The Reality Behind Chinas Miracle and the Ongoing Debates

Dale Jiajun Wen

International Forum on Globalizataion September, 2007 Washington D.C.

The Rising China in the Media

The way to middle class life styleThe China my university classmates are experiencing.

The Hinterland China

A village school. It was founded in late 60s. Now the villagers have to beg a US foundation to cover the renovation cost.

Thousands of rural schools with similar history. Thousands of rural schools already closed down.

Which One is More Real?

Number of mass incidents (protests, demonstrations, or even clashes with police involving more than 100 people)
1993 10,000 2003 54,000 2004 74,000 2005 87,000

Growing Inequality
Ratio of urban versus rural per capita income early 1980s 1.8:1 2003 3.23:1 Income distribution
Top 10% Early 1980s 1995 2005 <20% (of total
income)

Bottom 10%

33.7% 45%

1.87% 1.4%

Poverty
Cheered by World Bank and Chinese government: 300 million people were lifted out of poverty since 1978. Yet, is this monetary measure of poverty accurate? The number of rural people living in extreme poverty increased from 28.2 million in 2002 to 29 million in 2003. From 2000 to 2002, 42 percent of rural households experienced decreased income in absolute terms.

Health Care
Neoliberal reform in health care From 1980 to 2003, health care costs skyrocketed 15 fold. Government and collective contribution declined from 78.8% to 44.5%. Percentage of people covered by government/collective health care Urban 1978 2003
Almost 100%

~50%

Rural ~90% <10%

Health Care Collapse in Rural Areas

Number of rural health care professionals:

1975 2001

Rural Doctors Rural Nurses 1.5 million 3.28 million 1 million 270,000

A 60 year old barefoot doctor. He has served the villagers for more than 30 years, while his total income from his medical practice is 30~40$ per month. Who will serve the village once he retires?

Health Care (Summary)

Average Life Expectancy

1949 ~35

1978 67

2005 70

2005
(urban)

2005
(rural)

78

66

In WHOs 1978 Alma Ata Conference Health For All by the Year 2000, Chinas primary health care system was featured as a model for the world. In a 2000 World Health report, China ranked 188 out of 191 countries in terms of fairness in financial contribution to health and 144 out of 191 countries in overall performance of the health care sector.

Education
Education costs have skyrocketed in the last 20 years while the share of government financing has dropped significantly. Even for primary and secondary education, nongovernment sources pay 44 percent of the cost (1999 data), A four-year college degree costs an estimated 40,000 yuan, more than 13 times average per capita rural income.

Liquidation of Human Resource

Between 1949 and 1980, adult illiteracy decreased from >80% to 33%. The number of adult illiterate population has increased from 87 million to 116 million between 2000 and 2005.

Education as a Form of Colonization

In the last quarter century, most educational materials and media imply that The only way to a better life is to industrialize, to urbanize. Everything urban is progressive and desirable, while everything rural is backwards and despicable. Peasants traditional attachment to the land is a stupid sentiment, and should be replaced by upward mobility at all cost.

Ideal Preparation for Sweatshops

Words from a female migrant worker and a survivor of catastrophic factory fire

There is no possibility to be human back in the village.

Declining Rural Investment

Government expenditure on agriculture, as a percentage of total national expenditure 1976-1980 1981-1985 1985-1990 10.5% 5.5% 3.3% The share of infrastructure investment in the rural sector decreased from 10.6 percent in 1979 to 2.8 percent in 1992 and 1.7 percent in 1994. 1979 10.6% 1992 2.8% 1994 1.7%

Left:The empty highway financed by World Bank. Right: The village road built thirty years ago.

Left:The empty highway financed by World Bank. Right: The village road built thirty years ago.

De-development of Rural Infrastructure

An irrigation canal in early 1970s. The same irrigation canal in 1990s. Photos by Joshua

Funding for Rural Exodus

More than 280 billion Yuan investment in Beijing for 2008 Olympics. The annual government spending on rural health care is only 9.25 billion Yuan(1998 data), less than 3.5% of the Olympics expenditure.

Employment and Jobs

China is NOT stealing jobs from the world. On the contrary, it is losing more manufacturing jobs than any other country due to the global re-structuring.
From 1995 to 2002 manufacturing jobs decreased 15 percent from 98 million to 83 million. During the same period, manufacturing jobs decreased by 22 million globally; thus Chinas job loss of 15 million contributed to two-thirds of the global shrinkage.

Labor Conditions
Industrial accidents result in 40,000 severed fingers in Pearl River Delta per year. Who are responsible?
Foreign-funded enterprises Domestic private enterprises State/collective enterprises

26.0%

53.9%

5.4%

From a 2003 survey in Pearl River Delta

Declining Labor Income

The average salary of factory workers at Pearl River delta only increased by $8.20 nominally between 1992 and 2004, and decreased by 30% in real purchase power.

The Families Behind Made in China

20 million leftbehind children grow up without parental presence.

Environment
Becoming the world waste dump
Seven of the ten most polluted cities in China. Pollution claims 750,000 lives prematurely per year. About 60 percent of the water in Chinas seven major river systems is classified as being unsuitable for human contact. mental pollution in export zones. Ground water table under North China plain is dropping 5 feet per year.

The river runs black or red?

The signs say, No pollution. We need to survive.

Foreign Economy Growing on Chinas Soil Tax rate for foreign MNCs: 11% Foreign funded enterprises account for 60% of Chinas export. China only as the cheap resource base, labor supplier and waste dump. China is the kitchen, while US and Europe is the dinning room.

Trickling Up of the Problems

Water crisis at Harbin city in December, 2005, at Wuxi City in June 2007. Employment rate for new college graduates has dropped to <50%. Middle class is increasingly complaining about run-away health care and housing price.

Growing Dissents
Actual quotes from the Internet
Their GDP is growing, while our livelihood is declining. Please take away the TVs, washing machines, refrigerators or whatever consumer goods, give us back the affordable health care, education and housing we used to have.

Recent Changes by the Government

Increased media coverage of the plights of peasants and workers. Increased investment for rural areas, especially in health and education. Several environmental initiatives. News slogans like harmonious society, scientific development instead of Development is the absolute need.

Ongoing Debate and Possibility of Alternatives?

Rural reconstruction movement Emerging environmental movement Emergence of new left, resurgence of old left What are the real meaning of new government slogans like socialist contryside, harmonious society, scientific development?

Some Recent Good News

IFGs book Alternative to Economic Globalization: A Better World is Possible is just published in Chinese. It would not be possible two years ago. National halt on oil to liquid and food to biofuel projects. From the official government report of the 17th Party Congress meeting:
Harmony between man and nature is one important aspect of harmonious society.