January 18-February 21, 1992

I

I was here in Guangdong in 1984. At that time rural reform had been under way for several years, and we were just beginning to introduce urban reform and to establish special economic zones. Eight years have passed since then. This time, during my trip here, I have found that the rapid growth in the Shenzhen and Zhuhai special economic zones and some other areas has exceeded my expectations. After what I have seen, I am even more confident.

Revolution means the emancipation of the productive forces, and so does reform. The overthrow of the reactionary rule of imperialism, feudalism and bureaucrat-capitalism helped release the productive forces of the Chinese people. This was revolution, so revolution means the emancipation of the productive forces. After the basic socialist system has been established, it is necessary to fundamentally change the economic structure that has hampered the development of the productive forces and to establish a vigorous socialist economic structure that will promote their development. This is reform, so reform also means the emancipation of the productive forces. In the past, we only stressed expansion of the productive forces under socialism, without mentioning the need to liberate them through reform. That conception was incomplete. Both the liberation and the expansion of the productive forces are essential.

In upholding the line, principles and policies formulated since the Third Plenary Session of the Eleventh Central Committee of the CPC, it is essential to adhere to the principle of "one central task and two basic points". If we did not adhere to socialism, implement the policies of reform and opening to the outside world, develop the economy and raise living standards, we would find ourselves in a blind alley. We should adhere to the basic line for a hundred years, with no vacillation. That is the only way to win the trust and support of the people. Any one who attempted to change the line, principles and policies adopted since the Third Plenary Session of the Eleventh Central Committee would not be countenanced by the people; he would be toppled. I have said this several times. Had it not been for the achievements of the reform and the open policy, we could not have weathered June 4th. And if we had failed that test, there would have been chaos and civil war. The "cultural revolution" was a civil war. Why was it that our country could remain stable after the June 4th Incident? It was precisely because we had carried out the reform and the open policy, which have promoted economic growth and raised living standards. The army and the government should therefore safeguard the socialist system and these policies.

In the short span of the last dozen years, the rapid development of our country has delighted the people and attracted world attention. This suffices to prove the correctness of the line, principles and policies adopted since the Third Plenary Session of the Eleventh Central Committee. No one could change them, even if he wanted to. After all that's been said, I can sum up our position in one sentence: we shall keep to this line and these principles and policies. Since we introduced the reform and the open policy, we have drawn up many rules and regulations covering all fields of endeavour. Clear-cut guidelines and policies concerning economic and political affairs, science and technology, education, culture and military and foreign affairs have been worked out and expressed in precise terms. The recent Eighth Plenary Session of the Thirteenth Central Committee was a success. It declared that the rural household contract responsibility system with remuneration linked to output should remain unchanged. Any change in that system would cause concern among the people, who would say that the Central Committee had altered its policy.

In the initial stage of the rural reform, there emerged in Anhui Province the issue of the "Fool's Sunflower Seeds". Many people felt uncomfortable with this man who had made a profit of 1 million yuan. They called for action to be taken against him. I said that no action should be taken, because that would make people think we had changed our policies, and the loss would outweigh the gain. There are many problems like this one, and if we don't handle them properly, our policies could easily be undermined and overall reform affected. The basic policies for urban and rural reform must be kept stable for a long time to come.

Of course, as the reform progresses, some of these policies should be improved or amended as necessary. But we should keep firmly to our general direction. It doesn't matter much whether we can come up with new ideas. What matters is that we should not change our policies and should not make people feel that we are changing them. Then, the prospects for China will be excellent.

II

We should be bolder than before in conducting reform and opening to the outside and have the courage to experiment. We must not act like women with bound feet. Once we are sure that something should be done, we should dare to experiment and break a new path. That is the important lesson to be learned from Shenzhen. If we don't have the pioneering spirit, if we're afraid to take risks, if we have no energy and drive, we cannot break a new path, a good path, or accomplish anything new. Who dares claim that he is 100 per cent sure of success and that he is taking no risks? No one can ever be 100 per cent sure at the outset that what he is doing is correct. I've never been that sure. Every year leaders should review what they have done, continuing those measures that have proved correct, acting promptly to change those that have proved wrong and tackling new problems as soon as they are identified.

It will probably take another thirty years for us to develop a more mature and well-defined system in every field. The principles and policies to be applied under each system will also be more firmly established. We are constantly accumulating more experience in building a Chinese-style socialism. Judging from the local press, the provinces have gained considerable experience, each proceeding in light of its own particular features. That's good. Creativity is just what we want.

The reason some people hesitate to carry out the reform and the open policy and dare not break new ground is, in essence, that they're afraid it would mean introducing too many elements of capitalism and, indeed, taking the capitalist road. The crux of the matter is whether the road is capitalist or socialist. The chief criterion for making that judgement should be whether it promotes the growth of the productive forces in a socialist society, increases the overall strength of the socialist state and raises living standards. As for building special economic zones, some people disagreed with the idea right from the start, wondering whether it would not mean introducing capitalism. The achievements in the construction of Shenzhen have given these people a definite answer: special economic zones are socialist, not capitalist. In the case of Shenzhen, the publicly owned sector is the mainstay of the economy, while the foreign-invested sector accounts for only a quarter. And even in that sector, we benefit from taxes and employment opportunities. We should have more of the three kinds of foreign-invested ventures [joint, cooperative and foreign-owned]. There is no reason to be afraid of them. So long as we keep level-headed, there is no cause for alarm. We have our advantages: we have the large and medium-sized state-owned enterprises and the rural enterprises. More important, political power is in our hands.

Some people argue that the more foreign investment flows in and the more ventures of the three kinds are established, the more elements of capitalism will be introduced and the more capitalism will expand in China. These people lack basic knowledge. At the current stage, foreign-funded enterprises in China are allowed to make some money in accordance with existing laws and policies. But the government levies taxes on those enterprises, workers get wages from them, and we learn technology and managerial skills. In addition, we can get information from them that will help us open more markets. Therefore, subject to the constraints of China's overall political and economic conditions, foreign-funded enterprises are useful supplements to the socialist economy, and in the final analysis they are good for socialism.

The proportion of planning to market forces is not the essential difference between socialism and capitalism. A planned economy is not equivalent to socialism, because there is planning under capitalism too; a market economy is not capitalism, because there are markets under socialism too. Planning and market forces are both means of controlling economic activity. The essence of socialism is liberation and development of the productive forces, elimination of exploitation and polarization, and the ultimate achievement of prosperity for all. This concept must be made clear to the people. Are securities and the stock market good or bad? Do they entail any dangers? Are they peculiar to capitalism? Can socialism make use of them? We allow people to reserve their judgement, but we must try these things out. If, after one or two years of experimentation, they prove feasible, we can expand them. Otherwise, we can put a stop to them and be done with it. We can stop them all at once or gradually, totally or partially. What is there to be afraid of? So long as we keep this attitude, everything will be all right, and we shall not make any major mistakes. In short, if we want socialism to achieve superiority over capitalism, we should not hesitate to draw on the achievements of all cultures and to learn from other countries, including the developed capitalist countries, all advanced methods of operation and techniques of management that reflect the laws governing modern socialized production.

To take the road to socialism is to realize common prosperity step by step. Our plan is as follows: where conditions permit, some areas may develop faster than others; those that develop faster can help promote the progress of those that lag behind, until all become prosperous. If the rich keep getting richer and the poor poorer, polarization will emerge. The socialist system must and can avoid polarization. One way is for the areas that become prosperous first to support the poor ones by paying more taxes or turning in more profits to the state. Of course, this should not be done too soon. At present, we don't want to dampen the vitality of the developed areas or encourage the practice of having everyone "eat from the same big pot". We should study when to raise this question and how to settle it. I can imagine that the right time might be the end of this century, when our people are living a fairly comfortable life. At that time, while developed areas continue to grow, they should also give strong support to less developed areas by paying more taxes, turning in more profits and transferring technology. Most of the less developed areas are rich in resources and have great potential for development. In short, taking the country as whole, I am confident that we can gradually bridge the gap between coastal and inland areas.

In the beginning opinions were divided about the reform and the open policy. That was normal. The difference was not only over the special economic zones but also over the bigger issues, such as the rural reform that introduced the household contract responsibility system with remuneration linked to output and abolished the system of people's communes. Initially, in the country as a whole, only one third of the provinces launched the reform. By the second year, however, more than two thirds of them had done so, and the third year almost all the rest joined in. At first, people were not enthusiastic about rural reform, and many waited to see how it would work. It was our policy to permit people to do that, which was much better than coercing them. In carrying out the line, principles and policies adopted since the Third Plenary Session of the Eleventh Central Committee, we did not resort to compulsion or mass movements. People were allowed to follow the line on a voluntary basis, doing as much or as little as they wished. In this way, others gradually followed suit. It was my idea to discourage contention, so as to have more time for action. Once disputes begin, they complicate matters and waste a lot of time. As a result, nothing is accomplished. Don't argue; try bold experiments and blaze new trails. That's the way it was with rural reform, and that's the way it should be with urban reform.

At present, we are being affected by both Right and "Left" tendencies. But it is the "Left" tendencies that have the deepest roots. Some theorists and politicians try to intimidate people by pinning political labels on them. That is not a Right tactic but a "Left" one. "Left" tendencies have a revolutionary connotation, giving the impression that the more "Left" one is, the more revolutionary one is. In the history of the Party, those tendencies have led to dire consequences. Some fine things were destroyed overnight. Right tendencies can destroy socialism, but so can "Left" ones. China should maintain vigilance against the Right but primarily against the "Left". The Right still exists, as can be seen from disturbances. But the "Left" is there too. Regarding reform and the open policy as means of introducing capitalism, and seeing the danger of peaceful evolution towards capitalism as coming chiefly from the economic sphere are "Left" tendencies. If we keep clear heads, we shall not commit gross errors, and when problems emerge, they can be easily put right.

III

If we are to seize opportunities to promote China's all-round development, it is crucial to expand the economy. The economies of some of our neighbouring countries and regions are growing faster than ours. If our economy stagnates or develops only slowly, the people will make comparisons and ask why. Therefore, those areas that are in a position to develop should not be obstructed. Where local conditions permit, development should proceed as fast as possible. There is nothing to worry about so long as we stress efficiency and quality and develop an export-oriented economy. Slow growth equals stagnation and even retrogression. We must grasp opportunities; the present offers an excellent one. The only thing I worry about is that we may lose opportunities. If we don't seize them, they will slip through our fingers as time speeds by.

In developing the economy, we should strive to reach a higher level every few years. Of course, this should not be interpreted as encouraging unrealistic speed. We should do solid work, stressing efficiency, so as to realize steady, coordinated progress. Guangdong, for example, should try to mount several steps and catch up with the "four little dragons" of Asia in twenty years. In relatively developed areas such as Jiangsu Province, growth should be faster than the national average. Shanghai is another example. It has all the necessary conditions for faster progress. It enjoys obvious advantages in skilled people, technology and management and can have an impact over a wide area. In retrospect, one of my biggest mistakes was leaving out Shanghai when we launched the four special economic zones. If Shanghai had been included, the situation with regard to reform and opening in the Yangtze Delta, the entire Yangtze River valley and, indeed, the whole country would be quite different.

Judging from what we have accomplished in recent years, it should be possible for our economy to reach a new stage every few years. We actually started the reform in 1980. In 1981, 1982 and 1983 it was carried out primarily in the countryside. In 1984 the focus shifted to urban areas. The years from 1984 to 1988 witnessed comparatively rapid economic growth. During those five years rural reform brought about many changes: grain output increased substantially, as did the peasants' income, and rural enterprises emerged as a new force. The purchasing power of peasants increased and many new houses were built. The "four big items" -- bicycles, sewing machines, radios and wristwatches -- entered ordinary peasant households, along with some more expensive consumer goods. The increase of farm and sideline products, the expansion of rural markets and the shift of surplus farm labour to rural enterprises stimulated industrial development.

In those five years the gross industrial output value amounted to more than 6 trillion yuan, with an average annual growth rate of 21.7 per cent. Production of processed food, clothing, housing, transportation and commodities for daily use, including major appliances such as colour TV sets, refrigerators and washing machines, increased by a wide margin. There was also substantial growth in the production of capital goods such as rolled steel and cement. Thus, agriculture and industry, rural areas and urban areas had a reciprocal impact, progress in one sector promoting progress in the other. This is a vivid, convincing model of the development process. It can be said that during this period China's wealth expanded considerably, and the economy as a whole was raised to a new level. In 1989 we began the drive to improve the economic environment and rectify the economic order, which I endorsed because it was plainly necessary. The overheated economy had resulted in a number of problems. For instance, the issuance of too much currency had led to major price rises, and there was much wasteful duplicate construction.

Nevertheless, what should be our overall assessment of the accelerated development in those five years? We might call it a leap, but unlike the Great Leap Forward of 1958, it did not damage the structure and mechanisms of economic development as a whole. In my opinion, the accelerated development of that period was no small contribution. Our three-year effort to improve the economic environment and rectify the economic order was a success. But in assessing that effort, we can say it was an achievement only in the sense that we stabilized the economy. Should not the accelerated development of the preceding five years be considered an achievement too? An achievement in one respect at least? Had it not been for the leap in those years when the economy rose to a new level, the readjustment of the following three years could not have been carried out so smoothly.

It seems to me that, as a rule, at certain stages we should seize the opportunity to accelerate development for a few years, deal with problems as soon as they are recognized, and then move on. Basically, when we have enough material wealth, we shall have the initiative in handling contradictions and problems. For a big developing nation like China, it is impossible to attain faster economic growth steadily and smoothly at all times. Attention must be paid to stable and proportionate development, but stable and proportionate are relative terms, not absolute. Development is the absolute principle. We must be clear about this question. If we fail to analyse it properly and to understand it correctly, we shall become overcautious, not daring to emancipate our minds and act freely. Consequently, we shall lose opportunities. Like a boat sailing against the current, we must forge ahead or be swept downstream.

The experience of other countries shows that some of them -- Japan, South Korea and parts of Southeast Asia, for example -- have gone through one or more periods of rapid development. Since we have the necessary domestic conditions and a favourable international environment, and since under the socialist system we have the advantage of being able to concentrate our forces on a major task, it is now both possible and necessary for us to bring about, in the prolonged process of modernization, several periods of rapid growth with good economic returns. We must have this ambition.

Rapid development of the economy can only be based on science, technology and education. I have said that science and technology are a primary productive force. How fast they have progressed over the past 10 or 20 years! One breakthrough in the field of high technology promotes the growth of several industries. Could we have developed so rapidly in recent years without science and technology? We must promote science, for that is where our hope lies. Over the past decade China has made substantial progress in science and technology; I hope still greater progress can be made in the 1990s. People in every field of endeavour should set a clear-cut strategic goal and reach it. China should take its place in the world in the field of high technology too. I am no professional, but I want to thank the scientists and engineers for their contributions to China and the honours they have won for our country. We should remember the days when scientists of the older generation, such as Qian Xuesen, Li Siguang and Qian Sanqiang, developed the atomic and hydrogen bombs, satellites and many other high technologies under extremely difficult conditions. It should be said that scientists are luckier today, so we can demand more of them.

I have said that intellectuals are part of the working class. Veteran and middle-aged scientists are important, and so are young ones. We hope all those who are studying abroad will come back. All overseas students may return and enjoy proper arrangements for their life and work, regardless of their previous political attitudes. This policy will not change. They should be told that if they want to make their contributions, it would be better for them to come home. I hope that concerted efforts will be made to accelerate progress in China's scientific, technological and educational undertakings. We should develop science and technology, and the higher and newer the technologies are, the better, and the more delighted we shall be -- and not just we, but the entire people and the state. We should all love our country and help to develop it.

IV

There are two tasks we have to keep working at: on the one hand, the reform and opening process, and on the other, the crackdown on crime. We must be steadfast with regard to both. In combating crime and eliminating social evils, we must not be soft. Guangdong is trying to catch up with Asia's "four little dragons" in 20 years, not only in terms of economic growth, but also in terms of improved public order and general social conduct -- that is, we should surpass them in both material and ethical progress. Only that can be considered building socialism with Chinese characteristics. Thanks to a strict administration, Singapore has good public order. We should learn from its experience and surpass it in this respect.

Since China opened its doors to the outside world, decadent things have come in along with the others, and evils such as drug abuse, prostitution and economic crimes have emerged in some areas. Special attention must be paid to these evils, and resolute measures must be taken to stamp them out and prevent them from spreading. After the founding of New China, it took only three years to wipe these things out. Who in this world has ever been able to eliminate the abuse of opium and heroin? Neither the Kuomintang nor the capitalist countries. But facts have shown that the Communist Party was able to do it.

Throughout the process of reform and opening, we must combat corruption. Cadres and Party members should consider it of prime importance to build a clean government. But we still have to rely on the law, which provides a firm guarantee. In short, so long as we develop our productive forces, maintain a reasonable economic growth rate, promote reform and opening and, at the same time, crack down on crime, we shall be able to build a socialist society with advanced ethical standards.

Throughout the process of reform and opening, we must also adhere to the Four Cardinal Principles. At the Sixth Plenary Session of the Twelfth Central Committee I said that the struggle against bourgeois liberalization must be conducted for twenty years. Now it seems it will take longer. The rampant spread of bourgeois liberalization may have grave consequences. It has taken the special economic zones more than ten years to reach the present stage. They can collapse overnight. Collapse is easy, but construction is difficult. If we don't nip bourgeois liberalization in the bud, we may find ourselves in trouble.

One of the basic concepts of Marxism is that the socialist system must be defended by the dictatorship of the proletariat. Marx once said the theory of class struggle was not his discovery. His real discovery was the theory of the dictatorship of the proletariat. History has proved that a new, rising class that has just taken power is, generally speaking, weaker than the opposing classes. It must therefore resort to dictatorship to consolidate its power. Democracy is practised within the ranks of the people and dictatorship over the enemy. This is the people's democratic dictatorship. It is right to consolidate the people's power by employing the force of the people's democratic dictatorship. There is nothing wrong in that. We have been building socialism for only a few decades and are still in the primary stage. It will take a very long historical period to consolidate and develop the socialist system, and it will require persistent struggle by many generations, a dozen or even several dozens. We can never rest on our oars.

V

The implementation of the correct political line must be ensured by a correct organizational line. In a sense, whether we can manage our domestic affairs well, whether we can keep to the socialist road and adhere to reform and the open policy, whether we can develop the economy more rapidly and whether we can maintain long-term peace and stability will all be determined by people.

The imperialists are pushing for peaceful evolution towards capitalism in China, placing their hopes on the generations that will come after us. Comrade Jiang Zemin and his peers can be regarded as the third generation, and there will be a fourth and a fifth. Hostile forces realize that so long as we of the older generation are still alive and carry weight, no change is possible. But after we are dead and gone, who will ensure that there is no peaceful evolution? So we must educate the army, persons working in the organs of dictatorship, the Communist Party members and the people, including the youth. If any problem arises in China, it will arise from inside the Communist Party. We must keep clear heads. We must pay attention to training people, selecting and promoting to positions of leadership persons who have both ability and political integrity, in accordance with the principle that they should be revolutionary, young, well educated and professionally competent. This is of vital importance to ensure that the Party's basic line is followed for a hundred years and to maintain long-term peace and stability. It is crucial for the future of China.

This is a pressing problem that has not yet been solved satisfactorily, and I hope it will be. I began to think about it when I resumed work after the "cultural revolution". When we found that it was impossible for our generation to ensure long-term peace and stability, we tried hard to find a third generation to succeed us and recommended a few persons. But that didn't solve the problem. Two persons who were chosen failed, and not with regard to economic issues; they stumbled over the question of opposing bourgeois liberalization. That was something we could not t olerate. In late May 1989 I said that we should boldly choose for the new leadership persons who were generally recognized as adhering to the line of reform and opening up and who had some achievements in that respect to their credit. This would convince the people that we were wholeheartedly committed to that line. The masses judge from practice. When they come to the conclusion that socialism is good and that reform and the open policy are good, our cause will flourish forever.

More young people should be promoted to positions of leadership. The present central leaders are rather advanced in years. Those who are a little over 60 are counted as young. They may be able to work for another 10 years, but 20 years from now they will be in their 80s, like me. They may be able to chat with people, as I'm doing today, but they won't have the energy to do much work. The current central leaders have been doing a good job. Of course, there are still quite a few problems in their work, but there are always problems in one's work. It is essential for old people like us to stand aside, give newcomers a free hand and watch them mature. Old people should voluntarily offer younger ones their places and give them help from the sidelines, but never stand in their way. Out of goodwill, they should help them when things are not being handled properly. They must pay attention to training successors of the next generation. The reason I insisted on retiring was that I didn't want to make mistakes in my old age. Old people have strengths but also great weaknesses -- they tend to be stubborn, for example -- and they should be aware of that. The older they are, the more modest they should be and the more careful not to make mistakes in their later years. We should go on selecting younger comrades for promotion and helping train them. Don't put your trust only in old age. I was already in a high position when I was in my 20s. I didn't know as much as you do now, but I managed. More young people must be chosen, helped, trained and allowed to grow. When they reach maturity, we shall rest easy. Right now we are still worried. In the final analysis, we must manage Party affairs in such a way as to prevent trouble. Then we can sleep soundly. Whether the line for China's development that was laid down at the Third Plenary Session of the Eleventh Central Committee will continue to be followed depends on the efforts of everyone, and especially on the education of future generations.

One of our problems today is formalism. Every time you turn on the television, you see a meeting being held. We hold countless meetings, and our articles and speeches are too long and too repetitious, in both content and language. Of course, some words have to be repeated, but we should try to be concise. Formalism is a kind of bureaucratism. We should spend more time on practical matters. That means saying less and doing more. Chairman Mao never held long meetings, his essays were short and concise and his speeches succinct. When he asked me to draft the work report to be delivered by Premier Zhou Enlai at the Fourth National People's Congress, he said it should be no more than 5,000 Chinese characters. I kept to 5,000 characters, and they were enough. I suggest you do something about this problem.

In studying Marxism-Leninism we must grasp the essence and learn what we need to know. Weighty tomes are for a small number of specialists; how can the masses read them? It is formalistic and impracticable to require that everyone read such works. It was from the Communist Manifesto and The ABC o Communism that I learned the rudiments of Marxism. Recently, some foreigners said that Marxism cannot be defeated. That is so not because there are so many big books, but because Marxism is the irrefutable truth. The essence of Marxism is seeking truth from facts. That's what we should advocate, not book worship. The reform and the open policy have been successful not because we relied on books, but because we relied on practice and sought truth from facts. It was the peasants who invented the household contract responsibility system with remuneration linked to output. Many of the good ideas in rural reform came from people at the grass roots. We processed them and raised them to the level of guidelines for the whole country. Practice is the sole criterion for testing truth. I haven't read too many books, but there is one thing I believe in: Chairman Mao's principle of seeking truth from facts. That is the principle we relied on when we were fighting wars, and we continue to rely on it in construction and reform. We have advocated Marxism all our lives. Actually, Marxism is not abstruse. It is a plain thing, a very plain truth.

VI

I am convinced that more and more people will come to believe in Marxism, because it is a science. Using historical materialism, it has uncovered the laws governing the development of human society. Feudal society replaced slave society, capitalism supplanted feudalism, and, after a long time, socialism will necessarily supersede capitalism. This is an irreversible general trend of historical development, but the road has many twists and turns. Over the several centuries that it took for capitalism to replace feudalism, how many times were monarchies restored! So, in a sense, temporary restorations are usual and can hardly be avoided. Some countries have suffered major setbacks, and socialism appears to have been weakened. But the people have been tempered by the setbacks and have drawn lessons from them, and that will make socialism develop in a healthier direction. So don't panic, don't think that Marxism has disappeared, that it's not useful any more and that it has been defeated. Nothing of the sort!

Peace and development are the two major issues in the world, and neither one has been resolved. Socialist China should show the world through its actions that it is opposed to hegemonism and power politics and will never seek hegemony. China is a steadfast force for safeguarding world peace.

We shall push ahead along the road to Chinese-style socialism. Capitalism has been developing for several hundred years. How long have we been building socialism? Besides, we wasted twenty years. If we can make China a moderately developed country within a hundred years from the founding of the People's Republic, that will be an extraordinary achievement. The period from now to the middle of the next century will be crucial. We must immerse ourselves in hard work: we have difficult tasks to accomplish and bear a heavy responsibility.