THE CHINESE COMMUNIST VISTA OF INDUSTRIALIZATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00039R000200120021-4
• Release Decision: RIPPUB
• Original Classification: R
• Document Page Count: 9
• Document Creation Date: December 22, 2016
• Document Release Date: April 25, 2012
• Sequence Number: 21
• Publication Date: August 20, 1952
• Content Type: REPORT

Declassified in Part - Sanitized Copy Approved for Release 2012/04/26 : CIA-RDP82-00039R000200120021-4
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SGiCU t9? 1
TBE CHINESE CONS 1UNIST VIgTA OF ThINDUaTRIALIZATION.
by Lan Tzu~feng
(from Chun -kuo Chih Sheng Feb lip 192, pp. 6 7 )
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"China's Voice" Weekly, published in Hong Kong
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hina is primarily an agricultural country, its agri~
Although C
economy has never been able to solve its economic problems.
cultural
It must open the way for industrial advancement. This is the theory
that scholars and specialists have arrived at through their studies
over the last hundred years.
With economics having apolitical basis, if China's economic
problems are solved without plan, then the majority of the citi-
zens wi11 have no protection for their livelihood and political au-
thorny will be unable to maintain itself`. In other words, if any
,
political authority lacking in power guides China along the path of
~.
industrialization and completes industrial organization, still that
authority cannot long endure. This is theoretically to be expected.
According to Communist revolutionary reasoning, this theory is
clearly understood. Consequently, when the Communists seized po-
lit 1 authority, they advanced slogans for industrialization which
~.ca
painted a beautiful vista for future industry. However the urgency
of industrialization was already common knowledge in China, and the
Communist vista, however beautiful, offers what means to-attain
this end. Industrialization requires a great quantity of wealth.
is Communist industrialization to obtain this wealth? That is
Where
the question which we wish to discuss here.
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SE~IJR111Y IA 1":r1,AT1OM
f`N a ! l q 1'.
to the Communists, industrial wa th (i,e., capital)
According
is to be derived from the two following sources. Firstly, it is
hoped that increased a icultural production will opera the way to
~'
It is known that land reform will bring about increased
industry.
production because of the stimulated interest created by land
,
rights. Aside from food needed for themselves, there will be some
left over to be contributed to the state, which can be slowly ac-
cumulated as wealth for industrialization. Since Chinese economy
is based on agriculture as formerly, the duty of accumulating cap-
ital for industrial purposes will fall on the farmer.
i.
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In the 7th number of this magazine, in an article by the wri-
'tFluctuations in the Communist Unification of Agricul-
ter called
tore, ;
7 {? I outlined the phenomenon of disparity between the farming
;,.,..
population of China and the area of tillable land, explaining that
the Chinese farmers took advantage of the "overturn" created by h.
and that in the process of dividing up the land the in-
dividual farmer received too little and too scattered holdings, Not
.
was it impossible for the Communists to acquire Bufficient in-
only
dustrial capital, but the farmers were unable to progress in the face
of their age-old impoverishment.
There is no need to go into further details concerning the above
except to point out one further obvious example, i.e., the
theories study of the situation as regards cotton production on the continent.
Cotton is the raw material for the spinning and weaving
,fir ~~~`L~:~~~?,~, r l~a?~ ~
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 Declassified in Part - Sanitized Copy Approved for Release 2012/04/26 : CIA-RDP82-00039R000200120021-4
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industries However the cotton produced on the continent is not
sufficient to expand the spinning and weaving industries. Accord-
ang to Communist estimates, China now has approximately 5,200,000
spindles, of which 4,300,Q00 are in actual operation. Ten million
paculs of cotton are needed to supply 4 million spindles. Accord-
ins to 1950 statistics, cotton produced amounted only to 8,510,000
paculs. This is not sufficient to maintain L. million spindles. It
is far from being sufficient for 5 million spindles. Hence, if it
is planned to increase the number of spindles, how will the addi-
tional cotton be obtained?
The Communists have already done a good deal > to increase cot-
ton production. During February 1950 the Communist "Ministry of
Agriculture" promulgated a directive on plans for increasing cotton
production, placing cotton on a par with grain and indicating that
for the said year-period cotton should be increased by 4,720,000
paculs making a total of 13,230,000 for the year; hence the entire
country should plant 50 million mou of cotton. Taking this into
consideration, even if this plan were completed on schedule there
stall would not be sufficient to restore 5 million spindles to
use.
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this situation may be tabulated as o11ows (the
The results o
source material is from PJN l6 Nov 1951):
Cotton Cotton Whew
Ttem Cone:e c1otb_ Paper _- __,
Productive 100 100 100 100 100
capacity of
present equip-
ment
1950 actual X9.3 8L.,2 100 62.1 55.9
production
armed 75.6 9L+ 98.3 92 61.6
1951 pl
production
Item cigarettes Matches,
loo loo
Productive capacity
of present egp.ipment
1950 actual
production
45,3 31.5
1951 planned production 1.7 39.9
It is not necessary to comment on all the items in the table.
However, one should notice that cotton yarn throughout 1951 due to
shortage of raw material had no way of meeting its productive capa-
city. Hence the production of cotton cloth for 1951 had to be re-
duced also.
CH'EN XUN, Vice-premier of the State Administration Council, at
the session of the CPPC conference during October 1951, admitted in
his finance and economic report that the production of zt cotton yarn
during 1951 for the entire country due to insufficient raw material
did.not amount to an increase of ten percent. From the above figure
- 1j -
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we may y ducluce the amount oil increased production of cotton yarn planned
for in l9 () but no liht is throirn on the possiblity of carrying the plan
out. Hencey the Communists are puttinG forth great efi1ort tc: realize t1u
plan t~, a.ncrearae cotton acreage and cotton planting; Whether they can or.
not 3 the cjue:3tiOf. Expanding cotton acreage and'i.ncreasincotton planting,;
~.;~
rei'iec'tr, the situation a~ regards grain production. Therefore, w den the
C.1 .i not atta,in the planned cotton area of 5(') million mou, CIx' ESN 1
t~xn~nuna.a~ c~.L
u:t wtate(1. in the report mentioned above that the expansion of cotton area
should be "critized" for blind expansion, ". next year we should
encourac,e the farrnerr to expand their train production in order
ate the nation's gra:Ln needs. /Next year w~ must adjust the area deo
devoted to the planting Of grain and industrial raw materials, We must
stabilize: according to this year's average, We definitely cannot reduce
the area to be sown with grain, and we must especially avoid, blind expansion
off; cotton fields. , . I"
In order to restore and develop the spinning and weaving industry, it
is necessary to expand the area planted with raga material, but i?' the plan
u~
is to lae carried out, the food p)2oblem has to be faced. This represents the
'
wretched situat un of "having cured the head when there is also a pain in the
foot " In the last analysis it is the fundamental problem oa' the viilae,
.
i.e., the disparity between viiiag;e land and village populatiOr1,
r,19
Irom \rhat has been said above, it is clear that the country s > million
snimccle~ cannot be put to use in 1952 , Why i top at 1952? li' the farmers
cannot 'ee themselves from their minute holdings, the chances are very siinl
that the communists ill be able to accumulatq industrial capital from
at ricu1ture,
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V41 Y '' 6Y~ e
the ;I,~~?~s ~~in t~1~
er 1i ht indu tri a acevr to
,rah
~.v~ ' Ga~aacy' ~s
at~;a.n r~
alac~v~; ta1a~.e, thhM it ~,nabi~,i'~~' to their i'o~ ~araduc't4l . .,pl ~ ~~,oth,
Gituati0cOtton yarn an(1 CO~
//''~~Q~ that ~h c)c~ are in the same ? .
~they i j Yr
Ticz~p~.'ba1, wl~ic~1 'L~.e Cam~nun~,sta~ count on
~,~ s ecorsource ~c~~ ^ ~ndus'~r~,a7.
~ 't'his is even more value
is ,Carona indusbria1 praductic,a itse1 ,
t s;
connatata,on Lhan the i'bem discus seC. a ~ov~ .
.
u'J~
m' an exa,stin~.i~;la, ~.ndu'u
~e~ ca p it ~ ~ quite osible to speak o
in Ch ~cU, ~~j.an, Mox'oove:r, axncan~; Ih~ t,~.., heavy Indus x' is allQst Out the el .nee th
Gy and wcavl.x~~; ax'e the mast deve~.e~acd,
the J,i2;h'~ iz'adustra.cs ap, ~,nn~,nfa ,,.
the c~inn'
. the time of the first ~tor1d war. Eo~lever, ,
e.nd weavin situation is as descr~.bed abavc, ;-.
rr nduC~'~r~
k; ~ a
Jcnever the Ccm~mun'ts talk u. on about praductiun, it is days q ~S ~.
~sa
' record,,~ TI' ane car two it~.flns of praduction are "ea ,.kin~ ~w the world.s
a~ ba. ,
.una.,~'~ ~~s are delirious with joy (not to spaal~
', ^ec~axdwl~rea~.in, then the ~,asma
o the When t~:iey attaa.n a record in a~a^a,cu~. ure ~~,~y
~~ arida elemeizt,y involved) . rJ 4u~
ood . As for.ndustry, part;cularlY heavY
br
here is some to e p.. c
? reason Dr~aus to be ~~ita.ed
achieved in Chinese histary one
.k,:~"y he o~~~.y record.
industrialtionenarmous~
ashamed off'. The ~;);C'CSC~Il'~ c~isbancs from `
and to be
' rt a t].n"CCOrC~.S7 k
~Zow can r~zae ,pcal~ t~~. size ~ ei?~~t
7u.~ iX1~;
small a,moun~ o:E arnClust~"y. ]~
has a pitiably
China :~ ormnr~.y ,;.
fd'~r
years tour 'years of civil ~rar both because a
.
G' o~ a ~~ar off' reaistanc e anr~
ause of the lack . k oi' k
rectly connected with warfax'e anct bec
the d.e:wtruct~an d' ~
' ~.v~.'~y came to a tanr~still.
yPP
~~.11 and. raw materials, ndus`~ ~rial act the
~cchnical 1'
~, h 1.ed
.bicai authority and have un~i. 'n?
No ~a that the C; ar~snuni s have pgal~ .~1C3n
'U
that they have at iea.,ct had an e;~:ce
Ea y
i one c;D.xl C)11~.~' ucl,%
t;C~Zlt '1Cn'G~ u1
ca ~?p.L ' r tG~'C~ ~.UJ,"1T1C;]:'~.'y ~
~rY' r Y7 a~'
L a,~ It LXt
~J.?tLll1:L"i~;,' 'Lta ad. jLl a', ?5'ld ' ~c;ore: incusG
~J'X),
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~Lhcz cau~ae 01' the a,nriusta:L crisis :i.n thc' countxier oi
~ c ctcrn Ltlrc~pe
iicr in the :'act that they have not acquix'ec new indurtria1 equipment, The
sowca11e:d :Lncree sc in prC. UU,ction is based on the exploitation of labor. Wlien'
ever the; worker) become cons~c icus of this or ~ohexievcr the leaders relax
their told, a crisis occurs . The Chinese Communists do not have new equip-
ment either, and they can only increase their production 'by app7.yin-; the ~aih.p
to the backs of the arker'r . In an editorial, pubiirhecl in PJM 18 Novenn e:r
1951, which dealt with increased, industrial production in the nortia.iest,
it states1 tarat it waa apparent that the ccurirtry could not i.nvccrt maro caiaital
in :Lnc )st:clal equipment, but that the production es rerttia1 ~ Oo(if3 lraci. reachcd
an ali.-t:imo iii h record, and that this eras the r'esu1'u uf' increas:tn,; the rat,
of ia'bcr production and equipment utilization. CHtEN YUN also stated in
his report at the CPFC conference that the increased production on 1951
Baas due'to three causes; (1) increase in number c)f enterprises, (2) ;t,?estoration
af' (a1.ci. rnaclainery and the addition ()f nevi equipment, (3) increase in labor
pr,;duct LCf t C1. equilarncnt utility , Number t]. ree is called the most impor'ii;ant
CDi SE of the increased. producti.on, ri'lli a means
'tlr.at the ConimunistsI increase o nevi productive equipment is insu:'fi.cioni;,
and that tilO increased exploitation of labor must surely someday cause then
unt':)ld. trouble
It should be :ointed ou;'t", that the first nee is of an expanding' :Lndusta:'yr
is .;continuous skill in prod.uction and renewal of equipment. Since the
,art;
Co1T>lnunists are unable to supply their essential econonr, they accun'tuiate ;r
capital from aGriculture, and by increasing the utility of :former equipment
arid. applying Greater labor production, they can proceed. up to a certain point,
at rhich time they are not only compelled/ to stop but they also face a
crisis, 'flr.e only remedy is to cooperate in 'international economy, but since
:v 5!(t
I Zr
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k ra
hF'k i L:
~l6
r.)~ruxr.~rat ' ~caa.~cy : . ci^i.ented only tuilarcls to Soviet tiion and rojects thc~
~,~mL~a
?froe ior1d ~i)~ c+nty c..~' capi.ta1, it ios~; a to environment neceo r~a'y
~.' ~,c~a 11as ~ 1.~
r i .. S ' on itsei i~ a country laUCx In ~aourcee~ ();C
~~rc -~c~v~,F,a~ Ural.
or
capital. a ? On ()? i' xrd.Lrc;tr~.a~. o0d a needed for m~.:capital. ~~~.~~ from ~,~"oauctJ.
". el 'to the inciustria~.i~aati.ar; Ui' Car;urrilta'b China.
purposes, a.l can be ~~~' n ~~ ~~ p
P(aacc a. . ilan ea.ble c0ndi-tiun :or the development oi' industry,
r
~ an :tr~da.r
' ~ ~ bmi~~ ~ca Russian dorninat.~)r; arid a;'e ject ial~l;errlat:l~~nal
but the 1,nc)tac C~omrnuna.r~t~; ~u
esS entry into the 'Korean afar, a great quantity o:C
'peace. By tl.ac, ~~urla0' ~el
been
lice/ to i'econ$trUCti01 1 has been Brasted. Even if
app
aaeal~t~,h alhicka, ~n;lat have c be wucces'ally COz;1pietc d, Chou En-iai has st~a ec1
the s.~nir~ cice talks licnxl 1
t1aat natiOnai production;la0ulc,L be aimed at sccL~.rir!C
at ~I~h~:a t;a?l'C; c:~.:n:['e;r'cn,c.cw
a
,.,. , l~;.c:.racc; it is cl.car th~~~~ ,Cx'ara n~:~a7 on -c1~; Cozi~~n~7.na,s~i,
t~1~ {.+.~J.l:~aiila :),~ the c~nuay,
,
,:, r)I'tance on ;1iiiitQrY recomStructiori than on economic
policy r;:l.aCC:s moat :U ~r~a1~.
r. C COnS'truc irar; ,
t aahether the Cormufli ats rely on ai':Lcu1ture Or
1~ :e',..7;a ~lii ~ s tandlao~x;1 ,
a e no means o:C' acCLUnulatinthe c~ahl they need
iracl.us ~L:ry,,r i~L s c~ la. , they h v
? ~ ~ . it r~nvir~-nmen't, concl1t101s, and policy make it
?1011 ind.u;tri.czla.zat:LOn, '~11c
? them to :C'oiloas the road. to industrial1zati0n. Hence
it>apo c, s..blc. for
' anon is a va.ata ~ihl.Ch may be seen but may not be
Commun~.ut :i.ndust:e'iala.7
a^cachFCl., x~ they cannot complete their political authority by i.ndustr.'iali?~ation,
then their Suture is bleak indeed.
..R .:~{tern;
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