Comments on the Article “Discussion by the Party Groups of Various Financial and Economic Ministries and Commissions on ‘The Economic Problems of Soviet Socialism’”
(November 24, 1958)


Comrade Yang Shangkun:
The first batch of 121 copies should be distributed to all comrades.
Please return them after use.
Mao Zedong
November 24th
[I]
Yang Shangkun was then a candidate member of the Secretariat of the CPC Central Committee and Director of the General Office of the CPC Central Committee.
[2]
This refers to the article “Discussion by the Party Groups of Various Financial and Economic Ministries and Commissions on ‘The Economic Problems of Soviet Socialism’” published in No. 36 of the journal Economic Information. During the discussion, several points were raised:
(1) On socialist economic laws. Some comrades pointed out that Stalin had proposed a basic economic law and a law of planned, proportional development. The former—maximizing the satisfaction of people’s living needs—was put forward as the antithesis of capitalism’s pursuit of maximum profit, while the latter—planned development—was presented as the opposite of capitalism’s anarchic production. However, there lacked completeness and internal connection between these two laws. The Soviet textbook on political economy further added the “law of distribution according to work” and the “law of continuously increasing labor productivity,” which only made matters more confusing. Other comrades believed that the essence of the basic economic law lies in “developing production to meet needs.” To maximize the satisfaction of people’s living requirements, production must be expanded at the highest possible speed. Therefore, it follows logically from the basic economic law that the national economy should first and foremost develop at a high rate, and only secondarily should it be planned and developed proportionally. Simply emphasizing proportional relationships without stressing speed fails to capture the distinctive features and fundamental demands of a socialist economy. The Soviets regarded balance as the fundamental method of planning; they overemphasized equilibrium and planned, proportional development while neglecting to prioritize the pace of growth. As a result, their plans tended to be set too conservatively. Although the rate of development was not slow, it certainly did not qualify as rapid. Plans and proportional relationships should serve to ensure rapid production, not to constrain it. What we seek is not static proportions, but dynamic proportions—proportions achieved amidst rapid development. Some comrades noted that when explaining how socialist production could be continuously expanded, Stalin’s basic economic law mentioned only “advanced technology” but failed to highlight the role of human factors. In his essay “A Great Initiative,” Lenin stated: “Communism is a higher level of labor productivity than capitalism, created by workers who are voluntarily and consciously united and utilizing advanced technology.” Lenin not only emphasized “advanced technology” but also “voluntarily and consciously united workers,” making his formulation clearly more comprehensive than Stalin’s. Stalin’s assertion that technology determines everything shares the same shortcomings as his conception of the basic economic law. Under such a mindset—one that focuses solely on technology while ignoring politics and treating people as mere objects—one tends to calculate only the potential of machinery and equipment, failing to fully appreciate the immense power unleashed by the enthusiasm and creativity of the working people. This overlooks an essential aspect of striving for rapid development. Although the Soviet Union also advocated tapping into the initiative of the working masses, its methods consisted solely of material incentives, without supplementing these with political and ideological education. Consequently, this approach to some extent hindered the rapid growth of the national economy.


(2) On proportional relationships. What exactly are proportional relationships? Some comrades argued that, in essence, they refer to the interrelationships among various sectors of the national economy under the socialist system. It is important not to confuse the law of planned, proportional development with specific proportional relations within economic activities or economic plans. Laws remain constant, whereas proportional relations are constantly changing. The task of planners is not to maintain existing proportions but to continually establish new, more appropriate ones. Based on this understanding, participants concluded that proportional relationships are neither fixed nor something that must always proceed “in proportion” across the board. Rather, they should involve repeatedly breaking old proportions during the course of production and establishing new ones, moving through imbalance toward a new equilibrium. Mechanical notions of balance and proportionality must be discarded, as they can stifle the vibrant mass movement.
Of course, another view—that one should simply disregard proportionality and balance, act first, and then see what happens—should also be opposed; this amounts to a complete denial of planning.


(3) On planning methodology. Some comrades believed that our own planning work, influenced by the aforementioned Soviet thinking, had also suffered certain shortcomings, such as excessive emphasis on balance, often accommodating weaker links; settling for so-called “average advanced norms” while underestimating production potential, particularly the untapped potential of the working people after their ideological liberation. During the discussion, several lessons were summarized from our planning experience:
First, adopt unified planning combined with tiered management, with regional units taking the lead and functional departments playing a supporting role.
Second, place politics at the forefront and follow the mass line.
Third, employ a dual-accounting system, aiming only for rough overall balance, consistently overcoming rather than accommodating weak links, thereby achieving a positive equilibrium.
Fourth, conduct several focused campaigns each year to make continuous adjustments through practical implementation.
Fifth, when implementing plans, guide the national economy to develop in a wave-like pattern: concentrate on a central task, highlight a key priority, and use it to drive progress in other areas. This article was circulated at the Wuchang Conference as an official document.