The first economic crisis cycle (1958-1968)

From 1958 to 1960, the crisis occurred. The government fiscal deficit was about 6 billion yuan in 1958 and reached 10 billion yuan in 1960, accounting for 5.6% of that year's revenue. The total deficit reached 20 billion yuan in three years. At that time, the highest fiscal revenue was only about 60 billion yuan, which was high. The deficit has taken away fiscal expenditures used to expand reproduction and increase employment opportunities. After 1960, due to the decline in fiscal investment capacity and the serious lack of employment, the government had to mobilize about 20 million urban residents to work in rural areas to help themselves in order to solve the urban unemployment problem.

1960-1962, economic depression. The national fiscal year revenue further dropped from 57.23 billion to 31.36 billion. It can be seen from the government statistics of the 1960s that were revised and publicly published in 1982 that the population growth curve in the three years from 1960 to 1962 showed a downward trend. The "unincreased population" was approximately 20 million people, most of which could be Thought to die of starvation. People call it the "three-year natural disaster".

1962-1963, economic recovery. Under the pressure of the comprehensive crisis, the government reformed the people's commune-governed economy of "one big city and two public houses" into a "team-based" village economy, loosened the government's overall control over the rural grassroots, and allowed farmers to engage in "three-self-one-guarantee" (this kind of The economic reform characterized by liberalization was repeated 15 years later, but it was renamed the "large contract responsibility system". Therefore, agricultural production has fully recovered, the supply of agricultural products has increased year after year, and the proportion of agricultural tax revenue in fiscal revenue has also increased. 8% rose to 22%, and the financial situation has improved.

At this time, as the differences in economic policies and political line struggles among the central leaders became more and more obvious; and the "socialist education movement" was unable to solve the problem of grassroots class struggle, so The "Cultural Revolution" is in its incubation stage.

1963-1966, a period of upsurge. After the economic situation initially improved, the country increased investment in industry, which accelerated economic development, but then the fiscal deficit reappeared... Subsequently, from 1968 to 1972, millions of urban "educated youth" rushed to the countryside. The reason still lies in the city's insurmountable high unemployment rate.

After that came the special historical stage of the Cultural Revolution. Although the role of non-economic factors is obviously greater than the role of economic factors at this stage, they only prolong the pain of the crisis period.

1.04 The second economic crisis cycle (1978-1986)

In 1978-1979, the crisis occurred. Since the national fiscal deficit exceeded the 10 billion mark in 1974, it has been losing money year after year. By 1978-1979, the deficit further increased to about 20 billion per year, accounting for about 20% of revenue, which was lower than the proportion during the last crisis. 5% higher. The reasons are not only the impact of the "Cultural Revolution" on the economy, but also the "Yang Leap Forward" - large-scale borrowing for investment in basic industries; and the Sino-Vietnamese border war, which caused about 5 billion direct non-budgetary expenditures, etc.

From 1980 to 1981, the economic depression caused the government to once again adopt the policy of "liberalization", gradually lifting control over rural areas, reducing agricultural taxes, increasing prices of agricultural products, and allowing farmers to contract land and conduct household operations. Open market trade. This is the first step in rural reform. It is also a replica of the "three-self-one-guarantee" policy adopted last time to alleviate the crisis.

The same thing as the last economic crisis is that cities have adopted "closing, suspending, merging, and transferring" to reduce investment in infrastructure, causing millions of infrastructure workers to "stop working and waiting for materials" and tens of millions of urban residents. "Unemployed"; the difference is that the Mao Zedong era ended after the "April Five-Year Plan" incident in 1976. The post-totalitarian system lacks a paramilitary national mobilization mechanism and can no longer force urbanites to go to work as it did in the early 1960s. The rural areas have come to solve the unemployment problem. Therefore, the crime rate has increased, the "two strikes" campaign has been carried out across the country, and the prisons have become overcrowded.

1982-1983, the recovery stage. Due to the nationwide redistribution of rural land and the opening of the free market for agricultural products, grain production increased by a record 20% every year, with the total increase in the three years from 1982 to 1984 being approximately 7.5 billion tons. For the first time, Chinese farmers used their own efforts to solve the problem of food. At the same time, the agricultural output value also increased to 40% of the total industrial and agricultural production value.

1984-1986, the upsurge stage. The growth rate of industrial output value accelerated, and the fiscal deficit increased to approximately 10 billion yuan per year during the same period. One of the more important reasons is the "unit ownership" role of state-owned assets formed after the "profit-to-tax reform" in 1982. Due to the low interest rate policy of state monopoly finance and the free government financial investment, compared with the higher price level, any unit's investment itself means eating interest differentials; and due to the "isomorphism of interests" within the unit, fixed Generally, 40-50% of the total asset investment will be converted into consumer funds through various channels. Therefore, since 1983, non-productive construction investment has also increased significantly. Under the dual expansion pressure of investment and consumption, the contradiction between supply and demand and the excessive amount of currency converted from deficits finally triggered a comprehensive inflation crisis.