Commentary
For a week in mid-July, the Third Plenum of the Chinese Communist Party (CCP)’s 20th Central Committee debated the country’s future.
Deriving their names from their occurrence approximately halfway between each Central Committee’s five-year cycle, previous Third Plenums have heralded important changes in the governance of the People’s Republic of China (PRC).
The 11th Central Committee in 1978 saw the opening of the PRC to foreign influence and rapid growth, the demise of Mao Zedong’s planned economy, and the installation of Deng Xiaoping as de facto leader. At the 14th Central Committee in 1993, Deng’s successor, Jiang Zemin, called for the establishment of a socialist market economy by the end of the 20th century and introduced reforms to encourage private enterprise and reform the inefficient state-owned enterprises. The 18th Central Committee in 2013, and the first under Xi Jinping, revised the banking system and modified the draconian one-child policy. The 19th Central Committee in 2018 is best known for abolishing term limits to enable Xi to remain in power for as long as he wishes.
Hence the anticipation of the Third Plenum in 2024. There was broad agreement on the mounting problems facing China, foremost among which are sluggish economic growth, a declining and aging population, high youth unemployment, an estimated $7 trillion to $11 trillion of local debt, regional imbalances, maldistribution of income, and corruption.
One can find hints of intent to address salient issues: There should be a “collaborative mechanism for the orderly transfer of industries within the country, and the sharing of benefits between the transfer-out and receiving areas.”
The issue of pensions for the ever-larger numbers of retirees has been much on policymakers’ minds, resulting in the communiqué’s suggestion that the statutory retirement age should be gradually raised “in a prudent and orderly manner” from the current 60 for men and 55 for women in white-collar work, 50 for women in manual labor. While there has been no public outpouring of anger remotely comparable to that following French President Emmanuel Macron’s effort to raise the retirement age in his country, adverse comments on social media quickly disappeared, indicating that the internet censorship system had been alerted.
At the other end of the lifespan spectrum, the communiqué envisions the improvement of the system of maternity leaves and the establishment of subsidies for childbirth. So far, even a further relaxation of the one-child policy to a three-child policy has been met with indifference by those of childbearing age. Xi’s government addressing complaints that it is simply too expensive to raise even one child by banning expensive after-school tutoring programs has been ineffective—as well as, in many cases, circumvented by sundry ruses by the motivated such as hiring private “dancing teachers” who are actually math instructors.
With regard to the urban-rural gap, there is consensus on the need to reform the household registration system that was originally intended to avoid a massive flow of population from the countryside to cities by tying people to where they were born. Widely evaded since Deng’s industrial reforms, it created an underclass of millions who live in cities without the rights that accrue to those with urban registration.
A central-level reform is needed since previous efforts to allow cities to set their own policies have resulted in widespread local responses that make it difficult to change registration so the municipalities can avoid the costs they would bear from their now-legal residents in such areas as health care and education. There is also the problem of how to transfer the land rights of peasants who become legal city dwellers.
As for tax reform issues, particularly reforms that can address local debt issues. Beijing controls a far greater amount of revenue than local governments, which nonetheless bear the responsibility for many costs in their areas—a problem made worse by a three-year-long crisis in the property market. Yet revenue transfers would reduce the central government’s leverage over these areas and encourage ever-present centrifugal forces. Finding the right balance among Party, central state, local governments, state-owned enterprises, and the private sector is a conundrum with no easy answers. No formula has been devised on how to transition the economy from a credit-driven high-growth model characterized by heavy investment in infrastructure and real estate to the model envisioned by Xi, which is dominated by high-tech industries and green development.
Promises to deal with corruption essentially repeat the same formulas that have not worked since Xi began his campaign against it over a decade ago. Improving the working mechanism to promote the “dare not, cannot, and do not want to” corruption by eradicating the conditions under which it flourishes and better investigating unhealthy practices are ideational rather than practical solutions.
For people of religious faith and ethnic minorities, there was little comfort in the Third Plenum’s communiqué. The need for unity among the entire nation is considered an integral part of China’s rejuvenation, hence necessitating the systematic Sinicization of religion and the formulation of a law to promote “ethnic unity and progress.”
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
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