1988 China "price Break Through The Barrier Study

Prices, as the most sensitive and most prominent problem in China's economic development and structural reform, also is the most talked about topic of men and women, cadres and the masses in daily life. As early as 1980, Professor Bruce in the World Bank predicted that all the socialist country's economic reform will be"stuck"in the price issue finally. If the price issue is resolved, the reform will continue to move forward. On the contrary, Reform will stagnate or regress. In fact, in any society, price plays a vital role,no matter what position the social system places in the categories of capitalism or communism, and what level its economy has reached. Because of the impact of domestic and international situation and price requirements of its own law of development of the dual role, China began the process of price reform in 80 years in the 20th century.The direction and process of price reform depend on the direction of economic reform and strategic steps fundamentally. China's market economy system was established through a"tortuous"with a"steady progress"in the process. Viz. from the"planned economy, supplemented by a market economy"to"planned commodity economy", and then to"socialist market economy". In this process, the price mechanism's market reform was undoubtedly the"breathtaking leap", the success or failure of reform and the establishment of market institutions,"woe".However, due to the long impact by the"Left"tendencies, before the third plenum of the 11th CPC congress, the law of value and commodity economy in China were seen as critical areas of capitalism, prices and wages were in a frozen state for a long time.. At the same time, price system violated the law of value seriously. Kicked off after the reform and opening up, price system and mechanism reform also started accordingly. Before 1984, price reform in general was still limited to the original plan within the framework of the economic system. The main content of the reform was a modest adjustment to the irrational price parity and difference of planned price system. The main idea of the reform was"combination of adjustment and liberalization, the former dominated". That is, eased only after supply and demand situation, the commodity price which less impact on the entire national economy could be released.Between 1979 and 1984, China's price reform has made remarkable achievements in the accumulated valuable experience at the same time, reform for strengthening, deepening reform, expanding the extent and areas of reform provided an opportunity. In the"combination of liberalization and adjustment, the former dominated"under the guidance of reform ideas, states canceled a planned program outside the price not be higher than 20% of the price limit in January 1985, which marked the"dual track"pricing policy be put into effect. In addition, the thought collision between China's theorists and the central level had a significant impact on the establishment of this policy.Price"dual system"is necessarily the production of rationality, but its negative impact can not be avoided. Therefore, for the pros and cons of the"dual track"and its presence or repealed, Economy engaged in a fierce debate. With the disadvantages of the"dual pricing system"gradual exposure, especially the huge difference between plan prices and unplanned price giving birth to a new"profiteers"class, and the growing chaos due to the increasing spread of"rent-seeking"and corruption, policy-makers in 1986 had begun to consider the merger proposal as soon as possible. But for various reasons, as the main part of price in the merger scheme,"Price, tax, financial linkage"program was delay introduced.Because of the implementation of the price dual-track system causing the"profiteering"prevalent and serious market injustice, unplanned production prices were rising, inflationary pressures increased, economic reform entered the stage of stalemate. Consequently, in the"better a finger off than always aching"under the influence of the idea, the idea of forcibly and quickly merged gradually took hold. In 1988 the Government decided to release the price control and cancel the dual pricing system. By the implementation of"break through the price barrier", made the completion of the merger price true. As a result, this became a direct result of the national large-scale inflation. Coupled with weak capacity of the masses and other complex psychological factors, panic buying swept the country began to rise. Not yet had a relaxed environment and sufficient conditions for the radical"checkpoints"decision-making suffered.Faced with the grim economic situation, the Third Plenary Session of the Thirteenth made the management of economic environment, rectifying the economic order, a comprehensive policy of deepening the reform in September of 1988. Meeting decided to highlight the economic environment into the governance and rectify the economic order up as the focus on reform and development for the two years of 1989 and 1990. For the so-called"profiteering"and caused great social chaos, the Fifth Plenum of the 13th Central Committee of the Communist Party of China made"rectification and further deepen the reform of the decision"further in November of 1989. This meant that the path of price reform return to the steady progress. The radical ideas of"step by step, and steadily"about price reform re-replaced the"break through the price barrier".In the rectification period, the double-track price became more and more close to each other. Early the 1990s production prices of dual-track pattern ended finally. At last,"dual track"price quietly merged. With the establishment of market economic reform target model in 1992, the reform of price system moved into the formative stages and improvement phase of the price mechanism of formation and operation which lined with market economy mechanism. On the contrary, because of the deviation of the reform and other reasons, Soviet and East European countries appeared a serious social unrest and economic crisis in the late 1980s early 1990s. Definitively, reforms fell to a low ebb. A comparative study at home and abroad visible, Progressive Reform in China's historical rationality is evident.Worth noting is, that description, which price reform was difficult in the 1980s, while successfully broke through the barrier during the early 1990s, not only can not people understand why the price reform of the history of the first help themselves, also not understood why the problem so easy to solve, energy and other basic goods prices still plague us today, although the market economy system experienced another ten years'construction. Hence, in the 90th anniversary of the communist party of China, brush the dust of time and man-made painting to restore the true face of history, from an elongated lens to a more three-dimensional and objective perspective shows the process of price reform in China many fragments, to correct understanding of the reform and opening-up course and outlooking the prospects of price reform, is obviously not a simple review journey, but has a remarkable historical significance and practical enlightenment.