China’s New Economic Plan: Whatever Works : Party Congress Told That Anything Contributing to Growth Is Permitted Under Socialist Theory

BEIJING —  The 13th National Congress of China’s Communist Party opened Sunday with the presentation of a new theory ideologically justifying anything that contributes to economic growth.

In a report to nearly 2,000 delegates in the Great Hall of the People, acting General Secretary Zhao Ziyang declared:

“To make China prosperous and strong, to make the people rich, to make education, science and culture flourish, to consolidate and expand public ownership and the state power of people’s democracy--in a word, to give full play to the superiority of socialism and to steadily enhance its appeal at home and abroad--all this, in the final analysis, hinges on the growth of the productive forces.

“Whatever is conducive to this growth is in keeping with the fundamental interests of the people and is therefore needed and allowed to exist by socialism,” Zhao said. “Conversely, whatever is detrimental to this growth goes against scientific socialism and is therefore not allowed to exist.”

Zhao’s 2 1/2-hour speech, which also outlined projected economic and political reforms including commercialization of housing and creation of a civil service system, was the only item of business handled by the congress Sunday.

The session was presided over by China’s top leader, Deng Xiaoping, 83. Zhao, 68, sat on his left. On Deng’s right sat Chen Yun, 82, a veteran economist and central planner. Chen was a key ally in Deng’s 1978 rise to power, but in recent years he has been the most potent orthodox critic of some of Deng’s reforms.

Chen, who seldom appears in public and is obviously ailing, was helped to his seat by Zhao. After an hour and a half, as Zhao continued to speak, Chen passed a note to Deng, rose and left early, taking a full two minutes to walk roughly 70 feet to exit the stage.

The new theory outlined by Zhao is based on the concept that China never experienced capitalist industrial development as envisioned by Communist theorist Karl Marx and thus remains a poor country that can only be in “the primary stage of socialism.”

Because of this situation, according to the new ideology, China must develop its economy by whatever means are effective, including the use of techniques more commonly associated with capitalist economies.

The theory thus provides an ideological underpinning for a variety of market-oriented reforms that have been criticized by Chen and other orthodox leaders. The new ideology is apparently intended to strengthen the hand of reformist leaders such as Zhao and encourage implementation of reforms at all levels of society.

Techniques such as the issuance of stocks and bonds and the use of market mechanisms, rather than central planning, to allocate financial, technical, labor and other resources, “are not peculiar to capitalism,” Zhao declared. “Socialism can and should make use of them.”

Practical Criterion

Expansion of “the productive forces” should be “the point of departure in our consideration of all problems, and the basic criterion for judging all our work should be whether or not it serves that end,” Zhao said.

Zhao stressed that the Communist Party has no intention of giving up its monopoly on power or allowing China to turn into a capitalist society.

“Adherence to the four cardinal principles--that is, keeping to the socialist road and upholding the people’s democratic dictatorship, leadership by the Communist Party and Marxism-Leninism and Mao Tse-tung thought--is the foundation underlying all our efforts to build the country,” he said.

But Zhao also took some of the rhetoric of an orthodox ideological campaign against “bourgeois liberalization”--a code phrase for capitalism and Western concepts of democracy--that was launched earlier this year and turned it around to attack critics of reform.

“We must not take an ossified view of the four cardinal principles or we will doubt or even reject the general principle of reform and opening to the outside world,” Zhao said. He continued:

“In the primary stage, when the country is still underdeveloped, ideas of bourgeois liberalization, which rejects the socialist system in favor of capitalism, will persist for a long time. With ossified thinking and without reform and the open policy, we will not be able to demonstrate the superiority of socialism more fully and enhance its appeal, and this will amount to encouraging the growth and spread of bourgeois liberalization.”

Warns Against Complacency

Zhao acknowledged that China’s reformers have found their task more difficult than they expected, and he warned that China cannot afford to be complacent.

“We must be soberly aware that we still face a great many problems and difficulties, many more than we anticipated,” he said. “We are still at a quite backward stage because we lost too much time in the past.

“Today’s world is characterized by a rapidly growing revolution in technology, increasingly intense market competition and a volatile political situation. We are faced with formidable and pressing challenges. If we do not realize all this, and fail to redouble our efforts, our country and our people may fall further behind.”

The key task in deepening economic reforms, Zhao said, is to create incentives for state-owned enterprises by implementing new managerial methods “so that enterprises will be able to make their own management decisions and take full responsibility for their own profits and losses.”

Managers should be selected through competition and rewarded or penalized “mainly according to the economic performance of the enterprises, including the increase or decrease in their assets,” Zhao said.

Changes in Housing

Housing, which currently is so heavily subsidized that Chinese pay rents of no more than a few dollars a month, should be commercialized “so as gradually to make this industry a major pillar of the economy,” Zhao said.

But ultimately, Zhao said, reform of the political structure aimed at removing the party from day-to-day administrative tasks is necessary for economic reforms to succeed.

In enterprises, party organizations should allow factory managers to provide overall leadership, he said.

Although the party will continue to control the government from the top, government units should be allowed to function without interference from a parallel structure of party cells, he said.

Party committees should no longer put members with no official government position in charge of government work, and party departments that overlap with government departments should be abolished, he said.

While the party will continue to select government officials for positions requiring examinations “in open competition, their promotion, demotion, reward and punishment will be mainly based on their work results,” he said.

Long-Term Program

Zhao acknowledged, however, that changes in the political structure may take a long time to accomplish.

“The immediate objective for the reform of the political structure is limited,” he said. “In some areas, results can be obtained within a few years, while in others it may take 10 years or even more.”

Zhao’s report, although submitted to the congress for deliberation, in effect already has the force of new policy. It was extensively discussed and revised at the top levels of the party over the last few months and was reviewed and endorsed last week by the party’s 12th Central Committee.

In addition to discussing and approving the report, the eight-day congress will elect a new Central Committee, which in turn will elect new members to the powerful Politburo and the Politburo Standing Committee. The last National Party Congress was held in 1982.