Deng Xiaoping and the Transformation of China (83 page)

After Anhui enjoyed a very successful midyear harvest in 1979 in areas where contracting down to the household was being implemented, Wu Xiang, a former New China News Agency reporter who had spent time in Anhui, was encouraged by high officials in Beijing to publicize those successes. In 1992, when looking back at his actions from 1979 to 1981, Deng recalled that he was aware many people were then opposed to contracting down to the household and had even labeled it “capitalism,” but rather than attack them he had waited until the results were proven; gradually people recognized that the new strategy was working, and within several years, the experiments became national policy.
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Indeed, by the end of 1979, some estimated that half of the production teams in the country were distributing work down to small groups and one-quarter had made contracts with households.

In early 1980, Wan Li, seeking Hu Yaobang's support, told Hu that it wouldn't work to have people at lower levels surreptitiously practicing contracting down to the household: instead they needed the full support of the top party leaders. Wan Li thus suggested to Hu Yaobang that they convene a meeting of provincial party secretaries to give clear public support for the policy.
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It was only at this time, before the meeting of provincial secretaries, that Deng gave permission to allow the decentralization of rural production down to the household. On May 31, 1980, Deng called in Hu Qiaomu and Deng Liqun to express his support for contracting down to the household and to tell them to publicize his views. Many local areas moved quickly to allow household production, but even then some local officials remained unaware of Deng's position. Deng's request to his two writers in effect marked the end of the collective agriculture that had been launched with Mao's famous speech of July 31, 1955. At that time, Mao had proclaimed: “Throughout the Chinese countryside a new upsurge in the socialist mass movement is in sight. But some of our comrades are tottering along like a woman with bound feet. . . . The tide of social reform in the countryside—in the shape of cooperation—has already been reached in some places. Soon it will sweep the whole country.”
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In his talk to Hu Qiaomu and Deng Liqun on May 31, 1980, Deng avoided Mao's dramatic appeal. He said:

Now that more flexible policies have been introduced in the rural areas, the practice of fixing farm output quotas on a household basis has been adopted in some localities where it is suitable. It has proved quite effective
and changed things rapidly for the better. Fixing output quotas on a household basis has been adopted in most of the production teams in Feixi county, Anhui province, and there have been big increases in production. . . . Some comrades are worried that this practice may have an adverse effect on the collective economy. I think their fears are unwarranted. . . . Some comrades say that the pace of socialist transformation had been too rapid. I think there is some ground for this view. . . . If the transformation had advanced step by step, with a period of consolidation followed by further development, the result might have been better. . . . It is extremely important for us to proceed from concrete local conditions and take into account the wishes of the people.
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Deng, acutely aware of opposition among party conservatives, made his argument not to a large audience where there was certain to be unsympathetic critics, but only to his two writers, who then spread the message to the broader public.

Four years after Mao gave his rousing speech, tens of millions of peasants were starving, and twenty-five years after his speech, the collectives were dissolved. By contrast, four years after Deng's cautious, reasoned explanation to his writers, most of China's farming was being done by individual households, and agricultural production was rising rapidly. Twenty-five years after Deng's speech, the system he installed was still going strong.

Personnel changes accompanied the change in policy. At the Fifth Plenum of the 11th Party Congress in early 1980, when Deng brought in his own team headed by Hu Yaobang and Zhao Ziyang to lead the country, Wan Li became a vice premier, director of the State Agricultural Commission, and the member of the party Secretariat in charge of agriculture. As head of the State Agricultural Commission, Wan Li, with Deng's permission, could extend the model of household production nationwide. In August 1980 the leaders opposing contracting down to the household—Hua Guofeng, Chen Yonggui, and Wang Renzhong—were formally relieved of their posts as premier and vice premiers, respectively, and the media began criticizing the ultra-leftism of the Dazhai model.

In the summer of 1980 Wan Li began to prepare the formal document supporting the new policy, which was to be issued in late September. At a meeting of first party secretaries to discuss rural issues, Wan Li called on Du Runsheng, the highly respected agricultural specialist who had been head of the Secretariat of the Rural Work Department and also head of the Rural Development Institute on agricultural policy. After Du made a presentation
analyzing the results in Anhui, the provincial secretaries expressed varying views. Some of the strongest opposition came from Heilongjiang, where the larger fields were suitable for dry land crops and greater mechanization, and where it was not easy to divide the land down to the household. Some of those areas chose not to contract down to the household.

There also were differing views on what form household farming should take. In the end, the way that was chosen, “contracting down to the household,” retained public ownership of the land and allowed local officials to assign a certain production quota to each individual household. In the contract with the household, village officials specified which crops the household had to cultivate and how large the quota turned over to the government should be. In the contract, the local officials agreed to supply the land and machinery to the household and in return, after the harvest, the household would turn over a certain amount of grain and other crops. If a household no longer had enough able-bodied people to work the land, village leaders could reassign the land to other households. The term
baochan dao hu
, “contracting production responsibility down to the household,” was suggested by Du Runsheng; compared to some expressions, this term reassured conservatives that there was still a local unit that was assigning responsibility.
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From the perspective of the Beijing authorities, the system ensured that national needs for grain, cotton, and other crops would be met by the sum of the contracts with the farm households. Farm households had the freedom to grow crops in their own way, and once they had turned over the goods in their contracts, any remaining produce could be used by the family or sold in markets.

Based on papers and discussions at the meeting of provincial officials, Wan Li had his staff prepare Directive No. 75, which was issued on September 27, 1980.
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The document was carefully crafted. It permitted local collectives to assign responsibility for production down to the household in especially poor areas in order to avoid starvation. By October 1981 over half the production teams in the country had chosen some form of contracting down to the household. And by the end of 1982, 98 percent of rural households were listed as having some form of contracts with the production team.
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In 1982, the communes, which had been established in 1958 to mobilize peasants for large public-works projects and large-scale collective farming, were abolished. The highest of the three levels in the collective structure (commune, brigade, and team), the communes had originally combined economic and political functions in a single organization. After they were abolished, their political functions were taken on by the town or a large administrative
village government, and the commune's workshops and other economic units became independent “collective” enterprises.

Meanwhile, the doubling of chemical fertilizer production between 1978 and 1982 and the 20 percent increase in the procurement price of grain in 1979 assisted the improvement of grain production and the growth of rural income, albeit less than the shift to contracting production down to the household.
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From 1978 to 1982, peasant income roughly doubled.
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Some observers have argued that the idea of decentralizing production down to the household was invented by peasants, but in fact many officials knew about the idea and some had been considering it ever since the beginning of collectivization. It would be more accurate to say that when peasants were given a choice between collective or household farming, they overwhelmingly chose the household. Gradually officials who had doubts about household agriculture were won over. At the 13th Party Congress in 1987, the constitution was revised to guarantee the right to contract down to the household for the indefinite future.
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It took several years after de-collectivization and the introduction of household agriculture to make adjustments in supply and demand and to stabilize an effective national system of production and sale of agricultural crops. For several years agricultural specialists drew up documents each year dealing with such issues as rural organization, machinery, and other inputs to aid rural production. The documents were published in early January each year as central government Document No. 1. In Document No. 1, 1982, contracting down to the household and similar programs were all declared “socialist.” The ideological battle was over.

After household farming was introduced, grain production continued to rise rapidly. Indeed, as early as 1984 grain production surpassed 400 million tons, compared to 300 million tons in 1977. After 1981, the growth in the grain supply led the government to encourage farmers to diversify into vegetables, fruits, and industrial crops. Official estimates of per capita grain consumption rose from 1977 to 1984 from 195 kilograms to 250 kilograms, and consumption of pork, beef, poultry, and eggs increased even more sharply.
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The government had been completely unprepared for the huge grain harvest of 1984. As a result, there was not enough warehouse space to store the grain, and some local governments, lacking sufficient funds to purchase all the grain that had been produced, had to give the farmers paper IOUs. Before then, the government, fearing urban unrest, since 1978 had not passed on to the urban consumer the increase in prices paid to the farmers for rice.
This subsidy was a strain on the government budget, and after 1984 the costs were passed on to the urban consumer. On January 1, 1985, the government announced that it was no longer obligated to buy grain produced by the farmers. Because farmers planting their fields in 1985 worried that they might not get full payment for rice, they planted smaller rice crops and grain production consequently dropped 28 million tons, or about 7 percent (which was still 60 million tons more than that produced in 1980, when household farming first began to take hold). It took several years after the 1985 adjustments for grain production to recover to the 1984 levels and to put rural production on an even keel, but by 1989 grain output had surpassed the 1984 peak, and it continued at high levels thereafter.
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By then, there was sufficient rice production so that the government abolished grain rationing and consumers could buy all the rice they needed.

Contracting down to the household was not a panacea for all rural problems. Some areas, especially those in the Northeast where the large dry fields, instead of rice paddies, produced wheat, sorghum, or other grains, the farmers used tractors that could plow more land than that farmed by a single family. Some of those areas chose to retain collective agriculture. Under the collective system, the more successful production teams had been able to provide some care for the elderly and infirm residents who did not have families to look after them. With the end of collective agriculture, it was difficult to provide local community welfare. The twenty-five years of collective agriculture had had devastating consequences, especially where it was carried to extremes, but rural collectivization had also made it easier to expand irrigation and to develop a strong local party structure grounded in the collective—a party structure that did not entirely disappear with the introduction of household production.
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In addition to ending grain shortages and raising peasants' income, household production allowed for the expansion of industrial crops such as cotton, flax, and tobacco. In 1981 China was the fourth largest importer of cotton, and four years later it was exporting cotton. Rural families, motivated to work hard, could meet their agreed-upon grain-production targets and release their young adults to work in rural industry. Farmers selling produce in towns and cities, too, improved the quality and quantity of food for urban consumers. Even officials who had opposed the abolition of collective agriculture found that their wives and children were pleased with the expanded choices and improved quality of vegetables, fruit, chicken, and pork in the urban markets. In the 1980s, as refrigeration and transport improved, the varieties of vegetables, meat, and fruit continued to grow rapidly. Hundreds of millions
of rural peasants were lifted above the poverty line. Increased rural incomes provided outlets for expanding light industry. Yet most peasants, except for those on the outskirts of the urban areas, on average remained far poorer than urban residents and their health care and education lagged.