The issue of restitution is very important and must be handled with serious attention.

In most cases, local authorities should manage restitution themselves. Counties and communes must come up with some material compensation. If they cannot produce goods immediately, they can issue some vouchers—this is what we call making good on our promises.
The Twelve Articles [2] have already been explained to the peasants, and now they are watching with wide eyes to see whether we can deliver. Failing to deliver is not an option.
Once the restitution issue is resolved within two to three months, the peasants’ enthusiasm will be rekindled.
Counties and communes would do better to put all their assets into restitution, even if it means bankruptcy.
Because we deprived the peasants, which is absolutely impermissible under Marxism-Leninism.
The indiscriminate requisition of the fruits of the peasants’ labor is worse than exploitation by landlords and capitalists. Capitalists at least pay some price, even if it is unequal exchange, but requisitioning gives nothing at all.
We must resolutely make restitution. All sectors and trades that requisitioned goods must resolutely compensate for them.
If everything is paid back, a commune can still function as long as it has a few people and a couple of thatched huts for offices.
Do not worry about the commune having nothing. It had nothing to begin with—it did not start from scratch but from ill-gotten gains.
All industries, housing, and other properties of counties and communes that were obtained through requisitioning must be compensated. Only when everything is returned can they truly start from scratch.
County and commune cadres may be unhappy, but only in this way can we win over the masses, satisfy the peasants, and strengthen the worker-peasant alliance.
When we were in the Jinggangshan period, the proclamations of the Fourth Red Army already spoke of fair buying and selling, and the "Eight Points of Attention" included the rule of fair trade.
Fair buying and selling means equivalent exchange.
We have always advocated fair trade and equivalent exchange.
How did the communes acquire so much in such a short time? It was not through starting from scratch. Restitution must be made resolutely.
Both county and commune levels, along with relevant departments, must compensate—returning goods where goods are available, and money where money is available.
We all agreed to the large-scale development of county and commune industries and the large-scale establishment of subsidiary food production bases.
But once these large-scale campaigns were launched, they led to equalitarianism and indiscriminate requisitioning [3].
It does not matter if county and commune cadres are dissatisfied. If we satisfy the peasant masses, we win one side.
Whoever requisitioned goods—whether government offices, schools, factories, or military units—must pay compensation.
If the communes, counties, and provinces pay compensation and lose on this side, then the other side gains; if this side becomes empty, the other side becomes solid.
The other side is the hundreds of millions of peasants.
To rectify the "communist wind," we must truly make good on promises. Without some pain and setbacks, no lesson will be learned.
Suffering a bit, feeling some pain—only then can we understand the Marxist principle of equivalent exchange.
Equalitarianism and indiscriminate requisitioning were introduced from above; whoever initiated them must take responsibility.
Only when restitution is fulfilled can the working style of cadres be transformed.
There should be boundaries in restitution. For large-scale water conservancy projects, large-scale transportation projects, and large-scale subsidiary food production bases, part of the restitution should be borne by the state.
What the state should compensate, counties and communes should not be made to pay.
Restitution must be understood by county and commune cadres. Without understanding, there can be no correction.
In recent years, we have overdone some things and moved too fast, and it is only right that we face some discipline ourselves.
From now on, it seems that construction can only proceed gradually—perhaps over half a century.
It seems that among the "Five Winds" [4], the most widespread and most harmful are the "communist wind" and the wind of blind commandism.
First, we must eliminate these two.
We must clearly identify what constitutes blind commandism in production; otherwise, we might end up with no command and no planning at all.
Embezzled funds must be repaid. If not within one year, then two; if not two, then three; if impossible in ten years, still must be repaid.
When all goods are returned, debts must be repaid through one’s own labor. Otherwise, embezzlement cannot be eradicated.
Land requisitioned from peasants by government offices, military units, and schools must be resolutely returned. All gardens of offices and factories should be turned into vegetable plots.
In the future, when developing subsidiary food production, we can only reclaim wasteland and must not occupy peasants’ farmland.
After his victory, Li Shimin [5] rewarded his meritorious officials by enclosing peasants’ land.
The same thing happened after the Qing army entered the pass.
Now, the military and schools are enclosing land without paying the people. This is essentially a remnant of feudalism and must be corrected.
At this moment, we should not dwell on the issue of nine fingers versus one finger [i.e., the proportion of achievements versus errors].
In fact, in some places, the shortcomings and errors are not just a matter of one finger—sometimes two fingers, sometimes three fingers.
In short, we must investigate the problems clearly and state the true extent.
Some comrades proposed that when there is rightism, oppose rightism; when there is "leftism," oppose "leftism"; oppose whatever exists, and to the extent that it exists. These words are good.
When the problems are clarified, the masses will also become clear-headed, and the relationship between the nine fingers and the one finger will be understood naturally.
In recent years, people have spoken of ideological confusion, but first and foremost, it was our own thinking that was confused.
On the one hand, the Fourteen Sentences [7] and the Six Directives [8] were put forward, and we also formulated the Eighteen Articles [6]—all aimed at rectifying the "communist wind" and the wind of blind commandism. On the other hand, there came the various large-scale campaigns—large-scale steel production, large-scale county and commune industries, large-scale transportation, large-scale culture and education—which again whipped up the "communist wind."
This is a contradiction, one that cannot be reconciled.
Although we did not instruct people to carry out requisitioning, we failed to plug the loopholes.
Summarizing these experiences and lessons is very important.
From now on, we must avoid such contradictions—no more opposing something on one hand while whipping it up on the other; no more opposing and advocating at the same time.
One notable issue now is that after the Lushan Conference [9], it was estimated that this year would be a good harvest year.
First, we thought that with the Zhengzhou Conference Resolution [10] and the Shanghai Conference’s Eighteen Articles, the "communist wind" had been suppressed, and the one-finger problem had been resolved. Second, we thought that opposing rightism had boosted morale. Third, we thought that the large-scale campaigns would solve the problems. Fourth, we thought that odd-numbered years brought bad harvests while even-numbered years brought good ones.
Unexpectedly, in 1960, natural disasters worsened, and man-made calamities also struck.
These man-made calamities were not caused by enemies but by ourselves.
This year, equalitarianism and indiscriminate requisitioning were worse than in 1958. In 1958, it lasted only four or five months, but this year, it lasted the whole year.
Enemy sabotage also increased. The large-scale campaigns lost their effectiveness, and the "communist wind" blew fiercely.
The biggest and most prominent problem was large-scale industrial development, with industries at and above the county level drawing 50 million laborers.
In 1957, it was 24 million; in 1958, 44 million; and in 1959 and 1960, another 6 million were added, totaling an increase of 26 million compared to 1957.
Of course, not all these laborers were transferred from rural areas, but no matter where they were drawn from, it still affected agricultural production—for instance, grain consumption increased.
Here are a few lessons: First, the "communist wind" must be opposed; we cannot plunder the peasants—this is impermissible under Marxism-Leninism. Second, the various large-scale campaigns again stirred up the "communist wind." Some say the old wind [pre-existing tendency] was predominant, others say the new wind [recent campaigns] was predominant. No matter which, it blew fiercely, and it seems we can only pursue medium-scale or small-scale initiatives. Third, a large number of laborers were transferred, with industries at and above the county level drawing tens of millions.
These three lessons are the main ones.
We must acknowledge them; otherwise, change is impossible.
If the newly added 26 million people do not return [to agriculture], how can we manage? Suppressing [urban labor demand] will be difficult, but it must be done.
In the future, large-scale campaigns should be turned into medium-scale or small-scale ones.
Rural labor must be well organized, and specialized teams should be cut by 20 percent.
We must also carefully study the issue of draft animals.
Producing substitute foods is one way out; another is importing grain from abroad. Each province should try to earn some foreign exchange.
We must also consider whether there will be natural disasters next year. We cannot control nature, and if not, next year could again be a year we cannot turn around.
I agree with all the points raised by Comrade Chen Yun [11].
First, low standards and supplementing grain with vegetables; we must pay attention to this in the coming years. In short, the grain ration standard cannot be high. We must live frugal lives in good times to build reserves, which will allow us to withstand disasters. Second, people and livestock must rest. Third, importing grain.
We should also add the points I just mentioned. The focus of leadership should be on agricultural production: food comes first, markets second, and construction third.
Overall, we should shorten the industrial front, extend the agricultural front, carry out rectification properly, suppress the labor force that has been drawn away, eliminate the "communist wind," and root out bad elements. The large-scale campaigns should become medium-scale or small-scale ones.
If grain production increases, we can then eat a little more.
Also, those who produce more should get to eat more—there should be differentiation.
On analysis, things are still very hopeful. The experiences and lessons of the past three years are very helpful. If we draw on them, they can be turned into positive factors.
(Excerpt from a verbatim record of remarks made while listening to reports at the Central Work Conference on December 30, 1960, kept in the Central Archives.)

**Notes**

--- Notes

[1] This is an excerpt from remarks made by Mao Zedong on December 30, 1960, while listening to reports at the Central Work Conference. The conference was held in Beijing from December 24, 1960, to January 13, 1961.
[2] Refers to the Central Committee of the Chinese Communist Party’s "Urgent Directive on Current Policy Issues in Rural People’s Communes," issued on November 3, 1960, containing twelve articles. See p. 221, note 2, of this volume.
[3] On "equalitarianism and indiscriminate requisitioning," see p. 33, note 1, of this volume.
[4] The "Five Winds" refer to the "communist wind," the wind of boastfulness, the wind of commandism, the wind of special privileges among cadres, and the wind of blind commandism in production, which occurred during the "Great Leap Forward" and the people’s commune movement.
[5] Li Shimin, Emperor Taizong of the Tang Dynasty (599–649), reigned from 626 to 649.
[6] Refers to "Eighteen Questions Concerning People’s Communes," the minutes of the enlarged meeting of the Political Bureau of the Central Committee held in Shanghai from March 25 to April 1, 1959. See p. 165, note 3, of this volume.
[7] Refers to the fourteen sentences that served as the policy for rectifying and building people’s communes, adopted at the Zhengzhou Conference on March 5, 1959. See p. 14 of this volume.
[8] Refers to the six points in Mao Zedong’s letter of April 29, 1959, on agricultural issues to cadres at six levels. See pp. 48–50 of this volume.
[9] Refers to the enlarged meeting of the Political Bureau of the Central Committee held at Lushan from July 2 to August 1, 1959, and the Eighth Plenum of the Eighth Central Committee held from August 2 to 16. During the early part of the meeting, Peng Dehuai, member of the Political Bureau, Vice Premier, and Minister of National Defense, wrote a letter to Mao Zedong offering constructive criticism of the shortcomings and errors in the 1958 "Great Leap Forward" and the people’s commune movement. Huang Kecheng, Zhang Wentian, Zhou Xiaozhou, and others expressed agreement with Peng’s criticism. Mao interpreted the criticism as an attack on the Party and right-wing opportunism, and wrongly initiated a campaign against Peng. The Eighth Plenum adopted a "Resolution on the Errors of the Anti-Party Clique Headed by Comrade Peng Dehuai." After the plenum, an anti-rightist struggle was erroneously carried out in various places. In December 1978, the Third Plenum of the Eleventh Central Committee corrected the erroneous conclusion about Peng Dehuai, and subsequently, the erroneous conclusions about Huang Kecheng, Zhang Wentian, and Zhou Xiaozhou were also corrected. The June 1981 "Resolution on Certain Questions in the History of Our Party since the Founding of the People’s Republic of China" stated: "The resolution of the Eighth Plenum on the so-called ‘anti-Party clique of Peng Dehuai, Huang Kecheng, Zhang Wentian, and Zhou Xiaozhou’ was completely wrong."
[10] Refers to the "Zhengzhou Conference Record"; see p. 30, note 6, of this volume.
[11] Chen Yun, then Vice Chairman of the Central Committee and Vice Premier of the State Council.