Wed, Dec 01, 2004 - Page 8 News List

China heads for day of reckoning

By Sushil Seth

Where is China headed? To answer this question, one needs to look at what is happening in China. And the first thing to notice is how much China is riddled with contradictions. The most obvious contradiction is the existence, side by side, of an evolving capitalist economy and the Leninist political system. As Orville Schell has pointed out, "... almost every aspect of its [Chinese] society exists in a state of unresolved contradiction. Even the most knowledge-able Westerners are uncertain whether China will cohere and eventually flourish or become fractured and fail."

Chen Yun (陳雲), a veteran communist leader, compared China's new economy to a capitalist bird growing up inside a socialist cage.

Because of this duality there is a crisis of identity among the people. Who are they: an ancient civilization with so much to be proud of or a mutant society seeking to re-invent itself as an as yet unrecognizable social organism? There is a growing sense of being in a state of limbo, like losing the old in terms of culture and traditions but not knowing the new -- its replacement.

The worst-affected in this res-pect are the rural people, increasingly being forced into looking for jobs in cities. The result of such large-scale migration is that people and communities, for whom farming is as much an economic activity as a way of living, end up in an environment devoid of familiar social and cultural surroundings.

Those of rural origins not only live a socially fragmented and alienated existence, but are also denied the most minimum social and economic entitlements accruing to native urban residents. In large part that is because residency status is not portable in China -- meaning that even after they move into large overcrowded cities, migrant workers keep their old rural status. And because they lack legal status in cities, they are prey to all kinds of exploitation.

There is already a floating population of 100 million or more migrants seeking work in cities. The number is growing all the time because of a lack of economic opportunities in the countryside. The official bias in favor of consolidation of small land holdings into large farms will further push small landholders into seeking work in the cities. To this end, the Rural Land Contracting Law was enacted last year to make it possible for individual farmers to sell their land. Prior to this land has belonged to each village with user rights allotted to individual households.

According to Wang Mengkui (王夢奎), director general of the State Council Development Research Center, "Too many people and too little land makes large-scale production difficult and is therefore the greatest problem for farmers to increase their incomes."

Therefore, he said, "large numbers of [rural] migrant workers supply cheap labor [in the cities], thus helping to enhance the international competitiveness of Chinese industries."

In other words, farmers are being screwed either way. Low incomes forced many into becoming industrial workers, but once they join the urban work force, they still are paid less because they lack legal resident status.

In their article, "The Latin Americanization of China?" (Current History, September 2004), George Gilboy and Eric Heginbotham highlight the inequity of the rural situation. According to them, last year the gap between urban and rural income stood at 3:1. But "the urban-rural income disparity soars to between 5:1 and 6:1 when entitlements, services and taxes are included in the calculation."

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