Comrade Truong Chinh’s contributions to renewing the Party’s economic thinking

Throughout its 30 years of innovation, the country has attained great historically significant achievements. The GDP grew from US$6.5 billion in 1990 to US$204 billion in 2015, an increase of 31.4 times. GDP per capita reached about US$2,250 in 2015. Living standards and all aspects of social life have been considerably improved. It is hard for the young generation today to imagine the country before the national renewal - Doi moi - how poor the Vietnamese people were and the difficulties and challenges the leaders had to face at that time.

Before the national renewal, poverty was a present force in almost all families and among almost all people. Most people had to eat noodles, sorghum or a little rice with banana roots, spinach, kohlrabi leaves, and sweet potatoes.

During these hard years, many leaders sought foreign aid and borrowed food with interest for their people. Embargos from hostile countries and subjective errors in economic management also made the society fall into decay. “The price adjustment in late 1981 raised the prices of numerous commodities, but did not equivalently adjust salaries. That resulted in rapid inflation, and made the life of cadres, workers, officials, and armed forces extremely difficult. Social evils became rampant, and society became more and more depraved”⁽¹⁾.

In face of the country’s hardships and poverty, “General Secretary Truong Chinh always concerned himself with these matters and realized that it was impossible to continue building socialism alongside the existing policies and management mechanisms”⁽²⁾. He realized the people’s hunger and poverty, the flaws in current Party’s guidelines and the Party’s weaknesses.

In late 1982, Truong Chinh set up a group of scholars to research Vietnam’s theoretical and realistic problems and used this research as a scientific basis to determine the necessary steps for the building of socialism in Vietnam. Between 1983 and 1985, he carried out surveys in Dak Lak (April 10-14, 1983), Gia Lai - Kon Tum (April 15-19, 1983), Lam Dong (July 18, 1983); listened to socio-economic reports of Ho Chi Minh City in Da Lat (July 20, 1983); and visited Hanoi’s new economic zone in Lam Dong province (August 1983), Dong Nai (August 21-22, 1983), Vung Tau - Con Dao (August 23-25, 1983), and Long An (January 11-15, 1984)... Those surveys contributed to his numerous ideas at the Party Central Committee plenums and the Politburo’s meetings. The 6^th Plenum of the Party Central Committee (5^th tenure) discussed and issued a resolution on “Urgent tasks in the improvement of economic management” (July 3-10, 1984): “Truong Chinh proposes that the current economy requires a dynamic management mechanism with the ability to abolish bureaucracy, conservativeness, sluggishness and uncontrolled subsidies, and to effectively implement democratic centralism. The subsidy mechanisms of the last years falsify the national economic picture. It is time to carry out real business accounting. First, Vietnam have to post cost prices that fully reflect production costs, abolish formalism, and restore honesty within economic operations”⁽³⁾.

At the 7^th and 8^th Plenums of the Party Central Committee (5^th tenure), Truong Chinh suggested abrogating the economic model in kind and the centrally planned subsidized economic mechanism⁽⁴⁾.

In terms of mistakes in the price policy, Truong Chinh affirmed that it was time to alter and implement the one-price policy. However, this thought was not accepted at the 6^th Plenum of the Party Central Committee (5^th tenure).

Beside price, salary was the next issue to be concerned. He thought that salary represented a laborers’ investment. He also suggested that: “To solve the problem of salary is to solve production and save the working class”⁽⁵⁾.

At the 7^th Plenum of the Party Central Committee (5^th tenure, December 11-17, 1984), which discussed the Directions, tasks and socio-economic plans of 1985, and the building and strengthening of districts, Truong Chinh resolutely emphasized that: “in order to create positive change and prepare for the Party’s 6^th National Congress, there is no way but to rapidly shift from subsidy to business self-accounting with a goal of eliminating formalism and artificiality and restoring the truthfulness of economic operations to prepare for the reforms”⁽⁶⁾. His idea was accepted and introduced into the Resolution.

After the Plenum, Truong Chinh continued his surveys in Nghia Binh, Quang Nam, and Da Nang. These provinces had succeeded in implementing the Resolutions of the 6^th and 7^th Plenums of the Party Central Committee (5^th tenure). He worked with the leaders of Ho Chi Minh City Party Committee from January 16-19, 1985, and visited factories and farms. He visited Long An for a second time (January 23-24, 1985), as well as An Giang, Dong Thap, Can Tho, Ha Son Binh, and Hanoi. After his surveys, Truong Chinh affirmed at two Politburo meetings (May 13 and May 31, 1985): “It is time to decisively abolish the subsidy mechanism, and dissect and reject this dangerous ulcer as soon as possible”⁽⁷⁾.

Entrusted by General Secretary Le Duan, Truong Chinh presided at the 8^th Plenum of the Party Central Committee (5^th tenure) from June 11-17, 1985, and discussed the reformations to repeal the system based on price and salary administrative subsidies and instate a socialist business self-accounting economy. He pointed out that “the Resolution of the 8^th Plenum of the Party Central Committee will end administrative orders’ control of the economy, a significance of the centrally planned subsidized mechanism, and open a period where the economy is regulated on the basis of correctly using objective rules through planning associated with socialist economic and business accounting”, and requested that the Party Central Committee “reach a unanimous resolution on principle to switch to business self-accounting. It is necessary to provide input and prepare output policy when retailing, and to implement the one-price policy within economic operation”⁽⁸⁾.

The 8^th Plenum of the Party Central Committee (5^th tenure) discussed reforms in the fields of circulation and distribution while recognizing the laws of commodity production.

However, after the Plenum, the socio-economic situation remained difficult. Truong Chinh analyzed and showed the mistakes and shortcomings in administering the policy of price - salary - currency, which was the cause of the difficulties. Those mistakes and shortcomings were as follow:

“First, separate the abolishment of subsidies from the abolishment of bureaucracy. Price - salary - currency adjustment is not conducted simultaneously with the grassroots discretion to switch to business self-accounting. Although we have made many steps in the reduction of subsidies, we have hardly inched in reducing centrally-based bureaucracy, which creates a serious imbalance. Obviously, we have paid attention to adjusting prices and salaries, but we have also made light of management mechanism reforms.

Second, new policies and the arrangement of their implementation are not synchronous. The new policy of removing bureaucracy and subsidies and switching to socialist business self-accounting requires implementers to thoroughly understand the issues and enthusiastically overcome difficulties. The Resolution of the 8^th Plenum of the Party Central Committee mentioned this issue, but it has not yet been carried out.

Third, while the Resolution of the 8^th Plenum of the Party Central Committee has not been deployed, and a new management mechanism has not been formed, Vietnam conducted money modification passively. It is possible to solve financial difficulties in another way. The process of money modification faced shortcomings in method and professional competence; it does not start from the requirement to step up production, but from the requirement for cash management in the way of bureaucratic centralism”⁽⁹⁾.

With his innovative thinking, Truong Chinh affirmed that it was necessary to “make every effort to produce agricultural and industrial products; the circulation system should be appropriate for the commodity production”.

Truong Chinh was also the first person who suggested taking “a standpoint of strengthening the State machinery, and separating the function of administrative management from the function of production and business management.” He also said that “it is necessary to elucidate the concept, content, and limit of administrative management to ensure that the State holds fast to management rights and control of the whole economy, and plans the development strategy for every locality, every industry and the whole country. The State also ensures that the law is strictly and clearly enforced... The function of production and business management is entrusted to establishments, factories and companies. In order to implement the function of production and business management, economic units have to strictly observe State laws and implement plans through economic contracts; find ways to overcome difficulties, ensure effective business, and contribute to the industrialization of the country”⁽¹⁰⁾. This was an initial step of later administrative reforms.

In the late 1980s, the struggle between the old and the new was very complicated. Even when the Party Central Committee and the Politburo’s resolutions were enacted, different points of view still existed, which led to differences in action.

On February 24, 1986, the Politburo had a meeting and issued Resolution 31 on the urgent methods to implement the Resolution of the 8^th Plenum of the Party Central Committee (5^th tenure). At the Plenum, Truong Chinh self-criticized in front of the Politburo. He said that the Politburo, including himself, “approved a number of wrong decisions, including cadres assignment without correcting them in a timely manner, did not clearly express ideas in order to prompt discussion and reach unanimity, and did not persist in defending the right and fully analyzing the wrong... Those are the shortcomings of the Politburo”⁽¹¹⁾. Truong Chinh was a good example of self-criticism for the shortcomings of himself and of the Party.

Truong Chinh continued his contributions to economic thinking reform after he became the Communist Party of Vietnam’s General Secretary (from July 14, 1986). He thought that “The national socialist revolution required innovative thinking, especially concerning the economy, working styles, organization, and cadres. The 6^th Party Congress had to meet that requirement. Innovation must be expressed in Party documents, first in the Political report and then in staffing the Central Party and executive committees at all levels, at local Party congresses and the Party National Congress”⁽¹²⁾.

Truong Chinh summarized three important lessons: First, the strength of a country and a revolution is in the people. Second, respect objective rules and apply them to reality. Third, maintain and strengthen the Party’s leadership⁽¹³⁾.

At the 6^th National Congress of the Party held in Hanoi in December 5-12, 1986, Truong Chinh read the Political Report of the Party Central Committee (5^th tenure). Presided by Truong Chinh, the Congress concluded successfully with an innovative spirit, and opened a new page in the history of the Party, the country, and the people.

Truong Chinh’s innovative economic thinking and its influence on the economic sector still exists today. His contributions to the economic growth model include the enhancement of growth quality, and an increase in labor productivity, economic efficiency, and economic restructuring. The socialist-oriented market economy’s innovation helped modernize and complete the economy, mobilized all resources for development, and encouraged creativity so that Vietnam could truly become a strong country with prosperous people and a democratic, equitable, and civilized society.

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(1), (2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12), (13) The program for compiling biographies of leaders of the Party and the State: Biography of Truong Chinh, pp.585-586, 586, 593-594, 594, 597, 606, 606, 610, 621-622, 625, 633, 646, 640-643.

Assoc. Prof., Dr. Le Quoc Ly

Deputy Director

Ho Chi Minh National Academy of Politics