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can china stay on the road it's on?

shanghai's pudong new areashanghai's nanjing east road shopping area

While China's double-digit growth has transformed its cities and surrounding urban areas, its rural poor have become poorer and much of their support systems, such as free or nearly free health care and education, have collapsed. Concern about the widening economic gap and the growing unrest in the countryside led the Communist Party government in March 2006 to promise to work to remedy the situation by injecting a further $5 billion into the rural economy over the next 12 months. However, this new spending amounts to a little under $7 a head for the 800 million people who still live in rural China.

Nicholas Bequelin
a China researcher for Human Rights Watch.

[We have these headline figures of 8.5 percent economic growth in China. How many people are benefiting from this growth?]

It's a difficult question. On the one hand, China's economic growth has allowed the government to lift out of poverty 200 to 300 [million] people in terms of annual income, but at the same time, because capitalism is totally unchecked in China, there is no mechanism for balancing it; there is no control over what the government chooses to do. The past 20 years have seen the emergence of a true labor underclass as in the sense of Europe in the 19th century. …

[You've said that one should consider how there are actually two Chinas.]

There really seem to be two Chinas today: … China A and China B. China A is all the major big cities where business men and foreign governments go: Beijing, Guangdong, Shanghai, Shenzhen. … [It's] modern and confronting a lot of the problems that developed countries are facing: … problems of urbanization; too many cars; social problems; the rise of criminalization; the education, health system; the judicial system; lawyers and etc.

Then you have China B, the undeveloped or developing China, the China which is the vast majority of the country, the majority of the population and the majority of the land mass. This China in development is still very poor, not getting very much better, because all the economic growth is concentrated in the cities, and they face developing countries' problems: not enough water, land, economic resources, infrastructure; a very low education.

These two sets of problems are very different and call for very different responses, but the way that China is governed … is an absolute top-down, autocratic, macro way of doing things, and it's a one-solution-fits-everything, and very little attention is paid to whether China B can catch up with China A. ...

[What are your thoughts on where this might lead?]

Well, China is on a knife edge, and if we in the West are not aware of this, the leaders in Beijing are very much so, and this is their top concern. They know that the stability is very fragile. They know that there is a lot of the economic disparities. They know that they are resisting what society demands, which is more transparency, more freedom, more accountability from the government. And also they see that through the Internet, through the globalization of China, more and more of the true picture of China will emerge. …

[The separation of the country into A and B, First World and Third World -- do you think that is a deliberate policy or not?]

… [I]t's certainly a decision that was made rationally on the basis that it served a purpose, and the purpose that it served is you have an underclass here that is entirely pliable, given that they have no residency rights; for instance, they can't fight an abusive employer; they can't fight for unpaid wages; they can't go to the police to complain if they are robbed or anything. …

They are very much an underclass. As for education, there is a lot of shocking language in government official publications.… It's rulers deciding that one part of the population is worth less than the other, and certainly the emphasis in education is put on elite education, on the top universities to get the top student and to get the best elite that they can, but they're not so much concerned about providing basic education or the best education you can afford, and you can afford a lot of education when you have 10 percent GDP growth for the past 20 years. …

China's rise … can be good for the world, and can be good for its Chinese citizens. There is no doubt about it. It's not about containing or punishing China because China fails to live up to the standards of the Western world, but it is about not allowing vicious parts of the Chinese political system to claim that they act on the behalf of the Chinese population, because they are not. They are trying to survive and keep in power at the expense of their population, if needed.

At the moment, they have managed to create this so-called middle class, which is actually almost a plutocracy in Chinese terms, and so they have managed to consolidate their legitimacy and to do a lot of things that are expected from government. But ultimately it doesn't answer the basic question: What will be the impact of a China that is undemocratic, unpluralistic, that is profoundly suspicious of the Western world, that is profoundly aggravated, and that is nurturing nationalism -- and a form of extreme nationalism[?] …

John Pomfret
Beijing bureau chief for The Washington Post (1998-2003)

…I am optimistic, but you can say I have bought into China. I have married a Chinese woman, I have spent 10 years of my life there, so perhaps I have a weird perspective. You said something about the people who were participating in 1989 being middle class. I would say they really weren't the middle class. I would define the middle class as property owners, as stakeholders in a society. Those people who were marching did not have a stake in society because they didn't own property.

Perhaps you can accuse me of being a materialistic American, but now in China you have, for the first time since 1949, the creation of a middle class, of property owners. Across the country, at least 100 million people own their own apartments, for better or worse. That development -- of actual property holders, of stakeholders in society -- I think will have important influence on how China moves in the future. Already you have tenant associations fighting developers. You have that type of tension happening more and more. I think China is beginning to work out a lot of its issues quite slowly. But four days ago in Southern China, between 10 to 40 people were killed by the People's Army police. So we're having bloodshed again, and it is 2005, so who knows? That is one of the great things with China: We do not know what this dragon in the East is going to do.

Xiao Qiang
Director of the Berkeley China Internet Project at the University of California, Berkeley.

…[Is all of China benefiting from the economic growth plan?]

[There are] many aspects to answer that question. It is an economic question. The economic policy that China decided to take over in 1992 is based on attracting foreign investment and [utilizing] China's cheap labor, well-educated workforces, at the expense of environmental protection and laborers' rights, to quickly build up the manufacture [and] productions along the coast. …

… The Chinese Communist Party claims it's [working] on behalf of the workers' interest. Where are the workers? Where are the peasants today in China? They are in the bottom of society. … [They] have not been included in this economic model.

These are not a small number of people. We're talking about hundreds of millions of peasants, hundreds of millions of migrant workers. We're talking about hundreds of millions of the unemployed and other people in different walks of life. We're talking about the entire state education system, the medical insurances and other sort of basic social security for the people. Those systems have been torn apart by this all-out economic growth. … If Beijing developed, if Shanghai developed, if Guangdong has thousands and thousands of exports and fancy fashion shows, they are not benefiting the peasants and the state-run employer workers. …

The second aspect of this is the growing [amount] of social unrest -- the violent conflict, the direct protest and confrontations to authorities in the last number of years. At the end of last year, the Public Security Ministry declared the number of the demonstrations was 74,000 nationwide, but a year before was 50,000, and this number is increasing. …

Editor's Note: The figure for 2005 has risen further to 87,000 incidents.

What is your feeling about those fellow students [of your generation] who ... are very successful business people, prospering more in China than they might have done in the United States? What do you feel towards that generation?

The short answer is I want this generation to be successful, whether [in their] business or whether [in their] personal life or whether in their future political life. Many of those people [had] a genuine idealist vision of China in 1989, and later on, life went on. They may address that, they may change that, but still they are today a most important generation of China, because they are in their late 30s and early 40s, and they are truly taking over the society now. And there is a memory still there.

It is an undeniable fact that after the massacre, the Chinese authorities successfully co-opted the intellectual and business elite, convinced them of the story that only under the status quo of the Communist Party [can China] go on the path of economic development and build up the country. Everybody has to sort of work under that assumption. Do not ever challenge that.

If you want to succeed in today's China, that is [the] general environment that you operate with. So those who succeed economically and businesswise and social status in China, it's part of that co-opted story.…

Orville Schell
China specialist and dean of the Graduate School of Journalism at the University of California, Berkeley.

… In many ways these [economic] gaps are hauntingly reminiscent of what happened in the '30s under the Nationalists, the Kuomintang, when coastal China got rich and peasant China remained poor. And if you remember, what was the Chinese Communist revolution all about? It was about angry peasants. Now we seem to be circling back in a very haunting way, with all of these peasant uprisings and instances of insurrection and protest -- whether it is over environmental pollution, confiscation of land, corruption. … This is only to say that maybe what goes around comes around.

But … creating a disparity and a point of tension will not be too dangerous unless the economy as a whole begins to wobble. We know economies are always cyclical, so sooner or later, China has to be ready for that. Then, of course, when economies wobble, you have to start depending on other things -- the political system, legitimacy of the government, common shared values that keep people together, a sense of common purpose. Right now, all the Party has to go on is, one, economic growth, and, two, they can excite nationalism as a unifying force.…

But it's a hell of a high-wire act, and the price for having done that -- you know, a lot of economics [is] basically ignoring other aspects of life which I fundamentally believe human beings ultimately need. They need some spiritual meaning to life. They need some sense of values, idealism, hope, that transcends just getting wealthy. China now entered a period where, without quite knowing it, it has viewed the market as a kind of freedom, and indeed it is. But it also is a master; it has its imperatives. There are certain things the market likes and it doesn't like. …

Ultimately does society not need some way to express itself without the whole boiler becoming so pressurized with discontent? Today I'd have to say they've done a pretty good job. But of late, there have been some agents that have been catalyzing the situation in China that are quite alarming -- I mean, some 74,000 instances of unrest reported last year in China, up substantially from the year before. This is troubling. And I think it's very troubling to the leadership. What it says is that people are not finding adequate ways to seek redress of grievances, and that finally, that verity is one that you can't simply turn off by having a lot of Gucci luggage available for people.

… I do think that there are many hopeful things that are happening within China. The question that really needs to be asked is, is China a balanced society, and does it have a prospect of becoming a balanced society? Now some would say, you have to do one thing first, and then you do another. Deng Xiaoping said it's OK for some people to get rich first, implying the others would follow. Well, I'm not sure what the best way is to raise the sick man of Asia up, which China was deemed to be early on. As I say, we're looking to see whether this model of development works. …

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posted apr. 11, 2006

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