Friday, January 9, 2009

inequality and its enemies in Revolutionary andReformchina

inequality and its enemies in Revolutionary andReformchina
Ching Kwan Lee, Mark SeldenSocial inequality has been a core problem at the heart of sociological analysis since the birth of the social sciences.China’s recent development – from one of world’s mostegalitarian societies on the eve of reform in the 1970s to becom­ing, by 1995, one of the most unequal in Asia, and then, by theearly 2000s, in the world – and the rash of social protest that has accompanied these changes – has naturally spawned a bur­geoning literature documenting and assessing patterns of inequality (Zhou 2004; Li et al 2004; Lu 2002, Walder, Li and Treiman 2000; Xie and Hannum 1996; Bian 1994; Ravallion and Chen 2007; Khan and Riskin 2005; Wan 2008; Huang 2008).Increased accessibility both to official survey data and researchin local communities has allowed researchers to amass large and increasingly sophisticated data sets documenting income distri­bution, social mobility and structures of inequality. Workingwithin the “stratification paradigm”, these empirical studies haveovercome a major obstacle confronted by a previous generationof China scholars studying social inequality: the dearth of scien­tific data. The essays collected in James L Watson’s Class andSocial Stratification in Post-Revolution China, published as recently as 1984, mostly relied on the official press in theabsence of local, regional or national surveys. The most directaccess to Chinese society in the book involved “emigrant inter­views” conducted outside China. In less than 20 years, the socio­logical and economic literatures, including large­scale surveys and detailed ethnographies, like the realities they seek to explain,has been drastically transformed.Nevertheless, if the field has gained in data collection, preci­sion of measurement, sample size and statistical and ethno­graphic sophistication, the understanding of patterns and struc­tures of Chinese inequality confronts two major pitfalls thatsuperior data and techniques cannot resolve. There is yet toemerge a compelling institutional, or political economic, analysis of the defining characteristics and patterns of Chinese social rela­tions against which to gauge inequality. This has been true bothin China, throughout the epochs of revolution and reform, and internationally. Indeed, there remains disagreement on the veryterrain on which China’s most compelling inequalities rest. The“stratification paradigm” is concerned with explaining individual positions and movements across empty places in a social struc­ture of unequal income, occupational status, and life chances.Without a theory of social structure, and a methodology appro­priate to it, it is almost impossible to meaningfully measure andinterpret inequality (Burawoy 1977). Should one measure indi­vidual or household income or assets, access to medical service,During the epochs of revolution and reform in Chinaover the past six decades, under what conditions haveheightenedinequalityandperceptionsofinequalitytranslated into the discernment of inequity and thestimulustochallengetheorderperpetuatingit?The paper throws light on the key institutions andmechanismsunderlying,structuringandrestructuringpatternsofinequality,thechangingfeaturesofpopularresistancethatinequalityhasbred,and thecontestedmeaningsanddiscoursesofit.Ching Kwan Lee (CKLee@soc.ucla.edu), author of Against the Law:Labour Protests in China’s Rustbelt and Sunbelt (University of CaliforniaPress, 2007), is with the Sociology Department, University of California,Los Angeles, USA. Mark Selden (mark.selden@cornell.edu) is with theEast Asia Program, Cornell University and is a coordinator of The Asia-Pacific Journal: Japan Focus.
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china since 1978december 27, 2008EPWEconomic & Political Weekly28or access to education? How big an income gap is big? These areempirical questions with theoretical consequences. In examiningthe scores of articles and studies of Chinese inequality producedin Chinese and English in recent decades, we note the absolutepoverty of interpretive structural analysis, that is, analysis thatmoves from increasingly sophisticated weighing of the numbers to gauging their wide­ranging social and structural conse­quences. What is the nature of the contemporary class structureand its predecessor during the revolutionary epoch that followed from land reform? Indeed, is social class a useful vehicle forassessing social inequality in the People’s Republic of China(PRC), whether at the height of revolutionary mobilisation orduring the contemporary epoch of market and mobility and whatare the best indicators for clarifying class dynamics? How are weto define regions in order to best capture spatial disparity? Candidates that have been put forward for understanding spa­tial disparities include coastal and inland regions, mountain andlowland regions, city and countryside, intra­ and comparativeprovincial measures. Without any theoretical framework forgrasping social structure, survey data and statistical techniquesmay generate artefacts that clarify little of the underlying reali­ties. Moreover, the crude distinction between “market” and “redistribution” invoked by many stratification studies belies theinstitutional complexity as well as variation across time and localities in the past six decades. Obviously, the market in the“market economy” in the 1980s was very different from that of today; allowing getihu (peddlers) to purchase and sell goods is not the same as privatising vast state owned enterprises withownership and control passing to well­positioned cadres andtheir business allies; township and village enterprises, whetherof the collective or privately owned variety, differ in funda­mentals from international investors in factories employing tens of thousands of migrant workers, and so forth. These are but asample of the empirical questions that must be addressed in mov­ing towards a theoretical paradigm for understanding China’s social structure.The long dominant stratification paradigm also fails to shedlight on the historical meanings and political and moral centra­lity of inequality issues in the Chinese revolutionary and reformexperience. Using the currently hegemonic and ostensibly “neu­tral” language of social strata, return to human capital and mobi­lity obscures the fact that, in contrast to the United States orUnited Kingdom, class membership has frequently been a matterof life and death (as in the land revolution) and the product notmerely of social relations but of state­sanctioned categorisationwith legal and political implications. Class labels – here we referboth to social class origins (chengfen) and spatial class designa­tions (hukou) – have been constitutive elements defining not onlychanging economic and social positions but also political posi­tions and subjectivities in Chinese society from the revolutionaryepoch of the 1940s through the reforms of the 1980s to thepresent. Discourses of class, class exploitation, and class equalityand social justice were used to restructure society, as in land reform followed by rural cooperative formation and collectivisa­tion and, to some extent, in the processes leading to nationalisa­tion of industry. They also provided the language to legitimiseregime suppression of political dissent (as in the Hundred Flo­wers movement, Great Proletarian Cultural Revolution, and pro­democracy movements in 1978 and 1989, among others. Withsuppression of the language of social class and class strugglesince the 1980s, far from disappearing, social classes and otherclass designations have assumed new forms.The language of class and exploitation was deployed by rebel activists during the Cultural Revolution to challenge illegitimateofficial malfeasance and rally popular support to rebel banners.In recent years, comparable discourses have fuelled popular out­rage about income disparity, official corruption and collusionwith big business, drawing on revolutionary themes that manybelieved were long moribund. But rarely have the contemporaryissues been framed in class terms. Recently, the stratificationparadigm, promoted by sociologists at the Chinese Academy of Social Sciences, has fallen prey to the regime’s project to individ­ualise, depoliticise and rationalise the patterns of inequality thatare the product of “marketisation”, including the sale of stateindustrial assets, the sale of land, the elimination of welfare and health benefits associated with the former state regime. These,and issues associated with official corruption, all of which havesparked popular resistance, have pressured the regime to formu­late official responses that promise rectification of all of the pat­terns of inequality associated with these and other abuses, evenas they direct popular anger away from the streets and towardsthe law and the courts. We inquire into the conditions underwhich heightened inequality and perception of inequality may betranslated into the perception of inequity and the stimulus tochallenge the order which perpetuates it at the expense of thepoorest and most dispossessed.The fact of the matter is that neither the successive “class lines”of the revolutionary period nor the stratification paradigm of thereform era resulted in a compelling structural analysis of post­revolutionary society. In the revolutionary era that we may datefrom land reform in the years 1947­52 to the mid­1970s, class analysis pivoted on chengfen or class origin and obfuscated thesocial structure and relations defining wealth and power in thePeople’s Republic. Likewise, subsequent stratification models since the mid­1970s drew attention away from structural verities,in particular, from the intersections of official power and privatewealth that have shaped Chinese society down to the present. Itis precisely such structural analyses that are critical if analysis of issues of income distribution and other determinants of inequa­lity are to illuminate the social order or open the way to a moreequitable society.In short, we need to be reflexive of the ways “inequality” is socially and politically constructed as well as morally and emo­tively apprehended. Elsewhere, sociologists studying inequalityin Latin America have similarly found the language of social stratification inadequate for capturing the multivalent dynamics of complex societies. In that “lop­sided continent”, characterised by glaring polarisation of wealth, a substantial informal pro­letariat, pervasive breakdown of public order and violence of everyday life, conventional stratification categories, with theirassumption of hidden and non­violent power, fail to convey“an inequality that can only be understood through a constant
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china since 1978Economic & Political WeeklyEPWdecember 27, 200829and daily reinforced flow of blood” (Hoffman and Centeno2003: 373).In this brief paper, we can only sketch the broad contours of what we consider a more reflexive perspective that illuminates:(1) the key institutions and mechanisms underlying, structuringand restructuring patterns of inequality over the past six dec­ades; (2) the changing features of popular resistance that consti­tute the most important responses to inequalities and injustices;(3) the contested meanings and discourses of inequality duringthe two epochs that we call revolution and reform. Some of thesethemes can be found scattered in the China literature. We seek tosynthesise them into a more coherent framework that can illumi­nate both changing structures and social movements.We take inequality to mean unequal distribution of income,wealth, life chances and basic needs entitlements. Section 1 traces the evolution of three durable hierarchies producing inequalityin Chinese society – class, citizenship and locality – whose mech­anisms and interplay have been in flux across time and spacesince the 1940s. Section 2 turns to the changing modes of thepolitics of inequality. We argue that large­scale, party­initiated mass mobilisations on a national scale have yielded to more loca­lised and fragmented patterns of state intervention and socialprotest initiated from below. In Section 3, we note the changingacademic, political and popular constructions of inequality and justice, particularly the muting of class rhetoric and subjectivitiesand their replacement by a discourse of efficiency, legal rights,citizenship and stratification.1 class,spatialhierarchiesandcitizenshipRightsThe revolutionary processes of land reform and collectivisationtransformed and homogenised the complex social structure ofpre­revolutionary rural China. On the one hand, land reformeliminated property­based income inequality, giving rise to ahighly egalitarian intra­village income distribution. On the other,a two­tier structure of collectivised villagers and cadres emerged in the course of land reform and collectivisation with the latterexercising a monopoly on political power. In the formal structureof the revolutionary period, class origin (chengfen) was fixed bybirth, on the basis of purported position in the pre­land reformsocial landscape. The result was to create a frozen set of catego­ries in which landlords and rich peasants, long since stripped ofthe property and wealth that once defined their class position,constituted a new social stratum at the lowest echelons of thecollective order. In this “transvaluation” of values, these so­called“class” enemies and others stigmatised as “bad elements” wouldbe repeatedly made the scapegoat and attacked in political cam­paigns. The various labels concealed the fact that inequality wasno longer founded on property ownership or market outcomes,but was a political category with economic and social conse­quences enforced by the state and reinforced by mass mobilisa­tion politics at the grass roots. Stated differently, the party com­mitted to class revolution deliberately concealed and obfuscated the primary class relations of the post­land reform political sys­tem through its imposition of chengfen categories. In this sense, aregime emerged in China’s countryside predicated on high levels of intra­village income and ownership equality but presiding overan order characterised by unequal citizenship with state­distributedentitlements to social groups differentiated on the basis of theirpolitical loyalty and class­defined positions. In this system, intra­village income differentials were primarily determined by house­hold labour power, with little reference to land or propertyownership. We consider below subsequent differentiations ofcitizenship rights.The party spearheaded a parallel drive, but one that involved less popular mobilisation, to transform the urban class structurethrough the expropriation of merchants and capitalists and thesocialisation of industry in the form of state and collective own­ership and management of industry and commerce. In the wake of socialisation, permanent workers in state­owned enterprises(SOEs) gained lifetime employment and a welfare package thatincluded healthcare, housing, and generous retirement benefits.Significant income, benefit and status differentials remainedwithin worker ranks. Only workers in core (mainly large) SOEs obtained the “big” welfare package that provided lifetimeemployment, free healthcare for family members and manyamenities such as generous retirement benefits, benefits unavail­able to workers in smaller state enterprises and urban collectiveenterprises. Nevertheless, nationalisation of industry, like rural collectivisation, produced substantial homogeneity of incomeand consumption in China’s cities as property­based differentialsvirtually disappeared.The deepest social divide in the cities was not within the ranks of workers but, as in the countryside, it was between workers andcadres and was mediated by a graded pay scale based on theSoviet model. The result was somewhat larger yet still modestincome differentials compared with those found in the country­side. Cadres monopolised political power, and they had access toscarce resources such as special shops, and services availableonly to the most privileged workers. In sum, then, inequality inrevolutionary China hinged neither on differential ownership of the means of production nor on substantial difference in wealth,but on differential access to power and privilege mediated through the party state, which controlled both collectives andSOEs and through them the labour and remuneration of workingpeople in both rural and urban China. Stated differently, in revo­lutionary China we find the rise of a party­dominated bureau­cratic class (Djilas 1957; Konrad and Szelenyi 1979; Friedman,Pickowicz and Selden 1991 and 2005) with power based on posi­tions in the state and collective hierarchies and its ability to con­trol urban access, rather than on private ownership of the means of production.Another state institution has structured inequality in the formof rural­urban hierarchy, producing what in essence is an unequalcitizenship regime. In 1960, when the Great Leap Forward failed,propelling China into famine, the party tightened the populationregistration (hukou) system that had begun to take shape in 1955,erecting a great wall between city and countryside, locking ruralpeople into their villages and cutting off most remaining intra­rural and urban­rural exchanges that were not sanctioned and controlled by the state. The state also continued to siphon off therural surplus to urban industry primarily via compulsory grainsales at state­imposed low prices and secondarily through
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china since 1978december 27, 2008EPWEconomic & Political Weekly30taxation, a mechanism central to industrialisation in the earlydecades of the PRC (Cheng and Selden 1994; Fei­ling Wang 2005).To be sure, urban wages were set low, but the combination of cash incomes (rural people mainly earned income in kind),lifetime employment, pensions and healthcare (provided bythe state for urban workers and employees only), the subsi­dised ration system, and superior schools, all worked to thedecisive advantage of urban workers and employees. The resultwas a formal two­track system differentiating city and coun­tryside, state sector and collective enterprises with hukou as themediating institution.The significance of the urban­rural divide is driven home withparticular clarity by two sets of facts. First, nearly all of the mil­lions who starved to death during the Great Leap famine – thedata and their explanation remain elusive and the figures con­tested, but the most credible estimates range from 10 to morethan 20 million extra deaths – were rural people. (Riskin 1998poses critical methodological questions about the scale andexplanation of deaths, but the fact that the countryside bore thebrunt of hardship is not in doubt.) In the face of severe nation­wide famine, the state protected urban residents from starvation.Viewing city and countryside as a whole, urban per capita grainconsumption dipped slightly, from 201 kg per person in 1959 toan average of 187 kg in the years 1960­63, before returning toprevious levels. By contrast, rural grain consumption plummeted from 201 kg per person in 1958 to just 168 kg in the years 1960­63and did not return to 1958 levels until 1979 (Taylor and Hardee1986). Second, in 1961 the state “sent down” (xiaxiang) 20 mil­lion urban workers, thereby shifting its burden of feeding andproviding work for them in famine times to a countryside thatalready had a large labour surplus and confronted acute hunger.This first wave of “sent down” urban denizens would be followedby the dispatch to rural areas of close to 20 million urban juniorhigh and high school graduates in the years between 1964 and 1976, ostensibly to bridge the urban­rural gap through their con­tributions as farmers to rural development, but in fact, relievingthe state of the obligation to provide jobs and benefits for them.To be sent down was to lose (in most cases permanently) the lar­gesse of the state (Friedman, Pickowicz and Selden 2005).Yet, we want to emphasise two points in reflecting on spatial patterns of inequality. First, the duality of rural­urban hierarchyin practice functioned more like a spectrum, extending frommetropolitan cities, to suburbia, to smaller cities including countyand township seats, to remote villages in interior provinces withschooling opportunities, healthcare programmes and food rationing entitlements varying not only with urban and rural designation but also with specific positions within each categoryduring the revolutionary epoch. Relaxation of certain hukourestrictions since the 1980s has made possible the flood of migrantlabourers into Chinese cities but without eliminating the second class citizenship and stigma on rural residents, including thosewho have lived and worked in cities for decades. Even in today’s cities, access to education for migrants’ children, housing subsi­dies helping employees to purchase their own homes, and evenvoting rights still hinge on having a local urban hukou (Chan and Zhang 1999; Li 2006; Wu 2006). Second, while the unequal citizenship regime has existed since 1960, it has only been in thereform period since the 1970s that the implications of the widedisparities between rural and urban residents have been widelyrecognised in terms of discriminatory citizenship practices. Thisgrowing awareness is largely due to the palpable presence of a120 million­strong liminal group, “migrant peasant workers”(nongmingong), in and around Chinese cities, and the blatant, attimes even fatal, abuse sustained by migrants as a result of thehukou system. The death of Sun Zhigang in 2003 and the publicoutcry against discrimination of these second class citizens led the state council to abolish the regulation on detention and deportation, yet the legal system continues to discriminateagainst those lacking urban hukou. The combination of increas­ing income differential and conspicuous consumption during thereform era has made discrimination against rural residents andurban migrants palpable and blatant at a time when the Chinesestate has retreated from direct responsibility for guaranteeingsubsistence and welfare in favour of a market­centred approach.Reform of the hukou system and the emergence of a vastmigrant population since the 1980s throw into sharp relief themix of new and old mechanisms producing inequality in thereform period. If inequalities in the revolutionary period werelargely products of state mobilisation and enforcement carriedout under conditions in which domestic markets and interfacewith the world economy were tightly controlled, then the reformperiod is notable for the growing salience of domestic and globalcapital in restructuring inequalities and for adjustment in thepolitical style of the party contingent on a shift in emphasis frommobilisation to the market, with new opportunities for translat­ing political position into wealth. Thanks to persistent political monopoly, party officials are well placed to “commodify” theirbureaucratic position in the market economy, exacerbating theincome and asset gap between cadres and citizens. The result is that class relations, rooted in ownership of property, money and various means of production have returned and have becomesharply polarised and visible not only in the forms of ownershipand authority relations, but also in income and benefit hierar­chies and even citizenship rights (On new patterns of intra­ruralinequality see Zhou, Han and Harrell 2008). The transformationin citizenship regime is immensely complex. While social benefits have been drastically reduced for all, including former collectivefarmers and especially state sector workers, certain civil rights,including the right to work, sign contracts, and possess prop­erty, which have recourse to legal justice, and geographical mobility, have all increased. We discuss each of thesedimensions briefly.The post­collective rural order pivoted on the combination of the household responsibility system in agriculture, that is, house­hold farming based on contracts on land distributed equally tohouseholds on a per capita basis, and the expansion of rural industry and markets. Rural per capita income more than dou­bled between 1978 and 1984, and real rural per capita consump­tion increased by 51% between 1978 and 1983. The ratio of urbanto rural per capita income, by one informed estimate, fell from2.37 in 1978 to 1.7 in 1983 (Khan and Riskin 2001: 4). This impres­sive improvement was the result not only of higher agricultural
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china since 1978Economic & Political WeeklyEPWdecember 27, 200831output, but also of labour productivity gains, favourable purchas­ing prices, and flourishing rural entrepreneurship in industryand commerce, and taking the form of both collective and privateenterprises. Based on previously unexplored Ministry of Agricul­ture, bank and taxation data, Yasheng Huang (2008) has revealed a golden decade of rural entrepreneurship in the1980s, fuelled by a veritable financial revolution in the country­side and centred in particular in poorer localities. The statecouncil encouraged rural credit cooperatives to source deposits,compete and lend across regions, authorising loans to villagers inindustrial and commercial businesses that were the descendentsof the former communes.If Huang slights the collective origins of the early township andvillage enterprises (TVEs) and their contribution to rural incomegains in the years 1978­89, he rightly recognises the growing pri­vatisation of TVEs and of autonomous private and joint enter­prises in the course of the decade. The result was phenomenal growth of township and village enterprises, the absolute majorityof which were private, with almost all new entrants being pri­vate. Among 12 million or so TVEs in the mid­1980s, 10 millionwere private. According to Huang, this decade of virtuous, entre­preneurial capitalism benefiting the poor, including many in thepoorest regions of rural China, came to an end with the Tianan­men crackdown of 1989, spearheaded by leaders with strongcareer roots in major cities and SOEs. Rural political and fiscal management was centralised and private sector access to capital to engage in non­farm activities became very difficult to access.What Huang styles as China’s “commanding­heights capitalism”in the 1990s was state­led, biased towards urban areas, foreigncapital and the official elite, corruption­ridden, and detrimentalto rural interests in myriad ways including skyrocketing ruralilliteracy and the decline of rural health services. “GDP growth inthe 1990s increasingly was disconnected from the welfare of Chi­nese citizens. Surveys revealed that the ratio of household incomeper capita – relative to GDP per capita – declined continuouslyduring the decade” (Huang 2008: 173).While Huang rightly notes the relative decline of the country­side vis­à­vis the cities in the booming 1990s, we emphasiseregional patterns of differentiation within rural China and otherforms of spatial inequality. Since the mid­1980s, fiscal decentrali­sation has spawned growing income disparities between industr­ialised and more prosperous rural areas on the one hand, and poorer predominantly agricultural rural areas on the other. Inthe simplest terms, the route out of the most extreme poverty formost rural people since the 1970s has been and remains contin­gent on obtaining non­agricultural employment for one or morefamily members. Despite the gains associated with expanded non­agricultural employment of the early reform period, otherfactors have worked to the detriment of villagers. In interiorregions in particular, decentralisation weakened control by thecentre over local cadres who no longer fear anti­corruption cam­paigns. The lack of political accountability and lack of marketopportunity as the state slashed loans to private entrepreneurs inrural backwaters aggravated the burden on villagers in inland areas, even as the central government attempted to halt illegal levies and reduce agricultural taxes. By contrast, in enterprisingcoastal areas, rural industries draw on the entrepreneurship of local officials, forming “developmental communities” whichprospered on a formidable alliance of local officials, foreign anddomestic capital, and access to unlimited supplies of migrantlabour on a scale exceeding even that anticipated by economictheorist Arthur Lewis (Zweig 2002; Friedman, Pickowicz and Selden 2005). The central government in the years 2004­06eliminated the state agricultural tax and transferred additional funds to compensate local areas for the lost revenues (Lin, Taoand Liu 2006: 20­26). It remains to be seen, however, whetherthis will prevent the exaction of heavy illegal fees on villagers,particularly in poorer localities which have little benefited fromthe boom experienced in coastal and other core areas and whichhave largely been cut off from bank loans.Since the late 1980s, a new round of accumulation has beendriven by the combination of domestic and global capital, and byan alliance of officials and private capital. Our attention focuses on the second class status of the approximately 200 millionmigrants living and working in the cities, but with rural household registrations, who remain locked into an exploitative “bonded laboursystem” (Chan 2000). Its features include the frequent non­payment of wages and the paucity of benefits, both facilitated bythe marginal legal status of migrants. While significant numbers of rural workers have made income gains through employment incoastal and urban industry, the rural­urban dualism tends to holddown wage levels and maintain a subordinated labour force thatis without union representation and with few rights or benefits.At the same time, privatisation by stages and widespread bank­ruptcy of state­owned enterprises in the 1990s led to devastatingsetbacks including the loss of lifetime employment and benefitsfor state sector workers, long the heart of the industrial sector.The numbers of laid off workers in different types of unemploy­ment, given euphemistic names like waiting for work, earlyretirement, and taking long vacations, quietly grew in the early1990s. It then leaped from 3 million in 1993 to a cumulative total of 25 million by the end of 2001, with internal sources giving fig­ures as high as 60 million (Solinger 2005). By 2002, a new class of urban poor had emerged, estimated to be about 15­31 million,or 4­8% of the urban population (Tang 2003­4). Chinese officialstatistics placed the number of registered unemployed in cities at8.35 million in October, 2008, a 4% unemployment rate, on theeve of the world economic downturn (AsiaNews 2008).Privatisation of SOEs has simultaneously produced both theurban poor and the new rich while transforming the character of the cadre elite. Taking advantage of their effective control overthe assets of SOEs and ambiguities in the reform measures, sincethe 1990s, managers and local officials have illicitly transferredpublic property into their own hands on a massive scale (Qian1996). In this way, responsibility for loss­making state enterprises was placed on the shoulders of the workers while leading cadres enjoyed the opportunity to seize control of factories at bargainbasement prices and lay off their employees, formerly extolled as“the leading class”. In the process of “commodifying”, privatisingand frequently embezzling state assets, foreign direct investment(FDI) plays a pivotal role. From 1979 to 2002, $446 billion in uti­lised FDI made China the second largest recipient of FDI behind
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china since 1978december 27, 2008EPWEconomic & Political Weekly32only the US, a position it would consolidate in subsequent years.In 2007, FDI increased by 14% to $82.7 billion (Jiang 2008). Thesewere not simply capital infusions. In 1999, for example, 60% of China’s FDI inflows took the form of mergers and acquisitions(M&A) (Gu 1999).The “commodification” of urban and suburban land use rights has provided particularly fertile ground for the growth of the newbureaucratic­business elite. Urban land is totally “state­owned”, orowned by government administrative or economic units. In thereform period, however, China’s “socialist land masters” beganestablishing development companies. Selling land use rights tocommercial developers and largely bypassing the villagers whotilled the land, they reaped huge fortunes (Hsing 2006). The lossof state assets through illicit land use transfers since the late 1980shas been estimated in the range of 10 billion yuan per year.Between 1999 and 2002, documented illegal land sales totalled 550,000 cases involving 1.2 billion square metres of urban land (Sun 2004: 36). Indeed, this is the land counterpart to the privati­sation of SOEs, in each case the public assets being transferred intothe hands of well­positioned cadres at the expense of villagers andworkers who were left with token payment.In its high speed growth since the late 1970s, China has gene­rated substantial income gains that have been shared across cityand countryside extending to most villagers and urban workers,officials, and investors. At the same time the gains have beenhighly skewed, with major losers including formerly protected workers in state industry and large segments of the peasantry.We have attempted to sketch some of the ways in which incomedifferentials are rooted in fundamental class differences and incity­countryside differences that have restructured parametersof social, economic and political life and extended to core rights of citizenship during the reform era. New forms of income­and property­based inequality have re­emerged with the dismantlingof collectives, privatisation of state enterprises, the triumph of market mechanisms, the end of lifetime employment in cities,and the growth of corruption at the interface of government and business. The persistence of egalitarian land distribution remains the last bulwark for rural security, but it too is under stress, withland seizure by officials becoming common, notably in suburbanand urban areas where the potential for enormous profit exists,and with 2008 legislation easing the sale of household plots potentially easing the stripping of rural people of land rights.Citizenship continues to be conditioned by city­countryside divi­sions, with citizenship rights centred in and differentiated byhukou locations. Cadre privileges have been greatly augmented in the reform era as bureaucratic­business alliances in manyguises hold the keys to wealth and power in both city and coun­tryside, resulting in exacerbating in new ways perhaps the mostimportant gulf in social inequality in contemporary China.2 PoliticsofinequalityAmong the weaknesses of the stratification paradigm whenapplied to China is its obliteration of the deeply political implica­tions of inequality through reduction of the issues to income dif­ferentials. But issues of equality and justice have always been thespringboard both for regime mobilisation and popular resistancein both the revolutionary and reform eras. In this section, weunderscore several features of this politics of inequality. First,while the party has repeatedly used the eradication of inequalityas a means to consolidate political control over society, the proc­ess of mass mobilisation in the name of equality and justice had real effects in transforming not only structures of inequality but also people’s social consciousness and standards of justice, aboveall in a land reform programme that tapped deep social discon­tents. Second, the persistence of certain old forms of inequality,and above all the creation of new patterns of socialist inequality,has provoked societal resistance. This has frequently directedagainst local representatives of the party­state, with demands forequality and justice inspired in part by revolutionary ideology.Third, the scale and pattern of social activism in response to ine­quality have evolved through the revolutionary era to the reformera, with new targets emerging in response to changes in classstructure and the nature of the party state. Fourth, the party has always deflected attention away from structured inequalities,particularly those associated with social class, for which its ownpolicies bear responsibility. We illustrated this earlier with its useboth of chengfen (class origin) and its call to class struggle asmeans of ordering society in ways that distracted from aware­ness of actual existing class and spatial inequalities.The communist revolution from the beginning proclaimed theelimination of class inequality among its historical missions.Despite the elimination of property­based “classes” in the years 1947­56, notably in land revolution, class struggle subsequentlycame to be employed in ways that obfuscated existing class rela­tions. Thereafter, the party repeatedly brandished class catego­ries to attack the old bourgeoisie and landlords, losers of the civilwar who had long since been deprived of wealth, power and pres­tige. Maoists warned against the emergence of newly privilegedgroups within the party, but this was a conception largely devoidof analysis of social structure that became a tool of officials eagerto obscure the existence of a privileged stratum (Kraus 1977).Deprived of an objective basis rooted in property or privilege,class designation and the content of class conflicts were reduced to political struggles among factions and individuals. Inherited family background, political virtue and behaviour, allegiance tocertain policy lines were invoked to define classification as revo­lutionary or reactionary elements, good or bad classes, the ene­mies or the people.The China scholarship has documented the many campaignsled by the party to eradicate exploiting classes in city and coun­tryside (Hinton 1966; Schurmann 1968; Selden 1979; Friedman,Pickowicz and Selden 1991; Unger 2007). Notorious for their vio­lence, these campaigns were predicated on mass mobilisation ofthe entire population. Jonathan Unger (1984: 130), for instance,has noted of village campaigns that “not just the village cadres and young political activists participated but also, voluntarily,the bulk of the unambitious ordinary peasants. They believed in the strict class distinctions and in the legitimacy of class anta­gonism. The party has provided the good­class peasantry with acomplex set of emotional justifications and material reasons fordiscriminating against the bad­class households” (emphasisoriginal). While the question of “voluntary” participation under
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china since 1978Economic & Political WeeklyEPWdecember 27, 200833conditions of political mobilisation is at best moot, there is abun­dant evidence of active participation. Other scholars (Perry 2000;Friedman, Pickowicz and Selden 1991 and 2005) have similarlyunderscored the emotional catharsis involved in staged publicritual of “speaking bitterness”, which effectively forged emo­tional identification among villagers with the communist regimewhile imbuing the former wretched of the earth with a new senseof pride and purpose. The political agency of the “revolutionarymasses”, who were asked to turn their suffering and subordina­tion into power and responsibility for charting a better futureunder the leadership of the Chinese Communist Party, would later be eroded by leadership failures paving the way for nation­wide famine during the Great Leap Forward and cadre corrup­tion thereafter. In the predominantly urban­based movements ofthe Cultural Revolution among high school and university stu­dents, intellectuals and workers, activism from below created waves of struggle framed in the image of Mao and revolution,initially challenging the party to hew to its own principles, butsubsequently reifying party authority and producing no material gains for poorer strata. And even decades after Mao’s death and with the party invoking a reform agenda, workers in the mas­sive labour protests that erupted in China’s north­eastern rust­belt since the 1990s still invoke the claims of “masses” and rev­olution (Lee 2007).The gap between the ideology of and aspiration towards socia­list equality and the reality of entrenched societal inequalitieshas been at the centre of generations of popular resistance thatbegan in the revolutionary era and extended beyond it to thepresent. In the cities, in the mid­1950s following the nationalisa­tion of industry and commerce, more than 10,000 strikes erupted across the country, by far the most important taking place inShanghai, China’s industrial, financial and working class capital and the historic centre of the labour movement. In Shanghai in1957, strikes at 587 enterprises involved 30,000 workers (Perry1994). Since the 1990s, workers displaced or disadvantaged bynationalisation have been at the forefront of a strike wave decry­ing “bureaucratism” of cadres in the form of a vast increase in thenumber and power of managerial personnel following nationali­sation, and demanding the recovery of wages and benefits cutduring nationalisation (Lee 2003, 2007).The sternest test of revolutionary leadership would come dur­ing the Cultural Revolution. The nationwide social movements that “crescendoed” and exploded violently during the Cultural Revolution originated, and may have had their most far­reachingimpact, in the cities. While driven in part by national agendas choreographed by Mao and other party and military leaders, andby political struggles at the centre, in both city and countryside,rebellion was also spurred by popular grievances stemming frominequities born of policies and priorities associated with the revo­lutionary regime. In the initial stage of the Cultural Revolution,protests in schools and in factories usually began as a mobilisa­tion among students and permanent state workers with “good”class backgrounds (workers, poor peasants) and ties to the incum­bent party leadership hewing to loyalist positions, while thosewith weaker ties to the party or with vulnerable class backgrounds were yet again subjected to attack. Soon, however, students ofcompromised class backgrounds (landlords, capitalists and thosewho had been labelled as rightists or who had historical associa­tions with the Guomindang or secret societies), as well as disad­vantaged workers (temporary and contract workers), organised rebel red guard units and attacked the incumbent leadership.Illustrative of a level of militancy distinctive of that era were thenational and regional organisations of temporary and contractworkers that emerged in 1966 to demand the rights, benefits andsecurity of permanent workers only to be crushed after receivingbrief encouragement from Jiang Qing, Mao’s wife (Walder 1996;Perry and Li 1997). Perhaps no movement since land reform wasso explicitly organised on principles that challenged class ine­quality and class privilege.In the countryside, behind banners proclaiming class struggleoften lurked long­standing hostilities among families, villages and lineages over water rights, ancestral tombs, land or timberrights. Under the banner of the Cultural Revolution, cloaked inMaoist rhetoric, ancient and recent conflicts and inequalities could give rise to violence and vendettas within and betweencommunities. Village officials who were victimised by previous political campaigns saw in the Cultural Revolution an opportu­nity to take revenge and regain power, while incumbent leaderssought to direct popular struggles against helpless bad class households and to link up with local and higher allies in factional competition (Unger 2002; Friedman, Pickowicz and Selden2005). In the end, the Cultural Revolution did little to address thefundamental inequities of power, opportunity and income in cityand countryside or between city and countryside. Rather, aftermoving to the verge of civil war in 1966­68, Mao and the partyended the mass movements in a wave of state violence in theCleansing of Class Ranks Campaign of summer 1968 and subse­quent movements associated with re­imposing the power of theparty and army through revolutionary committees (Unger 2007;Friedman, Pickowicz and Selden 2005). The grievances associated with corruption and structural inequalities went unaddressed.The reform agenda, notably the “commodification” of land andlabour, the elimination of collectives and communes, and enter­prise privatisation as well as the growth of an indigenous privatesector, but also international investment and export­oriented development, simultaneously stimulated economic growth and threatened the livelihoods and security of segments of the rural and urban working classes. Thanks to the central government’s promotion of legal reform, the rhetorical flourishing of “rulingthe country according to the law” (yifa zhiguo) and fiscal decen­tralisation, popular resistance has frequently taken the form of legal activism and localised protest at the level of village or fac­tory. The regime has tolerated and sought to mediate these pro­tests, while acting to pre­empt the possibility for cross­localitylateral mobilisation characteristic of the revolutionary period.Until about 2000, the major grievances prompting mass actionby villagers were “burdens”, including taxes, levies, extraction of funds (for building schools or roads), penalties (e g, fines forexceeding birth quotas), and compulsory assessments. By theearly 2000s, land expropriation had become an additional incendiary issue in many provinces (Ho 2005: 16). Rural rebe­llions frequently begin when villagers acquire details of the laws
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china since 1978december 27, 2008EPWEconomic & Political Weekly34and regulations bearing on their interests and rights. When localcadres violate these policies, villagers write complaint letters,visit higher officials, expose local violations of central policies inthe media, mobilise fellow villagers to withhold payment of ille­gal and arbitrary fees and taxes, and challenge such abuses asland theft. Confrontations between resisters and local cadres have resulted in protracted court battles and in small­ and large­scale riots some of which provoke violent crackdowns by local and provincial governments. The great majority of protests arelocal struggles in a single village, even though there are occa­sional reports on activists building networks across villages, evencounties (Bernstein and Lu 2003; O’Brien and Li 2006; Yu 2003).In the cities since the 1990s, reform of SOEs, bankruptcies, massive unemployment, and labour rights violations in global factories employing migrant workers have triggered a rising tideof labour activism. Grievances of workers in both the state and private sectors, and involving both urban residents and migrants,focus mainly on an array of economic and livelihood problems,notably unpaid pensions and wages, layoffs, inadequate sever­ance compensation, arrears of medical reimbursement, and non­payment of heating subsidies. Targets of worker grievances havebeen enterprise management and local governments. In numer­ous cases involving bankruptcies and privatisation, workers voiceopposition to official corruption and illicit transfer of state assets.In contrast to the large­scale horizontal bonds formed by work­ers, students and villagers during the Cultural Revolution, themode of organisation in contemporary labour protests is one of“cellular mobilisation”. Most urban protests are based on singlework units or subgroups within those units, and rarely achievelateral organisation across factories, industries, neighbourhoods,cities or beyond. In a few exceptional instances workers veered away from cellular mobilisation, displaying a capacity forbroader class­based activism. Yet, once arrests of worker repre­sentatives from one factory occurred, popular support quicklycollapsed (Lee 2007). Above all, once mobilisation extendsbeyond a single community or enterprise, the state steps inquickly to crush the movement.Faced with mounting resistance, the central government has sometimes allocated emergency funds to localities with social insurance deficits and sought to ensure more effective social pooling. Similarly, in the countryside, Beijing has issued edictsprotective of the peasantry. The PRC Agricultural Law of 1993gave farmers the right to refuse payment of improperly autho­rised fees and fines, and stipulated a 5% cap on income tax. In2000, the centre inaugurated the tax for fee policy that aims toeliminate all fee exactions and retain only a unified agriculturaltax. In 1998 the central authorities passed laws to firm up far­mers’ land rights by extending their land contracts by 30 years.The system of direct elections of village committees was inau­gurated in the early 1980s in a bid to enhance accountability. In2008, a new land law recognised the increasingly commonpractice of villagers selling or renting land rights to others, butalso perhaps facilitating actions which may deprive villagers ofland rights.Despite its uneven implementation, the promulgation of theselaws has the political effect of inciting a lively public discourse of legality and citizens’ rights, together with a surge in populardemands for legal justice. Rights activism (weiquan) has thrived among the many aggrieved citizens in both rural and urbanChina. The law and the court have become the new contested ter­rain on which the fight against social injustice is waged. We willturn to the various ways inequality and related issues of equityand justice have been framed by the government, academics and the Chinese public.3 contestedconstructionsofinequalityIt is a poignant irony, and one not without political consequences,that the paradigm of class analysis has disappeared in China justas property­based classes and class exploitation have returnedwith a vengeance during the past quarter century of marketreform and opening to global capitalism. The CCP declared theend of class struggle at its historic Third Plenary Session of the11th Central Committee Meeting in December 1978. Since then,academics have also jettisoned the language of class, preferringinstead the lens of differentiation and stratification. A landmarkvolume, written by a group of leading sociologists at the ChineseAcademy of Social Science and based on a large national survey,proclaimed the formation of 10 major strata in Chinese society atthe beginning of the new millennium. They explicitly rejected the terminology of “class”, noting that the term has roots in Marx­ism that emphasises conflict of interests, antagonism and strug­gles among social groups (Lu et al 2002: 6). In recent years, main­stream Chinese social science publications have invoked the par­adigm of stratification, with research designed to measure and document “stratum consciousness”, “occupational prestige”,social mobility, “the rich stratum” and “bottom stratum” (e g, Liet al 2004). In this analysis, there are few obstacles and no struc­tural impediments to upward social mobility while the role of thestate in mediating and structuring class relations is elided. A var­iation of this approach is found in Huang (2008) who brilliantlydissects the myriad ways in which the Chinese state since the1990s has skewed policy to the detriment of the countryside and tolerated extreme forms of corruption, but offers no structural analysis of the class consequences of the privatisation of SOEs orof the consequences for workers of the actions of private capital.Notwithstanding its efforts to de­politicise the phenomenon ofinequality and class­based conflicts, the Beijing leadership con­tinues to see inequality as a central political threat to political stability, that is, to communist party rule. From the beginning of reform, the central leadership has always wrestled with the rela­tive priority of “efficiency” and “justice”. In 1985, Deng Xiaopingdefined the twin goals of socialism as the development of produc­tion and common prosperity, making the famous injunction that“some regions and some people can become rich first and theycan help other regions and other people, gradually achievingcommon prosperity” (Deng Xiaoping III: 149). Since then, theparty leadership has drifted between four discernible positions on the relative priority of these two principles over the next two decades. The Resolution of the Fourteenth Chinese CommunistParty Congress in 1992 stated that China should achieve “both”efficiency and justice. A year later the report of the Third PlenarySession proposed the principle “efficiency first, and also justice”.
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china since 1978Economic & Political WeeklyEPWdecember 27, 200835Then in 2001, the Sixteenth Party Congress stated that primarydistribution should focus on efficiency, and that the marketshould be allowed to function. Redistribution should focus onjustice. The government should function as regulator of excessivegaps in income distribution. Finally, in 2005, perhaps in light of intensified social discontent about inequality, the Hu­Wen leader­ship once again “re­emphasised the primacy of social justice, let1.3 billion people enjoy the fruit of socio­economic development”(Yang 2006; Lou 2006). Social justice is now enshrined as a pillarof the CCP’s project to construct a “harmonious society”, but doesthe state, at the centre and particularly in the localities, have thevision, the institutions, the will and the resources to overcomedeepening inequalities? If the Hu­Wen era has displayed greaterattention to the issues of rural “immiseration”, it is difficult todiscern the emergence of a far­reaching programme directed towards substantially improving the lot of the least advantaged,villagers, migrants, residents of the poorest regions and mino­rity nationalities, or constraining the rapacious behaviour ofcapital and officialdom.Since the late 1990s, official reports and government announce­ments have linked economic disparities with the rising tide ofmass disturbances. For instance, the Ministry of Labour andSocial Security warned that China’s growing income gap is likelyto trigger social instability after 2010 if the government finds noeffective solution to end the disparity (SCMP, 23 August 2005). A2005 report by the Chinese Academy of Social Science states thatthe rich­poor disparity has led to the intensification of social dis­putes, mass protests, and criminal cases. Nationwide, the Minis­try of Public Security recorded 8,700 collective disturbances in1993, rising to 11,000 and 32,000 in 1995 and 1999 respectively.In 2003, three million people were involved in 58,000 incidents,rising to 74,000 in 2004 and 87,000 in 2005. To be sure, not all of these riots and disturbances are directly caused by discontents about economic inequality (cf e g, Falungong, environmentalprotests, etc), but many are structurally the products of the “com­modification” of labour and land in the context of an imbalanced power structure.In order to understand how inequality (e g, income or wealthgap) becomes inequity (i e, morally unacceptable inequality) and the circumstances that translate such perceptions into resistance,we need an analytical perspective that is sensitive to the socialconstruction of inequality. While class rhetoric has been ban­ished by the official and the academic elite, a new emphasis onlegality and citizen’s lawful rights has emerged. Recent research(Lee 2002, 2007; O’Brien and Li 2006; Yu 2006) has documented the wide adoption of rights rhetoric among disgruntled workers,peasants and increasingly middle class property owners in theircollective mobilisation to defend their labour, land use and pro­perty rights. In response to the central government’s promotionof legal reform, deemed necessary for China’s successful entryinto a globalising market economy, but also to provide rhetoricalflourish of “ruling the country according to the law” (yifa zhiguo),and to remove the arena of conflict from the streets, aggrievedvillagers and workers have attained a new rights consciousness.The result, however, has not only been growing litigiousness, butalso a veritable explosion of direct and indirect testing of the still fragile legal system both in the courts and in the streets. In recentyears, civil disobedience and legal activism, or what in China iscalled “rights activism” (weiquan) has mostly subscribed to libe­ral discourses of rights and citizenship, even as the underlyingclass divisions deepen. Academic research (Whyte and Han2006; Lee 2006) has begun to discern the moral boundaries between inequality and inequity: at what point or under whatconditions do people begin to see inequality as unjust? Somerecent research points to the intensely emotional and moral webs of meanings surrounding the issue of inequality. Mass anger inthe rust belt of the north­east against the breakdown of the socia­list social contract and rampant corruption, or the indignationand diabolical exploitation sustained by migrant workers in glo­bal factories are the most prominent illustrations of how inequityprompts unrest. But thus far, the limits of protest are also appar­ent as the state succeeds in limiting and pacifying protest, oftenwith minor concessions.Popular discourse of inequality and the flourishing of rights rhetoric are significant effects, as well as engines, of socialchange. Rights consciousness may be a response to the Chineseregime’s own ideological promotion of “a rule by law” as a means of legitimating authoritarianism. But it may equally be the by­product of a globalising discourse of universal human rights inresponse to neoliberal capitalism. Regardless of its origins, activ­ism informed by notions of rights and citizenship, as well as class inequality has the potential to heighten pressure for change onthe social order.4 conclusionsInequality in China is not, and has not been, just an object of social scientific study. It also raises profound political and ideo­logical issues for the Chinese authorities and the Chinese people.Inequality was politicised by the regime in the revolutionaryperiod while in the reform period it was de­politicised in the sensethat grievances have been channelled toward the legal system. Inboth periods, the social structure of inequality was defined by theuneven interface of class, citizenship and locality. And social mobi­lisation has occurred in both periods, albeit in different patterns,contesting inequality and thereby creating pressure for socialchange. We argue that the stratification paradigm widely adopted in sociological research does not provide the conceptual, theoreti­cal and critical resources to capture the central role of structured inequalities in shaping the development of China. We haveattempted to sketch a three­dimensional framework that encom­passes the mechanisms, politics and construction of inequalitywhile noting the potential for transformative social change.available ataltermedia-Bookshop ecoshopM G RoadTrissur 680 001KeralaPh: 2422974
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