Abstract: The current social and economic problems in China are primarily resulted from the simultaneous failures of market and government and especially from their mutual re-enforcement, which can be mainly attributed to the imbalanced power distribution and the lack of market moral standards. On the one hand, the lack of market moral standards and the lack of effective rule of law lead to severe market failure; on the other hand, the over-concentration of the political power combined with a faulty legal system exacerbates the government failure. I argue that the key to reducing the double failures of market and government lies in two aspects: one is to develop a social system of power balance to achieve the efficient and equitable supply of public goods, and the other is to improve market moral standards to ensure the fair and effective functions of the market. To achieve the two goals, we can gain some valuable lessons from the 60-year experience of the People’s Republic of China since its founding in 1949.