China's socio-economic changes under Deng Xiaoping

The socio economic changes under Deng Xiaoping

Good afternoon Mr Bean and Students. Today China is recognised is one of the most influential countries in the world, one of the key factors for this influence is the incredibly strong economy which China enjoys. Today I will be looking at how influential the socio economic changes under Deng Xiaoping were to the socio economic position china now occupies. Of all the changes Deng made, the most germane would have to be the promotion of the “Four Modernisations”. This is closely followed by his implementation of the Period of Readjustment of 1979-1981 and the ensuing Reform and Opening beginning in 1982.

The Period of Readjustment, 1979-81

In 1978 the Chinese government declared their intentions to undertake a program of gradual but fundamental reform of the economic system in china. They concluded that the Maoist version of the centrally planned economy had failed to produce efficient economic growth and had caused China to fall far behind. In the late 1970s, China's citizens had to make do with barely sufficient food supplies, rationed clothing, inadequate housing, and a service sector that was inadequate and inefficient.

The first few years of the reform program were designated the "period of readjustment," during which key imbalances in the economy were to be corrected and a foundation was to be laid for a well-planned modernization drive. The major goals of the readjustment process were to expand exports rapidly; overcome key deficiencies in transportation, communications, electricity and primary industry; and redress the imbalance between light and heavy industry by increasing the growth rate of light industry and reducing investment in heavy industry.

The purpose of the reform program was not to abandon communism but to enhance it by substantially increasing the role of market mechanisms in the system and by reducing government planning and direct control. The process of reform was incremental. New measures were first introduced experimentally in a few localities and then were popularized and disseminated nationally, if they proved successful. By 1987 the program had achieved remarkable results in increasing supplies of food and other consumer goods and had created a new climate of dynamism and opportunity in the economy. At the same time, however, the reforms also had created new problems and tensions, leading to intense questioning and political struggles over the program's future.

The central policies of the reform program were introduced experimentally during the readjustment period. The most successful reform policy, the “contract responsibility” system of production in agriculture, was suggested by the government in 1979 as a way for poor rural units in mountainous or arid areas to increase their incomes. This system created strong incentives for farmers to reduce production costs and increase productivity.

The benefits of an incentive system became quickly apparent to the Chinese people;

“Before the new system, when everyone made the same money no matter how hard or little they worked. It was easier to pick large leaves than small ones, this resulted in a higher yield but the quality of the tea produced was very low. Now everyone wants to pick early and often, maybe 30 times a year instead of 6 or 7. So the weight of the tea produced each year is the same, but the quality is first class.”

This quote from a Chinese farmer characterizes the newfound attitude to work in chinese society. Soon after its ...

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This quote from a Chinese farmer characterizes the newfound attitude to work in chinese society. Soon after its introduction the responsibility system was adopted by numerous farm units in all sorts of areas. This system was successful enough to allow Deng in 1983 to lift limits on consumption of many agricultural goods that were instated during the Mao Era due to scarcity.

Reform and Opening, Beginning in 1982

The period of readjustment produced promising results, increasing incomes substantially; raising the availability of food, housing, and other consumer goods; and generating strong rates of growth in all sectors except heavy industry, which was intentionally restrained.

On the strength of these initial successes, the reform program was broadened, and the leadership under Deng Xiaoping frequently remarked that China's basic policy was "reform and opening," that is, reform of the economic system and opening to foreign trade. The practical idea behind the use of the term reform is illustrated in the quote:

“Reform came to mean moving away from the Stalinist-style command economy and embarking on the types of economic reform already implemented in Eastern Europe… Consolidation and improvement meant essentially trying to upgrade the level of management and efficiency”

The adoption of the “contract responsibility” system in agriculture was expanded as the organizational norm for the entire country, and the commune structure was largely dismantled. By the end of 1984, approximately 98 percent of all farm households were under the responsibility system, and all but a handful of communes had been dissolved. The role of free markets for farm produce was further expanded and, with increased marketing possibilities and rising productivity, farm incomes rose rapidly.

In industry the complexity and interrelation of production activities prevented a single, simple policy from bringing about the kind of dramatic improvement that the responsibility system achieved in agriculture. Nonetheless, a cluster of policies based on greater flexibility, autonomy, and market involvement significantly improved the opportunities available to most enterprises, generated high rates of growth, and increased efficiency. Enterprise managers gradually gained greater control over their units, including the right to hire and fire, although the process required endless struggles with bureaucrats.

The role of foreign trade under the economic reforms increased far beyond its importance in any previous period. Before the reform period, the combined value of imports and exports had seldom exceeded 10 percent of national income. In 1980 it was 15 percent, in 1986 it reached 35 percent. Unlike earlier periods, when China was committed to trying to achieve self-sufficiency, under Deng Xiaoping foreign trade was regarded as an important source of investment funds and modern technology. As a result, restrictions on trade were loosened further in the mid-1980s, and foreign investment was legalized.

The most conspicuous symbols of the new status of foreign trade were the four coastal special economic zones, which were created in 1979 as enclaves where foreign investment could receive special treatment. This investment helped the Chinese economy boom. In addition, the Chinese government established a series of joint ventures with foreign capital to establish companies in industries hitherto unknown in China. By 2001, China became a member of the World Trade Organization, which has boosted its overall trade in exports/imports—estimated at $851 billion in 2003—by an additional $170 billion a year. More significant for China's economic development was the designation in April 1984 of economic development zones in the fourteen largest coastal cities all of which were major commercial and industrial centres.

Although the reform program achieved impressive successes, it also gave rise to several serious problems. One problem was the challenge to party authority presented by the principles of freemarket activity and professional managerial autonomy. Another difficulty was a wave of crime, corruption, and--in the minds of many older people--moral deterioration caused by the looser economic and political climate. The most fundamental tensions were those created by the widening income. These concerns played a role in the political struggle that culminated in party general secretary Hu Yaobang's forced resignation in 1987. The commitment to further reform was affirmed, but its pace, and the emphasis to be placed on macroeconomic and microeconomic levers, remained objects of caution.

Four Modernizations

Deng Xiaoping initiated free-market reforms that transformed China's economy. Only 30 years later, China moved from being an economically desolate country into an industrial powerhouse, rapidly overtaking developed western nations in recession.

The goal of the "Four Modernizations" was to strengthen the sectors of agriculture, industry, technology and defence. Class struggle was no longer the central focus as it had been under Mao. The change in political climate was reflected in the propaganda posters of the 70s and 80s, which now promoted the creation of a society of civilized and productive citizens all working toward the welfare of the country and contributing to the modernization effort. Although there were still periodic campaigns against "bourgeois liberalization" or "spiritual pollution," overall the government relaxed its hold over cultural affairs.

Deng’s impact on Modernization is oft, aptly regarded as a:

“Synthesis for the basic theories of Marxism and the reality and present-day characteristics of contemporary china”

The Four Modernizations were designed to make China a great economic power by the early 21st century. Deng decided to accelerate the modernization process by stepping up the volume of foreign trade by opening up China’s markets, especially the purchase of machinery from and . By participating in such export-led growth, China was able to speed up its economic development through foreign investment, a more open market, access to advanced technologies, and management experience.

This has rocketed China into the status of economic superpower and in July 2010, , Deputy Governor of the Bank of China, claimed China's economy had overtaken as the .

Deng illustrated his dedication to the modernization of china over social stratification with the maxim:

"It doesn't matter whether a cat is white or black, as long as it catches mice."

Simply put, he was concerned not with whether a policy was capitalist or socialist as long as it improved the economy. China's phenomenal economic growth largely owes its success to this pragmatism of Deng Xiaoping.

Conclusion

In conclusion, Deng's liberalization of the Chinese economy under the “four modernizations”, along with foreign investment, and the important readjustment and reform periods, helped to power China's modernization, from virtually an industrial backwater in 1978 to the second largest economy in the world in 30 years. Such a rapid change lead to a complete overhaul in the socio economic dynamic and in many respects an equalization of the social stratification of Chinese society.

Burton, C. (1990). Political and social change in China since 1978.

This book reviews the influences of Deng Xiaoping on the economic modernisation of china during the late 1970’s and early 1980’s. Charles burton is a highly reputable historian who has a number of highly decorated publications and is considered to be a veritable authority on a number of subjects pertaining to china. This source was relevant and highly useful. It provided information for nearly all facets of my assignment. The author also describes the dramatic transformation of prevalent social values that has occurred during the same period. The original research and extensive use of vernacular sources, as well as Burton's multi-disciplinary and integrative approach make this volume required reading.

Luh, S. S. (2006). The Economy of China. Mason Crest Publishing.

This source provided little to no information that actually made it into the final presentation. However it provided a number of notes that successfully padded out my research log to a stage that i hope to god will suffice. The author is clearly of Asian decent and as such the perspective is quite probably not a western one. The main reason I did not utilise this source more is because the publisher is mason crest which reminded me of Mason from black ops. However, I do not doubt that in reality this is a highly reliable and distinguished piece of work by a reputable historian.

Lulu, L. (1991). THE STRUCTURE OF SOCIAL STRATIFICATION AND THE MODERNISATION PROCESS IN CONTEMPORARY CHINA. International Sociology .

This source showed how screwed over the poor people of china are and have been, it also illustrates the excess of the rich in china and just how ludicrous the socio economic gap is in china. I utilised this source several times throughout my speech as I like the word’s strata and stratification. It seems to be a reliable source with a lot of relevant information however as usual I wrote my speech mostly off the top of my head with little reference to any facts.

Lynch, M. (2008). Access to History: The People's Republic of China 1949-76. Arnold.

This source was actually of great interest, It was by far the most enjoyable of them to read and had a clear direction in terms of the message it wanted to convey. It contained some useful albeit questionable statistics. But once more as I draw closer to the wee hours of the morning this is due reliability goes out the window if it helps me justify what I just pulled out of my arse.

Phillips MR, L. X. (2002). Suicide rates in China, 1995-99. Lancet.

This was a fascinating read that showed interesting trends and relationships within the culture of suicide in china. However it was not helpful to my argument in fact it would of hindered and as such was not used in my final presentation. The source itself appears to be valid and reliable.

Ross, S. (1989). China Since 1945. Witness History.

At this point I can barely keep my eyes open and actually writing anything of worth in the annotated bibliography seems somewhat redundant. It is highly doubtful that anyone will read this. However, I would like to take this opportunity to point out that I am actually legitimately explaining the function of each of these sources and breaking down their origin.

Steele, P. (1987). China Under Communism (Links: Twentieth Century World History Books series).

This was one of the dryer sources that I used for this presentation it was poorly written and lead me to question precisely why it is we are expected to actually be better of using so called ‘legitimate sources’ when wikipedia seems just as well, if not better written.

Terry Cannon, A. J. (1990). The Geography of contemporary China: the impact of Deng Xiaoping's decade. Routledge.

This was without a doubt the most important source of the lot. I actually found that this source was still useful at two in the morning so I think that speaks for itself as to just how good this source is. At this point even caffeine pills start to lose effect and I may fall comatose at any point. This is a reliable source from a western perspective that illustrates in broad sweeps the various components of the impact of Deng Xiaoping on China.