China's income gap widened in the first quarter of the year, with 10 percent of the nation's richest people enjoying 45 percent of the country's wealth, state press reports said. China's poorest 10 percent had only 1.4 percent of the nation's wealth, the Xinhua news agency reported, citing a recent survey by the National Bureau of Statistics. ...From the reports coming out of China about the riots, Pundita ventures that corruption shares the top of the list with rage about government-sponsored/tolerated thuggery meant to drive Chinese poor off their land. Perhaps Fan Gang's comment reveals an ulterior motive for Beijing's refusal to deal with Gangster Capitalism. Click on the Simon World link to access the rest of the China Daily story, which is worth the read.
In order to build a modern "well off" society, China hopes to attain an urbanization rate of 50 percent by 2020, which means finding jobs and living space in cities for hundreds of millions of people.
"The income gap issue will not become smaller in the next 10 years, but probably will increasingly widen," Fan Gang, a leading economist at the National Economic Research Institute of China told Xinhua. "When discussing the issue of income distribution, the thing that everyone hates most is corruption, this is unfair."
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Simon is on travel so I am delaying the last installment of the China dialogues until Monday or Tuesday. But we are still on the China page, thanks to Dave Schuler's response to yesterday's Clairol post.
Dear Pundita:
Your characterization of traditional Chinese society isn't quite accurate: there were parallel systems. Like much of the world every village had a village headman on the one hand and the central bureaucracy sent out their own representatives on the other.
Theoretically becoming one of these bureaucrats was a very egalitarian matter: any peasant's son who passed the civil service examination could become one. In practice (not unlike the SAT's here) the rich could hire tutors, etc., so it wasn't quite a meritocracy.
So there was a local semi-democratic government and a parallel highly centralized, hierarchical, and bureaucratic central government.
Dave Schuler in Chicago"
Dear Dave:
Thank you for the history lesson. Pundita's memory of Chinese dynasties is as about as clear as her memory of Indian, Persian and Egyptian ones. My clearest memory of dynastic histories is encapsulated in a Monty Python skit--I think it was Monty Python; British comedic dynasties also run together in my mind.
Anyhow, the skit showed Italian peasants just starting to harvest when Nazi tanks roll across the field, flattening the harvest. Cut to the same peasants starting on another harvest; the Allied tanks roll in from the opposite direction, flattening the harvest.
Civil service meritocracy, semi-democratic government -- that's the Ming Dynasty, isn't? Pundita always thinks of the Ming as the "1066" of Chinese history. Anyhow, there was a period in Chinese history of independent peasant landowners, which probably coincidences with the height of the situations you're talking about. But if peasants wrote the history of civilization, much of it would come down to the skit I recounted.
This said, your points are well taken. Yes, there were parallel systems, which waxed and waned according to events largely outside the control of peasants except when they got really ticked off and staged rebellions.
What we're seeing today in China is a growing rebellion among the rural peoples. This could spell bad news for the ruling party and foreign companies using China as a plantation.
Beijing hasn't released figures since 2003 on the number of yearly riots and with good reason; riots are breaking out all over the country. The 2003 figure was 58,000. That figure is surely a drop in the bucket next to what's going on today, which is a ruthless land grab that the peasants are increasingly fighting.
The story in China would be familiar to students of America's Robber Baron history phase. Corporations that want to build a plant and officials who want to clear land for government projects are using thuggery to eject the people from the land. The cops are paid not to intervene. So the people have no choice but to pick up arms. There's a lot of sympathy building in China for the ones who fight back, so Beijing is increasingly reluctant to punish the peasants who skirmish.
That puts Beijing in a bind. They want to continue bending over backward to accommodate foreign investors, but they're staring down the barrel of insurrection. Of course Dr Ayman al-Zawahiri and his kindred of kind are making hay from the situation in Muslim regions of China.
Al Qaeda isn't deterred by a million-man army. They pussyfoot around and stoke trouble then lay low, when the military comes near. So now Beijing is really in a pickle.
The US government keeps telling Beijing, "Introduce democracy," which is a valve for blowing off a huge head of steam. But Beijing is the Wise Man; they know it all. In their book there's nothing that sticking to Central Planning can't solve. So their way of dealing with snowballing unrest has been to attempt to put a lid on reality, in the manner of Elmer Fudd shooting at Bugs Bunny.
However, the lid has blown off (scroll down the Sudan Watch page to find the two reports, one of which I quote here):
BBC news reported on a rare video footage shown on UK Channel 4 news the previous night. The film was shot in China by a resident with a digital camera. It was then handed to a reporter from the Washington Post. ...Such land grabs are not limited to China; they are common in India, although they are (to my knowledge) no longer sponsored by the central government. They are common just about everywhere in the less developed countries where entitlement to land is not legally established. Indeed, that's why Pundita has viewed the Darfur democide with deep suspicion--as I came to view the shenanigans in the Ukraine election with suspicion.
The video footage showed a shocking riot in China not far from Beijing. To clear land and make way for a power plant, peasant farmers were set upon and beaten by a marauding gang of thugs hired by local officials to drive the farmers from land they had squatted on.
According to the BBC report from Beijing by Daniel Griffiths, the eviction of local people to make way for new developments is becoming one of China's sharpest social issues. Re the video, he said the pictures showed local farmers fighting a pitched battle with dozens of unknown men wearing camouflage gear and construction helmets. Hunting rifles and clubs were used in the bloody clashes in the northern village of Shenyou. Chinese state media said that the residents had been resisting the takeover of their property by an electricity company which wants to build a power plant there.
According to both reports, violent disputes like this one are common in China, where competition for useable land is fierce.
Granted it's no more than a suspicion but nine times out of ten, it seems, a land grab is at the bottom of many of today's conflicts. This would include much violent crime in underdeveloped countries where there's little or no history of property rights as we know them in the West.
When Westerners think of democracy they tend not to realize that they're thinking of a matrix of situations. This would include legal property rights, legal protection for contracts, and a judicial system for enforcing the legalities that is not run by bribes.
The IMF and the World Bank recognize this situation, but the recognition came late in the day. And it's come in piecemeal fashion. That's why I harp on the need for modeling and a systems approach to implementing democracy programs. Development planners get one piece of the puzzle; e.g., black markets vampire the economy. So far, so good. But if they institute reforms to cut out the black market without taking into consideration how black markets function as a system, you end up with a nightmare:
The little guy now has to pay taxes on top of the payoffs he made to mobsters during his black market business days. This is because there is no golden handshake, no pension, no social security for mobsters. If the black market vaporizes due to government fiat the gangsters aren't going to let their wife and kids starve.
Society is a complex interlocked system, if you will. Unless you study the matrix trying to alter one part of it by government fiat returns disaster. The attempts to solve problems in piecemeal fashion that flagrantly ignore other aspects of the matrix set in motion widescale social unrest. Then you see a wholesale rejection of democracy. This has been happening in 'Latin' America.
Beijing is up against another part of the matrix--well, all parts, really, but right now they're caught in a vise with regard to the land-clearing. On the one hand, they have to keep clearing land for industrial projects to keep up foreign investments and make China a favored destination for offshoring.
On the other hand, America's Robber Barons weren't operating in a time of portable nukes and megapopulations. Governments can no longer displace vast numbers of people and not expect a severe penalty, which can include the government toppling.
What's the way out of the vise? Trust that there's enough intelligence among the people to work out their own solutions in democratic fashion. Which returns us to the points you brought out. There have been times in China's history when more decision-making power resided among the peasants; those times have been marked by prosperity and relative peace. When Mao saw the Revolution had gone bad, he tried a disastrous means of bringing in a form of democracy; that cleared the path for the Mandarin types to gain control of China and consolidate power in Beijing. And here we are today.
People aren't stupid; they know that industrialization means the need for industry to have land, which equates to jobs, down the line. So what they will settle for is reasonably fair compensation of some kind.
However, rage is building among China's peasants against Western corporations. Beijing is trying to divert the rage by directing it at Japan but that's not going to work. Meanwhile, China's quest for energy is taking them into the same kind of situation that Western businesses are facing in underdeveloped countries. China's quest for gas and oil now makes them a big player in African countries, including Sudan and Chad. They just beat out a Canadian company for a concession there.
Indeed, if you scroll down the latest Sudan Watch list of all their current news items, you'll have a good idea of what's on the agenda for the G8 meeting at Gleneagles.
Note that George Soros is taking up the call for energy companies to be transparent. Why does that not surprise Pundita, now that Russian oil is back under control of the state?
Thus, the outline of the early 21st Century takes shape.
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