The Standard
Jiang Wenran Yet evidence is mounting that the high-GDP-centered
development paradigm is too costly to sustain: rural, urban and
environment-related protest movements are moving from being localized
and isolated events to becoming a widespread and serious social crisis. Some
may point to Beijing's newly revised GDP figures as proof of China's
successful modernization: its national strength is now 17 percent more
than previously thought, allowing China to leap over Italy, France and
Britain to become the fourth largest economy in the world; its economic
structure seems to be more balanced with a much bigger service industry
than previously reported; and China's foreign trade grew by nearly a
quarter last year while its foreign reserves tripled. Yet other recently released numbers, which have received less coverage, indicate a troublesome trend. As
revealed by the China Human Development Report 2005, regional
disparities are threatening the country's growth potential, and the
widening urban-rural income distribution gap has reached a dangerous
level. Compiled by a group of Chinese researchers for the United
Nations Development Program, the report demonstrates that in all major
categories of the human development index - from per capita income to
life expectancy to literacy rate - regional imbalances are severe and
growing. It concludes that China's Gini coefficient, a
measurement of a country's income inequality, has increased by more
than 50 percent in the past 20 years, with urban dwellers earning
nearly four times that of rural residents. At 0.46, the
mainland's Gini coefficient is lower than in some Latin American and
African countries, but its urban-rural income inequality is perhaps the
highest in the world. The new GDP numbers only make the
inequality worse, and when systemic factors biased against the rural
population are included, the urban-rural income ratio is as high as six
to one. The UNDP report also shows that the inland regions lag behind in education, especially among the female population. Only
two decades ago, China was one of the most equal societies on earth.
Today, it ranks 90th in the UNDP's 131-nation human development index. It
is ironic that while 250 million people have been lifted out of poverty
in record time - a proud achievement that no one denies - the mainland
is also leading the world in creating one of the most unequal societies
in history. The Chinese government has repeatedly told the world
that it needs social stability to develop its economy, and Beijing
claims to value economic and social rights more than political rights. The
question is whether China's traditional political control plus the new
economic and social exclusion of the majority of its population can be
accepted as a model of development by those who are now excluded from
China's growing prosperity. Newly released reports from the
central government cite 87,000 incidents of public order disturbances
last year, up 6.6 percent from the 74,000 figure in 2004; the number of
events that interfered with government functions jumped 19 percent,
while protests seen as disturbing social order grew by 13 percent in
2005. Some say that the figures are not surprising and that
these may not even be new developments: they show that Beijing now
allows more reporting of these protests that have existed for a long
time. Beijing even puts its spin on reports of social disorder,
claiming that it is now more democratic by allowing the protests to
occur and then informing the public about them. Despite the
differences in assessment, the emerging consensus is that various
grassroots protests are increasing in numbers, are better organized,
and often turn violent when local officials are no longer seen as
working to solve ordinary people's legitimate grievances. Again,
the UNDP survey of Chinese public perception of income distribution
gaps reveals popular demand for social justice and potential support
for radical actions: more than 80 percent of those surveyed believe
that China's current income distribution is either not so equitable or
very inequitable. Meanwhile, a recent global study by the Pew Global Attitude Project seems to contradict such pessimism. Around
72 percent of Chinese, the highest among 16 countries polled, expressed
satisfaction with national conditions. Although the survey acknowledges
that the sample is disproportionately urban and is not representative
of the entire country, it does convey one important message that the
pollsters failed to recognize: mainlanders have extremely high
expectations about benefiting from the country's ongoing economic
expansion; if such high expectations are not met in the near future,
their frustrations may turn to demands for equity and social justice. Between
the 1950s and 1970s, most mainlanders were very poor, but relatively
equal; thus social protests were rare and the Chinese Communist Party
asserted control with little concern for large-scale grassroots unrest.
Today's China, after more than two decades of reform, is much more prosperous but, at the same time, a very unequal society. Historical
experiences show that when a country is embarking on rapid economic
growth, social mobility accelerates and people's expectations for their
own share of the prosperity increase. Yet, at the same time, income
distribution gaps widen and, with a few exceptions, only a small
portion of the population enjoys the benefits of the country's
modernization drive. Such a paradoxical process often results
in rising resentment among the populace and leads to large-scale
protests for a more equitable distribution of wealth. China
today is at such a crossroads of unprecedented prosperity, high, unmet
expectations, and growing frustrations with perceived social injustice. The
current leadership, headed by President Hu Jintao and Premier Wen
Jiabao, is keenly aware of the growing disparity and its serious
consequences. After years of promoting Deng Xiaoping's famous call - to
get rich is glorious - the harmonious society seems to have become a
central pillar of the Hu-Wen approach to easing China's social
tensions. Despite a number of measures - ranging from
investment in remote regions to elimination of agricultural taxes to
campaigns against corruption - social unrest is on the rise. With some
of the recent bloody confrontations between peasants and local
authorities, many wonder if some kind of a tipping point for a social
crisis will arrive soon. Revolutionary change, most evident in
Russia in 1917, is precipitated by three conditions: first, the masses
can no longer be governed; second, the ruling elites can no longer
govern; and third, the social forces are fully mobilized under the
leadership of a revolutionary party to overthrow the existing regime.
By these standards, China is nowhere close to the tipping point. Yet
it would be a profound mistake to take comfort from such abstract
conclusions. The first two conditions have been progressively
deteriorating in recent years: widespread social protests are
increasing; and the corruption of government and party officials, and
the plight of ordinary citizens at the hands of abusive local
officials, have weakened the governance structure. A deadly
combination of these two elements could lead to a widespread belief
that the majority of the population is not left behind because of its
own weakness in competing with others for a better life; rather, it is
the corrupt officials and the privileged few who have enriched
themselves through exploitation and at the expense of the masses. This perception may foster pressures that fundamentally reconfigure the existing social, economic, and political order. This
process may well be accelerated if the inevitable economic slowdown in
the coming years and natural, environmental and other human-made
disasters occur simultaneously. An externally-imposed,
alternative political mechanism is unlikely, if possible at all, given
China's tightly controlled conditions. Yet a governance crisis of such
magnitude is likely to trigger an internal split within the party
ruling elites, with reform-oriented forces openly confronting
hardliners who advocate total control by force. The most
challenging task for China and the world today is how to avoid such
dangerous showdowns with reforms that effectively address the issue of
income inequality, social injustice and lack of democratization. Professor
Jiang Wenran is the director of the China Institute at the University
of Alberta, Canada. Reprinted with permission by Jamestown Foundation,
China Brief
China
continues to impress the world with its high GDP growth, staggering
trading volumes and surging consumption appetite. Most figures out of
Beijing look remarkable, indicating a momentum that the Middle Kingdom
is reclaiming its great power status at a speed faster than most
forecasts.
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