In a significant political development, an article published by the Chinese state media in June 2026 has sparked concern and alarm among observers regarding potential government actions towards private enterprise. The article, titled “Three Major Reforms: An Unprecedented Deep Social Transformation,” is accompanied by a politically charged label of “Great Journey.”
The piece glorifies the Chinese Communist Party’s (CCP) historical “Three Major Reforms” implemented between 1953 and 1956, particularly focusing on the “cooperative management” of capitalistic businesses. This initiative involved forcibly converting private property into public ownership and has been rebranded as a “valuable experience” in the context of China’s modernization.
This raises a critical question: How does the CCP intend to implement a modern version of this “cooperative management,” and have they already initiated this process?
The article’s praise of past government policies has led many to sense an unsettling familiarity with historical events. To grasp the potential implications, it is essential to revisit the era of the “Three Major Reforms” and what transpired during that period.
Shortly after the establishment of the People’s Republic of China, the CCP launched the “Five Antis Movement” targeting private entrepreneurs as a means to eradicate private ownership. This marked the first significant political movement post-establishment and set the stage for the “Three Major Reforms.”
Despite being officially titled as a movement against bribery, tax evasion, theft of state property, fraud, and espionage, the Five Antis Movement essentially served as a strategy to confiscate wealth from capitalists. For instance, the so-called “anti-tax evasion” measures demanded the payment of back taxes, going as far back as the Republic era. The tax bills levied upon these business owners were often exorbitant and unpayable, leading many to ruin and despair.
In Shanghai, a significant number of capitalists felt trapped and unable to escape their situation, fearing accusations of fleeing to Hong Kong if they attempted suicide by jumping into the Huangpu River. This sense of hopelessness drove numerous business owners to take their own lives, with at least 876 reported suicides in just a span of two months in early 1952.
Chen Yi, the mayor of Shanghai at that time, reportedly greeted his colleagues daily with the question, “How many parachutists today?” referring to the businessmen who took the desperate leap from tall buildings into the streets below.
By the end of the Five Antis Movement in October 1952, the CCP had confiscated funds from private businesses amounting to over 30 trillion yuan in old currency, equivalent to more than half of the military expenditures during the Korean War.
Following the Five Antis Movement, the “cooperative management” phase aimed to eliminate private enterprises altogether. In June 1953, Mao Zedong proposed that a socialist transformation of agriculture, handicrafts, and capitalistic industries should be completed within ten to fifteen years, which constituted one of the central goals of the “Three Major Reforms.”
The process of “cooperative management,” formally launched in 1954 and fully executed by the end of 1956, involved the government invading private enterprises. In this new arrangement, the government sent in managers to oversee operations, with production plans dictated by state policies. While the original owners retained some nominal shares, the reality saw the government exert full control.
In a dishonest twist, the CCP introduced a scheme referred to as “buying back,” asserting that the government would purchase private enterprises. However, this “purchase” did not afford the original owners any negotiating power regarding the price and was ultimately executed without their consent.
Instead of an outright buyout, the government would pay fixed interest based on the owner’s equity stakes, a situation that would later be denounced as a form of exploitation during the Cultural Revolution, erasing any financial obligations to previous owners entirely.
The cooperative management campaign effectively dismantled the class of native entrepreneurs that had emerged since China’s late Qing dynasty reforms. By late 1956, privately-owned businesses had largely vanished, resulting in over 800,000 former owners stripped of their assets.
Today, that brutal and forced “buyback” is being repackaged by the CCP as a magnificent transformation. This deliberate public relations effort is far from mere nostalgia; it sends a stark political message amid the current fiscal and governance crises faced by the party. It indicates that a new wave of capital seizure from private enterprises may be on the horizon.
Some may wonder if the current CCP, having integrated so deeply into the global trade system, would dare to replicate the forceful “cooperative management meetings” of the 1950s to compel private enterprises to cede control. The answer is complicated; while the methods may differ to reflect the changing times, the CCP remains steadfast in its objectives.
In the 21st century, the CCP has masked its assaults on the private sector through subtler means, exemplified by events in 2008. At that time, Bo Xilai, the former Secretary of the Chongqing Municipal Committee, initiated the “Sing Red, Strike Black” campaign, purportedly to combat organized crime. However, it served as a facade to orchestrate a systematic plundering of private economic entities, all while preparing for a coup against Xi Jinping.
The fallout of this campaign severely impacted numerous private business owners, unfairly branding them as part of the criminal underworld.
Initially thought to conclude after Bo’s downfall in 2012, Xi Jinping’s subsequent policies have instead continued along the same path as Bo’s agenda—shifting towards a comprehensive crackdown on private enterprises.
In recent years, the CCP has appeared to advocate for private businesses by introducing regulations, such as the “Private Economy Promotion Law,” proposing protection for private enterprises. However, the reality tells a different story. Reports suggest that Chinese entrepreneurs are mysteriously disappearing at alarming rates, often facing detention merely for their status as business owners.
According to renowned economist Xiang Songzuo, the prevailing sentiment among private entrepreneurs is one of resignation—they recognize that while the CCP claims to need them, its ultimate aspiration remains the elimination of their existence.
This stark relationship reveals a fundamental truth about how the CCP perceives private enterprise. Regardless of the size of a business or the contributions it makes to job creation and taxation, private enterprises are inherently viewed as disposable tools in the eyes of the Communist Party.
So, how does the contemporary version of “cooperative management” function in practice today?
Financial analysts have noted that the CCP is currently orchestrating a “nationalization without proclamation,” subtly embedded within existing legal and administrative frameworks. This is being executed through a methodical “seven-step” process designed to systematically consume private wealth.
The first step involves the infiltration of party committees into private enterprises, pursuing so-called mixed-ownership reforms, a methodology reminiscent of the proverbial frog-boiling technique. Major tech firms like Alibaba and Tencent have already been placed under CCP influence via a mechanism known as “golden shares,” providing the party with veto power on significant corporate decisions.
The second step initiates investigations into specific targets for corruption or tax evasion. This entails freezing assets and detaining business owners, pressuring them into “voluntarily” transferring their stakes to state-owned entities or accepting state investment.
The third stage involves administrative strangulation, where the government avoids outright expropriation. Instead, through administrative mandates, financing restrictions, and licensing suspensions, entire industries are forced into a corner where state-owned entities can buy them out at low prices, as seen recently in the collapsed education sector.
The fourth step presents a facade of “voluntary contribution” under the guise of common prosperity. Under political duress, many large enterprises announce substantial donations, pretending to honor social responsibilities while effectively designated as a political extraction of private wealth, akin to the historical “buyback” method.
The fifth phase focuses on the nationalization of data and platforms, where new legislation mandates that corporate data be administrated by the government. This results in the loss of core competitive advantages, as was the case with Didi Chuxing during its data recovery processes, emblematic of state-led data seizure efforts.
The sixth step introduces wartime economic mobilization legislation, which grants the party the power to requisition all private property under “emergency conditions.” This becomes a potential legal tool for seizing private enterprises in scenarios of heightened conflict or internal political turmoil.
Lastly, the seventh phase involves a rectification of historical accumulations, where private enterprises’ developmental histories are resurrected from party archives. The CCP, intertwining financial need with corporate control, has unleashed a movement reminiscent of the Five Antis Movement, designed to hash out grudges against past capitalists.
Each of these seven steps is presented with a veneer of justification and operates within the framework of purported legality. Each action taken is couched in terms of “strengthening party building,” “optimizing ownership structures,” or “regulating industry development,” with the underlying result being a systematic transfer of private wealth back to the government.
Simultaneously, amid these clandestine encroachments on private enterprises, the CCP is aggressively pursuing mergers and reorganizations among its state-owned enterprises, as outlined in the “Plan for Deepening State-Owned Enterprise Reform (2026-2029)” released in late May 2026. Local governments have begun intensive discussions on how to enlarge these state enterprises and enhance their dominant roles in the economy.
Statistics show a staggering number of merger and restructuring activities involving state-owned enterprises, with over 224 cases recorded in just the first five months of 2026. Such transformations coalesce crucial strategic industries under a few major state-owned corporations, thereby consolidating power even further.
Historically, the CCP has manipulated markets through tactics that ostensibly encourage competition. Since 2014, state-owned entities have been re-integrated, contradicting earlier assertions aimed at promoting competition.
The intent now is clearer; the restructuring since 2026 has shifted from a focus on scaling up to consolidating control. This indicates a deliberate stifling of market vitality, which may inadvertently lead to a substantial capital flight and asset scarcity.
Analysts suggest that this signifies a complete abandonment of market economic principles in core industries by the Xi administration. The traditional mechanisms meant to promote internal competition appear to be thoroughly disregarded.
From a political perspective, the CCP’s continued oppression and constriction of private enterprises becomes a predictable outcome—revealing an inescapable trap set by the regime itself.
Under the CCP’s rule, the notion of “private property rights” never experienced genuine safeguarding. If the development of the private economy during the reform and opening period had merit, then the “Three Major Reforms” were undeniably flawed. Acknowledging the erroneous nature of the “Three Major Reforms” would demand state reparations and historical redress for the 2 million landlords who suffered violence during land reform and for the countless capitalists who perished in the cooperative management movement.
To negate the “Three Major Reforms” would strip the CCP of the legitimacy it derives from its revolutionary past and its socialist assertions post-establishment.
In the logic of sustenance for the socialist regime, opening up markets is never the norm but merely a transient phase of precarious maneuvering between conflicted systems. Politically, the policies of Xi Jinping and Mao Zedong are seamless extensions of the same ideology that governs the CCP’s approach.
While some may argue that reform and opening acted as a release for private investor confidence, if the CCP never truly relinquished its quest to eradicate private enterprise—choosing instead to conceal it when needed—what was released was not confidence but a carefully crafted illusion.
During a time when the market most desperately needed reassurance, the publication of an article normalizing state plunder offers a strikingly clear political signal: the CCP has never genuinely sought reform, nor does it ever intend to.
This commentary focuses on the interrelation of historical precedents and the ongoing developments within the CCP’s governance structure in regard to private ownership—a critical lens through which to understand the current narrative in the context of China’s political landscape.