Xi Jinping’s Latest Published Speech Indicates Trend Toward Planned Economy: Experts

August 21, 2020 Updated: August 21, 2020

A speech given by Chinese leader Xi Jinping five years ago about facing difficult economic times has just been reprinted in nearly all of China’s state-controlled media, including the Chinese Communist Party’s (CCP) main theoretical journal. Some analysts take it as a sign that the Chinese economy is in trouble and the CCP is reverting to a planned economy.

In the speech, delivered in November 2015, Xi reiterated the importance of studying Marxist political economy in the face of an extremely complex economic situation at home and abroad. Now the speech has been republished in Qiushi, a bi-monthly political journal, among other state-run media.

Economist Li Hengqing, from Taiwan’s Chung-Hua Institution for Economic Research, told The Epoch Times that this is going back to the planned economy under China’s current economic difficulties.

Another analyst, economics professor Huiling Wu, told The Epoch Times he believes that this newly phrased old idea (of a planned economy) is in preparation for decoupling from the United States and adapting to isolationism. Wu said that the goal of the CCP’s state-owned economic system has remained unchanged and is aiming at eliminating and plundering the private economy. However, the regime no longer holds the rights to speak on the international stage.

Returning to Isolation

On Nov. 23, 2015, Xi delivered a speech at the meeting of the Politburo on the basic principles and methodology of Marxist political economy. On Aug. 16, nearly all state-run media reprinted Xi’s speech.

Economist Li Hengqing said in an interview with The Epoch Times that a Marxist political economy means overthrowing the capitalist system and overthrowing the exploiter/exploited labor relationship. At the core of Marxist political economy is the theory of surplus value, he said. Then, given the disparity between the rich and poor, and the serious inequality in current Chinese society, Li raised the questions: “Does this mean that another proletarian revolution is going to happen? Isn’t it quite dangerous [living] under the leadership of the Communist Party?”

China is now faced with both domestic and foreign economic difficulties, Li said. The economy lacks momentum for upward growth. With the U.S.-China trade war, exports have experienced negative growth and investment ended up with high debt. Therefore, Xi hopes to shift economic development through promoting “domestic circulation,” which means reliance on domestic consumption and demand.

“This is equivalent to going backward to the planned economy pioneered by Lenin,” Li said.

What will it be like to return to a planned economy? Li summarized China’s history under a planned economy between 1949 and 1976, when the CCP eliminated all privately-owned enterprises and confiscated their assets. A rural economy was established with people’s communes forming administrative units. But there was a lack of motivation to work, and productivity was low. Not only were resources and materials wasted, but people also suffered from lack of food.

Those days of standing in line to receive vouchers for grain, oil, sugar, and so forth, and the militarized management, may return, Li said. China’s economy is already on the verge of turmoil and collapse. Xi may be preparing to enter the economic state of wartime military management, he said. It’s like reminding his drummers that it’s theoretically correct to embark on the wartime economy, and that people must be prepared.

Uncertain Future of Private Enterprises

Two years ago, a slogan “Guo Jin Min Tui” was widely publicized by the regime’s media, meaning, “state-owned enterprises are to lead the economy and private industries are to retreat.”

But with the unprecedented economic downturn in 2020, Xi said twice this year that private industries must play their role well in the market, and the old path of a planned economy must not be revisited, when he spoke during the annual “Two Sessions” in May and at a meeting with business sectors in July. The Two Sessions refers to the regime’s annual political meetings, where the rubber-stamp legislature and its advisory body enact policies and agendas.

However, the reprinted article in Qiushi stresses that “the leading role of the state-owned economy must not be altered.”

Li said Xi has shifted the plan again, focusing more toward a planned economy–to replace the market economy with the state-owned economy.

Li’s interpretation of this shift is: “Whether it’s private enterprises, small and medium-sized private businesses, or even the self-employed, it must be abolished.”

Li said this is reflected in the fact that state-owned enterprises must follow the direction of the Central Party Committee, have Party branch committees set up in private enterprises, and local Party branch committees set up to lead small businesses collectively.

“It’s completely become a Party-state system, which is the essence of the ‘Guo Jin Min Tui’–the state advances, and the people retreat,” Li said.

“Everyone can see now that the withdrawal from the free market economy is the general direction in China. But this is a complete reversal of history, and there will be no good results,” he added.

‘Rogue’ Regime Plundering the World

Quoting from The Epoch Times’ editorial, “How the Specter of Communism Is Ruling Our World,” professor Wu Huilin said the political economy of Marxism is actually neither a doctrine nor a theory. “Communism should not be understood as an ideological movement, a political doctrine, or a failed attempt at a new way of ordering human affairs. Instead, it should be understood as a demon—an evil specter forged by hate, degeneracy, and other elemental forces in the universe.”

Wu said communism breeds war, famine, slaughter, tyranny, and has now given us the CCP virus (novel coronavirus), which has caused a disastrous global pandemic.

In Wu’s opinion, the reason why President Trump advocates countering the CCP is because the CCP has failed to fulfill its promises after China achieved rapid growth through gaining access to international market resources since joining the World Trade Organization (WTO) as a developing country in 2001, and enjoying tariff-free and other preferential policies.

“As a rogue regime, its purpose is to plunder the world,” Wu said, adding that it’s a regime based on a state-owned economy—a planned economy led by the Party.

“The hope that the Party would change its nature by allowing it to join the WTO has, to the contrary, led to the CCP attacking the West with its propaganda and its diseases. And the CCP virus is now destroying the world.”

In regard to the possibility of a U.S.-China economic decoupling, Wu said the CCP had no other choice. Fair trade is reciprocal, like the fair trade advocated by former U.S. President Ronald Reagan–it’s about removing all restrictive obstacles, one by one.

Summing up his thoughts, Wu said, “The ultimate goals of all U.S.-China conflicts are the change of China’s institutional structure, the fall of the Communist Party, and the emergence of freedom and democracy.”