A CAULDRON OF LOOMING CONFLICT

[YAN Hairong <yhairong@uiuc.edu>]

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A CAULDRON OF LOOMING CONFLICT
By Carlito Parungo
28 September 2005

It is April 2001 and the people of Ta-ching are restive.
Located in
northern China, Ta-Ching is witness to a series of
demonstrations being
launched by its 700,000 workers, almost half of whom were
summarily laid
off from their jobs.

The workers are incensed at the factory owners who never even
bothered
to offer those fired any compensation and at the government
which chose
to ignore their plight and cries for justice.

Perhaps out of sheer desperation, some disgruntled workers and
supporters resort to a radical action: they decide to put a
bomb at the
local government office. The bomb explodes, killing the mayor, the
deputy mayor, the local Party secretary, and nine others,
including
three workers who took part in the incident.

The government finally responds by sending some 50,000 Army
soldiers who
were ordered to encircle the factories and “restore peace”. To
their
surprise, it is they who are encircled by the workers and the
local
people. The people of Ta-ching are ready to fight.

Eight months later the impasse will be resolved, with the
government and
factory owners forced to pay the workers higher separation pay.

Widespread

“Most probably you never heard of the Ta-ching incident in the
news, did
you?”

Pao Yu Ching, a retired professor emeritus of Marygrove College in
MIchigan, USA, and a well-known China scholar, posed this
question to
her audience during a lecture she gave last September 10 in
Utrecht, The
Netherlands. The lecture was sponsored by the International
League of
Peoples’ Struggle (ILPS) and was attended by a "multi-national"
audience, some even coming from Germany, Belgium, Luxembourg
and the
United Kingdom.

She said many of such incidents were never reported before
despite their
newsworthiness. But of late, Ching observed that media people
in China
have no
choice but to report on the peasant uprisings and workers’
strikes and
demonstrations because of their increasing frequency and scope.

“Mass actions in China now average 70,000-80,000 a year,” said
Ching.
“That means that every day not fewer than 200 demonstrations
are taking
place all over the country.”

Workers’ and peasants’ grievances are long, asserted Ching.
“For the
workers, these are massive retrenchment and high rate of
unemployment,
unpaid back wages, absence of housing benefits, decreasing
pension (or
the lack of it), and other economic issues confronting them.”

In the countryside, the peasants’ main issue is their continuing
displacement as a result of massive landgrabbing and
unemployment, added
Ching.

The situation of the workers and peasants is really terrible
these days,
lamented Ching, who has gone to China twice this year. “To an
outsider,
China is one country that is on its way to becoming a
developed country.
That couldn't be farther from the truth, and judging from the
widespread
dissatisfaction of its toiling people, China may soon find
itself in
deep trouble,” Ching averred.

Goodbye, communes…

Ching described the Chinese people’s growing impoverishment and
discontent as resulting from the series of reforms that the
Deng clique
instituted immediately after its successful power grab in 1979.

She explained: “The first policy was to break up the communes,
producing
individual peasants again. Deng succeeded in implementing this by
increasing the purchasing price of rice, wheat, corn, and other
agricultural products by 20 percent, and another 50 percent if
a peasant
was selling above quota.”

“Until 1984, or five years after the policy was put in place,
peasant
income was climbing by 15 percent a year. So the peasants were
happy.
They were even exclaiming that it was a good policy because
they were
doing better now that their income was increasing,” added Ching.

But that would prove to be shortlived and unsustainable. In the
succeeding years, the increase in income slowed down from 5
percent to 1
percent. From 1997 up to now, with the total farm output
remaining the
same, the purchasing price of agricultural products has even
gone down
by 30 percent.

With the high taxes imposed on their income, many peasants became
bankrupt and were eventually forced to find jobs in the
cities. Ching
said that 100 million peasants are now working in the cities
because
there is little to do in the rural areas. Ching thought of
Deng’s policy
a “smart” one because “it was easier to do reforms in
agriculture than
in industry”. She added: “By dissolving the communes, Deng
practically
broke up the basic alliance of the workers and peasants.”

…and the “iron rice bowl”, too

Deng moved on to implement the so-called economic structure
reform in
1985 and labor reform in 1986.

The economic structure reform was a key change in the
industry, Ching
said. “In the past, state-owned enterprises did not have any
calculation
of profit or loss. If there was profit, it went to the state;
if there
was a loss, the enterprise would get a subsidy. This was the
only way
the state could plan the economy. If it wanted to develop heavy
industry, more money would flow to it, even if it was not
making money.
There was no calculation of profit or loss. There was no
reason to do that.”

With the introduction of the profit-and-loss concept, however,
investment priorities favored those enterprises that were making
profits. Ching added that managers, whose salaries and
benefits were
raised tremendously, were also given blanket authority to sell
or lease
out state assets that were performing poorly. This resulted in
millions
of workers losing their iron rice bowl or permanent employment
that
until then was guaranteed under a socialist state.

Aside from being retrenched as a result of bankruptcy, workers
could be
freely fired by the managers even with flimsiest of reasons.
Instead of
hiring workers for permanent appointment, managers could also
avail of
contract workers. This, according to Ching, is what the 1986 labor
reform introduced.

However, the implementation of the labor reform met rough sailing
because of the strong resistance offered by the workers. Faced
with the
prospect of losing their iron rice bowl, the workers initially
succeeded
in frustrating the attempt of the state to apply this policy
to state
enterprises at that time.

In the course of time, though, Ching said the state managed to
defeat
this resistance by selling out state assets, at giveaway
prices, to
people who had connections. There have also been many cases of
managers
taking the profitable part of state enterprises and setting up
other
companies, thus bankrupting state enterprises and displacing
workers,
Ching shared.

Since the middle of 1990, Ching said more that 10 million
workers have
lost their jobs as a result of Deng’s labor reforms.

Good life

“If one goes to China today and sees all those high-rise
buildings, he
will immediately think that prosperity is everywhere. In the
supermarket, he will find everything and may conclude that
people are
really having a good life,” Ching related. “Yes, in fact some
people do
have a good life. A very good life.”

After June 4, 1989 (the Tiananmen uprising), Ching said the
government
made a conscious decision to “bribe” the intellectuals and those
occupying high government positions by making them partake of
the good life.

She said this has only increased the gap between the haves and
have-nots, a situation that a recent report of China’s
official news
agency Xinhua acknowledged as “provoking alarm”.

“The most affluent one-fifth of China's population earns 50
percent of
total income, with the bottom one-fifth taking home only 4.7
percent.
The income gap, which has exceeded reasonable limits, exhibits
a further
widening trend. If it continues this way for a long time, the
phenomenon
may give rise to various sorts of social instability," the
report said.

Ching: “But the super-rich live extremely well. And what they
earn are
from legal sources.” What is not visible, according to Ching,
is the
income coming from corruption especially in the government and
in the
remaining state enterprises.

“There is a joke in China that if you line up all government
officials
and kill the even numbers, say 2, 4, 6, etc., that means the
same number
of guilty ones will go free,” Ching said in jest.

The workers on the other hand, Ching said, earn an average of
600 yuan
renminbi (US$ 74) a month, or sometimes it can go up to 1,000
yuan. Yet
they also don’t enjoy any housing benefits or health care, she
added.

Aside from living the hard life, workers and peasants have to face
police brutality, which Ching described as 10 times worse than in
Taiwan, where she is currently based.

“I remember a story shared to me about the two Chinese girls
who were on
their way home. One was not carrying a proper ID for her
bicycle and the
police decided to arrest her. When seen again, the girl was
dead and
said to have been raped before being killed. The town was in
uproar and
demanded that those involved be punished. But instead of
arresting the
guilty policemen, the police hierarchy found someone else, a
poor man,
and bought his life from his family for 10,000 yuan.”

According to Ching, life in the countryside is no better
because the new
bureaucrats are far worse than the old-time landlords. She
said they
have more power today and are more abusive.

“There was a case of peasants who organized themselves to
question the
exorbitant taxes being imposed on them. They elected 12 people to
represent them in asking the management to check the books and
where the
taxes were being spent. Instead of being heard, three of the
peasants
were beaten to death. Just like that.”

Many peasants used to take the train to Beijing to seek redress,
thinking the central government would do something about police
brutality and landgrabbing as well. But Ching said there have
been cases
that some peasants failed to reach Beijing because they had been
kidnapped along the way.

She said that the ruling Communist Party has practically stopped
recruiting members among the workers and peasants, adding it
is now the
intelligentsia that is lured into it because of the many perks
attached
to being a Party member.

Ching was also surprised that many of today's generation of
youth and
students are not even aware of the revolutionary tradition of
their elders

The Party's work among the masses has been reduced to
organizing guided
tours to some historical places that were visited by Mao
during his
time, for example Yenan, in order for it to have a semblance
of being a
communist party, Ching said.

“In fact, to many average Chinese I spoke with during my
visits there,
the ruling Communist Party is everything but communist,” Ching
said.
“And if you ask
me, today’s China has totally lost all its socialist elements
of any
kind”, she added.

Big capitalist power?

To the question whether China is set to become the next capitalist
powerhouse, Ching’s answer was a big no. She enumerated six
reasons why
China would not develop capitalism successfully:

1. China’s agriculture is backward. It is not modernized.
Agricultural
reform did not succeed. Irrigation is gone. The forest is in
terrible
shape. Farmers did not want to give up their land. All this
added up and
failed to attract capital to invest in agriculture.

2. There is a small internal market because the salary of
workers and
the income of peasants are kept to a minimum. Ninety percent of
factories have overcapacity.

3. China is using exports to create employment and income. The
US is the
biggest importer. It is borrowing money from China to buy from
China.

4. China depends on import of technology and of parts.

5. China gave up so much to enter the World Trade Organization
(WTO).
The service industry was given up. The computer, medical, and
other
industries were opened up. By 2010 foreign banks will be just like
national banks. Of the top 1,000 banks, China has 16. Of
these, 15 are
already controlled by foreign banks. Bank of America and Royal
Bank of
Scotland are investing billions of dollars to take over local
banks.

6. In the last 25 years, China’s environment and natural
resources have
been severely damaged. The country is overutilizing its own
resources.
Water is now very scarce and there is even shortage in oil.

Ching concluded that the growth of capitalism in China is not
sustainable. “China becoming a superpower is nothing but US
propaganda.
In fact, the Chinese economy is overheated. It is due to burst
some time.”

With the increasing number of working people realizing the
betrayal of
the Deng clique, Ching said that China is in for interesting
times. She
said the efforts of some people there to study and do
something about
the current situation in the country are encouraging.

Ching expressed her wish that someday all the scattered mass
actions in
the country take a more organized form and gain more success,
just like
the Ta-ching uprising.

Anyway, to end the Ta-ching story…

To celebrate their victories, the workers erect a memorial in
honor of
their three co-workers who died earlier and the four others
who were
arrested and executed for the bomb explosion. These fallen
workers may
be criminals in the eyes of the Chinese government, but for
the Ta-ching
workers they are martyrs who died for their cause.

-oOo-

Carlito Parungo is a freelance journalist and web designer. He is
currently based in Amsterdam.