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In the current Chinese Media, the "Harmonious Society" or "Hexie Shehui" is the second most known phrase aside from phrase "Better City, Better Life" in the World Expo. From the upcoming Asia Olympic Games to the lectures of my Emerging Markets class, the word "Harmonious" has been heard everywhere in China. Ever since it was endorsed in October 2006 by the Hu-Wen Administration, the "Harmonious Society" has been the future socio-economic vision for China. Its main goal is to provide domestic, social, and economic stability. It aims to narrow the income inequity between the urban and the suburban population as well as the wealth gap between the inner and the coastal provinces. The vision of a harmonious society has significantly shifted the communist party's focus from promoting all-out economic growth to solving worsening social tensions. Through primary and secondary research, I couldn't agree more with James Fallows about China's current pursuit for the harmonious society.
In order to create a harmonious society, the government must improve the lives of migrant workers and farmers. As seen in the recent years, the government has taken many corrective policies to improve the standard of livings for both farmers and migrant workers. They liberalized the hukou rules to allow more migrant workers to stay in the city, provided tax cuts, and increased subsidies for the farmers in rural regions.
China: An Unharmonious Society
Ironically, China, a communist country that follows the socialist regime has a two class system in which the minority, urban residents, controls the majority of the wealth. The majority of poor people in China are farmers and migrant workers. Most of them live in suburbs and non-coastal provinces of China. According to the National Bureau of Statistics of China, about 728 million Chinese live in suburbs and about 572 million Chinese live in urban centers. On average, an urban resident has a GDP per capita of $4000, while a rural resident only has a GDP per capita of $500(Shi, Oct 5). The Gini coefficient measures the income disparity in a country. In 2009, China has a Gini coefficient of 0.47, which is the second highest in Asia after the Philippines ("Human Development Report 2009 - China." 1). These statistics show that China is, economically, a very unharmonious society. Therefore, despite the fact that China has the second highest GDP in the world, it is still mostly a poor nation full of poor people and a lot of them are constantly on the move.
Harmonizing the gap between migrants and urban residents
Every year 140-200 millions of migrant workers are on the move, which amounts to more than 10% of China's total population. They are also known as the floating population. The majority migrate to cities such as Shenzhen, Beijing, and Shanghai to do the work that is considered too dangerous, dirty, and difficult physically (3Ds) for the urban residents. During my first study break, I interviewed a migrant worker named Xu WangYu who was fixing my shoes at the back gate of ECNU. I asked him why he chose to leave his home town. He told me that after he graduated from his elementary school he was unemployed. His parents didn't need him at the farm and the only way for him to make money was to work in the city. He told me that he makes around 800 kuai per month, which is two times as much as what his parents make.
What was preventing them from working legally?
The inflexibility of the hukou, the household registration system in China, is a major institutional barrier in preventing rural resident from legally taking urban jobs. Started in 1968, Chairman Mao implemented the hukou system to restrict people's movement so that farmers could pay taxes to fund the industrialization in urban cities. In the past, it was considered a crime if a person leaves the area where his/her hukou was based. People with rural hukou don't experience the same level of healthcare, education and social insurance benefits as urban residents do in many cities.
My father said: "If you were born in the rural area, you are basically condemned for life." The migrant worker was not allowed to live or work in the city and his/her kids are not allowed to go to school in the city. The only way for you to change your hukou is to either marry someone with an urban hukou or go to college in the city and try to find a job that will sponsor for your hukou. The hukou rules make it difficult for the migrant workers to break out of the vicious cycle of poverty.
What has it been done to eliminate this problem?
Under the vision of Hu-Wen Administration to achieve a harmonious society, the hukou system was made more flexible. For instance, now, a migrant can change his/her hukou by investing in an urban real estate. Furthermore, in cities like Shanghai, if a migrant has lived in a city for more than 7 years with a stable job and has been paying taxes, he/she is eligible to receive an urban hukou (Shi, Oct 5). In addition, the government made policies so that hukou is no longer needed. For instance, a migrant worker is able to work in the city with a temporary work permit. With a temporary work permit and a renting document from the landlord, a migrant worker can attain a temporary residency card from the police station. In 2007, the new administration allowed children of the migrants to attend migrant schools in the city under the condition that they passed all the tests required (Shi, Oct 5). Now, with hukou liberalized, people can get medical care and send their children to school without having to return to their "official" residence back in the countryside (Fallow, 257). The current plan to develop a harmonious society has certainly been shown in the recent effort to bridge the economic and social gap between migrant workers and urban residents.
Harmonizing the gap between suburban and urban residents
The heart of China is in rural area. Back in 1980, 80% of the population lived in rural area. Ever since the Mao era, the central government has been using the taxes paid by the farmers to fund industrial development in the city. Not only were the farmers very poor, but they were also burdened with taxes and fees. In 2005, the Hu-Wen administration abolished the thousand years old tax entirely. Besides the tax exemption, the Chinese Government also created favorable agriculture policies to improve the economy in the rural regions and boost incomes for the farmers. This includes direct subsidies for farmers who purchase grain growers, enhanced crop strains, and heavy agricultural machineries ("China to exempt all agricultural taxes in 2006, premier." 1).
In 2004, they also enacted the "Number One Document" for farmers. The government followed this document by protecting farmland from illegal confiscation, supporting farmland environmental projects, and funding for agricultural research. Because of Hu-Wen's "Number One Document" policy, peasant earnings increased by 7% in 2004, and the production of grain increased by 9.1%. This is all the result of 30.4 billion RMB tax cuts, which exceeded an original goal of 24 billion RMB and 45.1 billion RMB in subsides. 25 provinces, autonomous regions and directly administrated municipalities eliminated farm dues altogether. In the fall and winter of 2004, peasants expanded grain acreage by more than 20,000,000Â muÂ (3,294,738 acres) ("The meaning of China's new agriculture policy", 1).Â In 2005, Official statistics indicate that these preferential policies brought 45.1 billion Yuan (US$5.4 billion) in direct economic gains to 900 million farmers in China (" Agricultural tax to be scrapped from 2006 " 1). This once again shows the central government emphasis on creating a harmonious society.
In 2010, we have already seen the progress in narrowing the social and economic gap between the urban and suburban citizens in Chongqing. This July, the Chongqing government changed a major policy that will turn 10 million farmers into urban residents by 2020. As of the end of August, about 45000 residents in Chongqing had switched their rural hukou to urban hukou. Surprisingly, some villagers stated that the social welfare benefits in rural areas are actually better than the ones in urban areas. Chongqing residents have been granted 21 social welfare benefits which include cash rewards for conforming to the family planning policy and cash subsidies for electrical appliances. On the other hand, urban residents are only granted approximately 10 social-welfare benefits ("Farmers in Chongqing say 'no thanks' to hukou" 1).
When talking with residents in the Wenquan Township, the Global Times found out from Xiong Kaisheng that he is "familiar with the rural way of life and could raise [his] family by working on the farm". He continued by saying that "if he became an urban resident, he would be stripped of the right to use his farmland within three years" Xiong said Education and medical treatment costing more in the city also scare Xiong of becoming " an urban man"( "Farmers in Chongqing say 'no thanks' to hukou" 1). This again shows China's central theme of pursuing a harmonious society by narrowing the income and social gap between suburban and urban residents.
In conclusion, as we have seen over the past few years, the central government has definitely succeeded in moving towards its goal of building a harmonious society by improving the lives of migrant workers and farmers. Because of the vision for a harmonious China, the government has significantly enhanced its poverty-relief strength and its financial investment to really improve the conditions of poor families. In recent years, we have seen that China's economic growth has brought 300 million people out of poverty. By narrowing the inequity in China and enlarging the size of the middle class, China has definitely moved closer to its vision of achieving a harmonious society. Despite the fact that China has made great improvements in terms of the migrant workers and rural farmers, they still have a long way to go until they fully reach a "harmonious society".