The paradox of china’s post-mao reforms

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Chapter 1 – Dynamic Economy, Declining Party-State (Merle Goldman)
Deng Xiaoping’s program of `socialism with Chinese characteristics’ began in December 1978 and it sought to combine a market economy with the centralized party-state. Provided the party stayed in power, he was prepared to sanction any means of catapulting China out of poverty.
Because of the failures of the Mao era, Deng believed that the only way for the party to hold on to its weakened mandate was to improve the standard of living for the majority of the population. The more conservative elders wanted a controlled gradual reform, restricted to the economy, while Deng’s group moved beyond economic reforms to implement several limited political reforms. These reforms not only made China more open to the outside world, but also decentralized both political and economic power as China moved toward a market economy. For the first since the 1949 revolution, individuals, collective, and local areas were empowered to make their won decisions and pursue their own interests. After the June 4, 1989, crackdown on demonstrators in Tiananmen Square, when the conservative elders and remnant Maoists reasserted their authority, the economic reforms virtually stopped. But with the collapse of the Soviet Union in 1991, Deng in early 1991 embarked on a highly publicized tour of South China to call attention to and reinvigorate the economic reforms in order to stave off a Soviet-style collapse.
As the reforms took off, Beijing’s role as the country’s economic decision maker declined. At the same time, China’s opening to internationals trade was accompanied by an influx of Western influences in politics and culture as well as in the economy that challenged official values and official culture and moved beyond urban circles to influence rural areas by means of radio, television, telephone, fax, film, and e-mail.

Forces Unleashed by the Economic Reforms

Following the economic disaster of the Great Leap Forward, the `household responsibility system’ which devolved production decisions from the commune to the family, suddenly appeared in several areas. When by September 1962, this system had led to some dismantling of the communes and a return to market forces and materials incentives, it was stopped by Mao. In the early 1980s, Deng and his colleagues made the household responsibility system national policy. Within just a few years, virtually all the communes were de-collectivized and millions of Chinese peasants returned to family farming.

Similarly, the development of village and town industries, first begun during the Great Leap Forward, resumed and accelerated in the post-Mao era. Consequently, as China moved to the market, this sector was better able to respond to market pressures because it had more flexibility and was without the higher labor costs and larger overheads of the state industries.
Deng’s slogan `to get rich is glorious’ inspired the growth of private enterprises. When private entrepreneurs sought to grown and become more technologically advanced, they usually set themselves up as collective enterprises, while actually remained private, as this would enable them to obtain the local government’s help in securing land, buildings, market opportunities, and access to resources and loans.
While these economic reforms led to China’s accelerating economic growth, they also led to increasing political and economic decentralization as local governments made economic decisions, used tax revenue for local projects, and received less financial support from higher levels. Furthermore, as the local governments facilitated the money-making capacities of the collective-private enterprises, they formed alliances with these enterprises that benefited both sides materially. The growth of the collective-private sector thus not only helped increase the livelihood of the majority of the population, but also shifted political as well as economic power to the officials in the provinces and localities.
The special economic zones and foreign joint ventures also enhanced and accelerated China’s economic modernization, while reducing the party-state’s control. The zones, which were first established in the early 1980s, were to attract foreign investments by offering special tax benefits and involving less red tape than in the rest of China [e.g. in the late 1980s, Hong Kong began to move industries to China because of lower labor costs].
The competitiveness of the zones and foreign joint ventures as well as the flexibility of the private and collective enterprises underscored the bankruptcy of stagnation of over 60 percent of China’s relatively inefficient and obsolete state industries. This eroded the state’s economic base and weakened its economic and political power.

The Impact of Limited Political Reform

In the 1980s, limited political reforms were introduced. Examples:

1 The Tiananmen June 4 military crackdown on democracy demonstration. Unlike the Mao era, it no longer targeted dissidents’ families, colleagues, friends, and profession. Most important, after brief periods of silence, dissidents throughout the 1980s continued to express their ideas publicly.
2 In the 1980s, Deng blamed the party’s loss of legitimacy less on economic stagnation than on the instability, arbitrariness, and over-concentration of personal political power during the Mao years that led ultimately to the violence and chaos of the Cultural Revolution. Deng therefore sought to re-establish the party’s legitimacy by emphasizing collective rule, regularizing procedures, and reforming political institutions. He and his colleagues called for `socialist democracy’ and ` socialist legality’.

3 The life-long tenure of government leaders, though not party leaders, was replaced with fixed terms.

4 They also tried to separate the activities of the government and the party. They proposed that the party formulate overall national goals and priorities, while the government make and implement policies to carry them out.
5 Gradual empowerment of the legislative branches occurred at the local levels as well as at the center. Beginning in 1980 in place of party appointment, representatives to some local people’s congresses were chosen by direct vote in multi-candidate elections.

For example, in late 1980s, villagers in a number of areas were given the right to choose their won village leaders and village assemblies in multi-candidate elections, instead of their appointment by the upper levels. This further devolved central power to the local areas.

6 Leaders of the economically stronger coastal provinces have increasingly become important figures at the center as well as in their regions. Even though some have been placed on the Politburo, they are still likely to identify with their local interests. [Jiang Zemin and his Shanghai group, who have dominated the party-state in the 1990s, favor their local interests with high-level appointments and beneficial economic policies].
7 Another reform introduced to make the bureaucracy function more fairly was the Administrative Procedure Law, which went into effect in October 1990. It gave ordinary people the right to bring suit against rapacious, arbitrary officials. Villagers, for example, began bringing law suit against local officials who had confiscated their land for village industries or projects.
8 Efforts to clean up the rampant corruption have been ineffectual. Without the introduction of a regulatory system, a rule of law, and an independent judiciary, and with the Party’s continuing control over law enforcement, official directives again corruption produce minimal results.
It is surmised that too slow political change may also be destabilizing because of the obsolescence and weakening of the central government. Yet without a Deng-like paramount leader or strong political institutions, weakening party-state controls and the accompanying accelerating shift of political power from the center to the regions and local areas will continue to erode the center’s authority.

Fragmented and Fragmenting Society

The introduction of market forces and individual and collective economic initiatives, as well as the political and economic devolution of power to the local levels, has produced far-reaching social changes throughout Chinese society. Some of these changes can be seen in the alliances formed between local officials and heads of local enterprises. While alliances improved the livelihood of the nonstate entrepreneurs and workers, they enriched the local officials even more by giving them ultimate control.

In the relationship between officials and entrepreneurs in the post-Mao era, which has been called `corporatism’, the line between state and society is blurred. Because the newly rich either spring from officialdom or are dependent on officials for their increasing wealth, they generally support the political status qup rather than challenge official authority. So far, China’s expanding business class is seemingly unconcerned with political reform, because its interests are served by maintaining its present relationship with officials. Similarly, China’s business and professional classes are becoming richer and more numerous.
Another manifestation of the social fragmentation caused by the move to the market is the growing gap between the rich and poor. While the status and conditions (salaries, benefits, etc) of workers in state industries has rapidly declined, and millions had been laid off, the salaries of those who worked in non-state and joint enterprises with foreign investors have increased. The loosening of controls combined with thee unsettling effects of economic change has sparked an explosion of collective resistance in the form of tax riots, industrial strikes, and street demonstrations. In the rural areas, an increasing gap is found between the prospering managers and workers in rural industries and farmers who work in the fields. There have been, in addition, growing economic and social disparities between urban and rural areas as the urban rate of growth has increased and quickly surpassed the early rural growth.
The disparities are further widened by the easing of restrictions on the movement of workers off the farms. By 1990s, non-state and joint enterprises recruit youth and males from poorer localities to work for low wages, though their wages are high relative to their earnings in their home areas.
China’s accelerating internal migration has also increased tensions in the urban communities in which migrants settle. Urban dwellers, fearing that they may lose the entitlements that come with their household registration, discriminate again and isolate the encroaching migrants.

Cultural Pluralism

The paradoxes in the economic, political, and social spheres also exist in the cultural realm. Inevitably, China’s participation in the international community has been accompanied by the penetration of foreign cultures. The influx of Western economic practices, technology, and trade into China in the post-Mao era has also brought Western political ideas and values, as well as pornography and pop culture, especially from Hong Kong and Taiwan. Western and overseas Chinese culture has poured into China through books, travel, telephone, film, radio, television, fax, e-mail, tourism, and advertising. Neither the campaigns nor the efforts to revitalize ideology and re-centralize power, however, could stop the influx of ideas, values, and culture from the West, Hong Kong and Taiwan. Once the door was opened to the outside world, it was impossible to close it again as long as the regime wanted to be involved in internationals trade and a market economy.

Significance of the Paradoxes of Reform for China’s Future

The shfit to the market and the accompanying disintegration of the command economy released suppressed energies and entrepreneurial skills. These forces also engendered a discontent lying beneath the surface, which periodically expresses itself in workers’ strikes, farmers’ protests, and the disruption of migrant laborers. Although the reforms have given members of the population more control over their economic, cultural, and personal activities, they have weakened the party-state’s capacity to deal with society’s ills.

Because Deng and his associates recognized that economic reform required granting more economic power to local authorities, they tolerated a degree of regional autonomy. The efforts of the Jiang Zemin leadership to re-establish strong centralized control and to slow the dynamic of regionalism have been thwarted, because China’s continued economic growth depends on decentralization, privatization, and openness.
At present, the party-state lacks the political institutions and infrastructure to regulate China’s accelerating informal federalism. There are no procedures or institutionalized structures through which the regions can interact regularly with the center on policy issues. Yet unless the party-state establishes and institutionalizes a new relationship between the center and the regions, it is likely that is authority will further wane.
In the aftermath of the Cultural Revolution, the impulse for the post-Mao political and edconomic reforms came from pressures from below as well as from officials who had been persecuted. Thus the move to the market and the open-door policies that have led to a weakening party-state could in time lead to a freer, more democratic society as China’s huge population becomes more prosperous and demands greater rights. At the same time, China’s increasing geographic and social inequalities, coupled with rising expectations, also have the potential to lead to massive social upheaval and political instability. Such is the paradox of China’s reforms.


The channels of influence from economic changes to non-economic impacts are too numerous to be surveyed comprehensively. Yet two broad precesses of economic changes stand out as critically important in shaping contemporary Chinese society. This first is China’s transition to a market economy according to its own distinctive transition strategy; the second is China’s transformation from a predominantly agrarian economy to an increasingly urbanized, industrializing economy. These two processes will be referred to as `market transition’ and `structural transformation’.

China’s Transitional Strategy and Its Social Impact

It is now recognized that China followed a dual-track transition strategy. It was always assumed that system transformation would take place concurrently with economic development and, indeed that the process of economic development would drive market transition forward and guarantee its eventual success. Early reforms created pockets of unregulated and lightly taxed activity within the system. Reformers allowed such pockets to open up because they were seen as contributing to developmental objectives. If rural collectives were allowed to run township and village enterprises they would be encouraged to invest more, leading to more rapid growth. If foreign businesses were allowed to operate freely in special economic zones (SEZs) they would invest in China, bringing additional capabilities. Such policies were seen as contributing to growth while not initially threatening the overall ability of the government to manage and direct the economy.

The overall level of distortions in the system probably did not decrease very much in the initial stages of reform, but as dual price systems sprang up, distortions became more visible, because they could be measured by the difference between market prices and plan prices for the same goods.
The foreign trade strategy based initially on the special economic zones and subsequently expanded to the coastal development strategy in 1987-88 also implied the granting of numerous exemptions from regulations and taxes for export oriented producers. In each of these cases, producers were given access to profitable opportunities, the high profitability of which was at least partly contingent upon the maintenance of the rest of the planned economic system.
In 1991-92 a new phase of economic reform began. Thje focus of reforms shifted toward dissolving the compulsory plan and creating uniform rules and tax rates for all sectors of the economy. The dual-track plan and market system was phased out, and most prices were unified at market prices. The four implications of the initial transitional strategy for the non-economic outcomes of the transition are:
1 As economic growth accelerated, people were better off, and took advantage of improved conditions to acquire improved skills and enhanced capabilities.
2 Influential and powerful people at both central and local level took advantage of opportunities, along with others who were simply more alert or better equipped for a market economy. These individuals were made clearly better off, while nobody was made obviously worse off. There were surprisingly few diehard opponents of reform, and those who were initially opponents were generally bought off.
3 During the transition, complex interdependencies developed between the waing but still predominant state-owned economy and the less regulated individual and collective economy. Individuals learned to work the system, taking what they could get from the old system while simultaneously exploiting new opportunities. While some individuals who were willing to bear risk took the plunge into unregulated sectors, many individuals maintained links with the regulated sector for insurance purposes.

4 Government revenues eroded. As non-state actors were allowed into more and more of the protected niches previously monopolized by state agents, the state’s ability to earn and harvest monopoly revenue declined.

These four implications together have complex and ambivalent implications for the social impact of reform. On the one hand, reform fed development and growth so there were increasing real benefits provided to the general population. Living standards improved, with more than just material implications. Demands for information, for new kinds of cultural products, for new careers, and for new kinds of political participation increased. Moreover, groups were created with a powerful vested interest in reform, and these groups helped to ensure that economic reforms did not expire after Tiananmen, but rather resumed with undiminished intensity.
On the other hand, the distribution of these gains was unfair. Crony capitalism was prominent. In localities, enormous power was amassed by some local officials. New combinations of economic power linked emergent entrepreneurs with established bureaucrats.

Change within Transition: Reform since 1992

The transformed transitional strategy was clearly evident by 1993 when the compulsory plan and most of the remnants of the dual-track system were abolished. In the same year, a decision was make in principle to extend equal treatment to enterprises under different ownership system. Two major unifying reforms were subsequently adopted on January 1, 1994. The first was the unification of the exchange rate, which was followed by a gradual shift to current account convertibility; the second was the creation of a new fiscal system with a broader tax base and lower, nearly uniform rates primarily based on a value-added tax.

When market transition reached this stage, it began to interact in explosive ways with the process of structural transformation.

Structural Transformation

Structural transformation is perhaps best examined by focusing on its single most significant process: the transformation of the labor force from agriculture to industry and other non-agricultural occupations. Through 1991, the pressure of population on employment opportunities was great, and policy did not encourage poor farmers to leavfe their localities.

Agriculture was able to shed labor after 1991 because the modern non-agricultural sector had finally grown large enough to soak up a substantial part of long-standing rural labor surpluses. Non-agricultural employment growth jumped from under 10 million jobs a year before 1991 to about 17 million a year after 1991. Some of the non-agfricultural growth was due to the ongoing structural transformation of the economy, but some reflected the steady growth of non-state employers.
Changes in the rate of growth of non-agricultural employment and in its ownership composition are emblematic of a whole series of changes reflecting a more mobile labor force. Jobs in state-owned enterprises, once held for life, are increasingly uncertain. The pace of quits and fires has accelerated. As job mobility increases, there is recent evidence that returns to education and other skills are increasing.
Urbanization causes major social changes everywhere, and the influence of urbanization, and to a lesser extent internationalization, is affecting every aspect of Chinese society. Urbanization is associated with increased diversification and social freedom for individuals. Whether or not one chooses to attribute political importance to such changes, it is clear that it is easier for individuals to sort themselves into lifestyle subgroups. At the very least, this reduces the monotony of city life.
Finally, there is one additional factor associated with structural transformation: the demographic transition. Because of China’s draconian birth control policies, China had been led into a precocious demographic transition. There are few elderly (since life expectancies were low until recently) and few children because of strict limits on births. As a result the share of the population in the young adult age bracket is quite high. China’s population is unusually adaptable, active, and resilient, because it is so young yet lacking a huge population of dependent children. Individuals under forty are much more willing and able to adapt to major work changes than workers over forty. This means that it is well positioned to cope with the dramatic social and economic changes occurring all around.


Farmer or agrarian interests are articulated both at the grass roots and at higher or elite levels of the political hierarchy by advocates. Advocates for farmers and agricultural interests come from among the rural deputies to the National People’s Congress. Elite advocates are members of party and state agencies and their affiliates. Public advocacy can be seen as a visible part of bureaucratic and elite politics, often expressive of and tied

To the policies pushed by particular leaders.

Social Interests in the Mao and Deng Eras

During the Mao period, the scope for group interest was systemically limited by the goal of building a new society in accord with an ideological and developmental vision which overrode partial interests. In extreme phases of mobilization, rulers paid little or no attention to group interests.

During the consolidation periods that followed intense campaigns of mobilization, the real interests of social groups became more salient to the leaders because of the mounting costs of ignoring them. Leaders responded to evidence of the peasants’ declining enthusiasm for production or as in the case of the Leap, to evidence of mass famine and instability.
During the post-Mao reform period, the goal of building a socialist and communist society largely lost it salience. The pressure to override group[ interests for the collective good has declined, and the regime instead relied on material incentives. Moreover, declining political control capacities increase pressure on the regime to pay attention to the interests of strategically important groups.
In the post-Mao era three periods of regime receptiveness or responsiveness to farmer interests can be distinguished:
Phase 1: Peasant and Regime Interest in the Transition to Household Contracting, 1978 – 1983
During the initial reform period, the regime went to unusual lengths to accommodate peasant interests. In later 1978 it sharply raised base and above-quota procurement prices, and it moved rapidly to restore the private sector. Most remarkable, policymakers moved from outright rejection at the watershed Third Plenum to at first highly restricted and ultimately full acceptance of the household responsibility system (HRS), that is, of family contract farming, despite its earlier harsh repudiation as capitalist by Mao in 1962.
Reasons for agreeing to HRS:
1 political conflict played an important role in propelling HRS forward, since reformers came to use HRS adoption as a club with which to beat leftists.
2 elite proponents of HRS secured the support of policymakers by presenting the reform as compatible with socialism, especially since land remained in the hands of the collectives.
3 HRS was made more acceptable because output of grain and cotton continued to be planned and subject to state procurement.
4 Reform leaders became convinced of the efficacy of household contracting as a generally applicable method for raising output, productivity, incomes, and diversification., thereby laying the foundation for all-round rural development.
5 Leaders came to believe that HRS would save the state money. The savings to the state would derive from no longer having to ship costly relief grain to poor villages that now practiced HRS. Leaders came to believe that rising rural incomes would enable the peasants themselves to bear more of the investment burden in agriculture.

Phase 2: Strong Advocacy but Low Response, 1984 – 1990

If peasant influence was unusually strong during the transition, it declined in the years that followed. While rural industrial and commercial enterprise grew during this period at astonishingly rapid rates, especially in the coastal regions, the agrarian sector was beset by a series of problems. Grain output stagnated until 1980, staying below the peak level attained in 1984. Agricultural investment from all sources lagged, leading to stagnation of even decline in indicators such as area covered by irrigation.

Rural per capital incomes, which had more than doubled between 1978 and 1984, largely stagnated in real terms during the remainder of the 1980s. This stagnation concealed striking disparities between those whose earnings came largely from non-agricultural sources and those whose income depended largely on farming. Rural income in the coastal provinces grew much more rapidly than in the central and western provinces, resulting in rising rural territorial inequalities.
Stagnation in agriculture was also caused by the state’s lowering of procurement prices for quota grain and cotton 1985. This step was taken to reduce the state’s heavy burden of subsidizing urban consumers.
In order to compel governmental attention to agriculture, NPC advocates called for a law on agriculture. Without a law, agrarian interests had to reply on policies that were easily changed and subject to the sudden whims of leaders.

Phase 3: Rising Regime Receptivity to Agricultural Interests in the 1990s

In lat April 1989, when the Tiananmen demonstrations were gaining momentum, Den Xiaoping assured Li Peng and Yang Shangkun that there is no problem with the peasants. Indeed, the demonstration seemed to confirm the proposition that the urban sector was the source of instability in China. Nevertheless, Deng’s confidence in the stability of rural China disregarded evidence of mounting discontent in the countryside. Had rural people joined the 1989 protests and had urban protestors been willing to link up with them, the Tiananmen crisis would have been far more severe.

In 11991 Deng reported reversed his 1989 view, saying that China’s stability hinged on whether or not the lives of peasants improved. In 1992 and 1993, hundreds of protests, demonstrations and riots erupted, mainly in heavily agriculture dependent districts where villagers had become increasingly enraged by the financial burdens imposed on them by the local and higher-level bureaucracies and by the failure of state procurement agencies to pay formers in cash.
Central policymakers recognized that agriculture had become the weakest link in the national economy, requiring state protection in the market economy. They recogtnized that growth in agricultural output without growth in farmer incomes could not be sustained. The concluded that agriculture should no longer be exploited on behalf of urban and industrial growth but required more state investment.
Consequently, in the mid-1990s, procurement prices were raised substantially in an effort to offset the impact of inflation. State investment in agriculture also incrased.


Extensive public advocacy exists on behalf of farmers’ interest. Although a specific link between advocacy and policy has not been established. It seems reasonable to conclude that advocates do play a role in the policy process. They lack the clout to compel attention, however, even when they communicate reports of local discontent. Top leaders seem to act mainly when they see unmistakable evidence of substantial societal instability and when they see a large threat to their developmental goals. When they do act, they experience great difficulties with implementation of remedial measures.

At the same time, advocacy of the interests of farmers has become a part of an ongoing public discourse on interests. This represents a substantial change from the Mao era.


The Reform Era: The Collapse of Opposition and the Obliteration of Boundaries

With the opening of markets after 1978 the segregations began to break down, as some rural residents made their way into town. But it took until April 1983, with rural reform attained nationwide, for central politicians to begin to relent on the policy on migration. The state Council’s `Regulations concerning Cooperative Endeavors of City and Town Laborers’ was the first to permit rural residents to move into market towns, albeit without shedding their rural registration.

In July 1985 a new document, the `Provisional Regulations on the Management of Population Living Temporarily in the Cities’ represented an effort by the Ministry of Public Security to ensure its control over the floating population and to increase its data on it.
In 1986 it became legal to sell grain at negotiated prices to peasants at work in the cities. This did much to facilitate longer stays. Thus by the middle of the decade, the state had acquiesced in the right of those from rural areas o make at least a temporary home in the cities. It took no responsibility for their material or physical well-being.
In 1988 the State Council and the Ministry of Labor put still another stamp of approval on the outflow from the countryside, this time with a recommendation that provinces with impoverished populations `export’ their labor.
1989 and again in 1991, the State Council issued rulings on the management of temporary labor in state enterprises which in contrast to similar measures of the 1950s, allowed managers to sign contracts directly with the worker him- or herself, and only afterward report this to the local labor department for approval.

The By-product of Other Policies

Certainly the state’s explicit sanction for sojourning propelled many peasants to desert the soil. But their migrations were also a by-product of practically all of the other policies that made up the general program of economic reform – the termination of the communes in the countryside, the pro-coastal developmental strategy, profit-consciousness in urban firms, and the creation of urban labor markets.

Each of these related economic reform policies had at least one of two effects, both of which were crucial for enticing peasants to live and work in urban areas. First of all, several of these measures provided channels for obtaining the necessities of daily existence outside the state’s monopoly: by legitimizing markets for necessities, the various reforms made feasible the livelihood of farmers in the cities.
New financial arrangements after 1980 allowed local governments to retain a protion of the revenues from tax receipts, and enterprises were allowed more leeway, including the right to keep some of their own profits, along with less supervision over their hiring practices. These various incentives propelled a feverish construction drive that cried out for extra labor.
It was not just that jobs increased in the cities; other factors were also at work. After 1978, the Ministry of Labor relaxed the former recruitment system, whereby young people were forced to wait for job assignments from their local labor bureaus. With the reforms inviting foreign investors into the country, city youth found new employment opportunities on their own in classy occupations such as tourism and foreign trade and therefore rejected careers in the traditional trades, such as textiles, machinery, and building materials.
The termination in 1979 of the Cultural Revolution-era policy of sending city youth to the countryside mean that rusticated young people started returning home. It was proposed that young people be permitted to set up their own privately funded and operated enterprises to remove from the shoulders of the state the strain of creating jobs for them all.
With the unfettering of market forces, and in the consequent creation of the floating population in the cities, is a melding of the contradiction and an evisceration of the borderlines among opposed categories.

Institutional Collision

The economic reforms did more than destruct long-standing divisions. They also caused a collision between two forms of institutions. The new economic institution of the market that let farmers, entirely on their own, flee from the fields, clashed with the old statist, political institution of urban citizenship, as structured for decades by the `hukou’ system. The migrants are poised at the intersection of these two institutions, just where they collide: in bringing ruralites to the urban areas, markets undermined the former exclusivity of urban residence,. So without any political pressuring, but just by subsisting in the city, peasants shattered urban citizenhood.

Migrants and Labor Markets

At the start of the reform period, peasants’ principal entrée into the city was via contracts between their rural units and urban state enterprises. Rural migrant laborers continued to take on contracted work in state industrial firms in the cities in increasing, if difficult to document, numbers as time went on. Well before the end of the eighties a wide array of urban opportunities for performing odd jobs had appeared, wholly separate from any form of official employment. These included marketing and services, cottage-style garment processing, manufacturing in foreign and other non-state factories, nurse-maiding in private homes, and begging and scrap collecting.

Landing a spot in most of these trades usually involved no contracts or ties with the state at all. Instead, most peasants acquired their position either through their personal connections or else at anonymous spontaneous labor exchanges held in the open in city streets and squares.
Recruitment of peasant temporary labor into the non-state and foreign sector also involved personal ties, sometime accompanied by bureaucratism.

Migrants and the State: New Forms of `Citizenship’

Citizenship has two critical components: 1. to belong to the community, and 2. to have rights to a share in the public distribution of its goods.

The deprivation is evident when we consider the official ineligibility of peasant migrants for any medical, housing, educational, welfare, or services of any sort in the cities up through the first half of the 1990s.
Housing: the relevant rulings were particularly strict in the case of housing: only short-term, registered sojourning with relatives or in hostels, rentals arranged by contracted agreements with landlords, or work-unit-provided beds were legal. Regulations forbade outsiders not just from building or buying houses, but even from occupying land.
Health Care: Migrants had to find other options as public health facilities were not available to them. If a floater could land a position in a successful state-owned firm, some form of health care facilities would be available to them.
Education: since the offspring of the floating population had domiciles that were registered in the countryside, city officials had no sense of legal obligation to teach them in the cities. Migrant children found that schooling was legally unavailable for them.`
Services: Transients huddled in t he midst of the city, or taken care of by work units for landlords, could partake of at least some of the basic amenities of city life – water, sewerage, transportation, electricity – though certainly not in comfortable quantities. But those on the outskirts would have to depend entirely on their own resources.


In the transitional era, as the Chinese state was forsaking its socialist pattern, by the very act of sanctioning markets, its leadership was also involuntarily relinquishing its ability to mold society into rigid, contradictory categories. The result in this case was that markets, with their own modes of developing productive forces, worked to erase state-imposed oppositions among regions, sectors, and occupations. Markets also became available to outsiders venturing into settlements previously strictly delimited against them. Consequently, peasant sojourners collided against and proceeded to knock down the intangible but once solid barricades around the cities that state had erected against them.

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