China has come a long way over the years politically, socially and economically. Right now, it is arguably the fastest-growing economy on the planet and this can be attributed to the foundations that were laid down by the likes of Mao Zedong. To better understand the moves that were made over the course of the 20th century, it is first important to look at the state at which China was at the time, along with the vision that the Chinese leaders at the time had for the country. This paper will focus specifically on Mao’s Great Leap Forward Policy, a move that was ambitious in more ways than one but spoke volumes about where China wanted to be, and what the various stakeholders were willing to do to achieve that objective. It will look at how this policy panned out, the impact it has on China and its people along with the influence that it has on China’s overall growth to this day.
Mao Zedong, also known as Chairman Mao identified himself as and was also recognized as a communist revolutionary. He would later be referred to as the founding father of the People’s Republic of China, which goes to show the amount of influence that he had at the time. Mao was the son of a wealthy farmer, but his background did not impair him from seeing that there was more to China than just farming and agriculture. He had a vision that China would become the undisputed world leader economically and with this vision in mind, he drew up a plan that would help his country achieve that.
Chairman Mao’s plan entailed enriching seven key sectors including the iron and steel sector, oil and gas, coal, electricity, railroad, water transportation, along with the nonferrous metals sector. This would be a ten-year plan that was not only capital intensive, but one that required an incredible number if human resources to see it come to a success. It is noted that Mao looked up to the Soviet Union as a template for executing his mandate under his rulership and this, in a way, allowed him to chart a specific path that defined him and his leadership during his time. The only downside to his move was that China, at the time, did not have as many monetary resources as he would have wanted, something that ended up in the forceful diversion of resources from the agricultural sector to the seven key sectors in Mao’s focus.
China’s Economy Before Chairman Mao
Before Mao, China’s economy rode on the agricultural sector. The nation was largely undeveloped, and basic amenities such as education and healthcare were a rarity, especially for citizens living in rural China. It is noted that the health situation was so dire that the life expectancy of the average Chinese citizen was 40 years old. Poverty was the order of the day. While the economy survived on agriculture, primitive agricultural methods were being employed, meaning that output was lackluster and the country never really achieved its full potential. Production needed to be modernized for the country to draw the full benefits associated with agriculture, and for the sector’s full potential to be achieved as well.
The vast size of China as a country also meant that there were very significant regional variations in economic performance, development and overall living standards of the involved parties. Cities such as Shanghai and Beijing were relatively modern, running off of a services-based economy while most of the rural towns and centers mainly relied on agriculture, which was not viable in any way. As such, living standards of people living in major cities and those living in rural areas differed significantly. It is also noted that in numerous occasions before Mao’s rulership, China underwent disruption and instability which adversely affected economic activity at the time. In the period between 1913 and 1927, the country disintegrated into regional warlords which not only affected the overall unity of the Chinese people but had a negative impact on China’s overall economic growth. Despite the immense potential that China had at the time, its economy never performed as people wanted it to, which was a major issue for concern for the different involved parties, Mao included.
Mao’s Great Leap Forward Policy
The Great Leap Forward was Mao’s crown jewel, a move that he felt would take China to a whole different level economically. It would be labeled as a social and economic campaign by the Communist Party of China (CPC) which Mao was the leader at the time. The goal was to rapidly transform China from an agrarian economy into a socialist society. This, according to Mao, would be achieved through rapid collectivization and industrialization. The moves were drastic, and never really allowed for the best possible results to be achieved in the end. The idea was good, but the involved parties never thought it through. It is also noted that the execution of the policy was not the best, and it ultimately led to very poor results in the end, what many have even referred to as one expensive experiment.
Figure 1: The Chinese per capita GDP from 1950 to 1978 (in USD billions, Purchasing Power Parity (PPP) basis).
It is noted that from the year 1958 to 1962, living standards in China fell by 20.3%. Additionally, from 1966 to 1968, these standards dropped by 9.6%. Compared to other nations such as Japan and the West, China was struggling. The figure below shows how it compared to Japan’s per capita GDP performance at the time.
Figure 2: A comparison between the Japanese and Chinese per capita GDP from 1950 to 1978 (In USD billions, PPP basis).
As mentioned earlier, Mao has opted to use the Soviet Union as a template for governance along with the implementation of the Great Leap Forward policy. This proved to be retrogressive as it not only oppressed the Chinese citizens who were designed to benefit from the move in the first place. The projected costs of the projects were surpassed within the first few years. The feasibility studies that went into these projects were incomprehensive, and they ended up costing the country a lot of money. While some sectors experienced growth, it was only marginal especially taking into consideration the billions of dollars that went into these projects. What made it even worse was that the majority of these funds were meant to be directed towards agriculture and agricultural activities. This meant that this sector was grossly underfunded, and it ultimately led to adverse outcomes that showed the bad side of the Chinese leadership at the time, specifically Chairman Mao.
The Impact of Mao’s Great Leap Forward Policy
The Great Leap Forward policy, although quite ambitious and very practical on paper, led to one of China’s biggest social and economic disasters. Even worse, the government tried to hide the happenings on the ground through widespread exaggeration of deceitful reports. Massive resources were diverted to be used onexpensive new industrial operation on very short order. Very little planning went into these projects, and very little was even known with regards to the viability of the projects, how much they would cost, along with how they would get to generate income once done. In turn, these industrial operations failed to yield any returns and the few that did, the returns were not enough to justify the investments that were made. Most importantly, the funds diverted, as mentioned earlier, led to a crippling agricultural sector. Food could no longer be produced, and this led to a drastic reduction in food output. Ultimately, millions of deaths were witnessed in what was dubbed the Great Chinese Famine.
It is noted that with Mao’s directive, agriculture, even at the grassroots level in rural China was affected. Private farming was prohibited and those who violated this directive were persecuted. Rural industrialization was now Mao’s key priority, but it never yielded the outcomes that Mao desired. Rural dwellers were subjected to social pressure and forced labor. Inhumane acts were performed, all in the name of making China an economically-competitive country among its peers. This proved to be the wrong formula for the organization. In the end, it is estimated that at least 18 million people died. Oppression was the order of the day, and soon, the Great Leap Forward policy became synonymous with terror, systematic violence and coercion. The deaths resulting from the implementation of this policy led to one of the deadliest mass killings in all of human history.
Figure 3: China’s real GDP from 1979 to 2017 (Percentage).
It was only after Mao that China was able to realize its full potential and achieve consistent growth. From Mao’s regime, it was noted that copying the Soviet Union was not the best approach or the best recipe for growth. Indeed, the industries in which Mao wanted to invest in would have played an integral role in rapidly transforming China. However, the approach that was taken was wrong and a different one needed to be embraced. It is because of the lessons learned under Mao that growth for the country was realized and is still being witnessed to this very day.
China After Mao
Right now, China is the fastest growing economy and has been since the 1980s. The average annual growth rate currently stands at 10% and remained consistently so from 1978 to 2005. In 2005, the country’s GDP reached the $2.225 trillion mark for the first time, and many scholars have attributed this growth to the country’s transition from a state-dominated planned socialist economy to a mixed-market socialist economy. The lessons drawn from the Maoist period prompted massive reforms in the enterprise, fiscal, financial, legal and governance systems in the country. The Chinese government needed to be able to flexibly respond to the issues that were being witnessed, along with the consequences that would be associated with these proposed changes. In the end, the changes paid off.
The industries which Mao had identified at the very beginning ended up defining China and its economy. Industrialization and urbanization were prominent and they continue to propel China’s economic growth significantly as time progresses. This is a process that has since influenced every single aspect of China’s culture, economy, and society as a whole. Eventually, China had to move from an agrarian economy into an industrialized economy. The transition might have been a lot smoother if Mao were not in the picture, but his involvement allowed for the proper foundations to be laid down, and for the right lessons to be learned as well. Ultimately, this allowed for the easier and more effective implementation of various Chinese growth strategies, following proper planning and proper market assessment as well.
The Chinese industrial revolution might have started 35 years ago, but Mao and his Great Leap Forward policy had a significant role to play in it. Currently, China is the world’s largest manufacturing powerhouse, producing close to 50% of the world’s major industrial goods. It overshoots the United States’ crude steel production by 800% and makes up for 50% of the global supply of crude steel. As for cement, China is responsible for 60% of the world’s production, while providing 50% of the world’s coal production as well
|GDP Growth Rate||1.5||1.6||2.4||1.4|
|GDP Annual Growth Rate||6.4||6.5||15.4||3.8|
|Gross National Product||824828.4||740598.7||824828.4||679|
|Gross Fixed Capital Formation||346440.8||318083.6||346440.8||80.7|
|GDP per capita||7329.09||6894.5||7329.09||132|
|GDP per capita PPP||15308.71||14400.90||15308.71||1526.4|
|GDP Constant Prices||900309.00||650898.8||900309.00||5262.8|
|GDP from Agriculture||64734||42173||65467||649|
|GDP from Construction||61808||41590||61808||181|
|GDP from Manufacturing||305160||222165||305160||2207.8|
|GDP from Services||469575||345773||469575||2212.7|
|GDP from Transport||40550||29556||40550||393|
Modern-day industrialization for China can trace its roots back to Mao’s Great Leap Forward policy. Mao had a clear vision for China, and he was right that industrialization would be the key to China’s growth. The only downside was how he went about implementing the policy. Had it been planned properly and executed perfectly, it is safe to argue that China would be in a much better place than it currently is. Industrialization defines China today, and Mao was right about that bit. However, agriculture still plays an integral role in sustaining the Chinese population and contributing to the country’s overall economic growth.
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