Develop Socialist Production with Greater, Faster, and Better Results at Lower Costs
Return to Fundamentals of Political Economy
15. Develop Socialist Production with Greater, Faster, and Better Results at Lower Costs
The Nature and Goal of Socialist Production and the Means of Achieving This Goal 1
The elimination of the private ownership system of the means of production and the establishment of the socialist public ownership system has led to a fundamental change in the social relations of people in the production, exchange, and distribution processes. First of all, the nature of social production has changed. The goal of social production and the means to attain the goal of production have also changed. Thus, the development of socialist production follows different laws from those of capitalist production. Only by correctly understanding and making use of these laws can socialist production be developed with greater, faster, and better results at lower costs.
Socialist Public Ownership Has Fundamentally Changed the Nature of Social Production
The Direct Social Product under Socialism Possesses, in Varying Degrees, the Characteristics of the Commodity
Production of material wealth is a necessary condition for the survival and development of human society. Under different social and economic systems, however, social products possess different characteristics.
Under the private ownership system of the means of production, production is the individual’s private affair. The product belongs to him. Therefore, production is always directly manifested as private production. The product is also directly manifested as a private product. When this product is not produced for the consumption of the producer, but is instead intended for exchange, then it becomes a commodity. This private product also possesses a social nature. But this social nature is concealed by the private ownership system and cannot be directly manifested. Only through exchanges, when the produced commodity has been proven to meet the needs of society, can the social nature of the product be affirmed. In capitalist society, all products are private products and also commodities. Capitalist production is the most developed form of private commodity production.
In socialist society, after the socialist transformation of the system of ownership of the means of production has been basically completed, with the exception of a small amount of family sidelines operated by members of the rural collective economy, the whole of social production has been established on the basis of a system of public ownership of the means of production. Seen as a whole, the production of the state economy and the collective economy based on the socialist public ownership system is organized according to plans throughout the whole country. It is conducted to directly meet the needs of society, namely, to directly meet the needs of the proletariat and the whole laboring people. This kind of production has lost the nature of private production. Looked at from its basic aspect, it has become direct social production. Labor products are also socially useful from the start, and therefore they are no longer private products but are direct social products. Needless to say, the labor that is engaged in direct social production to create direct social product is no longer private labor but is direct social labor. Engels once observed,
“Once society possesses the means of production and uses them in direct social forms for production, then everybody’s labor, whatever its specific uses may be, becomes direct social labor right away.” 2
In the historical development process of human society, direct social production once existed in the primitive commune. At that time, “the commune members combined to form a society directly for production.” 3 They labored together and distributed products to the members according to custom and need. This was a kind of direct social production based on a system of public ownership by the clan commune. It appeared when the level of productive forces was low and social division of labor was underdeveloped. It was a primitive public ownership economy without commodity production and exchange.
Socialist direct social production is largescale social production based on division of labor and cooperation among millions, tens of millions, hundreds of millions of people. In the fairly long historical period of socialist society, the socialist system of public ownership still consists of two forms. Socialist direct social production is conducted on the basis of these two forms of socialist public ownership. Products are owned respectively by the socialist state and various enterprises under the collective ownership system. This determines that direct social production under socialism cannot eliminate commodity production and exchange. To attain normal economic relations between these two types of socialist public ownership and between industry and agriculture and to facilitate the consolidation of the worker-peasant alliance, it is necessary to retain and suitably develop commodity production and exchange for a fairly long period of time. This cannot be changed at will. Lenin pointed out, “Commodity exchange is a yardstick to measure the normality of the interrelations between industry and agriculture.” 4
Socialist commodities primarily reflect the relation between the economy under the state ownership system and the economy under the collective ownership system and the relations among different collective economies. In the state economy, products are transferred from one state enterprise to another state enterprise. For example, the rolled steel of a state iron and steel mill is transferred to a state plant which builds spinning and weaving machines. Or the weaving machine built by a state spinning and weaving machine plant is transferred to a state spinning and weaving mill. The product is still owned by the socialist state, and there has been no transfer of ownership rights. Furthermore, product transfers among state enterprises are usually allocated and delivered according to state plans rather than taking place through the market. Therefore, this type of product transfer is basically not commodity exchange. It already possesses many characteristics of the communist distribution of products.
But the socialist economy is an integrated whole; the commodity relations between the two forms of socialist public ownership system cannot but be reflected in the exchange relations within the state ownership system. Meanwhile, with the present level of productivity, material conditions demand that the state enterprises maintain their relative independence of operation and management and that they trade with each other according to the principle of exchanges of equivalent value. Therefore, although the commodities exchanged among state enterprises are basically no longer commodities, they still possess certain commodity characteristics and must be expressed in terms of price and purchased with money. When distributed for the members’ consumption, food grains produced by the rural collective economy must also be expressed in terms of price and money. This inevitably brands the product as a commodity. Therefore, socialist products are direct social products on the one hand, but they also possess commodity characteristics in varying degrees. Socialist commodities differ from other historical commodities. They possess three characteristics: (l) They are based on a public ownership system of the means of production and are primarily an expression of the exchange relations between the worker and the peasant. (2) In contrast to the unorganized and unplanned capitalist commodity production, a great majority of socialist commodities are produced in a planned manner under the guidance of state planning. (3) Compared with the capitalist society, the scope of commodities is greatly reduced in the socialist society. Labor power is no longer a commodity. Land, mineral resources, and other natural resources are no longer commodities either. The means of production circulating within the socialist state ownership system have also undergone significant changes and have lost certain properties of commodities.
Direct social products with varying degrees of commodity characteristics are an expression of the special duality of socialist products. They reflect the characteristics of socialist production relations in the transition period from capitalism to socialism. Direct social products are the dominant aspect of this duality. This is the aspect common to socialist and communist products. Although socialist commodities are fundamentally different from all historical commodities based on a private ownership system, the commodity money relationship has, after all, been a tradition of the old economy for thousands of years. Socialist products with varying degrees of commodity characteristics show that compared with communist direct social products, socialist direct social products are still immature and carry with them traditions and influences of the old society. Communist direct social products will be completely free of these traditions and influences of the old society, namely, commodity characteristics. At that time, labor expended on the production of products will no longer be expressed as the value of these products.
That socialist direct social products still possess varying degrees of commodity characteristics is determined by the level of productivity in the socialist period and by the two forms of socialist public ownership system and other material economic conditions. Since socialist products still possess varying degrees of commodity characteristics, categories related to commodities, such as use value and exchange value, concrete and abstract labor, money, price, and so forth, will certainly exist. To negate the commodity aspects of socialist direct social products and to attempt to abolish commodity production prematurely is obviously erroneous. Ch’en Pota, a renegade and Trotskyite, clamored for the abolition of commodity production and exchange during the period of the rapid development of China’s rural people’s commune movement in a vain attempt to lead revolution and construction astray. Chairman Mao saw through this conspiracy in time and engaged him in a resolute struggle. In the resolutions of the Sixth Plenum of the Eighth Central Committee of the Chinese Communist Party personally convened and chaired by Chairman Mao, this was pointed out: “This way of thinking which attempts to prematurely abolish commodity production and exchange, prematurely negate the constructive role of commodities, value, money, and price is detrimental to developing socialist construction and is therefore incorrect.” 5 Socialist commodity production must not only be retained, but must also be developed to consolidate the economic link between China’s industry and agriculture and between urban and rural areas in order to promote the development of socialist construction.
On the other hand, however, we must also see that although socialist commodity production based on a public ownership system is fundamentally different from private commodity production, the fact that products are produced as commodities cannot but still be a reflection of the traditions and influences of the old society. Such categories as commodity, value, money, and price are things that can be used by the bourgeoisie and its agents in the Communist Party. The proletariat wants to use commodity production to promote socialist construction, while the bourgeoisie wants to use commodity production to restore capitalism. In the three years of natural calamities from 1960 to 1962, the Liu Shaoch’i clique unscrupulously advocated an extension of the privately retained plot, an uncontrolled development of the free market, and a system of “internal responsibility for profit and loss” in the state economy. Their intention was to use the principle of capitalist commodity production to “transform” the socialist economy and restore the capitalist system in China. Chairman Mao was the first to discover this evil intention of the Liu Shaoch’i clique. He led the whole Party to solemnly criticize and repudiate the revisionist line carried out by the Liu Shaoch’i clique so that China’s commodity production could develop progressively along the socialist path.
The Socialist Production Process Is a Unity of the Labor Process and the Value-Creation Process
The duality of socialist products is reflected in the duality of the production process for socialist products. As production for direct social products, it is a labor process which creates in a planned manner various use values to satisfy the needs of the proletariat and the whole laboring people. As commodity production, the labor of the producer not only creates various concrete use values but also exchange values. The socialist production process is a unity of this labor process and the value-creation process. The characteristics of socialist production can only be determined with reference to the characteristics of the socialist labor process and value-creation process.
Abstracting from various specific social conditions and examining it from the viewpoint of the functions performed by the various primary factors of production, the labor process is merely a process through which the people who possess labor power embody it in materials, creating expected products — it is a purposeful activity for creating use value, it is a process of material transformation between man and Nature. However, all production processes are carried on under certain social conditions. Therefore, labor processes reflect the relations not only between man and Nature, but also among men.
Looking at it from this viewpoint, there is a fundamental difference between the labor process under socialism and the labor process under capitalism.
The labor process under the capitalist system is a process in which the capitalist consumes labor power. Its characteristics are: The worker labors under the supervision of the capitalist, and labor products belong to the capitalist, that is, labor under the capitalist system is hired labor, slave labor, and hard labor performed by the exploited.
Under the socialist system, for the first time the laboring people become masters of the state and the enterprise. Consequently, there appear in the socialist labor process new characteristics without historical precedent. Lenin said:
“Every factory from which the capitalist has been expelled, or at least in which the capitalist is controlled by genuine worker supervision, and every village from which the landlord exploiter has been expelled and his land expropriated only then becomes the domain of the laborer. Here, the laborer can express his talent, keep his back straight, be proud of himself, and feel that he too is a human being. He has been toiling for others for millennia, performing hard labor for exploiters. Now for the first time, he can work for himself, using all the newest achievements of technology and culture.” 6
The socialist labor process is a process in which the worker, the peasant, and other laborers create material wealth for the laboring class itself. Its characteristics are: The laboring people, as their own masters, are engaged in organized and planned labor in socialist production. The whole labor product is distributed by the laboring class itself. Therefore, socialist labor is planned labor not subject to exploitation and is voluntary labor of the laboring people for the creation of social wealth.
However, the socialist society is a society with classes. In addition to the laboring class, there is the exploitative class. The former exploiters must also labor in the socialist society in which consumption depends on labor. Supervised labor is imposed on the landlords, the rich peasants, and members of other antagonistic classes. The bourgeois elements are allowed to reform through labor in the enterprise. The treatment given to these two exploitative classes is different because the nature of their contradictions with the laboring people is different. But as exploiters, their labor necessarily carries with it varying degrees of coercion. Naturally, this coercion imposed on the exploiter by the laborer is fundamentally different from the coercion imposed by the exploiter on the laborer. In the past, the exploiter coerced the laborer to labor in order to exploit the surplus value of the laborer. Now the laborer coerces the exploiter to labor in order to transform him into a new person. Therefore, the socialist labor process is also a process for reforming the exploiter. This is to say, the socialist labor process does not merely involve material conversion between man and Nature but also contains social and class reform.
As far as the laboring people are concerned, the socialist labor process still carries with it traditions and influences of the old society. This is because the old social division of labor left behind by the capitalist society can only gradually be eliminated in the whole historical stage of socialism. The position of the laboring people in socialist production cannot but be restricted and affected by the old social division of labor: Some people are primarily engaged in mental labor, while some people are primarily engaged in physical labor; some people occupy a position of leadership and management in production, while others occupy the position of being direct producers. The opposition between mental and physical labor is one of the most important sources of inequality in the capitalist society. The socialist society has overcome this opposition. But an essential difference still exists. This essential difference can also develop into opposition under certain conditions. The Soviet Union, under the rule of the Brezhnev renegade clique, is ruled precisely by the bureaucratic monopoly bourgeoisie, namely, a handful of “people using their brains” including Party bureaucrats, intellectual aristocrats, and technical bureaucrats. Therefore, the process by which the laboring people come to be the masters of society and enterprise in socialist society is a long process of struggle. It is not only a process of struggle with the bourgeoisie and its agents in the Party, but also a process in which favorable conditions are created gradually to eliminate the essential difference between mental and physical labor. In the socialist period, although all the laboring people are free from exploitation, labor has still not become the primary commitment in the lives of all the laborers. This remaining tradition and influence of the old society concerning the nature of labor can only finally be swept away in the highest stage of communism.
These characteristics of the socialist labor process are also reflected in the value-creation process.
Every commodity embodies the duality of labor: Concrete labor creates use values, while abstract labor creates exchange values. Value reflects certain social relations. Under different social and economic conditions, the social relations reflected by value are different and so is the formation of value.
Under the conditions of a simple commodity economy, the peasant or handicraftsman produces using his own means of production. Labor products and their values naturally belong to him. After the commodity is sold, he gets back the value of the means of production expended in the production process. But he also realizes the new value created by his own labor. This new value compensates for the value of the means of livelihood required for the reproduction of labor power. This way, the production process can continue on the scale of simple reproduction. Marx called the value-formation process under simple commodity production the simple value-formation process.
Under capitalism, the purpose of commodity production by the capitalist is to exploit the surplus value of the worker. Through the production and sale of commodities, the capitalist gets back the value of the means of production expended in the production process. At the same time, the new value created by the labor of the worker not only compensates for the variable capital used by the capitalist to purchase labor power, but also creates a surplus. This surplus is the surplus value extracted by the capitalist. Marx called this value-formation process in capitalist production the value augmenting process. This category of the value-augmenting process reflects the exploitative relations between capital and hired labor.
In the socialist production process, the labor of the laborer, as concrete labor, transfers and preserves the value of the means of production expended in the production process. As abstract labor, it creates new value. Should this new value created by the producer belong totally to the producer himself?
No. To realize socialist expanded reproduction and to satisfy the various common needs of the laborers, society must control various social funds. These social funds can only come from the new value created by the producer. If the newly created value belongs entirely to the producer himself, then the socialist economy will not be able to carry on expanded reproduction. It can only maintain simple reproduction. The common needs of the laborers cannot be satisfied either. Therefore, in the socialist society, the new value created by the producer must be divided into two parts. One part is at the disposal of the producer himself. It constitutes the labor remuneration fund for the producer and is used to satisfy personal livelihood needs of the producer. Another part is at the disposal of society. It constitutes various social funds, namely, social net income, and is used to further develop socialist production and satisfy the various common needs of the whole laboring people. Consequently, as a producer, a part of the new value created by him has to be deducted for the disposal of society as social funds. As a member of the laboring people, he is fully entitled to enjoy, with the other laboring people, the welfare brought about by the social funds. Therefore, the distribution of the new value created by the producer into the labor remuneration fund and the social fund under the socialist system is fundamentally different from the distribution of the new value created by the worker into wages and surplus value under the capitalist system. Under the capitalist system, labor is a commodity and is subject to the law of value. Wage means the price of labor power. No matter how large the newly created value is, the part that belongs to the worker himself is only equal to the value of those means of livelihood necessary for the reproduction of labor power. The rest, namely, the surplus value, is not only possessed by the capitalist, but is used as a means to increase the exploitation of the worker. Under the socialist system, labor power is no longer a commodity. The laborer is no longer exploited. All of the value created by the producer is at the service of the laboring class. The distribution of the labor remuneration fund of the producer and the social fund is regulated by an overall consideration of common and individual interests and the long-term and short-term interests of the laboring people.
Consequently, the value-formation process under the socialist system is different not only from the simple value-formation process under simple commodity production but also from the value-augmenting process in capitalist production. It is a special value-creation process reflecting socialist production relations. The socialist production process is a unity of this labor process and the value-creation process.
The Basic Economic Law of Socialism Embodies the Most Essential Relations of Socialist Production
The Purpose of Socialist Production Is to Satisfy the Ever-Increasing Needs of the State and the People
The socialist production process is a unity of the labor process and the value-creation process. What then is the dominant aspect of the contradiction in this duality?
One dominant aspect of the contradiction in social production embodies the objective purpose of this social production and reflects the most essential relations of this social production. It is independent of the people’s will; it is ultimately determined by the nature of the ownership of the means of production. Social production has to serve the interests of the class who owns the means of production.
Under the capitalist ownership system of the means of production, the labor process also provides use values. But this is not the purpose of capitalist production. The capitalist operates factories in order to exploit the worker and obtain profit through the value-augmenting process. Value augmentation is the dominant aspect of capitalist production. It embodies the most essential relations in capitalist production. Marx pointed out, “The purpose of capital accumulation is not the satisfaction of needs but the production of profit.” 7 “Capital and its accumulation are manifested as the beginning and the end of production and the motive and purpose of production.” 8
The socialist public ownership system of the means of production makes the laboring people become the masters of production. Social production must serve the needs of the whole laboring people. Therefore, a labor process that creates use values in a planned manner to satisfy the needs of the laboring people is the dominant aspect of socialist production. It embodies the objective purpose of socialist production and the most essential relations of socialist production. The value-creation process is subordinate to the socialist labor process which creates use values. In the socialist production process, it is entirely necessary to compute labor expenditure, profit, and loss. But, what and how much to produce cannot be affected by the size of the value of production and the size of profit. Instead, they should be based on the needs of the whole laboring people. Whatever is urgently needed by the laboring people should be produced in greater quantity with the greatest possible effort, even at the risk of temporary losses. On the other hand, anything that is not urgently required by the laboring people, even if its value of production and profits are high, cannot be indiscriminately produced in great quantity. The reason why it is necessary for the socialist enterprise to compute labor expenditure, profit, and loss is in order to reduce costs so that the enterprise can be compensated in value and can also provide an ever-increasing social fund for developing production at a high speed and increasing the supply of social product. Ultimately, the subordination of the value-creation process to the labor process is for the purpose of creating an ever-increasing quantity of social wealth to satisfy the needs of the whole laboring people. Before the victory of the October Revolution, Lenin pointed out that in socialist society, “the wealth created by common labor is for the benefit of the whole laboring people and not for that of a handful of rich people.” 9
The purpose of socialist production is to satisfy the needs of the whole laboring people. But the long-term interests of the laboring people and their interests as a whole have to be reflected and expressed through the state under proletarian dictatorship. Therefore, the purpose of socialist production can also be described as the satisfaction of the ever-increasing needs of the socialist state and its people. These needs are multifaceted. To develop their morals, intelligence, and physique, there is a need for the proletariat and the laboring people continually to raise the level of their material and cultural life. Since classes, class contradictions, class struggle, the danger of capitalist restoration, and the threat of sabotage and aggression from imperialism and social imperialism still exist in the socialist society, there is a need for the socialist country to consolidate proletarian dictatorship and strengthen national defense. And since the proletariat can once and for all liberate itself only by liberating the whole human race, there is a need for the socialist country to discharge its obligation to internationalism and support the revolutionary struggles of the peoples of the world. Therefore, the purpose of socialist production is to raise the level of the material and cultural life of the proletariat and the laboring people, consolidate proletarian dictatorship, strengthen national defense, and support the revolutionary struggles of the peoples of the world. Ultimately, it must serve to eliminate classes and realize communism.
The great strategic policy formulated by Chairman Mao to “be prepared for war, be prepared for natural disasters, and do everything for the people” fully embodies the objective purpose of socialist production and points out a correct direction for the development of China’s socialist production and the whole national economy. Under the guidance of Chairman Mao’s proletarian revolutionary line and his general and specific policies, China’s socialist production develops vigorously. The level of the people’s material and cultural life is increasing all the time. Proletarian dictatorship is continually being strengthened and consolidated. Within our capacity, we have given aid to the world’s revolutionary enterprises.
In the Soviet Union under the rule of the Brezhnev renegade clique, the law of surplus value governs social production. The purpose of production is to pursue profit and to guarantee that the largest possible amount of surplus value is extracted from the laboring people of the Soviet Union by the bureaucratic monopoly bourgeoisie. But in order to deceive the masses, the Soviet revisionist renegade clique morbidly clings to pseudo-communism. They try hard to distort the purpose of socialist production and say something like: “The highest purpose is to raise people’s welfare.” “Everybody will have enough food, clothing, shoes, housing, and books. We call this communism.” This renegade clique deceives the masses with the sweet talk of bourgeois welfare. The intent is to make them forget class struggle and revolution in order to facilitate this renegade clique’s restoration of capitalism. In the Soviet Union, the only people who eat well, dress well, and are properly sheltered are the bureaucratic monopoly bourgeoisie and the revisionist intellectual aristocracy under their wing. The broad laboring people have again fallen into an abyss of exploitation and suffering. Grasp Revolution. Promote Production
The dominant aspect of the socialist production process, namely, the most essential thing that determines socialist production, is the satisfaction of the ever-increasing needs of the state and the people. To realize this purpose, social production must be developed in order to increase total social output. Marx and Engels pointed out in the Communist Manifesto that after the proletariat has overthrown bourgeois rule, it will use its political rule to expropriate the capitalist.
“[It] will put all tools of production into the hands of the state, namely, the proletariat who has organized itself into a ruling class, and increase total productivity as fast as possible.” 10
When China was faced with the transition from the new democratic revolution to the socialist revolution and the shift of emphasis of Party work from the rural areas to the urban areas, Chairman Mao also earnestly taught us to pay attention to the rehabilitation and development of production, saying,
“From the day when we take over the administration of the city, our eyes have to focus on the recovery and development of this city’s production enterprise.” 11
There are generally two ways of developing social production and increasing total social output. One is to increase the labor force in production as population increases. In general, this may increase the total social output, but it cannot increase per capita product. Another way is to increase labor productivity. This not only increases total social output, but also per capita product. From the long-range viewpoint, the major way to develop socialist production can only be by increasing labor productivity. When he discussed the significance of increasing labor productivity, Lenin said, “Only by increasing production and increasing labor productivity can Soviet Russia obtain victory.” 12 He also said, “Labor productivity is the most important thing that ultimately guarantees the victory of a new social system.” 13
How then can labor productivity be increased to develop socialist production?
Marxism holds that productive forces develop under the constraint and impetus of production relations. In class society, production is always carried on under certain class relations. Even though changes and developments in social production always start from changes and advances in productive forces, big advances in productive forces always occur after big transformations in production relations. In the beginning of capitalist development, it is always necessary to have a bourgeois revolution to make capitalist production relations become the major economic basis of society before big advances in the productive forces occur. In socialist society, it is also only after the establishment of proletarian dictatorship, the penetrating unfolding of socialist revolution, socialist nationalization, and agricultural collectivization, and the establishment of socialist production relations as the only economic basis of society that big advances in the productive forces can occur. When the socialist transformation of the ownership system of the means of production is basically completed, revolution is not yet finished. In production relations, only by consolidating socialist production relations corresponding to the development of productive forces and opportunely adjusting or transforming that part of production relations which conflicts with the development of productive forces can socialist production be developed continuously and rapidly.
Advances in science and technology and innovations in production tools “the determining factor is the people, not things.” 14 play a big role in developing production and raising labor productivity. But science and technology are discovered by people, and production tools are created by people.
“Of all things in the world, people are the most valuable. Under the leadership of the Communist Party, any miracle of the human world can be created if we have people.” 15
The broad masses of China put it well: “Fear not the lack of machines; fear only the lack of ambition. With one red heart and two hands, everything can be produced through self-reliance.” The socialist activism of the broad masses must be mobilized by the political and ideological work of the Party. Only by lifting the key link of political and ideological work, by widely and deeply mobilizing the masses to discuss major national issues, by criticizing and repudiating revisionism, the Confucian and Mencian mentalities and all world outlooks of the exploitative class, and by fundamentally raising the consciousness of the broad masses concerning class struggle and line struggle can socialist production be continuously and rapidly developed.
Therefore, in socialist society, the ultimate way to develop production and increase labor productivity is to insist on continuing revolution under proletarian dictatorship. After the proletariat seizes political power, only by exercising the influence of the socialist superstructure to unfold penetratingly socialist revolution on the political, economic, and ideological battlefronts under the guidance of the Party’s correct line and with the aid of government power under proletarian dictatorship can the sabotage and obstruction of the bourgeoisie and capitalist influence be swept away and destroyed. Only then can socialist production relations be consolidated and improved and can all constructive factors be mobilized to promote the development of socialist production at a high speed. The policy “grasp revolution and promote production” formulated by Chairman Mao correctly reflects the requirement of the objective law governing the motion of the basic contradiction of socialist society. This policy teaches us that only by commanding all economic work with proletarian politics and propelling production with revolution can China’s socialist production be guaranteed to advance with big strides in the correct direction.
The revisionist clique of Brezhnev, Liu Shaoch’i, and Lin Piao always uses the reactionary “productivity-first theory” to oppose continuous revolution under proletarian dictatorship. This renegade clique always deals with production as production and opposes revolution under the pretext of developing production. It even attributes the development of production wholly to the development of science and technology and the improvement of production tools to a reliance on bourgeois experts. The revisionist line pushed by the clique of Liu Shaoch’i and Lin Piao has been overthrown, but the lingering poison of this “productivity-first theory” has not been completely swept away and has to be criticized and repudiated repeatedly.
The Basic Economic Law of Socialism Determines All Major Aspects of Development of the Socialist Economy
The objective purpose of social production and the means to realize it express the basic direction of development of social production and embody the requirement of the basic economic law of society. Different social and economic systems have different purposes of production and different means to achieve it. Consequently, there are different basic economic laws. The purpose of socialist production is to satisfy the ever-increasing needs of the state and the people. The means to attain this purpose is by propelling the development of technology and production through revolution. Therefore, to sum up briefly, the major characteristics and requirements of the basic economic law of socialism are: to continually increase the level of technology, develop socialist production with greater, faster, and better results at lower costs, satisfy the ever-increasing needs of the state and the people, and create the material conditions for the ultimate elimination of classes and the realization of communism under the command of proletarian politics.
The basic economic law of socialism determines all major aspects of development of the socialist economy and the basic content of socialist production, exchange, distribution, and consumption.
As far as production is concerned, what and how much to produce and how production should be arranged in the socialist society must follow what this law demands. In setting up plans, the socialist country specifies the variety, quantity, and arrangement of production according to the requirements of the basic economic law of socialism in order to make the development of socialist production conducive to consolidating proletarian dictatorship, strengthening national defense, supporting the revolutionary struggles of the peoples of the world, and continually increasing the level of material and cultural life of the laboring people.
Socialist exchange must also obey the requirements of the basic economic law of socialism. In determining the proportion of export and import, the proportion of military and civilian use, the proportion of supply to the rural and the urban areas, and the prices of products, the first thing that the socialist country considers is not how much money can be obtained or how much the profit is. The first thing it considers is whether the arrangement is favorable to increasing the level of material and cultural life of the laboring people, consolidating the worker-peasant alliance, strengthening national defense, and supporting the revolutionary struggles of the peoples of the world.
The basic economic law of socialism also determines socialist distribution and consumption. In the distribution of national income and personal consumption goods, the socialist state must obey the requirements of the basic economic law of socialism. For example, the determination of the proportion between accumulation and consumption and the level of wages must take into account both long-term and immediate interests and the collective and individual interests of the laboring people. Similarly, socialist consumption, whether it be group or individual consumption, must be favorable to continually improving the material and cultural life of the proletariat and the laboring people, revolutionizing people’s thought, fostering new socialist customs, consolidating proletarian dictatorship, and accelerating socialist construction.
In summary, the basic economic law of socialism embodies the most essential links between socialist production, exchange, distribution, and consumption. It determines the ultimate direction of development of the socialist economy. The correct understanding and use of the basic economic law of socialism can strengthen our self-awareness, overcome blind impulses in our work, and help us to advance with big strides in the correct socialist direction.
The Rapid Development of Socialist Production Is a Unity of Objective Possibility and Subjective Initiative
The Socialist System Can Make Production Develop at Speeds Which Would Be Impossible for the Old Society
The purpose of socialist production is to satisfy the ever-increasing needs of the state and the people. The degree of satisfaction of these needs is closely related to the speed with which production develops. The consolidation of national defense in the socialist country, the development of cultural, educational, and health facilities in socialist society, the improvement of the material and cultural life of the people, and aid to the revolutionary enterprises of the world’s peoples all require rapid development of socialist production to create the material preconditions. Also, because imperialist rule is always overthrown at its weakest link, the first countries in which socialist revolution is successful are likely to have a relatively weak industrial basis. This all the more increases the objective necessity for rapidly developing socialist production.
Under the socialist system, it is not only necessary, but possible, to have rapid development of production. Chairman Mao pointed out:
“When we say socialist production relations are more suitable for developing the productive forces than the old production relations, we are referring to the conditions in which the productive forces are permitted to develop at speeds which would be impossible in the old society, and consequently, the ever-increasing needs of the people can be satisfied by continually expanding production.” 16
Therefore, a rapid development of socialist production is not a mere hope, but is based on an objective possibility of socialist production relations. It is a manifestation of the superiority of the socialist system.
How can socialist production relations propel production and the whole national economy to develop at high speed?
First of all, the socialist system provides wide-ranging possibilities for the exercise of the production activism and creativity of the laboring people. Under the socialist system, the proletariat and the laboring people are no longer sellers of labor power. They have freed themselves from enslavement and exploitation and have become masters of the new society. They no longer perform hard labor for any exploiter but instead work for the interests of their own class. Labor has become a glorious and great career. This change in the position of the laboring people in social production makes them begin to really concern themselves with production as masters and exercise their inexhaustible talents. People with the ability to labor are the most important factor in production. That socialist production relations can propel production to develop at a high speed is primarily because the activism and creative talents of the laboring masses which have been suppressed under the capitalist system are now liberated.
Second, the socialist system eliminates the immense waste of manpower, material resources, and finances that is inevitable under competition and the chaotic conditions of capitalism. The socialist country can fully and rationally utilize labor and material resources by using a unified plan to direct the development of the whole national economy, using facilities and natural resources in a planned and rational manner, and training and allocating labor power in a planned and rational manner.
Third, the socialist revolution has eliminated the system of man exploiting man and has made it possible to use that part of the wealth which was formerly used by a handful of exploitative classes on parasitic consumption to improve the livelihood of the laboring people and to develop socialist production.
Fourth, the socialist system has cleared a wide road for a rapid development of science and technology. Under the capitalist system, new technology is used only when it can bring more profit to the capitalist. New technology that has already been adopted is monopolized by the capitalist as “trade secrets.” This inevitably restricts the development of new technology. Under the socialist system, the adoption of new technology is for the sake of saving labor expenditure in production. It is also for the sake of reducing the labor intensity of the laboring people and improving labor conditions. Therefore, the development of science and technology becomes a conscious demand of the laboring people. Furthermore, the advanced experience in technical innovations of any one socialist enterprise is the common property of the laboring people. It can be quickly adopted by other enterprises after summing up and extension.
Fifth, the socialist system has eliminated the contradictions between production increase and the relative decrease of mass purchasing power peculiar to capitalism. This is because with the development of socialist production, the consumption level of the proletariat and the laboring people steadily increases and the scale of national construction steadily expands. Economic crises due to overproduction never occur. This clears away artificial obstacles to the rapid development of production.
Although the objective possibility exists in the socialist system for a rapid development of production, there also exist some factors which undermine and inhibit the rapid development of production. Examples are the sabotage activities of the bourgeoisie and its agents, the obstruction from the established influence of the petty bourgeoisie, the ravages brought about by natural calamities, and so forth. In addition to the objective existence of these social and natural factors, there are also subjective factors related to the proletariat itself. On their way to unfolding socialist revolution and socialist construction, the proletariat will certainly be faced with new situations and new problems. In order to understand the objective law of the new situation and to find correct methods to solve the new problem, a period of time is needed to accumulate experience. Socialist construction is not expected to proceed smoothly; it can only advance in a wavelike manner. To turn the objective possibility into a reality of rapid development, our subjective efforts are required. Here a Marxist line which correctly reflects the objective law plays a determining role. Once the line is correct, the political party of the proletariat, good at summing up rich practical experience, will be able to lead the whole laboring people to overcome the sabotage of the class enemy and the obstruction of natural calamities and realize rapid development of socialist production.
The General Line Is a Compass for Building Socialism with Greater. Faster, and Better Results at Lower Costs
After summing up the internal and external experience and lessons in socialist construction, in 1958 Chairman Mao formulated the General Line “go all out, aim high, and build socialism with greater, faster, and better results at lower costs.” It is a Marxist line that fully utilizes the superiority of the socialist system, fully exercises the subjective initiative of people, and seeks to build socialism with greater, faster, and better results at lower costs.
The General Line for socialist construction requires the unification of greater, faster, and better results at lower costs in socialist construction. “Greater” refers to the quantity of products, “faster” refers to time, “better” refers to quality, and “lower costs” refers to less labor expenditure. The requirements of greater, faster, and better results at lower costs are mutually reinforcing as well as interdependent. If we pay attention only to greater and faster results at the expense of better results and lower costs, the result will be poor quality and high costs. From the viewpoint of the long term and the whole situation, it does not really cause greater and faster results but rather smaller and slower results. If we pay attention only to better results and lower costs at the expense of greater and faster results, although product quality may be high, there will not be enough produced. The speed of construction will be too slow to satisfy the needs of the state and the people. Only if we can build socialism with greater, faster, and better results at lower costs can there by a truly rapid development and can the ever-increasing needs of the state and the people be satisfied to the greatest possible extent. The General Line for socialist construction and a whole series of “walking-on-two-legs” policies formulated by Chairman Mao enable industry and agriculture, heavy and light industry, largescale, medium, and small-scale industry, production by foreign and indigenous methods, and so forth to complement and promote each other, thus guaranteeing the balanced development of the various sectors of China’s socialist national economies. This General Line correctly reflects the objective requirements of the basic economic laws of socialism, the law of rapid development in socialist production and the law of planned development of the national economy, and the revolutionary will of the people of the whole country to demand a rapid change in the backward appearance of the country.
How can greater, faster, and better results at lower costs be achieved and smaller, slower, and worse results at higher costs be avoided in socialist construction? The key lies in fully mobilizing mass activism in building socialism. Marxism has long held that “historical activities are the enterprise of the masses.” 17 Chairman Mao teaches, “People, and only people, are the motive force of history.” 18 Chairman Mao pointed out more than once that the masses have to be relied upon to seize political power and build socialism. The Lin Piao clique, loyal disciples of Confucius, slandered the masses in every possible way. They boasted that their “brains are not those of the ordinary peasant, nor those of the ordinary worker.” They tried hard to peddle a Confucian fallacy that “only the most intelligent and most stupid are not subject to change,” fully exposing their position as diehard enemies of the people. Numerous facts demonstrate that the humblest is the most intelligent and the most noble is the most stupid. Only by fully trusting the masses, relying on the masses, respecting the innovative spirit of the masses, mobilizing all constructive factors, uniting all people that can be united, and as much as possible, converting destructive factors into constructive ones can socialist revolution be victoriously unfolded on the political, economic, ideological, and cultural battlefronts and can socialist production and scientific, cultural, and educational enterprises be developed with greater, faster, and better results at lower costs. The General Line for socialist construction emphasizes the combination of Party leadership and the broad people and is a new development of the Party’s mass line on socialist construction.
“Going all out and aiming high” refers to the spiritual condition and subjective initiative of people. This shows that the General Line gives prominence to having proletarian politics in command and emphasizes the role of the revolutionary drive of the masses in socialist construction. The Party’s task in socialist construction is to lift the key link of political ideological work, raise the socialist consciousness of the people with respect to socialism, help the masses master the Party’s Marxist line and general and specific policies, and mobilize and organize the broad masses to struggle for the great enterprise of building socialism. Chairman Mao teaches us: “Social wealth is created by the worker, the peasant, and the educated. As long as these people control their destiny, have a Marxist-Leninist line, and solve problems with a constructive attitude rather than avoiding them, any difficulty in the human world is solvable.” 19 Once the broad revolutionary masses have mastered the Party’s Marxist line, an immense revolutionary drive will be aroused and will become a substantial material force for creating miracles in the human world. The Great Leap Forward in China’s national economy appeared because of this.
Realize a Great Leap Forward in the National Economy through Independence and Self-reliance
Under the guidance of the General Line, “Go all out, aim high, and build socialism with greater, faster, and better results at lower costs,” the working class and the whole laboring people of China are high-spirited and combat ready. Their revolutionary spirit of daring to think, speak, and act is sky high. The upsurge in socialist competition to compare with, learn from, and catch up to the advanced and to help the backward is rising to an ever-greater height. The correct leadership of the Party’s Marxist line enables China’s national economy to develop vigorously through independence and self-reliance. A great leap forward situation has appeared.
Under the oppression and enslavement of imperialism, feudalism, and bureaucratic capitalism, the broad laboring people of China were in the grips of tremendous hardship and suffering. The national economy was at a standstill. For a long time, many industrial products for daily use were all imported from foreign countries. A box of now commonplace matches was called “foreign fire,” machine-woven fabrics were called “foreign cloth,” and nails were called “foreign nails.” There were also “foreign umbrellas,” “foreign oil,” and so forth. Foreign goods flooded the domestic market, driving out China’s domestic industries. This was what was left behind by old China.
Since liberation, under the wise leadership of the Chinese Communist Party, the heroic Chinese working class and laboring people have stood up and are determined to transform the backward old China and construct a prosperous and strong socialist new China. The basic completion of socialist revolution in the ownership system of the means of production and the announcement of the Party’s General Line for socialist construction greatly propel the development of the socialist construction enterprise. Amid the seething Great Leap Forward national upsurge, Chairman Mao pointed out: “We cannot follow the old path of technological development in other countries and crawl slowly along in others’ footsteps. We must break conventions and adopt as much as possible new technology and build China into a socialist and modern power within a short historical period. The Great Leap Forward we are talking about means exactly this.” 20 Under the guidance of the Marxist line formulated by Chairman Mao and the direction of the policy of national construction on the basis of independence and self-reliance, the people of the whole country have developed their own respective industrial sectors. Not only is the field of light industry complete, it also produces enough for both self-sufficiency and export. The old days when the streets were full of imported goods are completely over. China’s own machine-building industry, metallurgical industry, chemical industry, scientific instruments and meters industry, and electronics industry have rapidly been established and developed. In the development process of socialist industry, the lopsided concentration of industry in the maritime provinces which existed in old China has been changed. New industrial bases in the interior have been built, thus gradually rationalizing the location of production capacities and meeting the needs of China’s economic construction and national defense construction. In the practice of the Three Great Revolutionary Movements, new scientific and technical manpower has rapidly expanded, and the level of science and technology is rising continually. Many large pieces of precision equipment and major projects can now be designed and manufactured by us without outside help. On this basis, China has exploded atomic and hydrogen bombs and sent up manmade satellites. China was the first country in the world to successfully synthesize insulin, making an important contribution to the inquiry concerning the origin of life. China was the first country in the world to successfully manufacture a double internal water-cooling turbogenerator. Under the guidance of Mao Tsetung Thought, the Chinese people have broken through one after another scientific and technological barriers and have set new records by leaps and bounds. With the soaring leap in the development of industry, science, and technology, China’s agricultural mechanization is also rapidly pushing ahead. Significant achievements have been won in China’s farmland water control construction, and the effective irrigation acreage has greatly expanded. The “eight-character charter” of soil, fertilizer, water, seeds, close planting, plant protection, and field management for higher agricultural output has been widely practiced.
In the development process of China’s socialist construction, because of the sabotage and interference of the revisionist line pushed by the Liu Shao ch’i and Lin Piao clique, a certain “hesitation” once appeared for some time in some sectors. This was a manifestation of class struggle and the struggle between the two lines in the process of socialist construction. It is a struggle between progress and retrogression. Judging from the whole process and from the whole situation since the establishment of the Republic, China’s national economy has been developing by leaps and bounds under the guidance of the dominant Marxist line formulated by Chairman Mao. From 1949 to 1970, China’s total value of agricultural production increased by 1.5 times. The total value of industrial production increased by more than 18 times. Along with the development of industrial and agricultural production, China’s communications and transportation, commerce, money and finance, and cultural and educational enterprises have also rapidly advanced. The level of material and cultural life of the people has also been raised substantially. These indisputable facts cannot be denied by anyone. The Lin Piao clique vainly attempted to negate the brilliant achievements obtained by the Chinese people under the illumination of the General Line by slanderously saying that “the national economy is stagnant.” This merely further exposed their position as agents of imperialism, revisionism, and reaction, their hatred for socialism, and their wolfish ambition to restore capitalism.
The brilliance of the Party’s basic line for the whole historical stage of socialism and the General Line for socialist construction illuminates our big strides forward. Our great socialist motherland is prospering and progressing. When we look to the future, we feel confident and expansive.
What the Western bourgeoisie failed to do, the Eastern proletariat must and can achieve!
Major Study References
Lenin, “More on the Trade Union, the Present Situation, and the Errors of Trotsky and Bukharin.”
Stalin, Socialist Economic Problems of the Soviet Union.
Chairman Mao, “We Must Pay Attention to Economic Work”
Review Problems
- Why do we say that there is still a duality in socialist products and the socialist production process?
- What are the major characteristics and requirements of the basic economic law of socialism? Why do we say that in order to realize the purpose of socialist production, it is necessary to correctly handle the relations between politics and production and between politics and economics?
- How do we carry through the Party’s General Line for socialist construction in our practice?
20 Footnotes
