Communist Review - As the fruit of human civilization, the market economy has been applied by the Communist Party and State of Viet Nam properly, objectively, scientifically and creatively, becoming a socialist-oriented market economy in which human is regarded as the driving force and the top goal of development.

Market economy and human issues in the capitalist market economy

The development of human society is reflected by many criteria, including economic development in different periods and stages. From a "robbery economy" (in the words of F. Engels) in the early stage, man spent tens of thousands of years learning how to use fire to cook food and keep themselves warm, and how to tame animals, how to raise animals, how to farm, how to make simple items to meet simple and very limited needs in a small community. Gradually, when one community had a type of product to spare and needed other types of product that other community spared, the exchange began. The more developed the production became, the more frequently the exchange took place on a larger scale. In other words, from a natural economic form, mankind gradually moved to a higher economic form namely commodity production, or commodity economy. Its birth was seen as a great advance in human history, marking the development of the economy which has now developed and reached a very high level i.e. the modern market economy.

The market economy is a socio-economic form in which economic relations, exchange, purchase and sale of products and especially benefit sharing, profit seeking among others are all regulated and governed by the laws of the market. Without making profits, producers and traders have no motivation to continue their efforts, especially in promoting their production and business, so the social stagnation is inevitable. Therefore, it can be said that the market economy is an important achievement made in the long-term development in the human civilization since it appeared, not the property or the monopoly of any socio-economic form. Particularly, according to Karl Marx, in the market economy with the capitalist mode of production, "profit is the absolute law of this mode of production"⁽¹⁾. In the market economy, especially in the capitalist mode of production, profit is a central factor and an absolute driving force promoting production development, raising labor productivity and increasing the efficiency of production and business activities. Not a product of the capitalism alone, the market economy has been attributed to the development of the world economy over centuries and has risen to a new height thanks to modern capitalism.

However, the market economy, including the modern capitalist market economy, has its own basic limitations and shortcomings, even those that are not easily corrected. As Karl Marx pointed out, the absolute law of capitalists is to seek maximum profits. Without gaining maximum profits, no capitalist dares invest capital into production and business. However, Karl Marx also stated that, in the capitalism, “profit is only a secondary, derivative and modified form of surplus value, a bourgeois form in which all the sources of wealth have been erased”⁽²⁾, while surplus value and its rate “are a true expression of the extent to which capitalism exploits labor, or to what extent capitalists exploit workers”⁽³⁾ . In other words, in a capitalist market economy, it is the worker's surplus labor that creates profit and wealth for the capitalist.

As a rule, when huge profits and wealth are concentrated on the capitalists, destitution and poverty will naturally shift towards workers and proletariats. In other words, in the capitalist market economy even at present, wealth is still increasingly concentrated on one side, while poverty is still what workers cannot escape. Although workers are the main force creating wealth for the society, they enjoy very little of what they make themselves. Therefore, it would not be an exaggeration to say that, in the capitalist market economy, workers are not the target or object for the economy to serve.

In fact, in the early years of 21^st century, injustice and rich-poor divide were clearly seen with the rich people (only 1% of the world population) possessing 90% of the wealth of the whole society. In 2017, 200 million people were permanently unemployed and the present number is surely much higher. It means that, no matter how modern the capitalist market economy is, it still cannot solve injustice and the rich-poor divide is becoming more and more serious.

Human in the socialist-oriented market economy

Perceiving that the market economy is a product and a common achievement in the development of human society, the capitalist market economy cannot correct its inherent weaknesses and the workers have not been able to enjoy the results worthy of their contributions yet, the Communist Party and State of Viet Nam advocate the development of a socialist-oriented market economy despite confusing or disagreeing opinions in the society, or some unfairly saying that the CPV has abandoned the socialist path (!).

The world economy today has various market economic models, such as free market economy, social market economy, mixed market economy, each of which has its own advantages and disadvantages. After learning the experience of operation and development of these models in the world, stemming from the national development requirements and reality in the innovational period, the Communist Party and State of Viet Nam have issued a policy of socialist-oriented market economy development. For a relatively common perception of the national development path via the socialist-oriented market economy, we should have a serious and profound process of scientific researches and discussions as well as practical learning.

The term ‘socialist-oriented market economy’ was officially used in the documents of the 9^th Party Congress (April 2001) stating that "the Communist Party and State of Viet Nam advocate the consistent and long-term implementation of the policy of developing a socialist-oriented multi-sector commodity economy driven by the market mechanism and managed by the State, or the socialist-oriented market economy”⁽⁴⁾. The 12^th  Party Congress (January 2016) continued to supplement and develop the definition: "Viet Nam's socialist-oriented market economy is the one that fully and synchronously operates in conformity with the laws of the market economy and ensures the socialist orientation suitable for each development stage of Viet Nam. It is a modern and internationally integrated market economy under the management of the socialist State”⁽⁵⁾. This is quite a brave and scientific breakthrough in the CPV’s theoretical thinking.

From a historical perspective, for a long time during the process of socialism building, both theoretically and practically, people have compared socialism and capitalism in an absolute and metaphysical way. They have also thought that what is in capitalism must be rejected by socialism and vice versa, including the market economy as the result in the development of human history. It should be clearly realised that the communist society as a socio-economic form cannot have everything available in a capitalist society, but it has prerequisites in many important aspects for the birth of a new socio-economic form. One of these prerequisites is the well-developed market economy thanks to the extremely highly and strongly developed production force. Lenin soon realized the mistake of haste in formulating and implementing the Wartime Communist Policy that he promptly corrected by proposing a New Economic Policy (NEP) for Russia to develop the production of multi-sector goods and start the market economy. He strongly asserted that, “we cannot conceive of socialism other than socialism based on all the lessons drawn by the great civilization of capitalism” ⁽⁶⁾.

Definitely abandoning the centralized economic system and bureaucratic subsidies to officially start the socialist-oriented market economy is an objective, creative, independent and suitable choice that follows the movement trend of the modern world economy. Viet Nam launches a socialist-oriented market economy in order to build a country where people are both the subject and the object. On the one hand, that economy respects and obeys the objective laws of the market economy where production and business must create profit and accept law-based competition to promote production and business. On the other hand and more importantly, that economy must train an increasingly growing production force, regarding human as both the driving force and the goal of development. Last but not least, the market economy advocated by Viet Nam must be guided by the natural principles of socialism regarding property rights, how to organize production, and how to distribute products. 

The Communist Party and State of Viet Nam advocate and consistently operate the market economy mainly by and through the market mechanism, but still attach great importance to the management and regulation of the State, fairly but not evenly distribute the results to all its members so that no one, including the weak, is left behind. That orientation is extremely important to the entire process of socialist-oriented development. However, this combination does not take place unmethodically, subjectively, and in a voluntaristic manner as some misunderstand or intentionally criticize. The choice is based on invaluable practical experience in the history, grasping the objective trend of the time to absorb what considered the best of the capitalist market economy, selectively absorbing the achievements of human civilization, exploiting the active role and driving force of the market economy in promoting the development of production capacity and labor socialization, promptly applying scientific and technical advances and new technologies, and gradually limiting as well as overcoming the shortcomings and injustices that the economy has not been able to do since its birth.

Although it must abide by market laws and fully exploit natural and social resources to realize sustainable development goals, the socialist-oriented market economy is designed to serve not some but all people. That economy must see people as a driving force and, more importantly, regards them as the goal. These people are not only people in classes but also human beings, with the word HUMAN in capital letters like Karl Marx mentioned. That orientation stems from the essence of the socialist ideal which is humane and expected to bring justice to everyone. On the way to reach that goal, they must take the inherent advantages of the market economy, improve the effectiveness, efficiency and regulatory power of the socialist State, foster and use human resources as one of the fundamental motives, and develop all other social resources.

The market economy in general and Viet Nam's socialist-oriented market economy in particular are capable of stimulating independence, dynamism, efficiency, freedom of creativity, competence for invention and prompt application of the latest technologies to all spheres of social life. Those capabilities are attributed to the fact that the competition for survival and development in this economy greatly depends on them. All of them will not work without the freedom that is protected by the law and encouraged by the society.

In a globalized world today, fast and healthy development is facilitated not only by a domestic market but also a international market. Therefore, apart from building trust among domestic consumers, it needs to do so among foreign ones. It requires producers and businessmen to have business culture and ethics added to other key capabilities and qualities. Today, if a unit, an enterprise or an economic group does business via opportunism, theft of designs and copyrights, or making fake goods without regular renovation, innovation, creation, invention and prompt application, it is bound to fail in the market place.

In the market economy in general and the socialist-oriented market economy in particular, everyone has the right to get rich, but he mustn’t do so in an unethical and illegal way. He must be responsible to himself, the society and the country. It is not only a moral requirement or a moral responsibility but also a social responsibility and cultured enrichment. This is very central in the context of Viet Nam intensively integrating into the world economy. Therefore, the driving role of cultured people in the economy is the key to creating opportunities to win in fair and healthy competition, promoting production development.

History shows that the strength of the capitalist market economy lies in its ability to effectively exploit resources, especially highly intellectual human resources. Therefore, in order for the socialist-oriented market economy to get ahead and win the fierce competition on the current economic front, it is increasingly necessary to train, foster and use highly intellectual labor sources in an effective way. Without these resources and an abundant force of workers capable of absorbing high technologies in the era of digital transformation and artificial intelligence, Viet Nam will find it difficult to become a developed country. A highly developed economy is also a necessary condition to solve many difficult social problems, such as inequality, reducing the growing gap between the rich and the poor, preventing extreme rich-poor divide which can threaten social stability.

In recent decades, some capitalist countries with developed market economies have taken measures to reduce social inequality, improving the living standards among a part of workers. However, due to the nature of seeking maximum profits by all means, the irreconcilable (let alone resolved completely) inherent contradictions in the capitalist society, the capitalist market economy cannot eliminate injustice, social inequality and growing rich-poor divide. Therefore, in order to reduce those contradictions and limit the negative impacts of the capitalist market mechanism, the socialist-oriented market economy needs effective measures of the State to orient development in the right direction for the sake of its citizens and the national prosperity. Regarding this, the 12^th Party Congress reaffirmed: “The State plays the role of orienting, building and perfecting economic regulations, creating a fair, transparent, and healthy competitive environment, using tools, policies and resources to orient and regulate the economy, promote production and business, protect the environment, practice social progress and justice in each development step and policy. The State should promote the people's mastery role in socio-economic development”⁽⁷⁾. Appreciating people and promoting their mastery role are also highlights in the development path of socialist-oriented market economy in Viet Nam, which is missing in the capitalist market economy.

In the past decade, strikes and demonstrations of various sizes have been reported in many capitalist countries, demanding equality of rights, social welfare and protesting against over-exploitation and injustice. Some strikes have attracted not only the poor and the disadvantaged in the society, but also the middle-class and the well-off to join, paralyzing many areas of production such as mining, automobile manufacturing or key transportation sectors such as air, subway, train, etc.

Unlike in capitalist market economies, economic development and effective resolution of social problems had always been firmly advocated by the Communist Party and the State of Viet Nam from the time they accepted the operation of multi-sector commodity economy based on the market mechanism to the time they consistently affirmed to build a socialist-oriented market economy. This is a very important criterion that further highlights the socialist orientation of Viet Nam's market economy. To achieve that goal, it is necessary to raise the professional skills of the production force, especially those of human resources for economic development and always integrate them with the comprehensive human development goal, as "the level of economic development materially facilitates the implementation of social policies, but the social goal is the aim that economic activities are expected to attain"⁽⁸⁾.

In other words, in a socialist-oriented market economy, people are regarded as the driving force not only for economic goals but also, more importantly, for social goals and their comprehensive development in all aspects of their life. Karl Marx once said that, in a capitalist market economy, each one sees others as the ones to exploit. Today, in the socialist-oriented market economy, we put people in the first place and regard them as the driving force and the development goal. Therefore, the Communist Party and State of Viet Nam did not wait until the economy is highly developed for realizing social goals. At the very beginning, the Communist Party and the State of Viet Nam advocated "economic growth together with social progress and justice in every step and throughout the process of development"⁽⁹⁾. The advocacy has been consistent throughout the Party Congresses and increasingly concretized in all aspects of the social life in order to facilitate human development in the best way. It is a right, scientific, bold, creative, and humane choice. The inevitable choice is based on experience, selective inheritance of the strengths in the development of the market economy in the history. In addition, it shows socialism’s human nature to affirm that building a socialist-oriented market economy with people as the driving force and development goal is a right choice./.

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(1) Mark K. and Engels F.: Complete Volume, Publishing House of National Politics, Hanoi, 1993, vol. 23, p. 872

(2) Mark K. and Engels F.: Complete Volume, Publishing House of National Politics, Hanoi, 2000, vol. 46, part II, p. 160

(3) Mark K. and Engels F.: Complete Volume, Publishing House of National Politics, Hanoi, 1993, vol. 23, p. 322

(4) Communist Party of Viet Nam: Documents of 9^th Party Congress, Publishing House of National Politics, Hanoi, 2001, p. 23

(5) Communist Party of Viet Nam: Documents of 7^th Party Congress, Publishing House of National Politics, Hanoi, 2016, p. 25

(6) Lenin V. I. : Complete Volume, Publishing House of Progress, Moscow, 1977, vol. 36, p. 334

(7) Communist Party of Viet Nam: Documents of 7^th Party Congress, Party Central Committee office, Hanoi, 2016, p. 103

(8) Communist Party of Viet Nam: Documents of 6^th Party Congress, Publishing House of Truth, Hanoi, 1987, p. 86

(9) Communist Party of Viet Nam: Documents of 8^th Party Congress, Publishing House of National Politics, Hanoi, 1996, p. 113

This article was published in the Communist Review, No. 953 (November 2020)