Page 17 - SELECTED WORKS OF ZHOU ENLAI Volume II

FINANCIAL AND ECONOMIC SITUATION 15

production figures. The recovery of agriculture will serve as the
foundation for the recovery of all other branches, since if no food is
available, everything else is out of the question. Light industry and
exports depend for the most part on agriculture for raw materials and
goods. With the exception of military and administrative expenditures,
most of the funds in the state plan are allocated for the recovery of
production. Only when production is resumed can the enterprises take
in several million additional people transferred from elsewhere.
3. Broadening sources of income and reducing expenditures. This
may sound like a platitude, but it is still a necessary measure. More
funds will be available and deficits will be reduced only when rev-
enues increase. The state will rely mainly on the people for new
sources of revenue. First, the countryside will share the burden;
second, the cities will make a contribution; third, state enterprises
will hand over their income; and fourth, we shall draw in advance —
that is, borrow money.
I want to elaborate first on the share of the burden to be borne
by the countryside. Our old liberated areas have been shouldering a
heavy burden for a long time; they haven’t had a breathing spell in
all the 12 years since the beginning of the War of Resistance Against
Japan. Now that nationwide victory is just around the corner, is it
possible to lighten their load? It is a reasonable suggestion, but for
the time being we can’t do it. This is because the war is still going
on, things in the newly liberated areas are not yet well organized,
agrarian reform has not been carried out, and preparations for
collecting taxes have not been completed. So the old liberated areas
will still have to carry the largest share of the burden, and the amount
cannot be reduced. The burden on the peasants in the Northeast will
be the heaviest, it will be light in the Northwest and moderate in
north China. Those are the proportions we have worked out on the
basis of our experience since the anti-Japanese war. On an average,
each peasant harvests about 200 kg. of grain every year, of which 40
kg. are turned over to the government. If the expenses of the military
are calculated in terms of grain, they come to 2,000 kg. per capita per
year. That means that every 100 peasants can support two government
employees. If this ratio is maintained, things will be just right; if it
is broken, things will be difficult. For the last 12 years we have held
out by keeping this ratio. As their share of the burden, the peasants
will still have to contribute about 20 per cent of their income for a