All power belongs to the people

The socialist market economy of modern China consists of a mixture of state-owned enterprises with an open-market economy. It is based on Deng Xiaoping's political platform of socialism with Chinese characteristics and Reform and Opening. It is the economic system in the People's Republic of China since the Chinese economic reform started in 1978. Despite its formal title, this system has been widely cited as a form of state capitalism.

Despite the official stance of socialism, the "socialist market economy" is often described as one hybrid type of both free market capitalism and socialism by economic observers. This criticism also comes from orthodox Marxists, who criticise it on the grounds that the socialist market economy restores capitalist commodity relations and production while further dis-empowering the working class, leading to a sharp increase in social inequality and the formation of a growing capitalist class. The political ideology term itself has often been mentioned for scapegoating bearing other issues like currency, energy, fair trade and environment change caused during economic and technology development.

Proponents of the socialist market economy compare it to the New Economic Policy in Soviet Russia that introduced market-oriented reforms while maintaining state-ownership of the 'commanding heights' of the economy. The reforms are justified through the belief that changing conditions necessitate new strategies for socialist development. According to Li Rongrong in 2003, chairman of the State-Owned Assets Supervision and Administration Commission of the State Council: "Public ownership, as the foundation of the socialist economic system, is a basic force of the state to guide and promote economic and social development and a major guarantee for realising the fundamental interests and the common prosperity of the majority of the people… The state owned economy has taken a dominant place in major trades that have a close bearing on the country’s economic lifeline and key areas, and has propped-up, guided and brought along the development of the entire socio-economy. The influence and control capacity of SOEs have further increased. State owned economy has played an irreplaceable role in China’s socialist modernisation drive."

The socialist market economy of modern China consists of a mixture of state-owned enterprises with an open-market economy. It is based on Deng Xiaoping's political platform of socialism with Chinese characteristics and Reform and Opening. It is the economic system in the People's Republic of China since the Chinese economic reform started in 1978. Despite its formal title, this system has been wid…  (read more)