Both Eliminate Capitalism, and Rebuild Capitalism

Mao Zedong's important thought on socialist "New Economic Policy" in his talks with Huang Yanpei and Chen Shutong on December 7, 1956, after the completion of socialist transformation.

In his talk, Mao Zedong pointed out: "At present, the basic nature of our free market is still capitalist. Although there are no capitalists, free market is paired with the market of state.” "It can also be considered that as long as the society needs, the underground factories can be increased. We can allow opening of large private factories and make an agreement that they will not be confiscated for ten or twenty years. If overseas Chinese invest in the mainland, they shall not be confiscated for 20 or 100 years. You can start an investment company and pay back the principal and interest. It can be state-owned or private. We can eradicate capitalism and rebuild capitalism again. Of course, it depends on the conditions. As long as there are raw materials and markets for the produced goods, we can do it.”

On December 17, 1956, the tenth day after Mao Zedong put forward the “New Economic Policy”, Liu Shaoqi had also pointed out in a conversation that "What's wrong with some bit of capitalism or small producers? It's good for the people.”

On December 29 of the same year, Liu Shaoqi again pointed out at the 52nd meeting of the Standing Committee of the National People's Congress: "Recently, Chairman Mao said at the meeting of the Federation of Industry and Commerce that underground factories should be turned into aboveground factories, legalize and regulate them as long as they operate in a lawful manner.” “Our country has more than 90% socialism, I don't think it's terrible to have a few percent capitalism, I don't think it's terrible, it's a supplement to the socialist economy.” On April 6, 1957, Zhou Enlai also said at the meeting of the State Council: "In China today, the mainstream is socialism, therefore giving some freedom to the individual economy can help the development of socialism, in my opinion, we can adopt this policy except the railways which is not easy to run, all the others can adopt this method.” "Large coal mines, should be run by the state, smaller ones can be run by small co-operatives and private individuals.” “They may also be allowed to run some privately run primary schools. Except for the army, we can allow a little freedom to every branch of profession so that they can engage private enterprise in industry, agriculture, commerce and education. Culture field can also have some private ownership, so that hundred schools of thought can contend. In the construction of socialism, it will be beneficial to have a little bit private ownership.”

Mao Zedong's thought of "both eliminate capitalism and rebuild capitalism” was an important theoretical achievement in the process of exploring socialist construction and had great significance for socialist construction and reform.