Markets Over Mao

Somewhat perversely and completely inaccurately, China’s economic success may be seized upon by anti-capitalists who advocate a larger role for the state or the government in the economy, and a correspondingly smaller role for the market or the private sector. The government continues to play a much larger role in the Chinese economy than in full-fledged market economies such as America. For example, when Beijing dismantled socialist commune farms in 1978 in one of the most important market-oriented economic reforms and gave farmers the freedom to manage their individual plots of land, it kept ownership of land and gave the farmers 30-year leases. State ownership of farm land is just one example of the state’s dominance of many parts of the economy. The visible hand of the government still remains all too obvious in China, and China has a long way to go before it becomes a market economy…