Socialist market economy
The socialist market economy is seen by the Communist Party of China as an early stage in the development of socialism (this stage is variously called the "primary" or "preliminary" stage of socialism), where public ownership coexists alongside a diverse range of non-public forms of ownership. The Communist Party of China maintains that despite the co-existence of private capitalists and entrepreneurs with public and collective enterprise, China is not a capitalist country because the party retains control over the direction of the country, maintaining its course of socialist development. Proponents of this economic model distinguish it from market socialism as market socialists believe that economic planning is unattainable, undesirable or ineffective and thus view the market as an integral part of socialism whereas proponents of the socialist market economy view markets as a temporary phase in development of a fully planned economy.
Primary stage of socialism
While the CPC pursued non-orthodox economic policies, it believed the party would be able to safeguard China's goal of socialist development by transforming Marxism into a dominant value system. This was reflected by the introduction of the term "socialist spiritual civilization", a concept introduced in 1981 and mentioned in the Political Report to the 13th National Congress. The main function of socialist spiritual civilization was to check against the dangers of ideological retreat in the party's effort to progress toward socialism. A CPC resolution in 1986 said, "we will be not able to guarantee the socialist direction of our modernization course, and our socialist society will lose its goals and ideals" if the party stopped upholding Marxist doctrine. However, because the material base, officially referred to as material civilization, created by the economic reforms did not conform with Marxist analysis of socialism, the CPC concluded that in the new era Marxism would be given the role as the dominant value system, which entailed that other value systems could be accepted but these systems could not negate Marxism.