Compare and contrast the economic policies of China and Russia between 1923 and 1991

During the 1920s Stalin became leader of Russia and the KMT (nationalist party) was getting a hold of rule in China, at the same time the CPC were increasingly growing under Mao´s leadership. Stalin’s idea of Russia becoming a respected world power economically as quickly as possible made his policies dramatic and caused a lot of change in the Russian economic system. Later on leaders would follow in his footsteps to a great extent concerning economic policies and economic reforms in Russia and China. The first leaders to take greater distance from Stalin’s policies in China and Russia were Gorbachev and Deng Xiaoping. In this essay I will compare and contrast the economic policies of China and Russia between 1923 and 1991. Under Mao after 1949 China took a slightly different model of Soviet economic policies, but still following Stalin’s model to some extent.

Economic policies under Stalin, Khrushchev, Brezhnev and Mao 1924-1980s

When Stalin came to power in 1924 Russia was facing several economic problems. Firstly the industrial production was still very low after the hardships of WW1. Secondly a lot of food was needed for the growing industrial population and the export of food would also give an extra raise in economic growth. Stalin’s main policies to face these problems were the five year plans to increase industrial productivity and the collectivization of farms to increase agricultural productivity. In a speech 1931 he made the goals of his policies very clear, “We are 50 or 100 years behind the advanced countries. We must make good this distance in 10 years. Either we do it or we will be crushed”. The first five year plans were a great success, and by 1940 the USSR was comparable to many of the more advanced western countries concerning the export of heavy industrial products. The collectivization however were less of a success, even if production and export increased it caused great suffering to the Russian farmers and many animals were killed resulting in great famine in parts of the USSR. This model of economic policies would become the way of Russia and China until the late 1970s.

At this time China was in a civil war crisis where the KMT turned out to be the dominant figure at first. The leader of the party Chiang Kai-shek was right-winged and favored the landowners before the peasants and no great economic reforms were made. Although the country was officially under KMT rule the Warlords still had much power in certain areas and were self-governing, so there was no constant overall economic policy taking place in China until 1949, when Mao became the leader of China and could carry out his economic policies.

In 1949 things in China became more interesting, as the CPC becomes the ruling government of the whole of China and Mao carries out his economic policies. These were very much similar to Stalin’s policies at first, Mao looked up to Stalin as a role-model for the way he had changed Russia economically and politically. 1950 to 1956 Mao collectivized 95% of all farmland and this was done by taking it from the landowners and redistributing it to the peasants, very much like in Russia during collectivization. Like in Russia this also caused the people a lot of hardship and estimations have been made that 2 million people died during this. The next step in collectivization was carried out a bit differently compared to Russia, as peasants were persuaded to join together in co-operative farms, not like in Russia where peasants had been forced to do this. This made a large impact as Mao now had the masses of the peasants on his side and they were much more co-operative and better results concerning agriculture could be achieved.
The Industrial changes also followed a Soviet model, Mao began by nationalizing most businesses and in 1953 a five year plan was begun and like in Russia concentrated on the development of heavy industry. However, before the five year plan was complete, Mao began to have serious doubts whether China was suited for this kind of heavy industry. When Stalin died in 1953 and Khrushchev came to power in Russia he changed many of Stalin’s policies which made Russia and China part ways. These reasons made Mao rethink his policies and also design a new way for China to continue its economic development.
This new design of economy in China is called “The Great Leap Forward”; it was a policy to meet Chinas demands and was no longer based on Russia’s or Stalin’s policies. This included the introduction of communes which partly decentralized the economy and a great change in industrial policy, aiming at much smaller factories which were set up in the countryside to provide machinery for agriculture. At first The Great Leap Forward seemed to be a terrible mistake and failure, estimations have been made that up to 20 million people lost their life’s as a result of it in 1959-63. However, if we look at the results of the Great Leap over a longer time-period, you can argue that The Great Leap Forward and Mao’s policies turned out successful and that it has enabled the development of an economic world power which is China today. Mao always followed a Russian model of communism to some extent, although he changed some of the ways the economic policies were directed, in a way that he thought it would fit Chinas needs.

Russia under Khrushchev and Brezhnev had little change in its economic policies and the economic situation remained strictly centralized. They continued on the 5 year plans although the industry concentrated a bit more on consumer goods and incentive was given to workers to increase production. Except for this there was little change in Russian economic policies until the Gorbachev came to power and unlike China the agriculture never really recovered from the collectivization of farms.

Economic reforms under Gorbachev and Deng

The economic changes that took place under Gorbachev in Russia and under Deng in China were very much parallel. The Law on State enterprises in Russia removed central planners and made factories work to orders from customers. Smaller private businesses were allowed now allowed to provide competition for the slow and inefficient services of the state. In China which was now under Deng’s rule after Mao’s death, the economy was also greatly decentralized and communes were given more incentives. Deng also wanted to modernize industry and accepted aid from the west.
In both Russia and China the results were at first negative as always when radical economic changes are carried out over a short period of time. In Russia it finally led to the end of communism and the end of the Soviet Union in 1989, while in China, demands for more radical reforms were abruptly put to an end by force. The main difference which led to these different results were that in China Deng had only allowed somewhat more liberty concerning the well educated and only concerning economy, while in Russia Gorbachev had gone all the way with his policy of Glasnost (freedom of speech etc.). So while the Soviet Union broke up and the communists in Russia were overthrown, China could continue with the CPC still in charge and the results of their economic policy turned out a great success.

Conclusion

To a great extent the economic policies of Russia and China under a communist rule followed in Stalin’s footsteps, but during the Great Leap Forward Mao came up with his own way of using this Soviet model of politics which would suit China in a better way. The greater changes concerning these policies took place under the leadership of Deng in China and Gorbachev in Russia, when the economy was decentralized and more initiative was given to the communes and factories. In China this resulted in some problems at first, as people were asking for more, but the CPC put its foot down and this stopped, while in Russia, it resulted in the end of the Soviet Union and the end of Communist rule.