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As the economy falters, resentment between social groups is growing

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THE TERM “three generations in tobacco” has become a common shorthand in China. On social media it means a privileged elite whose members hand out coveted jobs (such as managerial roles in the state’s tobacco monopoly) to their own types. Earlier this year a microblogger with more than 850,000 followers invoked the meme. “The result of this hereditary system is a closed circle of power that completely cuts off opportunities for people at the bottom to rise up!” he wrote. Hundreds expressed agreement. “The ruling class is solidifying,” one replied. Another fumed: “The children of the elite get ahead, and the children of the poor remain poor.”

In the 1990s, as people became free to move from the countryside into cities and to choose what work to do, social mobility soared. With hard work and native wit, the transformation from farmer to factory owner could be completed in a matter of years. But as the meme suggests, optimism is beginning to fade. The economy is faltering. Opportunities for good jobs are drying up. Many Chinese now talk of shehui guhua, or social stagnation. Among the less well-off, resentment is growing of what is seen as a self-replicating elite. Class enmity is on the rise.

Research led by two American scholars, Scott Rozelle and Martin Whyte, found that people in China once accepted glaring inequality, remaining optimistic that with hard work and ability they could still succeed. But the academics found they are now more likely to say that connections and growing up rich are the keys to success. This irks the Communist Party, which claims to have established a “people’s democratic dictatorship led by the working class and based on an alliance of workers and peasants”, as the Chinese constitution puts it. In recent years China’s leader, Xi Jinping, has called for greater efforts to promote social mobility while stressing the need to attain “common prosperity”.

Such talk has had little obvious impact on the public mood, however, beyond spooking businesspeople and wealthier Chinese. In August a popular user of Weibo, a social-media site, railed against the big pensions enjoyed by the elite. “Common folk, do you get it now?…Vested interests are untouchable, you can’t even talk about them,” he wrote. “They’re all parasites,” one person responded. “Vampires,” said another. “Social stagnation is getting worse,” a third chimed in. Someone even ventured: “Without another revolution, it’s impossible to resolve these bizarre injustices.” Within days the thread disappeared from China’s heavily censored internet.

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Is China really becoming more socially rigid? Experts debate the evidence. A common way of measuring mobility is by looking at what economists call intergenerational elasticity of income, or IGE. It compares people’s incomes with those of their parents. The closer they are, the less difference there is likely to be between the two generations’ social status. IGE represents the ratio on a scale of zero to one, with a higher number indicating less mobility.

A study published in 2019 by the Institute of Labour Economics, a think-tank in Bonn, found that the IGE of those born between 1970 and 1980 was 0.39. It rose to 0.44 for those born between 1981 and 1988. As in rich countries, the authors say, the reduction of social mobility went hand in hand with growing inequality. The gap between rich and poor in China rose sharply in the 1990s as economic reforms took off. In another paper, also published in 2019, Mengjie Jin of Nanjing University of Finance and Economics and fellow authors said the country was more socially mobile than America, but less so than Britain, Canada and Germany.

Mr Xi does not admit that social stagnation is happening, but he has called for efforts to prevent it. “In some countries, the widening gap between rich and poor and the collapse of the middle class have led to social division, political polarisation and rampant populism,” he said in 2021. “The lessons are profoundly significant!” In July Han Linxiu of Nankai University, writing in an official journal, said he did not believe there was stagnation but “the widespread presence of this negative emotion” was “a potential political risk”.

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The C-word

To tackle the problem, the party in 2019 issued its first policy document on the topic of social mobility. As usual, when discussing China, it did not mention the word “class”. The idea that new ones might be forming remains unpalatable to the party’s ideologues. But it said that eliminating barriers to mobility would be “a powerful support for the sustained and healthy development of the economy”. And it correctly identified some of the main obstacles.

The most glaring one is the hukou system of household registration, which limits the ability of migrants from the countryside to get access to subsidised urban health care, education and housing. The nearly 300m who have moved into cities in the past three decades have enjoyed a one-off gain in social standing. But in the cities they are treated as second-class, often barred from good jobs because of requirements that applicants have a local hukou.

The party’s document called for the “equalisation of basic public services…regardless of hukou status”. Reforms have been gaining pace. Some offer migrants with permanent jobs the chance to enjoy the same benefits as native residents, even without changing hukou. But there are still hidden barriers: many migrants do not have contracts to prove their employment or residential status. And the party is reluctant to allow much change in the biggest cities, where the best jobs are concentrated. It fears the impact on social stability if large numbers of migrants become unemployed and do not want to leave.

In the countryside, unequal access to good education is a big impediment to progress. Rural schools pale in comparison to urban ones in terms of funding and staffing. Children with rural hukou have far less chance of completing high school. A big increase in the number of places at universities and colleges opened many more doors. But rural students are hugely under-represented at elite universities. Liu Baozhong of the Chinese Academy of Social Sciences reckons that at such institutions, nearly 40% of students are the children of managers and fewer than 10% are the offspring of farmers—even though more than 35% of Chinese live in the countryside.

China’s middle class has expanded rapidly, from almost non-existent in the 1990s to around 400m people today. But within this new class resentments stir, too. Competition for advancement is intense. Parents pour money into helping their children get ahead. In 2021 the government tried to level the playing field by banning most for-profit tutoring services. But this gave the richest an even bigger advantage: they could afford the sky-high prices that tutors began charging for their illicit work.

Many Chinese scholars suggest improving public services to reduce the risk that the poor remain poor, generation after generation, because of health-care costs, inadequate pensions, meagre unemployment benefits and the hidden price of good schooling. But the government is loth to splurge. “To promote common prosperity, we must not adopt the approach of welfarism,” Mr Xi warned in 2021. It supported “lazy people”, he said.

The party’s own elitism doesn’t help. For civil servants and white-collar workers in state firms—coveted types of work—membership is essential for advancement. The civil-service exam is highly regarded for its fairness, but who joins the party is at the whim of insiders. And within the state’s bastions, nepotism is rife.

In a report on its website in April, even state television concurred. It said public concern about “three generations in tobacco” and similar topics on social media was a sign that “there is still quite a bit of ‘inbreeding’ within state-owned enterprises and local-government agencies”. The scourge, it said, was “proliferating in hidden corners”. Netizens leapt on this rare admission. “These people are promoting traditional culture,” quipped one, referring to a pet project of Mr Xi. “Dragons give birth to dragons, phoenixes to phoenixes, and a rat’s son knows how to dig.” ■

Subscribers can sign up to Drum Tower, our new weekly newsletter, to understand what the world makes of China—and what China makes of the world.

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Xi JinpingChina.css-2x8c4j{margin:0.875rem 0;}.css-2x8c4j .e12sz0jx0+*{margin-top:0.875rem;}.el1rg701+.css-2x8c4j{margin-top:0;}.css-1aogxph{color:var(–mb-colour-greyscale-london-20);font-family:var(–mb-typeface-sans);font-size:var(–mb-typestyle-label-2-size);font-variant:var(–mb-typestyle-label-2-figures);line-height:var(–mb-typestyle-label-2-leading);}.css-1aogxph s,.css-1aogxph del{-webkit-text-decoration:line-through;text-decoration:line-through;text-decoration-thickness:0.0625rem;}.css-1aogxph b{font-weight:var(–mb-font-weight-semibold);}.css-1aogxph i{font-style:italic;}.css-1aogxph sup{font-feature-settings:’sups’ 1;}.css-1aogxph sub{font-feature-settings:’subs’ 1;}.css-1aogxph u{text-decoration-thickness:0.0625rem;}.css-1aogxph a{color:var(–mb-colour-greyscale-london-20);-webkit-text-decoration:underline;text-decoration:underline;text-decoration-thickness:0.0625rem;text-underline-offset:0.1875rem;}.css-1aogxph a:hover,.css-1aogxph a:focus,.css-1aogxph a:active{text-decoration-thickness:var(–mb-spacing-3xs);}.css-1aogxph a:hover{color:var(–mb-colour-base-chicago-30);}.css-1aogxph a:hover span{text-decoration-color:var(–mb-colour-base-chicago-30);}.css-1aogxph a:focus{background-color:var(–mb-colour-base-chicago-90);color:var(–mb-colour-greyscale-london-5);text-decoration-color:var(–mb-colour-greyscale-london-5);outline:none;}.css-1aogxph a:active{background-color:var(–mb-colour-base-chicago-90);color:var(–mb-colour-base-chicago-30);text-decoration-color:var(–mb-colour-base-chicago-30);}

This article appeared in the China section of the print edition under the headline “Never forget class struggle”

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China

September 28th 2024

• →A new class struggle is brewing in China
• →Another attack on a Japanese local points to a big problem in China
• →Xi Jinping wants to stifle thinking at a top Chinese think-tank

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From the September 28th 2024 edition

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Discover stories from this section and more in the list of contents

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They will go to great lengths to try

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Panama symbolises the Sino-American struggle for influence

The superpowers use soft and hard power

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Tensions with the West are fuelling China’s anxiety about food supplies

Grain pains are growing

Hail China’s new “ice-and-snow economy”

The country is betting on winter sports and tourism to boost growth in its rustbelt

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Источник: www.economist.com