China Papers No. 18 | 2009 China’s Evolving Institutional Exclusion: The Hukou System and Its Transformation Fei-Ling Wang China Papers ABSTRACT This chapter discusses the evolving institutional exclusion in the People’s Republic of China by analysing the function and transformation of the hukou (household registration) system. An omnipresent system established nationally in the 1950s based on where one is, the hukou system has functioned in four important ways to organize the Chinese people through institutional division and exclusion. The thirty-year reform and opening since the late 1970s has brought to the hukou system significant adjustments, modernization, and adaptations; but the system’s fundamentals essentially remain intact, sustaining China’s peculiar political stability, economic development and social and spatial stratifications. After a decade of officially declared but repeatedly delayed and largely localized and commercialized reform efforts that are often cosmetic in nature, the hukou system now still entails and foretells China’s institutional nature. China Papers Introduction The Chinese civilization has had many distinctive institutional and cultural peculiarities in its long history. The tianxia (all under the heaven) conceptualization of a centralized, hierarchical sociopolitical order for the whole known world first implemented by the Qin Dynasty (221-207 BCE) and the rubiao fali (Legalism coated with Confucianism) imperial governance since the Western Han Dynasty (202 BCE-9 CE) are just two leading examples. To anchor the Chinese sociopolitical order and sustain the Qin-Han style institutional framework, Chinese rulers have relied on a highly unique and very profound way to manage the people, a peculiar institutional exclusion that has served as the foundation to identify, segment, organize, and control the massive and ever growing population. This Chinese institutional exclusion is featured with the key role of the hukou (household registration) system, which has been used from the Qin Empire basically all the way to the PRC (People’s Republic of China) today. Much of China’s imperial and contemporary history and many features of the Chinese social, economic and political development have been crucially conditioned and affected by this hukou system, which has thus become a key indicator demonstrating the institutional continuity in China. The hukou system has been dividing and organizing people, regulating internal migration and resource flow, and shaping people’s spatial, social, and cultural stratification and identity. Much of China’s profound rural-urban and regional gaps and the remarkable stability and strength of an authoritarian government in a vibrant market economy, for examples, is either directly created and maintained or crucially supported by the hukou system. Despite repeated efforts to reform the hukou system in the past three decades, it remains a foundational institution that helps to define politics, social life, and economic development in China. (Chan 2009; Wang 2005:32-60; Solinger 1999; Davin 1999; Cheng & Selden 1994; Dutton 1992) The effects of the hukou system are extensive and contradictory. It undoubtedly creates and perpetuates some of the most rigid and unfair sociopolitical and economic discrimination and injustice in the world through administratively excluding the majority of the Chinese people from vibrant and prosperous urban centers. It also seems to have contributed to a rapid, albeit highly uneven, economic growth and minimized the development of urban slums. The hukou system powerfully brews social tensions and political grievances and significantly exacerbates ethical problems of inequality and inequity for a Chinese government that now aspires to create a “harmonious society” and achieve a “peaceful rise,” while crucially serving Beijing’s fundamental interest of political stability, population control, and regime survival. Solidifying and reinforcing the rural-urban and Page 1 of 28 China Papers interregional gaps for generations, the hukou system has been a key floodgate that is now under increasing strain, whose renovation has given reasons for hopes and hypes about narrowing and even erasing China’s rural-urban gap. A removal or crumbling of this legal Great Wall would certainly reshape China’s political landscape and the nation’s future but could also lead to the drowning of thriving Chinese cities and Beijing’s dream of a quick ascendance in the global power ranking. (Wang 2005 85-124) Being an easy target of criticisms, the hukou system is recognized by Beijing and its critics as an indispensable pillar of sociopolitical stability and economic development. Influential Chinese scholars have concluded that the “secret” of the PRC economic boom is the deprivation of human rights, civil rights and fair pay of the millions of laborers, to which the hukou system clearly plays a key role. (Qin 2009) In an attempt to shed some light on the institutional dynamics and transformation of China, this Chapter discusses China’s evolving institutional exclusion through analyzing the function and transformation of the hukou system. I will first briefly describe the notion of institutional exclusion and outline its presence in China. Then I will report the basics and the four functions of the hukou system in today’s PRC—four important ways to organize the Chinese people through institutional division and exclusion. The thirty-year old reform and opening since the late 1970s has brought to the hukou system significant adjustments and adaptations; but the system’s fundamentals have remained. In the last decade, there have been great needs and tremendous pressure for renovating the hukou system so as to preserve this extremely important instrument of social control for Beijing while reducing its political costs through pacifying the increasingly mobile and still largely excluded rural and non-local population. There are powerful reasons for urban centers, especially the privileged major cities, to resist real changes that would be needed to genuinely transform the hukou system and the peculiar Chinese institutional exclusion it supports. So far, however, the excluded population still has very little resources and almost no political power, other than unorganized violent protests, to really accomplish much.Therefore, thus far the reform of the hukou system has been slow, heavily localized and regionalized, frequently cosmetic and expedient, utterly incomplete, and often distorted and reversed, reflecting both the enormity and the complexity of the task itself and the overall reality of the Chinese political system, which, under the authoritarian regime of the CCP (Chinese Communist Party), has structurally favored the minority of the population living in urban centers. Some of the changes may have actually further enlarged the rural-urban gap by creating powerful internal brain drains and capital drains. Localized barriers of “entry conditions” may have actually made “permanent migration of the peasants to the cities harder than before.” (Cahn & Buckingham 2008) Beijing still retains the final say about the system, and Page 2 of 28 China Papers there is tight control over words and acts involving hukou reforms. Barring major, tectonic shifts of political power inside the CCP and real political reforms, the PRC hukou system is likely to remain as a great floodgate, however crumbling while being renovated, separating and dividing the Chinese people, chiefly along the fault-line of rural versus urban. The hukou system remains to entail and foretell China’s institutional nature. 1. A Note on Institutional Exclusion Institutionalized divisive and exclusive barriers or institutional exclusions are some of the most fundamental rules, regulations, and behavioural norms and codes that define, stratify, and constrain people’s movements and access rights as well as their interaction. Institutional exclusions are part and parcel of any nation's organized domestic structure-the nation’s internal institutional nature. They divide and organize people, manage and allocate resources including labor with priorities and purposes, and enable political and social control. All economically and politically stratified classes and all culturally and socially separated groups and associations are sub-units of this inclusion-exclusion divide to varied extent. (Wang 2005: 1-15) Historically, we have four identifiable types of institutional exclusion that constitute a crucial part of a country’s internal institutional make at various times and in different cultural settings and external environments. Of course, the four types listed below often overlap with one another and in reality create hybrid variations. Indeed, few nations have only one type of institutional exclusion. (Wang 2005:10). Type One institutional exclusion is in which people are divided and excluded because of who they are in terms of their race and ethnicity, linguistic, sexual, religious and/or other personal differences. Type Two institutional exclusion divides and excludes people based on what they have regarding their resource and property-ownership, wealth, and skills. Type Three institutional exclusion divides and excludes people based on where they are in regard to their legally recognized family associations and their physical location or birthplace, such as citizenship and legal residence. Type Four divides and excludes people based what they did/do or their individual work, profession, and conduct. Page 3 of 28 China