The Early Tiny Steps Toward Capitalism

I’ve started doing some research into China, and specifically Guangzhou, in the early to mid 1980s. It’s a particularly interesting time period for me in part because it comprises half of the 10 years I spent in China. Of course, it also happened to be the first years of my life, so even though I lived in Guangzhou then, I really don’t have a strong recollection of those days, much less an awareness of the socio-economic changes that were under way. And there were plenty of changes happening then. It was the beginning of reforms in economic policy and China’s opening up to the world. Guangzhou, having been designated one of the first special economic zones, was on the forefront of the changes that would eventually lead to China’s rapid ascension.

As part of my research, I’ve stumbled across a very interesting book. Its title, roughly translated, is “Recollections by Pioneers of Guangzhou’s Economic Reforms and Opening Up”. The book is a series of interviews with various people from all walks of life who were part of that first wave of changes spurred by the new economic policies in Guangzhou. I think I’ll translate excerpts from some of the interviews and share them here, since they offer an interesting glimpse into how those nationwide changes in government and society were affecting the daily lives of individuals, which is the angle I’m trying to take with my book. The excerpts also shed some light on people’s mentalities at that time.

I’ll start with excerpts from an interview with Yong Zhiren, a man who opened a small eatery in Guangzhou in 1979 — the year I was born. Yong is a member of a large group known as “zhi qing” (知青), or literally “knowledgeable youths”. While the term in a general sense describes young people who have received high levels of education, it also specifically refers to students who, in the period from the 1950s through the 1970s, left the cities and settled in the countryside, either voluntarily or forced to do so by government policies. The irony is that the majority of people in this group actually only received middle- or high-school educations because of their often involuntary relocations. It’s also a group to which most members of my parents’ generation belong.

In March 1979 I left the countryside and returned to the city, going from a valley in Yanghong back to within the Guangzhou city limits. In order to make a living, many among us “zhi qings” began looking for our own work. I, too, went to the neighborhood living services bureau to submit a request to start a business and later received a business license. My original intent was to do something related to art, since painting and calligraphy were my interests and strengths. I wanted to use my specialty to earn money. However, the district I lived in, Xihua, was neither a cultural nor a commercial district, so my neighborhood committee suggested I open an eatery serving breakfast. This small district had many factory workers and students who needed a hearty breakfast, but there was only one breakfast shop, in a nearby restaurant, and every morning there were long lines at that shop. So I decided to open a breakfast eatery.

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In the beginning I didn’t know how to make breakfast items, so my kind neighbors patiently taught me how to cook congee and make rice noodles. My menu and prices were: Rice noodles without beef tendons, 1 mao (1/10th of one Chinese yuan, or about 1.5 cents) per plate; rice noodle with beef tendon, 2.5 maos per plate; congee, 1 mao per bowl. Because the food was good and the prices low, business was booming from the first day, and the noodle and congee quickly sold out. However, because I didn’t make enough food the first day, I only made 3.7 yuan. The next day we managed things just right and quickly made more than a dozen yuan. At that time, the average monthly salary was only a few dozen yuan, so I felt there was a future in the restaurant business. Firstly, it would improve my life, and secondly it leaves me plenty of time to create art. I’m an educated man, so it would be a very productive and stimulating life to run a restaurant in the morning and then compose Cantonese operas and write essays in the afternoon.

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My eatery kept doing better and better, and I faced the problem of not having enough help, since I had to not only make the noodles and cook the congee, but also bus tables and disinfect utensils. The mentality of those times was only slightly liberated, not yet completely liberated, so you couldn’t hire more than seven employees. It’s because Marx said hiring seven or fewer employees doesn’t count as exploiting the value of others’ labor, but rather still qualifies as socialism. Therefore in the beginning I was afraid to hire anyone. Fortunately the students who ate at my shop voluntarily came in small groups to help me bus tables. They said, “Uncle Yong, we’ll help you.” Every morning there were eight of them there to help. I tried to give them free breakfast, but they refused and insisted on paying. 

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When I first started operating, I ran into the problem of not having enough coal. At that time we were depending on coal obtained through coal stamps from the government, but that was only enough for personal use, not for a business. Our earliest solution was to barter: Customers could trade one coal stamp for one plate of rice noodle with beef tendons and a bowl of congee. Some families that didn’t cook breakfast themselves tended to have spare coal stamps, and they were willing to trade them for our food.

It went on like this for two years, then on August 28, 1981, the provincial secretary met with twelve young people from the province who had started their own businesses, and I was one of them. … I recounted my experience to him. … The secretary was very happy when he was done listening. He smacked the table, stood up, and said, “Great! Yong Zhiren, you are doing a great thing!” He told me that it’s terrific that young people have the courage to start their own businesses, and that the party and the government want to help us get started. He felt that our private businesses weren’t capitalist, but instead socialist. … He even asked us what problems we encountered in our businesses. I told him about the coal shortage. The secretary had people from many departments there at the time, and he told each department to take care of us. From then on the government gave me a lot of help. My coal problem soon fell to the Yuexiu district office, and that department appropriated four tons of coal to me at once. The government even sent the coal in separate shipments out of consideration that my house was small and couldn’t hold all that coal at once.

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There was a derogatory name in Guangdong for private businesses — “small-time peddlers”. “Small-time peddlers” were not a respected group. At that time the common view around the whole country was that only working in a company was respectable, and that running a personal business was not honorable. In the beginning I also felt that way, since educated people have the pride that comes from possessing artistic skills. Later, my thinking gradually changed, and I felt that the career I pursued was an honorable one.