Struggling Under The War And Embargo: Study On The Fiscal Reform Of1932in The Central Soviet Area

With the firmness and development of the Central Soviet Area,the time of suppressing locallandlords to get money came to the end.The government began to reform the financialsystem,which would be more normal.Before the central government established the whole taxsystem, the Min Xi Soviet Area had already grasped practical experience. The central governmentused some financial methods to control the privately-run business and promote the development ofthe cooperative economy indirectly. In the background of war and blockade, to survive is the firstrational goal for the financial leaders. Collecting silver dollar is the most important rule of CentralSoviet area.In the case of silver dollar’s outflow and trade deficits, Soviet bank issued an indirectobligatory currency to absorb the inner silver dollar.The government developed trade actively andcast silver dollar to increase the currency. Because the market was blocked, there was scissorsbetween the transaction between the Soviet and White Area. The silver dollars were bound tooutflow.The Chinese Communist Party was still unable to overcome the shortage of silver.Andthey suppress the privately-run business so that the inner market became stagnant.So they couldnot obtain the most essential goods and materials produced in the White Area.Meanwhile, theoriginal interior silver dollar had been consumed by the war, which led to persistent inflation.Later the Red Army returned to fight local tyrant. However, such policies aggravated the Sovietinternal resource consuming.As the military was defeated, the Chinese Communists had beenforced to give up the base, and they failed to reform the financial system.Using financial strengthto intervene in market and the outflow of resource, was the important reasons for failure.