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Bitter harvest may await China's leaders

Bitter harvest may await China's leaders

RURAL UNREST has become the biggest threat to China's stability -- but the leadership has yet to come up with a viable solution.

Recent reports by the world media about internal disorder in the country have focused on the activities of the Falun Gong quasi-Buddhist sect as well as protests by laid-off workers and victims of investment scams.


Yet in year-end reviews of the internal situation, the Communist Party leadership has singled out rural unrest as the biggest threat to its rule. President Jiang Zemin has in internal talks given top priority to what he calls the "three overriding tasks in the countryside:" boosting agricultural production; increasing farmers' income; and maintaining stability in villages.

"We must use a thousand and one ways to boost the income of farmers," Jiang reportedly said in an internal discussion. "Rural stability is key to the stability of the entire nation."

Sources close to the security establishment said that despite the three-year-old campaign to curtail state employees, the numbers of the 1 million-strong paramilitary People's Armed Police would be increased in 2001. One of the PAP's main functions is the quell unrest in rural and urban areas.

The basic root of discontent on the farm is unrelieved poverty. Just-released statistics showed that income for farmers rose barely 1.8 per cent in 2000, the lowest level of increase since the beginning of late leader Deng Xiaoping's reform policy 21 years ago.

'Raise income' order

This was despite express orders that Beijing gave to agricultural and rural officials last year to raise rural income by at least 4 per cent. Per capita income in the countryside is about 2,200 yuan a year, compared to that of close to 12,000 yuan in the big cities.

Moreover, while an estimated 95 per cent of workers laid off from state factories are entitled to subsistence-level living subsidies, peasants are not covered by any security net. The number of unemployed and under-employed farmers is estimated at more than 150 million.

The official Xinhua news agency recently quoted a Ministry of Agriculture official as saying: "Rural problems such as the [low] income levels of farmers have become more acute by the day."

Many factors are behind the farmers' plight. Prices for rural items ranging from grain to pork have been depressed since the mid-1990s.

Yet peasants' biggest burden are taxes, and particularly, multiple types of fees levied by county and village administrations. Excessive levies were behind an ugly incident in central Jiangxi province last August, when more than 20,000 farmers clashed with 2,000-odd PAP officers, resulting in at least one death and injuries to more than 100.

Tax rule often broken

Since the late 1990s, the government has mandated that no farmer be charged taxes more than 5% of his income. Yet this rule is often broken.

Much more problematic are fees, the main source of funds for grassroots administrations. Thus farmers are asked to contribute to local education, waterworks and road-works maintenance, energy supplies -- as well as the salaries of most rural cadres.

In a bold move last December, Premier Zhu Rongji pledged to abolish all fees. He said farmers should only pay taxes -- and the central government would set aside 20 billion yuan a year to help defray the administrative expenses of grassroots governments.

A Guangzhou-based agrarian expert has, however, expressed doubts about the efficacy of Zhu's initiative. "At the moment, fees exceed taxes by about five times," he said. "Zhu's 20 billion yuan dispensation is far from enough to bankroll the expenses of local administrations. For example, the numbers of local cadres that farmers must support are set to increase, not decrease."

Hardship for peasants has spawned demonstrations, including ugly incidents such as attacks on tax collectors and laying siege to government buildings.

Thousands of confrontations

Western human rights watchdogs estimate that more than several thousand confrontations took place last year. Most disturbingly, the protests had spread from the traditionally poor provinces in western China to wealthy ones along the coast.

Even more ominous is the increasingly prevalent phenomenon of farmers abandoning their land and moving to urban areas.

Migration to the cities began in the early 1990s. At the beginning, these human tidal waves consisted mostly of unemployed farm hands. Yet in the past two years, the exodus is made up mostly of farmers who have abandoned their land simply because income cannot catch up with taxes and other levies.

"In many villages I visited the past year, I only saw women and old folk," said Beijing-based agronomist Zhang Xiangping. "Men from the late teens to mid-40s have gone to the cities." Professor Zhang added this might have grave consequences as the cities could not deal with the influx.

While the age-old residence permits system -- whereby farmers must secure official approval and various papers to move to urban areas -- is theoretically still valid, it has proven impossible to enforce. Most cities have tried to discourage the influx by levying charges for temporary residency and by restricting migrants to inferior types of employment such as menial labor.

Stopgap measures

Are there long-term solutions? Agrarian experts think steps such as lowering a couple of agrarian taxes or boosting subsidies can only be stopgap measures. Moreover, Beijing may be forced to roll back most kinds of farm subsidies after it has joined the World Trade Organization later this year.

The experts say the leadership must jettison the mentality -- which the Communist Party inherited from the Soviet Union -- of squeezing the farmers to subsidize industrialization before viable solutions can be found.

To this day, it can be said that the central leadership mainly represents the interests of urban enterprises and urban workers. For example, no-one among the 21 Politburo members is considered a spokesman for rural interests.

"What is needed is a new deal for farmers," said Yang Fan, an economist with the Chinese Academy of Social Sciences. "For example, they should be allowed a bigger say in determining procurement prices for produce -- and in the overall distribution of national resources. A good proportion of farmers should be allowed to move to the cities. And Beijing should devote more resources to help them find jobs.''

Yang also favored permitting farmers to form their own associations -- the equivalent of labor unions -- to press for their rights. Agronomist Zhang argued that clans, which occupy a key position in the countryside, should be allowed to lobby for the interests of rural communities. "We must allow farmers to organize themselves so that they are in a position to check and balance the powers of officials and entrepreneurs," he said.

Qin Hui, a liberal academic with Qinghua University, is a keen advocate of giving rural residents more political power. Qin said the current experiment with grassroots democracy -- which allows farmers to elect members of village administrative committees -- should be expanded to allow farmers to pick leaders of counties or even higher administrative units.

The Communist Party rode to power on the crest of agrarian support. It would be well aware that peasant rebellions have led to the downfall of Chinese dynasties in the past. As such, a worsening of the current rural crisis threatens not only two decades of reform but the party's 'mandate from heaven' to rule.

This analysis was written for Asia

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