Published: January 25, 1954
Translated by: Unknown
Source: Deng Xiaoping Works
Transcription for MIA: Joonas Laine
This conference has been a success and achieved the desired results. This is because all participants have taken the overall situation into consideration and proceeded from the facts. Neither of these two approaches is dispensable. It is precisely because the Ministry of Finance did not follow these approaches in the past that problems have cropped up in its work, bringing numerous complaints from all departments.
At the beginning of this conference I discussed the need to check up on the work of the Ministry of Finance, elaborating on its shortcomings and the correct way it should do its work. Today I should like to focus on how the local authorities should conduct their financial work. Chairman Mao once pointed out that our Party always attached importance to strategy, involving all the soldiers and cooks with matters of strategy, and that as long as the strategic situation was made clear to everybody, things would be easy to handle. What Chairman Mao said is quite right. Take, for example, the collection of public grain. If we make clear to everyone the strategic importance and the overall situation, we shall be able to accomplish the task. In the past, however, when we ran into problems we seldom proceeded from the overall situation or explained to everyone the strategic questions clearly. This is why there have been shortcomings in the work of the Ministry of Finance. Therefore, I shall now try to explain the hows and whys clearly to everyone.
All our work involves relationships between the whole and the part, between the central and local authorities and between the principle of centralized and unified guidance and the principle of consideration of local conditions. We must have a clear understanding of both major and minor principles. Neither the whole nor the parts are dispensable, for without the parts, the whole, which is composed of the parts, would not exist. Which, then, should play the leading role — the whole or the part, the central or the local authorities, the principle of centralized and unified guidance or the principle of consideration of local conditions? If we let the part, the local authorities and consideration of local conditions play the leading role, we shall make mistakes of principle. The central authorities, the whole and the principle of centralized and unified guidance must play such a role. Therefore, comrades working at the central departments should give constant consideration to the parts, the local authorities and local conditions, and find out what difficulties the local authorities may have in their work. The Minister of Finance and the ministry’s division directors, bureau directors and section chiefs should always pay attention to the parts, enthusiastically helping local authorities solve all the difficult problems they can or explaining why when they cannot do it. The local authorities, for their part, should have in mind the whole, the central authorities and the principle of centralized and unified guidance, subordinating themselves to the central authorities. Since the local authorities are under the leadership of the central authorities, the parts belong to the whole and the principle of consideration of local conditions can be applied only under centralized and unified guidance, when contradictions arise between the opposites, the local authorities must be subordinate to the central authorities, the part to the whole, and the principle of consideration of local conditions to that of centralized and unified guidance. Otherwise, localism, departmentalism and “mountain-stronghold” mentality will result. In fact, departmentalism existed to varying degrees, and localism and “mountain-stronghold” mentality (which, of course, has historically been a problem) have also been a problem, because local authorities lacked sufficient understanding of the need of centralized and unified guidance and of consideration of the overall situation. Some of the central departments, on their part, failed to take the interests of the parts and the local authorities into consideration in the past, as a result various local authorities raised many justified complaints about the central departments prior to the National Conference on Financial and Economic Work held in the summer of 1953. But attention must also be paid to preventing the part from not giving consideration to the interests of the whole and the central authorities, although this does not present a problem now. We must have a clear and correct understanding of the relationship between the two all the same.
What is the overall point of view we should take in financial work? The financial department is a comprehensive department that fully reflects state policy and like all other departments, it must serve the needs of the general line. In other words, it must ensure the implementation of the Party’s general line or fulfilment of its general task for the transition period. Figuratively speaking, the main body of the general line is China’s industrialization and its wings are two transformations, namely, socialist transformation of agriculture and the handicraft industry on the one hand and socialist transformation of private capitalist industry and commerce on the other. The financial department should guarantee we have the funds for the country’s industrialization and socialist transformation. How should it guarantee this? First, by increasing revenues; and second, by cutting back expenditures. All possible revenues must be collected and expenditures cut back wherever possible. In order to curb expenditures, Chairman Mao says that in the final year of the First Five-Year Plan period (1953-57 — Tr.) the total expenditure of state organs (including administrative and military expenses) should not exceed 30 per cent of the state’s total budgeted expenditures and that cultural and educational expenses should also be cut appropriately, so as to concentrate our funds on industrialization and socialist transformation. Therefore, we should try to concentrate our financial resources on industrialization and socialist transformation if we want our country to become a great socialist state after a period of two or three five-year plans. When restricting expenditures, we should reason with people by explaining this principle to them, allocating money to them if we can or refusing if they can get along without this allocation. Although China is vast in territory and rich in natural resources, its productive forces are fairly backward and its financial resources limited. Therefore, our financial workers should know how to practise economy and spend money where it is needed most. If we think in terms of the general line, we shall easily see where the interests of the whole lie and understand the significance of centralized and unified guidance and the need to subordinate the local authorities to the central authorities and interests of the part to interests of the whole. In this way we shall be keen on practising economy, instead of trying to start too many undertakings at once. Therefore, the financial department should pay attention to the important things and take a strategic point of view.
(Excerpt from a concluding speech made at a national conference of directors of financial departments and bureaus.)