WASHINGTON—After the fall of Hosni Mubarak in Egypt and Ben Ali in Tunisia, speculation has turned to China and prospects for a revolt to the Chinese Communist Party’s (CCP)’s rule of 61 years. No one can see into the future, but probably the majority of China scholars agree that the fissures between the people and their rulers have grown in the past decade. The Party will certainly be challenged to keep a lid on protests spinning out of control.
The U.S. -China Economic and Security Review Commission (USCC) held an on-the-record hearing with two panels, Feb. 25, regarding China’s “Internal Dilemmas.” Panel 1 gave testimony on the root causes of tens of thousands of protests every year and why the number keeps growing. This is the micro level of China’s popular unrest, which reveals that the Party will increasingly have its hands full in containing it. The details of this panel have been discussed in another Epoch Times report .
The Commission also heard from a second panel giving a macro perspective on the causes underlying mass protests and instability, namely, the major challenges to China’s economy and the likelihood that its high growth rate is not sustainable.
Despite heavy security, the total number of mass incidents by the end of 2008 had risen to 120,000, said Tanner. With the coming of economic downturn in 2009, it is quite possible the numbers climbed still higher in 2009 and 2010, according to Tanner.
Professor Xia Yeliang of Beijing University said in a Radio Free Asia interview that, according to the statistics from the CCP’s Political and Legal Committee, the number of group protests in 2009 rose to 230,000.
What is the nature of these protests? Dr. Elizabeth Economy, from the Council of Foreign Relations, listed land disputes, environmental issues and labor unrest. The Epoch Times and others have described eye-witness accounts of local officials expropriating land illegally and/or compensating well below market value.
Environmental protests may occur from “the failure of local officials and factory managers to enforce environmental regulations,” leading to riots, violence and deaths, testified Dr.Economy.
Labor issues are another growing source of unrest. Last year, workers achieved higher wages and better working conditions in the coastal area of China where there were labor shortages and better-educated workers. Strikes may be illegal in China but that didn’t deter the workers.
To Economy’s three major kinds of protests, Tanner would add withheld wages and pensions and “the refusal of local authorities to accept or honor citizen petitions.”
According to Tanner, it was not that there were more grievances that accounts for the steadily rising number of protests for two decades, but the absence of legal and political institutions that allow effective redress of grievances.
“Venting one’s frustrations in ways that are perceived to be taken seriously by the authorities are as important as actually resolving an issue,” said Yukon Huang, Carnegie Endowment for International Peace, on the second panel.
The first panel’s experts frequently mentioned the importance of the Internet and social media in the communication of social issues, for example, police beating protesters, and in helping to organize protests. As in Egypt and Tunisia, the Internet has become in China, “a virtual political system,” whereby a particular complaint or incident can be shown and in a matter of minutes “go viral,” said Dr. Economy.
Next: Recent calls for a ‘Jasmine Revolution’ in China began with a Twitter post
The U.S. -China Economic and Security Review Commission (USCC) held an on-the-record hearing with two panels, Feb. 25, regarding China’s “Internal Dilemmas.” Panel 1 gave testimony on the root causes of tens of thousands of protests every year and why the number keeps growing. This is the micro level of China’s popular unrest, which reveals that the Party will increasingly have its hands full in containing it. The details of this panel have been discussed in another Epoch Times report .
The Commission also heard from a second panel giving a macro perspective on the causes underlying mass protests and instability, namely, the major challenges to China’s economy and the likelihood that its high growth rate is not sustainable.
Micro Level Protests
The micro level view of social unrest indicates increasing protests over the past two decades. The latest data from the regime on the number of “mass incidents” is year 2008, when the regime prepared for the 2008 Olympics and afterward. Protests in Tibet were well publicized, but there were also, though less visible, significant incidents in Yunnan province: Weng’an, Guizhou, and Menglian, according to Dr. Murray Scot Tanner, an Asian security analyst at CNA.Despite heavy security, the total number of mass incidents by the end of 2008 had risen to 120,000, said Tanner. With the coming of economic downturn in 2009, it is quite possible the numbers climbed still higher in 2009 and 2010, according to Tanner.
Professor Xia Yeliang of Beijing University said in a Radio Free Asia interview that, according to the statistics from the CCP’s Political and Legal Committee, the number of group protests in 2009 rose to 230,000.
What is the nature of these protests? Dr. Elizabeth Economy, from the Council of Foreign Relations, listed land disputes, environmental issues and labor unrest. The Epoch Times and others have described eye-witness accounts of local officials expropriating land illegally and/or compensating well below market value.
Environmental protests may occur from “the failure of local officials and factory managers to enforce environmental regulations,” leading to riots, violence and deaths, testified Dr.Economy.
Labor issues are another growing source of unrest. Last year, workers achieved higher wages and better working conditions in the coastal area of China where there were labor shortages and better-educated workers. Strikes may be illegal in China but that didn’t deter the workers.
To Economy’s three major kinds of protests, Tanner would add withheld wages and pensions and “the refusal of local authorities to accept or honor citizen petitions.”
According to Tanner, it was not that there were more grievances that accounts for the steadily rising number of protests for two decades, but the absence of legal and political institutions that allow effective redress of grievances.
“Venting one’s frustrations in ways that are perceived to be taken seriously by the authorities are as important as actually resolving an issue,” said Yukon Huang, Carnegie Endowment for International Peace, on the second panel.
The first panel’s experts frequently mentioned the importance of the Internet and social media in the communication of social issues, for example, police beating protesters, and in helping to organize protests. As in Egypt and Tunisia, the Internet has become in China, “a virtual political system,” whereby a particular complaint or incident can be shown and in a matter of minutes “go viral,” said Dr. Economy.
Next: Recent calls for a ‘Jasmine Revolution’ in China began with a Twitter post
“Recent calls for a ‘Jasmine Revolution’ in China began with a Twitter post,” said Economy, who noted the role of social media in the Tunisian uprising. The plan called for protests in major Chinese cities on Feb. 20. The regime countered the plan by mobilizing thousands of police, “prominent dissidents were arrested, and edicts were issued to keep university students from leaving campuses,” said Economy.
Reporters Without Borders reported on Feb. 28 that foreign journalists were assaulted trying to cover a protest on Feb. 27 on Beijing’s Wangfujing Street in the commercial district. This protest was also inspired by the pro-democracy demonstrations in Tunisia. A Bloomberg News reporter was so badly beaten by plainclothes security men, the reporter had to be hospitalized for a head injury, according to the report.
Cameras were seized in order to delete photos and video, so they couldn’t be circulated for others to see and inspire more protests. The Reporters Without Borders report said a dozen journalists were held for several hours in a police station.
Through fast communication and monitoring the Internet, China’s security police suppressed these Internet-based protests, preventing the protest before it had a chance to be expressed. Yet, the reaction of the police is disproportionate to the threat, and the fear the regime holds seems irrational.
In a roundtable discussion following the panel discussions, Dr. Tanner spoke of his outrage that the authorities would severely suppress parents trying to get to the bottom of why their child was poisoned by contaminated milk. “These are not professional protesters, for heaven’s sake” he exclaimed.
Reporters Without Borders reported on Feb. 28 that foreign journalists were assaulted trying to cover a protest on Feb. 27 on Beijing’s Wangfujing Street in the commercial district. This protest was also inspired by the pro-democracy demonstrations in Tunisia. A Bloomberg News reporter was so badly beaten by plainclothes security men, the reporter had to be hospitalized for a head injury, according to the report.
Cameras were seized in order to delete photos and video, so they couldn’t be circulated for others to see and inspire more protests. The Reporters Without Borders report said a dozen journalists were held for several hours in a police station.
Through fast communication and monitoring the Internet, China’s security police suppressed these Internet-based protests, preventing the protest before it had a chance to be expressed. Yet, the reaction of the police is disproportionate to the threat, and the fear the regime holds seems irrational.
In a roundtable discussion following the panel discussions, Dr. Tanner spoke of his outrage that the authorities would severely suppress parents trying to get to the bottom of why their child was poisoned by contaminated milk. “These are not professional protesters, for heaven’s sake” he exclaimed.
Slower Growth Coming
China’s economic model of heavy investment and export-led growth has made China the second largest economy in the world, but it is not sustainable, according to economist Steven Dunaway, Council on Foreign Relations, at the hearing. Moreover, the structural economic distortions in China will be very hard to correct under the rule of the CCP, he said.
While the security police may try to keep ahead of the protesters and contain them, their controls can’t make a bad economy perform well. The CCP works on the premise that the China economy needs to grow at least 8 percent a year to generate sufficient employment, particularly for rural residents, to avoid “instability.” However, there is substantial doubt that China will be able to maintain rapid growth, said Dunaway.
Dr. Dunaway predicted that the China economic model of “heavy reliance on investments and exports to generate growth will not be able for much longer to continue to deliver rapid growth,” he said.
Dunaway said that for China to maintain its export growth it will have to take an ever-increasing share of world trade. However, “world trade is growing significantly slower now” and “all the major economies are looking to exports to provide stimulus for growth.” He said the efforts currently to hold up output growth by rapid credit growth runs the high risk of a high inflation rate.
He said Chinese officials’ holding to the target GDP growth of 8 percent is a mistake that will eventually lead to unacceptable inflation. There are signs of that already happening, he said.
It is possible for the economy to continue the rapid growth rate, but it would require “major changes in its economic policies and further substantial reforms in its economy,” Dr. Dunaway said. China needs to implement market-oriented economic reforms so that it moves away from the heavy investment, export-driven model to a greater dependence on domestic consumption to generate growth. There are inefficiencies and incentives favoring investments over consumption that need to be eliminated.
While the security police may try to keep ahead of the protesters and contain them, their controls can’t make a bad economy perform well. The CCP works on the premise that the China economy needs to grow at least 8 percent a year to generate sufficient employment, particularly for rural residents, to avoid “instability.” However, there is substantial doubt that China will be able to maintain rapid growth, said Dunaway.
Dr. Dunaway predicted that the China economic model of “heavy reliance on investments and exports to generate growth will not be able for much longer to continue to deliver rapid growth,” he said.
Dunaway said that for China to maintain its export growth it will have to take an ever-increasing share of world trade. However, “world trade is growing significantly slower now” and “all the major economies are looking to exports to provide stimulus for growth.” He said the efforts currently to hold up output growth by rapid credit growth runs the high risk of a high inflation rate.
He said Chinese officials’ holding to the target GDP growth of 8 percent is a mistake that will eventually lead to unacceptable inflation. There are signs of that already happening, he said.
It is possible for the economy to continue the rapid growth rate, but it would require “major changes in its economic policies and further substantial reforms in its economy,” Dr. Dunaway said. China needs to implement market-oriented economic reforms so that it moves away from the heavy investment, export-driven model to a greater dependence on domestic consumption to generate growth. There are inefficiencies and incentives favoring investments over consumption that need to be eliminated.
Interference with Market Forces
These changes are being impeded or even blocked by the CCP in a number of ways, according to Dr. Dunaway. Other countries in East Asia, which were controlled by single-party governments, such as Malaysia, Korea, Singapore, and Taiwan, sustained rapid economic growth.
“But these countries [had] been willing and able to separate economic and economic control,” he said, saying that this is essential to correct the “distortions” in the China’s economy, including prices, interest rates, monetary policy and the exchange rate. The heavy-handedness of the CCP, severely limits the development of a more market-oriented economy, and he argues, “undermines China’s ability to maintain rapid growth.”
At the same time, the supremacy of the CCP makes it much more difficult for the rule of law to be established. The Party is not allowing the courts to be the final arbiter of disputes. But the rule of law is fundamental for sustaining economic development because individuals and firms rely on law to protect contracts and property rights.
It would appear that high economic growth is not sustainable without incurring high inflation and more “distortions” in the economy. When the growth rate, drops, China will become more vulnerable to protests, which may lead to social and political change.
“But these countries [had] been willing and able to separate economic and economic control,” he said, saying that this is essential to correct the “distortions” in the China’s economy, including prices, interest rates, monetary policy and the exchange rate. The heavy-handedness of the CCP, severely limits the development of a more market-oriented economy, and he argues, “undermines China’s ability to maintain rapid growth.”
At the same time, the supremacy of the CCP makes it much more difficult for the rule of law to be established. The Party is not allowing the courts to be the final arbiter of disputes. But the rule of law is fundamental for sustaining economic development because individuals and firms rely on law to protect contracts and property rights.
It would appear that high economic growth is not sustainable without incurring high inflation and more “distortions” in the economy. When the growth rate, drops, China will become more vulnerable to protests, which may lead to social and political change.
