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Selected Works of Mao Tse-tung



We have now completed our discussion of economic work. Our economy is divided into the two large private and public sectors. The private sector of the economy includes agriculture, animal husbandry, handicrafts, cooperatives and salt undertakings. The public sector consists of the undertakings run by the government, the army, and the official organizations and schools. We have looked at all these things. We have not discussed commerce in the private sector since we still lack the necessary information. For the moment we have to ignore it. Now we must discuss the problems of finance. However, we shall not look at all of its aspects but just look at three questions: (i) the question of grain, (ii) the question of taxation, and (iii) the question of economizing.

Our finances depend on two sources, the people and ourselves. Financial work for the portion supplied by ourselves is basically distribution and supply work when the process of production by the three elements of the public sector of the economy is completed and becomes a process of distribution. The public sector of the economy is the primary foundation for our finances and supplies. It provided three-fifths of all finances and supplies during 1942. Thus our primary financial work consists of properly carrying out the distribution of the fruits of production in the public sector. We have already discussed this question at length as a supplementary factor when dealing with the public sector of the economy and there is no space to say more about the details here. It can wait for further studies. Now we must discuss the second foundation for our finances and supplies — the portion obtained from the people, namely grain and tax. There is also the question of economizing. This is related to what we get from the people and what we supply ourselves. It is a question related to the whole of the resources we already possess and to the correct distribution and use of the funds for running our undertakings. Therefore it is an important financial problem. The grain question referred to here is the grain tax alone and not all grain problems. This is part of the tax system. However, since it is related to all the needs of the army and government, and to the relationship of 80 to 90 per cent of the people of the Border Region with the Party, the Eighth Route Army and the government, it is worth specially setting it aside from the general question of taxation and dealing with it first.

More than 90 per cent of the 1,400,000 people in the Border Region are peasants. Landlords and merchants make up less than 10 per cent. Over half of these peasants have obtained a share of land and the other half have not yet done so. Why are we striving to the utmost to enable the peasants to develop agriculture? In the first place our aim is to enable the peasants to grow richer and improve their life. Secondly, we want the peasants to be capable of paying grain tax to help meet the needs of the War of Resistance. There is also a third reason which is that we want the peasants, after obtaining a reduction in rent and in interest rates, to develop agricultural production in order to be able to pay part as land rent to the landlords, and thus to unite the landlords with ourselves in the War of Resistance. We must only do one thing to achieve these three aims and that is strive to the utmost to enable the peasants to develop agriculture. The more agricultural production develops and the greater the amount of agricultural and subsidiary products tile peasants harvest each year, then the less the amount of grain tax paid to the government becomes as a proportion of their total harvest. We propose to levy an annual grain tax of 180,000 tan beginning in 1943. We intend to keep this amount as fixed in the following few years even if as a result of agricultural development the total amount of grain produced in the Border Region increases from its present level of around 1,500,000 tan. (Many comrades estimate that with better use of existing labour power, we can raise the total production of the Border Region to 2 million tan. All increases will thus accrue to the peasants, making them keen to work hard to develop their own production, and enabling them to improve their own livelihood and to dress and eat well.

All comrades throughout the Border Region must learn from the way the comrades of Yan'an county strive to work in the interests of the peasants, so that the peasants rapidly get richer. The richer the peasants become, the less they take exception to handing over a fixed amount of grain tax and the more they feel close to and inseparable from the Communist Party, the Eighth Route Army and the Border Region Government The peasant Wu Manyou of Yan'an county is clear proof of this. On 30 April 1942, the Liberation Daily carried the following report on him.


(Our special report.) Rural labour heroes appear one after another in the spring ploughing movement. In order to express their deep devotion to the Border Region, to consolidate the Region and to improve their own life, they display the spirit of labour to a high degree. Among them, Wu Manyou from Luilin district in Yan'an county is especially respected by most peasants. Every year his harvest of grain exceeds that of others by one-sixth. The two labour powers in his family farm over 120 mu of land. This year they opened up 35 mu of uncultivated land. He is already publicly recognized as a model labour hero by the peasants of the township. According to late news last night, the Reconstruction Department of the Border Region Government has decided to give him a special award.

(Our report from Yan'an.) For successive years the peasant Wu Manyou of Wujiacaoyuan in Second township, Liulin district, Yan'an county has been active in spring ploughing and grown good crops. Usually people get an average of 5 tou from every 3 mu; he gets 6 tou. Thus when the government issued the call for great efforts in spring ploughing he said; 'I have benefited from the revolution and I can never forget it. I truly love the Border Region and at the same time I work to improve my own life'. He redoubled his efforts at opening up new land and influenced the masses. He created an enthusiastic spring ploughing movement in his own village. All the peasants in Yan'an county know that Wu Manyou's township did the best farming this year. Wu Manyou originally planned to open up 35 mu. He had already opened up 15 mu before it rained, and he was even more active afterwards. He said: 'I can finish clearing the new land in ten days, and if there is time I'll exceed the plan'. As for his other l00-odd mu of cultivated land, some parts have already been seeded and some parts have already been turned over. All the inhabitants of Wujiacaoyuan, the village head, the head of the township, and the head of the district unanimously praise him as 'a model hero in spring ploughing'. Now the district government has applied to higher levels to reward him. On hearing this the Border Region Government also decided after practical investigation to give him a suitable reward as an incentive.

(Our report from Yan'an county.) During the spring ploughing movement many labour heroes have appeared, but in the final analysis who is best at growing crops? To clear up this question our reporters spent a month visiting various villages. Now they have found the model labour hero generally recognized by the masses. This model hero's name is Wu Manyou. This year he is forty-nine. He is well built and strong. Before the land revolution he was a tenant farmer. At that time he had to eat leaves and husks. He 'suffered hardship' [worked for ethers] by cutting firewood. The money he earned he had to pay as taxes to the local bad officials and rich gentry, and he himself usually went hungry. After the Land revolution, he joined the revolution. He was given a share of land on the hills, roughly 40 shang equal to 120-odd mu. Apart from this private land, he has actively opened up and sown uncultivated land in successive years, and he raises cows and sheep. Now all the hill land is cultivated and he has two bullocks, three cows and more than a hundred sheep. His prospects grow brighter and brighter. He has got married, and eats and dresses well. Last year after government examination his family status was raised from poor peasant to middle peasant. He often says: 'When I think of the past and then of the present, how can I forget the benefits, of the revolution and of the Border Region?'

(Our report from Yan'an county). Model labour hero, Wu Manyou, plants crops like any other peasant. Why does he reap more grain than others? According to the peasants in his village there are several reasons. First, he gets up earlier than anyone else and goes to bed later. Before the sky grows light he has fed his cows and gone up the hill. He only comes back from his land when the sky is dark. He can really endure hard work. Second, in winter when there is no work to do, he diligently collects manure. As he also can raise sheep and cows, he has more manure than others. On average he applies seven pack loads of manure to every 3 mu. Third, when the crops begin to shoot, some peasants are afraid to go up into the hills. They do not hoe the weeds or only hoe once at the most. He hoes twice at least, so his millet naturally grows well. Fourth, he plough deeply. Other households plough down 5 inches he ploughs down 7 inches at least. Fifth, when breaking up the earth, he breaks it finely and is not careless. Sixth, he always ploughs and sows at the correct time, neither early nor late. Because of these fine qualities, he harvests a top yield per 3 mu of 12 tou on the old scale (18 tou on the market scale} and a lowest of 4 tou (6 market tou ). The average is 6 tou (9 market tou). The average for other peasants is 5 tou (7 market tou). In terms of averages, he is one-sixth better than others.

(Our report from Yan'an county.) Model labour hero, Wu Manyou, is not only a model at growing crops but is also a model citizen. nest year he harvested 18 market tan of wheat (xiaomai) and 27 market tan of grains (equivalent to 16 tan 2 tou of hulled grains). He paid 14 tan 3 tou in grain tax, 1,000 jin of hay tax, contributed two lots of 150 yuan to government bonds, and paid 665 yuan cash substitute for the salt tax. The villagers said to him: 'Old Wu, you pay out too much, cut down a bit! He said 'During the revolution, the Eighth Route Army protects our Border Region. People at the front loose blood. All we have to do is sweat a little more. How can you say "Too much"?' Afterwards everyone respected his opinion and enthusiastically gave grain to the State. This year the upper levels moved some refugees to live in the village. He lent grain and hoes to them and helped them find uncultivated land. He also often encouraged them materially and in spirit to open up and plant land. Usually he is also the most fair person in the village. His prestige among the ordinary people is very high and everyone trusts him. In May last year he was elected a member of the township council and director of the township's work in supporting families with dependents fighting in the War of Resistance. He has a younger brother who is a soldier with the Eight Route Army, so he himself belongs to such a family but he declined public support. He said: 'Fighting is the duty of the Chinese people, there is nothing strange about it. I've enough to eat, what other support do I need?' However, he is extremely correct towards other families in the township with dependents at the front. At the same time he is very fair in his distribution of labour duties. There are twelve families in the township with dependents fighting in the war. This year he arranged substitute farming for 220 mu and all the families were grateful to him. No one in township says he is not good.

(Our report from Yan'an county.) There are fourteen peasants sent households in Wujiacaoyuan with fourteen heads of family. When you raise the question of whether Wu Manyou is worthy of being called a model labour hero, everyone raises his thumb and says 'What else can be said about old Wu. He is the best at enduring hardship. If he isn't a hero who is fit to be?

On 2 June there was another report in the Liberation Daily.

Because of the influence of the labour hero, Wu Manyou, Wujiacaoyuan which originally planned to open up 147 mu of undo cultivated land, had already opened up 225 mu. Wu Manyou himself opened up 15 mu. After Wu Manyou was rewarded the whole town ship (Second township, Luilin district) opened up 540 mu.

On 29 October, the Liberation Daily carried a further report.

This year the harvest of coarse millet is very good. In Wu Manyou's village the yield per 3 mu is in general 5 to 6 tou but he has got 8 tou (each tou is the large kind equivalent to 45 jin). Most peasants get 3 or 4 tou of hulled grain from husking 1 tan of coarse grains. He always maintains the official standard for the equivalent amount of hulled grain. Wu Manyou often puts on a propagandistic air and says to others: 'If you want to get your crops as good as mine, learn from me! I have no secret, I am simply willing to labour' .

Wu Manyou is already a rich peasant. Because he got benefits from the soviet government in the past and the Border Region Government now, he has united his destiny with that of the Communist Party, the Eighth Route Army and the Border Region Government. All empty words are useless, we must give the people visible material wealth. The minds of many of our comrades have still not fully turned into the minds of communists. They only know how to do one kind of work, asking the people for this and that, for grain, for hay, for taxes and for mobilization for various kinds of work. They do not know how to do the other kind of work, striving to the utmost to help the people develop production and to improve their cultural level. It is entirely rational for us to ask things of the people for the sake of the revolution and the War of Resistance. It is good that our comrades consider that in doing this work they are doing the work they should do for the revolution. But it is only doing one aspect of work and it is not the primary aspect. The primary aspect of our work is not to ask things of the people but to give things to the people. What can we give the people? Under present conditions in the Shaan-Kan-Ning Border Region, we can organize, lead and help the people to develop production and increase their material wealth. And on this basis we can step-by-step raise their political awareness and cultural level. To these ends we must endure all discomforts and night and day, diligently and thoroughly look into the people's problems in their livelihood and production, including such important matters as plough-oxen; agricultural implements, seeds, manure, water conservancy, animal fodder, agricultural credit, immigration, opening up new land, improving agricultural methods, female labour, labour by loafers, plains for setting up households, cooperatives, exchange-labour teams, transport teams, textiles, animal husbandry, salt industry and so forth. Moreover, we must concretely help the people to solve these problems and not use empty words. This work is the primary work for all Communist Party members working in the countryside. Only after we have done this aspect of work and achieved real results can we get the people' s support when we do the second aspect of our work which is to ask them for things. Only then will they say that our requests are necessary and correct. Only then will they understand that if they do not give grain, hay and other things to the government, their life cannot be good and cannot get better. Only in this way will our work not be done through coercion. Only in this way will things run smoothly, and only in this way will we be truly united with the people. This is the basic line and policy of our party. Every comrade (including those in the army) should study this thoroughly. Only when our comrades understand and carry out the complementary nature of these two aspects of work, can we call ourselves all-round communist revolutionaries. Otherwise, although we do revolutionary work and although we are revolutionaries, we shall still not be all round revolutionaries. Furthermore, some comrades are still bureaucrats remote from the masses. Because they only know how to ask the masses for things and do not know how to or are unwilling to give things to the masses, the masses detest them. This question is extremely important. I hope everyone will pay great attention to it and propagandize the principle throughout the whole party.

In what follows we shall sum up our past experience in grain work and point out the policy for 1943.

From 1937 to 1939, the grain tax levied in the Border Region covered only a part of supplies. The deficiency each year was made up by purchase using funds issued by the government. With the exception of particular areas and periods when there were grain difficulties, there were no insurmountable problems in the whole of grain supply for the four years. During that time we actually enabled the people to build up their resources. The burdens of grain tax were heavy on the rich peasants and landlords, very light on the middle peasants and most poor peasants had none at all. In 1940 outside aid was cut off and the government had no resources to buy grain. We had to turn to raising all of it in tax. However, the principle of 'calculating tax on the basis of income' had not yet changed. Also the grain tax for 1940 was raised to only 90,000 tan and the policies for collection were not altered. For supplies in the following year (1941) we put forward the policy of 'strengthening grain administration and ensuring grain sufficiency'. However, we could not provide all supplies since we had not levied much grain in 1940. There was also the related matter of achieving self-sufficiency in running costs in 1941, in connection with which the various army units and official organizations paid careful attention to grain in order to solve problems in livelihood. Another factor was that since the organizational structure of the departments doing grain work was not yet strong and the quality of the cadres was not good enough, the various regulations were not well established and we could not fully control grain income and expenditure in all places. At the time the problems of making excessive returns and rash leadership were very serious, was constantly changing, increasing and decreasing, and was too much occasional expenditure outside the set amount. The grain tax levied in 1940 provided supplies until March 1941, when some places already had nothing to eat. Before long there was a panic over grain everywhere. It was only by successively buying grain once and borrowing twice that we lasted until November. In order to guarantee supplies for 1942 and to repay loans taken in 1941, it was estimated that a levy of 200,000 tan was essential. At this time the problem of grain had already become the most serious financial problem. After repeated study by the Party and government and under the new principle for collection of 'calculating tax first on the basis of our expenditure and second on the basis of income', it was decided to levy 20.000 tan of grain and 26 million jin of hay. To ensure collection of this amount of grain and taking the interests of all social strata into account, the base for collection was expanded. The burden on the middle peasants was increased and the poor peasants began to bear some of it. We corrected the earlier of bias towards the minority of wealthy.

The grain accounts at the various county granaries were not clearly kept in the past, and the great muddle in the formalities for buying and borrowing grain during 1941 had increased the difficulties of sorting them out. The Grain Office was deeply afraid that the lack of clarity over the old grain would influence the new. Therefore 'grasp the new grain, ensure supplies was made the strategy for work in 1942. Events during the year showed that although there were deficiencies in implementation, the policy itself was entirely correct. Grain tax for 1942 was reduced to 160,000 tan and hay tax to 16 million jin. The policy for collection also reduced the burden on the poor peasants slightly. Furthermore, we are preparing to implement a unified progressive agricultural tax in 1943 in place of the grain-tax method. In order to raise the peasants' enthusiasm for production, we lent them some of the grain and hay during 1942 to help them solve problems during spring ploughing. In supply work the thing is to concentrate on grain and hay.

As regards the work of collection, we only levied 10,000 tan in 1937 and 1938. The burden on the masses was very light and everyone was willing to pay. In 1939 the amount was raised to 50,000 tan. The government proclaimed new regulations for collecting the grain. Work groups were sent down to the countryside to make surveys and to collect tax according to the regulations. However, in reality, 50,000 tan was still a very slight amount of grain tax for the masses to bear. The cadres were used to the method of democratic apportionment of taxes and the survey work was very perfunctory. The so-called collection to regulations remained a theory. In 1940 it was just the same. Only in 1941 when the grain-tax burden suddenly increased to 200,00 tan did the government again seriously revise the regulations. The Finance Department sent large numbers of work groups to the counties to work with the county and district governments in carrying out fairly thorough-going surveys so that the masses' burdens were made rational. This grain collection emphasized 'thorough-going surveys' and 'carrying out the regulations'. Summing up collection in 1941, there is clear proof that if good survey work is done, it is easy to carry out the regulations. For example, Ganquan county was very conscientious in making surveys and then implemented the regulations and rates for collection. Quzi county carried out three surveys and was able to ensure a fair and rational distribution of the burden. In Baima district of Huachi county the requirement was not filled after two allocations. Eventually the head of the grain collection work group, Comrade Wang, himself surveyed one township to get experience. As a result the whole district over-fulfilled its quota by several tens of tan. In places where survey work was poorly done, such as in the special military area, the regulations could not be carried out. In general county cadres still treated survey work too lightly. Only a minority of them carried out thorough-going surveys for grain collection in 1941. The majority still used the old method of democratic apportionment of taxes. In 1942 the grain collection gained from the experience of the previous year. The regulations were revised again to bring them more in line with reality. More thorough surveys were undertaken on the basis of the surveys carried out in 1941. The Finance Department issued instructions that the cadres collecting the grain had to follow the regulations. In cases where carrying out the regulations meant that the task could not be completed, they could also use the method of democratic apportionment of taxes. At the same time, during this collection the cadres were given ideological education which overcame their previously crude work-style and backward conduct such as following personal preferences and holding things back. According to recent reports from Longdong there is once again proof of the importance of thorough-going surveys for the implementation of regulations. One district in Qingyang county carried out a thorough survey, and because much new land was cultivated during the year and production increased, it was able to exceed the original collection target by several hundred tan in line with the regulations.

A further point to consider is that for several years the figures set for the grain collection have been achieved and exceeded, but the work of putting the grain into the granaries has been too muddled. Many cadres involved in grain collection think that they only have to meet the target. They do not consider quality or investigate delayed payments. As a result on one hand the quality is not good enough with 15 to 20 per cent consisting of husks in some cases, and on the other there are instances where the masses delay in paying their grain. There is a difference between the amount collected and the amount put into the granaries. In the 1941 collection, although the quality was a bit better, there were still a lot of husks mixed with the grain. The slogan 'Grain to the Granary and Hay to the Cellar' was put forward to overcome the problem of late payment but there was still too much of it. In addition, because the 1941 collection was much bigger than any previous year, the difficulties of getting it into the granaries were much greater. As a result over 3,900 tan of the grain collected did not go into the granaries. This was nearly 2 per cent of the total. During the 1942 collection the problem of getting the grain into the granaries was specially emphasized. According to the latest examination this work has been done a little better this year. However, the question of whether the full total had been put in the granaries or not awaits a final summary before it can be answered.

Another point is that for several years the Finance Department has assigned work groups to help the county and district governments in the grain-levy work. Where county and district cadres are too weak, this method is of great help. Its shortcoming is that it easily creates dependency in the lower-levels of government, and every time there is a mobilization, the upper levels have to send people. The cadres have to go back and forth, spending much time on the road, which leads to waste of manpower and of time. Since collection in 1942 had the good foundation of work done in 1941, the Finance Department adopted the principle of 'fewer and better' in its assignment of work teams. It sent fewer cadres to each county and increased the responsibility of the county and district government. In 1941, 150 people were sent down. On this basis they are preparing to move towards not sending down anyone at all, handing all the grain collection work over to the county and district governments.

As regards supply work, because general income and expenditure was not firmly controlled in 1941 so that grain had to be bought once and borrowed twice, and because mobilization were hurried and almost cruel, the masses were not satisfied. This was a great shortcoming. In 1942 we were able to control income and expenditure. we also had the 200,000 tan of grain levied in 1941 as a guarantee to ensure supplies until December. However, since the drive for better troops and simpler administration was not thorough, the budget could not be strictly implemented. Occasional expenditures combined with unpaid grain tax came to over 18,000 tan. In addition, troop movements influenced the relationship between supply and demand in various places, and grain balances in the first half of 1942 could not be maintained as allocated. Therefore, after July places like Yan'an, Nanniwan and Linzhen one after another became short of grain. Afterwards the Finance Department issued supplementary funds of 2 million yuan to buy grain and a summer collection was made. Only in this way was a grain panic avoided during 1942, and there was no bad effect on the masses. Next, for the grain in 194 we adopted the method of 'allocation as a whole and divide' administration'. Although this saved the bother and waste of transport to and fro, it brought about cases of uncontrolled selling of grain, which also entailed a lot of waste. There was still a gap between the amount collected and the amount needed for supplies, which also led to many shortcomings. For example the grain and hay allocated to the various counties in 1941 was biased towards the harvest situation and neglected the supply and demand situation. The grain requirement in Sanbian for the year was over 10,000 tan but only 1,600 tan was collected. A supplement of 9,000 tan had to be transported from Longdong, Ansai, Zichang, Zhidan and so forth. Not only was the year's grain transport work excessive for the masses of these counties, but the masses in Sanbian were also very busy handling transshipment. They called out that 'this way is not as good as collecting more from us'. It is now estimated that just the 4,000 tan of grain moved to Sanbian from Longdong cost 7 million yuan to transport, which is more than the cost of buying grain in Sanbian. Another example was the grain collected in Yanchuan. Originally it should have supplied Yan'an. However in 1941 grain from Dongyang district was collected at the Majiapan granary which is on the opposite side of the county near the Yellow River. As a result it took an extra three days to transport the grain to Yan'an. Quite a few similar situations arose in other counties. Again, the plan for the 1941 hay collection was not thoroughly researched. It was decided everywhere to collect the hay after the grain and no attention was paid to supply and demand. As a result some places kept hay for which there was no use and it was allowed to go rotten which dissatisfied the masses. In other places which needed a lot of hay there was an exceptional shortage and supplies were only enough for eight months. Another example was the 1941 grain collection in Guanzhong. Millet was made the unit instead of wheat. The peasants had to go out of the Border Region tp sell wheat and buy millet in order to pay the tax. As a result too much millet was collected, the troops were not used to eating it and there were many disputes. After summer begins millet rots easily which added to the troubles. Again in 1941 the relative proportion between regular and miscellaneous grains was generalized, and not reckoned according to the grain production circumstances or the relationship between supply and demand in each place. As a result some places (such as the special military area ) collected a lot of miscellaneous grain which could not be issued. Some places (such as Yan'an) needed horse fodder but could not get miscellaneous grains. The official organizations had to lower the relative proportions and exchange hulled grain for miscellaneous grain which in turn led to waste of grain. The above shortcomings illustrate that grain work is very concrete and meticulous, practical work. If it is done crudely and in a way divorced from reality then the results will disturb the people and disrupt the government. In 1942 after the grain collection work was handed over to the Grain Office, the management of grain collection and supplying was united. At the same time as a means of balancing resources, it was decided to accept a money substitute for the hay tax according to the different supply-and-demand situation in each place. As for the relative proportions of grains, the earlier way of generalized application was changed into a system of deciding according to the concrete situation in each place, thus overcoming the previous shortcoming.

Next, from the winter of 1941 up to the present quite large successes have been achieved in setting up and consolidating systems for grain supply. As regards the budget system, for example, in 1942 most official organizations were able to draw up their budgets at the correct time. They have got rid of the bad practices of claiming excess grain and eating double rations, and corrected the situation where counties approved budgets haphazardly and spent grain without control. In particular they have grasped the policy of 'the final account must not exceed the budget'. During 1942 they have conscientiously cut down on all irrational expenditure, economizing on over 19,000 tan of grain. As regards the system for paying out grain, most army units and official organizations have honoured the regulations that grain cannot be paid out without a grain payment document. The responsible comrades in the counties have also paid attention to this regulation. They have not indiscriminately permitted loans from tax grain. At the same time during 1942 all the counties have used the official tou measure which considerably reduced the number of disputes. As for the granary regulations, because of the cadres' limitations, these could only be strengthened first in the central granaries and then gradually generalized to all granaries. For keeping accounts, the Finance Department drew up two standard account-books (one new-style and detailed, the other very simple) which were adopted by the cadres according to their ability. In 1942 most granaries, good and bad, had account-books. Gradually we can reach the goal of being able to obtain at any time statistics for grain income, expenditure and the amounts and kinds of grain in store. As for the grain coupon regulations, there was much corruption in 1941 because we issued large numbers of coupons. In 1942 we abandoned the old grain coupons and issued three kinds of meal-ticket which were only supplied for circulation among personnel in the official organizations to cover meals. This was a step forward.

However, there were still many defects in the grain-supply work. For example, a minority of large units still could not draw up their budget at the stipulated time. A comparison of the actual personnel totals and the budgets of various large units showed that there was still quite a proportion of figures without foundation. Some instances of taking double rations still occurred. The ratio of livestock was not clearly laid down, which in some cases led to quite a lot of waste. Instances of individual troop units insisting on grain loans from granaries because they had wasted grain and overspent could still not completely be avoided. As for the storage system, most granaries still only managed to do the work of receiving and paying out grain and of administration. They were not good enough at supervising collection, safe-keeping, submitting accounts and other duties. The meal-tickets could not be circulated among the people, which caused problems for personnel sent to do outside tasks. This too was a shortcoming. Finally, there was a great defect in building up and consolidating all regulations which was that the Grain Office only emphasized its own regulations and difficulties. It could not comprehensively and concretely concern itself with solutions to the problems and difficulties facing each official organizations.

In 1942 the official organizations in charge of grain were very successful in the work of clearing up the granaries' old grain accounts. For several years the county grain accounts had not been examined and reckoned up, so that the Grain Office's accounts were no longer any use. For example, according to the Office's accounts, in the winter of 1941, Ansai should have had over 2,900 tan in store. In fact it had less than 100 tan. Again the account for the grain taken from the granary by the sanitarium had not been worked out for five years. It was discovered in 1942 that it had collected over 100 tan too much. There were many cases like these. Compounded by the muddle over purchases and loans in 1941, many counties had no accounts to be examined. As a result the Grain Office sent cadres down to each place to work out the accounts and adopted all kinds of accounting methods. The old granary accounts were only cleared up after six months' hard work. Now the Grain Office is able to work out how much grain is actually held by the granaries and can keep a hold on grain income and expenditure. The counties' administration of grain was also previously very poor with losses due to a combination of rats, insects, rotting and so forth. In addition there was serious corruption among the cadres. During grain collection in 1941, there were more than ten cases. It had even gone so far that individual special agents had infiltrated granary work. For example, Zhang Bingquan, the director of the granary of Taile district in Fuxian, was a special agent. In February 1942 he embezzled over 10 tan of public grain and fled from the Border Region. This shows that previously the Grain Office's supervision of granary cadres was too lax and its inspection work too infrequent. Since the granary accounts were cleared up in 1942 and the leadership of the granaries by the five sections of government at county level was strengthened, corruption and waste have been reduced and many active and hardworking cadres have been discovered.

In carrying out collection policy in the two years 1939 and 1940 the regulations were fixed so that the tax threshold began at 1.2 tan (that is, peasant families whose harvest per person was less than 1.2 tan were not taxed). Tax was progressively applied to a top level of 36 per cent (that is, the tax rate increased until it leveled 36 per cent of the harvest and thereafter the percentage did not increase). The failing here was that the tax burden was biased towards the minority of the well-off. At the same time the method of collection was that of democratic apportionment of taxes and not that laid down by the regulations. As a result, there were cases of going for big households' and 'ignoring everything but the target'. Also the collection policy was influenced by excessive 'Leftism. 1941 the regulations were revised. The tax threshold was fixed at 0,5 tan (for example, a family of five whose annual harvest of regular grain was less than 2.5 tan was not taxed). Taxation was progressively applied up to 30 per cent. The implementation of these regulations resulted in a broadening of the base for collection. Apart from Huanxian which suffered natural disasters, the tax burden in all other counties was carried by over 80 per cent of the people and in Yan'an county it reached 95 per cent. In terms of carrying for the interests of all classes and strata, with the exception of Yan'an, Yanchang and Ansai, the burden in other counties did not exceed 30 per cent of the harvest. However, there were still shortcomings. For example, the counties were not entirely rational in their allocations to meet the total collection. The special military area lowered the tax threshold to 0.3 tan and reduced the number of steps in the tax progression. As a result the poor and middle peasants suffered and the richer middle peasants and above were let off too lightly Also, during grain collection in 1941 we only paid attention to collecting grain and not to reducing rents and interest rates at the same time. Some new immigrants who should not have paid tax had to do so. Family dependants of troops in the War of Resistance should have received special assistance but this was stopped in some cases. Some cotton-growers should not have been taxed for grain but were. All these things contravened the government's pollicies. Other policies such as caring for the interests of all strata, raising the enthusiasm or production of the peasants and so forth merely remained general slogans. Actual implementation was very deficient. With the experience of 1941, the grain collection in 1942 made some advances. However, we still did not pay enough attention to the cotton-growing policy. For example, the allocation of a quota for grain tax to the cotton-growing areas in the three eastern counties was the same as that allocated to other counties. When it came to collection, problems arose. If grain tax was not collected on the cotton fields the requirement could not be fulfilled. Yet if it was collected, it would conflict with government orders. Ultimately they had to make accommodations and reduce the collection by half. This still damaged the authority of the government.

In any work, going beyond policies depends on whether the cadres are good or bad. Grain work is no exception. The most hardworking people doing grain work are the granary cadres. The easiest corrupted are also the granary cadres. Therefore we shall here specially quote examples of typically good and typically bad granary cadres, so that everyone can learn from the good and be warned by the bad.


(A) Comrade He Chuango, director of Panlong granary is an old fellow of fifty-two. He does not say much but is very careful and thoughtful, enthusiastic and hardworking. In 1939 he was assigned to work in the Zhenwudong granary of the Grain Office. In 1940 he was transferred to be director of the Panlong granary, concurrently responsible for the grain-market balancing station [diaojizhan] and the transport station. He is responsible for the work of three men. In the past he has been secretary of a district Party committee and has been trained at the Border Region Party School. Initially he was one of seven people including Jia Zhicai and Ren Shengbiao who were assigned from the Border Region Party School to do grain work but of these he alone remains at his post today. His cultural level is not among the lowest of the granary directors. He can write simple letters and keep clear accounts. He is very conscientious in studying the newly adopted account books and learns quickly. In 1941 when the 'monthly report tables' were issued to the granaries some directors could not understand after three days of explanation. After hearing once he was able to raise questions and opinions. After a few questions like 'What should be filled in on this section?, Would it be all right to fill in that section like this?', he could complete and send in his 'monthly report tables' on time. Many fine qualities are expressed in his work. The first is meticulous attention to detail. When receiving grain he writes a receipt for the amount and makes up his accounts every evening. When paying-out he double-checks on the abacus. The second is a deep sense of responsibility. He takes great care of the granary. One storage bin was a little damp and he paid special attention. He often had the grain spread out to dry in the sun, and when paying-out grain he always paid from this bin first. Eventually he dug a ditch behind the bin and dug the surface of the earth around the bin lower than the bin, making it a little drier. When the granary needs minor repairs he does not hire workers but sets-to himself to carry bricks and plaster ( under his influence the personnel in charge of moving the grain also work hard and help). As administrator of the transport depot, every time a transport team arrives he helps to cut grass, draw water and prepare food. His third quality is his friendly attitude to others. Some of the personnel in leading official organizations get in a bad temper when the grain is paid-out, but he patiently finishes the job and does not get into arguments. Sometimes some of the masses send bad grain when paying-in. He just encourages them to take it back. When buying grain to balance the market, he can discuss things and get close to the masses. But he also has his own opinions. Once when it was raining and the grain in the market could not be sold, he took the opportunity to purchase it. The price was fairly low and the masses were still pleased. For these reasons he enjoys some prestige among the masses of Panlong. When receiving tax grain in 1941 a peasant from Yongping district county offered him bribes. He got angry and sent the man and the goods to the district government. His fourth quality is a plain and simple way of life. He raises very few questions about his own life and he expresses concern about receiving welfare expenses. In 1942 he was responsible for collecting 4.000 tan of tax grain and everyone was concerned that he might not manage since he is old and has few helpers. But every time he wrote a letter to the Grain Office, he said that he could manage.

(B) Comrade Bai Heming is director of the Tianzhuang granary in Suide. He is a graduate of upper primary school. He had worked in the old baojia office. His qualities include first a deep sense of responsibility. When receiving grain he compares receipts and invoices every evening to make sure that there has been no mistake. He also makes out clear accounts for households owing grain, and supervises the districts and townships, encouraging them to send in their grain. Before receiving grain, he himself lays stones and boards in the storage bins, spreads dry straw and puts straw mats over the straw so as to guard against dampness. After the grain is in store, he himself seals up the bins which will not be opened soon, using bricks and plaster and covering-up holes which let in the wind, with broken mats. Secondly, he is friendly towards others. When receiving grain he inspects conscientiously. However, to those who send in bad grain he simply says: 'Look everybody, can you feel easy about sending grain like this for the troops?' He has never raised his voice in abuse. If someone from the army came to collect grain not in accordance with official procedures, he always courteously and patiently explained things. On the one hand he would lend some grain to prevent shortage, and on the other asked the them to make good the procedures. Before long if anyone from the troops stationed in Suide went to collect grain from old Bai's granary, they always went through the procedures to avoid difficulties for old Bai and embarrassment for themselves. Thirdly, he is very hardworking. He gathers firewood and draws water himself. He is careful over operating and food costs. He reports excess expenditure to the fifth government section at county level. He does not indiscriminately take grain and sell it for the cash to make up deficiencies. Now Comrade Bai Heming has been promoted to be head of the fifth section of Suide county government.


(A) Hy Dianchang was director of the granary of Fourth district Xinning. When receiving grain in the winter of 1941, he sold 3 tan privately, took 1.3 tan home, and lent 3.92 tan to his relatives and friends. He himself and his relatives and friends, Hy Diangong, Hu Qingrong and Liu Zixiao should have paid 7 tan of grain tax. They did not hand over a single grain but he still issued tax-grain receipts. When receiving grain he did not allow the masses to sweep up the grain on the floor, but swept it up himself and shared it with the personnel helping him to receive the grain. After he had finished issuing tax-grain for deposit in citizens' homes, he was 0.2 tan short but he falsely reported 1 tan to the fifth section of the county government. After the fifth section found him out, he was sent to court, sentenced to prison and ordered to return the embezzled grain.

(B) In September 1939 after grain was sold from the Shuifan district granary in the Huachi county, 14.7 tan of tax grain was missing. The granary director, Wang Wenbin reported to the upper levels that rats had eaten 12.7 tan and another 2 tan had been contaminated. In 1941 when the grain collection work group went to investigate, they discovered that Wang Wenbin had gone to the county town for a meeting during the time when the grain was sold. His place had been taken by the district secretary Mao Yupeng. During the grain sales Mao Yupeng had lived exceptionally richly. He had bought a flock of sheep and two skin coats. He had also bought cloth. There was suspicion of embezzlement. However, at the time the county government did not investigate. Afterwards Mao Yupeng was transferred to work elsewhere. This affair is still going on.

Above we have summed up our experience in grain work during the past five years. Below are the policies for work in 1943.

(1) Implement the unified progressive agricultural tax. In the past we have used the method of levying national salvation grain tax. It is not an entirely satisfactory method of taxation. If it is well done it can only achieve the aim of being fair burden on the people. It cannot give any effective encouragement to the peasants' feelings towards production. Therefore we must actively prepare to implement the unified progressive agricultural tax. How should our preparatory work be done? (i) Under the leadership of the Finance Department set up a specialist research team consisting of five to seven cadres selected for their experience in political work and their good understanding of land and financial problems. This team should gather, study and arrange materials concerning progressive taxation, and plan the work for introducing it. In addition, directed by the Border Region Government, responsible comrades from the relevant official organizations led by the head of the Finance Department should organize a planning committee to take charge of policy, to solve problems and to regularly lead the work of the research team. (ii) Carry out survey work. A detailed summary of grain collection work in 1942 should be supplied to the progressive taxation research team as concrete source material. The research team should first study some counties with different situations, whose collection in 1941 and 1942 was comparatively good. They should draw up an initial survey plan, and first carry out trial surveys. Afterwards they should revise the plan, draw up a format and carry out a general survey. In the light of the materials from the survey they should determine the regulations and methods. Counties with good successes who complete the work early can carry out a trial run during 1943. (iii) Carry out land registration at the same time as the surveys. (iv) Strengthen the government organization at township level, build up sound clerical records and survey thoroughly.

(2) Grasp grain and hay, ensure supplies. Supplying grain and hay is complex and detailed work. Grain and hay resources are widespread and not easily grasped. If we are unable to pay full attention at all times and cannot suitably adjust the relationship between supply and demand, it will be hard to make a good job of it. If we want to be able to grasp grain and hay and ensure supplies, we must do the following: (i) We must first ensure that all the 160,000 tan enters the granaries, and improve the quality so that 100 per cent is grain. Do not allow adulteration with husks. At the same time, call on all counties to eliminate evasion of payment. We must build up thorough regulations for the administration of grain and hay. Pay attention to the running and inspection of granaries. Set up central granaries. Gradually improve equipment. Prevent damage through contamination and rotting, and corruption and theft. Strictly carry out the budget system. Completely eradicate excessive claims and taking double rations. Set up grain accounts in accordance with the cultural level of the cadres in each place. Do not be too elaborate but require that receipts, issues and stocks of grain are clearly recorded. Next, the regulations for paying-out grain are even more important and must be carried out. The reason for building up regulations soundly is to ensure supplies and to prevent corruption and waste. All instances of not adhering to discipline must be strictly corrected. However, a mechanical viewpoint which one-sidedly emphasizes regulations without concern for the concrete facts must also be guarded against. (ii) To ensure supplies, we must first handle the relationship between supply and demand of grain and hay. Prepare supplements for areas deficient in grain through transport, adjustment of distribution and so forth. In 1943 we should organize any unused animals owned by the official organizations to transport grain and hay, improve the work efficiency of every transport team (on average our animals each carry 1 tou less than those of the common folk and we need three days to go as far as they do in two) and lay down precise transport tasks so as to economize on manpower and animal power which can then be used for production. We must depend on the grain transported by the people, making plans early and using the slack agricultural periods and unused porters and animals. Except in special circumstances, mobilizing transport in the busy agricultural seasons is not allowed. Long distance transport must also be avoided as much as possible. In areas where the distribution of grain can be adjusted, coordinated plans should be made by the Grain Office. Grain should be sold or bought at the right times so as to supplement supplies, save on transport and avoid waste. In areas where official organizations and schools are excessively concentrated such as Yan'an, we should consider the situation, and disperse men and horses to ease the distribution of grain and straw.

(3) Carry out the drive for better troops and simpler administration, store grain to prepare for famine. For successive years the Border Region has overdrawn its tax grain and has not got the slightest reserve. If natural disaster occurred, grain supplies for the army and people would become an extremely serious problem. Everyone should be warned by this to take the following steps: (i) Resolutely carry out the new reorganization plan of the Party and government and the drive for better troops and simpler administration. Through simplification and strict economy ensure a balance between grain income and income and expenditure in 1943. (ii) Collect 180,000 tan of' tax grain in 1943 so that we have a chance to retain some as reserve against need. (iii) During 1943 the troops, official organizations and schools should put developing agriculture in first place. Growing grain should form a considerable proportion of farming work so that there will be an even greater surplus in 1944 and we will be prepared against disaster. The troops, official organizations and schools certainly may not relax their own grain production because we are preparing to levy 180,000 tan during 1943.

(4) Strive to economize, strictly prevent waste of grain. There is a serious waste of grain among the official organizations and troops. Thus, mounting a campaign to economize should be one of our central tasks for 1943. Recently in Yan'an some of official organizations and schools have inspected the amount of waste and carried out economy campaigns with great success. For example, the administrators of a training squad in the supply department of the garrison forces were diligent and responsible. When issuing grain and flour, they did the weighing themselves. Thus their food supply was just right and they were often able to eat buns and noodles. The Central Party School has large kitchens. Recently administration of food has been strict. Grain-cooking has been supervised. Left-over grain has been kept and eaten as the following meal. After this was done, only 1 jin of millet was consumed per head per day. Before a month was up more than 5 tan of 'millet was saved. Another example was the collective meals at the nursery. In the past when the people there took meals in separate groups, the nursery consumed 150 jin of flour a meal. After collective meals were introduced, they only consumed 100 jin saving one-third. You see, comrades, what a surprising amount this is. Similarly the central departments and committees have implemented collective mess-halls and have also got good results. The Central Party School planned in the first half of the year to raise 2,000 chickens which required 300 bowls of millet a day. The waste was quite large. Afterwards they killed most of the chickens and only sixty were left. This saved quite a lot of grain. In addition, it is necessary to foster the habit of using meal-tickets. It can reduce the issue of large amounts of grain. In sum, in order to ensure that there are absolutely no shortages of grain, on the one hand we must levy and produce it and on the other we must seek to economize. This is the work for leading comrades and it is a mass-movement. Everyone must pay attention and complete the task given by the Party.

(Two chapters on taxation and economizing originally planned for this book could not be written in time because the Senior Cadres' Conference closed. They had to be left out.)
the Author


1. These figures are the totals paid in agricultural tax (public grain) by the peasants of the Shensi-Kansu-Ningsia Border Region from 1940 to 1942.

2. For 'better troops and simpler administration' see 'A most Important Policy'. Selected Works of Mao Tse-tung Volume 3 pp, 99-102.

3. The 'Three mountains' refer to three mythical islands where magic spirits are presumed to live.

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Selected Works of Mao Tse-tung