China’s Economic Development since the 1950s

The last 50 years have witnessed a remarkable economic and political change in China. For many, the rise of the modern Chinese state is equaled to economic and political miracle; in reality, not the miracle, but a whole set of realistic reforms laid the foundation for the rapid economic growth in China. Chinese model of economic growth was not perfect, and evidently, the country had to pay a definite price for its wonderful and almost unbelievable achievements.

However, even at times of serious economic and political crises, China did not lose the sense of its national dignity and pride. To understand the essence and the implications of the Chinese economic development means to understand the way the country was able to embrace the benefits of the communist system and the best features of the market economy; and China’s “putting people first” is the best and the most appropriate social perspective that can be used to analyze the rapid Chinese transformation over the course of 50 years.

China’s Economic Development since the 1950s Introduction The last 50 years have witnessed a remarkable economic and political change in China. For many, the rise of the modern Chinese state is equaled to economic and political miracle; in reality, not the miracle, but a whole set of realistic reforms laid the foundation for the rapid economic growth in China. Chinese model of economic growth was not perfect, and evidently, the country had to pay a definite price for its wonderful and almost unbelievable achievements.

However, even at times of serious economic and political crises, China did not lose the sense of its national dignity and pride. To understand the essence and the implications of the Chinese development means to understand the way the country was able to embrace the benefits of the communist system and the best features of the market economy; and China’s “putting people first” is the best and the most appropriate social perspective that can be used to analyze the rapid Chinese transformation over the course of 50 years.

Pre-industrial China: the beginning of the 1950s and the legacy of the past Profound analysis of the Chinese economic and social revolution is impossible without analyzing the state of Chinese economy at the edge of the 1940s. After the Sino-Japanese War, China found itself in the midst of the growing economic crisis. “Russian troops occupied Manchuria and selectively dismantled industrial installations, carrying them off to the Soviet Union. Only the more modern and up-to-date equipment was carried off; the oldest and the most obsolete machinery was left in place” (Eckstein, 1997).

Thus, by the end of the 1940s, the country was facing the deepening industrial crisis, which was accompanied by the need to restructure its system of agriculture, and to provide the national population with reasonable instruments for survival. As a result of industrial devastation, by the beginning of the 1950s Chinese industrial output fell almost 70 percent; the consumer goods output did not exceed 30 percent compared to the previous industrial peak in the 1940s (Riskin, 1987). The production decline was combined with the growing government expenses, and the government’s striving to reduce inflation and further, hyper-inflation.

As a result, the nation was seeking the means of economic and social modernization; the communist model of economy and distribution has become the source and the basis of the major economic initiatives in the 1950s’ China. Late Maoism, egalitarianism, and equal distribution: putting people first Despite traditionally negative attitudes toward communism as such, late Maoism actually served the basis for developing and implementing a whole set of egalitarian policies – the policies that promoted redistribution of income and did not welcome the benefits and privileges of the social ranks and statuses.

Redistribution and egalitarianism were further combined with industrialization and slow restructuring of the national agriculture. The First Five Year Plan has paved the way to rapid growth of less industrialized Chinese provinces: “all employee wages in state sector were set nationally and did not vary with labor productivity. Thus although more industrialized provinces had a higher proportion of well paid industrial workers in their industrial labor force, these workers wages were similar to those in less industrialized provinces where labor productivity was lower” (Riskin, 1987).

The Great Leap initiative was developed to utilize labor surplus and to promote technological production (Eckstein, 1997). Whether those “equality” approaches were beneficial for all is not clear; but at that point of economic development the state was making everything it could to provide its citizens with material incentives for economic and social transformation. Maoism was promoting the value of unity, cohesiveness and social mobility, but those seemingly positive elements simultaneously sped up and retarded Chinese social and economic development.

On the one hand, Mao was able to build a “developmentally oriented regime” (Eckstein, 1997), where people were committed to achieving the strategic national goals; on the other hand, conservative beliefs and outdated agricultural system were serious barriers to Chinese economic innovation (Eckstein, 1997). Nevertheless, Maoism was an essential component of Chinese movement to economic and social highs. Maoism positioned a Chinese citizen as the source and the center of the major transformational initiatives.

Since the beginning of the 1970s, China was able to utilize the best features of Maoist egalitarianism, including personal initiative, inventiveness, innovation, and the willing to implement changes at all levels of the national economic performance. The 1970s, the revolutionary growth, and the new China By the beginning of the 1970s, China has finally realized the weakening potential of communism as the instrument of social change. At that time, the need for a new scientific development concept became evident.

At the 10th Session of the Chinese Congress “the five balanced aspects – balancing urban and rural development, balancing development among regions, balancing economic and social development and opening wider to the outside world – became the major topic of discussion among deputies” (Consulate General of the People’s Republic of China in Houston, 2008). The need to promote social welfare pushed Chinese authorities to the need for reconsidering the major Maoist policies and reviving them in a more reasonable and measured form.

China could no longer solely rely on the outdated communist values. To become an international economic power, the country had to adopt a new set of social and economic visions that would fit into the contemporary international developmental frameworks. International speed of economic development led Chinese policymakers to reevaluating the balance between agriculture, raw materials production, investment, and consumer products output. “Putting people first” has become the international top priority, and China could not ignore the significance of those humanist trends.

Chinese economic openness and the development of the new market initiatives signified Chinese preparedness to a marking shift in its attitudes towards its people and the rest of the world. “Putting people first” ideals have become the leading factors of the Chinese revolution at the end of the 20th century. Ultimately, “putting people first” marked the Chinese authorities’ willingness to innovate, stimulate, and learn from their own mistakes. Conclusion “Putting people first” was the distinctive feature of the Chinese economic revolution throughout the last five decades.

China was able to embrace the benefits of Maoist communism and market openness in a way that benefited the nation, and primarily, its people. Regardless whether China was following the economic ideals of equal distribution and industrialization, or whether the country was adapting to the new market order, people were the central elements of the Chinese political ideals; and “putting people first” is the most appropriate and the most reasonable perspective that can be used to analyze and evaluate Chinese way to economic and social prosperity.