THE ECONOMIC WEEKLY F e b r u a r y 14, 1959

People's Communes in China A Study in Theory and Technique

B N Ganguli T H E year 1958 — the year o f the

'Great Leap ' in Ch ina — has witnessed the l aunch ing of a r emarkab le experiment i n r u r a l reconstruct ion, viz, o rgan isa t ion of •People's Communes' . Since 1949 China has t r ave l l ed f r o m the .stage of l and red i s t r ibu t ion to t h a t o f ' ag r i ­c u l t u r a l producers' cooperatives' (of the type of Soviet collective farms) after h a v i n g gone th rough the in termediate phase of mu tua l a id associations. F ive or six. years ago one expected, as I d id (vide my hook 'Economic Development in N e w China ' ) t h a t the inter­mediate stage, at any ra te in Cen t ra l and South China, could not be skipped easily. Therefore , the r ap id g r o w t h of more t h a n 740,000 co­operatives by 1958 appeared to me to have been a symptom of econo­mic s t ra in caused by the exigency of genera t ing a larger marke tab le surplus of foodgrains and a g r i ­cu l tu ra l r a w mater ia l s in order to meet the expanding requirements of indus t r i a l i s a t ion and the h igh export targets which are becoming steadi ly higher for compel l ing eco­nomic and po l i t i ca l reasons. At any rate, the most that one could regard as probable was tha t the Chinese peasants w o u l d settle down to the Soviet model of collective f a r m i n g , or some v a r i a n t of i t , depending on local circumstances. I t appears now, however, t h a t one fai led to notice the solid fact t h a t the collective f a r m organisa t ion , as a stereotype, has fa i led in eastern Europe and that even in its homeland it has been go ing t h r o u g h the process of re-organi­sa t ion in te rms of loosening of cen t ra l d i rec t ion , greater local i n i t i a t i v e and better economic i n ­centives for la rger a g r i c u l t u r a l output . I t h i n k t h a t the sudden swi tchover in Ch ina las t year f r o m 'producers' cooperatives' to People's Communes ' is a ma jo r t ac t ica l operat ion w h i c h has t aken account of these developments.

W h y Communes'?

I t i s yet too ear ly to evaluate the People's Communes as an i n s t ru ­men t of r ap id socio-economic change in Communis t China . W h a t I sha l l t r y to assess in th is essay is

i ts ideological v a l i d i t y in terms of o r thodox socialist doctr ine. I t is clear t h a t the r u r a l Commune has not been u n k n o w n in the Soviet Union . B u t i t has been an excep­t i o n , the collective f a r m being the rule. The Chinese People's Com­munes seem to be the rule ra ther t h a n the exception. Moreover, the collective fa rms so recently organised in China in hundreds and thousands have now been 're-organised' in to Communes. W h y is it t ha t w h a t has been recognised as a n o r m for more t han a genera­t ion in U S S R is being so suddenly discarded in China? Is a lower, or perhaps an inap­propriate , f o r m of r u r a l o rgan­isat ion being qu ick ly skipped in the course of the 'Great Leap'? Several other i n t r i g u i n g questions arise as soon as we pose these questions. Is o rgan isa t ion of Communes consis­tent w i t h o r thodox communis t doctrine? If i t is, are Communes par t of the Chinese w a y to socia­lism? A r e the Chinese the correct interpreters of the doctr ine where the Russians went wrong? Or, is it a case of either ' rev is ionism' or 'left devia t ion ' , both of wh ich doc t r inna i re communists w i l l unhesi­t a t i n g l y condemn sooner or l a t e r ? '

T r y i n g to answer these questions is an in te res t ing academic exercise. Bu t I thought the a t tempt w o r t h while at the present moment for other reasons. People's Communes have aroused more t h a n mere curio­sity in I n d i a . Al ready our po l i t i ca l leaders have been t h i n k i n g in te rms of Panchayat-based cooperative fa rms preceded by the development of a net w o r k of service coopera­tives. The entire c o m m u n i t y develop­ment programme is sought to be geared to this broad line of develop­ment on the basis of 'democratic decentral isat ion ' . A f t e r a l l . Com­mune' and 'Communi ty ' are not very fa r apart in a broad sense. M a y it not be tha t c o m m u n i t y development in I n d i a a n d development o f Com­munes in China are r u n n i n g on

para l le l lines, which w i l l not meet because I n d i a and China have differ­ent socio-economic systems, but wh ich w i l l subserve a s imi la r basic purpose?

Cau t ion and Circumspect ion I t i s no t k n o w n to m a n y t h a t E n -

gels had defined the o r thodox socia­l ist a t t i tude to the peasantry in the context of socialist t r a n s f o r m a t i o n in the f o l l o w i n g words w h i c h show extreme circumspection a n d modera­t i o n and a lmost smack o f l i be ra l ­i sm: "We s tand decisively on the side of the sma l l peasant; we w i l l do eve ry th ing possible to make his lo t more bearable, to fac i l i t a te his t r ans i t i on to the cooperative i f he decides to take th is step; if he cannot as yet b r i n g h imse l f to th i s decision, we w i l l g ive h i m p len ty o f t ime to ponder over i t on his hold­i ng . " Len in fol lowed Engels in s t a t i n g t ha t "the representatives of the Soviet government must not resort to the slightest compulsion in the creation of cooperative as­sociations". Moreover, he l a i d down the principle t h a t methods of col­lective f a r m organisa t ion cannot be ident ical in diverse regions of the Soviet Union . But L e n i n had no i l lusions about the response of the peasantry to socialist agr icu l ture . He referred to "the commodi ty -capital ist tendency of the peasan­t r y " . "As long as we l ive" , he said, " i n a count ry where small-peasant f a r m i n g predominates, there is a f i rmer economic basis for capita­l i sm in Russia t h a n fo r commu­n i sm" . I t was diff icult to reconcile Engels ' c ircumspection w i t h th i s ob­ject ive s ta tement of fact . Ye t L e n i n counselled caut ion and circumspec­t ion . Sta l in ' s i n t e rp re t a t ion of Engels ' cau t ion was t ha t Engels was t h i n k i n g in the context of peasant propr ie torship in Western countries as the result of w h i c h the peasant was rooted to the soil . In the Soviet Un ion since l and belonged to the State the peasant's a t t achment to his ho ld ing was not a serious ma t t e r and therefore land na t iona l i sa t ion fac i l i ta ted the t r a n s i t i o n of the ind iv idua l peasant to col lect iv ism. This interpreta­t i on is overs impl i f ica t ion of rea l i ty , as the h i s tory of forced col lect ive

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' I t is reported t h a t Khrushchev has described the Commune as ' react ion ' and t h a t M i k o y a n spoke in U S A of Chinese 'hotheads' .

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la t ion under S ta l in a m p l y demons-rates.

L e n i n thought t h a t vo lun ta r i s t i e cooperative organisa t ion under a regime of State ownership of the means of product ion wou ld usher in social ism in agr icul ture as wel l as in other spheres of economic l ife. Under his New Economic Pol icy he "made a concession to the peasant as a t rader, to the pr inciple of pr iva te t rade". I t was precisely fo r th is t h a t he thought t h a t the "cooperative movement assumes such importance" , for the Soviet regime had found " tha t degree of the combina t ion of pr ivate interest, t r a d i n g interest, w i t h State super­vis ion and con t ro l of th is interest, t h a t degree of i t s subordina t ion to the common interests tha t was fo rmer ly the s tumbl ing block for many socialists". I n Lenin 's opinion, "bu i l d ing a complete socialist socie­ty f r o m the cooperatives alone" was possible. In the par t icu la r case of the peasantry, cooperatives would be a "means tha t w i l l be simplest, easiest and most in te l l ig ib le for the peasantry", Len in therefore, insisted t h a t cooperatives must be gran ted State loans and incentive bonuses. Th i s means tha t L e n i n was opposed to v io l en t ly fo rc ing the pace of coope­ra t ive or collective ag r i cu l t u r a l organisa t ion . Because he showed such modera t ion in his approach to the peasant problem he realised t h a t cooperatives. to succeed in the Soviet Union , have to awai t the spread of l i teracy, development of efficiency and t r a i n i n g in coope­ra t ive practice as we l l as the safeguards against bad harvests and famine. He had, therefore, no hesi ta t ion in saying ( i n 1923) tha t " i t w i l l t ake a whole h is tor ica l epoch to get the whole populat ion to take par t in the w o r k of coope­rat ives t h rough the N E P , At best we can achieve th is in one or t w o decades".

From Collectives to Communes

A f t e r Len in , together w i t h N E P , his and Engels ' caut ion and modera t ion , and the i r theory of the gradualness of the develop­ment of cooperatives, disappeared. There was violence and forc ing of the pace a l l round . Ea r l i e r t han t w o decades af ter L e n i n wrote his a r t ic le ent i t led "On Cooperat ion", collective fa rms became the pa t te rn In the ag r i cu l t u r a l sector of the economy a n d pr ivate t rade vanished. On the Ideological plane S ta l in

professed to fo l low Lenin . Were not collective fa rms a f o r m of cooperatives, the "most s t r i k i n g f o r m of producers' cooperatives"? As S ta l in said in reply to cri t ics , "Lenin 's cooperative p lan means to raise the peasantry f r o m the level of m a r k e t i n g and supply cooperatives to the level of producers' coopera­tives, of collective f a r m coopera­tives, so to speak". Supply and m a r k e t i n g cooperatives had already been developed and consolidated and, therefore, conditions were ripe for the next higher fo rm, the collective f a r m . In one of his polemical essays S ta l in quoted Lenin to say t h a t he favoured the "cooperative, a r te l f o r m o f agr icul ture" . I n an a r te l the pr incipal means of pro­duct ion are socialized, " w i t h the exception of household l and ( smal l vegetable gardens, smal l orchards) , dwell ings, a cer ta in part of the da i ry catt le, small l ivestock, poul­t r y , etc." " I t is the most expedient f o r m for solving the g r a in pro­b lem" -the problem of marke tab le surplus of foodgrains, so crucial in a r ap id ly developing backward economy. Thus under S ta l in the collective f a r m became the highest f o r m of ag r i cu l tu ra l organisa t ion and has remained so d u r i n g the whole period of socialist construc­t ion .

China has fol lowed the ag ra r i an policy la id down by Engels and Len in . There was, however, an impor tan t difference in the objective s i tuat ion in China. As already explained. Stalin's in te rpre ta t ion of Engels ' circumspection w i t h regard to the peasantry was tha t LngeLs was t h i n k i n g in terms of peasant proprietorship so charac­terist ic o f Western Europe. In China owing to the predominance of the peasantry as a spearhead of the Communist revolut ion, ex­p ropr ia t ion of the landlords was fol lowed by land red is t r ibut ion among peasants and recognit ion of peasant proprietorship. Caution, circumspection, education of the peasantry in the ways of cooperative f a r m i n g , special privileges accorded to cooperative associations and pressure of public opinion have characterised ag ra r i an re-organisa­t i on . For China, as for the Soviet Un ion , producers' cooperatives have been necessary to combat the emergence of capi ta l i sm in ag r i ­culture, to ensure large-scale, effi­cient operat ion and to solve the ' g ra in problem' as a condi t ion

precedent to r a p i d Indust r la l i sa-t ion . I t i s clear, however, t h a t China has not needed Lenin 's pres­cr ip t ion of one or two decades of N E P and education and t r a i n i n g in cooperation. N o t on ly t ha t ; wha t was achieved in the Soviet Un ion , t h r o u g h violence and pres­sure, by way of development of collective f a r m i n g on a g igant ic scale and has been the pa t t e rn so long, has either not mater ial ised in China in the same f o r m or has been found inadequate. Otherwise we cannot explain the large-scale and quick 're organisa t ion ' of agr i ­cu l tu ra l producers' cooperatives (the Chinese avoid the expression 'collec­t ive farms ' ) in to People's Com­munes'.

Skipped the Artel Form Before 1 discuss the character

and significance of these "Com­munes' ' on the basis of the state­ment of policy issued on ly last mon th , let me dwell on the or thodox communist t h i n k i n g on r u r a l Com­munes. As already explained, L e n i n la id great stress on the "coopera­t ive, ar te l fo rm of agr icul ture" , w h i c h emerged as the collective f a r m under Stalin 's dispensation. B u t one comes across passages in Lenin 's essays in w h i c h he mentions "Communes" in the context of cooperative associations. I t is not clear whether "Communes" are an advanced form of organisa t ion beyond the stage of "cooperative, ar te l form of agr icu l ture" . For example, he says tha t "the ag r i ­cu l tu ra l commune must be estab­lished vo lun ta r i ly , the t r ans i t i on to common cu l t iva t ion of the l and must be only vo lun ta ry , there must not be the slightest coercion in this respect on the pa r t of the Workers ' and Peasants' Govern­ment, nor is i t permi t ted by l a w "

( emphasis mine ) . S ta l in was. how-ever, definite and categorical on this point. In 1930 he wrote t ha t "the condit ions are not yet ripe fo r m a k i n g the ag r i cu l tu ra l Communes, in w h i c h not only production but d i s t r ibu t ion also is socialized, the predominant f o r m " . "We must not a l low" , he said, "any at tempts to skip the ag r i cu l tu ra l ar te l f o r m and to pass s t ra ight to the Com­mune". He added tha t "large, well-established Communes can exist and develop only i f they possess experienced cadres and t r i ed leaders. Only as the a g r i ' cu l tu ra l artels become s t rong and consolidated w i l l the ground be

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prepared fo r a mane movement o f the peasants towards the Com­munes,"

H a v e the Chinese done precisely wha t S ta l i n forbade in 1930? Have they no t "sk ipped the agr i cu l tu ra l a r te l f o r m " and "passed s t ra igh t to the Commune?" I mus t hasten to po in t out t h a t the essence of Sta l in 's conception of an agr icu l ­t u ra l Commune was socialised dis­t r i b u t i o n ; whereas the Chinese have accepted socialised d is t r ibu t ion in the f o r m of the free supply system' on ly to a very l im i ted extent . In sk ipp ing the Soviet ag r i cu l tu ra l a r te l f o rm of agr icu l tu re the Chi­nese do not propose to sk ip the social ist stage. Th is has been elaborate ly explained in the "Re­solut ion on Some Questions Con-corn ing the People's Communes" adopted by the Cent ra l Commit tee of the Chinese Communis t P a r t y on December 10, 1958. "There w i l l s t i l l be a considerable distance to go to reach the goals of a h igh degree of indust r ia l i sa t ion of the ent i re coun t ry and the mechanisa­t ion and e lect r i f icat ion o f the count ry 's agr icu l tu re ; and there w i l l be an even longer distance to go to reach the goals of an enormous abundance of social products, of a great l i gh ten ing of labour and of a sharp reduct ion of w o r k i n g hours ' ' . T i l l then they w i l l ' ' re ta in the sys­tem of d is t r ibu t ion accord ing to w o r k do re " .

Communes—A Deviation

Is the Chinese 'People's Commune' , then, mere ly a va r ian t of the col ­lective f a r m i n g type of ag r i cu l tu ra l organisat ion? Is the purpose of us ing th is expression to repudiate S ta l in ism and to wh ip up communis t ardour? Or does it embody a dist inc­t ive Chinese experiment in the tech­nique of bu i ld ing up a communis t society w i t h an ideology and prac­tice wh ich t ranscend Soviet t h i n k i n g and pract ice?

An analys is o f the resolut ion to wh ich I re fer red above clear ly shows tha t the Chinese have s t ruck out new lines of t h i n k i n g and prac­tice wh ich are on ly very broadly in con fo rm i t y w i t h o r thodox doctr ine. Whether i t is a ' r i gh t ' dev iat ion or a ' le f t ' deviat ion depends upon the temperament and background of the person who interprets them. But , that it is a dev iat ion seems to be borne out by a ra t i ona l in te rpre ta­t ion of the Resolut ion. In these mat te rs no th ing succeeds l i ke suc-

cess. The 'deviation wil l become the accepted P a r t y l ine i f i t succeeds. W h a t is of interest, however, is the nature of the dev ia t ion.

Democratic Decentralisation

The Chinese Commune is not mere ly an ag r i cu l tu ra l Commune. I t stands fo r "uni f ied management and deployment of labour power and means of product ion on a la rger scale". Na tu ra l ly therefore, i t ceases to be merely an organ isat ion of peasants in to a collective f a r m , as in the Soviet Un ion. I t compre­hends industry , agr icu l ture and i ts a l l ied side-occupations, t rade, educa­t ion , cu l tu ra l and wel fare act iv i t ies and m i l i t a r y a f fa i rs . The Commune has to foster not only agr icu l tu re but also smal l factor ies and has to run ins t i tu t ions fo r collective we l ­fare l ike commun i ty d in ing rooms, nurseries, k indergar tens, homes for the aged, etc. I t represents, there­fore, the t rend towards commun i t y development in a comprehensive sense, based on deployment of local resources and local in i t ia t i ve . In a Chinese Commune the means of l ive l ihood owned by members ( in ­c lud ing houses, c lo th ing bedding and f u rn i t u re ) , and their deposits in banks and credit cooperatives are the i r own property a f te r they jo in the Commune and w i l l a lways belong to them. Members re ta in trees around the i r homesteads and smal l tools and smal l numbers of domes­t ic an imals and poul t ry . They can also engage in smal l domestic side-occupations so long as they do not neglect col lective w o r k . Debts of Ind iv idua l cooperat ive fa rms are not cancelled a f te r a Commune has been establ ished.

The Chinese conception of Com­munes, unor thodox as it may seem in the context of Sta l in ism, goes back to Len in ism in two impor tan t respects. F i rs t , there is the accent on democrat ic decentra l isat ion. In the 1917 resolut ion on the agra r ian question d ra f ted by Lenin we read a remarkab le passage: " a n ag ra r i an r e f o rm can be successful and dura ­ble only provided the whole State is democrat ised, i c. provided, on the one hand, tha t the police, the s tand ing a r m y and the actua l ly pr iv i leged bureaucracy have been abol ished, and, on the other, tha t there exists a comprehensive system of local government ent i re ly exempt f r o m supervision and tutelage f r o m above". I have no doubt tha t Len in 's conception of democrat isat ion at

the base was not the gu id ing p r i n ­ciple of S ta l in ism. I t is perhaps now tha t there is a heal thy t rend to­wards decentra l isat ion and to quote Lenin 's prophetic phrase, "exemp­t ion f r o m supervision and tutelage f r o m above", of which there has been too l i t t le in communist coun­tr ies. I t may be tha t in China re­t u rn to Len in ism is d ic ta ted by the excesses of central ist bureaucracy out of touch w i t h the masses. Secondly, there is another charac­ter ist ic of Chinese Communes, wh ich, though seemingly unor thodox, is a th rowback to Len in ism. "M i l i t i a organisat ions are to be set up at corresponding levels of product ion organisat ions ( in Communes) , the leading bodies of the m i l i t i a and product ion organisat ions being se­para te" , w i t h the result that there w i l l be dual leadership (arms, l ike consumer goods, to be produced loca l ly ) . One w i l l infer, as the Chinese themselves say, t h a t th is is a plan for m i l i t a r y preparedness for defence on a mass basis. But I t h i nk the Chinese also realise w h y Len in had advocated a r m i n g o f workers du r i ng the stage of social­ism. "The socialists demand" , he said, 'the str ictest cont ro l , by society and by the State ' of the measure of labour and the measure of consump­t ion . B u t th is cont ro l must be carr ied out not by a State of bu­reaucrats, but by a State of a rmed w o r k e r s " (emphasis m ine ) . Was not Lenin also prophetic about the "s ta te of bureaucrats ' ' wh i ch has g rown into a Lev ia than in the Soviet Union and threatens to do so in China?

Combining Agriculture with Secondary and Tert iary Industries

The ideological logic of the Ch i ­nese Communes may be explained in other ways as wel l . As already stated, accord ing to the or thodox communis t doctr ine peasant pro­pr ietorship is the potent base fo r capi ta l ism and not communism. To neutral ise the g r o w t h of petty bourgeois men ta l i t y inherent in the peasant's land hunger, his search for ind iv idua l prof i ts and his anx iety to increase the size of his holdings, it becomes necessary to dissociate h im f r om his specific plot of land by assur ing h i m a higher income th rough pool ing of resources and better f a r m i n g on a larger operat ing un i t such as a collective or a co­operat ive f a rm . There are, however, two dif f icult problems for which no

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so lut ion seems to have been found so fa r . F i r s t , the incent ive fo r better and larger product ion cannot be keyed up to a h igh p i tch w i thou t drast ic pressures. On the other hand , payment accord ing to w o r k creates inequal i t ies wh ich , beyond a cer ta in point , sap the sp i r i t of co­operat ion and generate class con­f l ic ts w i t h i n the cooperative or the col lect ive f a r m . There is also the inevi table tendency for the collective f a r m to set i ts own collective interest above tha t of the communi ­ty as a whole and par t i cu la r l y t ha t of the u rban indus t r ia l sector. The conf l ict between town and count ry is as real in a social ist .society in i ts ear ly stages as it is in a capi­ta l i s t economy.

The second problem, wh ich is more serious in overcrowded Ind ia or Ch ina where man- land ra t io is un favourab le for agr icu l ture , is tha t of f ind ing employment for hands wh ich may be rendered redundant as the resul t of appl icat ion of better, labour-sav ing techniques on a large ag r i cu l t u ra l un i t . In Ch ina surplus labour has, to some extent, been absorbed in land improvement and land rec lamat ion , in ru ra l t rans-por ta t ion . in local hand ic ra f ts and smal l industr ies, in f ishing and var ious other side-occupations. But the problem has persisted, by and large. The Chinese feel that the broad-based Communes w i l l provide a so lut ion to those two problems. By w iden ing the bounds of co l lec t iv i ty i n to a large Commune and by combin ing f a r m i n g w i t h other fo rms of economic ac t i v i t y , they hope to neutral ise the probable ant i -social a t t i tude of an exclusively agr icu l ­t u ra l o rgan isa t ion such as the col­lect ive f a r m . By combin ing agr icu l ­ture w i t h secondary and te r t i a ry f o rms of economic ac t i v i t y they have been doing away w i t h the unsound d ichotomy between agr icu l ­tu re and indust ry , wh ich is apt to generate economic tensions even in a social ist society. Thus there is now a real possibi l i ty of complementa­r i t y of economic g r o w t h on the basis of broadbased indust r ia l i sa t ion in the vas t ru ra l areas of the coun­t r y . I f th is possibi l i ty is real ised,

the Chinese conf ident ly expect t h a t i t w i l l be) real solut ion may be eventua l ly found to the problem of ag ra r i an surplus populat ion.

' O w n e r ' h i p by the Whole People'

The Chinese are fu l l y aware t ha t the logic Just analysed m a y not

w o r k in ac tua l pract ice accord ing to the neat theoret ica l design. They have emphasized in the resolut ion of December 10, 1958 the d ist inc­t ion between "socia l is t col lect ive ownership ' ' and "socia l is t ownernhip by the whole people". Col lect ive ownership in the case of collective f a r m s is social ist to the extent t ha t the peasant's ind iv idua l self- interest is subordinated to collective interest; but collective fa rms operat ing in isolat ion f r o m one another may lead to exaggerated expression of the self- interest of collective fa rms at the expense of the interest of the "whole people". Th is is a funda­men ta l cont rad ic t ion wh ich com­munis ts have not yet resolved. The Chinese t h i nk that the Commune m a r k s the beginning of progress towards the resolut ion of th is con­t rad ic t ion . But w i l l not large ly self-sufficient Communes show fissi parous tendencies and fa i l to sub­serve the common interest of the "who le people"?

In pract ice one way of emphasis­i ng "social ist ownership of the whole people" is to put the basic ins t ruments of State power, such as the banks, stores and other enter­prises owned by the people as a whole, under the management of Communes, Thus indust r ia l and other under tak ings , in the construc­t ion of wh ich members of a Com­mune have taken par t , have been placed under Commune manage­ment . There is r isk in s t rengthen­i ng large Communes in th is way ; bu t the Chinese hope tha t it w i l l be min imised by the establ ishment of federat ions of Communes. Never­theless, they f r a n k l y admi t that " the t rans i t ion f r o m collective ownership to ownership by the whole people" w i l l be realised on a na t iona l scale "on ly a f ter the lapse of a considerable t ime" , de­pending upon economic development and the g r o w t h of pol i t ica l under­s tand ing. In any case, ideological ly speaking, the Chinese are quite clear tha t it is not enough to rely on merely collective ownership. There is danger "i f the ex is t ing col lect ive ownership be le f t in tact w i t h the result tha t Commune mem­bers confine the i r a t ten t ion to a re lat ive ly na r row scope of collective interests."

Adjustment of Economic Relations

The Chinese seem to be conscious of another d i f f icul ty which has ar isen in Ch ina as in other com­

munis t countr ies, and wh ich w i l l cont inue to cause tension in the short period, a l though the Com­mune is expected to remove i t in the l ong run . This is the d i f f icu l ty of proper ad jus tment of economic re lat ions between the town and the countrys ide. Wages and incomes and levels of l i v ing are h igher in the cit ies t h a n in the r u ra l areas, owing, among other th ings, to the increasing tempo of indust r ia l isa t ion and the rise of man-hour output in the cities, whi le the countryside lags uncomfor tab ly behind. In an under­developed coun t ry l ike China since indust r ia l isa t ion is s t i l l confined to comparat ive ly isolated pockets in cit ies there is s t i l l the "backwash ef fect" (a la M y r d a l ) o f i ndus t r ia l ­isat ion, which has not been ent i re ly offset by the g row th of output, and employment in the sur round ing ru ­ra l areas. One does not know whe­ther the economic and social dis­tance between the t own and the countryside has in the result , d im i ­nished or increased in China. But , t ha t there is economic d ispar i ty cannot be doubted. The resolut ion of December 10, 1958 says t ha t " the policy of r unn ing indust ry and agr icu l ture s imultaneously and com­b in ing them, carr ied out by the People's Communes, has opened up a way to reduce the d i f fe rence ' between town and countryside and between worke r and peasant" (emphasis mine) . We are to ld t ha t " the reasons that wage levels in the ci ty are general ly higher t han those in the countryside are many-s ided and this is also a temporary s i tua­t ion which should be explained to the peasants. Some Commune mem­bers, apar t f r o m w o r k i n g in the vi l lages, also reeeive money sent home by other fami l y members who are away in the cities. W o r k should be done to dissuade other members f r o m w r a n g l i n g about t h i s " . These two ext racts c lear ly under l ine the rea l i ty of the economic d ispar i ty between the u rban and the ru ra l sectors of the Chinese economy and the tension that i t creates.

One may contend tha t i f People's Communes are good enough for the countrys ide, they should also be good enough fo r the towns. We are to ld , however, that there. are certain differences between town and coun­t rys ide. "C i t y condit ions are more c o m p l e x . . . . Bourgeois ideology is s t i l l f a i r l y prevalent among many of the capital ists and intel lectuals in the cities. they st i l l have misgiv-

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February 14, 1959

ings about the establ ishment of Communes- so we should wa i t a b i t for t hem" . Here is another problem wh ich the Chinese p lan of People's Communes merely br ings out in clear perspective but f o r wh ich i t can find no solut ion, at any rate in the near fu ture.

Marketable Surplus It would be inst ruct ive to specu­

late on Peoples Communes as pa r t , of the st rategy of economic deve­lopment. The Commune is design­ed to be the basic p lann ing uni t l ike a Commun i t y Development Block in Ind ia . But the dist inct ive feature of a Commune is tha t it must have its "own plan of produc­t ion , exchange, consumpt ion and accumula t ion" . I t must develop its own special features and its own in i t ia t ive , a l though its own plan w i l l be subordinated to the State plans. A Commune has to develop both indus t ry and agr icu l ture, w i t h pro­per adapta t ion to local resources avai lable. I have already discussed the rat ionale of the Chinese deci­sion to go in fo r agro- indust ry in a b ig way in the i r Communes. Fo r one th ing , they desire broad based indust r ia l i sa t ion in the predominant ­ly ag r i cu l tu ra l ru ra l areas to ensure concurrent increase of employment and output in both industry and agr icu l ture in remote areas, so tha t , on the one hand, there is more sub­s tan t ia l absorpt ion of surplus m a n ­power in agr icu l ture and, on the other hand, there is better balanc­ing of local supply and demand, as f a r as possible on a local or region­al basis, in respect of foodgrains and manufac tured consumer goods. The Chinese have realised that to ma in ta in commodi ty balances and the balance between purchasing power and the supply of goods and services on a cont inenta l scale requires too elaborate a machinery of controls designed to even out supplies, curb effective demand or s t imula te production In par t icu lar l ines.

Th is does not mean tha t the Communes are go ing to be self-suff i­cient economic circuits, for th is would be disastrous. That is why there is insistence on p lann ing, on the basis of an .extensive system of contracts, of the exchange be­tween the State and Communes and a m o n g the Communes themselves, wh ich "must be g rea t l y developed." To the extent to wh ich the propor­t ion of local products is thus brought w i t h i n the scope of unif ied

d is t r ibu t ion by the State to t h a t extent there is "marke tab le surp lus" avai lable fo r na t iona l purposes. The technique of f o r m i n g federat ions of Communes and tha t o f subordina­t i n g the Commune p lan to the na t iona l p lan and of an extensive system of contracts fo r st ipulated supplies is perhaps designed to guarantee the planned increase of marke tab le surplus needed in the interest of the na t iona l p lan. Bu t how th ings w i l l w o r k out in prac­tice is not clear on the face of It.

Rural Industrialisation The resolut ion of December 10,

1958 th rows in terest ing side-l ight on Chinese t h i n k i n g on ru ra l indus­t r ia l i sa t ion . We are to ld t h a t "People's Communes must go in f o r indust ry in a b ig w a y ' . H o w is th is possible in a vast agr i cu l tu ra l count ry? The Communes have to have plans of 'accumulat ion ' or capi ta l development. The emphasis is on " indus t r ia l product ion closely l inked to agr i cu l tu ra l p roduc t ion" . On the one hand, industr ies supply­ing capi ta l goods fo r agr icu l ture ( fer t i l isers, insecticides, implements, bu i ld ing mater ia ls , etc) must be located in Communes. It is under­stood tha t "Peoples' Communes should develop sel f -support ing pro­duct ion wh ich d i rect ly meet thei r own needs". One may infer , there­fore, that product ion of these capi ta l goods w i l l be on smal l scale. On the other hand, " the processing and many-sided use of agr i cu l tu ra l pro­duce" (manufac ture of sugar, tex­ti les and paper, for example) w i l l also be organised on smal l scale. Ment ion is also made of m in ing , meta l lu rgy , electric power and other l igh t and heavy industr ies, as f a l l i n g w i th in the purview of Communes. I t may be ment ioned tha t capi ta l goods and intermediate products are being manufac tu red local ly and on smal l scale in China. Self-support­ing indust r ia l product ion also means tha t as fa r as possible the prospect of ob ta in ing local raw mater ia ls should be fu l l y taken in to considera­t ion in p lann ing industr ies.

As regards techniques of produc­t ion , the Chinese p lann ing phi lo­sophy shows commendable eclecti­c ism wh ich one does not come across in usual or thodox communis t l i t e ra ­ture. I t i s not commonly k n o w n tha t M a r x was appreciat ive o f the pecul iar combinat ion of smal l indus­t r y and agr icu l ture in I nd ian v i l lage communi t ies before the period of the B r i t i sh rule. Bu t his fo l lowers

in the West have not displayed h is broad v is ion in th is respect. I t i s therefore re f resh ing to read the f o l ­l ow ing ext rac t in the Resolut ion of December 10, 1958: " W i t h regard to product ion techniques, the pr inciple should be carr ied out of l i n k i n g hand ic ra f t w i t h mechanised indus­t ry , and crude methods w i t h modern methods. A l l hand ic ra f t industr ies wh ich have good foundat ions and prospects fo r expansion must cont i ­nue to be developed, and gradua l l y car ry th rough the necessary tech­n ical t r ans fo rma t i on . The mecha­nised industr ies must also make fu l l use of i ron , steel, lathes and other raw mater ia ls and equipment pro­duced by nat ive methods and emp­loy nat ive methods themselves; and gradua l l y advance f r o m crude to modern industr ies, f r o m smal l to large enterprises and f r o m a low to a h igh level."

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