Teaching Comparative Government and Politics

Friday, January 25, 2013

Socialism with inequality

Chinese leaders like to talk about socialism with Chinese characteristics. It seems that growing economic inequality is one of those Chinese characteristics.

Gap between China’s rich and poor can't be hidden in Chongqing

The large and growing gap between China’s rich and poor is one of the most obvious challenges facing the country’s new paramount leader, Xi Jinping, who will take over as president from Hu Jintao in March. In a signal the new leadership at least wants to start discussing the problem, the National Bureau of Statistics last week revealed the country’s Gini coefficient – which measures income inequality – for the first time in more than a decade.

As the official Xinhua newswire put it, the number “paints a far-from-rosy picture of what the country needs to do to bridge the wealth gap and make more people included in its magnificent growth story.”

The official figure of 0.474 is a belated acknowledgment that China has a serious problem. On the Gini scale, 0 is perfect equality and 1 is total inequality – any rating above 0.4 is considered to be dangerous to social stability. But the country’s chief statistician, Ma Jiantang, also made an eyebrow-raising assertion: that Chinese society has been getting more equal each year since 2008, when the Gini coefficient peaked at 0.491.

That seems at odds with the realities on the streets of a place like Chongqing, where it’s increasingly common to see luxury sports cars swerving through streets clogged by three-wheeled taxis. Indeed, a study conducted last year by the Chengdu-based Survey and Research Centre for China Household Finance concluded the Gini coefficient ACTUALLY stood at 0.61 in 2010, which would put China among the most unequal societies in the world…