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2 China: More rights for
millionaires By Pallavi Aiyar
BEIJING - After years of galloping
economic growth in China, the ruling Chinese
Communist Party (CCP) has much to celebrate.
However, the growth has come at a cost, and rather
than strengthening the party's hand to press ahead
with further economic reforms, growing
inequalities, rampant corruption and vanishing
provisions for health care and education have put
China's leadership in somewhat of a tight spot.
Increasingly squeezed between the demands
of the right and the criticisms of the left, the
CCP is engaged in an ever more delicate
juggling act, balancing the
interests of the urban middle class, who have
emerged as a key constituency of support, and a
restive peasantry, once the party's mainstay but
progressively disaffected at being left behind by
the economic boom in the cities.
China's
unique form of "socialism with Chinese
characteristics" is rent with contradictions, and
many of these are forcibly coming to the fore. The
recently concluded annual session of China's
parliament, the National People's Congress (NPC),
usually a sedate piece of set political theater,
was thus the site of some unusually feisty debate
this year.
The main bone of contention was
a landmark bill providing the legal basis for the
protection of private property for the first time
since the CCP came to power in 1949. The NPC has
never voted against a bill proposed by the
government and, as expected, the close to 3,000
delegates approved the property-rights bill.
However, its passage was atypically rocky,
requiring the government to answer some fierce
criticisms from an increasingly vocal cohort of
new-left thinkers.
The bill took 14 years
in the drafting and was subject to a record seven
readings by legislators since being tabled in 2002
(most bills in China are passed after three
readings). It was in fact scheduled to be passed a
year ago, but widespread objections amplified by
heated Internet-circulated commentaries forced its
last-minute withdrawal from the parliament's
agenda. One of the bill's most vocal critics, a
law professor at Peking University, Gong Xiantian,
condemned it as "copying capitalist law like
slaves" and offering equal protection to "a rich
man's car and a beggar man's stick".
For
the left, the bill represented a final sellout by
the state to capitalist interests. China has
already embraced several other free-market
mechanisms such as stock markets, but the idea
that socialist property is inviolable has long
been an almost scared legal principle in China.
The debate about property rights thus goes to the
core of China's modern identity.
"Socialism is based on public ownership.
This won't be a glorious page in the history of
Chinese legislation," Gong Xiantian said of the
property bill at the start of this year's
parliamentary session.
The fact that the
government threw its support behind the bill
despite the sharp and often public critiques the
draft law provoked reflects awareness of the
increasing weight of the private sector in the
country's economy as well as the importance of the
support of a property-owning urban middle class to
the party's continuing reign.
Until 1998,
state-owned firms were the mainstay of the
economy, but today private businesses account for
more than 65% of gross domestic product and more
than 80% of economic growth, according to a recent
report by the All-China Federation of Industry and
Commerce (ACFIC).
This buoyancy of the
private sector followed policies instituted first
by Deng Xiaoping, the architect of China's
economic reforms, and carried on by Jiang Zemin,
his successor as China's ultimate leader. Both had
decided that real and rapid growth could only come
about by unfettering the private sector.
Deng called economic development "hard
truth", and under Jiang the restructuring of
state-owned enterprises was accelerated, leading
to more than 20 million workers being laid off in
a huge wave of closures, mergers and
privatizations that halved their number since the
mid-1990s.
It was also because of Jiang's
efforts that in 2002 the party threw open its
doors to private entrepreneurs. According to
ACFIC, almost a third of entrepreneurs who
registered their businesses after 2001 are now CCP
members.
For President Hu Jintao and
Premier Wen Jiabao, who inherited the country's
leadership in late 2002, the contradictions of
China's special brand of state-led capitalism are,
however, becoming ever more apparent.
In
the span of some 25 years, China has gone from
being one of the world's most equal, albeit poor,
societies to becoming the fourth-largest economy
in the world, with one of the worst rich-poor
imbalances. China's Gini Index - a commonly used
statistical measure of inequality where 0
represents perfect equality and 1 perfect
inequality - of 0.447 is worse even than India's
0.325, according to the United Nations' 2005 Human
Development Report.
Property that used to
be taken away from the rich for redistribution to
the poor is today routinely taken away from poor
farmers and given to real-estate developers.
According to the Ministry of Public Security, in
2005 there were 87,000 mass protests across the
country expressing public anger. Some were
directed against official corruption and unpaid
wages and pensions, but most were against illegal
land grabs. The number of
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