Leftist ideologues have strengthened their campaign against economic reforms President Jiang Zemin plans to introduce at the 15th Communist Party Congress.
And Mr Jiang, who is also party General Secretary, has at least temporarily shelved his idea of reviving the party chairmanship.
Chinese sources said yesterday the leftists, or remnant Maoists, had concentrated their firepower on Mr Jiang's proposal to transform some large and medium-scale state-owned enterprises into shareholding companies.
This measure has already been billed as a 'major reform' to be introduced at the 15th Congress.
In leftist mouthpieces such as In Search of Truth, however, the commissars have asserted the shareholding system will lead the nation 'down the capitalist road'.
The latest issue attacked two liberal cadres, Liu Ji and Li Youwei, for saying that shareholding companies could be a form of 'social ownership system' because the shares were held by many people, not the capitalist bosses.
Mr Liu, a vice-president of the Chinese Academy of Social Sciences, is close to Mr Jiang. Mr Li is the Shenzhen party secretary.
