China: Looking A Lot Like America After 30 Years
Wendy Liu
January 30, 2009
People say that opposites attract. That was certainly true with the US and China 30 years ago when they tied the diplomatic knot. People also say that couples can grow to look like each other after. That may also be true with the US and China today, joined at the hip, economically at least, after 30 years of an intense relationship.
But Americans should be happy, because it is China that has become more like America than the other way round. Imitation, after all, is the sincerest form of flattery.
Here are a few "before and after" shots of China. One may be surprised at how much the "after" ones look like America.
Homeownership. 30 years ago, very few urban Chinese owned their homes, although rural Chinese had always owned their shabby housing. Most urban Chinese lived in government-owned and -subsidized apartments allocated through their "work unit," or employer, if their seniority qualified them. Living until early 1980s in Xi´an, a big city and my hometown, I knew but one friend whose family owned their home.
Today, China is the new "Ownership Society" that will make former President Bush proud. Homeownership among urban Chinese has soared past 80%, as calculated by China´s Ministry of Housing and Urban-Rural Development. That´s higher than American homeownership at 67% in 2008, according to the US Census Bureau. Even though some question China´s homeownership rate, there is no mistaking that most Chinese today live in private housing. Many of my relatives in China are now homeowners, realizing their "Chinese Dream."
Private sector. 30 years ago, private sector was near non-existent in China. 70% of the workforce was in agriculture, working under the commune system. Of the other 30%, the urban Chinese, most worked for the state or state-owned-enterprises (SOEs), with only 0.2% of them employed in private sector, according to China´s National Bureau of Statistics. I never knew who exactly represented that special percentage. All private business I saw in those years was tea peddling or popsicle hawking.
Today, China is dominantly a private economy, as pointed out by Fan Gang, a prominent Chinese economist. Thanks to the successful reform and privatization of its SOEs, China´s private sector now accounts for 70% of its GDP and employs over 75% of the urban workforce. That´s not too different from the picture in America, where over 10% of the workforce was in the public sector in 2007, according to the Census Bureau. As for China´s agricultural employment, urbanization has reduced it to 40% of the workforce. With the communes long gone, the Chinese farmers now work for themselves. Although not landowners yet, a new policy allows them to lease their contracted farmland or transfer land-use rights.
Rich-Poor Gap. 30 years ago, all Chinese citizens were poor, equally poor. While rural Chinese earned work points and received pay in kind, most urban Chinese made a small salary less than 100 yuan. As a young government staffer in Xi´an who worked for American Vice President Walter Mondale´s delegation visiting in 1979, I made 48 yuan a month. High-ranking government officials may have had better housing, but they didn´t own it. They were as proletarian, or property-less, as everyone else.
Today, China has one of the world´s widest gaps between rich and poor. On the one hand, there is the annual China Rich List published by Rupert Hoogewerf in his China-based Hurun Report. In 2007, Hurun identified 106 billionaires in China. As for millionaires, the number was 391,000 in 2008, said People´s Daily. On the other hand, there are migrant workers risking their lives in unsafe coalmines, families begging on the streets, and young girls selling their bodies. If top 10% richest Americans owned nearly 70% of America´s wealth, as indicated in 2006 by the World Institute for Development Economics Research, top 10% richest Chinese owned 45% of China´s wealth in 2005, China Daily reported. In terms of Gini coefficient, a measure of inequality, China´s reached 47.3 in 2004, as estimated by the Asian Development Bank, "beating" US inequality at 46.3 in 2007!
There are many aspects of life in China today that mirror America: bankruptcies, strikes, etc. There are also others one wishes to see become more like America: free press, or lack of, for instance. But who could have imagined 30 years ago that citizens of socialist China would today own homes, work for private companies and worry about wealth distribution, just like the Americans?
If it was the attraction of their oppositeness that brought the US and China together in 1979, it would be their messy yet inseparable bond of shared interests that will keep them going beyond 2009.
But Americans should be happy, because it is China that has become more like America than the other way round. Imitation, after all, is the sincerest form of flattery.
Here are a few "before and after" shots of China. One may be surprised at how much the "after" ones look like America.
Homeownership. 30 years ago, very few urban Chinese owned their homes, although rural Chinese had always owned their shabby housing. Most urban Chinese lived in government-owned and -subsidized apartments allocated through their "work unit," or employer, if their seniority qualified them. Living until early 1980s in Xi´an, a big city and my hometown, I knew but one friend whose family owned their home.
Today, China is the new "Ownership Society" that will make former President Bush proud. Homeownership among urban Chinese has soared past 80%, as calculated by China´s Ministry of Housing and Urban-Rural Development. That´s higher than American homeownership at 67% in 2008, according to the US Census Bureau. Even though some question China´s homeownership rate, there is no mistaking that most Chinese today live in private housing. Many of my relatives in China are now homeowners, realizing their "Chinese Dream."
Private sector. 30 years ago, private sector was near non-existent in China. 70% of the workforce was in agriculture, working under the commune system. Of the other 30%, the urban Chinese, most worked for the state or state-owned-enterprises (SOEs), with only 0.2% of them employed in private sector, according to China´s National Bureau of Statistics. I never knew who exactly represented that special percentage. All private business I saw in those years was tea peddling or popsicle hawking.
Today, China is dominantly a private economy, as pointed out by Fan Gang, a prominent Chinese economist. Thanks to the successful reform and privatization of its SOEs, China´s private sector now accounts for 70% of its GDP and employs over 75% of the urban workforce. That´s not too different from the picture in America, where over 10% of the workforce was in the public sector in 2007, according to the Census Bureau. As for China´s agricultural employment, urbanization has reduced it to 40% of the workforce. With the communes long gone, the Chinese farmers now work for themselves. Although not landowners yet, a new policy allows them to lease their contracted farmland or transfer land-use rights.
Rich-Poor Gap. 30 years ago, all Chinese citizens were poor, equally poor. While rural Chinese earned work points and received pay in kind, most urban Chinese made a small salary less than 100 yuan. As a young government staffer in Xi´an who worked for American Vice President Walter Mondale´s delegation visiting in 1979, I made 48 yuan a month. High-ranking government officials may have had better housing, but they didn´t own it. They were as proletarian, or property-less, as everyone else.
Today, China has one of the world´s widest gaps between rich and poor. On the one hand, there is the annual China Rich List published by Rupert Hoogewerf in his China-based Hurun Report. In 2007, Hurun identified 106 billionaires in China. As for millionaires, the number was 391,000 in 2008, said People´s Daily. On the other hand, there are migrant workers risking their lives in unsafe coalmines, families begging on the streets, and young girls selling their bodies. If top 10% richest Americans owned nearly 70% of America´s wealth, as indicated in 2006 by the World Institute for Development Economics Research, top 10% richest Chinese owned 45% of China´s wealth in 2005, China Daily reported. In terms of Gini coefficient, a measure of inequality, China´s reached 47.3 in 2004, as estimated by the Asian Development Bank, "beating" US inequality at 46.3 in 2007!
There are many aspects of life in China today that mirror America: bankruptcies, strikes, etc. There are also others one wishes to see become more like America: free press, or lack of, for instance. But who could have imagined 30 years ago that citizens of socialist China would today own homes, work for private companies and worry about wealth distribution, just like the Americans?
If it was the attraction of their oppositeness that brought the US and China together in 1979, it would be their messy yet inseparable bond of shared interests that will keep them going beyond 2009.
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