Socialist market economy
The socialist market economy (SME) is the economic system and model of economic development employed in the People's Republic of China. The system is based on the predominance of public ownership and state-owned enterprises within a market economy. The term "socialist market economy" was first used during the 14th National Congress of the Communist Party of China in 1992 to describe the goal of China's economic reforms. Originating in the Chinese economic reforms initiated in 1978 that integrated China into the global market economy, the socialist market economy represents a preliminary or "primary stage" of developing socialism. Despite this, many Western commentators have described the system as a form of state capitalism.
Ideology of the Communist Party of China
The basic conflict between the Maoists and the Dengists was if China after 1949 had reached socialism or not, and what it would entail. In the aftermath of the Great Leap Forward and the Sino–Soviet split Mao himself, was even unsure if China had reached the socialist mode of production. In 1962 he reached the conclusion that China, despite having nationalized the means of production, had not reached the socialist mode of production in its mature form, claiming that the principle conflict as existing in China was between the proletariat and the "new bourgeois elements", which were constantly reproduced, and other enemies of the revolution. This view led Mao to introduce to the Cultural Revolution. Unlike Mao, who gave priority to superstructural elements, Deng argued in 1956 in the "Report on the Revision of the Constitution of the Communist Party of China", that socialism had taken root in socialism, since private property had been abolished, since nationalization of property Deng argued (again following the basic premises of classical Marxism) entailed removing the basis of other classes reproducing, stating;
Casual labourers and farm labourers have disappeared. Poor and middle peasants have all become members of agricultural producers' co-operatives, and before the distinction between them will have become merely a thing of historical interest ... The vast majority of our intellectuals have now come over to the side of the working class ... The conditions in which the urban poor and the professional people used to exist as independent social strata are virtually no longer present ... What is the point, then, of classifying these social strata into two different categories? And even if we were to try to devise a classification, how could we make it neat and clear-cut?
In contrast to Mao, Deng argued that the principal contradiction in Chinese society was the backwardness of the productive forces, further adding that the Party's "central task" over the coming years were to develop them. In addition he believed that China, since 1957, had been unable "to figure out what socialism is and how to build it". He criticized Mao's policies, particularly those after 1957, arguing that the CCP had "wasted twenty year."