Policy of Fighting for a Fundamental Turn for the Better in the Nation’s Financial and Economic Situation

The principles set forth in Mao Zedong's written report "Fight for a Fundamental Turn for the Better in the Nation’s Financial and Economic Situation” made at the Third Plenary Session of the Seventh CPC Central Committee on June 6, 1950.

In the early days of the founding of New China, after the fiscal revenues and expenditures was brought to a nearly balanced situation and the lending-borrowing interests tended to stabilize, new difficulties emerged, mainly manifested in the form of sluggish markets, the overstock of commodities, many private industrial and commercial enterprises, stopping or reducing production or even closing down, a large number of workers losing their jobs, and labor relations being strained.

Under such circumstances, new guidelines had to be introduced in order to unite and educate the people, isolate and attack the enemy, strive for a fundamental improvement in the state's financial and economic situation, and complete the task of restoring the national economy.

In his written report to the Plenary Session, Mao Zedong correctly analyzed the political and economic situation at home and abroad at that time, pointed out that the central task of the Party in the period of national economic recovery was to fight for a fundamental turn for the better in the nation’s financial and economic situation, and put forward three conditions required for the fundamental turn for the better in the financial and economic situation, namely. (1) The completion of agrarian reform; (2) Proper readjustment of existing industry and commerce; (3) Large-scale retrenchment in government expenditures. The fulfilment of these three conditions would take some time, say three years or a little longer.

At the same time, it was pointed out that eight tasks needed to be accomplished in order to achieve the above conditions: (1) Proceeding the agrarian reform step by step; (2) Consolidating unified control and unified leadership in our financial and economic work, balancing of budgetary revenues and expenditures and the stabilization of prices, readjusting of existing industry and commerce ; (3) Readjusting administrative organizations, and carefully conducting demobilization and restoration of some military personnel; (4) Carefully conducting reform of the old school education and of the old cultural institutions step by step, and winning over all patriotic intellectuals to the service of the people; (5) Carrying out earnestly relief for unemployed workers and intellectuals, and helping the unemployed to get work step by step; (6) Earnestly uniting with the democratic personages in all circles, helping them solve the problem of work and study, and overcoming any tendency towards either closed-doorism or excessive accommodation in united front work; (7) Resolutely rooting out bandits, secret agents, local tyrants and other counter-revolutionaries, all of whom were menaces to the people; (8) Strictly carrying out the Central Committee's directives on consolidating and expanding the Party organizations, on strengthening the ties between the Party and the masses, on conducting criticism and self-criticism and on launching a Rectification Movement throughout the Party.

The Third Plenary Session of the Seventh CPC Central Committee was an important meeting held at the critical moment of the transition from revolutionary war to peace-building. The tasks and strategic thoughts put forward in Mao Zedong's report and speech at this meeting were of great guiding significance for consolidating the victorious achievements of the people's revolution and thoroughly completing the remaining tasks of the democratic revolution, rapidly overcoming financial and economic difficulties, and restoring and developing the national economy.