Reality of China

Reality of China: A Mess of Wanton Graffiti Drawn with the Pen of Power
By He Qinglian on November 3, 2011

I remember when Mao Zedong came to be the ruler of China, he described the country as a destitute state, a sheet of blank paper on which the newest and most beautiful picture can be drawn. After that, for three decades Mao Zedong ruled and he left on China his powerful drawings, done in a manner that was willful and wild. In the three decades that followed, officials at various levels at the central and local governments have been painting the country with a host of methods at will. Now, with little white space left, the drawings on the blank sheet of China are testing the lowest limits of human esthetic values and moral principles.

Is China rich or poor?

This is probably the first question that baffles international observers. Up to now, China has yet to take the initiative to wave goodbye the status of a developing nation, even though the size of its economy is large enough to be dazzling: it’s the second largest economy by GDP ranking, and has $3.2 trillion in its foreign reserves. The government is so unbelievably wealthy—the wealthiest among countries across the globe given the fact that it takes away a third from that staggering volume of GDP—that not long ago, the European Union, an important member of the club of wealthy nations, has wished that China would take out one trillion to help save it from crisis. But it is also true to say that China is poor, as there are still over 150 million people living under the absolute poverty line, being able to spend only a dollar per day. This is what I called as “wealthy government and poor people” years ago.

Even in countries which autocratic regimes that have collapsed during the Arab Spring this year (2011) such as Tunisia and Libya, the social welfare there were different from China, those governments didn’t take away as large a share from the GDP as Beijing does, and the welfare for the impoverished were much better than in China.

Current situation in China's challenges a variety of economic theories

The role China plays in international economic landscape defies accurate pinpoint of its status. It’s true to say China is a developed nation, since at least China’s commodity prices, be it viewed from purchasing power parity or other criteria, or when it comes to the prices of housing, oil or meat, milk, grain and vegetables and other daily consumer goods, have surpassed the world’s number one, the United States. The only difference is China has yet to be able to export high technology goods like all developed nations do. But it's also not wrong to say China is a developing country, as it now exports neither resources nor produces. On the contrary, it became the world’s largest importer of resources and food. Apart from rich countries like Canada, Australia and poor countries in Africa and Latin America which have to provide China with all sorts of mineral resources, the world’s number one, the United States, also has to export to China maize, soybeans, pork, unpolluted fish, and even rice. If viewed with the dependency theory, which the Leftists and the Neo-Leftists see as the bible, the countries mentioned above, whether they are rich or poor, have all ended up as vassals of China’s economy, allowing China to extract the remainders out of them.

What sort of position does China want in the international economic setting? I recall that thirty years ago when China just opened its market, it was very ambitious. Wholeheartedly determined to exchange the market for technologies so as to change the situation that numerous pairs of sports shoes were exported before a Boeing jet could be purchased, the country saw the export of low-end production like labor-intensive processing as an expedient measure, and it obtained intellectual properties by such means as stealing and grabbing—practices that deeply annoyed countries like the United States and Germany, which could do nothing.

The Chinese government had at a point seen industrial restructuring as a direction. The public was very excited about it. And what happened? Up to now, not only has the government failed to shift the industrial structure to one that is technology-intensive, but it also degraded into inferior products the labor-intensive goods like toys and electronic products which in the past had the largest share of the world’s market. Now their market share is shrinking fast.

It would not be right to say China’s falling behind in technologies, as the country has in successive years sent into space rockets including Shenzhou-5 and Shenzhou-6; it even sent up a spaceship, Tiangong-1. Despite all these achievements, the country just wouldn’t produce milk powder that meets the standards for the people to consume. In the end the problem was set aside by lowering the milk powder standards. And it seems China willingly turns its land into a shelter for polluting industries. China’s coal mining, chemical industries, metallurgy, production of electricity, of construction materials, of electronics, and light industries are where high occurrence of occupational diseases have been logged; over 200 million people are exposed to the hazard of occupational diseases. Although there has been a swift increase in the international market share of several products, such as petrochemical products like PX (the amount of which produced in China topped the world since 2009, and accounted for nearly a quarter of the world's total production in 2010) and rare earth, their production process caused severe pollution. As these industries became the pillars of China's economy, protests against pollution gradually became the third largest category of mass incidents in the country. All that's left as China's advantage, it seems, is that [the government] couldn't care less about pollution. [Sadly, all those environment experts who have been to China for field studies would realize the country's environment has already collapsed.]

China's current situation also challenges the macroeconomic theory. It's not wrong to say the country is growing fast—at a rate that is unrivaled in the world's economic history. China has proudly said to the world that it maintained the growth rate at above 8% for nearly thirty years in a row, which is a record that no other country has ever been able to keep. According to the traditional macroeconomic theory, economic growth is bound to promote growth in employment and consumption, as proven by years of economic development in countries like the United States and European Union member states. But China's situation has been very unique. Despite a growth rate this high, growth in employment and consumption were not boosted. The growth rate for employment has been hovering at 1-2% since the late 1990s, and consumption rate (consumption to GDP ratio) has been falling year after year and dropped to 37.3% in 2009, lower than the world's average of about 40%. This gross mismatch in China's macroeconomic data presents serious challenges to the macroeconomic theory that was originated from the West.

In sum, there is no readily available theory that can explain the current economic situation in China. It's also hard to categorize China as a developed nation or a developing one according to existing standards. And China actually quite like this ambiguity, which enables it to flexibly shift its status. When the country needs the power of discourse, it would identify itself as a developed nation; and when it wants to shrink from duties that it is expected to fulfill, it would call itself a developing country.

Testing the lowest limit of human political ethics

If it is said that the achievements made in the first ten years of China's economic reform in the past three decades relied mainly on the devolution of power, the development of diverse forms of ownership, and the promotion of state-owned enterprises reform, then through what channels exactly did China obtain its stunning accomplishments in the two decades that followed?

If you ask the Chinese what is the pillar industry in China, undoubtedly most would say that it's the real estate. I'd add another answer to that question: resource industries, or mining industries which is dominated by coal mining. In my article published in 2008, “Three decades of reform: abnormal development of national capacity and its consequences”, I made it very clear that since the mid-1990s, China's economic growth has relied mainly on such major sections as real estate, mining, and capital markets like the stock market; and it was from these areas that the government has been extracting resources. The real estate development provided local governments with massive tax revenue, it also gave birth to a large number of real estate rich, over 120 million landless peasants, more than three million city-dwelling households which fell victim to forced eviction and the world's highest property price.

The GDP the mining industries contributed to China became known as “blood-stained GDP”. No one could tell how many miners had their health and lives devoured by the industry that gave rise to a new one which exists in nowhere else: the industry of “pig slaughtering”: individuals who had no humanity left in them enticed others into working as miners, and then set up scenes of accident to take the lives of those miners when opportunity arose; afterward, they blackmailed the mine owners for compensation by claiming to be relatives of the victims. These cruel incidents repeatedly occurred at Chinese mines in recent years.

These two pillar industries were founded on the sacrifice of the right to live of countless Chinese. Incessant incidents of self-immolation and protests across the country could not stop local governments from carrying out forced demolition and eviction [to make way for new property projects]. And the tragic story of a worker who contracted severe pneumoconiosis was forced to ask a surgeon to cut open his chest to prove that he was not infected with tuberculosis so as to get the compensation he deserved would be something that happened only in China. Recently, Guangming Daily published an article stating that every day twenty administrative villages disappeared in China, and expressed its worries that people would no longer grow crops. Yet what I saw was peasants with no land to farm on, no prospect for employment and no place to go were being produced in bulk each day. By now there are, as I calculated, about 130 million such peasants.

By making use of the power of the regime to plunder from the people living resources and health, [the culprits] could as well be seen as presenting powerful challenges against the lowest limit of human political ethics.

Challenging against the lowest limit of human ecological safety

What have become of the sky, the earth, and the people, which were seen collectively as the “three powers” in traditional Chinese culture?

The Sky. It is said that most cities in China could no longer see blue sky, which has long been covered with haze and smog. According to the estimate by the Chinese Academy for Environmental Planning, more than 400,000 people died from air pollution-related diseases in China each year. In 2006, a report by the World Bank put the figure of such deaths at 750,000, and was lowered to over 400,000 at the request of the Chinese government for social stability reasons.

The earth. It has been devastated beyond repair. I'm not going to enumerate data relating to water pollution and land contamination here. After the mudslide in Zhouqu, Gansu last year, the Chinese government has finally admitted that the calamity was resulted from nature's revenge on human for over-exploitation. The China Institute of Geological Environmental Monitoring revealed data that suggested the land on which the Chinese people live is no longer safe: a total of 26,009 geological disasters was recorded from January to July in 2010, nearly ten times as many during the same period in 2009. A total of 200,000 potential geological disaster points has been discovered nationwide. Among them, 16,000 are classified as large and extra large potential geological disaster points similar to Zhouqu. Blood-stained GDP is getting difficult to sustain. According to official figure, there are already forty-four cities depleted of their resources. The major coal-producing province of Shanxi has up to 10,000-plus square kilometers of mined-out underground area, above one-tenth of the size of that province. Collapse has occurred in more than half of that mined-out area.

The people. Their overall health conditions are not to be optimistic about. There are hundreds of cancer villages across the country, the number of people suffering from all kinds of occupational diseases is as many as 200 million, not including those living with HIV, tuberculosis patients, hepatitis B patients, and 120 million hepatitis B virus carriers. The Chinese authorities also said that over 100 million people are mentally ill.

And as early as 2005, the Chinese officials announced there were in total 180 million ecological refugees.

A “blank sheet” on which wanton graffiti has been made

A man without modern concept of wealth, Mao Zedong said in the early days of CPC establishment of its rule that China was poverty-stricken. He did not see the land of the country, its water resource and environment as nonrenewable resources most valuable to humankind.

In fact, it was the ecological resources left behind by the old China—the poverty-stricken state in the eyes of Mao Zedong—that supported CPC rule for over sixty years, in particular the rapid economic growth in the past three decades. The land resources supported the real estate development; the water resources supported hydro-power projects like the one at the Three Gorges; the various underground mineral resources contributed to all kinds of blood-stained GDP; and the historical and cultural heritage resources gave rise to booming tourism. Just look at the land resources alone as evidence, in the twenty-one years from 1989 to 2010, the government revenue from land sales ballooned from 447 million in 1989 to over three trillion in 2010, that's a 6732-fold increase, and with that the proportion of revenue from land sales in local revenue has been rising in tandem. In 1989 revenue from land sales accounted for only 0.24% of local revenue. In 2010, the ratio reached 74.14%, a 308-fold increase. The governments have also become unprecedentedly cunning in extracting land values. Although the housing property for those dwell in it should be valid for seventy years, some of the local governments have already used housing quality as an excuse to order advance demolition and eviction. They even collect a mandatory renewal fee twenty years after the dead were buried in a grave.

The biggest difference between this dynasty and those of the past is that: at the times of those dynasties , technological advancement was at a limited level. As a result, the natural resources remained intact even though the dynasties were toppled. However, during the sixty-odd years of Communist rule, in particular the more recent three decades, huge progress has been made in science and technology, providing the technological means for extracting all kinds of resources to depletion. As a result,
the “blank paper” seized with guns is now plagued with various dirt marks that one would rather not looking at, dirt marks left on it by officials at various levels according to their esthetic ability and needs.

If it is said that over sixty years ago the Nationalist government left behind in China a “poverty-stricken” blank sheet, the various ecological resources were intact nonetheless. In its pursuit of development at the expense of ecological resources however, the CPC would leave behind for future generations a wild mess laden with all sorts of graffiti and dirt marks, and there would be no materials left for them to paint with.