1937: 13,859 1938: 15,972 1939: 52,250 1940: 97,354 1941: 200,000
The sharp increases from 1939 on were to fund Mao’s aggressive expansion of both territory and army. Coercion and violence were clearly rife, as the region’s Communist chief secretary, Xie Jue-zai, noted in his diary for 21 June 1939 that peasants were being “driven to death” by tax collectors. (Xie was one of the few to keep a diary, thanks to his high position and his long relationship with Mao, which went back to Mao’s youth.) In 1940, grain tax doubled in spite of severe bad weather and famine. And it doubled again in 1941, even though the harvest was 20–30 percent down on the previous year.
Mao was disliked by the locals — a fact he knew, but had no impact on his policy. He later told senior cadres a story about a peasant complaining about heavy taxation. After a county chief was struck dead by lightning, the peasant said: “Heaven has no eyes! Why didn’t it strike Mao dead?” Mao told the story as a way of saying he was responsive to discontent, and claimed he had had grain tax reduced as a result. As a matter of fact, the lightning and the peasant’s curse occurred on 3 June 1941, well before that year’s unprecedentedly high tax was announced, on 15 October. Mao doubled the tax
On another occasion, Mao revealed that someone who, according to him, “was feigning madness” lunged at him and tried to assault him — because of the heavy taxes. Mao did not quote other stories that went the rounds, including one about a peasant who cut the eyes out of a portrait of Mao. When interrogated, he said: “Chairman Mao has no eyes,” meaning: “There is no justice under his rule.” Mao’s response was simply to cook the figures. In 1942 and 1943, government announcements understated taxes by at least 20 percent.
The Communists claimed that taxation in Yenan was much lower than in Nationalist-ruled areas. But Chief Secretary Xie himself noted in his diary that grain tax per capita in 1943 was “high by the standards of the Big Rear [Nationalist area].” Sometimes, he recorded, grain tax “almost equals the entire year’s harvest”; the state took the astronomical figure of 92 percent in the case of one family he cited. For many, “there was no food left after paying the tax.” Large numbers tried to flee. According to the Communists’ own records, in 1943 over 1,000 families fled from Yenan County alone, which was no small feat, as the whole place was guarded around the clock, and the county was not on the border of the Red area, which was roughly the size of France.
THE REDS FOSTERED the myth that Yenan was under tight economic blockade by Chiang Kai-shek. In fact, there was plenty of trade with Nationalist areas, and the person Chiang selected to place on Yenan’s northern frontier, General Teng Pao-shan, was a man who had longstanding ties with the Communists. His daughter was a Party member, and actually lived in Yenan, which he sometimes visited; he also had a Communist secretary. He let the Reds take over two crucial border crossing points on the Yellow River, which gave them uninterrupted communications with their other bases. In addition, his men bought arms and ammunition for the Reds. Chiang tolerated this state of affairs because he did not want an all-out civil war, which Mao promised to start if he did not get his way.
The Yenan region had considerable assets. The most important marketable one was salt. There were seven salt lakes, where all that had to be done, as one 1941 report noted, was “just to collect it.” In the first four years of their occupation, the Reds produced no new salt, and simply used up the reserve built up before they arrived. “The salt stock of decades has been sold out,” the 1941 report said, and the territory “is in a salt famine.” The regime was not only extremely slow to maximize this asset, it had no plan. This reflected the fact that Mao treated Yenan, like the other areas he occupied, as a stopover, inflicting an economic approach akin to slash and burn, with no attention to long-term output.
By mid-1941, the regime had belatedly come to recognize salt as “the second-biggest source of [domestic] revenue” after the grain tax, and a key money-spinner, which soon came to account for over 90 percent of export earnings. The salt was in the northeast of the region, but the export market was over the southern border. As there was no railway or navigable river, let alone motor vehicles, it had to be carried some 700 km on steep, twisting paths. “Transporting salt is the harshest form of taxation,” one Yenan governor wrote to the emperor under the Manchu Dynasty; “those who are poor and cannot afford animals have to carry it on their backs and shoulders, and their hardship is untold …” “Today,” Chief Secretary Xie noted, “it is not much different from the old days.”
