China Net Assessment History Section Prep

SOCIETY

There are several social trends that will continue to plague the Chinese government. The most important, from which many other problems emerge, is the distribution of wealth.

The growing wage gap has not only led to an increase in social tensions and protests, but has also spurred mass migration from inland provinces to the coast. Migration itself is another important problem. The “hukou” system, which regulates migration, has created an underclass. Although the system is now defunct, migrants and rural citizens are still denigrated as a lower social class.

Additionally, the unemployment problem in China is growing further exacerbating social tensions. This is not only unemployment of rural labor—pushing the migration, but also of educated university graduates. Currently these two disparate groups have not coalesced to produce a coherent social force, but there is increasing pressure on the state to revert to socialist principles to provide a safety net for the unemployed.

While China currently faces a growing unemployment crisis, it is simultaneously becoming a graying society with increasing pension tensions. The state no longer provides the pensions it once did under a command economy. Pension problems and caring for the elderly will continue to put pressure on the state as they search for a way to privatize pensions.

The problems stemming from the distribution of wealth will be the most prominent social issue, but other issues such as the environment, health care, and education will also spur debate and protest. China’s environment is in dire need of a clean-up, but the government will focus on more pertinent issues such as unemployment. Health care and education reform that give greater national accessibility is also on the agenda, but will take a back-seat to the distribution of wealth, and these issues will be discussed primarily when they dovetail with this preeminent concern.

All of these social problems lead the government to search for a new ideology that can bind the masses. They have been playing the nationalist card to this effort, but it is not enough. Communist ideology is no longer potent. The government has been relying on economic legitimacy to forward its rein, but the problems of the distribution of wealth have forced the current regime to promote “social harmony” as their mandate. This has lead to a reversion to socialist principles.

The reintroduction of some socialist principles helps to address some of the problems surrounding the distribution of wealth, but they alienate others, primarily those that have been driving the economy. If the economy slows down, the unemployment issue will increase. The Chinese government will continually be forced to face contradicting goals of maintaining economic growth while ensuring an even distribution of wealth. Given this dilemma, it is not unlikely that the government will seek out another source of legitimacy to maintain power. This may come in the form of religion—a religion that the Chinese can stomach and can easily manipulate. The precepts of Buddhism—non-resistance, pacifism, etc—might lend itself to these goals.

SF China Net Assessment – Society 1 Appendix 1 – Social and demographic

1. DEMOGRAPHICS

A few interesting trends to focus on:

. population growth speculations - The number of young adults of reproductive age (20 - 49) will reach its maximum of more than 660 million around 2010. After that time, the number of elderly people will surpass those of working/reproductive age. (could discuss implications for pension system and population control here). . population density and projections – there has been steady migration to urban areas since 1978 (see chart below) because of the demand for migrant labor and the rising productivity of urban areas (greater demand for labor in high productivity areas) . wealth gap by area – the income gap between rural and urban areas has been on the rise since 1978 and now the disparities are quite significant and the source of societal frustration and unrest

2. SOCIAL

Most significant items:

. environment – general situation is dire – specifically water, desertification and air pollution, yet enforcement is erratic and economic development often takes priority over environmental concerns. . social unrest – causes are varied, but trends in general instances of social unrest show a rise in both the number of instances and the average number of people involved in each instance . changes in the iron rice bowl/benefits –the significance of “iron rice bowl” – it developed a generation of workers who saw wage levels and job security as completely unrelated to job performance and productivity. Changes in the system since 1978 have seen the elimination of many of these “iron rice bowl” jobs. Yet, changing demographics (specifically a rise in the pension-collecting population) have dragged on the pension system and created the need for reform. The past few years (and surely the few years ahead) should see increased reform, and also changes to the hukou household registration system.

SF China Net Assessment – Society 2 Appendix 2 – Population details

Since 1978, the population has grown from 962 million to 1.29 billion. Yet, through population control measures, the central government has managed to half the natural growth rate in this same time period. Another notable statistic is the sharp drop in the rural population. When examining the rural and urban populations as a proportion of the whole population, the urban population has grown from 18 percent in 1978 to about 42 percent in 2005. A similar drop has occurred in the rural population, which has dropped from 82 percent of the population in 1978 to 58 percent in 2005

CHINA – Population and its Composition Source – China Statistical Yearbook, 2006 Data in this table exclude the population of Hong Kong SAR, Macao SAR and Taiwan Province. (figures are in 10,000 persons)

By Sex By Residence Total Male Female Urban Rural Year Population Population Proportion Population Proportion Population Proportion Population Proportion

1978 96259 49567 51.49 46692 48.51 17245 17.92 79014 82.08 1980 98705 50785 51.45 47920 48.55 19140 19.39 79565 80.61 1985 105851 54725 51.70 51126 48.30 25094 23.71 80757 76.29 1989 112704 58099 51.55 54605 48.45 29540 26.21 83164 73.79 1990 114333 58904 51.52 55429 48.48 30195 26.41 84138 73.59

1991 115823 59466 51.34 56357 48.66 31203 26.94 84620 73.06 1992 117171 59811 51.05 57360 48.95 32175 27.46 84996 72.54 1993 118517 60472 51.02 58045 48.98 33173 27.99 85344 72.01 1994 119850 61246 51.10 58604 48.90 34169 28.51 85681 71.49 1995 121121 61808 51.03 59313 48.97 35174 29.04 85947 70.96

1996 122389 62200 50.82 60189 49.18 37304 30.48 85085 69.52 1997 123626 63131 51.07 60495 48.93 39449 31.91 84177 68.09 1998 124761 63940 51.25 60821 48.75 41608 33.35 83153 66.65 1999 125786 64692 51.43 61094 48.57 43748 34.78 82038 65.22 2000 126743 65437 51.63 61306 48.37 45906 36.22 80837 63.78

2001 127627 65672 51.46 61955 48.54 48064 37.66 79563 62.34 2002 128453 66115 51.47 62338 48.53 50212 39.09 78241 60.91 2003 129227 66556 51.50 62671 48.50 52376 40.53 76851 59.47 2004 129988 66976 51.52 63012 48.48 54283 41.76 75705 58.24 2005 130756 67375 51.53 63381 48.47 56212 42.99 74544 57.01

a) Data before 1982 were taken from the annual reports of the Ministry of Public Security. Data in 1982-1989 were adjusted on the basis of the 1990 national population census. Data in 1990-2000 were adjusted on the basis of the estimated on the basis of the 2000 national population census. Data in 2001-2004 have been estimated on the basis of the annual national sample surveys on population changes. Data in 2005 are estimated on the national 1% sample survey on population. (the next table is the same). b) Total population and population by sex include the military personnel of Chinese People's Liberation Army, the military personnel are classified as urban population in the item of population by residence.

SF China Net Assessment – Society 3 Growth Rate - The Chinese, through their one-child policy and other measures of population control, have managed to cut the natural growth rate by more than half between 1978 and 2004.

CHINA – Birth Rate, Death Rate, Natural Growth Rate of Population Source – China Statistical Yearbook 2006

(in %)

Birth Death Natural Year Rate Rate Growth Rate

1978 18.25 6.25 12.00 1980 18.21 6.34 11.87 1981 20.91 6.36 14.55 1982 22.28 6.60 15.68 1983 20.19 6.90 13.29 1984 19.90 6.82 13.08 1985 21.04 6.78 14.26 1986 22.43 6.86 15.57 1987 23.33 6.72 16.61 1988 22.37 6.64 15.73 1989 21.58 6.54 15.04 1990 21.06 6.67 14.39 1991 19.68 6.70 12.98 1992 18.24 6.64 11.60 1993 18.09 6.64 11.45 1994 17.70 6.49 11.21 1995 17.12 6.57 10.55 1996 16.98 6.56 10.42 1997 16.57 6.51 10.06 1998 15.64 6.50 9.14 1999 14.64 6.46 8.18 2000 14.03 6.45 7.58 2001 13.38 6.43 6.95 2002 12.86 6.41 6.45 2003 12.41 6.40 6.01 2004 12.29 6.42 5.87 2005 12.40 6.51 5.89

SF China Net Assessment – Society 4 Population Growth

This chart shows the number of people in China (mainland and Hong Kong) by selected age groups. The number of young adults of reproductive age (20 - 50) will reach its maximum of more than 660 million around 2010. This explains why the period between 1995 and 2025 (shaded light blue) is the most critical for the country's future population growth. Only if average fertility remains low among this large cohort, will it be possible to stabilize the number of births. Otherwise, the large number of parents will produce another baby boom in China. In this UN projection, it was assumed that the average Total Fertility Rate (TFR) increases only slightly from 1.8 children per women in 1995 to 1.9 children in 2010 and then remains at that level. In other words, fertility in China is estimated to remain below replacement level for the next 50 years.

Source: United Nations Population Division World Population Prospects.

SF China Net Assessment – Society 5 Appendix 3 – Environment

INRODUCTION Environmental degradation is severe – and exists alongside a massive population and aggressive economic development. The appetite for consumer goods among the middle class is growing (ECON – growth is occuring in both the middle class and its appetite for consumer goods), especially for automobiles, meat and dairy products, and energy. Economic development threatens further environmental degradation.

1. WATER

China’s has serious water problems – pollution, distribution and flooding. Most of China’s domestic and industrial wastewater is released untreated into China’s waterways. In 1996, only 5% of household waste and 17% of industrial waste received any treatment, and little improvement has been made since (check for recent stats, also maybe a comparison to US stats?). Approximately one half of the drinking water in China is contaminated with human and animal feces. China’s seven largest rivers (map, possibly) – the Huai, Hai, Liao, Songha, Yangtze, Pearl and Huang (Yellow) are all severely polluted – quality in more than half of the monitored sections is designated as class 5 or worse (the worst rating for water in China) and 80% of the rivers can no longer support fish. The yellow river is so contaminated that most of it is unfit for human consumption or irrigation. The shoreline is getting more and more contaminated as well.

There is a disparity between water resources and argriculture production – 66% of the agriculture is in the north, but 80% of the water supply is in the south. Yellow River dry for as much as 2/3 of the year.

Urban water demand is expected to increase 85 percent between 2000 and 2050 (World Bank – “China: Agenda for Water Sector Strategy”).

2. AIR POLLUTION

According to the World Health Organization, 7 of the 10 most polluted cities in the world are in China. In addition, respiratory diseases such as lung cancer, heart disease, bronchitis are common. China has the world’s fastest growing automobile market – home to 20 million vehicles – and counting. This does help the air pollution problem.

3. FOOD

China is losing its cropland due to overgrazing, overplanting, industrialization, and increases in roads, parking lots and housing. The population is growing, but grain production of corn, barley, sorghum, oats and rice is falling. (55). Soybean trade – China has to import most of its soybeans from the US – dramatically affecting world supplies and costs (57).

SF China Net Assessment – Society 6 3. DESERTIFICATION

Remote Sensing Data on expansion of sandy desertified lands over the past five decades: 1560 sq. km/yr between 1950 and 1975, 2100 sq km/yr between 1975 and 1987, 3600 sq km/yr between 1987 and 2000. Time/Space evolution of desertification – journal of desert research 23(3) – 2003, 230-235.

Causes are both natural and athropogenic. Natural – climate change and adverse factors (dry climate, erratic precipitation, sandy soil texture, strong and frequent winds) – natural causes are generally small scale and protected by the natural ecosystem. Anthropogenic – human population pressure, overcultivation, overgrazing, deforestation, overextraction of ground water. What does desertification do to the land? Reduces soil capacity to hold water, intensifies airflow, brings more rapid and severe, direct damage. As people clear forest areas to extend cropland and collect firewood – then overgrazing and industrial construction occurs and desertification begins – it exapands and the climate becomes drier.

Desertification causes: . damage to the ecosystem . lower land productivity . loss of usable land resources . direct economic losses . increase in strength and frequency of sand and dust storms – dust storm stats – 5 times/year in the 1950s, 8 times per year in the 1960s, 13 times per year in the 1970s, 14 times per year in the 1980s, and 23 times per year in the 1990s. The increase in dust storm frequency coincided with the spread of desertified land.

One quarter of the land has been desertified. The rate of desertification In 2003 was reported to be increasing at 1300 square miles per year (China Daily – desert still poses great threat – june 18, 2003)

4. POLICIES / RESPONSES TO ENVIRONMENTAL ISSUES

Bottom line – The Chinese are great at coming up with plans. Their problem is implementation.

Agenda 21 - Developed in May 1993 to addresses sustainable development (what has happened with it since then?)

5. FIVE YEAR PLANS

China has started addressing sustainable development in its current 11th five-year plan adopted last year (e.g. “Putting a Price on Water” plan)

Enforcement is really fragmented – the central government has delegated environmental projects to the local level, which has caused mixed results – become more of a patchwork rather than a centralized policy.

SF China Net Assessment – Society 7 SF China Net Assessment – Society 8