Opinion

Equality, social safety net are the concern

By Eric Nilsson (China Daily)
Updated: 2009-09-24 06:52

There's plenty to celebrate as the People's Republic of China puts the flags out for the 60th anniversary of its founding. It's a time to rejoice while marveling at how far the country has come. And perhaps even more importantly, it's also a time to look ahead at what the next 60 years could bring - and the anniversaries that fall before and after.

Unless incredible circumstances derail China's full-speed-ahead advance, the world's fastest growing developing country will join the developed world's ranks in coming years.

But what kind of developed country China will become is to largely be determined by what it does now to lay the foundations for a relatively equal distribution of wealth and adequate social safety net - or, that could be, what it fails to do.

While China's history is full of twists and turns that have shaped and reshaped its society, perhaps the most monumental - at least the most venerated - turning point since liberation is the reform and opening up. It was during that time that then leader Deng Xiaoping declared: "Some people will get rich first."

The subsequent embrace of economic liberalization gave birth to a unique form of market socialism that hoisted a historically unprecedented number of people out of poverty.

Today, China has reached the point where some have gotten rich first, and its mixed economy has generated great wealth for much of its citizenry.

But the country is now approaching the critical juncture at which it decides whether or not - or at least how hard - it will strive to ensure today's poor catch up to the pioneers of wealth.

One of the world's oldest civilizations is a relatively young country. And in several respects, many Chinese seem eager to rediscover its ancient past while distancing themselves from much of its modern history.

So the question becomes how to scrap the "iron rice bowl" while providing a new ironclad guarantee that everyone has a bowl of rice.

Surely, nobody today can expect even history's most successful developing country to guarantee even the basics - that is, access to adequate food, clothing, potable water, housing, healthcare and education - for all of its massive population, because, well, it's developing.

But the course China maps now will determine if it will fail to do so once it develops.

I come from a country that is the richest in the world and that suffers from some of the greatest inequality of wealth distribution in the developed world. So the vastness of American wealth actually matters little to most Americans. Most of them know there's a lot of wealth out there, but they don't have much of it.

The country's $14.26 trillion GDP last year matters less to its citizenry than its Gini coefficient (the preeminent index measuring equality of wealth distribution, with lower scores indicating greater equity) score of 40.8, which is among the lowest in the developed world, according to the UN 2007-08 Human Development Report.

In 2008, China's GPD was $7.97 trillion, and it's Gini coefficient, 46.8, hovering around the midrange for developing countries.

In addition to uneven income distribution - the richest 1 percent of American households earns about 20 percent of the total income - the US has the developed world's smallest social safety net.

So, as China celebrates 60 glorious years, it should also look ahead with consideration for the equity of its future wealth distribution and social safety net, for these will determine the social stability, quality of life and overall gloriousness of the 60 years to come - and all years until and after then.

E-mail: erik_nilsson@chinadaily.com.cn