Thursday, October 21, 2010

China’s Dilemma? What about the U.S.?

There is a short article by George J. Gilboy and Eric Heginbotham titled “China’s Dilemma: Social Change and Political Reform” that can be found on the “Foreign Affairs” website. As the title suggests it discusses all the social pressures that are being activated by China’s changing economy and its changing social structures. The authors point out that the China’s rulers are cognizant of these pressures and respond to them appropriately. The real issue is whether the Chinese Communist Party (CCP) will respond fast enough in order to forestall any significant social unrest. The authors point out that the natives are in fact getting restless.

“The Chinese Academy of Social Sciences (CASS) estimates that incidents of social unrest have risen from about 40,000 in 2001 to “over 90,000” in 2009. CASS also reports that these incidents are becoming larger, more violent, more likely to cross provincial borders, and more diverse in terms of participants and grievances.”

“Increased misappropriation of land, rising income inequality, and corruption are among the most contentious issues for Chinese society. China’s State Development Research Center estimates that from 1996 to 2006, officials and their business cronies illegally seized more than 4,000 square miles of land per year. In that time, 80 million peasants lost their homes. Yu Jianrong, a senior government researcher, has said that land issues represent one of the most serious political crises the CCP faces.”

“China’s wealth gaps have also grown; according to Chinese media, the country’s GINI coefficient, a measure of income inequality, has risen to about 0.47. This level rivals those seen in Latin America, one of the most unequal regions in the world.”

So, the Chinese are worried because their Gini coefficient has risen to 0.47. Guess who also has a Gini coefficient of 0.47? That of the U.S. was calculated to be 0.468 in 2009—and rising.

We are proud of the fact that we have such high income inequality and do not even worry about it. It is a bit troubling that the Chinese seem to have surpassed us in terms of social unrest, and seem to be not far behind in making people homeless, and in corruption. Perhaps we need to enhance our efforts in all these areas if we are to maintain the world leadership we so justly deserve.

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