On State Capitalism Economy

Mao Zedong's comments on a document of the National Conference on Financial and Economic Work on July 9, 1953 clarified the nature, purpose, significance and other fundamental issues of the state capitalist economy in the transitional period, which is the concentrated embodiment of Mao Zedong Thought on the state capitalist economy. It was included in Volume 6 of Collected works of Mao Zedong.

In his comments, Mao Zedong pointed out that the vast majority of the capitalist economy in China's transitional period is under the management of the people's government, which is connected with the state-owned socialist economy in various forms and supervised by workers.

It is not an ordinary but a particular kind of capitalist economy, namely, a state-capitalist economy of a new type. This state-capitalist economy of a new type takes on a socialist character to a very great extent and benefits the workers and the state. It exists not chiefly to make profits for the capitalists but to meet the needs of the people and the state. True, a share of the profits produced by the workers goes to the capitalists, but that is only a small part, about one quarter of the total. The remaining three quarters are produced for the workers (in the form of the welfare fund), for the state (in the form of income tax) and for expanding productive capacity (a small part of which produces profits for the capitalists).