18

Industry

Ever greater output targets were assigned to factories, foundries, workshops, mines and power plants all over China. How a production unit was rewarded was determined by the percentage of the quota it managed to fulfil. The output total was the magic number that determined the rise and fall of any one factory. And just as cadres in the people’s communes pledged ever increasing amounts of grain, all over the country factories tried to outperform each other in fulfilling the plan. Lists of output figures were broadcast on a daily basis by the propaganda machine, reproduced on chalkboard messages and wall newspapers for everybody to see. Charts and diagrams with growth projections were displayed in factory shops. Photos of model workers were enshrined under glass on a ‘board of honour’, while posters, stars, ribbons and slogans adorned the walls of every workshop. Underachievers were identified at factory meetings, while workers who overfulfilled the targets were commended, some of them attending mass meetings in Beijing reviewed by the Chairman himself. Above the hissing molten metal, the clang of crucibles and the whistling steam an incessant racket would come from loudspeakers, spewing out propaganda and radio programmes to encourage workers to increase production.¹

As the supreme goal of the red factory was output, the cost of input was often neglected. In the sprawling bureaucracy in charge of industry, from the central economic ministries to the different administrative departments within the factories, nobody quite managed to keep track of the staggering amount of equipment ordered from abroad. Even Zhou Enlai, who so ruthlessly pressed for the extraction of foodstuffs from the countryside to meet export targets, seemed unable to curb the import of machinery effectively. Enterprises also borrowed money to fund constant expansion, build prestige buildings and purchase more equipment. In the case of the Luoyang Mining Machinery Factory, the monthly interest owed to the bank was equal to the factory’s entire wage package.²

But, once installed, the new equipment was subjected to poor maintenance and relentless maltreatment. On a visit to a wharf in Shanghai in 1961, the otherwise sympathetic delegation from East Germany were taken aback by the state in which they found imported machinery. New materials like sheet metal, tubes and profile iron rusted in the open.³ The Iron and Steel Plant in Wuhan, inaugurated with much fanfare by Mao at the height of the Great Leap Forward in September 1958, gave a similar impression of extreme neglect, a mere two out of six Siemens-Martin furnaces operating at full capacity by 1962.⁴ More detailed reports by investigation teams confirmed that materials, tools and machinery were neglected or even deliberately damaged. In the Shijiazhuang Iron and Steel Company, for instance, half of all engines broke down frequently.⁵ A culture of waste developed. In Luoyang, three factories alone had accumulated more than 2,500 tonnes of scrap metal that went nowhere.⁶ In Shenyang, sloppy streamlets of molten copper and nickel solutions ran between heaps of scrap metal.⁷

Waste developed not only because raw resources and supplies were poorly allocated, but because factory bosses deliberately bent the rules to increase output. The brand-new iron and steel plant in Jinan, according to a team of auditors, wasted a fifth of total state investment, or 12.4 million yuan, in its first two years by adding sand to hundreds of tonnes of manganese ore, resulting in a useless mixture which had to be discarded.⁸

As everyone worked feverishly towards higher production levels, mountains of substandard goods accumulated. Many a factory spewed out inferior goods as corners were cut in the relentless pursuit of higher output. The very fabric of material culture was shot through with shoddy goods, from ramshackle housing, rickety buses, wobbly furniture and faulty electric wiring to flimsy windows. The State Planning Commission found that a mere fifth of all the steel produced in Beijing was first rate. Most was second or third rate, and over 20 per cent was classified as defective. In Henan more than half of all the steel produced in factories was third rate or worse. Inferior material churned out by the steel-producing giants had a knock-on effect for a whole range of related industries. At Angang, the sprawling steel and iron complex in Anshan, the rails produced in 1957 were generally of first-rate quality, but by 1960 a mere third corresponded to the requisite standards. As the quality of the rails suffered, several sections of the railway network became too dangerous for heavy traffic and had to be closed down; a few collapsed altogether.⁹

Not only did the quantity of inferior goods increase, but larger proportions of them found their way into society. In Henan only 0.25 per cent of the cement which did not fulfil production criteria actually left the premises in 1957. This ballooned to over 5 per cent in 1960, as large quantities of substandard material were used on building sites. A survey of a whole series of industries in Kaifeng, Henan, reached an even more astounding conclusion: more than 70 per cent of all the output consisted of reject products.¹⁰

And just as faulty rails, warped beams and fake cement perilously weakened the material structure of everyday life, inferior consumer goods became part and parcel of socialist culture. In Shanghai clocks sounded the alarm at random, enamel basins were sold with splits and bubbles on the surface, while half of all knitwear and cotton goods were defective.¹¹ In Wuhan zips jammed, knives bent and blades broke off the handles of agricultural tools.¹² Sometimes factories cut costs by churning out products without any identifying label. This was the case with a fifth of the tinned meat sold in Beijing. Sometimes the labels were wrong, for instance when fruit was substituted for pork, leading to large amounts of rotten goods.¹³ Even more worrying were problems caused by the addition of chemicals to processed food. In one year a Beijing dye factory sold 120 tonnes of harmful pigments specifically designed as food additives. Many of these were banned, for instance Sudan yellow, a dye used in inks. Lax procedures over quality control also meant that contaminated food and medicine were allowed to leave the factory floor, one example being a batch of 78 million bottles of penicillin gone bad. A third was sent out from a Shanghai factory before the problem was even spotted.¹⁴ Mao scoffed at the very notion of a defective product: ‘there is no such thing as a reject product, one man’s reject is another man’s grain’.¹⁵

Mao may have dismissed concerns about quality, but a reject culture damaged the country’s reputation on the international market. As we have seen, the cost of making good on the leaky batteries, contaminated eggs, infected meat, fake coal and other tainted merchandise delivered in 1959 alone amounted to 200 or 300 million yuan. But reject culture also corrupted the inner workings of military industry. As a report by Marshal He Long showed, it was not only assault rifles that failed to fire, but also nineteen jet fighters produced in Shenyang that were substandard. In Factory 908 well over 100,000 gas masks were unusable. Nie Rongzhen, who ran the nuclear weapons programme, in turn complained about the poor quality of wireless devices and measuring gauges, which were often unreliable because of dust particles trapped inside. Even in top-secret factories rubbish was found everywhere, and the slightest breeze blew the dirt resting on propaganda banners hanging on the wall on to sensitive equipment: ‘The Americans doubt that we can make guided missiles because the Chinese are too dirty.’¹⁶

Living conditions for workers were appalling. Stupendous imports of foreign machinery were meant to catapult the country forward, as gleaming new plants, from steel mills and cement kilns to oil refineries, were purchased from the Soviet Union and Eastern Europe. But very little was invested in the housing and feeding of ordinary workers and their families – despite the fact that the workforce exploded with the arrival of millions from the countryside.

Take the iron and steel plant in Jinan, the capital of Shandong. Established at the height of the Great Leap Forward in 1958 with the most technologically advanced equipment, it should have been a haven for its new recruits. But conditions deteriorated rapidly. There were inadequate toilet facilities, so workers urinated and defecated directly on the factory floor. Filth and stench permeated the premises, lice and scabies were common. Chaos reigned on the ground. Scuffles were a frequent occurrence, windows were broken and doors smashed in. A pecking order emerged in which the strongest workers grabbed the best beds in the dormitories. Fear was pervasive, in particular among women, who were commonly teased, humiliated and abused by local cadres in their offices, in their dormitories or sometimes on the factory floor in full view of other workers. None of them dared to sleep or go out on their own.¹⁷

A similar scene could be found in Nanjing. When the Federation of Trade Unions looked into the lives of iron, steel and coal workers in 1960, they found filthy canteens infected with insects and rodents. Queues were interminable, up to a thousand workers lining up in front of a single canteen window at the Lingshan Coal Mine. As the canteen was open for only an hour, workers would tussle and wrangle for space, sometimes coming to blows. In the Guantang Coal Mine, miners who were late were deprived of their meal, and had to go down the shafts for a ten-hour shift on an empty stomach. Dormitories were cramped. On average each worker had a space of 1 to 1.5 square metres, although some slept on boards jammed between beds or against the pillars. Many rested in shifts, having to share a bed. Straw roofs would leak, forcing some of the workers to move their bunk beds around the dripping pools. Others slept under an umbrella. Protective equipment was either lacking or wholly inadequate. Many miners had no shoes and had no alternative but to go down the shafts barefoot. Those made to hew coal in open pits were drenched when it rained, their jackets soaked with water. In the dormitories there were no blankets, and the humidity was so high that clothes would never quite dry. Some of the steel workers who had to work in front of blast furnaces burned their feet because they had no shoes.¹⁸

Further south, in subtropical Guangzhou, the dormitories were so crowded that a bunk bed provided no more than half a square metre per worker. Shoddy construction work meant that the premises were hot and damp during the rainy season, causing mould to spread like a rash, infecting clothes and bedding. The humidity was such that some of the facilities were described as mere ‘ponds’, with water dripping from the walls to form puddles on the floor.¹⁹ In the Quren coal mine, located near Shaoguan, workers cannibalised the pit props and mine timber to build furniture or provide heating. One in seven workers suffered from silicosis, also known as potter’s rot, caused by inhalation of dust particles, as no protective masks were provided.²⁰

The situation was no better in the north. In the capital itself, a detailed study of four factories by the Federation of Trade Unions showed that there were four times as many workers as before the Great Leap Forward, although dormitory space had failed to keep pace with the increase. In Changxindian, in the Fengtai district, a railway factory allocated just over half a square metre to each of its workers. Throughout Beijing, workers slept in storage rooms, libraries and even in air shelters, often on bunk beds arranged in three layers. They were packed like sardines, so tightly that there was no room to turn at night. In order to get through a door, workers had to queue up. The toilets were permanently engaged and more often than not blocked. Many would wrap their faeces in a sheet of newspaper and chuck the package through a window.

Few factories provided sufficient heating: one of the four enterprises inspected had none in the bitterly cold winter of 1958–9. Workers would resort to burning coal balls in small stoves, which resulted in several deaths from coal-gas poisoning. Influenza was common. Rubbish accumulated everywhere; theft was widespread. Bullying was rife, in particular in the case of new arrivals. In the Liulihe Cement Plant, separately inspected by the Federation of Trade Unions in March 1959, three canteens designed for a total of a thousand people had to provide for over 5,700 workers. Older workers were simply pushed aside by young men eager to jump the queue, many never eating anything but cold food.²¹ A year later a similar investigation noted few changes, adding that ‘hooliganism’ – a criminal offence taken from the Soviet penal code and covering a wide range of acts such as foul language, destruction of property and illegal sexual behaviour – was common in dormitories. Workers used power and influence to upgrade from one bed to another, finding space for friends and family despite overcrowding.²²

By 1961 up to half of the workforce in Beijing suffered from famine oedema.²³ Industrial diseases were common, some 40,000 workers having been exposed to silicon dust. A report written by the city’s People’s Congress estimated that one in ten workers suffered from a chronic disease.²⁴ The real situation was probably much worse.

Many new factories opened during the Great Leap Forward were described as ‘run by the people’ rather than ‘run by the state’. They fared no better. Most were jerry-built affairs, quickly set up in buildings confiscated from the public and often inadequate for industrial production. One chemical workshop in Nanjing, put together in a residential dwelling, had a bamboo roof and paint peeling from mud walls. It employed some 275 workers. Radioactive waste permeated nooks and crannies, accumulated on the floor of the common room or lay in open vats, from where it was spread by wind and rain. Workers suffered from throat and nose irritations, as the protective equipment they were meant to wear was not used properly. The masks and gloves were often turned inside out, and were carried to the dormitories without thorough cleansing. Of the seventy-seven female workers medically inspected, eight were pregnant or breast feeding, although they were in contact with radioactive material for several hours daily. No showers were taken in the winter.²⁵

This was not an isolated example. In the twenty-eight factories ‘run by the people’ in the Gulou district, the old centre of town where drums used to mark the night watches, rubbish was found everywhere. Ventilation was non-existent in the smaller concerns. Many of the workers were women who had joined during the Great Leap Forward. Most had no work experience and were given very little protective equipment, some only donning straw hats. Exposure to chemical components and silicon dust commonly caused red eyes, headaches, itches and rashes. Some of the women had the cartilage separating their nostrils eaten away by constant inhalation of chemicals. Heatstroke, with temperatures near the furnaces ranging from 38 to 46 degrees Celsius even in the middle of the winter, was a frequent occurrence.²⁶ In a health check carried out on 450 women working in a factory producing electron tubes in Nanjing, more than a third suffered from lack of menstrual periods, a symptom of malnutrition. In the Nanjing Chemical Plant a quarter had tuberculosis, while one in two suffered from low blood pressure. Half had worms.²⁷

However abysmal their living conditions, workers were better off than the farmers who produced the food they ate. But few could afford to support their families or remit money to the village many had left behind. Their salaries were eroded by inflation and depleted by food purchases, necessary to complement the meagre rations they were given in the canteen. In the Shijiazhuang Iron and Steel Company, workers spent three-quarters of their salaries on food.²⁸ In Nanjing many workers had to borrow money, incurring debts ranging from 30 to 200 yuan. Given the paltry salaries that most workers earned, these were crippling liabilities. A Grade Three worker made 43 yuan a month, although the food alone for a family of five cost 46 yuan. No savings were made in the canteen, where the fare was often poor and expensive.²⁹ But few people ever managed to rise to a Grade Three. The majority of salaries ranged from 12.7 to 22 yuan a month.³⁰ In the more deprived factories ‘run by the people’ over a third of the workforce were paid less than 10 yuan a month. Many had to borrow money or pawn the few personal items they had left, selling spare clothing during the summer only to shiver through the winter.³¹

And then came the medical fees, for which workers often had to pay. A close look at one chemical plant in Beijing in 1960 showed that hundreds of workers were in debt as a result of medical treatment. Chong Qingtian looked after his sick wife but owed some 1,700 yuan by the time she died. He was taken to court and was required to pay 20 yuan each month, leaving him with just over 40 yuan to live on. He was an excellent worker, but many were in a less enviable position, ending up being ruined by the medical fees incurred to treat illnesses caused by appalling working conditions.³²

When all the problems inherent in the planned economy were taken into account – uncontrolled capital spending, enormous wastage, defective products, transportation bottlenecks, woeful labour discipline – the performance of most factories was dismal. The actual costs were difficult to calculate in the financial morass created by central planning. Not only did accountants cook the books, but sometimes they did not even know how to handle the sums. In Nanjing some forty large production units had a total of only fourteen accountants, of whom a mere six were able to keep track of the money. Many factories did not even maintain a log for outgoings and incomings, and nobody had the faintest idea of the costs incurred.³³

But some approximations indicate the extent of the damage, as the example of steel, which is basically iron reinforced with carbon and hardening metals, shows. In Hunan 2.2 tonnes of iron were used to produce a tonne of steel, meaning enormous waste. The cost of making a tonne of steel was 1,226 yuan, which had to be sold at a state-mandated price of 250 yuan – or a loss of about 1,000 yuan per tonne. In 1959 the province lost about 4 million yuan each month on steel.³⁴ Better prepared to make steel in a cost-effective way were the technologically advanced mills and furnaces of Shijiazhuang. Founded in 1957, Shijiazhuang Iron and Steel made a profit before the Great Leap Forward, but soaring costs soon sent it plunging into the red. In 1958 a tonne of steel cost 112 yuan, turning a profit for the plant of some 16 million yuan. In 1959 the cost per tonne went up to 154 yuan, pushing the plant into a deficit of 23 million yuan, followed in 1960 by costs of 172 yuan per tonne and losses in excess of 40 million yuan. By that time the plant relied on a variety of poor iron ores coming from mines as far away as Hainan Island.³⁵

As the losses started piling up, output collapsed. After several years of breakneck growth, the economy moved into a deep slump in 1961. The supply of coal – the fuel of modern industry – dried up. In the coal mines the equipment had been so badly treated during the Great Leap Forward that most of it was defective. New machinery often did not last longer than six months on account of the low-grade brittle steel used in its production. The miners themselves were leaving in droves, disgusted at the soaring cost of food and housing, fed up with the shortages of such basic items as soap, uniforms and rubber shoes.³⁶ And even if the coal was hauled out of the mines, fuel shortages consigned much of it to pile up unused. The four big coal mines in Guangdong province produced some 1.7 million tonnes of coal in 1959 but managed to transport less than a million.³⁷ In Gansu the radical leadership of Zhang Zhongliang made sure that coal production soared from 1.5 million tonnes in 1958 to 7.3 million tonnes in 1960, at considerable human cost, but after the petrol ran out some 2 million tonnes were abandoned in the mines.³⁸

As coal production plummeted, factories around the country came to a standstill. In Shanghai in December 1960 the China Machinery Plant worked at a third of its capacity because of a lack of electricity. The Number One Cotton Mill had 2,000 workers idle all day long.³⁹ In the first half of 1961 the mandated amount of coal delivered to Shanghai was decreased by 15 per cent, but a third of that reduced amount was never actually delivered. Close to half of all the iron and timber needed to feed the city’s heavy industry was missing as well.⁴⁰

Because it was an industrial centre of strategic importance, Shanghai was given the highest priority by the planners. The situation was worse elsewhere, as the shortcomings of the economy spiralled out of control. In Shaoguan, the heavy-industry city of Guangdong, a survey of thirty-two state enterprises in the summer of 1961 showed that production had nosedived, with soap down by 52 per cent on the previous year, bricks by 53 per cent, pig iron by 80 per cent, matches by 36 per cent, leather shoes by 65 per cent. In the shoe factory each worker produced one pair a day where three had been made before the Great Leap Forward.⁴¹ Table 9 shows what happened in the whole of Hunan province. These figures refer only to output, which more than doubled from 1957 to 1960, only to be halved again in the following two years. Had the cost of this obsession with quantity over quality been calculated, it would have pointed to a disaster of gargantuan proportions, inversely commensurate with the ambitions of the master plan. But no factories went bankrupt: that was a capitalist phenomenon associated with the boom-and-bust cycles that the planned economy was designed to avoid.