, 610). With the new cooperatives which were rooted organization in the villages, Mao's movement was given a strong social base, the peasants (Johnson, 1979, 611). In the new cooperatives peasant owned the land, production was done collectively and income was distributed on collective principles (Johnson, 1979, 611). This political advancement, the reorganization of the rural economy, was important to China's later development. The organization transformations changed the production relations in rural China, this laid the foundation for the technical transformation of agriculture (Johnson, 1979, 615).

In 1953 the new regime revealed their First Five Year Plan, to drive China to industrialization. The CPC established a Soviet-style economic model of development that created the First Five Year Plan from 1953-57. The Soviet industrialization model however, did not work in China's agrarian society. Industrial production grew but agricultural output slowed down. Eckstein suggests that the first Five Year Plan created the infrastructure and industrial base that would play an important role in China's economic growth in the post-Mao period (1977, 199). The bad performance of agriculture threatened the industrial sector and China’s development as a whole (Eckstein, 1977, 200). The agricultural sector produced surpluses used to provide capital and investments for the industrial sector. The industrialization of communes allowed for the creation of town enterprises, widespread primary education, and construction of irrigation works, medical services and the social environment of industrialization (Dong, 2014, 475). Mao wanted to increase the investment in agriculture and light industry in order to develop heavy industry with a solid foundation because in increasing investment to agriculture guarantees peoples livelihood (Dong, 2014, 484).

Schwartz (2010) states that late industrializing countries also rely on developing advanced scientific technology to catch up to industrialized countries. Mao with the help of Soviet Union experts and technicians established a planned economic system and laid the foundations for an industrial system during the First Five Year Plan (Dong, 2014, 476). Mao wanted to introduce equipment and technology from the Soviet Union to first imitate it , then to improve and modify it to China's needs (Dong, 2014, 476).In order to increase production Mao wanted to develop science and technology. In 1955, China started new scientific and technological industries, including nuclear technology, computer technology and automation technology (Dong, 2014, 477). During the First Five Year Plan, investment of economic development was controlled by the central government (Dong, 2014, 478). Centralization of the government created lack of flexibility and rigid control of state owned enterprises and local government finance (Dong, 2014, 478). In the beginning of industrialization the Chinese government used surplus from agriculture to provide capital to heavy industry, but the centralization of government caused problems (Dong, 2014, 479). As a result, in 1958 Mao gave more management power to enterprises, but the results weren’t good (Dong, 2014, 479). Decentralization in the Great Leap Forward led to the collapse of planning which lead to famine and death.

The Soviet-style industrialization model was unable to modernize agriculture, so the regime replaced it with a new strategy where agriculture and industry were given equal priority; for Mao modernizing agriculture is just as important as modernizing industry (Eckstein, 1977, 201). The Second Five Year Plan was announced in 1958 to 1962 to increase the growth of the agricultural sector while also increasing industrialization (Eckstein, 1977, 201). The industrial sector adopted capital intensive techniques and the agricultural sector adopted labour intensive techniques. The early stages of the Second FYP were successful; however, success was short-lived due to Mao's Great Leap Forward.

Mao’s Great Leap Forward wanted to balance growth in industry and agriculture and to achieve economic development through mass mobilization of labour (Eckstein, 1977, 55). The GLF was an attempt to overcome the problems of lagging agricultural productivity (Eckstein, 1977, 55). Eckstein argues that a real long term plan for industrialization was not established until 1955.The Great Leap Forward intensified investments to heavy industry (1977, 56). It marked a move from centralized government to a decentralized mode of operation; in industry to the factory level, in agriculture the communes where the new production units. The Great Leap Forward's attempt to force economic development led to consequences of famine and economic setbacks (Eckstein, 1977, 58).

Hiniker and Farace’s article focuses on the styles and strategies of development in China between 1949 and 1958. They argue that two different strategies of development where established by the Mao's communist regime; the Soviet-style of technical bureaucratization and the Maoist model of mass mobilization. The two strategies took place simultaneously; but from 1950-1955 technical bureaucratization was dominant and from 1955-60 mass mobilization strategy was dominant (Hiniker Farace, 1969). In comparing 1928 Russia and 1952 China, China had a lower level of development, fewer natural resources and a greater population (Hiniker Farace, 53). Russia offered a good communist model of development, but the economic disparities between the two countries forced China to alter the Soviet-style of development (Hiniker Farace, 53). Technical bureaucratization is a model of development by elite rule through a central bureaucracy of specialists (Hiniker Farace, 57). The goal is material growth organized by the central government through technical planning (Hiniker Farace, 57). The bureaucracy is made up of trained specialists who are responsible for economic development (Hiniker Farace, 57). The bureaucracy style of production was capital intensive (Hiniker Farace, 58). The Soviet-style development strategy also included the nationalization of the means of production, collectivization of agriculture and the subordination of the agricultural sector to the needs of the heavy industry sector (Hiniker Farace, 58). Mao learned from the consequences suffered by the Soviet Union that agricultural production must be increased, therefore collectivization would lead to an increase in production. Mass mobilization is a model of development by decentralized local groups loyal to the regime leader (Hiniker Farace, 58).

The goal is the transformation of China into a classless society of proletarians (Hiniker Farace, 58). The development plan was organized by decentralized groups who were able to be close to the working masses through their location in units of production (Hiniker Farace, 58). Economic development depended on unleashing the power of the masses to work for the collective interest for wide scale production (Hiniker Farace, 58). It is a labour intensive style of development. Hiniker and Farace argued that the CPC started to industrialize based on a 'revolution from above' Soviet-style model; however, their original ideals were being tainted by the formation of a bureaucratic specialist class that was similar to what they overthrew (1969, 71). To counter this, Mao established a 'revolution from below', the Great Leap Forward model of development to achieve industrialization and mass mobilization, but this failed (Hiniker Farace, 71). The authors argue that industrialization requires at certain levels experts, the problem of the CPC is to achieve economic development without tainting the revolutionary ideals of mass participation and equality in government.