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    The struggle against corruption and waste is a major issue which concerns the whole Party, and we have told you to give it your serious attention. We need to have a good clean-up in the whole Party, which will thoroughly uncover all cases of corruption, whether major, medium or minor, and aim the main blows at the most corrupt, while following the policy of educating and remoulding the medium and minor embezzlers so that they will not relapse. Only thus can we check the grave danger of many Party members being corroded by the bourgeoisie, put an end to a situation already foreseen at the Second Plenary Session of the Seventh Central Committee and carry out the principle of combating corrosion then laid down. Be sure to give all this your attention.

(November 30, 1951)  

    Particular attention must be paid to the fact that the corrosion of cadres by the bourgeoisie results in serious cases of corruption. Be sure to detect, expose and punish those involved and to take this as a major struggle.

(November 30, 1951)  

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    The struggle against corruption, waste and bureaucracy should be stressed as much as the struggle to suppress counter-revolutionaries. As in the latter, the broad masses, including the democratic parties and also people in all walks of life, should be mobilized, the present struggle should be given wide publicity, the leading cadres should take personal charge and pitch in, and people should be called on to make a clean breast of their own wrongdoing and to report on the guilt of others. In minor cases the guilty should be criticized and educated; in major ones the guilty should be dismissed from office, punished, or sentenced to prison terms (to be reformed through labour), and the worst among them should be shot. The problem can only be solved in these ways.

(December 8, 1951)  

    In all cities, and first of all in the big and medium-sized cities, we should rely on the working class and unite with the law-abiding capitalists and other sections of the urban population to wage a large-scale, resolute and thoroughgoing struggle against those capitalists who are violating the law by bribery, tax evasion, theft of state property, cheating on government contracts and stealing economic information; we should co-ordinate this struggle with that against corruption, waste and bureaucracy, which is being waged inside the Party, government, army and mass organizations. This is both imperative and very timely. In the struggle, Party organizations in all cities must carefully dispose the forces of the classes and masses and adopt the tactics of utilizing contradictions, effecting splits, uniting with the many and isolating the few so that in the process a united front against the "five evils" will speedily take shape. In a big city, as the struggle against the "five evils" gets into full swing, such a united front may well come into being within about three weeks. Once this united front is formed, those reactionary capitalists guilty of the worst crimes will be isolated, and the state will be in a strong position to mete out due punishment, such as fines, confiscation, arrest, imprisonment or

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execution, without much opposition. All our big cities (including provincial capitals) should start the struggle against the "five evils" in the first ten days of February. Please make prompt arrangements.

(January 26, 1952)  

    (1) In the movement against the "five evils" the basic principles in dealing with industrial and commercial units are: leniency for past offences and severity for new ones (for instance, payment of taxes that have been evaded is generally retroactive only to 1951); leniency towards the many and severity towards the few; leniency towards those owning up to their crimes and severity towards those refusing to do so; leniency for industry and severity for commerce; and leniency for commerce in general and severity for commercial speculation. The Party committees at all levels are asked to adhere to these principles in the movement against the "five evils".

    (2)  For the purpose of the movement against the "five evils" private industrial and commercial units should be classified into five categories: the law-abiding, the basically law-abiding, those that partly abide by the law and partly break it, those that break the law on a serious scale, and those that completely violate the law. As far as the big cities are concerned, the first three categories make up about 95 per cent and the last two about 5 per cent. The percentages for different big cities are roughly the same, with only small variations. As for medium-sized cities, the percentages differ considerably from these figures.

    (3)  These five categories apply to the capitalists and the non-capitalist independent handicraftsmen and family traders, but not to the street vendors. In big cities the street vendors may be left alone for the time being, but the independent handicraftsmen and family traders had better be dealt with. In medium-sized cities it would be better to deal with both the independent handicraftsmen and traders and the street vendors in this movement. In our big and medium-sized cities there are large numbers of independent handicraftsmen and traders who do not employ workers or shop assistants (though some have apprentices). Many of them are law-abiding, many others basically abide by the law but partly break it (i.e., they have minor offences to account for, such as small-scale evasion of taxes), and a small number partly abide by the law and partly break it and have evaded taxes on a larger scale. In the current movement against the "five evils" we must deal with a considerable number of small capitalists and pass judgment on them, and as far as possible do likewise with the independent handicraftsmen and traders, who roughly equal the small capitalists in number. This will be to the advantage of the current movement and to economic construction in the days ahead. The small capitalists as well as the independent handicraftsmen and traders are generally innocent of serious offences, and it is not difficult to pass judgment on them. In so acting, we shall win support from the masses. However, if a few cities think it convenient to pass judgment first on industrial and commercial units other than the independent handicraftsmen and traders and defer judgment on the latter, that is in order, too.

    (4)  In view of the actual situation in the cities we have decided to reclassify industrial and commercial units into five categories instead of four as in the past, i.e., those in the law-abiding category are to be reclassified into law-abiding and basically law-abiding, while the other three categories remain unchanged. Out of the fifty thousand industrial and commercial units in Peking (including the independent handicraftsmen and traders, but not the street vendors), the law-abiding ones make up about 10 per cent, the basically law-abiding ones about 60 per cent, those that partly abide by the law and partly break it about 25 per cent, those that break the law on a serious scale about 4 per cent and those that completely violate the law about 1 per cent. To distinguish between the strictly law-abiding ones and the basically law-abiding ones with minor offences and, furthermore, to treat the basically law-abiding units guilty of small-scale tax evasion differently from those guilty on a larger scale may prove to have important educational value.

    (5)  In some big and medium-sized cities, the city Party committees launched the movement against the "five evils" in a hurry, when they were not at all acquainted with the situation with respect to the different categories of industrial and commercial units and were not clear about the tactics of differential treatment, and when the work teams (or investigation groups) sent by the trade unions and the government had been organized and trained in a very slipshod way. As a result some confusion has arisen. It is hoped that the city Party committees concerned will pay attention to this situation and see to its correction without delay.

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Moreover, the investigation of industrial and commercial units which break the law must be made under the strict control of the city Party committee and the city government. No other organization is allowed to send out people to investigate on its own, much less to haul capitalists into its office for interrogation. Whether in the movement against the "three evils" or in that against the "five evils", the use of torture to extort confessions is forbidden and strict precautions must be taken to prevent suicides. Where suicides have occurred, measures for preventing their further occurrence should be worked out immediately to ensure that both movements will develop soundly and on the right track and that complete victory will be won.

    (6)  The movements against the "three evils" and against the "five evils" are not to be launched at present in counties, districts and townships. Further notice will be given by the Central Committee as to when and how to carry them out. In the few instances where the movement against the "five evils" has been launched at county seats and that against the "three evils" in districts, in both cases experimentally, strict control must be exercised and spring farming and other economic activities must not be hampered. The movement against the "five evils" should not begin in all the medium-sized cities at the same time but should be staggered and strictly controlled.

(March 5, 1952)  

    During and also after the struggle against the "five evils", we must achieve the following aims:

    (1)  Get thoroughly clear about the situation in private industry and commerce so as the better to unite with and control the bourgeoisie and develop the country's planned economy. Planned economy is impossible unless we are clear about the situation.

    (2)  Draw a clear line of distinction between the working class and the bourgeoisie, and in trade unions eliminate corruption and bureaucracy which alienates the masses and weed out the capitalists' hirelings. Such hirelings and the middle elements vacillating between labour and capital are to be found in trade unions everywhere, and in the struggle we must educate and win over the middle elements, whereas those hirelings guilty of serious crimes should be expelled.

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    (3)  Reorganize the trade councils and associations of industry and commerce, remove from their leading bodies persons guilty of all the "five evils" and those who have been totally discredited, and in their stead draw in those who have acquitted themselves fairly well in the struggle against these evils. With the exception of those who have completely violated the law, there should be representation of all categories of industrialists and traders.

    (4)  Help leaders of the China Democratic National Construction Association to conduct a shake-up, to expel those guilty of all the "five evils" and those who have disgraced themselves in the public eye and to recruit a number of better individuals, so that it can become a political organization capable of representing the legitimate interests of the bourgeoisie, mainly the industrial bourgeoisie, and of educating them in the spirit of the Common Programme and in the principles governing the struggle against the "five evils". Take measures to disband the secret organizations of different groups of capitalists, such as the "Thursday Dinner Club".[2]

    (5)  Eradicate the "five evils" and eliminate commercial speculation so that the entire bourgeoisie will obey the laws and decrees of the state and engage in industrial and commercial activities beneficial to the nation's economy and the people's livelihood. Develop private industry within the limits set by the state (provided the capitalists so wish and its operations conform with the Common Programme), and reduce private commerce step by step. Expand the state's plan to monopolize the sales and contracts of private industry year by year and at the same time extend the coverage of our plan over private industry and commerce. Set new percentages of profit for private capital so that it will be able to make some profits but not exorbitant ones.

    (6)  Do away with hidden accounts, make the accounts public and gradually establish a system under which the workers and shop assistants supervise production and management.

    (7)  Recover the greater part of the economic losses to the state and the people through the payment of evaded taxes, restitution, fines and confiscation.

    (8)  Set up Party branches among workers and shop assistants in all large and medium-sized private enterprises and strengthen Party work.

(March 23, 1952)  

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  ^[1] The movement against the "three evils" was the struggle against corruption, waste and bureaucracy launched at the end of 1951 among the personnel of government departments and state enterprises. The movement against the "five evils" was the struggle against bribery, tax evasion, theft of state property, cheating on government contracts and stealing of economic information started at the beginning of 1952 among owners of private industrial and commercial enterprises.    [p. 64]

  ^[2] The "Thursday Dinner Club" was a secret organization of some capitalists in Chungking, which engaged in surreptitious activities in grave violation of the law. It was exposed and banned in the movement against the "five evils".    [p. 69]