The dynamic of class contradictions on an international scale revealed the core weakness in the theory of socialism in one country, forcing Mao to abandon his New Democracy step by step. An economic blockade had obliged the CCP to carry out the seizure of US property in China, and destroyed the hoped-for collaboration. The Korean War and direct threat of imperialist invasion together with their growing strength in the economy had given sections of the national bourgeoisie sufficient confidence to mount a campaign of economic sabotage, to corrupt CCP members, and to launch other anti-revolutionary activities. In the countryside, the rich peasants were feeling their strength and demanding to be allowed to get on with the job of food production, i.e. to grow into landlords.
Industrial output had grown rapidly after 1949, by roughly a fifth to a quarter each year and it soon became clear that a major factor limiting expansion was the disparity in growth between the different sectors of the economy; insufficient raw materials, and inadequate power supplies and transport facilities. This on its own pointed to the need for greater co-ordination and planning. Under these pressures and threats, the CCP was forced to take a big step forward by abandoning the reactionary illusions of New Democracy and adopting a series of objectively revolutionary measures. These were reactions, taken for self-preservation without any real understanding of the motor forces driving events.
In the exceptional circumstances following WWII the class-collaborationist stance of the CCP had not stopped Mao coming to power. But once in power the official line of the CCP meant that the New Democracy was at odds with what was actually happening. The national bourgeoisie was not rationally assessing what was best for China and acting accordingly; it was acting in its own interests. Even though it represented the smaller part of the economy it was successfully corrupting the CCP and the state machine. In only three years it had shown it could soon grow into a real threat to the interests of the bureaucracy. Determined to protect their newfound privileges and power, the bureaucracy made a series of empirical adaptations to events before accepting that the New Democracy was irreversibly breaking down.
At the beginning of 1953, the CCP proclaimed that the bourgeois-democratic phase of the revolution was passing and its socialist phase was beginning. With its 1st FYP (1953-1957) for economic construction and industrialisation, the CCP abandoned the New Democracy and replaced it with the policy of state and private co-operation, which aimed at the abolition of bourgeois property and the beginning of socialist construction. On 1 October 1953, the fourth anniversary of the founding of the People’s Republic, the government proclaimed “the general line for the transition to socialism” and finally buried the New Democracy. Despite the prominence of the New Democracy in formal Maoist theory, and its promise of a lengthy stage of capitalist development, the bourgeois phase of China’s post-revolutionary history was abruptly terminated after just four years.[49]
Cohen describes the abruptness of the change in Party line that took place in mid-1953 when suddenly the “transition to socialism” was at hand in China. He says that in a four-month period (July to October), the perspective that the New Democracy was an economy in which the private sector could flourish, was ditched and replaced by the perspective that capitalism could and should be crowded out quickly. Then in October 1953, an intense national campaign was launched. This lasted about two and half years until by 1955/6 there had been a complete transformation with even small businesses becoming state enterprises.[50]
By 1956, approximately two-thirds of all modern industrial enterprises were directly state-owned, and the remaining one-third was under joint public-private ownership. No privately-owned firms remained. In true Stalinist fashion the change was all-encompassing, even micro-scale industries were organised into co-operatives which accounted for just over 90% of all handicraft workers.
In 1954 there was widespread discussion on the new state constitution to supersede the Common Programme and which would bring the New Democracy phase of China’s development to a formal end. The constitution proposed was based on the Soviet constitution established by Stalin in 1936 with integration of party and state and a highly centralised structure.[51] Naturally, the discussion about and around the constitution, and the nature of the regime, was taken up by intellectuals who tended to favour more freedoms rather than less. The CCP moved quickly to curb dissent by launching an attack on the well-known author and Party member Hu Feng for criticising the harsher aspects of Party control of art and literature. Hu Feng was arrested in 1955 and imprisoned as a counter-revolutionary. The campaign soon extended its scope and over 190,000 individuals made ‘voluntary’ confessions to avoid public humiliation or worse. This can be seen as setting the stage for the Party’s dealings with intellectuals and would lead to the Hundred Flowers in May – June 1957 (see Chapter 13).