Did Mao Wreck China?

Did Mao Zedong wreck China’s economic prosperity by implementing a centrally planned economy and communism in China?

No, in fact, Mao grew the economy faster and longer than any leader in history!

Here’s how economic historian Maurice Meisner sums up China’s economy under Mao:

Despite all the failings and setbacks, it is an inescapable historical conclusion that the Maoist era was the time of China’s modern industrial revolution.

Starting with an industrial base smaller than that of Belgium’s in the early 1950s, the China that for so long was ridiculed as “the sick man of Asia” emerged at the end of the Mao period as one of the six largest industrial producers in the world.

National income grew five-fold over the 25-year period 1952-4978, increasing from 60 billion to over 300 billion yuan, with industry accounting for most of the growth. On a per capita basis, the index of national income (at constant prices) increased from 100 in 1949 (and 160 in 1952) to 217 in 1957 and 440 in 1978.

Over the last two decades of the Maoist era, from 1957 to 1975 (a period held in low esteem by Mao’s successors), even taking into account the economic disasters of the Great Leap, China’s national income increased by 63 percent on a per capita basis during this period of rapid population growth, more than doubling overall.”

DID MAO WRECK CHINA?

The Maoist economic record, however flawed, is nonetheless the record of an era when the basic foundations for modern industrialism were laid. Indeed, it is a record that compares favorably with comparable stages in the industrialization of Germany, Japan, and Russia—hitherto the most economically successful cases (among major countries of late modernization:

• In Germany the rate of economic growth 1880-1914 was 33 percent per decade.
• In Japan from 1874-1929 the rate of increase per decade was 43 percent.
• The Soviet Union over the period 1928-58 achieved a decadal increase of 54 percent.
• In China over the years 1952-72 the decadal rate was 64 percent.

This was hardly economic development at “a snail’s pace,” as foreign journalists persist in misinforming their readers. Although it has become unfashionable to recall the accomplishments of Mao’s time, it remains the case that the Maoist regime made immense progress in bringing about China’s modern industrial transformation, and it did so under adverse internal and external conditions. Without the industrial revolution of the Mao era, the economic reformers who rose to prominence in the post-Mao era would have had little to reform.

This economic achievement was all the more remarkable in that it was accomplished by the Chinese people themselves on the basis of their own meager material resources, with little outside assistance or support.

The higher yields obtained on individual family farms during later years would not have been possible without the vast irrigation and flood-control projects–dams, irrigation works and river dikes–constructed by collectivized peasants in the 1950s and 1960s.. By some key social and demographic indicators, China compared favorably even with middle income countries whose per capita GDP was five times greater”. –Mao Zedong: A Political and Intellectual Portrait 1st Edition. by Maurice Meisner

When people ask, ‘Did Mao Wreck China?’ they are reacting to rumors they heard or read, but according to World Bank data, expressed at constant prices (base 1980) and in ten-year averages, China’s economic growth rate was 6.8 percent between 1970 and 1979, i.e., more than double that of the United States during the same period (3.2 percent, also at 1980 constant prices).4

According to China’s National Bureau of Statistics (NBS), China’s GDP growth averaged 8.3 percent annually from 1952 – 2015: 6.3 percent between 1952 – 1978 and 9.9 percent between 1979 – 2015. (These percentages are expressed at constant prices in base 1952 and standardized to take into account the statistical breaks that marked the accounting transition from the Material Product System (MPS) to the more “modern” System of National Accounts (SNA).5)

If we exclude the very first years of the People’s Republic from 1952 to 1962—i.e., between the completion of the unification of the continental territory and the period of the break with the Soviet Union—there is a recorded average of 8.2 percent per annum GDP growth rate in the period of 1963–78, reflecting very rapid growth even during the Cultural Revolution.

The average growth rates of China’s capital stock–including equipment, machinery, tools, industrial buildings, and facilities, but not residential buildings and their land value–showed little difference between the subperiods of 1952–78 and 1979–2015: 9.7 percent for the first subperiod and 10.9 percent for the second.

If we retain a larger productive capital stock, including the inventories, which are important for calculating the rotation rate of circulating capital, we see that the average rhythm of accumulation of such a stock was 10.41 percent between 1952 – 1978 and 10.39 percent between 1979 and 2015. If we select an even larger capital stock to also include the constructed residential buildings and their land, not directly productive components, the growth rate of this very large capital stock continued to be high, averaging 9.1 percent from 1952- 1978 compared to 10.9 percent from 1979 – 2015. In other words, capital accumulation has been continuous and planned by the Chinese authorities for sixty years. It is this sustained effort of accumulation, enabled in particular by surplus transfers from rural areas, that explains the success of industrialization and, to a large extent, the robust rate of GDP growth. Monthly Review | The Enigma of China’s Growth

The chart below shows that, far from wrecking China, Mao grew it faster than any economy in history had ever grown. Did Mao Wreck China? No!

China’s economic prosperity was built on increasing health prosperity. Far from wrecking China Mao, between 1945 – 1974:

• ended death from starvation
• doubled China’s population from 542 million to 956 million
• doubled life expectancy
• doubled caloric intake
• quintupled GDP
• quadrupled literacy
• increased grain production three hundred percent
• increased gross industrial output forty-fold
• increased heavy industry ninety-fold.
• increased rail lineage 266 percent
• increased passenger train traffic from 102,970,000 passengers to 814,910,000.
• increased rail freight tonnage two thousand percent
• increased the road network one thousand percent.
• increased steel production from zero to thirty-five MMT/year
• Increased industry’s contribution to China’s net material product from twenty-three percent to fifty-four percent.
• Put satellites into orbit
• Developed the atomic bomb and the hydrogen bomb faster than anyone in history
• Left China debt-free and independent.

Did Mao Wreck China? No.

[Development Indicators (Washington, DC: World Bank, various years)DataBank | The World Bank (DataBank | The World Bank (DataBank | The World Bank)). –The Enigma of China’s Growth. Zhiming Long and Rémy Herrera. Monthly Review, Dec 1, 2018; China Statistical Yearbook (Beijing: National Bureau of Statistics of China, various years), http://stats.gov.cn/english (http://stats.gov.cn/english) (http://stats.gov.cn/english(http://stats.gov.cn/english)).]

Mao’s Famine

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