Haves and have-nots in China

Posted: 11 February 2013 in Uncategorized
Tags: , , ,

201202010_China-slide-D4T8-blog427 China-inequality

Sim Chi Yin’s photographs [ht: sm] and a Pew Research Center survey tell the same story: the gap between the haves and have-nots in China continues to grow, and the Chinese people are well aware of it.

  1. Ben says:

    If 81% of people agree with a statement, does that make it any more true?

    In reality, the general trend is that the free enterprise system improves the conditions of poor people and provides for greater social mobility. If you only look at relative income and freeze-frames of where people sit on the income spectrum, then you don’t get the whole picture.

    The poor are not getting poorer, they simply aren’t getting rich as fast as the rich are. We can talk about the fairness of our situation, but let’s be honest about the facts.

  2. Ben says:

    Woops, forgot to subscribe.

  3. Scott M. says:

    Ben, I don’t think you’re right about that.

    It’s the work and industrialization that is making the Chinese as a whole more wealthy. It’s the capitalism that causes the inequality.

    It’s possible to imagine a communist enterprise, industrial in nature, that would provide the same products and benefits, but the benefits would be more evenly distributed which would benefit the workers even more.

    I could take issue with your other statements like free enterprise system providing greater social mobility by pointing out those who have benefited the most are the already politically powerful. This implies those who have the money and power get richer, thereby shutting out the working poor. Obviously exceptions can and will be found but capitalism economies tend to reduce social mobility in the aggregate.

    • Ben says:

      Hey Scott, thanks for the reply.

      You’re right about why the Chinese as a whole are becoming more wealthy. And yes, unequal outcomes is an inherent feature of capitalism.

      We can imagine a communist enterprise that produces the same wealth but distributes the wealth more evenly, but that doesn’t necessarily mean this experiment would work well in practice.

      When we examine the historical record, we see many examples of collectivized industries that completely failed to live up to their promise. Production plummets and people starve en masse. Furthermore, the extreme concentration of political power that follows communist movements has lead to obscene levels of oppression – political persecution, forced migration, mass executions. I’m talking about the communist movements in Soviet Russia, China, Indonesia, Eastern Europe, and North Korea, and Cuba.

      I’m always open to try new things, but is it worth the risk considering communism’s track record? I’ll be the first to admit that capitalism isn’t perfect, but it has fared far better than anything else attempted thus far.

  4. Magpie says:

    Let’s examine Ben’s observation.

    It seems to me, upon reading this:
    “However, there is a general consensus in China that the economic gains of recent years have not benefited everyone equally: 81% agree with the statement the ‘rich just get richer while the poor get poorer’, and 45% completely agree.”

    Ben asked:
    “If 81% of people agree with a statement, does that make it any more true?”

    The answer, obviously, is not.

    However, if one cannot trust the perceptions of those answering the question, I wonder, why should one trust Ben’s perceptions?

    In the rest of his comment I could not find a single figure (1) supporting his own position and (2) explaining why the views reflected in the survey are mistaken.

    I checked the PEW link, and I didn’t see any other figure that would cast doubt on the figure above.

    I may be reading too much into this, of course, but I seem to perceive (and perhaps I am mistaken) in Ben’s comment that his own opinion, a priori, carries much more weight than those of the affected parties.

    For some reason, this makes think of a doctor telling the patient complaining about a broken bone “C’mon. It doesn’t really hurt that much”, before looking at the x-rays.

    • Ben says:

      Magpie, let me apologize.

      First, I started off with a somewhat snarky rhetorical question which didn’t help to establish a constructive tone. Second, as you pointed out, I didn’t attempt to substantiate any of my comments.

      I was trying to point out that person-on-the-street surveys aren’t a very good method of evaluating claims about objective facts, such as “Today, it’s really true that the rich are getting richer while the poor are getting poorer.” It’s best to just look at economic data for that. However, if I wanted to have an answer to a more subjective question, such as “Are you better off today than you were 10 years ago?”, then the best way is to just ask you.

      Consider this: “About nine-in-ten (92%) Chinese say their standard of living is better than their parents’ at a comparable age, including 39% who say it is much better.” (From the PEW survey cited above.) The fact that this section of the survey was skipped by the original poster is indicative of the problem, I think. It’s important to look at absolute changes in standards of living for each income bracket. Looking only at relative incomes gives a (false) impression of worsening conditions for the poor in China.

      Here is another interesting result of the survey: “Nearly three-quarters of the Chinese public (74%) agree that most people are better off in a free market economy, even though some people are rich and some are poor. About one-in-five (19%) disagree. Support for capitalism is widespread across age groups, education levels and income brackets.”

  5. Ben says:

    Here is some 1996-2005 US data on absolute income mobility (average increases in income for each income bracket) and relative income mobility (movement of families between income brackets): http://www.treasury.gov/resource-center/tax-policy/Documents/incomemobilitystudy03-08revise.pdf

    This video does a good job of explaining the signification of the data and addresses the question of whether or not the poor are getting poorer: http://www.youtube.com/watch?v=vDhcqua3_W8

  6. Claudia says:

    One of China´s major problems is the Have vs. Have-Not´s. Describe the nature of the problem by considering population problems, the Hukou system, and temporary migrant laborers, among any others. How is the government planning to resolve the dilemma? In your opinion, what is the prospect of reducing the division between the Have and Have-Not´s?

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