China's new rich want political reform

TWENTY YEARS ago, Li Yan was a fresh-faced schoolgirl well-drilled in Maoist propaganda. "At school we were told two-thirds of the world's population was still suffering and miserable, and that we Chinese were working to stop their suffering." She laughs, incredulous at the memory.

Now 32, Ms Li works in the central city of Chongqing for a local branch of a Western multinational, having abandoned her poorly paid local-government job. Dressed in a Western business suit, she is a thoroughbred product of the reform era, fluent in English, and enthusiastic about China's October signing of the United Nations Covenant on Civil and Political Rights.

"It is really good that something is being done on human rights. I think this is really important, if the government can open up." She is, in short, the sort of mainland Chinese who would have been unimaginable two decades ago.

Today, China celebrates the 20th anniversary of the start of its reform process. On 18 December 1978, after two years of political manoeuvring, Deng Xiaoping convened a critical party conclave where he finally routed the diehard Maoists and set China on the road to the market.

The process has transformed the lives of China's vast population, now 1.3 billion.

Chinese Communist propaganda routinely describes the progress of the past two decades as "miraculous", but Deng's main achievement was to restore the possibility of normality in a country ravaged by the economic and human tragedy of the 1966-76 Cultural Revolution.

In a keynote speech marking the occasion today, President Jiang Zemin will dwell on the benefits of reform, many of which are undeniable. To quote just one statistic popular in the blizzard of propaganda running up to the anniversary: In 1980, fewer than 1 per cent of households owned televisions. By last year, there were 100.5 sets per 100 homes.

But away from their televisions, ordinary Chinese have less to celebrate. As China heads for the 21st century, its economy has slowed amid the Asian financial crisis, and long-postponed structural reforms have yet to be accomplished. State enterprises continue to drain the public account, with nearly half of them in the red; much of the state-run banking sector is insolvent; and none of these problems can be addressed without throwing yet more millions out of work.

Rampant corruption undermines the best attempts of the central government to tackle the debris of the command economy.

Most sensitive is the unresolved question of whether the next, much more difficult, economic reforms can take place without a parallel political opening. Liu Ji, a former vice- president of the Chinese Academy of Social Science, wrote in a mainland newspaper this week: "To transform China into a modernised country, we must take the next step, which is political reform ... China has made some progress in political reform, but so far its pace has somehow lagged behind that of the economic reform."

To dampen expectations of anyone reading this unusually bold view, he added that "the establishment of socialist democracy will take generations".

In the meantime, yesterdaybrought a sharp reminder of what still remains from the era when a population lived in fear of an unexpected knock on the door. Two high-profile dissidents went on trial for "inciting the subversion of state power", part of an aggressive crackdown on activists who have tried to register their China Democracy Party.

In the eastern city of Hangzhou, 200 people defied bans and gathered outside the courtroom to show support for 32-year-old Wang Youcai. One woman carried a banner with the Chinese characters reading "protest". In the city of Wuhan, two supporters were detained as Qin Yongmin, 49, went on trial.

In many ways, human rights in China have improved over the past 20 years, but only for those who do not question the Communist Party's monopoly of power. Personal freedoms - to choose a job, move around the country, or even divorce - are taken for granted. But life remains a complicated struggle for Mao's "masses", because of the yawning chasm between the upbeat official version of market reform and reality.

Take the peasants of Persimmon village, on the outskirts of Chongqing city, past the "California Garden Bowling Centre". Pang Lianghui, 41, recalled the late 1970s. "We were employed by the commune, and we earned work points according to how long we worked in the fields. Farm production was not enough, so we ate weeds. That was common, as were deaths due to malnutrition."

Deng's return of farming plots to individual families transformed Persimmon village's economy, and living standards soared.

Now, however, comes the challenge of market forces. The local township has requisitioned the peasants' land to build apartment blocks for Chongqing's overspill. The cadres have offered compensation and replacement housing. But many villagers worry whether the money will ever be paid, and have no idea how they will earn a living without land when the cash runs out. "After the property development, our living standards will fall back to 20 years ago," said one man.

In another world, on the pavements of Peking, is a different kind of loser. Wang Yongli, 38, described how he had been laid off 18 months ago in the north-east rustbelt city of Harbin from his job in an over-manned state grain-storage depot. "There are no jobs in Harbin," he said.

So earlier this year, Mr Wang said goodbye to his family and journeyed to the capital, where he joined the army of unemployed who illegally hawk goods on the pavements. He sells scarves for 10 yuan each (75p). In between police swoops, he needs to sell 10 a day to make a subsistence living.

There are already more than 10 million urban unemployed in China who are trying to eke out an existence in this way, and the number is going to rise steadily.

As China marks today's milestone, it can claim that everyone benefited from the first phase of economic reform, though to greatly differing degrees. The Communist Party's challenge for the next decade is how to manage a society in wrenching transition, where there will be a large number of losers who now want the freedom to complain.