China's silent rural revolution

Jiang Wenran, Professor of Political Science, University of Alberta, Canada, Project Syndicate

When China's National People's Congress (NPC) concluded its annual meeting recently, it voted to enshrine protection of human rights and private property in the constitution. But other major changes in China's development strategies that appear to be taking place have attracted far less notice.

China's current leadership, one year after coming to power, has criticized "the single-minded pursuit of GDP growth" over the past decade and unveiled a new approach to modernization characterized as "balanced, human-centered, and environmentally friendly." The change in priorities -- and outsiders' tendency to overlook it -- is not difficult to understand.

The world is fascinated by China's economic miracle, but it is much less interested in the costs associated with the country's 8-9 percent annual growth rate in the past 25 years. For instance, the energy consumption of every unit of Chinese industrial output is close to three times the global average. In may places, the environment has been devastated almost beyond recovery.

Similarly, a recent Chinese bestseller, A Survey of Chinese Peasants, reveals the tremendous human costs of China's modernization drive. The book caught the attention of both the elites and the mass public with its heart-breaking stories of the suffering endured by 900 million farmers and its bold criticism of the government's rural policies.

Beyond the glamorous skyscrapers of Beijing, Shanghai, and other urban centers, the majority of Chinese who live in the countryside have gained little from the material progress of the past two decades. On the contrary, the initial benefits that peasants gained from the rural reforms of the late 1970s and early 1980s have disappeared; real income among farmers has dropped in recent years as their production costs rise and agricultural prices decline. In most parts of China, farming can no longer sustain a respectable standard of living.

Most worrying is the ever-growing tax burden placed on the rural population. While average agricultural income grew by 90 percent in the 1994-1997 period, the rural tax burden jumped by 800 percent. More than 300 taxes and fees have been imposed on peasants by all levels of government. For example, some townships demand 14 kinds of fees to register a marriage.

Today, a farmer's annual income is only one-sixth that of an urban dweller's, but he has to pay three times more in taxes. This comes in addition to many other financial burdens exacted at the local level. Indeed, 25 years of reforms have changed nothing of China's "one country with two systems" -- a model that segregates China's urban centers from its agricultural areas, with development of the former realized at the expense of the latter.

If we use what is called the "Gini coefficient" to measure this income gap, with "0" indicating perfect equality of income distribution and "1" meaning perfect inequality, the number for China is 0.454 in 2002. This is an internationally recognized level of "absolute disparity." India, long known for gross disparities between rich and poor, has a Gini coefficient that has hovered around 0.30 to 0.32 over the past five decades. So today's China is a much less equitable society than India.

A recent study by the Chinese Academy of Social Sciences concluded that China's urban-rural income gap is the worst on earth, maybe only slightly better than Zimbabwe. The irony here is that China is widely hailed as a success story, while Zimbabwe is generally viewed as a failed state.

Such an unfair distribution of wealth based on economic exploitation, social injustice and political exclusion has caused silent but persistent resistance by Chinese peasants. They protest, they petition, and they participate in local riots when all other means are exhausted.

Yet little changes. As a result, the "peasant question" is now threatening social stability and is potentially explosive in a way reminiscent of when Mao organized his revolution around peasant disaffection with the rural policies of the Nationalist government of Chiang Kai-shek.

In response, Premier Wen Jiabao announced a series of measures during the NPC, ranging from phasing out agricultural taxes over the next five years to measures aimed at increasing farmers' income. But while official attention to rural poverty is music to the ears of the poor, experience shows that such promises are usually inadequate. Wen's predecessor, Zhu Ronji, also said that his "biggest headache" was how to reduce the rural tax burden and increase peasant income. Yet the situation only worsened.

China's government must acknowledge that deep income inequality and rural poverty is no longer exclusively an economic problem, but threatens social peace and political stability. Comprehensive reform is the only way out. Unless China commits to greater political openness, allowing the poor and disadvantaged to voice their concerns, represent themselves, and monitor policy implementation, it will continue to be jeopardized by a false and perilous prosperity.

The writer grew up in China and spent five years on a farm in the early 1970s.