The Challenges for China’s New Leadership

China’s Safety Net Shackled to Family Registers


China has become the world’s number two economy, but it is still a country with huge economic disparities. Some of the gaps are connected to the household registration system, which divides the population between urban and rural residents. Today this system is generating discontent and complicating the construction of a safety net.

Defining “Stability” in the Chinese Context

During a trip to Beijing in August 2012, I met a Chinese friend who is a journalist. He happened to be writing an article on the changes in Japanese society from the high-growth period to the present. Having picked up experience in Japan during his studies here, he made this observation: “It seems to me that compared with China, Japan has remained remarkably stable in the face of recent difficult changes, such as mounting fiscal deficits and a contracting population. Cities are clean and people are polite. And because the necessary systems are in place, social confusion does not arise as a result of the tendency for prime ministers to fall from power after only a short time in office.”

Depending on one’s perspective, Japan does indeed appear to be a stable country, especially if you have been spending your time looking mainly at the more dispiriting side of China, with its poverty and corruption, as this journalist had. While anti-Chinese sentiment may have strengthened to some extent lately, it has not triggered the kind of violent behavior seen during September in China’s widespread anti-Japanese protests. But might it not be said that the people of Japan and China, which differ in such terms as population scale, land size, cultural background, and international standing, also have differing views of how social stability should be defined?

When evaluating how stable their lives are, people naturally give thought to the safety net constructed by their government to protect them, but by no means is that all they consider. Perceptions of stability and instability take shape in a context influenced by the family, the community, and various other social and cultural factors. It might be said that when a country acts to strengthen its safety net by drafting and implementing policy measures, it needs above all to get a firm grasp on the essential elements of stability as perceived by the public. Furthermore, the safety net will also be affected by whether people do or do not place trust in the government and endorse its legitimacy.

Migrant Labor in the Family Register System

Not surprisingly, the creation of a safety net is not easily accomplished in a country that has glaring economic disparities. Japan has also seen a widening of inequalities in recent years, with low-income families and workers engaged in nonregular employment, such as temporary or part-time work, falling further behind those who are well off. In purely monetary terms, however, the gap between rich and poor in China is much wider. The National Bureau of Statistics of China reports that as of 2011, urban residents had annual per capita disposable income of 21,810 yuan (approximately $3500 or ¥27,800), which is 3.1 times larger than the net per capita income of 6,977 yuan for rural residents. Pointing out that the income figures of the farming population includes cash equivalents of grain and other crops that the farmers consume, some economists say that urban residents are actually five or six times better off. In Japan, by contrast, average annual income was ¥3.2 million in Okinawa, the poorest prefecture, some ¥2.7 million below the level in Tokyo, the richest (according to the basic wage structure survey of the Ministry of Health, Labor, and Welfare). Tokyoites, in other words, were only about 1.8 times wealthier than Okinawans.

The gulf between China’s least and most affluent regions is about as wide as the distance between the world’s developing and advanced nations. In fact, the typical annual income of poor farmers is less than even the monthly income of standard wage earners in big cities. And because of these yawning regional disparities, the Chinese government is in no position to dismantle the system of household registration known as the hukou system, despite the unsavory reputation it has acquired.

The Chinese government introduced the hukou system in the 1950s in order to control the movement of people from rural to urban areas. It also had its sights set on accelerating capital formation in heavy industries, holding down agricultural product prices, and giving preference to urban residents in the distribution of health and welfare benefits. Food rations and other consumer goods, housing, and jobs were made available only to holders of an urban registration record. Rural residents became unable to change their hukou status and move to a city except in certain cases, such as by securing an urban job through a special route or by gaining employment after graduating from a city school.

The restrictions on movement were eased after China shifted course toward reform and opening in 1978, and today there are nearly 200 million Chinese classified as nongmin gong: migrant laborers who remain registered as rural residents but are working in urban areas. Though their classification can be translated as “farm workers,” they are not engaged in farming. They are simply workers in urban districts who continue to be treated as rural residents. They are unable to dissociate themselves from the farming label because if the hukou regulations were scrapped, cities would find themselves with populations too large to handle. More public services would have to be provided, and costs would skyrocket.

Workers classified as nongmin gong are considered to be temporary urban residents who are not eligible for many social services. Walking around the parts of Beijing where many migrant workers are living, one comes across quite a few residences that are marked with red crosses, signifying that they are “black clinics.” These are illegal clinics, but they have proliferated because they are affordable. The costs of treatment in authorized clinics and hospitals are high. Even when rural residents are enrolled in a health insurance plan in their hometown, they must bear a larger portion of the bill if they seek treatment elsewhere, such as at an urban medical center. Staff members without proper qualifications provide much of the care at illegal clinics, and medical mistakes are not uncommon. The clinics are also involved in the illegal but rampant practice of using ultrasound to determine the gender of the fetus and performing an abortion if the fetus is female. Parents opting for selective abortions continue to be numerous because pension systems are not well developed in rural communities, causing people to worry about life in old age if they do not have a son to rely on.

Education and Employment Woes of Outsiders

Even white-collar workers graduating from city universities encounter restrictions on acquisition of urban hukou. According to a friend who is an associate professor at China University of Political Science and Law, one of the prestigious “national key universities,” students who come from places outside Beijing have a hard time landing a job in the capital city. If they cannot secure a position in the public sector, where they might work for the police, the prosecutor’s office, the courts, or a state-owned enterprise, they must seek employment elsewhere.

Shanghai also has strict controls on granting urban hukou to people who move into the city, but it offers one-year, three-year, and five-year residence permits to school graduates based on their total points in a rating system. The score combines such factors as the rank of the school they graduate from, their academic record, the status of their health, their foreign language and computer qualifications, and the reputation and working conditions of the company that hires them. Some 370,000 people were holders of these permits as of September 2011. Still, they were a mere drop in the bucket among the nine million temporary residents living in Shanghai without a registration record for the city (Jingji Guangcha Bao, September 10, 2012). About 80% of the graduates who have acquired a permit have a postgraduate degree, placing them in the elite. Even so, the only pension they are able to receive on retirement after working many years in Shanghai will be one issued by their registered place of residence. And the only part of the benefits they are eligible for corresponds to what they themselves have paid into the pension, since payments by their employer are disregarded.

The children of families with temporary residence permits encounter serious discrimination in schooling. Basically, they can receive elementary and secondary education in the city where their parents are working, but if they wish to go on to higher education, they must return to the place where their hukouis. Data released by China’s Ministry of Education show that as of 2011, there were 12.6 million children living with their parents and studying in schools without a local registration record. If, at high school age, they move to the region where they are registered in order to prepare for college entrance examinations, their academic performance is apt to drop sharply, because the curriculum varies among regions.

Colleges and universities, meanwhile, set the passing mark on their entrance examinations at a level facilitating the admission of local students. It is said that Beijing students with an exam score good enough to enter a top-rate university would only be able to get into a two-year junior college if they took the exam in some other region. About 80% of high school students with a Beijing hukou pass their exams for entry into a college or university, but the success rate is only about 50% for graduates who leave Beijing to take exams for higher education in the place where their registration record is. The Beijing Municipal Education Commission reports that in 2009, among the children of the city’s 40,000 inhabitants holding temporary residence permits, 700 returned to the place of their official residence to take exams for entry into higher education (Nanfang Zhoumo, August 5, 2009).

Patience and Self-Reliance Born of Confucianism and Socialism

In this way, the hurdles are high for those without a registration record for the place where they are living. High school students may be unable to receive higher education, and even if they succeed, they will face discrimination when they apply for a job. The lack of proper local documentation is also a disadvantage for access to pensions and other systems.

If this sort of unfairness became conspicuous in Japan, loud criticism of the government could be expected. In China as well, parents with temporary residence permits in Beijing argue that their children ought to be able to take the entrance exams to the city’s colleges and universities. On a number of occasions they have made requests to this effect to members of the National People’s Congress and the Beijing Municipal People’s Congress. Calling for correction to the unfairness in education, several hundred of them formed a network on the Internet and collected more than 2,000 signatures for a proposal they presented in April 2010 to the Beijing Municipal Education Commission.

As yet, however, there has been no nationwide protest movement. Why is this? Of course, part of the answer is the lack of room to maneuver when freedom of speech and assembly are not guaranteed and access to the courts is blocked. But another reason could be that as a result of Confucian culture and the structure of socialist rule, Chinese society has acquired a greater capacity for perseverance. China is a huge country in which it is not easy by any means for the authorities to impose uniform systems and policies across the whole nation, and a certain degree of distance separates the state and government from the people. Recognizing that they cannot expect the state and its systems to take care of them, people have been compelled to develop a strong degree of self-reliance.

Self-reliance takes shape as mutual support through family and community bonds of solidarity. When I talk to people in China about how my husband has been posted to work in China and I have to look after our two-year-old child by myself, they always show much surprise. Many Chinese take it for granted that grandparents will step in to look after grandchildren. Most Japanese do not feel such a strong sense of obligation to come to the aid of family members. The Chinese willingly lend money to family members and relatives, but the Japanese are not inclined to engage actively in such lending. Among the Chinese farming communities I have studied, I found that in regions where traditional values were deeply rooted, the work of irrigation and road construction was proceeding smoothly.

On my recent visit to the village of Xinhe in Shayang, Hubei Province, I found more farmland developed through public investment and worked using farm machinery. More farmers now rely on the help of machinery owners for harvesting. With young people going away to work, the local population is rapidly aging. In the picture on the right, members of the village elderly association are demonstrating waist-drum dancing.

The Fragile Foundation of Chinese Stability

At the same time, there are areas in which traditional Chinese culture with its strong emphasis on human relations is causing problems. For instance, connections are frequently abused to line up jobs and gain admission to schools. Widespread anger has been voiced over incidents in which the children of officials and the wealthy have not been properly punished for causing traffic accidents and even for committing murders.

As can be seen in the hukou system, the Chinese cannot expect equal protection of human rights among all citizens. During the recent anti-Japanese protests, demonstators carrying placards with images of Mao Zedong could be seen. They were expressing discontent with life and the message was that there was more equality during the days of Mao’s rule. Many of these unhappy citizens were China’s outsiders, people without a registration record for their place of residence.

Stressing that China is still a developing country, the government states that it attaches importance to “social rights.”(*1) In recent years, however, the authorities have often impeded the activities of lawyers, blocked the submission of petitions, and trampled on the right to freedom in other flagrant ways, justifying their actions by saying that they are only trying to maintain social stability.

Room for engaging in debate has been dramatically expanded by the advent of the Internet. There can be no doubt that China’s leaders are frightened by the rise of “Internet democracy.” After all, the people did not select their government through democratic procedures, and the authorities are worried about how they can sustain the government’s legitimacy. In this light, it can be said that stability in China is underpinned by a fragile political foundation.

Even in mature democratic states, the pursuit of freedom and equality has no end. Japanese politics has been bedeviled for years by problems involving unequal weights of voters’ ballots, and arguments have erupted over the poor treatment accorded to nonregular employees and the amount of assistance provided through welfare systems. Nonetheless, the world’s democracies differ from contemporary China in that they have strong systems guaranteeing free speech and giving people opportunities to participate in politics. These systems play an important role in curbing reckless behavior by those in power.

In short, though China may be a country in which conditions have fostered perseverance and self-reliance, thereby restraining expectations toward government, its ability to guarantee even and just social rights will be threatened if it goes too far in suppressing the right to freedom and allows disparities to widen to alarming degrees. It could end up becoming unable to hold down discontent, and without firm roots, the country’s superficial stability could crumble. In order to secure the foundation of the safety net, China must enable both systems and human networks to function organically in the context of mutual support among self-reliant individuals. This is the message China’s example is sending to the world.

(Originally written in Japanese in September 2012. Photos Courtesy of Ako Tomoko)

(*1) ^ The concept of social rights includes the right to live, the right to education, basic rights to work, and eligibility for social security. The right to freedom, by contrast, embraces various civil and political privileges of the individual, including the right to life, religious freedom, freedom of speech and assembly, the right to vote, the right to due process of law, and the right to a fair trial. China has signed and ratified the International Covenant on Economic, Social, and Cultural Rights under the International Bill of Human Rights of the United Nations, but while it has also signed the International Covenant on Civil and Political Rights, it has not ratified it.

China farming Chinese Beijing Ako Tomoko urban rural registration safety net National Bureau of Statistics of China hukou nongmin gong migrant workers farm Jingji Guangcha Bao Nanfang Zhoumo stability Confucianism Socialism Shanghai Mao Zedong China University of Political Science and Law social rights right to freedom