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.
History of the People's Republic of China (1976–1989)
In late 1978, many emboldened people began staging rallies and protests in Beijing. They erected a large number of wall posters (the so-called "Democracy Wall") criticizing the Cultural Revolution, Mao Zedong, the Gang of Four, and Hua Guofeng. All these were tolerated because of being more-or-less in line with official positions, but some began calling for democracy and open elections. This was more than the authorities were willing to tolerate and they quickly stressed that the party would continue to hold power and guide the nation towards socialism. While greater freedom of thought would be allowed, loyalty to the party and socialist thought would still be required. Nonetheless, writers began criticizing corruption, privileges enjoyed by party officials, and unemployment, all things that supposedly could not exist under socialism. It was now officially admitted that 20 million Chinese were unemployed and 100 million did not have enough food to eat.