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Selected Works of Mao Tse-tung



Within the three branches of the public sector of the economy, production by the troops and by the official organizations and schools is directly intended to meet their own living and running-costs. Production by government organs is also included in this. For example, the personnel working in the various departments and offices of the Border Region government run agricultural, handicraft and commercial undertakings. These directly supplement deficiencies in the running-expenses of the organs and in clothing, bedding and food for the personnel. By contrast the salt industry, industry and agriculture established as government enterprises are not intended to provide running-expenses but to meet the needs of the whole Party, government and army.

In Yan'an and the Border Region, the official organizations of the Party and government, leading organs of the mass organizations and many schools have pursued agriculture industry and commerce under the slogans 'set-to ourselves' and self-reliance'. This is a broad mass-movement, and it has solved many big problems of finance and supply. It is only just second to the army's production and it is worth our while to sum up its experience carefully, to point out its achievements and shortcomings and to determine the work-plan for 1943.

The army's production movement began in 1938 and gained some experience. In 1939 we spread this experience into all official organizations and schools. In February 1939 we held a Production Mobilization Conference. We organized production committees to be leading organs for the production movement and we stipulated different production tasks according to the different circumstances of the work and study of each official organization and school and the strength of their labour form. For example, we laid down that working personnel in district; and townships should be fully self-sufficient in grain and other organizations from the centre down to the county should be either one-half or one-third self-sufficient according to the strength and size of their labour force. In total we asked them to open up 100,200 mu of land and to harvest 13,000 tan of hulled grain. Besides this we decided that all official organizations and schools should be entirely self-sufficient in vegetables, should raise pigs for meat and should use the straw from their crops to provide part of the fodder for horses. At the time there were roughly 200,000 people in the official organizations and schools of the whole Border Region. We issued average production expenses of 2. 60 yuan per head, a total of offer 49,000 yuan. This provided capital to buy plough-oxen and agricultural tools. After they had found land and bought oxen and tools everyone was mobilized for the spring ploughing. Most of these people were intellectuals and youths who had never previously taken part in production. Together with cadres from worker and peasant backgrounds and service personnel, cooks and grooms, they were organized into production groups to open up the land. All hilltops near Yan'an with unused land became covered with men and women opening them up. They automatically showed labour discipline and declared competitions in clearing land. The strong took up hoes and the weak grew vegetables and raised pigs, or took food and water to the workers.

The gains from this production movement were: (i) the official organizations and schools of the whole Border Region opened up 113,414 mu of land, harvested 11,325.63 tan of grain (equivalent to 5,830.17 tan of hulled grain) and harvested roughly 1,200,00 jin of vegetables. At prevailing market-prices the two harvests were worth over 368,000 yuan (over 10,179,000 yuan at 1942 prices). This provided one-quarter of the grain requirements of 20,000 people, one-half of the horse fodder and some of the vegetables and meat. (ii) It enabled over 10,000 intellectuals and young people to understand from their own experience what physical labors is. This tempered them. (iii) When the common folk of the Border Region saw or heard that all working personnel and young students in all the Party and government official organizations — from Party Central Committee members to young service personnel—were all going up into the mountains to farm, they were moved. Everyone was keen to open up land and it became an exceptional year for doing so.

On the other hand, the stipulated task for grain productions was not fulfilled in this year because of lack of labour experience and because the application of manure, seed planting and weeding was not done at the right time. Also, in some areas there was drought and so forth. As a result, although a lot of land was opened up, the harvest was not large and only 45 per cent of the original grain target of 13,000 tan of hulled grain was achieved. Secondly the error of egalitarianism was committed in leadership and organization. The different nature of each organization and school was not considered. Some were given tasks that were too great such as the call for district and township cadres to be self-sufficient in grain. In fact they only achieved one-quarter. Some put off and spoilt their work or study in order to carry out production with the result that it was uneconomic. In some cases male and female comrades, physically too weak to do hard work, were forced to labour and their health suffered. Some units could in fact have undertaken industry and commerce but this was not pointed out at the time, and they purely and simply concentrated on agriculture.

In 1940 we corrected these shortcomings. First we reduced the agricultural production tasks. Apart from self-sufficiency in vegetables and meat, we stipulated that the official organizations and schools should be only from one-seventh to one-sixth or one-quarter self-sufficient in grain according to their different circumstances. We did not ask weak males nor any females to do physical labour. No person over fifty or under fifteen took part in production. We permitted the hiring of experienced peasants to join-in or to direct production. In addition the Finance Department issued 50,000 yuan to the official organizations and schools as capital to allow them to undertake industry and commerce and to develop animal husbandry, raising pigs and sheep. Therefore in agricultural production during 1940 we did not increase cultivated land beyond the existing amount. Some units lacked labour power and adopted the meshed of taking ordinary folk on as tenants. Some gave part of their grain-producing land to others and concentrated on planting vegetables and raising pigs. In addition some schools moved to other places in north China. Therefore the 1940 harvest only amounted to 3,000 tan of hulled grain and 900,000 jin of vegetables, worth 3 million yuan at the market-prices of the time.

The commerce we ran began with cooperatives. In 1939 each official organization and school had a consumers' cooperative and some had opened restaurants. By the first half of 1940 there were thirty cooperatives and restaurants with more than 60,000 guest capital. The largest had 10,000 yuan and the smallest not more than a few hundred yuan. Their aim was to supply daily necessities for the organization or school itself. At the same time they sold to outsiders for a slight profit as a means of improving their livelihood. They had still not become commercial undertakings to meet general needs. However, they gave initial tempering to cadres ruling commerce, and accumulated some commercial experience and a small amount of capital.

In the two years of 1939 and 1940, the organizations and schools generally did not undertake industry. They only set up some flour mills for their own needs and the rear services. Jiaotong set up a smithy for horseshoes. These can be considered the beginnings of their handicraft production.

The above was the first period in self-sufficient production for the organizations and schools. Below we turn to the second period.

In the winter of 1940 the production tasks of the organizations and schools rapidly changed as a result of the economic blockade of the Border Region, the cutting-off of outside aid, the extreme financial difficulties, and the unavoidable need to move quickly from semi-self-sufficiency to full self-sufficiency in finance and supplies.

At the time (with the exception of the troops) the various organs of the Party, government, army and mass organizations and the personnel of the schools could not all take up agriculture and the task of achieving self-sufficiency was extremely difficult. On the one hand we wanted to rely on developing production to ensure daily and monthly supplies. At the same time we wanted to accumulate capital to establish a foundation for future self-sufficiency.

In order to get through this difficult situation, the Party had government adopted necessary steps. First we improved the organizations for leading production. In succession we established the Finance and Economy Office directly under the Central Committee, the Rear Services Economic Construction Office, the Finance and Economy Office at top level in the Border Region Government, and ordered each sub-region and county to set up production committees. Second, between the winter of 1940 and the spring of 1941 the government paid out 700,000 yuan and the Border Region Bank lent 3 million yuan to increase the production capital of the various branches. This was handed to the various bodies leading self-sufficient production for issuing downwards, to be added to the capital accumulated by the organizations themselves in the first period. Thereupon everyone made new arrangements, selected personnel, chose undertakings put industry and commerce to the fore.

Agriculture was then placed in a subordinate position.

Below we shall discuss the experience of' the various organizations and schools in industry, commerce and agriculture during this period.

The starting point for the industry of the organizations and schools was textiles. Since the Border Region had wool, the personnel of the organizations and schools spun wool by hand after work and study during the winter of 1940. For a while it became a movement and everybody began to spin. But since there was not enough raw material and spinning skills were poor, the woolly threads were uneven, and too much labour was wasted. After March 1941 this was gradually stopped and we applied ourselves to setting up handicraft textile mills. In the first half of 1941 each large organization and school selected service personnel and messengers to go to the Refugee Textile Mill run by the government to study spinning and weaving. Like bamboo shoots after spring rain, more than ten textile mills grew up within a short time. The shortcoming was that there was no planning. By the latter half of the year because they had no ensured supply of raw materials or market for yarn, or because they lacked sufficient liquid capital or were poorly administered, some had closed, some had merged and some had temporarily closed. For example, the Xin Zhongguo Textile Mill of the Finance and Economy Office directly under the Central Committee first merged with the Shengli Mill of the Central Organization Department and then merged with the Tuanjie Mill run by the Marxism-Leninism Institute. Then using the name of Tuanjie Textile Mill, it was run in a centralized way and got more profit. The wool-spinning factory run by the Lu Xun Academy and the Women's University was closed down and its capital used elsewhere. The Tuanjie Textile Mill of the Financial and Economy Office under the Central Committee and the Jiaotong Mill run by the Rear Services could not fully employ their production capacity because of all kinds of difficulties. They alternately worked and closed down for a while until they eventually got on the right track. Thus the process of moving from a hand-spinning movement of several thousands of people to the setting up of handicraft factories, from the setting up of over ten small textile mills and wool-spinning factories to the final merger into two factories, the Jiaotong and the Tuanjie, was a process of moving from blindness to consciousness in which there was continuous groping forward through research, improvement in techniques and improvement in administration. This process on the one hand illustrated the hard-working spirit of the various organizations and schools and on the other illustrated our complete lack of experience in running industry at that time. By 1942 the Jiaotong produced 3, 336 bolts of cloth and the Tuanjie produced 2,736, becoming major factories in the Border Region. They are the valuable creation of the process of hard work and groping the way forward.

Besides textile mills, the organizations and schools directly under the Central Committee have successively set up many handicraft factories for such things as bedding and clothing, shoes, coal and charcoal, carpentry, papermaking, pottery, flour-milling and oil-pressing, silk weaving and making iron implements. Their aim has been self-sufficiency. The capital for these factories came either from commercial capital, or from bank loans, or from the closure of the wool-spinning factories. Warned by the experience with textiles, these factories were not run in such an entirely disorganized way. They were rather more orderly With several organizations and schools cooperating, or with cooperation with the common folk or with the Bank. But it was not all plain sailing. Most only laid a firm foundation after following a winding path from initial loss of capital through continued support to final profit.

In the years 1941 and 1942, the system under the Central Committee's Finance and Economy Office [Zhong-cai xitong] set up a total of twenty-seven large and small handicraft factories with total capital of over 400,000 yuan and with 477 employees. Among them there were eight textile mills with 217,000 yuan capital and 161 employees, three coal and charcoal factories with 70,000 yuan capital and sixty-eight employees, three mills with 15,000 yuan capital and twenty-one employees, two bedding and clothing factories with forty-eight employees (capital details not available), three carpentry factories with 35,000 yuan capital and seven employees, one shoe factory with 10,000 yuan capital and thirty-eight employees, and one papermaking workshop with 20,000 yuan capital and twenty-nine employees. In addition there were six small factories individually producing machinery, glass, alcohol, pottery, oil-lamps and blankets. (There are no statistics on capital and employees for these factories. The first three were experimental undertakings by the Natural Sciences Institute.) All the above factories were reorganized in September 1941 when the official organizations and schools directly under the Central Committee carried out their first drive for better troops and simpler administration. They were transferred to the direct control of Central Administration Bureau (the Finance and Economy Office directly under the Central Committee was dissolved and we set up the Central Administration Bureau attached to the Central Work Department [Zhongyang Bangongting]). Their number was reduced from twenty-seven by closure or merger to nineteen. In particular the merging of the eight textile mills into two, the Tuanjie and the Shiyan, enabled concentration of management and improvement in operation. Thus we were able to move from a situation where eight mills either lost capital or just maintained themselves to one of a profit of 1,600,0000 yuan in October 1942.

Self-sufficient industry run by the Rear Services system was started in the winter of 1940 just like that run by the central financial system. After two years' operation, 1941 and 1942, there was one textile mill, two papermaking factories, three charcoal factories, two carpentry factories, two silk-weaving factories, and one factory each for coal [shitan], refined salt, pottery, bedding and clothing, writing-brushes, ironwork, flour-milling, shoes and hemp-weaving, a total of nineteen altogether. There are no statistics yet for the amount of capital, number of employees and amount of production of these factories. Although the profit earned by these undertakings is not great (in the first ten months of 1942 it was 200,000 yuan), their great merits are:

  1. they are run in a centralized war by the Rear Services and are not run freely in a dispersed way as by the various official organizations and schools. Thus leadership and inspection are thorough, and mistakes are quickly corrected.
  2. They constitute a wide range of operation. Unlike the Central Committee's Finance and Economy Office system's initial concentration on textiles through the establishment of eight factories, the Rear Services has at all times only run one factory, the Jiaotong Textile Mill, and thus had spare capacity to do other things.
  3. They are entirely aimed at ensuring supplies. Although they do not earn money, they have provided a supply of many necessary goods.

In October 1942 we carried out a thorough drive for better troops and simpler administration. The Central Administration Bureau and Rear Services systems were combined, and their industries administered in a unified way. We also carried out further reorganization. The Tuanjie and Jiaotong textile mills and the bedding and clothing factories were transferred to the Finance Department. The medicine, alcohol, iron, and glassmaking factories were transferred to the Garrison Office. The Natural Sciences Institute and all the things that went with it were handed over to the government. All remaining factories were closed, or merged and handed over to the control of the Central Administration Bureau. By December 1942 there were three carpentry factories, two papermaking factories, five charcoal-factories, one shoe-factory, one oil-pressing factory, one flour-mill, three grinding-mills, one cart-factory, one wine-factory and three blanket-workshops, a total of twenty-one large and small handicraft factories and workshops. These can ensure all supplies of coal, shoes and flour, the manufacture and repair of all wooden and galvanized-iron implements, and some of the paper and edible-oil requirements for the whole of the Central Administration Bureau system. Bedding and clothing are supplied by the government. This is the outcome of the activism in industrial production over the past two years of the Central Administration Bureau (prior to September 1941 the Central Committee's Finance and Economy Office) and the Rear Services.

The above experience shows that under present circumstances it is essential for the official organizations and schools to run handicrafts. The aim is not to earn money but to ensure supplies of necessities. However, organizations and schools cannot set up any kind of factory they want to. They should choose in a planned way which ones to run, according to the nature of the industry and the situation in the official organization or school. They should reduce the number of errors created by blindly groping around. Existing factories should be organized into systems according to area and official organization. Cutbacks, mergers and transfers can reduce waste and enable them to play an even greater role in providing supplies.

As mentioned above, our comrades lacked experience of running commerce in the same way as they did of running industry. They had previously only managed a few cooperatives. We wished to turn to relying on a profit from commerce in order to provide a large proportion of supplies. What had to be done? Once again it was a process of moving from blindness to consciousness in order to find an answer to this question.

During 1941 and 1942 commerce started off with the aim of rapidly overcoming difficulties. Therefore we had no choice but to use the bulk of the capital of each official organization and school to trade for a quick profit.

In the year from autumn 1940 to autumn 1941 we mainly operated large stores. Some official organizations and schools enlarged their existing low-capital, small-profit cooperatives, small shops and stalls, increasing capital and staff, joining chambers of commerce and running proper commercial undertakings. For example, the Jiaotong Store of the military base was at first a small cigarette-shop set up at the entrance to the base at Qilipu in Yan'an. In August 1939 it moved to the new market in Yan'an and as well as selling general goods set up a Chinese Medicine shop and a horseshoe-shop. Its capital increased from a few hundred yuan to 20,000 yuan. Another example is the Hezuo Store which grew from the cooperative of the Anti-Japanese University. In June 1940 it moved to the new market and set up branch stores at the three branch schools of the Anti-Japanese University. Its capital increased from 80 yuan to 19,000 yuan. The Rear Services Store was at first a small stall with 30 yuan capital. By September 1940 it had expanded and its capital had grown to 20,000 yuan. As well as selling goods it also set up a dyeing shop. Originally many official organizations and schools did not have shops. Around this time they too collected capital and people together and set up business either independently or in partnerships. At the time the business done by all the publicly-run stores depended on trading goods mainly from Suide, Dingbian and Fuxian counties, in particular the cloth, paper, writing-materials required by the official organizations, schools and troops themselves, and the matches, raw cotton and so forth required by the common folk. During this period the official organizations and schools set up over sixty large and small stores in Yan'an, Suide and Dingbian, not including those run by the army. In addition, there were many that did not set up premises but depended on one or two people and a few animals to trade goods along the roads, calling it 'floating trade'. According to statistics for October 1941 the stores under the control of the Rear Services' committee for store administration were the Xibei Store, the Xibei Vegetable Cooperative, and fourteen large and small stores including the Xinghua, the Hezuo, the Jiaotong, the Xinxin, the Xingmin, the Minxing, the Biahuo. the Junmin, and so forth. The Central Administration Bureau had twenty stores.

We really relied on commerce to pass through a serious crisis during that year. It solved great problems of supply. For example, during the first half of 1941 the Central Committee's Finance and Economy Office and the official organizations and schools relied on the twenty large and small stores run by 113 staff with 296,800 yuan capital to earn a profit of 256,000 yuan which supplied 48 per cent of their daily running-expenses. The Rear Services system with capital of 706,000 yuan made 810,000 yuan profit in the same period which supplied 45 per cent of their daily running-costs.

However commerce during this period had one great fault which was excessive dispersal and no centralized leadership. Furthermore, almost all of it was trade in general goods. These faults came from the urgent need to solve difficulties in running-costs for each official organization and school. Each acted without coordination, competed with others and even disobeyed Party policy, influencing prices and currency. Simultaneously. there was price inflation, the Border Region banknotes lost value and the external blockade intensified. Suddenly dealing in export and import of general goods had a gloomy future and the various official organizations and schools which relied on this for their running-expenses also found themselves with problems. In this situation. it was urgently necessary to transform the commerce run by the official organizations and schools and by the army. This transformation began in the latter half of 1941. In the spring of 1942 the Border Region carried out an initial drive for better troops and simpler administration. It was then decided to organize all commerce into proper enterprises [qiyehua]. On the one hand each system put its existing stores in order, organized a joint committee for publicly-run commerce, unified the leadership of publicly-run stores, and strictly carried out laws, commands and policies. On the other hand they expanded the scope of commercial activity, carrying out many kinds of business such as salt-shops, mule and horse supplies, transshipment agencies, merchant warehousing, slaughtering and so forth. The method of operation also changed. In some cases stores were merged, in others capital was invested in private stores or in cooperatives and the official organization or school did not run its own trade. In other cases capital was invested in the government's Salt Company or in the Guanghua Store. Thereafter the fault of having too many shops competing with each other was avoided, and the function of providing the running-costs of the official organizations and schools could be restored. For example, as a result of reorganization according to this policy the Central Administration Bureau and Rear Services systems reduced the number of their shops from thirty-eight with 196 staff to twenty-five with 105 staff by October 1942. In the first ten months of 1942 the two systems earned a profit of 16,440,000 yuan with capital of 8 million yuan. This accounted for 68 per cent of all production income. Also during 1942 the production committees of the various departments and offices of the Border Region Government earned 600,000 yuan from agriculture and commerce, of this commerce accounted for 350,000 yuan or 58 per cent. Official organizations at sub-region and county level originally put agriculture first but by 1942 commerce was the most important.

In 1943 financial and economic leadership will be united [yiyuanhua]. External trade will be unified under the Commodities Bureau. Every official organization and school must carry out a thorough drive for better troops and simplified administration. As a result the commerce run by the official organizations and schools must be regulated by the Commodities Bureau, must share in running transport for local products and salt, and must allocate some capital for cooperation with the Commodities Bureau. In this way publicly-run commerce will be more rational.

The agricultural production of the official organizations and schools also made progress in 1941 and 1942. In these two years there were great achievements in the areas of grain, vegetables, charcoal and labour after work.

Some official organizations and schools were still growing grain entirely independently in 1941, some had already changed to forming partnerships with the common folk, and some ran agricultural stations (including both independent operation and partnerships). Independent operation had changed somewhat. The entire personnel no longer went up the mountains to farm. Instead, those who went were chiefly those doing miscellaneous duties organized into production teams accompanied by some of the physically stronger personnel. For example, the production teams of the various official organizations in the Rear Services system planted 5,200 mu of grain in 1941, and the Central Party School planted 800 mu. Those in partnership with the common folk included the Central organization Department which planted 840 mu and divided the grain at a ratio of 2:8, 2 to the government and 8 to the private individuals, and the hay at a ratio of 7:3, 7 to the government and 3 to the individuals. The agricultural stations included the two stations run by the Secretariat of the Border Region Government on a partnership basis. There were also the independent stations run at Nanniwan by teams selected from the miscellaneous duties personnel of the official organizations and schools equipped with oxen and tools. These included two from the Rear Services and one each from the Central Committee's Finance and Economy Office, the Central Organization Department and the Youth League cadres. Official organizations of the sub-regions and counties also adopted both independent operation and partnerships.

In 1942 the drive for better troops and simpler administration was carried out. Many official organizations and schools in Yan'an were merged. As a result, self-supporting vegetable production continued but all grain production was only carried out either at agricultural stations or in partnerships.

Although partnerships have some of the character of exploitation, the common folk, in particular the immigrants and refugees, appreciate it very much since the government supplies seed, plough oxen and agricultural implements, and the taxes are not high. This method has a role to play in encouraging immigration and in adjusting the use of labour power. The Party School provides an example:

The general office of the Party School planted 300 mu in partnership with four immigrants. These four were all very strong. The Party School sent one man responsible for leadership and inspection, The arrangements were for the Party School to supply the agricultural tools, a hoe, a pick and a sickle per man, to lend two oxen and to give the seed. They also lent grain at rate of 4 sheng of hauled grain per 3 mu making 4 tan for 300 mu. It was agreed to repay in the autumn of the following year. The division of the grain and hay harvest was laid down as 20 per cent of the spiked millet [gu (zi)] for the government and 80 per cent for the private individuals, 30 per cent of coarse millet [Meiji] for the government and 70 per cent for the private individuals, and 40 per cent of the miscellaneous grains for the government and 60 per cent for the private individuals. All the hay went to the Party School. This year the Party School received 10,500 jin of hay, 8.37 tan of spiked millet, 10.17 tan of coarse millet, 6.9 tou of black beans [heidou] 4.2 tou of hemp-seed [xiao mazi], l tou of sesame [lao mazi] and 2 tou of adzuki beans [xiaodou], valued at a total of 31,925 yuan in Border Region money. The four partners received 33.48 tan of spiked millet, 22.4 tan of coarse millet, 7.5 tou of black beans, 6.3 tou of hemp-seed, 1.5 tou of sesame, and 3 tou of adzuki beans, valued at a total of 46,805 yuan This is a good example of giving consideration to both public and private interests.

There is also new experience in building up agriculture stations. Since the personnel selected from the official organizations and schools are not strong labour powers, have limits on their working-time and are not skilled in agricultural techniques, they will waste their capital if they only concentrate on farming. In 1942 we adopted the following two methods. One was independent operation which includes subsidiary undertakings such as animal husbandry, wood-plank sawing and so forth as well as planting grain. This was like the method adopted by 359 Brigade. The other was to form partnerships and involved going into partnership with the common folk on stations that already had some foundation, and setting up another new station oneself. In the first year the new station brings no profit but in the second year it has some foundation and can also be changed into a partnership. The Secretariat of the Border Region Government provides an example. According to the comrades there:

We have two stations, one to the east, the other to the south. Their size, method of operation and harvest are much the same. In 1942 the southern station planted 288 mu of river land, 324 mu of previously farmed hill land and 408 mu of newly opened land. Altogether the harvest was 244 tan of grain. Since beans and corn formed the bulk, this was equivalent to 146.6 tan of hulled grain. Taking each tan at 1,300 yuan this was worth 190,230 yuan. We also harvested 14,000 jin of hay worth 14,000 yuan and 20,000 jin of vegetables worth 20,000 yuan The total value for these three items was 224,320 yuan Originally we had 128 sheep. In 1942, eighty-one lambs were raised, worth 10,000 yuan. We bought pigs for 3,482 yuan, and we also had thirteen worth 400 yuan each. The total of all the above items is 243,002 yuan.

As we have adopted the method of partnership operation all our expenditures were taken from the amount harvested including all expenses for the five men we assigned. We went into partnership with twelve households, totaling forty-five people. They had nineteen whole-labour powers, thirteen half-labour powers and thirteen children not able to work. Altogether their share was 68 tan of grain equivalent 40.8 tan of hulled grain with a total value of 53,040 yuan at 1,300 yuan per tan. They also received 7,000 jin of hay worth 7,000 yuan. The two items came to 60,040 yuan. Our own five men (one was crippled and looked after general running, two cooked, planted vegetables and crops, and two looked after sheep and did general work ) four oxen, one mule and five dogs received 30 tan of grain for eating equivalent to 18 tan of hulled grain worth 23,400 yuan and 50 jin of edible oil worth 1,300 yuan at 26 yuan per jin. In addition, repairs to implements, ploughs, clothing and supplementary payments came to 20,000 yuan. The total of all the above expenditure was 104,740 yuan giving a surplus of 138,262 yuan. Adding on the roughly 110,000 yuan from the eastern station, the return on the two stations was roughly 250,000 yuan.

The two stations are nominally run by the Secretariat and the Civil Affairs, Finance, Education and Reconstruction Departments. In practice, they only send out ten people of whom two are hired labourers, one is a cripple and seven are surplus personnel. The government has a production committee to control the two stations. In practice usually only one person runs things. This year thanks to floods and strong winds we were 150 tan short on our harvest, worth 117,000 yuan. We were also swindled on the seeds we bought for turnips and cabbage which were the wrong kind. This lost 30,000 yuan. These two items came to 147,000 yuan and total losses for the two stations were roughly 200,000 yuan. This means that without natural disasters and the wrong seeds we could get 200,000 yuan more. The working personnel in the Civil Affairs, Finance, Education, Reconstruction Departments and the Secretariat number around 400. The income of 250,000 yuan is thus an average of 625 yuan per head. Although the harvest this year is below norm, they have laid the foundations for next year and provided a livelihood for twelve immigrant households. Furthermore, relying on this foundation, next year we are preparing to expand the ploughed land at the southern station by 900 mu so as to settle down surplus personnel. The two original stations will still be run as partnerships.

The method adopted by the county-level official organizations also include both individual operation and partnerships. For example, the top-rank official organizations in Yan'an county have planted a total of 630 mu. Of these over 270 mu are farmed in partnership with two households. These have five labour powers and the county committee has only assigned two people to work on the station. The remaining 360 mu are farmed by criminals. In 1942, excluding the amount distributed to the partners, they received a total of 75 tan of grain, equivalent to 45 tan of hulled grain with a value of 58,500 yuan. With the addition of hay worth 3,000 yuan, the total was 61,500 yuan.

As the above examples show, independent operation, partnerships and a combination of both are correct. We should pay attention to this experience when determining the grain production tasks for 1943.

A very great task in agricultural work is the growing of vegetables since grain is also provided by the grain tax. If vegetables are not grown then over 20,000 people will be semi-starved. The saying 'no vegetables is like half a year's famine' is completely true.

The method for producing vegetables in the past two years has been to assign personnel specially for growing them and to assign some supplementary labour from the official organizations and schools. Each year we have on average been self-sufficient for three to six months. According to the Rear Services statistics in 1941 their various official organizations and schools planted 1,801 mu of vegetables consisting of 1,030 mu of potatoes and 771 mu of cabbage, beans, turnips and miscellaneous vegetables. In autumn, autumn cabbage and autumn turnips were planted on the 771 mu. Over the year 879,000 jin of vegetables were harvested equal to one-third of annual consumption on average. According to the Central Administration Bureau statistics, in 1942 the various official organizations and schools directly under central control assigned forty personnel for growing vegetables and planted 388 mu of river land and 1,941 mu of hill land. They harvested 745,000 jin of vegetables, being self-sufficient for five months on average. The Central Administration Bureau itself supplied nine months of its needs. Yan'an University and the Natural Sciences Institute both supplied eight months of their needs, and the Central Research Institute and the Chinese Writers Anti-Aggression Association [wen-Kang] both supplied seven months of their needs. The circumstances for vegetable production by the personnel in the various official organizations are very varied. For example, in Guanzhong sub-region they can only plant a little on account of the climate, and can only achieve three months' self-sufficiency on average. In the special military area they can only reach two or three months' self-sufficiency because of the scarcity of land. In some areas such as Huachi, Mudan and other counties they can achieve six months' or more because they have land and can farm in partnerships. Production of vegetables for their own use by official organizations and schools throughout the Border Region is estimated to be worth around 6 million yuan.

The problem here is to discern whether the method whereby the official organizations and schools assign production personnel to grow vegetables outside their permanent organizational structure is ultimately worthwhile or not. The experience of the various offices under central control shows that it is. The best land for growing vegetables is river land, where all kinds of green vegetables can be grown. On hilly land only potatoes and beans can be grown. One mu of river land growing vegetables can supply five people for a whole year, that is 0.2 mu per person. However, 1.5 mu of hill land is required to supply one person for one year. Furthermore, so long as a man specializing in growing vegetables has additional help when spreading manure, he can farm 6 mu of river land. This means that one man specializing in growing vegetables together with some supplementary labour can supply a year's vegetables for thirty people. The daily vegetable requirement per head is 12 liang and the annual requirement is 300 jin. For thirty people the annual requirement is 9,000 jin. At December 1942 Yan'an market prices of 3 yuan per jin, the total value of this is 27,000 yuan. Allowing 6,000 yuan for the man specializing in growing vegetables there is a surplus of 21,000 yuan. Taking the necessary incentive payments into account, the least return is 20,000 yuan. Therefore in future after each official organization and school has carried out a thorough drive for better troops and simpler administration, it should pay attention to arranging river land for growing vegetables, to assigning personnel for the work, to providing supplementary labour and to ensuring self-sufficiency in vegetables for more than half a year and even for a whole year.

Apart from grain and vegetables, raising pigs and sheep for meat is also an important part of agriculture.

Some people consider that raising pigs wastes grain. However, our experience proves that raising pigs does not waste grain and, instead, not raising them does. First of all, without pigs, leftovers have to be thrown away, and there are quite a lot of leftovers in large official organizations and companies. Secondly, if little meat is eaten then greater quantities of other food is consumed, and if a lot of meat is eaten then less other food is consumed. Thus, raising pigs to increase meat supplies is not only necessary to maintain health but is also economically rational. The various official organizations and schools have developed many ways of raising pigs. For example, the Central Party School directed the pig slaughterhouse to send someone to the kitchen daily to collect the water in which the grain was washed and the vegetable waste to feed the pigs. The Central General Affairs Section [Zhongyang Zongwuchu] directed someone to collect as pig-food the waste left after husking the grain and also the leaves and roots left over in the vegetable plots when the vegetables were harvested. According to the Rear Services Department statistics, in the first half of 1941 its various official organizations got 56,814 jin of pork worth 170,440 yuan at the market-prices of that time. This was enough for each person to have 1 jin of pork a month. If we add the following six months, the value for the whole year was roughly 350,000 yuan. According to the statistics of the Central Administration Bureau, the various official organizations and schools directly under central control raised an average of 2 65 pigs a month up to October 1942. Over the ten months this gave an estimated 23,330 jin of pork worth 700,000 yuan in Border Region currency. Another example is the top-level official organizations in Yan'an county, which in the first ten months of 1942 earned 10,000 yuan from pig-raising. According to these figures the total value of animal husbandry by the official organizations and schools of the whole Border Region is more than 4 million yuan.

As well as raising pigs, raising sheep is also profitable where there is pasture.

After a thorough drive for better troops and simpler administration in 1943, we can adopt the method used by 359 Brigade whereby they assign one cook for every forty people and reduce the service personnel. The remaining cooks and service personnel are sent to work on the production front where they can do many things such as growing grain and vegetables, and raising pigs and sheep. Running large-scale animal husbandry on large livestock farms should be given greater prominence in 1943.

Apart from the grain, vegetables and animals, there is also charcoal-burning and labour done outside working hours, both of which have provided examples worth looking at. All the charcoal used in the winter of 1942 by the various official organizations and schools in Yan'an was provided by teams of people from those institutions sent up into the hills. If it had been bought, a substantial sum of money would have been involved. In September the Central General Affairs Section organized a charcoal-burning team of forty-two people made up of service personnel, cooks and grooms to spend three months up in the hills making charcoal. Altogether they prepared 145 pits of charcoal completing their task of making 140,000 jin. At 1.20 yuan a jin this was worth 168,000 yuan. If during the four winter months the 30,000 people in the official organizations and schools of the Border Region on average made 1 jin of charcoal per head per day, this would provide 3,600,000 jin of charcoal worth 3,600,000 yuan. If we do not make the charcoal ourselves, where shall we find such a large amount of money?

There is also the labour done outside working-hours by the miscellaneous duties personnel of the official organizations and offices of the Border Region. For example, the Central General Affairs Section this year mobilized them to repair buildings, to build surrounding walls, to make bridges, to build roads and to cut horse-fodder. This saved the government over 110,000 yuan. Similar labour done by miscellaneous personnel of the Central Party School saved the government over 139,000 yuan; and 359 Brigade did not employ outside workers for any of its repairs or new construction. All official organizations and schools should strive to do the same. Mobilize all the people in an official organization or school to do all the work they can do. If we only consider the labour done after working hours by miscellaneous duties personnel, the amount from all the official organizations and schools of the Border Region could be surprising. We should give rewards to all people who make achievements in production, and this should also apply to labour outside working-hours.

The above is a summary of the experience of the various official organizations and schools of the Border Region in self-sufficient production during the period 1939-42.

According to the comrades doing economic work, in the two years 1941 and 1942 the agricultural, industrial and commercial capital of the Central Administration Bureau and the Rear Services Department rose from 1,281,917 yuan to 11,690,000 yuan (much of this increase was due to the fall in the value of the currency and it was not all due to increased production). The production surplus of the year 1942 was 23,810,000 yuan. Except for the 2,330,000 yuan retained to increase production capital in 1943 the remaining 21,480,000 yuan was all used to supplement food clothing, bedding and office expenses for the various official organizations and schools. In terms of the type of enterprise, agriculture accounted for 17 per cent, industry 8 per cent, salt 7 per cent and commerce 68 per cent. In terms of the official organizations, the enterprises directly under the control of the Rear Services Department got 8,400,000 yuan, those directly under the Central Administration Bureau 3,500,000 yuan, those jointly run by the above two 800,000 yuan, and those run by the various official organizations and schools individually 11,100,000 yuan. If we compare the amount of self-supporting production and the amount supplied by the people, the former is 57.5 per cent and the latter 42.5 per cent. The comrades at county level estimate that the monthly running-expenses for Party and government at county level is roughly 10,000 yuan. Their own production is around 9,000 yuan and the upper levels only issue around 1,000 yuan The proportion is thus 90 per cent to 10 per cent and is an even greater achievement.

In sum, the self-supporting production work of the official organizations and schools of Yan'an and of the whole Border Region has had some success. It has not only supplied the greater part of daily running-expenses and solved urgent financial problems but has also laid a secure foundation for the public sector of the economy. Relying on this base, we can continue to develop production and solve future problems.

What is particularly important and worth raising is that we have gained experience in running economic enterprises. This is a priceless treasure that cannot be reckoned in figures. We should not only be able to manage political, military, Party and cultural affairs, but should also be able to manage economic affairs. If we could do all the others but not economic work. we would be a useless bunch of people. We would be overthrown by our enemies and decline until we collapsed.

In the light of our experience of the past five years and particularly the past two, production by official organizations and schools must henceforth improve, expanding its achievements. overcoming its weak points, developing towards greater consolidation and completing even greater production tasks. In 1943 we should adopt the following policies:

  1. Implement the policy of taking agriculture as the chief sector.
    1. According to the actual circumstances in the official organizations and schools, in each system adopt the following methods of running agriculture: (i) Those with no foundations in agricultural stations should at once set-to to prepare ploughs and tools, and separately or in partnership with the people grow grain and vegetables. (ii) Those with agricultural stations, as well as continuing production, should expand the scope of operations and arrange for surplus personnel to do more subsidiary work such as raising pigs, sheep, chickens and ducks, sawing planks and so forth. They should also form partnerships with the ordinary people and open new farms. With these methods grain production in 1943 will be greater and better than in 1942. Agriculture must not be considered backward and must not be neglected.
    2. All official organizations and schools, large and small, must allocate the necessary personnel to specialize in growing vegetables supplemented by light work done by working personnel and students. According to the area and climate become self sufficient in vegetables for six or more months of the year, and strive to become entirely self-sufficient. This is one of the most important steps in improving livelihood.
  2. Coordinate and develop the various kinds of handicrafts. According to the area, system and the principle of better troops and simpler administration, join the existing handicrafts of a similar nature run by each section into partnerships. At the same time, according to the needs of each area and each system, set up new handicraft workshops, such as oil-pressing workshops, places to make Soya sauce and condiments, charcoal pits and so forth. The principles for running these handicrafts should be first that the workshop itself must be self-supporting, and second that it can make a profit.
  3. Develop animal husbandry. All official organizations and schools both large and small should raise pigs and strive to equal 359 Brigade's rate of one pig for every five people, so as to increase the supply of meat. Treat increasing the supply of meat, improving living-standards and raising health-standards as extremely important matters. In addition, each large official organization and school, and particularly the army, should set aside capital and without harming the interests of the people select areas in Sanbian, Longdong, Jinpenwan and so forth to run livestock farms. They should raise large numbers of cows, sheep, donkeys and horses, preparing for the time after victory in the War of Resistance when the Border Region's salt trade declines and it has to be replaced by animal exports.
  4. Develop transport undertakings. After a thorough drive for better troops and simpler administration, keep only a small number of animals to ensure the transport of grain and straw needed by each official organization and school itself. All surplus animals together with animals specially purchased should be organized into transport teams to transport salt or goods. These transport undertakings can be run by area and system as the best way of reducing costs.
  5. Regulate commerce. Following the policy of commerce playing a supplementary role and the principles of not going against trading policies nor doing speculative business, run shops in partnerships or individually according to the circumstances in the various systems and units after the drive for better troops and simpler administration. Eradicate commerce which goes against policy and close unprofitable shops. The various systems should transfer the proportion needed from commercial capital to agriculture, animal husbandry, handicrafts and transport. Do not hesitate to lay secure foundations in the work of becoming self-supporting through agriculture, industry, animal husbandry and transport.
  6. Treat improving the livelihood of the working personnel, miscellaneous duties personnel and students in the official organizations and schools as an important matter. Responsible people in these institutions should think of all kinds of ways of doing so. Under the principle of voluntary participation, they should encourage and direct miscellaneous duties personnel, working personnel and mothers with children to carry out some handicraft or agricultural production in ways which do not hinder their work, study or health. However, they should not run commerce. This work can be carried out in large production cooperatives, in small production groups or individually as the people involved wish. The government should provide loans for capital and the earnings should belong to the people who take part in the labour. All responsible people who run this very well and have the best successes should get rewards. All those who are not good at running their official organizations and schools hence make the life of the working personnel, miscellaneous duties personnel, students, mothers, children, the sick and the convalescent too harsh, or those who improve livelihood through ways which are wrong, hinder-work and study, or sabotage policies and orders should be criticized and taken to task.
  7. Implement unified leadership. Firmly carry out the principle of unified leadership and dispersed operation. The top-levels of the central Committee, the Border Region, the special regions [zhuangqu] and the counties should all set up strong leadership organizations concerned with unifying all production undertakings. According to the system and level, unify the policies for running enterprises, unify the coordination between the enterprises, and unify the ways of inspecting the running of each enterprise. Furthermore, under the condition of permitting each production unit to retain a suitable profit for itself, within a suitable area to the nature of production and operation, unify the distribution of the profits from production. This is necessary to avoid the great evils of lack of coordination, of inequalities in profits and losses, and of disparities in hardship and comforts.
  8. All agriculture, industry, animal husbandry, transport and commerce must be run as proper enterprises [qiyehua], using the system of economic accounting. The food, bedding, clothing and payments for the working personnel and employees in each enterprise should be supplied by the enterprise itself. They must not be provided at public expense.
  9. All production organs (factories, shops, etc.) should be 'popularized' no matter whether they belong to the government, the troops or the official organizations and schools. With the exception of the allocation of production tasks, the administration and supervision of production and the disposal of the results of production, everything else is under the leadership of the local Party and government, even including branch life. All personnel in production organizations must carry out policies, be law-abiding and pay taxes, take off their uniforms and put on ordinary clothing, join in the activities of the local masses and be model citizens of the Border Region.
  10. In accordance with the concrete circumstances, the Finance and Economy Office and the financial and economic committees of the sub-regions should issue specific production tasks for 1943 to the official organizations and schools in each county system. They should investigate and examine the production plans, and enter all the results of production completed within the plan by these production units into the financial accounts. Surplus production beyond the plan should be retained by the unit for itself as a means of improving livelihood. Upper levels should issue supplements to units whose production is not enough Those that made a loss in 1942 should be quickly examined to find ways of making up the deficiency.
  11. The four shortcomings pointed out in Chapter 8, 'On the Development of the Productive Undertakings of the Troops', also apply to the official organizations and schools. All official organizations and schools committing similar abuses should pay attention to correcting them.
  12. It must be clearly explained to all personnel engaged in agriculture, industry, animal husbandry, transport, commerce and labour outside working-hours (including the ordinary people working as hired labour or in partnerships) that their work is for the revolution and they are part of a very glorious cause. Setting aside a portion of the income from their labour to hand over to the government all helps our own, glorious and sacred revolutionary cause. It does not increase the assets of any individual. If publicly employed personnel working in the public sector of the economy plot to make special profits for themselves, they are guilty of immoral conduct within our ranks and crimes of corruption before the law. Those who are entirely free of corruption and waste, and work loyally for the Party and the country, are considered noble and moral, and should receive praise and rewards from the Party and the government. This point should be explained to the troops.
  13. All people doing economic, financial, supply and general service work, so long as they are not corrupt, do not waste, are loyal and work for the Party and the country, should be honoured. All people who treat their work lightly or with disdain should be criticized and rebuked.

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Selected Works of Mao Tse-tung