After the establishment of the PRC, Chen was a key figure in moderating many of Mao's radical economic ideas and participated in the drafting of the First five-year plan.
[3] After Chiang Kai-shek turned against the CCP in 1927, Chen fled to his hometown, but soon returned to Shanghai and secretly continued his work as a labor unionist.
He left the Long March sometime in the spring of 1935, returning to Shanghai, and in September 1935 he went to Moscow, serving as one of the CCP's representatives to the Comintern sent by the Fifth Plenum Politburo, although he did not take part in the work of the delegation because he was sent to the Stalingrad Tractor Factory as a punishment for his participation in the Luo Zhanglong faction.
His writings on organization, ideology, and cadre training were included in the important study materials for the Yan'an Rectification Movement of 1942, a campaign of political persecutions which consolidated Mao's power within the Party.
[7] Chen argued that the approach should rely on both economic and political mechanisms (as opposed to prohibition), including regulating the value of competing currencies and controlling trade in key commodities.
[8] Another Chen Yun's contribution to the early development of the Chinese economy was his stabilization of prices in Shanghai after the Nationalist government failed to curb the financial crisis caused by speculations of corporate monopolies.
In early 1952, Zhou Enlai led a team to draft the first Five-Year Plan which included Chen, Bo Yibo, Li Fuchun and General Nie Rongzhen.
[12]: xx Mao's idea, rather, was to devolve powers to provincial and local authorities, which were in practice Party committees rather than state technocrats, and to use mass mobilization rather than either a detailed central plan or the market to promote economic growth.
According to a Cultural Revolution attack on him by the radical group within the finance system, he reported the peasants as saying: "In the days of Chiang Kai-shek we had rice to eat.
Later that year he was "evacuated" from Beijing, as were many other inactive or disgraced first-generation leaders, as part of a supposed plan preparing against the eventuality of an invasion by the Soviet Union with whom China had a serious split.
Following the death of Mao in September 1976 and the coup d'état against the radical Gang of Four a month later, Chen became increasingly active in the country's political life.
He and General Wang Zhen petitioned Party chairman Hua Guofeng to rehabilitate Deng Xiaoping at the March 1977 CCP CC Work Conference, but were turned down.
[14] After Deng was rehabilitated later that year, Chen led the attack on the Maoist era at the November–December 1978 CCP CC Work Conference, raising the sensitive "six issues": the purges of Bo Yibo, Tao Zhu, Wang Heshou and Peng Dehuai; the 1976 Tiananmen Incident; and, Kang Sheng's errors.
[15] Chen's intervention tipped the balance in favor of movement toward an open repudiation of the Cultural Revolution and Deng Xiaoping's promotion, in December 1978, to de facto head of the regime.
In April and July of that year he made further provocative statements in internal Party meetings, although their authenticity was denied (in an equivocal manner) by official spokesmen.
[citation needed] In July, Chen developed these themes in another exposition (which also included some sarcastic observations on the late Chairman's taste in literature).
Moreover, he still posited for the state to retain an active role in market development and planning, a policy that would influence future generations of leadership, including Jiang Zemin, Hu Jintao, and Xi Jinping.
He played an active role in the "Anti-Spiritual Pollution Campaign" organised in late 1983, to help safeguard China's political status quo and domestic stability.
Chen Yun was widely admired and respected for striking a balance between excessive laissez faire capitalism and retaining state leadership in guiding China's market economy.
Because Chinese farmers were not eligible for bonuses since they were not technically state employees, China's agricultural sector, which had prospered in the first stage of the reform, was especially damaged by inflation.
Although in his "secret" pronouncements of 1979 Chen had shown an unusual personal disdain for Mao, he also indicated he shared the late Chairman's worries that China would abandon socialism and revert to capitalism.
He supported the vigorous campaign in the early 1980s against the "three kinds of people", a general purge of all those who had been identified with radical factions during the Cultural Revolution.
[6] In 1989, Chen, alongside Deng Xiaoping, Li Peng, and others, was among the Party elders responsible for making the key decisions concerning the student-led Tiananmen Square protests.
After the Tiananmen Square incident in June 1989, Chen Yun's influence grew within the party due to the removal of reformists Zhao Ziyang and Hu Qili from the Politburo Standing Committee.
However, after Deng Xiaoping's southern tour in early 1992, Chen Yun and the conservative faction's influence within the party waned significantly.
Chen was praised for implementing many of the reforms that made the new generation of Chinese richer, but was also admired for striking a balance between too much laissez-faire economics and retaining state control over key areas of the market.
But later, Chen realized that the state still needed an active iron hand involvement in the market to prevent the private sector from becoming untamable.
During the Cultural Revolution, Chen was able to escape political persecution, especially in Mao's time, as he carefully avoided challenging the top leadership too much.
Whatever the wisdom of his substantive positions, Chen consistently appeared to act on principle rather than for personal advantage, and retained his influence in the party throughout the Mao and Deng eras.
[16][19] His eldest son, Chen Yuan, is the founding Governor of the China Development Bank and the former Vice Chairman of the National Committee of the Chinese People's Political Consultative Conference.