China’s Highly Unequal Economy
By Victor Shih
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PlurkDouble-digit growth can’t hide the fact that China’s state-controlled economy is leaving the vast majority of citizens behind.
During a round table with business leaders during Chinese President Hu Jintao’s visit to the United States in January, US President Barack Obama stated optimistically that ‘With China’s growing middle class, I believe that over the coming years, we can more than double our exports to China and create more jobs here in the United States.’ To be sure, that is a reasonable expectation. When other Asian economies like Japan and Korea grew toward the GDP per capita level of $10,000, sizable middle class populations did indeed emerge.
However, when looking under the bonnet at China’s economic engine, it’s clear that a growing middle class with rising disposable income and consumption is missing. Instead, there’s an economy that is still dominated by state owned firms and state-led investment, as well as by rapidly rising inequality. Instead of an enlarging urban middle class, China is increasingly splitting into a small upper class that spends freely on luxury goods, and a remaining population whose earnings and savings are eroded by inflation and state confiscation.
The underlying dynamics are clear in a recent statistical release by the government. First, real urban disposable income rose a comparatively tepid 7.8 percent in 2010, despite economic growth of nearly 10 percent. However, urban retail sales of consumer goods grew 14.5 percent. While the growth of consumption is good for China's economy, the pattern of this growth suggests rising inequality.
The biggest growth in consumption included jewellery (46 percent), furniture (37 percent), cars (34 percent) and construction material (34 percent). Essentially, these are items related to the spending of the upper class. These ‘consumer’ goods also made up 33 percent of all retail consumption in China. The large size and strong growth in luxury items implies that grey income was substantial in 2010, as suggested by a Credit Swiss report authored by Prof. Wang Xiaolu.
In this report, released last year and based on a survey of urban households in 2009, Wang found nearly 1.5 trillion dollars in grey income unreported in the official household income numbers. He further found that over 60 percent of this grey income accrued to the top 10 percent of households. The latest numbers also suggest that while income of normal households likely grew at around 8 percent, the top 10 percent of households may have seen income growth above 25 percent.
A growing middle class is also absent among recent college graduates. According to the Ministry of Education, only 68 percent of college graduates in 2010 were able to find permanent employment. Even among those who found employment, wages were often no better or sometimes even worse than those for migrant workers in factories. Unlike the rest of the world, however, China enjoyed a spectacular 10 percent growth rate. This impressive growth, however, didn’t translate to high paying jobs for college graduates. In major cities, many college graduates live as an ‘ant tribe,’ packed tightly in small dormitory rooms with four or more roommates.
MTG
@John Chan
Pleasure to meet you! This is so exciting, I’ve never met a 5 mao-er before. How much does the CCP pay you for each post to spew pro-Party propaganda?
Is it still .05 renminbi? Or has it gone up with that recent inflation on the mainland?
How many 5 mao dangs do you have in your office? Last time I heard, China’s dictatorship has close to 25,000 on their payrolls.
Ali Blahblah
For discussion held on a site called ‘the Diplomat’ it seems like these comments are rather hostile.
The growing elite have spoiled rotten kids that are easily exploited. Kids’ dollars are the easiest dollars to earn. It is true that Chinese CCP engage in a lot of brainwashing and things like that, but a true democracy would be hard to run in a country of PRC’s size. The general population is unbelievably apathetic and used to being spoon fed.
As long as chinese political system can’t change, their policies will continue to benefit the ruling parties. However, do you realise how little real power the CCP have on the market. Nominal!
Individuals with formidable guanxi networks hold the real power. A lack of legal framework is the real issue with china. What little legal framework there is is badly managed and nominaly and even worse, only selectively enforced. If the CCP can revamp their current economic terrain so that arms length transactions do not carry so much risk, none of this state vs individual issues would remain. Or at least they can be solved via arbitration. At the moment, what is the chinese court system?
Helumt
@ John Chan
Do you have job…?
Cus you certainly spend a lot of time writing on this forum… you’re all over this website… where do you find the time?
Reason..
I think the point the author is trying to make is that – China is not making a substantial middle class with its new found wealth and this is the disparity issue that could cause problems in the future.
There are poor and their are rich… but not a substantial balancing chunk in between
So, citing what the US or UK does is not relevant – as they both have established middle classes.
ming
I can see mirror image in the UK! inflation is at 4.9% while deposit interest at about 2% p.a. Salary is frozen and social benefits are cut! so the average UK citizen is no better off compared to the average Chinese workers. The rich and the ruling elites in the UK are getting richer then ever before whilst the workers are getting poorer!
AW
I’m amazed on how blatantly ignorant and superficial this article is.
The author is trying to convey 2 basic messages:
Point Number One “there’s an economy that is still dominated by state owned firms and state-led investment”
This used to be true, and remains true in the Financial Services, Natural Resources, Media, Infrastructure and some manufacturing sectors (this is driven by political goal for security and stability and is unlikely to change anytime soon). However, in most manufacturing, technology and consumer sectors –it is as private as you can be by any measures. In fact, SMEs in China is dominated by the private sector.
“well-financed state owned enterprises have nationalized firms in the coal, automobile, and steel industries in recent month”
This is a BOLD claim to make? I have not heard of any nationalization of any firms in China recently. Some of the firms in the Coal, Automobile and Steel, are already partly, mostly local government, state-owned. What data does the author have to support this statement?
“Having little choice, households in China must deposit money in the state banks, and when there’s inflation as there is today, they earn a negative real interest rate from the banks because the government fixes deposit rates at a level that is below inflation.”
Just like any other countries, households in China have the choice of: (1) Investing in domestic stock market, (2) Investing in domestic bonds, (3) Investing in Real Estate, (4) Deposit in the bank. On top of this, households have the option to convert their RMB into USD or other currencies and invest their money overseas – caveat, they can only do this in limited amounts. Of course, investable assets domestically still insufficient for the amount of wealth that the PRIVATE sector is generating, and the government recognizes this and attempting to tinker with a few policies to open up capital flows out of the country for investment purposes.
Just for comparison, inflation rate in the US is 1.63% (inflationdata.com) and bank rate for checking accounts is 0.71% (bankrate.com). Inflation is in fact higher than the deposit rate.
Another related point, the government had actually asked the banks to STOP lending to the SOEs (with the exception of property SOEs). http://en.21cbh.com/HTML/2010-12-6/5MMDAwMDIwOTU5MA.html
Point Number Two “rapidly rising inequality” – Now, this is definitely true and the government already recognizes
“At the local level, local governments confiscate the other major source of wealth—land and real estate holding—often giving residents illegally low compensations. Without political accountability and elections, ordinary people can do little to change what amounts to property theft.”
Completely agreed.
After reading the article, I do wonder if the author has in fact been to China recently and had seen the wealth and consumption that the economy has generated, or whether the author is jumping on the “let’s bash China for the minuscule domestic consumption” bandwagon. Of course, as he claimed on his Point Number Two, just like any other developing countries, the distribution is unequal (a remote agricultural village versus Shanghai/Beijing for example). And I agree – this is a problem for domestic stability – but on the consumption-side, having lived in China for a few year now, I am quite confident that Chinese citizens will keep up their spending.
Peter
@ AW – You make some great points. However, the inflation issue, though perhaps common throughout the world these days, is still a very real problem.
In addition, though the author may not have visited China recently, it seems that you may be living in a bubble. I live in China and the income gap isn’t just a problem when comparing Big cities and villages. If that were the case, it might be more palatable for many. It is within cities like Beijing and Shanghai that you can see the greatest difference between rich and poor and in many villages, people are doing quite well financially.
I don’t think that a income gap is necessarily a problem, as long as the poor are getting the basic necessities. However, the misery of a poor life is most keenly felt when one has to witness the incredible wealth of the well-connected every day. That’s what many people experience in China’s cities on a daily basis. Based on my conversations with many, that’s what fuels their contempt for the status quo.
Marisa70394
I’m in the middle of reading Zero Sum Future – it’s a good book to read to learn more how China’s economy became this way. It also explains why the US is not really profitting from its dealings with China. As a country, China only thinks about how to help itself, and within China, the leaders only think of themselves. It is a very selfish place, and once China grows up and considers the benefitting the world, then we can say, “China is a superpower”. However, I don’t see that happening for a long time, even if it develops its military appreciably. China just keeps making it up as it goes along, always just trying to get by and not let the party lose power. China could better serve its people by getting rid of its rigid political system and opening up to more democratic values. Until that happen, the rich will only get richer and the poor only poorer.
John Chan
@ Marisa70394, China is only a developing nation with highly unequal economy. India is a Superpower, not China. China was forced into building up its military to defend itself by the US and its allies, which hold larger and larger military exercises along China’s coast non-stop. USA then created ‘China Threat’ to make tons of money by selling its Rubin Goldenberg weapon systems to its clients at inflated prices. It’s all a USA’s setup, Zero Sun Future is just one of the brochures for the US arms sales effort.
Johnny
@John chan Of course, it is all American Conspiracy! Heck, even Tiananmen protests were sponsored by USA and the tanks that drove over innocent students were manned by Americans! Also, America was the one who has killed millions of Chinese in the name of ‘cultural revolution’ and starved millions to death just to meet an dictator’s inflated comment. America is behind every human right movement in China and America has hypnotized every successful nation, only a couple of failed states (ruled by extremists/dictators/idiots) are free from American hypnosis. It is all part of a big American conspiracy and having an dictatorship to rule the people is the only way to save China from the Evil western hypocrites!
John Chan
@Johnny, you said it, you surely can tell better than I. The USA is behind every trouble spot in the world, now they are even sending exhausted marines from Afghanistan to Libya for another conspiracy.
Rob
Mr. Chan, can you please stick with one name. It annoying to speak English and Chinese in the same breath. And I am talking about your name. What kind of a bastard citizen uses half Engish half Chinese names.
Soul Speek
China started free market economy almost thirty years before India so you can’t compare the two countries. Though India is a late starter in this, all the economic indicators point that it will be India which will become the fastest growing economy in coming years.
harry
China 30 years ago was dirt poor, while india was MUCH MUCH richer than China at the time. and for the first 10 years of Reform and opening up it was mostly experimental economy where un profitable state owned and ran companies dominated, and it was only 1990 when China first trialed with stock exchange concept. so teh real growth of China in modern times started in late 1980s and early 1990s, so its only few years before india reformed its economy, considering the fact that india was considerably richer than China beofore, gave india more advantage, but look at now, hard evidence of well regulated mixed market and state guilded economy is better than the fake democracy and the fake “free marke” of india
Johnny
Alright harry, Chinas economy is better than india’s.
Chinese one party government is better than India’s fake democracy.
Chinese are better than indians.
Chinese are better than everyone else.
We all bow before you.
Happy now?
Soul Speek
Dont start ‘who was poorer’ debate. All world knows about it. You can confirm from any neutral source. Your statement that ‘india was MUCH MUCH richer than China’ is total fallacy and exaggeration.
I have also noticed that you are using small caps to write ‘i’ndia and large caps to write ‘C’hina. I know it is intentional and shows how you view your neighboring and your hatred towards India.
harry
india’s gdp per capita in the late 1980s were around $280, China at the time had an per capita of around $150 so yea india was much much richer than China in the 1980s. but China had to started economic development from scratch and at the time China didnt have a good reletionship with USSR Japan(two of China neighbours) or USA. so real economic development only started in the late 1980s and early 1990s. but now look CHINA’s GDP per capita is $4283, while india is only at $1176, oww why? because indians rather rather die of starvation then giving up their FAKE democracy too bad, Chinese is smart enough to have the cake first then distributed evenly, unlike india you guys count how many cake crumbs each gets, but thanks to the fake democracy you guys cant even distribute cake crumbs evenly LOL(with capital letters)
EAM
Harry, I am not sure what these 1980 GDP figures really show. Are they PPP or nominal? China even by that time was way ahead of India in health and education outcomes that in the end matter for economic growth. We forget that China’s superlative performance post 1980 was based on the foundations laid by Chairman Mao in delivering good outcomes in literacy, health, education and life expectancy (Minqi Li). It is also easy to forget that India was colonised and this meant that India did not start modernising in a full blooded way until the 1950s. Japan by contrast began in the 1870s and even China under the late Qing took the first steps and was able to begin a wholesale modernisation after the late 1920s when the Guomindang took control of the whole country. These comparisons are made by Ian Morris in his recent work of world history. The first decade of the Guomindang period is a forgotten decade in Chinese history when much as done by way of paying down infrastructure. So India does come from a long way behind but to its great credit is moving quickly to reverse the effects of the backwardness it inherited from the colonial period. Also India’s democracy is not fake but does deliver outcomes (Amartya Sen). Why do Chinese of the calibre of the late Zhao Ziyang and the PM Wen Jiabao go on the record in saying the democracy in the end is right for China?
sam
when Zhao Ziyang & Wen Jiabao said democracy is right for China, they obviously refer to democracy with Chinese characteristics. They certainly did not say democracy of the western type.
harry
I think it was nominal, but dont think ppp figure can be dramatically different. China before opening up was a mixed bag,yes its health care system was alot better than india butat the expense of personal wealth, and I doubt the education of masses before the opening up was anything constructive, take the 10 years of cultural revolution for eg. my father told me that when u get on a bus you must qoute from Mao’s little red book to get a ticket, and intellectuals weres humliated in all walks of life, anything that does not follow Mao’s idiologies must be destroyed. so the social development of China before 1980s was more advanced than india but at a great cost, this kind of level the palying field, also dont forget the “great leap forward” when people had to eat grass roots to survive.
yes india was colonized by the British but the British were angels compared to what China had to go through under japanese invasion. they used WMD, they cleansed cities raped and looted half of China for almost 10 years.
I would also question the empty modernization steps took by the late Qing courts, the reformist Emperor Guangxu was a puppet, with doweger Cixi very conservitive who had real power, its said her annual personal expense can buy China entire fleets of most advanved battleship of the time, and the lose of Beiyang fleet realy shows how weak and backward the Qing industrial power was.
Also early republican era was Warlordism and after KMT gained control of all of CHina it was a corrupt bureaucracy, with the central government have no real control in many areas, at the time KMT soldiers had to use german made gear from rifles to even helmets this indicates weak heavy industrial power. and any minimal industrializaition was destroyed in the next 12 years of fighting with japanese and civil war between communist party and kmt.
in the early People’s Republic era progress was made, but it was undone in the Sino-soviet split, the great leap forward and the cultural revolutions.
so in the 1980s when China opened up it basically had to start from scratch with no experiance with market economy and forign investment.
in reality real development in China only took off in mid 80s and early 90s, similar to when india opened up, but looking at the current status of the 2 I would say the Chinese pragmatic development model were much more successful.
Key to real democracy are the people NOT whether the country can run an election, if 3/4 of indians live in reletive poverty(among many other social economic problems) then its not a real democracy.
Nitesh Chopra
Dont say anything….Chinese are too good!!! They are world leaders… Everyone else is a fool and only chinese are growing…
But one main point…How can you write such a nice english??? You know guys, he must be an employee of chinese government to comment on their behalf and defend them. And if you will not listen to him he`s gonna hack your IP address or e-mail account. And will say loudly China is developing. So listen to him and bow before him.
Julia
Well, that is quite silly comments. Harry even uses small caps for his user name.
John Chan
Harry couldn’t put the heart and the spirit of real Democracy any better in pragmatic terms. It is way better than the empty and artificial definition put out by the West and its lackeys that they actually do not practice themselves.
Johnny
India started its economic reform in 1991 i.e. 20 years after China. This is pure and simple truth and can be verified by visiting any credible site or reading any good book.
China’s growth can’t be compared straightly to India’s because of this large time difference. You have to factor in the time period difference to get real figure.
And to the idiot who said that India was richer than China before economic reforms,
India in 1991 had a paltry reserve of $1.2 billion which dropped to 0.6 (yep zero point six) billion in march and India was on verge of collapse.
China in 1991 had $43.7 billion.
So China had an huge economic lead + two decades worth of time lead over India. So it is pretty damn stupid to say China has done better than India specially since India is growing by 9+% and is about to dethrone China from the crown of fastest developing economy. For more info see the World Bank forecast, made by some the best economic experts.
But of course, these were the credible facts and figures. Nothing can stop Chinese from posting there fabricated version of reality. LOL.
harry
as i have already said most development before 1985 were all experiments, literally speaking there were not one person at the time actually were experts on global trade and economy, were as india didnt had the ideogical restrictions on its generations prior to opening up, real development in China only took off around mid 80s so its only few years difference, NOT 20 maybe its time for you to actually read between the lines instead of just mindless copy and paste data found on wikipedia. =) little jonny boi =)
Rob
harry, I would propose that being ‘chinese’ -_-, you drop saying things like lil because it would only lead to us talking about sizes and why your women fall for other races. “boom”
Johnny
@Harry Yes some of the data I posted is from wikipedia, some from world bank, some from china’s economic reports and all of this can be verified. You think I am ‘a little boy’ for posting verifiable material???
Perhaps we should all become like Chinese and start posting whatever shit we want without bothering about truth. ‘Who needs reason and facts when you can have a mindless flame war’ seems to be the Chinese motto.
John Chan
@Soul Speek, I thought India is a democracy since 1947. Capitalism and free market economy are the expression of democracy as defined by the West and its lackeys. Are you saying that democracy in India is a farce all these years? If that is the case, are you sure India is not nation of honey words and pious gesture?
Johnny
@John Chan Had you used half of the time you waste bad mouthing USA, Japan, Australia, S.Korea, India, ASEAN, Britain and any other democracy you would know that India was a Socialistic economy till 1991. Govt had a tight grip on most business, private investment/capital formation was discouraged, imports were restricted, almost all sectors were closed for outsiders and govt. permission (aka license) were required for pretty much everything. Only after 1991 did India transformed into a open market economy and has witnessed massive growth since.
John Chan
@Johnny, India is an Imperialist wannabe nation, an expansionist to continue the extension of British Empire. Because it has no capability to carry out those inflated ambition, it is selling itself to the world biggest bully as willing lackey.
megakids
Read NYTimes 28 Feb 2011, “MUMBAI, India — Even as the government set ambitious goals, a new report showed that India’s economy slowed more than anticipated at the end of last year.”
India’s growth is structurally not sustainable. There is no advantage of having a larger population if all you have are illiterates. There is absolute disadvantage when India has such poor or non-existent manufacturing capability, which on one hand creates employment for the messes, and develop a country’s core competence in science and engineering. India has NONE!
Talk about over-taking and even a faster growth rate? By what? Don’t dream too much. It is turning into a nightmare!
fatso
in 1971,i saw a very interesting article on south china morning post , hong kong exported and imported more goods than china and india. almost 40 years later,hong kong still export and import more than one of the two countries mentioned above. guess who?
Johnny
Why not read the World Bank forecasts? Or the data by OECD and other agencies who put estimate for China this year as 7-7.5% while India is predicted to grow at 8.5-9.5%.
Oh I almost forgot The Chinese GDP figures are the world’s most inflated GDP figures because of violation of established accounting principals. Around the world the loan is NOT added to GDP but China adds the hundreds of billions $$$ of loan to its GDP. Also, if goods are made/sold/resold between different provinces they are seperately added to GDP! i.e. if province A can’t reach its goal then it will, in collusion with province B, start selling and buying same goods to each other over and over again to meet the GDP targets! These are but a few examples. I can post dozens more if you want.
EAM
There is more to this than what the article discusses. The Chinese government does appear to understand the problem and the shift in emphasis to a set of policies that favour a more equitable society does appear to be happening under Hu Jintao and Wen Jiabao. The recently announced 12th Five-Year Plan may be important in its shift from East Asian export led growth to growth based on domestic consumption – something more like India which does better on the GINI co-efficeient measuring social inequality. That must mean better standards of living for the vast majority, lower growth levels but better social outcomes See further http://english.aljazeera.net/indepth/opinion/2011/02/2011224185710593188.html
Grant
The central Chinese government might realize that they’ve got a growing problem but people seem to overestimate the ability of the central CCP to force reforms on distant parts of the country, especially when those reforms might prevent local politicians from enriching themselves.
Aside from that, this is the last year for Hu Jintao and Wen Jiabao. I seriously doubt their replacements, who will have to deal with a more assertive military and strong local leaders, will really be able to enact any large reforms (assuming that they’ll actually want to).
harry
lol who ever wrote this article is a funny guy. he calls himelf an expert yet he compare China a country who has only been industrialized for 30 years and intergrated into the modern economic system for 20 years to Western countries who has been industrialized for atleasst 100 years and kick started global teade 300 years ago. yet this so called expert make no comparason to countries who has have similar development time and population as China, namly Brazil and India, compared to the CHinese these (ELECTED NOT FORCED REGIME THAT THRIVES ON VOTING PAPERS) countries’s population are MUCH poorer. their inequality is vast even more than China’s rich and poor, so how come no one criticize or even question their method of development?? and when China pulled more people out of overty than the entire history of mankind people starts anti-china propaganda and nagging about the glass half empty in China, when you have the glass 3/4 empty in india and brazil(two democarcies and capitalists).
btw Johnny boi jasmine revlution in china is simply an internet joke, according to Melisa Chan and Aljazeera reporter based in Beijjing its simply a case of Chinese government overreacted to and empty call for revolution,
I’ll just leave with the anecdote tweeted by McClatchy Newspaper’s Tom Lasseter, who did swing over Sunday afternoon to check up on things:”Watching large crowd of cameras following around the police, young woman in Dior sunglasses asked me if there was a celebrity or something.”
Yu
I am Chinese, and I don’t feel the growth in China’s GDP has translated into substantially increased income of the masses. I guess your definition of “China” is Chinese elites. I’m offended, Harry, or is that even your name? I hope you spent that 50 cents well.
John Chan
@Yu, are you sure you are not a surrogate Chinese? If you do not agree what harry has said, just post you argument to counter harry’s argument, why do you have to copy the anti-China clique’s bad behaviour and label a fellow reader groundlessly? How do you feel to be labelled as a CIA proxy or a lapdog of imperialist westerners? And your writing is to make a 50cents pen handler fee from those anti-China clique?
John
John Chan wrote: “@Yu, are you sure you are not a surrogate Chinese? If you do not agree what harry has said, just post you argument to counter harry’s argument, why do you have to copy the anti-China clique’s bad behaviour and label a fellow reader groundlessly? How do you feel to be labelled as a CIA proxy or a lapdog of imperialist westerners? And your writing is to make a 50cents pen handler fee from those anti-China clique?”
So if someone agrees with your anti western/eastern ideology, then they are true Chinese.
If they disagree then their ethnicity/nationality is only a bad joke or they are a traitor to your ethnic ideology, is that it?
If someone called me a traitor (which is what you are doing to them) for simply disagreeing with my nations policies (which is a normal occurance in a democratic nation), then I would have two options.
1.) Ignore his opinion, because its normal that we wont all agree on what we think our nation should do and he would be a moron for stating his points so badly.
2.) Change the system and prove him wrong.
Seriously, CIA proxy, Lap dog?
Have you listened to your Governments comments on CCTV? They seem to be saying that they want to integrate with the rest of the World. You sem to be saying anyone who does is a lap dog.
Did you fail the test on how to manipulate the world pysops course 101?
I mean, if I was the Chinese Govt. I would fire you, as you seem to seek out and make more enemies than friends. :)
Johnny
What else can one expect from a non-elected, forced regime that thrives on propaganda? It is about time that Jasmine revolution is gaining momentum. Toppling of dictators is not a matter of ‘if’ but ‘when’.
John Chan
@Johnny, China leaders are elected by a Chinese style election system. The Chinese leaders are not dictators, they have limited number of terms in the office, and except every few, all people in Chinese government have to leave office by age 60. At worst you can claim China’s political system is an oligarchy.
Johnny
John Chan said- “China leaders are elected by a Chinese style election system”
This is either the joke of the year or lie of the millennium either way it is just pure, unadulterated bullcrap. Every single book by every known author, every website, every credible source of information says that China is ruled by a one party regime which doesn’t allow anyone else to fight election. No one is allowed to express opinion, no human rights, no free press, raising voice against wrong doings of government is a crime, govt controls courts!!!. I am eagerly awaiting for a proof to prove me wrong. Seriously I challenge you to prove me wrong.
Johnny
continued-
Elections in the People’s Republic of China take two forms. Direct elections occur for village councils in designated rural areas, and for the local People’s Congress in all areas. All other levels of the People’s Congress up to the National People’s Congress, the national legislature, are indirectly elected by the People’s Congress of the level immediately below. Executive positions, including the President, the State Council and provincial governors are indirectly elected by the People’s Congress of the relevant level. While universal franchise is guaranteed in principle by the Constitution, in practice the Communist Party of China maintains full control of the entire electoral process. In practice, only members of the Communist Party of China, eight allied parties (the “democratic parties”), and sympathetic independent candidates are ever elected in any election beyond the local village level.
John Chan
@Johnny, there are many political parties in China. The presidents are elected by People’s Congress which is represented by all parties as well as individuals. You can find all those details on the Internet, such as http://www.china.org.cn/english/Political/25060.htm. It is true that CCP runs the government all the time, because it is the biggest party in China. It is same in other nations in the world, like UK, USA, Japan, India, Canada, etc., small parties never get the chance to form the government, even may not be represented in the legislature.
CCP is same as all political parties in the world; members elect leaders of CCP. Not all the ministers in the State Council are CCP members.
The officials in villages, towns, etc. are elected directly by the people. The villages may have thousands or tens of thousands of people. China might have more elections than the whole world combined.
If you can read Chinese, there are numerous sites, newspapers and different media blasting wrong doings of government in China. A lot of officials lost their job or imprisoned due to the exposure of their wrong doings by the media. Regarding corruption and abuse of civic liberty, China is no different from the USA, Canada, Japan, etc. in the western world. In fact India is way more corrupted than China on the international corruption index. In the international scales measuring corruption and human right abuse, top is the best and bottom is the west, China is above the middle.
Johnny, you are a typical reader who are ignorant about China, stuck in cold war era and do not know how to get out of that time loop. We are trying our best to communicate with the world and people like you on behalf of China voluntarily for the sake of world peace and prosperity.
Open your mind and take a trip to China, you will find out how much you have been misled by the anti-China group whose motive is to destroy China for their greed, and other hideous objectives.
Johnny
@John Chan Your comment was hollow and baseless as usual. But don’t worry I have verifiable points to prove my points-
From Wikipedia-
No substantial legal political opposition groups exist, and the country is mainly run by the Communist Party of China (CPC), but there are other political parties in the PRC, called “democratic parties”, which participate in the People’s Political Consultative Conference but mostly serve to endorse CPC policies. While there have been some moves toward political liberalization, in that open contested People’s Congress elections are now held at the village and town levels, and that legislatures have shown some assertiveness from time to time, the party retains effective control over governmental appointments. This is because the CPC wins by default in most electorates. The CPC has been enforcing its rule by clamping down on political dissidents while simultaneously attempting to reduce dissent by improving the economy and allowing public expression of people’s personal grievances, provided that it is not within the agenda of any organization. Current political concerns in China include lessening the growing gap between rich and poor, and fighting corruption within the government leadership. The support that the Communist Party of China has among the Chinese population in general is unclear because national elections are mostly CPC dominated, as there are no opposition political parties and independent candidates elected into office are too scattered and disorganized to realistically challenge CPC rule. Also, private conversations and anecdotal information often reveal conflicting views. However, according to a survey conducted in Hong Kong, where a relatively high level of freedom is enjoyed, the current CPC leaders have received substantial votes of support when its residents were asked to rank their favourite Chinese leaders from Mainland and Taiwan.
The eight registered minor parties have existed since before 1950. These parties all formally accept the leadership of the Communist Party of China and their activities are directed by the United Front Work Department of the Chinese communist party. Their original function was to create the impression that New China was ruled by a wide national front, not a one-party dictatorship. The major role of these parties is to attract and subsequently muzzle niches in society that have political tendencies, such as the academia. Although these parties are tightly organized and do not challenge the Communist Party, members of the parties often individually are found in policy making state organizations, and there is a convention that state institutions generally have at least one sinecure from a minor political party.
The minor parties include the Revolutionary Committee of the Chinese Guomindang, founded in 1948 by dissident members of the mainstream Kuomintang then under control of Generalissimo Chiang Kai-shek; China Democratic League, begun in 1941 by intellectuals in education and the arts; China Democratic National Construction Association, formed in 1945 by educators and national capitalists (industrialists and business people); China Association for Promoting Democracy, started in 1945 by intellectuals in cultural, education (primary and secondary schools), and publishing circles; Chinese Peasants’ and Workers’ Democratic Party, originated in 1930 by intellectuals in medicine, the arts, and education; China Party for Public Interest (China Zhi Gong Dang), founded in 1925 to attract the support of overseas Chinese; Jiusan Society, founded in 1945 by a group of college professors and scientists to commemorate the victory of the “international war against fascism” on September 3; and Taiwan Democratic Self-Government League, created in 1947 by “patriotic supporters of democracy who originated in Taiwan and now reside on the mainland.”
Coordination between the 8 registered minor parties and the Communist Party of China is done through the Chinese People’s Political Consultative Conference which meets annually in Beijing in March at about the same time that the National People’s Congress meets.
In addition, there are a few minor parties which are either unrecognized or actively suppressed by the government, such as the China Democracy Party and China New Democracy Party, which are deemed to be politically subversive. Due to the censorship and suppression, they mostly have their headquarters outside of the Chinese mainland.
So it is YOU who is blatantly unaware of truth. Please don’t post without any knowledge of topic at hand.
John Chan
@Johnny, even you admitted that there are political elections in China, and the presidents of China are elected. Your long-winded comment only said that China’s election system was not to the liking of anti-China clique. It’s well known that the anti-China clique uses the western format of election as a front for the tool to break up China and to achieve other hideous means of enslaving Chinese like the days in the era of unequal treaties.
China will implement democracy with Chinese characteristic. It emphasises on the essence of democracy not to the compliance of western democracy which emphasises on formality only, the western governments break the spirit of democracy by legislative means routinely, blatantly abuse civic liberty by the homeland security is one prominent example, and holding emergency session to pass laws in an hour without public or parliament debate is another trick to violate the essence of democracy.
Johnny, you are the one “who is blatantly unaware of truth. Please don’t post without any knowledge of topic (democracy and liberty) at hand.”
Anyhow this article is about economy in China, it is not about the political soundness of China, you are way off the course of the debate, you just use any chance available to demonize China because of your blinding hate of China. China can stand up to your mean spirited assaults and move forward.
Johnny
Perhaps I should have posted a small passage as you can’t seem to comprehend it.
CPC has some lapdog parties under 100% control to support its view. Any other party except these lapdogs is immediately declared hostile and is forced to flee from China. No one is allowed to stand against CCP over village level and CCP controls everything. Even the law courts are directly under CCP command.
In short the political system doesn’t allow ANY OTHER PARTY THAN CCP TO EVER STAND UP. How is that a fare election?
And for gods sake stop posting white lies. It reflects badly on your culture.
John Chan
@Johnny, as I said, Chinese are here to correct the lies told about China, clear the smear painted on China, and tell the truth over the fabricated facts about China. Your anti-China propaganda is the one we try to overcome.
Johnny
@John Chan Again an pointless flaming comment. If my sources are wrong then why not you post your own sources to prove me wrong?
And no, you are not here to correct lies about China. You are here to spread lies about China and CCP. Same CCP who is working against Chinese people (not counting CCP politicians, govt. officers and relatives of CCP members) by taking away human rights, freedom and equality. You don’t post for China, you post for CCP.
Haiyan
In my own opinion. Both of Johnny and John Chan are partly correct in interpreting China’s political system.
The fact is this country has no serious governmental system, election system or judical system. It’s a hybrid.
Before 1953, there was a premature democratic governmental system firstly led by KMT and then led by CCP. But in 1953, the interim Constitution ‘Common Program’ was abolished. A new version of Constitution was enacted mainly bearing the thoughts and claims of CCP.This Constitution effectively established a CCP dominated oligarchy government.
In 1957, the Anti-Rightist Movement initiated by President Mao marked the beginning of a series of political movements towards purified goverment & society, which muted all oppositional forces outside CCP.
Then President Mao gave out his governmental position to his fellow comrade Liushaoqi, but still ruled as Chairman of CCP. Soon, he found himself in embarrassed situation. The CCP in the government led by President Liu was going out Chairman’s control.
Well, Chairman mao didn’t take back his governmental position from Liu, which might expose his embarrassment. He simply chose to destroy the Constitution and the Government. He even publicly said ‘I don’t remember what Constitution says’. The president Liu was beat up even with a printed version of Constitution in his hands and had been claiming he was protected by the Constitusion. During 1966~1976, Mao succeeded in taking back all powers by manipulating grassroots to overturn govermantal system in China.
From 1966 to 1982, China had a party-ruling system instead of government-ruling system, which was duplicated in Libya by Colonel Gaddafi using relatives and friends to act as party members. Mao was the dictator and Deng was the next. All power belongs to our people, they kept saying. But actually, no power leaked outside their small political circles in CCP.
In 1982, a new Constitution was formed to re-establish govermental system in China to offer a cover to quarantine all blames towards CCP itself. But party was still the ruler, whose power was exposed in 1989. President Zhaozhiyang was abolished by CCP tycoons, not by the nominal governmental Congress.
After 1989, the governmental cover and the CCP power entity merged through organizational arrangements. The top positions of CCP and the top positions of China government mingled.
That’s why Johnny and John Chan are both partly correct.
Is China government a dictatorship?
Not anymore. Because there is a election system in governmental system that avoid one-strong-man-type dictatorship created by Mao.
Is China politics a oligarchy pattern?
Not yet. The real powers are in monopoly CCP. No one else can share it, no matter how wealthy or influential they are. Anyone aims the political previliges has to join in CCP and take part in CCP power communities.
How about the election system in rural areas?
Generally a joke. All powers sterm from CCP system not election system.
How about the new trend of China politics?
Well, many many offsprings of early CCP leaders now possess the power communities of CCP and take important governmental positions after have made a lot of money using their advantages of being politically previliged. There is a trend that China is becoming a oligarchy country because the power of new generation CCP leaders stems not only from inside of CCP but also from where they earn their wealth. Different power foundations will differ the CCP leaders and diversify the power distribution of China.
Future China will be ruled by a hybrid of some CCP leaders whose parents are ex-leaders of CCP,non-CCP individuals behind CCP leaders and a small part of governmental leaders who’ll be elected by either CCP or governmental Congress.
Nothing will change to Chinese people if a true democratic system doesn’t exist. Some day, may be CCP will be obsolete as a power hive due to too many historical evils. However the ruling families will remain active and dominant.
In fact, present premier Wenjiabao has a nickname given by Chinese people, ‘yingdi’, literally ‘best actor’ like those winners of OSCAR.
LOL, Chinese people know everything about this wierd political system but still hesitate to make any change. They don’t like revolution anymore. Because last time, the most revolutionary figure Chairman Mao manipulated all sincere revolution supportive people.
They are afraid of being defrauded by another ‘revolution’ party like CCP.
That’s why China Jasmine Revolution is going so much cry, little wool.
That’s why few Chinese people care about the inprisoned winner of nobel peace prize 2010, Mr. Liuxiaobo.
Chinese people are in some extent political indifferentism or nihilism due to severe hurts in past social movements.
Nowadays,what we concern is money, money and still money, until being hurt by local political power personally.
Many younger Chinese people are very unsatisfied with current state structure, but few of them are naively think of taking part in a revolution.
PS: The ’50 cents’ appears in Yu’s reply refers to ‘the 50 cents party’ hired by China CCP&Gov to argue for them in cyber society. They get paid at a rate of 50 cents CNY per post many year ago and now 4 times, that is 2 CNY due to inflation ^_^
And their opponents mainly Chinese liberalists who admires USA or western patterns and criticize CCP&Gov are tagged by ’50 cents party’ as ’5 cents party’. There was a rumor that CIA hires these people to assault China CCP&Gov at a rate of 5 cents USD per post, about 40 cents CNY years ago and nowadays only around 30 cents CNY.That’s a great depreciation if the rate hasn’t changed. LOL again.
Maybe I made some grammar mistakes but I tried my best to depict China political system through an educated Chinese white-collar point of view.
Hope you guys like the freshness of an authentic China common person’s post.
Rob
John Chan, I dare you post a message critical of CCP on their forum or in a newspaper editorial published within China. If you can’t then stop putting defense of authoritarian rule of CCP. And as for your comments about India begin ruled by one party, you need set some time aside from spreading CCP propaganda and read about Indian Political System. We’ve got bicameral system and a majority of states are being ruled by regional poitical parties independent of the party at the center. We are now fighting against corruption and probably take a few more years to clean the system but I dont see any progress in your country where CCP has the rule of law. I am critical of politicians and several systems of India but your are living in denial by rejecting the facts critical of your country’s regime.
Peter
@ John Chan – Your comments are an embarrassment to yourself and your nation.
megakids
What have you contributed to this discussion forum, other than bad-mouthing and spitting our your ideology?