According to a report released on February 28, 1962, by a UN panel of ten experts, military spending around the world was "equal to about eight or nine percent of the annual output of the total materials and labor in the world; it was at least two thirds of the total national income of developing countries, but according to some estimations it was nearly equal to their entire national income. It almost amounted to the value of the entire annual global goods production and equivalent to about one half of the world's capital reserves." Moreover, the situation was still developing. When the panel of experts made this estimation, military expenditure was 120 billion dollars. It increased to 200 billion in 1969, 500 billion in 1980 and reached almost one trillion in 1985. An huge amount of material and human creativity was being used for destruction rather than construction. Although many promises had been made with the emergence of ever more complicated new weapons, the world was less and less safe. This situation had profound and lasting effect on humanity's sense of security.
The Chinese government had always stood for disarmament and against arms races. The nature of socialism and the national situation meant that it was sincere in this. In fact, our government not only created favorable conditions for economic development, but had also contributed to the process of global disarmament. It did this using methods such as troops reduction, tightening of military expenditure, reassigning military installations for civil or joint military-civilian use, producing civilian goods instead of military equipment and supporting local construction work. Even so, at the time, we were not satisfied with our own situation.
The military expenditure of our country was very low and its quota in the government budget dropping year by year. In 1985, our military expenditure was only 19.1 billion yuan, or six billion dollars. This was about two percentage of America's and not even a fraction of that of the Soviet Union. However, we had twice as many troops as America, and the same amount as the Soviet Union. Quite a large amount of military expenditure was spent on wages for the many soldiers and officers. This was a heavy burden for our country and people, and also directly restricted weapons development, and progress to soldier combat effectiveness. According to some estimations, the money we spent in developing weapons in the thirty years between 1953 and 1983 was 20 billion yuan less than the U.S. spent in 1982 alone.
There were a large number of officers and soldiers and the structure of the military was in need of rationalization. According to relevant materials, the ratio between officers and soldiers in the Soviet Union was 1:4.56, in America it was 1:6.15. In Germany the ratio was 1:10, and in France, 1:17. However, it was 1:2.45 in China, where on average every officer led two and a half soldiers.
The first reason for so many officers was that there were so many different military offices. In every military region there were dozens of leaders above ministry level; as Deng Xiaoping said, if they wanted to play Mahjong they would have to sit at several tables. From 1975 to 1985, he would often comment acerbically: "Such bulky institutions could not command troops in battle, let alone achieve a victory!"
