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China's institutions must grow with society

By Wang Yukai (Beijing Daily)

15:48, October 11, 2011

It is necessary to carefully research the special characteristics of China's social transition. One of the special characteristics is "dual transitions" – China needs to simultaneously complete both the task of social transition and the mission of institutional transition. China was faced with a dead end after adopting several decades of planned economy. Thereafter, China has been transforming from a planned economy to a market economy, the course of which was never seen in the social transitions of developed Western countries.

The vital issue facing China is that the institutional transition lacks the natural process of historical accumulation. Without the Opium War, China’s commodity economy and private economy could have developed to a certain sophisticated level. However, the Opium War Changed China's internal structure and hindered the development of the private economy, ruining the environment that would have nurtured a commodity economy in China.

After the Communist Party of China came into power in 1949, it chose the planned economy directly and skipped the commodity economy. China walked on the road of the planned economy for 30 years from 1949 to 1979, and then found a big brand standing on the road with two words on it: Dead End.

At that time, the planned economy had grown into a big tree with deep roots and flourishing branches and leaves, though with a few fruit. And it was already too late to completely cut down the tree of the planned economy and plant a small sapling of market economy.

Depending on the mighty strength of China and the Chinese government, Deng Xiaoping changed the direction of China's economy from a central planning to a market-oriented economy. One good point of this active turning was the rapid pace It was like keeping only the trunk and cutting off all the branches and leaves of the planned economy and then grafting the market economy on the trunk.

Grafting was an effective action, but it also meant that prices must be paid. That's why some virtues and good morals fostered in China in the past thousands of years have been washed out during the marketization reform of more than 30 years.

"A gentleman makes money in a right way" is an old saying of China. Unfortunately, many Chinese people currently would shamelessly do every dirty thing to get money, including producing low quality and harmful food products and fake medicine. This phenomenon is telling us that the social foundation and social order of China have already had problems. There are two kinds of forces that control members of the society: morality and the law. The effectiveness of the law is actually based on the effectiveness of what is moral, and if the foundation of what is moral goes wrong, all the laws will become useless no matter how many they are.

Therefore, the first thing that China should do currently is to rebuild the fundamental order of the society. How could we accept a country in which the modernization is realized, the GDP is high, but virtues and morals are lost? China needs to do something to prevent such a moral crisis from appearing right now.


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PD User at 2011-10-1324.26.135.*
Interesting. The 21st century will go down in history as the time when capitalism vs. socialism came to a head. There is evidence that the American Model (capitalism) is failing and that socialism with Chinese characteristics is winning. This may determine the future course of mankind. Jack Smith, USA
Canada at 2011-10-1370.36.49.*
If the masses understand the kind of society China wants to build, socialist ideals are a tie that binds people together, and the dream is something people will fight for. My goal would be cradle to grave security. Universal and free health care, including mental health care, universal and free dental care, free or subsidized prescriptions, decent affordable housing for everyone [perhaps those living in subsidized housing given the deed to their home after paying rent for 25-30 years], free education, affordable day care, a guaranteed annual income above the poverty level, the job would determine income above the minimum. The State could develop institutions to provide preceding services and the benefits could be enshrined in law. Cradle to grave security also reduces peoples stress, thus reducing health care and other costs. Obviously the State doesn’t have the money at present to provide such benefits, and likely won’t for quite some time. In a limited way, Mao’s leadership provided cradled to grave security, however life was difficult, and equality in poverty was not the ideal. I don’t see a planned economy as a dead end. In 1979 China didn’t have the foreign currency reserves or technology to modernize and lift the masses out of poverty. The market economy enabled China to modernize and grow its economy at a rapid pace as capitalist investment and technology flowed in to China. China has a mixed economy and the State still exerts considerable planning. As China continues to modernize, technological advances should enable China to produce most of what China needs with less manpower. In a capitalist society technological advances result in job loss and unemployment, the surplus profit flows into the hands of a tiny minority, it isn’t used to improve the lives of the masses. With a State planned and socially owned economy, technological advances would reduce the socially necessary labour, reducing the hours of work for everyone, and State ownership of most of the means of production, natural resources, and services would lower the cost. The internet gives the State the ability to interact with consumers online and gauge the masses likes/dislikes and quantity of production required, reducing waste. Marx never envisaged socialism occurring before production was sufficiently high to meet all of people’s needs. I would hope that in time as China becomes fully developed and is able to meet people’s basic needs, it would revert to a planned economy, mostly socially owned. In North American countries the American dream boils down to the desire of the masses to own their own home. Although contrary to Marxism, it is likely something socialism should permit, also people take better care of their home if they own it. Perhaps farmers/communes should retain ownership of the land as long as they farm it and sell what they produce. The danger I see is that capitalism gets such a foothold it will turn China into a capitalist society and a revolution would be needed to root it out. At the appropriate time, perhaps raising corporate taxes sufficiently would see corporations voluntarily locate elsewhere. The CPC leaders have made tremendous accomplishments and that came about with State planning.
Julie at 2011-10-1274.248.245.*
That is exactly right, and helping would be to take the emphasis off money. Grassroots organizations are as much for building confidence as they are for the money, hopefully the money is the after effect; the extra.

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