It’s that time of year again, China’s National Party Congress, when protestors and anyone who might in any way make the party look bad is silenced in one way or another, be it house arrest, temporary exile from Beijing or what have you.
That’s been the drill for years now, so no surprise to read that it’s no different this year. But I did feel disappointment to read that part of the CCP’s agenda for making everything look good and harmonious and happy includes ending all public discussion of the very controversial Zhongguo Nongmin Diaocha, the publication of which I saw as a hopeful sign of a new Gorbachev-style “glasnost” in China.
This week the Communist Party’s propaganda department issued a nationwide media notice listing several books regarded as too sensitive for further public discussion. Among them was A Report on the Condition of China’s Peasants by investigative journalists Chen Guidi and Wu Chuntao, a harrowing account of how China’s 900 million villagers are taxed and exploited to provide funds and cheap labour for dazzling coastal and urban developments. Party propagandists said the book should not be publicised or criticised, meaning it should disappear from public discussion. However, it has not been removed from sale.
The two authors are being sued by one of the officials whose alleged depredations on peasants were detailed in the book. The official is taking action in a local court in which his son is a judge, a fact that has not appeared in the official media.
Remind me not to get too optimistic about reforms again anytime in the near future.
It seems like it was a hundred years ago, but it was only last year that the CCP reached a new low at its Party Congress, clinking champagne glasses and beaming at the magnificent implications of all its rubber-stamped amendments. Only a few weeks later, the world would be shocked to learn that SARS was spreading through Beijing, that the CCP knew it and ordered all news of it suppressed during the Congress.
I keep hearing that the new leaders are different, and I’ve been impressed at times by what I’ve seen. But the sins of last year mustn’t be forgotten so soon. It was too much of a betrayal of the people’s trust to simply slough off.
Many have said that this was a pivotal moment for the CCP, that they learned from it and would not repeat the same mistakes again. And I am willing to believe that. But as Ronald Reagan would say, “Trust, but verify.” I’m willing to believe, but they’ve got to show me the money. I’ve devoted more space to the Nongmin Diaocha than to any other topic recently. And now i read that pubic discussion is about to be suppressed. So what should I think?
Update: For a humorous look at how the Chinese media grind to a halt for the People’s Congress and spit out pukish pabulum on how dandy things are, you have to see Danwei’s post and photos.
1
By steve
Richard,
FYI. You spell Kaiser’s first name wrong in your link.
March 4, 2004 @ 12:09 am | Comment
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By Richard
Steve, not sure where you mean. It’s Kaiser Kuo, no?
March 4, 2004 @ 12:15 am | Comment
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By steve
It is listed as Kaizor Kuo on your webpage. Trivial stuff. Never mind.
March 4, 2004 @ 12:24 am | Comment
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By Kaiser
Confusion due to my Live Journal user name, no biggy.
Hey, but about the Investigation on the Condition of Peasants — sounds like The Age is doing a bit of interpretation here. I haven’t seen the list, but in the words of the article’s writer, “Party propagandists the book should not be publicised or criticised,” and the meaning supplied – that it should disappear from public discussion – isn’t explicit. Half full, half empty…
I have it on pretty good authority that there’s going to be open talk about the most onerous of problems faced by peasants: the arbitrary taxes and fees leveed by local tyrants. Word is they’re going to abolish all of them. What’s everyone heard about this? The other major shift is in land ownership: to encourage scale (making mechanization practical, increasing efficiency) there’s a move afoot to allow and encourage property transfer. Wang wants to move to the city and sell his farm to his neighbor Zhang? Great! Let Zhang buy it, or lease it. We’ll see what really happens, but this is what my agriculture contacts are telling me is in the cards. Fingers crossed!
March 4, 2004 @ 12:46 am | Comment
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By steve
I once worked in a poor mountainous area for two years because of my participation in Tiananmen movement. The situation there is even worse than what was described in Diaocha. The poverty was shocking, especially for disadvantaged people. In Mao’s time, those people are generally supported by the whole village. Nowadays, their neighbour still help, but mostly they are struggling alone.
Regarding land transfer, in Chinese history, peasants do not rebel as long as they can have a piece of land to feed themself. If they do not have a land, they are more likely to rebel.
If peasants are allowed to sell their land, they could get a lump sum. But if they can not manage well, they will be out of money and out-of-land. Then they could become volcano. (Similar situation with Bush’s proposal to let individuals to control social security fund). Sounds good, very risky.
March 4, 2004 @ 1:30 am | Comment
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By zhwj
After reading the massive thread yesterday and other comments around the net, I went and bought the Survey of Chinese Peasants. I’ve only really read the first hundred pages or so (4 chapters) and skimmed the rest–I can understand why it is so popular–the authors have that news-magazine mixture of breathless characterization and rapid scene reportage (some of it must be fictionalized, due to the time and access questions)–the fight scenes compare to anything in recent anti-corruption fiction. To western sensibility, there are parts that seem overly maudlin and sentimental, but it all seems to work in terms of the book as a whole.
It seems that the reason it has been permitted so far, and the reason why it might be discouraged in the future might be two sides of the same coin.
Yes, the book lays out scandals in the countryside, but crucially, it identifies the problems as local rather than institutional. Corruption stems from the small officials, and goes up to the provincial level, but stops there. The Central government’s policies, and the attitude of the government bodies in Beijing, while impotent and stymied by lower level corruption and obstruction, are nevertheless benevolent. This is not merely evident in the anecdotes (such as the peasant representatives’ trip to Beijing in Chapter 4), but the foreward, too, states, “The question is, when the central government deeply understands the people, why do its burden-lifting policies fail to be thoroughly carried out? Moreover, the leaders (Jiang, Hu, Wen) come off very concerned (esp. in Chapter 10, among other numerous citations). Certainly the book reveals the less-than-ideal lives of the vast majority of China’s population, but it gives the readers someone to blame (local officials, local media), and someone to look to for hope (the central government, Xinhua news agency). This is, I think, the reason it is tolerated, and even encouraged. Especially now with last year’s change in leadership, there is the opportunity for something of a break with the past–witness the articles in China Daily quoting peasants to the effect of, “In the past we had hardships, but with the new leadership we see things looking up.”
However, there always is the potential that things could get out of hand. People could start questioning the central government on this issue–why nothing was done earlier, or why Xinhua reported only a few of the events–and this would be dangerous. The authors make reference to peasant uprisings in the past. This apparently is fine, as long as it is local and directed at minor officials who can be removed and replaced. There are some officials, however, who can’t be removed…
That’s not to say that the situation has already reached this stage; I too see the Age as blowing things up a bit. But I’m glad I got a copy of the book before it is supressed…
March 4, 2004 @ 12:04 pm | Comment
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By Conrad
Talk, talk, talk. That is all that any of this recent so-called reform has amounted to — and the talk in invariable repressed as soon as it threatens to lead to any real action.
Furthermore, alleviating the corrupt abuse of peasants isn’t really substantive reform at all. Its purpose is not to help the victims but simply a recognition that such extreme abuse could lead to uprisings which would threaten the CCP’s hold on power. In other words, it’s completely self-serving.
March 4, 2004 @ 12:53 pm | Comment
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By richard
Conrad’s point is important. I’ve always felt that great as many of the reforms have been, they were more aimed at keeping the party in power than in improving the people’s quality of life. That begs the question, Then why the reforms in the social arena — sex shops, risque magazines, recognition of gays, linglei doing their own thing? To me, that’s simple (andSingpore is doing the exact same thing). The lifeblood of China’s current system, along with corruption, is foreign investment. As Singapore learned the hard way, discrimination and a nanny state don’t bode well with liberal businesspeople from the US and Germany and the UK. Shanghai cannot become the cosmopolitan world trade center Deng envisioned if it maintains its antique social restrictions. So I don’t see much of the reform to date as especially altruistic.
So should I take the cynical approach and pronounce, as Conrad does, that there is much less here than meets the eye? I’m going to hold off on that, while saying that based on past history I have no choice but to lean more toward Conrad than toward Kaiser.
Actually Kaiser may have made this a bit easier for all of us. He has alluded to rumors he has heard on good authority that indicate Conrad is wrong, and that meaningful change is on the immediate horizon. I know things take a long time to happen here, so I won’t expect overnight change. But now is when the National Congress meets, and if there’s going to be dramatic changes they’ll be announced here. If China is really at an inflection point, we should know pretty soon — there should at least be styrong signals, if not instant action. And as i’ve said a lot lately, I’m giving them the benefit of the doubt. I am willing to be open-minded. But not forever.
March 4, 2004 @ 1:25 pm | Comment
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By Kaiser
I think you exaggerate to say that the lifeblood is foreign investment. The lifeblood is export earnings, and domestic consumer demand. I don’t have the numbers handy but that seems to be what economists I know are saying about China.
Of course their motives are to stay in power. You believe that democratically elected rulers or individuals desiring to become such don’t push for measures that would improve people’s lives for the same reasons? If we’re going to be cynical, let’s be cynical all the way! 😉
March 4, 2004 @ 8:11 pm | Comment
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By richard
Kaiser, I truly believe foreign investment is No. 1 for the PRC. That’s not a bad thing. It’s just a fact of life, I believe. Much of the awesome construction we’re seeing in China is a result of foreign investment. My own company and all our clients were part of this, all investing in office space, factories, etc. Take away the foreign investment and much of China’s economic progress evaporates in a heartbeat. The manufacturing sector is safe, and doing splendidly. But so much else is an investment for the future, not yet generating profits. I don’t think this is a new concept or a secret, but I may be wrong.
I wrote about this at length in a post about Chasing the China Dream. Have you read the book? It really opened myt eyes.
Of course, everyone in power wants to stay there. I think it’s a matter of degree.
Sorry to cop out in mid-comment, but I have to leave my Internet cafe, back later.
March 4, 2004 @ 8:32 pm | Comment
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By Kaiser
Are you talking about Joe Studwell’s book? Ask around in the foreign correspondent community here in China and see what they think of it, honestly. I know the author and I’m sure were you to talk to him about it now after all the criticism he’s gotten from other China-watchers in Beijing he might tell a different story. FDI’s important, sure — all 500 billion of it since China’s reforms began — but look at that relative to hard currency earned in exports in the same 25 year period (again, I don’t have numbers in front of me) and I’d wager it dwarfs that figure. Anyway, good luck in your move, and do you plan to continue baking Duck posts when you’re back in Phoenix?
March 4, 2004 @ 8:51 pm | Comment
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By Richard
I don’t agree with everything in Studwell’s book, but it does drive home how big a role foreign investment plays in China’s economy. A lot of the book is dated already, but it’s still well worth reading to understand Chinese spending habits, and all the obstacles the CCP has erected to make life misery for companies seeking to get rich from China’s famed “1.3 billion consumers.”
do you plan to continue baking Duck posts when you’re back in Phoenix?
I can’t imagine just stopping this blog dead in its tracks upon arriving in America. I suspect I’ll keep posting as usual, though I’m sure that little things — like finding a job — are going to kep me too busy to post at anything close to the current level. And who knows, some quirk of fate may end up transplanting me back in Asia sooner than anyone would think. Anything’s possible.
March 5, 2004 @ 1:18 am | Comment
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By kevin
hey, my girlfriend, who is (for some reason) very passionate about sitting at home all day and watching phoenix tv, claims that there will be a special documentary on this peasant book next week on phoenix. i for one tend to not believe her, since the book is now becoming “off limits” or something, but just wondering if anyone else had heard about this?
March 5, 2004 @ 11:15 am | Comment
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By Stephen Frost
Kaiser’s points deserve more than I can offer in a little box, but a few points:
1. On Studwell’s book: I listened to the China correspondent from a major US daily rip into it about two weeks ago. I was taken aback by the ferocity.
2. On FDI: Long version short – depending on the source, somewhere between 25 – 50% of China’s inward FDI is the result of round-tripping (Lardy at the lower end, the World Bank at the upper). I.e., mainland companies invsest in shell companies offshore (often in HK) and then re-invest that money in China to take advantate of preferential treatment. So a good chunk of inward FDI is not foreign – it’s of mainland origin.
2. If the WB figures are correct (and most people think they’re too high, but for the sake of argument I’ll use them), then FDI as a percentage of GNP barely makes it to 2%.
3. On Trade: According to UNCTAD, exports from China in 2003 alone totalled $325.6 billion. (Inward FDI – including round-tripping – was just over $52 billion).
March 5, 2004 @ 12:45 pm | Comment
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By Richard
Interesting, Stephen.
I’m not expert enough in economics to argue with the numbers. I always thought, based on what I’d read in the news and in books, that foreign investment played a greater role than the numbers you cite; when we look at the investment that companies like GM and all the other car companies and the chemical companies and the retail stores are making, it’s pretty huge. I always thought, again based on news articles, some pretty recent, that foreign investment was a major force in shoring up the banks and keeping things going. If it’s not key — or at least one of the keys — to China’s continuing growth I’d be surprised.
March 5, 2004 @ 1:09 pm | Comment
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By richard
One last thing about Joe Studwell. Stephen’s comment that he heard a correspondent blasting the book China Dream just reminded me why I bought the book in the first place.
About five months ago I had lunch with a senior editor and the Asia-based correspondent of what is most likely America’s most respected business magazine. We were talking about Chang’s Coming Collapse of China, which I said was too extreme. They agreed, and said the book I needed to read was Studwell’s, which I bought the next day.
Joseph Kahn of the NYT thinks well enough of the book to quote from it (http://www.iht.com/articles/82258.html) and I’d say most of the reviews were positive, with a few glaring exceptions. (I just waded through about 40 of them.)
I do think Studwell went too far in his apocalyptic predictions for US companies seeking to sell Western products to the Chinese. But I think he’s more right than wrong — a lot of companies did go in with foolish misconceptions about how easy it would be to make a fast buck there, and his examples are illuminating. And a lot are still throwing vast amounts of investment dollars down the toilet. Even now (and that’s something I have seen with my own eyes).
About foreign investment, I am not smart enough to discuss that at a high level. I only know China is now the world’s No. 1 recipient of FDI, and if you do some searches you’ll see that many articles attribute the growth in manufacturing and just about every other sector that’s taken off to foreign investment. Even if it’s only 2 percent of GNP, a lot of analysts still seem to believe it is the fuel behind the take-off. Is this a misconception? (Asked with sincerity; economics is not my strong point.)
March 5, 2004 @ 2:25 pm | Comment
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By Stephen Frost
Hmmm, I just lost an entire posting so this is the shortened version of what I just wrote…
Joe’s book is worth reading, but his blind spot is that he doesn’t think foreigners make money in China. They’re not all losing out – the ones making money are just quieter about it. For another take on this issue you could read Nicholas Lardy – cited in Joe’s bibliography by the way – who makes many of the same points as ‘The China Dream’ but with a little more caution. Studwell seems to derive pleasure from documenting failures, but Lardy is more reserved and dare I say balanced (even when he’s optimistic he puts the contrarian view). His ‘Integrating China in the Global Economy’ is not quite so exciting as Studwell’s bestseller, but it’s richer in data and provides a more nuanced version of what’s happening.
On the FDI: China received more FDI than the US in 2002, but that wasn’t the case in 2003 where the figures were, respectively, $53 versus $86 billion. Xinhua reported on those figures earlier this year here. The world’s largest recipient of FDI in 2003 was Luxembourg with $103 (see here). This figure, like the one that puts the British Virgin Islands in the top five investors in China, doesn’t tell us much other than these are nice places to funnel money elsewhere.
Which is my point about FDI. Standard economic analyses of FDI will point to data based solely on bilateral statistics. In this view, the BVI is the second-largest investor in China. But it’s not really, is it? FDI from the BVI originates in Europe, Hong Kong, the US, and even China (round-tripping back in as ‘foreign investment’). It’s just plain messy.
Back to FDI: There are two kinds of FDI in China: FDI designed to gain access to a market (e.g., GM, as you mentioned), and investment seeking to minimise costs (i.e., export production). The latter accounts for about 65% of all FDI. This leads to two things: one, about 40% of imports coming into China are components for products that will be exported; and two, FIEs account for about 50% of Chinese trade.
So yes, FDI is crucial (but you can’t disaggregate it from exports). And yes, exports are bigger, but they are dependent on FDI. My point, which I didn’t make very clearly in the post above, is that the standard bilateral statistics we see (e.g., US companies invested $XX billion in China) don’t tell us very much. Nor do accounts that focus on the importance of FDI (or exports, for that matter). Exports, imports, FDI and a host of other political and social matters are entwined in a great big messy picture that nobody has yet made sense of to my satisfaction.
Which is why Joe sees it one way, and other people see it another way. We’re fleas looking at a very large, constantly changing, mostly hidden, beast.
Ha. You really didn’t expect an answer did you? 🙂 🙂
March 5, 2004 @ 3:52 pm | Comment
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By richard
Stephen, that is a really useful comment, especially for economics dummies like myself. Your points about FDI and the Virgin Islands certainly drives home just how messy deciphering the numbers can be. It’s inspiring to see that I am probably not the only one who finds it bewildering.
Looking at everthing you write, is it fair for me to sum it up by saying that exports are bigger than FDI but that FDI has played and continues to play a key role in making China’s exports possible? Or is that too simplistic an equation?
Thanks for your patience!
As for Studwell, it’s quite true that he focuses on the failures, and you’d walk away from the book believing that no Western company selling its products to the Chinese — with the exception of MacDonalds hamburgers and mobile phones — will ever make a profit in China. But it is filled with great information on how China works and how companies have screwed up there in the past. Every businessman considering going after the Chinese market should read it, probably twice.
March 5, 2004 @ 5:25 pm | Comment
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By salcia-co
http://salcia-co.net
June 21, 2005 @ 5:26 pm | Comment