Erik Nilsson

Rural political reform for the benefit of all

By Erik Nilsson (China Daily)
Updated: 2010-01-27 07:06

The draft legislation that would equalize the proportion of rural and urban representatives to policymaking bodies would go beyond expanding countryside residents' suffrage to help rebalance China's lopsided wealth distribution.

This will ultimately benefit not only those who live in the hinterlands, but also society as a whole.

The proposed amendment to the Electoral Law would require an even ratio of urban and rural delegates to the people's congresses, the decision-making bodies that drive the country's legislative system.

The last amendment to the law, made in 1995, put the ratio at four urban representatives for every rural delegate. That means, "every 960,000 rural residents and every 240,000 urbanites were represented by one National People's Congress (NPC) deputy" each, the NPC website says. In other words, rural residents have enjoyed about one-quarter of the suffrage of their urban counterparts. This expansion of rural residents' legislative influence will ultimately translate into their greater capability to score wins for their economic interests through the political system.

City residents may know and genuinely care about the problems faced by those living in the countryside. But nobody is more familiar with the obstacles to, or has a greater interest in, improving rural residents' conditions than they themselves.

The importance of increasing rural incomes extends even beyond raising the demographic's living standards.

Increasingly, the government recognizes that the widening wealth disparity poses one of the greatest threats to social stability and economic development. The income gap traces the fracture lines of several societal divisions - east versus west, coastal versus inland - but perhaps the sharpest fissure exists between the urban and rural.

Pundits are worried because they realize that intensifying discontent among those left behind by the country's full-speed-ahead development could erupt into social unrest.

But also, the lesson from the global economic downturn, which became clear when overseas demand for Chinese goods shrunk, is the danger of reliance on exports. That is why much of the State Council's 4 trillion-yuan ($586 billion) stimulus package was devoted to encouraging domestic spending, with significant amounts flowing to rural areas.

The money funded subsidies for farmers to buy commodities such as vehicles and household appliances. The government improved social services, such as subsidized healthcare, enabling rural residents to spend rather than save for emergencies such as serious medical procedures. And bank loans to rural residents grew by 33 percent last year, according to People's Bank of China, the country's central bank.

But while consumption increased, it was not the main engine that propelled last year's 8.7 percent economic growth. The country still relied on the crutches of investment and exports to carry its weight as it marched through the global economic downturn.

China's consumption to GDP ratio still hovers below 40 percent, about 30 percent less than developed countries'. Officials from government bodies such as the National Development and Reform Commission voice concerns over overproducing for insufficient markets. And planners highlight the need to boost domestic consumption as the starting line for national growth's "second phase" since the reform and opening up began. Until now, most rural citizens, who account for 53 percent of the population, have had few chances to become consumers in the real sense of the term because of low incomes. But the new legislation will expand their political power and enable them to increase their earning and, consequently, their spending power. It will also enable them to improve their living standards beyond increased incomes.

They will be better positioned to improve the working conditions for farmers who become migrant workers in cities. And they can expand their social safety net by gaining more say on issues such as healthcare, while wielding more direct influence on issues central to their lives, such as agricultural reform.

Surely, equalizing the political representation of the rural population will help equalize the imbalances that exist in society - and do so for the benefit of all.

(China Daily 01/27/2010 page9)