Chapter 75 Growing opium on a large scale, expanding power 1942-1944

Journalist: “I heard that even Yan’an was involved in opium cultivation. Is it true?”

Mao: “It is true. Yan’an, known as the revolutionary ‘holy land,’ claimed to be self-reliant and self-sufficient, but it also relied on opium cultivation to expand its influence. In the article ‘Special Commodity Trade during the Yan’an Period,’ written by veteran cadre Hong Zhenkuai and published in ‘Yan Huang Chunqiu’ magazine, it was revealed that in the 1940s, the Communist 359th Brigade in Nan Ni Wan was ordered to cultivate a large amount of opium, producing 5-6 tons annually, which was sold to the public to make money, harming the people.”

Journalist: “Yan’an had two sources of economic assistance. First was the relief provided by the Kuomintang government in the initial years, and second was the secret aid from Moscow. In February 1940, Stalin stipulated a monthly assistance of 300,000 US dollars, which is equivalent to 50 million US dollars annually today.

The local income came from agricultural taxes known as ‘national salvation grain.’

The figures for national grain production increased sharply: 1937: 13,859 shi of grain (1shi:6.35kg), 1938: 15,972, 1939: 52,250, 1940: 97,354, 1941: 200,000

The dramatic increase in national grain production was due to the massive expansion of the military, which required funds and grain. Grain requisitioning was enforced through coercion and violence. Xie Juezhai, the Secretary-General of the Shan Gan Ning Border Region Government, remarked that forced grain requisitioning caused people’s deaths. In 1940 and 1941, the national grain production doubled and then doubled again. There were widespread complaints from the local people, and I was aware of it. One day during a thunderstorm, a county magistrate was struck dead by lightning, and a peasant said, ‘Why didn’t the heavens strike Mao Zedong dead?’

Journalist: “The old peasants truly hated you?”

Mao: “Yes, I understood the resentment of the peasants, but we had no choice but to impose taxes. The thunderstorm incident and the curse from the peasants occurred on June 3, 1941. And four months later, on October 15, we announced an unprecedented high level of national grain requisition. We also introduced a new tax, the public grass tax, which was levied as horse fodder.

In another instance, a man pretending to be insane rushed at me and attacked. He was angry with me because of the heavy burden of national grain requisition. One peasant even bought a portrait of mine and gouged out the eyes, but when he was arrested and interrogated, he said, ‘Chairman Mao lacks eyesight.’ The actual figures for national grain requisition were no longer made public after that.”

Journalist: “Wow, the peasants wanted to attack you and gouge out your eyes?”

Mao: “Yes, it is true. We propagated that the tax burden in the Shaan-Gan-Ning Border Region was much lower than in Kuomintang-controlled areas. However, Xie Juezhai admitted that some peasants “had nothing to eat after paying the national grain requisition. The amount of national grain requisition was almost equivalent to their annual grain income, and some people couldn’t even produce enough grain to meet the requisition.

In 1941, the Border Region government started salt production. Salt became the second-largest source of local income. In the exports from the Kuomintang-controlled areas, salt accounted for 90%. Salt production was located in the northeastern part of the Border Region, while the exports were in the southern region. The transportation relied on peasants as unpaid labor, trekking on a rugged mountain road spanning 700 kilometers, known as the ‘official-supervised civilian transport.’ Xie Juezhai wrote a petition opposing this harsh policy, stating that it burdened the people, wasted agricultural time, and went against their will. But I told them, ‘The official-supervised civilian transport is not entirely unjust and is completely justified.’ The peasants were told, ‘They must go during their agricultural leisure time, it’s non-negotiable.’”

Journalist: “The peasants in northern Shaanxi suffered greatly under your Communist Party, it was too harsh, and it forced you into a difficult situation?”

Mao: “Yes. After Germany invaded the Soviet Union in 1941, I was worried that the Soviet Union might not be able to continue its support. So we sought a new source of income: opium poppy cultivation. A few weeks later, Yan’an purchased a large quantity of opium poppy seeds. The following year, we began cultivating opium poppies on a large scale.

I referred to this as the ‘Revolutionary Opium War.’ In Yan’an, opium was discreetly referred to as ‘special goods.’ To avoid a tarnished reputation, we planted a lot of sorghum around the opium fields, with the opium poppies hidden in the middle and not visible from the outside. In August 1942, a Soviet person in Yan’an bluntly asked me while playing mahjong, how the Communists could ‘openly cultivate opium poppies?’ I remained silent, and Deng Fa answered on my behalf, saying, ‘Opium poppies can make money, and with money, we can fight against the Kuomintang.’ A detailed investigative report was published in a newspaper in Xi’an, indicating that there were 30,000 acres of opium poppy cultivation in the Shaan-Gan-Ning Border Region.”

Journalist: “Wow, you cultivated opium poppies on such a large scale, 30,000 acres, which is equivalent to 180,000 mu (Chinese unit of land measurement)? Have you become the Communist Party’s opium king?”

Mao: “Yes, the main area for opium poppy cultivation was adjacent to the jurisdiction of General Deng Baoshan of the Kuomintang Army. General Deng was an old friend of the Communist Party, and he had a Communist Party member serving as his secretary. He would visit Yan’an from time to time and handed over two important ferry crossings on the Yellow River to the Communist Party, ensuring smooth communication between Yan’an and other base areas.

General Deng also cultivated opium poppies and was known as the ‘Opium King.’ He and I facilitated each other’s interests. When Chiang Kai- shek considered replacing General Deng, as soon as I heard about it, I telegraphed Zhou Enlai in Chongqing, demanding that Chiang stop the mobilization. Otherwise, I would use force to annihilate the deployed troops. Chiang had no choice but to abandon the idea of replacement.

Opium poppy cultivation resolved our financial difficulties for the year.

On February 9, 1943, I telegraphed Zhou Enlai, saying, ‘The financial difficulties in the Border Region have been overcome. In 1943, the CCP sold 44,000 kilograms of opium poppy, valued at 2.4 billion French francs, equivalent to 700 million US dollars today.’”

Journalist: “Wow, the income from opium poppy cultivation amounted to 700 million US dollars in a year?”

Mao: “Yes. In 1944, Xie Juezhai stated that we had become wealthy. The living conditions of cadres in Yan’an greatly improved. During meals, we started having desserts, such as cakes, sugar, fried peanuts, and noodle pieces, as well as pears and dates. There were over a dozen dishes on each table, and there was always a lot of food left uneaten. Cadres from other base areas were amazed by the abundance of food in Yan’an. The food at the Yan’an Party School consisted of four dishes and one soup. There was a large basin of braised pork with four square pieces, ensuring that you could eat your fill. ‘Mao Zedong has gained weight!’ General Deng Baoshan congratulated me when we met again in June 1943.”

Journalist: “The Communist Party became wealthy from opium cultivation, and you gained weight from enjoying good food?”

Mao: “Yes. In 1944, we stopped cultivating opium poppies because there was an oversupply, and the external market was saturated. To this day, the common people have a ‘respect the Communist Party but keep a distance’ attitude. The relationship between Communist Party members and the local people was limited to work requirements. During the New Year, we would visit villages to perform symbolic yangge dances and exchange New Year’s greetings.

Poverty resulted in a high mortality rate in the Shaan-Gan-Ning Border Region. Xie Juezhai wrote in 1944: In Yan’an City, 183 people were born, but 224 people died. In Zhidan County, the birth rate was 3%, and the death rate was 14%. As for the reasons, Xie Juezhai said, ‘The clothing, food, and housing conditions are all meager. People are afraid of leopards preying on livestock, and humans live together with animals. There are no doctors when they fall ill.’ In 1944, Minister of Finance Li Fuchun also said that the Border Region was ‘financially prosperous but not population-wise.’”

Journalist: “There were more deaths and fewer births among the people of northern Shaanxi, resulting in a decrease in population, similar to what happened in Jiangxi?”

Mao: “Yes. In Yan’an, I implemented the policy of ‘consolidating our forces and streamlining administration.’ In reality, to conquer China, we needed more cadres and more soldiers. It was impossible to streamline administration while having elite forces. The slogan was used to remove old, weak, sick, and politically unreliable individuals from the cadre ranks and send them to engage in production. To prevent them from escaping, these individuals had to be resettled in more central areas.

People were well aware of the inflation in the Kuomintang-controlled areas, and the Shaan-Gan-Ning Border Region was no exception. Xie Juezhai’s statistics showed that in 1944, compared to the early years of the Communist Party’s arrival in 1937, the price of salt had increased by 2131 times, oil by 2250 times, cotton by 6750 times, and matches by 25,000 times. In a 1942 article titled ‘Can’t Afford a Wife’ published in the Liberation Daily, it mentioned that in the past, one could marry a wife for tens or a couple of hundred yuan, but now it would cost several tens of thousands of border currency to marry a widow.”

Journalist: “So the people of northern Shaanxi were impoverished by the Communist Party, to the point where they couldn’t even afford to marry?”

Mao: “Yes. The Communist Party’s policy was ‘reducing rent and interest,’ but usury was rampant in the Shaan-Gan-Ning Border Region. The reason was that the government provided very little loans, so people had to rely on private loans to make up for it, and the interest rates were left to be determined by individuals. Xie Juezhai recorded in 1944, ‘The general interest rates for loans ranged from 30% to 50% per month.’ Even more terrifying was that within five days, the interest rates could reach 15% to 20%. Some peasants, forced to sell their green crops to raise funds, would sometimes receive a price equivalent to only 5% of the grain price at harvest.”

Journalist: “Wow, the exorbitant rates of private usury indicate that the common people were indeed in dire financial straits?”

Mao: “Yes. After ruling for many years, Yan’an, like other old base areas, was extremely poor, backward, and impoverished.”