Chapter 77 The Jedi recovery of state-owned enterprises

Before Zhu Rongji became the vice premier of the State Council, the reform of state-owned enterprises had always been to decentralize power and transfer profits and implement the contracting system as the main means. Until June 1992, the State Council also promulgated the "Regulations on the Transformation of Operational Mechanisms of Industrial Enterprises Owned by the Whole People", giving enterprises 14 operating autonomy right.However, these various decentralization measures that attempted to circumvent clear property rights proved to be extremely unsuccessful.After entering 1995, the operating conditions of state-owned enterprises continued to deteriorate, almost to the point of being unsustainable. According to a report by the Development Research Center of the State Council, the loss of state-owned enterprises exceeded 40%, and the average corporate debt ratio was as high as 78.9%. Compared with a year ago, assets increased by 4.1 times and debts increased by 8.6 times.

Zhu Rongji quickly gave up the idea that had been followed for more than ten years.He believes that the country is already unable to take care of hundreds of thousands of "natural sons" and must give up. On September 28, 1995, the Fifth Plenary Session of the Fourteenth Central Committee of the Communist Party of China passed the "Suggestions of the Central Committee of the Communist Party of China on Formulating the Ninth Five-Year Plan for National Economic and Social Development and the Long-term Goals for 2010", which put forward new ideas for the reform of state-owned enterprises. Announced the implementation of the reform strategy of "grasping the big and letting go of the small".

The so-called "grasp the big" means to imitate the big company model of Japan and South Korea, select some enterprises with market competitiveness, support them in financial and credit policies, and make them grow rapidly through the "industry-finance" mixed business model. In 1996, the central government clarified various credit support policies for 300 of the 1,000 key enterprises.At the same time, the State Economic and Trade Commission announced that in the next few years, it will focus on supporting six companies including Baosteel, Haier, Jiangnan Shipbuilding, North China Pharmaceutical, Peking University Founder, and Changhong, and strive to make them enter the "World Top 500" by 2010.After the central government determined the "national team", all provinces responded and issued their own support lists one after another, announcing that they would be included in the "Top 500 Enterprises in China" within a few years, and cities around the world proposed accordingly. The idea of ​​building a "top 100 provincial-level enterprises" was realized.

The so-called small and medium-sized state-owned enterprises in non-pillar industries with poor business performance are sold to the private sector under the pretext of "shutdown and transfer". If no one wants them, they will go bankrupt.This move caused great controversy in the ideological field at the time. Conservatives regarded it as "the loss of state-owned assets." However, in 1998, the strategy of "grasping the big and letting go of the small" came to an abrupt end.During the Asian financial crisis, many conglomerates in Japan and South Korea that pursued a mixed business model fell into trouble one after another, especially the bankruptcy of South Korea's Daewoo Group, which once ranked 28th in the world's top 500, which greatly stimulated China's economic circles.Since then, the strategy of "grasping big" has quietly shifted, and state-owned capital has gradually withdrawn from competitive fields such as textiles, home appliances, and food, and has instead formed a dominant and monopoly position in so-called strategic sectors such as resources, energy, and heavy chemicals. The state-owned assets in the field have undergone a large-scale restructuring.Back then, this strategy was called "retreating from the state and advancing from the people." The so-called "retreat" did not refer to the withdrawal of the state-owned economy from the industrial field, but to the retreat to the upper reaches of the industry to form the advantages of oligarchs or multi-oligarchs.

The "National Retirement and Democratic Advancement" movement began to be tested in 1997, promoted on a large scale in 1998, and came to an end in 2003. It means the quiet end of the 20-year state-owned enterprise reform movement with the theme of mechanism transformation and decentralization and invigoration. The ownership structure of the company has been changed. In 2002, a "Investigation Report on Private Enterprises in China" showed that in the past four years, 25.7% of the surveyed private enterprises were "restructured" from state-owned enterprises and collective enterprises. The region has the largest proportion, 45.6%, that is to say, nearly half of the private enterprises in the east are restructured from state-owned enterprises.

An astonishing fact is that, as the most important strategic adjustment in the reform of state-owned enterprises, the "retirement of the country and the advancement of the people" has never formed a national and legalized reform plan. This is the most bizarre part of this reform. The idea of ​​"crossing the river by feeling the stones", the Eight Immortals crossing the sea, each showing their magical powers, there have been dozens of methods for quantifying the transfer of property rights.State-owned enterprise operators, local governments, and banks work hand in hand, taking state-owned assets as their own, while tens of millions of industrial workers are bought out by "service length" (generally, one year of service is converted to 800 to 2,000 yuan, the southern low, high in the north) were forced to leave their jobs.

There is a detail that should be recorded: the official statistics at that time showed that the total number of laid-off workers in the country was about 15 million, which became a very terrible "social bomb".Around 1998, the World Bank and the Research Group of the State Council's Restructuring Office separately estimated the amount of social security arrears, and a relatively close number was 2 trillion yuan.Some economists and officials suggested that nearly 2 trillion yuan of state-owned assets should be allocated to "solidify" the social security personal accounts of older workers to compensate these laid-off workers for the price they paid for the reform. At the beginning of 2000, the State Restructuring Office drew up relevant plans, but they were ultimately rejected by the State Council on the grounds that “the transformation of state-owned assets into employees’ private assets is clearly a loss of state-owned assets.”In his later years, when Wu Jinglian commented on this past event, he used eight words: "It must be impossible, and it must not be done."

The sudden riches of the executives and the abandonment of tens of millions of industrial workers in the property rights clarification movement once again showed the cruel side of China's economic transformation: unbalanced development has resulted in unbalanced wealth distribution, and in the process of economic recovery and material wealth growth Among them, grassroots farmers and industrial workers paid the greatest price.