China: The Stable Precarious Society - Politics Forum.org | PoFo

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#13631839
Nominal response to viewtopic.php?f=34&t=127489. But the inconsistency between the length and authoritative tone of my post, and how little I actually know about China proper compared to some others in the thread, made me feel that this thread was an inappropriate contribution.

China isn't going anywhere anytime soon. The countryside is poor, but they are getting richer than they have been. The Chinese are good at enduring hardship. They did not rebel against the repressive hand of Mao, and there will be no revolution in the far more prosperous, far less nation that China is today. One of the values which the Chinese cleave to the most is the ability to chi ku; to endure what perhaps should not or cannot be endured.

Lawrence Solomon wrote:How did so many [three hundred million people] become so rich so quickly? For the most part, through corruption.

No. That's retarded. A third of the nation cannot become wealthy by extracting peasant wealth like the feudal landlords of old. What does contribute to Chinese wealth is an infrastructure network that has expanded a hundred-fold since the opening of China, massive capital expansion continual and consistent reinvestment of half their GDP in capital assets each and every year, the rise of township and village enterprises, entrepreneurship, market systems, and foreign investment, and the massive amounts of surplus labor extracted from migrants who work eighty to one hundred hours a week in factories, which is promptly reinvested. While corruption is rampant across China, corruption does not create wealth; it merely concentrates it, and corruption has been endemic to China in each and every one of it's four thousand years of history from the days of the early emperors on out. There is no denying that a staggering amount of wealth has been created in the last four decades.

China is far from a nice place for everyone. The most egregious cases of Chinese state repression are truly black parts that it wishes to hide from the world; prison and labor camps for dissidents, silenced environmental activists and muzzled minorities deemed a little too virulent for the harmonious society, and the impoverished AIDS villages that dot various parts of central China. Beyond these utterly marginalized people are a parade of Chinese with a million grievances; under-compensation of property requisitioned for official development, frustration with kickbacks and bribes necessary to keep operations running. But peasants have endured far worse in China than having one's newly increased property value denied them when it is purchased as common farmland, such as having all your property seized and then being sent to the countryside to endure humiliation and do backbreaking labor for years. And the factory owners taking advantage of China's newfound prosperity while greasing the wheels with bribe money are hardly the people who will lead a revolt against the state.

Who will spearhead the collapse of the state? The dying rural towns staffed mainly by the elderly and the children whose adolescents are working far afield to send money home? The migrant workers, who despite insane hours and low pay nevertheless draw in far more than they could ever have done working agriculturally? The relatively depoliticized - or even, god forbid, downright nationalist host of university students that China is cranking out? Dynamic entrepreneurs marshaling the migrant labor, fed up with having to pay off a government official here or a corrupt officer there? Who will they revolt against - the local Communist Party functionaries of which a great deal many citizens, urban and rural, are members of? The provincial governments who consistently make provincial plans and development strategies, who negotiate with the central state for resources for roads or electric and oversee the expansion of these networks? The central state itself?

There are certainly potential sources of mass unrest in Chinese society. One of the foremost is pollution; blackened rivers and pollution brought up by corrupt companies dodging official regulation. But there are outlets; the central party recognizes the explosive unrest that unchecked pollution can cause, and there is a state-sanctioned network of state, media, and environmental organization where people can take their grievances; little comfort it may offer, yet it is more than they have been able to do. Another, which might actually topple the state, is economic collapse that takes out the primary factor that keeps society afloat - promise of future economic growth under the current system is more attractive than an unstable, uncertain future where the state has collapsed. But look at how China weathered the most recent economic crisis as compared to the West; should exports actually collapse, the state will undoubtedly be in for a crisis the likes of which it has never seen before. But, unless the collapse we were looking at was one brought on by "pro-democracy" sanctions (yeah right), a revolution cannot restore exports.

The state recognizes this. There has been talk of restructuring China's economies to depend more on domestic consumption rather than merely export-led growth and to shift Chinese production towards the Chinese consumer market. Exports as a percentage of gross industrial output remain extremely high but has nevertheless been declining over time. In it's previous five-year plans, the state has emphasized coastal development at the cost of the environment; of interior development; of agricultural development; of social safety nets, in order to keep the economy growing at breakneck speed. But there has been an increasing recent emphasis on "moderate prosperity" and awareness that the state most tend to the social sphere, not merely the economic. China has a whole host of social problems to deal with. Political repression. Pollution. Corruption. Should these problems grow unchecked, certainly, the grievances of a billion people cannot be contained for long. But the state can take measures to correct them, not merely contain them, through concessions, through reforms, and where that fails, by attempting to smother the grievances in economic growth. So far it has been working.
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By HoniSoit
#13631972
TBD - I agree with your analysis which touches the heart of a lot of problems in China. I also agree that at least in the short run the party-state is going to survive. The potential sources of conflict are many but few - if any - of them are likely to grow into direct challenge to the party-state any time soon. But there are also other medium or long term sources of conflict that could seriously challenge the legitimacy of the regime.

The first is inflation, which is well-known reason that caused the protests of the late 1980s and has since been a serious concern for the party-state. I think what's been happening in the past few years is interesting and quite new since the economic reform in the 1980s. That is, you have huge concentration of money - fuelled by low interest rate and state-led loose banking lending in the past couple of year to stave off the worst effects of global financial crisis on China - that is looking for investment opportunities (in many ways, a situation not dissimilar to what has happened in the US for the past four decades). While in the 1980s and 1990s, most of the investment has gone into the real economy, the 2000s has witnessed overcapacity in the real economy and probably falling low rate of profit as well - which is not only the result of falling export but also small share of domestic consumption in GDP due to stagnating wage for workers and very slow wage growth for the middle class after adjusting to inflation (i.e. the share of wage and salary in national income has been declining in China). So it is not surprising that capital is moving away from investment in the real economy and looking for other avenues of investment - i.e. speculation. This has resulted first in the stock market bubble which burst with the global financial crisis, and then the real estate bubble that the party-state is finding difficult to manage at the moment. It appears that speculation has also played a part in the recent surge of food prices (not to ignore the rising food demand in China and rising food prices globally). So these things tend to cause inflation and quite a bit of popular discontent. It may come to a point where the party-state just cannot manage inflation anymore (witness, for example, its almost panicky increase of bank reserve ration and interest rates for several times in the past 12 months). And this could lead to urban protests, which may start on specific issues like surging food price but which could soon turn into a more general protest. It is impossible to predict but this remains a possibility.

The other source is a longer term issue to do with the privatisation of land. The party-state has been debating whether it should allow privatisation of land, or at least land use. Obviously, the expropriation of land by local state without proper compensation has already caused much rural unrest. I think if privatisation of land is sanctioned by the state some time down the road and villagers begin to sell off their land on a large scale, it would further push people off the land to cities for employment - which may by itself create or exacerbate urban unemployment. And if there is an economic stagnation or downturn - a distinct possibility if the party-state does not take radical measures to redistribute wealth to shore up domestic consumption, it would mean that these rural-to-urban workers cannot go back to their villages which could at least offer temporary shelter when they are unemployed - which is exactly what happened with the global financial crisis when tens of millions of workers were laid off and returned to their villages, which explains why we did not see a sudden great surge of labor protest as a direct result of the financial crisis. So this could be a longer term issue and source of conflict that is going to seriously challenge the party-state.

I find what's happening is China really fascinating - not least because the implication for my area of research, which is labor studies. There are so many facets and aspects to so many things. So hopefully we can have more posts like yours that seriously discuss them.

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