Citing the strict prevention and control measures of the COVID-19 pandemic, including the distribution of medical supplies and daily necessities, some people said China is returning to a planned economy. It’s ridiculous.
People who equate anti-pandemic measures with the planned economy are exposing their outdated thinking. They believe that there is only one form of market economy, and that is the capitalist free market economy represented by the United Kingdom and the United States.
The fact is that China has practiced the socialist market economy for more than four decades. The laws and principles of the market economy are not immutable. Nor is the market economy confined to one model. On the contrary, its forms are varied.
Factors such as history, culture and national conditions determine the form of market economy a country adopts. For example, countries such as France, Germany, Japan and the Republic of Korea have developed forms of market economy with characteristics different from those of the United Kingdom and the United States.
France’s market economy is characterized by government planning and direction because centuries ago France, while embracing mercantilism, realized the importance of state intervention in economic policy. German economists, who also emphasize the role of the state in the economy, developed a form of market economy in which the market provides efficiency and the government guarantees stability and fairness.
The form of market economy followed by Japan and the Republic of Korea highlights the importance of industrial policy. The use of industrial policy to achieve socio-economic development goals set by the government is a distinctive feature of the market economy of both countries.
However, a model of a market economy that works in one country does not necessarily succeed in another, because the conditions from one country to another are not the same. Thus, a country that blindly follows another country’s development model, regardless of its conditions, is doomed to failure.
Under the leadership of the Chinese Communist Party, China adheres to the socialist market economy. China has developed a socialist market economy that combines the advantages of socialism and the market economy, including the decisive roles of the market and government in allocating resources and redistributing wealth respectively, creating the effect “one plus one greater than two”.
However, the market cannot dominate everything and decide everything, even in a market economy. The government must exercise control over certain areas, especially those related to the fundamental interests of the population and public security, in order to better protect the general interests of society.
Human values are undoubtedly more important than economic benefits in areas such as health care, basic education and basic research in science and technology. For example, since the pandemic outbreak, large numbers of health workers, at the behest of the Party, have rushed to infection areas to help contain the spread of the novel coronavirus, largely because China has always put saving lives ahead of economic interests.
China has stepped up its efforts to contain the Omicron variant, as normality is a prerequisite for economic recovery and sustainability. China’s strict measures have largely contributed to containing the pandemic due to the leadership of the Party and the advantages of the socialist market economy.
The socialist market economy also allowed the government to play its role in the economy, including organizing and mobilizing thousands of people to achieve a goal. These leaders of free-market economies criticize China’s tough measures because they may not be able to mobilize the public to help contain the pandemic. No wonder they chose to “lie flat” and co-exist with the virus.
The socialist market economy combines the advantages of the market and the government, which paves the way for the effective implementation of anti-pandemic measures. Unlike the planned economy, in which the entire economic system worked exactly as planned, leading to inefficiency, the socialist market economy helps both the market and the government play their respective roles. And China’s success in effectively implementing anti-pandemic measures shows the superiority of the socialist market economy.
The author is a professor at the School of Economics of Renmin University of China.
Opinions do not necessarily represent those of China Daily.