by Guy Sorman
Reason number three: the peasants overestimate the profits of the village enterprises because “they don’t have any knowledge of accounting.” These collective enterprises, numerous in the countryside, provide the peasants with additional employment, and the redistributed profits improve their quality of life. But the cadres alone know what the real profits are, if there are any at all. Feeling cheated, the peasants protest. Privatization is the Party’s answer. Dang Guoying thinks that this should resolve all conflicts. How? Privatization in urban China is a strategy to let Communist cadres become the private owners of the enterprises they oversee. There is no reason for things to be different in the countryside. In theory, the conflict will be resolved. Socialist enterprises will become capitalistic ventures, with owners and workers instead of cadres and citizens. They will not be the Party’s responsibility any more.
Reason number four: property. Peasants whose lands are expropriated by real-estate builders and industrial entrepreneurs receive barely any compensation. Often, it is simply an affair of land-grabbing. In the future, the central government will ensure that the peasants receive compensation reflecting the real value of the land. The problem, however, according to Dang, is the peasants’ profligacy. “They waste the money they get on banquets, gambling, and women, and end up bankrupt without any work.” There may be some truth to that.
The fifth and last reason, and the most decisive, says Dang Guoying, which encompasses the other four, is that cadres do not carry out central directives with enough devotion and efficiency. The center is just and fair to all peasants, but its local representatives need to mend their ways. The Party schools are working at sensitizing Party officials to the condition of the peasants. A greater awareness on their part will remove the reasons for revolt.
That peasants are capable of having their own opinions, expressing themselves, being represented, and communicating with Communist cadres has not been considered. In the Party-State, there is no room for dialogue and consensus building. The center knows what is good for the periphery, the top order for the bottom order. Good officials of a good party make for a good government.
I mention the rumors I hear: there are peasant organizations in Zhejiang whose leaders are ready to talk with Party representatives. Dang Guoying is dismissive. “We know about the existence of these plots,” he says. Any form of organization outside the Party is a plot.
Dang Guoying’s approach will not put an end to the mutinies. But will the mutinies amount to a revolution? It is difficult to say. With the police, militia, and army at its command, the Party can break up the riots at any time. In doing so, however, it may well revive the taste for violence among both those who revolt and those who repress it. From a cynical point of view, the mutinies serve the Party’s purpose, strengthening the central state and reinforcing the Party as the sole guarantor of order.
Will the communists become socialists?
Early October, and it is autumn in Beijing, the time of the national day, holidays, and a “golden week.” The light is softer, the weather milder, there is less dust and smoke, and the pollution no longer hides the mountains that shield the capital from the northerly winds. It is also the time for good resolutions. This year, in a sudden about-face, the country’s leaders seem to have taken note of the terrible injustices creating rural-urban disparities, with a prosperous urban China and an impoverished peasantry. For a moment, it seemed as if a social-democratic revolution was in the offing, at least on paper.
It all began on the national day, with the head of state paying warm tribute to “the migrants without whom China could never have developed.” At last, the nameless, dispossessed migrant worker was being given a human face. A new five-year plan for 2006-11 was released, the eleventh since the constitution of the People’s Republic. There has been a change in vocabulary, though. It is no longer called a plan, but a “program.” The “program” emphasizes the primary role of the market economy, with public intervention playing a secondary role. It fixes a new goal for China: harmony, a vaguely Confucian term for restoring parity between cities and villages, peasants and town dwellers, rural and industrial provinces, the center and the west. After the humiliation of the past twenty-five years of “reform,” the peasants will, within five years, have access to schools, health, and prosperity. An ambitious program indeed! How does the government intend to achieve these goals? The program states that it will act “scientifically.” Official commentators like using this word. What is a scientific program? It suggests the opposite of revolution, a desire to break with the past. This is the explanation given to those who hanker for the state-controlled economy and other great leaps forward of the past. But how is a scientific economy going to address the concerns of the poor when the market is free and the state is curtailing its own role? Once again, the solution is scientific: the New Harmony will flow from democracy.
Democracy: has one heard correctly?
In the same month of October, a decidedly revolutionary one, the Communist Party also brought out a lengthy white paper on democracy in China. It was an emotional moment for me when I began reading it. At last, I thought, the government had shown the courage to denounce its own tyranny, to support free speech and pluralism. What followed was a complete letdown, which I should have expected.
The white paper was released in English at the same time as the Chinese version, proof that it was intended as much for Western consumption as for the Chinese people, who paid scant attention to the event. Written in official language, the white paper is merely a catalog of all the Party’s achievements since 1949. There is not the slightest trace of remorse. China does not need any lessons in democracy from the world, it states. Democracy exists in several forms: bi-party, multiparty, and single party. China has a higher form of democracy because a democratic party, the Communist Party, is at the helm of affairs. The Party is democratic because free discussion is encouraged within it (though not outside of it). China is a democracy because the people chose the Party of their own free will ... in 1949, and because the Party wields power only to serve the people. At no point does the white paper consider the possibility of curbing the Communist Party’s monopoly. It does promise that local elections will give greater power to village and area chiefs to implement Party policies.
The celebration of migrants, a promise of social harmony and scientific economics, and the rhetoric of democracy were all part of the customary autumn ritual. Was there nothing new under the Beijing sun? Liberal activists in China didn’t bother to hide their skepticism. Yet the Western community in China—the press and company strategists—has more faith in the Party than the Chinese do. In order to justify their continued presence in the country, most segments of the Western community are always ready to be cheerleaders and hail the Party: after all, it has conceded the existence of social injustice, peasant revolts, and the popular demand for democracy. The economic reforms begun in 1979 would necessarily lead to “political reforms.” The Chinese president and his prime minister were genuine reformers, well-informed and courteous, and resisted, alas, by Party old-timers. The very same analysis was applied to the “favorable” developments in the Soviet Union before it crumbled. But, unlike the Soviet Union, the Chinese Communist Party is at the peak of a prosperity curve. So why should it undertake reforms that would weaken it? Had it been part of a democracy, the Party would have built schools and dispensaries to achieve its mandate. But since it does not have to face elections, there is no incentive to divert profitable industrial investment to social infrastructure, where the returns are slow. And the Party is not in the habit of altruism. So how can one believe the neo-Confucian, Marxist ideology spouted by leaders who have advanced themselves through sheer cruelty and cunning? Ding Yfan, a political commentator close to the establishment, attempts to provide a more compelling reason. His job is to woo skeptical Westerners visiting China. He says the Party will implement its social agenda because, shaken by the peasant revolts, it fears losing power. But the Part
y is not known to act out of enlightened self-interest, and fear is not a wise counselor. Economic considerations far outweigh any concern for social harmony. More than Confucius and Machiavelli, Marx provides a better explanation for why the Party will not change its line.
The impossibility of reforming the Party
The nascent national power of China is based on its high growth rate, achieved through the exploitation of rural labor by firms geared for the world market. Any change in this system would require at least partial reconversion to the domestic market. The government would have to invest in rural education, health-care, and transport services, investments that have a long gestation period. As a result, the growth rate would go down mechanically. Now the Communist Party has no popular base. It derives its support from a class of civil servants and army officers. Would they accept a drop in income in the name of social harmony? This seems unlikely. The Party is a prisoner of its base, of the political and economic system it has created. Any change would be suicidal.
The so-called social-democratic revolution of October 2005 ended in a typically Chinese way. At the same time as the announcement of the scientific program for harmony and the release of the white paper on democracy, a Chinese rocket carried two astronauts into space. The Chinese president monopolized the television screen, congratulating the astronauts at the time of takeoff, during their flight, and upon their return to Earth. “The whole world marvels at China’s success,” trumpeted the headlines of Chinese dailies. Yet for the price of one rocket, hundreds of schools and hospitals could have been built. There would have been greater harmony, but the world might not have been as impressed.
During the same month of October, near Guangzhou in the small southern town of Taishi, 2,000 inhabitants demanded the resignation of the notoriously corrupt village chief. They had signed a petition, the legal method for registering protest. The chief reacted by sending militia, hired by the Party, to pummel the signatories until they withdrew their petition. In December, in the same province, the most prosperous in China, the Dongzhou shoot-out occurred.
Looking ahead, what does the future hold for China? Do the growing number of petitions and demonstrations indicate the beginnings of a civil society? The appearance of new militias, brown or red shirts, the police’s lack of hesitation to fire on crowds—are these ominous signs? As long as the Party wants to keep the dispossessed as they are, it will need the police, the army, and the militias. And the exploitation of the proletariat will continue to be the bedrock of the Chinese economy.
CHAPTER FIVE
The Downtrodden
“Workers of the province, welcome!” This is the message on the banner, displayed prominently in bold letters on the façade of the Man Sum textile factory at Zhongshan in Guangdong Province. Guangzhou, the migrants’ El Dorado, their ultimate destination! Of the province’s 100 million inhabitants, one-third are migrant workers. The lucky ones, from the Pagoda of the Phoenix, get a job here. Man Sum is a model factory in which employees are relatively well treated. Another banner says, “We will hire you, keep you on our payrolls, and pay steady wages.”
In early 2005, as mentioned, the Chinese government had, in all earnestness, asked employers to pay what they owed their workers in arrears by the end of the year. Some public- and private-sector firms had not paid their workers for two years. Kept on probation, these workers live in constant fear of being replaced by other migrants ready to take their place. The import of the Man Sum banners was to allay these fears, which is why the local authorities chose to take me there as part of their conducted tour.
Numerous banners read “Jobs Available,” a reflection of the concerns of the day. Guangdong is developing so rapidly that, in spite of the steady flow of migrants, there are still plenty of vacancies. Companies try hard to lure employees away from their competitors. Employees move from one company to the next, hoping to increase their modest wages or improve their working conditions. Migrants categorize employers as “good” or “bad.” Employers from mainland China are the worst, followed by those from Taiwan, Hong Kong, South Korea, and Japan. European firms offer better working conditions than even the American ones. The competition is cutthroat, especially among Chinese firms. Sometimes, companies adopt violent means to copy goods of other firms and produce them at half the price to eliminate their rivals. It’s a no-holds-barred market economy.
Guangdong Province alone accounts for one-third of all foreign investment and exports. Currently, it is facing stiff competition from other provinces that have set up the same global workshops. Gao, the man who founded the Man Sum enterprise and authored the banners, is sensitive to the ethical concerns of his European, and particularly American, clients. They buy their stock from him at the lowest possible price and sell it in domestic supermarkets. Of course, as a condition for purchase, the Westerners stipulate that Gao mustn’t “overexploit” his workers. Representatives from Wal-Mart come regularly to inspect his factory. Eighty percent of the goods sold in America’s largest chain store are made in China. The inspectors check whether the factory conditions are fair to workers while also maintaining quality.
Export companies in China are geared wholly to cater to the tastes of Western, primarily American, consumers. American consumers drive the Chinese economy. The country’s prosperity depends on them. Non-Americans do not play such a decisive role. Wal-Mart alone buys more from China than do Australia and Canada put together. Before they start their visit, Gao takes the inspectors to see the staff quarters, canteens, dispensaries, and kitchen gardens. Besides free accommodations—four workers to a room—workers earn about 100 dollars a month. The figure varies, because Gao pays the workers on a piecemeal basis and deducts money when a piece is badly executed or material is wasted.
Gao shows us around his factories in a Hummer, the most expensive American car on the market. The Cantonese do not think material success indecent. The source of Gao’s wealth is there for all to see. The word “devotion” appears frequently on the banners displayed in the workshops. (Thirty years ago, it was “revolution.”) As reward for this devotion to the factory, the blessings of the gods are sought. In every workshop, there is an altar before which incense sticks burn. The little shrines are dedicated to the god of prosperity, a reminder of the deep link between Daoism and the spirit of enterprise, contrary to what the Asia experts have been drumming into us for the past forty years. The French, like Léon Vandermeersch, and the Americans, like Hermann Kahn, have always attributed the economic success of Japan, Korea, and, more recently China, to the Confucian spirit. It was Confucianism, they maintained, that was responsible for the discipline in these countries’ factories. The fact is, however, that Confucianism idealizes authority, and it looks down on trade. A disciple of Confucius aspires only to public office; he will never stoop to sell cloth. The management in Korea and Japan was no more authoritarian than the political regime. In China, a dictatorial government enforces discipline, denies its workers any rights, and frowns on trade unions. The role of Confucianism, it seems, has been much overrated. And yet, without entrepreneurs, there can be no companies. Gao, the founder of Man Sum, is Daoist, like most Chinese entrepreneurs, and is open to the world. Gao worships the god of prosperity, not the somber Master Kong.
The real authors of the success story
Factories like Man Sum can be found in Bangladesh, the Philippines, and Mexico. In the past, they existed in Europe, the United States, and, until quite recently, in Japan, Korea, and Taiwan. The success of these factories lies in the quality of their workers, who labor for long hours at low wages. Workers usually put in forty-five hours per week plus overtime; they also work extra time to compensate for the frequent electricity breakdowns. The equipment consists of fifty-year-old, secondhand Japanese machines that have been overhauled. The workers’ skill more than compensates for the occasional shortcomings of the machinery. Unlike in Europe, capital is scarce and manpower abundant. If a worker slows down, he is at once fired and promptly repl
aced.
Does that mean that China’s economy is based on the exploitation of cheap labor drawn from an inexhaustible supply of rural workers? Other countries also have vast manpower reserves, yet they have been unable to derive any advantage. Low wages are certainly one of the reasons for Gao’s success on the international market, but more important is his capacity to use them. Without Gao’s entrepreneurial skills, and those of hundreds and thousands of employers like him from the coastal provinces, there would have been no Chinese economic miracle. Gao knows how to organize and direct his army of workers; he also knows how to attract major international buyers and get them to place giant orders (he manufactures a million T-shirts, for example). He keeps his word, maintains quality, and sticks to his prices and deadlines. Such rigor is hard to find in the industrialized world.
People like Gao do not appear out of the blue. They belong to a long tradition. Guangdong Province had always been a major trading center for adventurous merchants, until the Communist Revolution prohibited them from doing business. Many sought refuge in Hong Kong, where they flourished under liberal British rule. Overseas Chinese have played a major role in reviving commerce on the mainland. Had it not been for the 200-million-strong Chinese diaspora in Hong Kong, Taiwan, and Singapore, and farther off in the United States, France, Australia, and Canada, the Chinese economy could have never taken off at such a sustained pace. The capital for Man Sum came from Hong Kong: 60 percent of “foreign” investment in China is actually of Chinese origin. The owner of this typical export firm is Chinese, hailing from Hong Kong, and overseas Chinese manage the marketing network. The free Chinese have restored their not-so-free brethren to the ranks of the employed.