8 - THE MARKET COMES FIRST: THE ECONOMICS OF DISENGAGEMENT AND THE ORIGINS OF REFORM

Summary

Following the Great Leap famine, Deng Xiaoping and Liu Shaoqi had promoted a package of reforms designed to relieve suffering in the countryside by pulling back from Mao's radical socialism, among them the retreat from fully collective agriculture entailed in baochan daohu, or the household responsibility system of farming. When Deng and Liu were removed from power during the Cultural Revolution, their reforms were systematically attacked by Maoists, who attempted to eliminate all individual farming and reemphasize the collectives. Following Mao's death in 1976, Deng effectively took control of the party-state. Many scholars have linked the emergence of market forces in post-Mao China to the agrarian reform announced two years later at the Third Plenum of the Eleventh Party Congress in December 1978, when the Deng Xiaoping leadership dealt a decisive blow to Maoist remnants. Minxin Pei's celebrated version of this interpretation claims that the momentum for reform came from mass pressures to escape the economic deprivation of the commune system and from government encouragement of a reform program that China's rural dwellers transformed into their own household responsibility system, a system that opened the door to decollectivization, private business, and market entry.

To a certain extent, this interpretation is correct, because village-based farmers did shun the artificial collective and return to private farming after the Great Leap famine, and this spontaneous and instinctive process led naturally to village markets and rural-based market fairs.