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Four Perspectives to Understand the Evolution of the Principal Contradiction Facing the Chinese Society

Submit Time:03-11-2017 | Zoom In | Zoom Out

Author:Nie Huihua | Source:Guang Ming Online (GMW)


The 19th National Congress of the Communist Party of China (CPC) convened at the Great Hall of the People in Beijing on October 18, 2017. Chinese President Xi Jinping delivered a report to the 19th National Congress on behalf of the 18th CPC Central Committee. As Xi noted in his report, “As socialism with Chinese Characteristics has entered a new era, the principal contradiction facing Chinese society has evolved. What we now face is the contradiction between the unbalanced and inadequate development and the people’s ever-growing needs for a better life.” This is a judgment of great importance. The evolution of the principal contradiction means the Party and the country need to change the priority of their work, the working principle and government policy, and the development philosophy and strategy accordingly. How should the evolution of the principal contradiction be understood? In my view, it may be explained from the following four perspectives.  

1. Contradiction between supply and demand evolves into the contradiction of unbalanced demand 

For a long period of time, China suffered from low productivity and per-capita income, and Chinese people failed to meet their basic living needs for clothes, food, housing and transport. Therefore, in the very beginning of the reform and opening-up, the Chinese communists became clearly aware that the principal contradiction facing the entire society was the one between the backward social production and the ever-growing material and cultural needs of the masses. Because of the principal contradiction, we had to set making every effort to develop productivity as our most important task back then. Over the three decades since the introduction of the reform and opening-up policy, China has managed to raise its productivity considerably, create a diversity of general material wealth, and help most Chinese people get rid of poverty. To date, China has become the world’s second largest economy in terms of GDP gross, and even has few equals in some manufacturing fields across the globe. Against such a backdrop, the principal contradiction confronting the entire society evolved from the contradiction between the backward social production and the needs of the masses for living necessities to the contradiction between the unbalanced and inadequate development and the people’s ever-growing needs for a better life. To put it simply, such contradiction manifested itself as the imbalance between demand and supply in the past while it is an expression of how much the people’s inward needs are met. Now the overall productivity is comparatively advanced in China. Some Chinese have become quite wealthy; some of them lead a fairly wealthy life; some still don’t live well. Everyone is entitled to pursue a better life. But they come from unequal backgrounds, progress at different paces, and are unable to make even achievements. So many of them still leave their needs for a better life unmet or not fully met. Our working objective for the next step is set to enable more people to meet their needs for a better life on a greater extent.  

2. Emphasis goes from quantity to quality. 

Considering the overall low productivity, what the Chinese society should do first was to ensure that its people could get the barely enough material and spiritual wealth in the past. Already lifting the productivity to a fairly high level, today’s people are no longer satisfied with the adequate quantity of consumer goods. Instead, they want high-quality goods more. For example, people felt ok as long as they could feed themselves in the past; with clothing and food not being a concern for a long time, they want to have more dedicate, healthy and nutritious food. The demand-side shift from quantity to quality suggests that the social production needs to catch up with this change accordingly. If companies continue to settle for the pure expansion in number or scale, and fail to pay more attention to product quality, personalized demand and technical innovation, they will be unable to meet the people’s needs for a better life any longer. In this sense, the supply-side structural reform turns to be a choice and strategy China has to make in the midst of evolution in the principal contradiction facing the entire society. Therefore, macro-control must start from the supply-side structural reform and is intended to make products more competitive at home and abroad through technical innovation and industry transformation/upgrade, and ultimately meet the masses’ needs for high-quality products.  

3. Pursuit goes from materials to well-rounded development.  

As a famous ancient Chinese saying goes, “when there are adequate stores, people will know what decorum is; when people have enough of good and clothing, they will know what honor is.” Material advancement lays ground for spiritual and cultural progress, and the latter proves to the more advanced phase of the former. In a broad sense, by mentioning spiritual advancement, we mean people’s improvement in public etiquette and ethical standards and also their pursuit of democracy, rule of law, equality, justice, security, and ecology, among other aspects. As a matter of fact, it refers to people’s commitment to well-rounded development. China has no longer been the poor, weak country as it was. Besides living necessities and entertainments, Chinese people would like to get more involved with public affairs, and do their bit to promote social equality and justice. At the same time, they attach more importance to social security and environmental protection. This can be seen as an engagement on a higher level. Therefore, while continuing the development of productivity, China also needs to steadily advance the reform in political structure, the development of the rule of law, and maintain the national unification and security. Likewise, a country which practices the rule of law, equality and justice with political affairs handled with integrity can better support its people’s advancement towards a better life. By saying a higher level of social development, we mean a phase where people can have their reasonable needs of all sorts met and achieve well-rounded development at the same time. China’s experience reveals that the efforts to develop economy prepare a solid material foundation and a stable mass base for its progress in democracy and rule of law. Eastern Europe that hastily waged a reform of political structure before its economy got ready stands as an example of the other way round.  

4. Priority of work goes from making a big pie to dividing it better.  

The evolution of the principal contradiction requires the shift of the priority of work accordingly. In the era of low productivity, to meet the people’s basic material and cultural needs became the primary target. Therefore, it was pivotal to developing productive forces rapidly and making a bigger economic pie. When the economic aggregate reaches a certain scale, how to divide the pie evenly grows into a major concern with each passing day. So far, since the income distribution policy is far from perfection, there is a fairly wide income gap among residents, especially in wealth distribution. As a result, there have emerged some imbalances and conflicts in the society inevitably. Now that the principal contradiction confronting the Chinese society has evolved into that between the unbalanced and inadequate development and the people’s ever-growing needs for a better life, we need to focus our effort on realizing the balanced development in the new era. For example, we can narrow down the income gap with income adjustment policy, bridge the regional gap with transfer payment policy, and close the gap between the rich and the poor with targeted poverty alleviation efforts.  Over the past several decades, the Central Government launched an array of regional development strategies including the large-scale development of the western region, the rise of the central region and the revitalization of northeast China. All of these reduced the gaps between different regions and promoted the coordinated development of regional economies at an accelerated pace. China has a vast territory which is abundant in various resources and varies greatly in different parts. One of its provinces usually covers an area or owns an economic volume as huge as a European country. Therefore, China needs to strive for balanced development to bridge its regional gap on the one hand and encourages its leading regions through two strategies, i.e. the integrated development of the Beijing-Tianjin-Hebei region and the Yangtze River Economic Belt to catch up with and surpass the developed countries in the West and then to drive the development of other regions on the other hand. Therefore, this is certainly a huge challenge confronting China. The realization of coordinated development among different regions is as important as the shift from a country with poor productivity to a major economy, as believed by the author.  

(Author: Vice President of the National Academy of Development and Strategy (NADS) and Professor of School of Economics at Renmin University of China)

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