The Challenge for China's New Leaders

The Dangers of Allowing Inequality to Worsen

When Deng Xiaoping opened up the Chinese economy three decades ago, he did so on the premise that economic liberalization would precede political liberalization. For an impoverished generation that was still coping with the excesses of the Cultural Revolution, the chance at a better material life far outweighed the need for political expression. That trade-off held for many years; as recently as 2008, China topped the list of 24 countries included in the Pew Global Attitudes survey for its citizens' satisfaction with their nation's economy.

Recently, however, talk of a political transformation in Beijing is showing signs of renewal. A growing, newly socially conscious middle class has taken to the streets to decry the government's response to the 2008 tainted milk scandal, to the 2008 Sichuan earthquake, and to the harsh working conditions for migrant laborers in factories such as the electronics manufacturing firm Foxconn, which was the subject of a globally publicized inspection just last month. These instances of unrest -- and they are but a few of many -- expose a growing discontent with three fundamental facets of China's modern rise. For one, Beijing's distinct economic management style has created vast inequality. Second, the economic system has led to almost intractable disputes over a finite resource -- land. And third, the Chinese system relies heavily on migrant workers, who are stripped of many rights and protections, and therefore all the more likely to protest.

These problems reflect the failure of Beijing's reform agenda in recent years. There were plans to strengthen the fiscal system to address social equality and distribution imbalances during a time of rapid growth. Rigid controls over the use of key resources such as land and labor have created distortions that exacerbate social tensions. And this leaves a question for the next generation of leaders to be ordained later this year: Are they willing to tackle the many vested interests that have impeded change thus far and set China on a sustainable path into the future?

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