Global Economics

Pressure Builds for Chinese Farm Privatization


The situation is becoming untenable as corrupt officials snatch land for their own benefit and peasants are locked in poverty

In the carefully reconstructed official history of the Chinese Communist Party, there are few modern events more potent than the spontaneous land reforms carried out by a small group of peasant farmers in 1978, in the village of Xiaogang in eastern Anhui province.

It is regarded as a turning point from which the country set out on the road to reform and launched the Chinese economic miracle. But the event is rarely celebrated because it lauds what was effectively a rebellion against the party and the prevailing political system of the time.

While the party's own foundation is based on revolution, the spirit of rebellion is usually only celebrated when it is directed against enemies of the party.

In 1978, the hundreds of millions of peasant farmers in China were organized into communes to produce food for the state. This had been the system since the late 1950s, when all land in China was collectivized during a brutal five-year campaign. But the communal model was a disaster that contributed to the worst famine in human history—as up to 40 million people died in the aftermath of the Great Leap Forward—and by the late 1970s many peasant farmers still faced starvation.

Deng's new direction

The farmers who secretly divided up their communal land in Xiaogang were risking their lives, as such revisionism was seen as a capital crime. Luckily for them the reform-minded Deng Xiaoping championed their cause, creating the "household responsibility" system under which peasant farmers could farm their land individually on the basis of 30-year leases from the government.

The new system triggered an explosion in wealth and eventually led to much wider reforms that have propelled the spectacular economic growth of the last few decades.

Beijing has said that the original 30-year leases will be renewed as they expire, but for many peasant farmers the system—under which the state owns all land and local party officials often act as feudal landlords—has outlived its usefulness.

In recent months peasants in at least four far-flung locations have posted statements on the internet claiming to have seized a total of more than 110,000 hectares of farmland from the state, privatized it and divided it among themselves.

Most protests in China are not organized at a national level and pose no direct challenge to the party itself, so this one came as a shock. The government responded with the usual swift and brutal crackdown, as most of the farmers who had signed their names on public documents were arrested or detained.

The secretive organizers behind the protests told reporters the similarities between their action and that of the Xiaogang peasants were intentional: They hoped to provoke a similar outcome by winning top-level backing for the privatization of rural land in China. They point out that land in urban areas has effectively been privatized already, and that the current system exacerbates the widening wealth gap between urban and rural citizens by denying peasants the right to use their land for collateral or sell it on the open market.

Rural insurance policy

Government scholars counter that unlike other large developing countries such as Brazil and India, the current system ensures that China has almost no landless rural poor and no large slums. This is because migrant workers who lose their jobs or fail to make it in the cities can return to the land they lease in their home villages.

Scholars say that if Beijing were to privatize all rural land China would soon be faced with a flood of landless poor that would spawn the same Maoist uprisings that currently plague India.

Nobody wants that to happen, but today's situation is becoming increasingly untenable as corrupt officials snatch vast tracts of land for their own benefit and peasants find themselves locked in a cycle of poverty with none of the rights and power that comes with owning their own assets.

Today Xiaogang is the very definition of a Potemkin Village, with an expensive museum and polished façades that hide the half-built homes of the old peasants who rebelled against the government and won 30 years ago. Perhaps one day the party will erect a new monument to the peasants who defied it in 2008 and brought about the privatization of all land in China.


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