Neoliberalism, Authoritarian Politics and Social Policy in China by demandside

Debate

Neoliberalism,AuthoritarianPoliticsandSocialPolicy inChina

JaneDuckett

ABSTRACT

Thisarticleexplorestherelationshipsamongneoliberalism,socialpolicy expansionandauthoritarianpoliticsincontemporaryChina.Itarguesthatin theeraofneoliberalism,risingnewrightandauthoritariangovernments,the ChineseCommunistPartyhassoughttoretainpowerbyshiftingpolitically totherightandpromotingneoliberal-lookingeconomicpolicies.Thesepolicieshaveraisedaveragelivingstandardsbutalsoincreasedinsecurityfor mostoftheChinesepopulation,whilenewsocialpolicieshavefacilitated marketization.Socialpolicyexpansionincludesminimalcashtransfersas wellassocialold-ageandhealthinsuranceforhithertoexcludedsections ofthepopulation.Thesepolicieshavebeguntoerodelong-standingurban–ruralsegregation,buttheyhaveaddednew,underfunded,socialprogrammes ratherthanwideningparticipationinexistingones,re-segregatingprovision sothaturbanelitesandformalsectorworkersenjoymuchmoregenerous provisionsthanmanypeopleworkinginformallyandthosewithoutwork. Thesesocialpolicies’mostsigniﬁcantdarksidesthusincludecompounded incomeinequalitiesandthesegmentationandstigmatizationofthepoorest. AuthoritariancontrolshaveenabledtheCommunistPartytoavoidredistributivepoliciesthatwouldundermineitsurbansupport,sothatpoliticsinChina differfromtheright-wingpopulismofnew,anti-establishmentauthoritarian regimes.

INTRODUCTION

OthercontributionstothisDebatesectionexplorerelationshipsamongneoliberalism,socialpolicies,newrightandauthoritarianpolitics.Theytakeas theirstartingpointargumentsthatexpansionsofsocialprovisioninginthe periodsincetheglobalspreadofneoliberalisminthe1980smaysometimes

IwouldliketothankAndrewFischerandtheanonymousreviewersfortheirhelpfulcomments onthisarticle.TheresearchthatunderpinsthisarticlewasfundedbytheEconomicandSocial ResearchCouncilunderprojectsES/J012629/1andES/J012688/1/.

DevelopmentandChange 51(2):523–539.DOI:10.1111/dech.12568

C 2020TheAuthors. DevelopmentandChange publishedbyJohnWiley&SonsLtdonbehalf ofInternationalInstituteofSocialStudies.

ThisisanopenaccessarticleunderthetermsoftheCreativeCommonsAttributionLicense, whichpermitsuse,distributionandreproductioninanymedium,providedtheoriginalworkis properlycited.

facilitateneoliberalprojects(Lavinas,2013,2017;Saad-Filho,2015),and thattheyincreaseinsecurity,reinforce,reproduceandstructureinequalities,andfacilitatesocialcontrol,orderingandsegregation(Fischer,2018; Posner,2012).Theyaskhownew,right-wingpopulismandauthoritarianismplayintotherelationshipsbetweenneoliberalismandsocialpolicies globally.

ThisarticleexplorestheseissuesinthePeople’sRepublicofChina where,undercontinuedauthoritarianone-partypolitics,theChineseCommunistParty(CCP)hassincethelate1980sorchestratedneoliberal-looking, market-orientedeconomicreformsandexpandedsocialpolicyprovisions. Chinaisanimportantcasebecauseitistheworld’slargestauthoritarianstateandtheworld’ssecondlargesteconomy.Itseconomicreforms ledtosustainedhighlevelsofgrowth—anaverageof8.5percentper yearbetween1980and2018—duringwhichtimeChinahasshifted quicklyfromalow-incometoanupper-middleincomecountry,asdeﬁned bytheWorldBank.Theproportionofthepopulationlivinginextreme poverty(onlessthanUS$1.90perday,2011dollarsatPPP)fellfrom 66percentin1990to0.7percentin2015,whiletheproportionbelow theWorldBank’supper-middleincomecountrypovertylineoflessthan US$5.50perdayfellfrom98percentto27percent.1 Chinaisthereforesometimesportrayedasamodelforotherauthoritarianordeveloping countries.2

Butcantheterm‘neoliberalism’beusedintheChinesecontext?Neoliberalismisusuallyassociatedwithfreemarketcapitalism—increasingtherole ofmarkets(reducingcapitalcontrols,deregulatingcreditandlabourmarkets),privatizingpublicenterprises,signingfreetradeagreements,lowering taxesandreducinggovernmentspending—aspromotedinthe1980sand 1990sbytheWorldBankandInternationalMonetaryFund(IMF)(Evans andSewell,2013;Ostryetal.,2016).3 China’seconomicreformsfrom around1980,whenitjoinedtheWorldBankandIMF,didencompassmany suchmeasures.AsChinamovedawayfromaSoviet-stylestate-planned economy,itintroducedmarketsforgoodsandservicesaswellaslabourand housing,pursuedstateenterprisereform,privatizedmanypublicenterprises andencouragedprivatebusinesses,reducedcapitalcontrols,andsigned morethanadozenfreetradeagreements.In2001,itjoinedtheWorldTrade Organization(WTO).Sincetaxationwasintroducedinthe1980s,individualincometaxeshavebeenlow,whilecorporatetaxesandenterprisesocial insurancecontributionshavebeenreducedinrecentyears.Although,inthe early21stcentury,thisrightwardshiftinpolicyprovokedcriticismfrom

1.WorldBankdata,availableathttps://data.worldbank.org/ 2.Foradiscussion,seeBreslin(2011).

3.EvansandSewelldistinguisheconomicpoliciesfrombothneoliberalideologyandneoliberaleconomictheory,which,theysay,‘stressesthewelfaremaximizingconsequencesof marketexchange’(2013:36).

China’s‘NewLeft’—largelyduetorisingincomeinequalities—which temperedofﬁcialpro-marketrhetoric,inpracticetheParty-state4 hascontinuedtoseemarketsandtheprivatesectorasimportantdriversofeconomic growth.

Yet,despiteitsdramatic,marketizingtransformations,Chinaisstillfar frombeingafreemarketeconomy.TheChineseParty-stateowns(holdsa majorityofthesharesin)largeenterprisesinkeysectors,andstatebanks stilldominateandcontrolmuchenterpriseﬁnance.Privatebusinesses,meanwhile,havehadanuneasyridesincetheyemergedinthe1980s,struggling toshakeoffthe‘capitalist’stigmaoftheMaoist,state-planningperiodand winbankloans.Intheearly21stcentury,theNewLeftpushbackhalted privatizationinsomesectors,andledtogreatersupportforstateenterprises (aprocessreferredtoas guojinmintui —thestateadvancesandtheprivate retreats).Mostrecently,underXiJinping,theCCPhasbeenstrengthening itscontrolinprivateaswellaspubliccompanies.Internationally,thePartystatealsostillregulatestrade,aswellasinwardandoutwardinvestment. Forthisreason,althoughneoliberalismevenintheUnitedStates(usually seenasaleadingneoliberalexample)hasreliedmoreonstatepowerand interventionthanisusuallyunderstood(Kiely,2018),theChinesePartystate’ssigniﬁcantroleinanascentmarketeconomymeansthatsomewould questionChina’sneoliberalcredentialswhileothersseeitasexhibitingan unusualvariantofneoliberalism(seeWeber,2018).DavidHarvey(2005: 120),forexample,arguesthat‘neoliberalismwithChinesecharacteristics’ bestdescribesChina’s‘particularkindofmarketeconomythatincreasingly incorporatesneoliberalelementsinterdigitatedwithauthoritariancentralized control’.

MostargumentsinsupportofthenotionthatChinaisneoliberalgobeyond policiestodwellontheideas,ideologyor‘socialimaginary’ofneoliberalism (Breslin,2006;EvansandSewell,2013).Anthropologistsinparticularhave portrayedChinaasinfluencedbyneoliberalideasandideology(Anagnost, 2004;GreenhalghandWinckler,2005;Kipnis,2007;Rofel,2007;Wang, 2004;Yan,2003;ZhangandBray,2016).Theyhavebeenchallengedby otherswhoarguethatwhileacceptanceofneoliberalideasisevident,particularlyamongurbanelites,theirdominancehasbeenoverstatedgiven thecontinuedinfluenceofBuddhism,Daoismandothertraditions(Horesh andLim,2017;Nonini,2008).Yetmostwouldagreethatneoliberalideas findsupportamongChina’surbanelite,wherethebenefitsof‘marketefficiency’arevirtuallyunquestioned(Nonini,2008).AlthoughmostChinesewouldsaythattheyshareacollectivistideology(andnationalismand familyvaluesremainstrong),thereisnowinfactastrongindividualist streakinurbansociety,andonethatequatessuccesswithconspicuousconsumptionandtheusualstatussymbols—designerbrands,largevillasand

4.Iuse‘Party-state’inthisarticle,ratherthan‘state’or‘government’becausetheChinese CommunistPartypenetratesandcontrolsgovernmentandotherstateinstitutions.

expensivecars.Entrepreneurshipisvalued,andsuccessfulentrepreneurs (suchasJackMa,formerchairmanofAlibaba)arenationalcelebritiesand mediapersonalities.Thephrase‘togetrichisglorious’,whichhasbeen widelyattributedtoChina’sformertopleader,DengXiaoping,thearchitect ofitsmarketreformsinthe1980sand1990s,stillresonatestodayinasociety thatcelebratespersonalwealth.

ThisarticlearguesthatsocialpoliciesfacilitatedChina’sparticularbrand ofneoliberal-lookingmarketreformandcontributedtoincreasinginsecuritiesformanypeople.Aseconomicpoliciesinthe1980sand1990s introducedlabourmarketsanddramaticallyincreasedthenumbers(and proportion)ofthepopulationintheinformalsector,planned-economysystemsofsocialprotectionandprovisioncollapsedorwereeroded(Duckett, 2011).TheChineseParty-statethenusedsocialpoliciestoreducedissatisfactionwiththedownsidesofmarketization:thewaveofhighunemploymentfromstateenterprisesinthelate1990sandearly2000s,rapidlyrising incomeinequalities,andthenthenegativeimpactonfarmingfromWTO entry.

Thesenewsocialpoliciesunderminedplanned-economysystemsofsocialsegregationbuttheycreatednewones.Planning-eraruralcommunes wereabolished,andurbanworkunits—thathadprovidedjobsecurity and‘cradletograve’socialbenefits—weregraduallydismantled.The householdregistration(hukou)systemthathadstrictlysegregatedrural andurbandwellersanddefinedtheirsocialprovisioning,waseroded.This urban–ruraldividewasthenfurtherweakenedbyextendingsocialpoliciestomigrantworkersintheformalsectorand,forthefirsttime,creatingentitlementstohealthinsuranceandpensionsforruraldwellers.But anew,means-testedsocialassistanceprogramme,the‘MinimumLivelihoodGuarantee’(MLG),wasimplementedhighlyselectivelyandintrusively,andmostlyonlyforthe‘deserving’poor—thosewithdisabilities orunabletowork.Ithasthussegregatedthepoorestintoastigmatized underclass.

Newsocialinsuranceprogrammesalsosegregatedthepopulationinnovel waysaswellascompoundingrisingincomeinequalities.Theyextended publicprovisionofeducation,socialold-age,healthandunemploymentinsurance,butprovidedmoregenerouslyforpublicservantsandthosewith formallabourcontractsthanforinformalworkersandthosewithoutwork inbothcitiesandcountryside.Atthesametime,education,healthand housingwerecommercialized,whichpusheduppricesandcontributedto labourmarketinsecurities.Thus,althoughrapidlyrisingstaterevenuesand percapitaGDPallowedthegovernmenttoincreasespendingonsocial policies,itdisproportionatelybeneﬁtedthebetter-off.5 Asaresultofthis

5.China’sGDPpercapitarosefromUS$195in1980toUS$9,770in2018incurrentUS dollars(ﬁguresfromtheWorldBank:https://data.worldbank.org).WhiletheWorldBank doesnotprovidedataforsocialspendinginChina,itreportsthatgovernmentspendingon

combinationofmarketizingeconomicreformandregressivesocialpolicy,Chinamovedrapidlyfrombeingoneofthemostequaltooneofthe mostunequalsocietiesintheworldinthe20yearsbetween1990and 2010.6

Theextenttowhichsocialpolicieshavefacilitatedsocialcontrols,beyondsegregatingthepoorestwithtargetedsocialassistanceandsegmenting provisionattheformal/informalsectordivide,ismoot.Socialinsurance programmesincreasinglyusenewtechnologiestogatherandsharepersonalinformationinwaysthatmightinvadeprivacyandfacilitatesocial control.ButtheCCPalreadyhasatitsdisposalmanycoercivetoolsthat arenotavailableindemocraticpoliticalcontexts:mediacontrols,surveillancetechnologiesandpolicepowerstoprevent(forexample,class-based orfeminist)societalchallengestoitspolicies.Indeed,theChinesePartystatehasbeenabletoimplementneoliberal-lookingeconomicpoliciesand regressivesocialpoliciesinpartbecauseofitsauthoritarianpoliticalinstitutionsandalreadyextensivemechanismsofsocialcontrol.Ithasdirected mediareportingofsocialproblemsandpolicysolutions—emphasizing theuniversalityofpolicies,forexample,whiledownplayingtheinequalitiesinprovisionandunevenimplementation.Thus,theCCPhasbeen abletoarticulateaMarxist,socialistideologywhileespousingright-wing, neoliberal-lookingeconomicpoliciesaswellasﬁscallyconservativesocial policiesthatdisproportionatelybeneﬁt—andco-opt—better-offurban dwellersthatareanimportantpartofits90millionmembershipandits supportbase.

Therestofthisessayprovidesevidencetosupportthisargument.The nextsectionoutlinesthemaintransformationstosocialprovisioningthat haveresultedfromthesocialpolicyreformsofthelast30yearsinChina. Itfocusesontheachievementsofthesepolicies,thepositivetransformationsintermsofuniversalentitlements,andtheinﬂuencesthathave shapedthem.Thefollowingsectionthenexploresthedarksideofthese policies:howtheyincreaseinsecuritiesforsome,compoundrisinginequalities,andfacilitatesocialsegmentationandcontrol.Theconcluding sectiondiscussesthepoliticsbehindChina’ssocialpolicies,theirrelationshipswithneoliberal,right-wingandauthoritarianpoliticselsewhere,and whatthismeansforChinaasamodelforauthoritariananddeveloping countries. healthrosebetween2000and2016,whenitwasatasimilarleveltoRussiaandslightly aboveIndiaandVietnam.

6.AccordingtoWorldBankestimates,China’sGinicoefficientrosefrom0.32in1990to 0.43in2010(https://data.worldbank.org).TheWorldBank’sestimatesarelowerthanmost others,includingtheChinesegovernment’sown,whichindicatethattheGinicoefficient peakedat0.49around2008beforefallingslightlyinthelastdecade(see,forexample,Liand Sicular,2014).Gaoetal.(2019),basedonsurveydata,seeincomeinequalitiescontinuing torisesignificantlybetween2007and2013.

CHINA’SSOCIALPOLICYREFORMS:THESEGMENTEDEXTENSIONOF PROVISIONINTHE21STCENTURY

TheHistoricalContextofSocialPolicyunderStatePlanning(1949–early1980s)

TheChineseParty-statewasinfluencedbytheSovietUnion’smodelofeconomicplanning,politicalorganizationandsocialpoliciesafter1949,when theChineseCommunistPartyestablishedthePeople’sRepublicofChina. ButChinainthe1950sand1960swasverydifferentfromtheSovietUnion, withamuchbiggerpopulationandamuchlargerproportionworkingin agriculture.Insocialpolicyterms,therefore,theSovietmodelwasmoreinfluentialinthecities—hometoonly12percentoftheChinesepopulation in1949—thaninthecountryside.7 Thenewregimeintroducedhousehold registrationthattiedpeopletotheirplaceofbirthandlimitedgeographical mobility,creatingastricturban–ruralsegregation.Urbandwellersbenefited fromtheso-called‘IronRiceBowl’:jobsecurityandworkplace-providedsocialprovisionsrangingfromhousingandpensionstohealthcareandnursery orschoolprovision.Althoughrecordsarepoor,weknowthatthisprovision wasfarfromequallyallocated—beingmuchmoregenerousforthosein largestateenterprisesthanthoseinlocalgovernment-runcollectives—but theresultwasahighlevelofequalityinincometerms.Althoughmenwere morelikelytobeemployedinstateenterprises,andwomenincollectives, familiesmoreoftenlivedinthehusband’sallocatedhousing,andenterprise employeehealthcarealsoincludedhalfofdependants’costs(Dillon,2015; Dixon,1981).

OnceruralcommunesweresetupacrossChinafromthelate1950s(until theyweredismantledintheearly1980s),followingthecollectivizationof land,ruraldwellerswerealsogivensomemuchmorelimitedsocialprotection.Thisusuallyconsistedofsupportforthoseunabletowork,primary schooleducation,andsomebasichealthcare,oftendeliveredby‘barefoot doctors’andfundedthroughpatchilyorganizedandmeagrelyfunded‘rural cooperativemedicalschemes’.Butruraldwellersbuilttheirownhousing and,withoutpensions,weredependentonfamiliesintheiroldage(Dillon, 2015;Dixon,1981).

Market-orientedEconomicReformsandErodingSocialProvisions(1980sand 1990s)

China’smarket-orientedeconomicreformsareconventionallydatedtolate 1978,whenDengXiaopingassumedpower.UnderDeng,Chinamoved quicklyfromcommunetohouseholdfarming,andwhenthisstimulatedrural growth,itinitiatedindustrialreforms.Stateenterpriseswerepermittedtolay

7.DatafromtheNationalBureauofStatisticsofChina,availableat:www.data.stats.gov.cn

offworkers,erodingjobsecurityandgraduallyintroducinglabourmarkets. Thespreadofcommoditymarketscreatedrapidgrowthintheearly1990s, generatingsupportforpro-marketpoliciesandvirtuallyeradicatingearlier oppositiontoreform.Stateenterprisereformsinthelate1990sthenledto large-scalelay-offsandtheendoftheIronRiceBowl.Informalsectoremploymentrosedramatically(DuckettandHussain,2008);itisnowestimated thatoverhalfofurbanworkersfallintothiscategory(Jiangetal.,2018).8 Althoughthestatecontinuedtoplayaroleindirectingeconomicinvestment, itshiftedfromissuingdetailedplanstodeployingmacroeconomicleversin aprocessthathasbeendescribedas‘growingoutoftheplan’(Naughton, 1995).Itwasatthisstagethatpoliciesbecamemoreneoliberal-lookingas Chinesepolicymakersbecamesoenamouredofmarketsthattheywereadvocatedeveninthehealthsector,whereprivatehospitalswereencouraged, andin2001entrepreneurswerepermittedtojointheCCP(Holbig,2013).

TheParty-statealsoadoptedpro-marketpoliciesinareasofsocialprovisioning,withsocialpolicyreformsinthe1980sand1990spartiallycommercializinghealthcare,educationandurbanhousing.Ruralcooperativemedicalschemeswereallowedtocollapseintheearly1980suntiltheyoperated inonlyaround5percentofvillages(Duckett,2011)and‘barefootdoctors’ begantooperateasprivateproviders(andwerenowcalled‘villagedoctors’) chargingfeesforservicesinmanyareas.Hospitalsreliedincreasinglyonpatients’out-of-pocketpaymentsasworkplacesstruggledtoprovidefortheir employees’healthcare.Governmentspendingasashareofhospitalbudgets plummeted.Ineducation,althoughthegovernmentdidintroducealawon freenine-yearcompulsoryeducationin1986,itwasnotstrictlyenforced,and manystateschoolsbeganchargingfees(Tangetal.,2019).Subsequently, privateschoolswereallowedtooperate,anduniversitiesintroducedtuition fees.Similarly,therapidcommoditizationofurbanhousinginthe1990s meantthat,particularlyinlargecities,housingbecameunaffordablefor manyaspricesrosesteeply(LeeandZhu,2006;Zhu,2018).

Theneoliberal-lookingeconomicpoliciesofthe1990swereaccompanied bysocialpoliciesaimedatfacilitatingstateenterprisereformsandproviding minimalassistancetothemillionsofworkerswholosttheirjobsasaresult. Unemploymentinsurancehadbeenintroducedforstatesectorworkersinthe late1980saslabourmarketsbegantobeintroduced.Inthelate1990s,asthe lay-offssurged,thisschemewassupplementedwithamyriadofmeasures aimedatprovidingsomekindofsupport.Theseincludedthecreationof ‘re-employmentservicecentres’thatprovidedsomeincomesupportortried toprovidetrainingoremploymentservices(DuckettandHussain,2008).

8.UsingtheILOdefinitionoftheinformalsector,Jiangetal.(2018)arguethatthoseemployed intheinformalsector(smallprivatefirmsorself-employed)probablyaccountforaround 50–60percentofthetotal(withsignificantvariationacrosscities),andthatthoseemployed informallyintheformalsector(inotherwordswithoutalabourcontract)havebeenfound toaccountforaround11–13percentofthetotal.

In1999,thenewminimumlivelihoodguarantee(MLG)programmewas alsointroducedinthecities.MLG,acashtransfersupplementaimedat bringinghouseholdincomesuptoaminimumlevel(determinedlocally), wassupposedtoensureaverybasiclevelofhouseholdincome.Introduced toreduceprotestsbyworkerslaidoffduringstateenterprisereforms,itwas subsidizedbycentralgovernmentattheturnofthe21stcentury,andspending peakedatthattime.Buteligibilitycriteriaweresubsequentlytightenedand, asnotedintheintroduction,inpracticeMLGwasgivenonlytopeopleon lowincomesdeemedunabletowork,suchasthesick,disabledorelderly (Hammond,2019;Solinger,1999).Thegovernmentalsoadoptedpolicies toprovidesocialorlow-costhousingforpeopleonlowincomes,butthey werepoorlyimplemented(Zhu,2018).

Urbanemployeesocialinsuranceprogrammeswerealsointroducedat thistimeforoldageandhealthasawayofreducingtheburdenofprovisiononolderstateenterprisesandenablingthemtocompeteonalevel playingﬁeldwithnewerstateorprivatesectorbusinesses.Whilegenerous non-contributoryschemeswereretainedforthoseworkingingovernment, enterpriseschemesinvolvedemployeesandemployerscontributingtolocal government-administeredfundsfromwhichpensionsandhealthcarecosts wouldbepaid.Theyweregenerousforthosewhoparticipated,butlocalgovernmentsadministeredthefundsandfocusedparticularlyoncompliance amongstateandforeign-investedenterprisesorlargerprivatebusinesses, withtheresultthattherisingnumberofinformalsectorworkersandruralto-urbanmigrantsdidnotusuallyparticipate(Jiangetal.,2018).Thus,the proportionofthepopulationparticipating,forexample,inurbanemployee healthinsurancebytheturnofthe21stcenturywasmuchlowerthantheproportionthathadbeenincludedinthepre-reformworkplacesystem.Despite reform,therefore,theseprogrammeswereinfacthighlyregressivebecause theyweremostlikelytobeprovidedtoprofessionals,middlemanagement andworkerswithformallabourcontracts—thosealreadyonhigherincomes (Duckett,2004).

21stCenturySocialPolicyReform:ExpandingbothUrbanandRuralBasic Provision

Theresultofthiscombinationofeconomicandsocialpolicieswasarise inaveragelivingstandardsbutatthesametimearapidriseinincome inequalitiesandinsecurity,particularlyinruralareasandamongthosein thecitiesunabletoﬁndwork.Intheearly21stcentury,afterChinajoined theWTO(in2001)andtheeconomy—andstaterevenues—continuedto grow,theChineseParty-stateinitiatedaseriesofsocialpolicyreformsaimed atdeliveringsomebasicsocialprovisionsforruraldwellersandurbanites withoutworkandincreasedgovernmentsocialspending.From2007to2018, theshareoftotalgovernmentspendingoneducationrosefrom14.4percent

to14.6percent,onsocialsecurityandemploymentsupportfrom10.9per centto12.2percent,andonhealthfrom4percentto7.1percent.9

Undertheinﬂuenceofinternationalorganizations,theParty-stateseems tohavepromotedthesesocialpolicyreformsbecauseitwaspersuaded thattheywouldbothhelpdeveloptheeconomyandpreventdissatisfactionandprotest(Duckett,2019).Measuresincludedabolishingunpopular agriculturaltaxes(Wang,2019),extending‘newruralcooperativemedical schemes’(involvingbothhouseholdandgovernmentcontributions)nationwide,andintroducing‘newruralsocialpensions’.TheParty-stateextended MLGtoruralareasin2002andfrom2007setupanewurbanresidents’ healthinsuranceforthosepeopleineligibleforgovernmentorurbanemployeehealthinsurance.Inrecognitionofthegradualerosionoffreeschool education,theParty-statein2006alsomadeacommitmenttoproviding nineyearsoffreeeducationforallinwhatissometimescalledthe‘Free CompulsoryEducationReform’ofthatyear(Tangetal.,2019).Recent policieshavebeguntomergetheurbanresidents’andruralcooperative medicalschemesinmanylocalities,aswellassometimesmakingsomeprovisionsportable.Theurban–ruraldivideinsocialpolicyisgraduallybeing eroded.

THEDARKSIDES:AUTHORITARIANISM,NEOLIBERALISMANDTHE LIMITSTOSOCIALPOLICYREFORM

China’ssocialpolicyreformsestablishedentitlementsinprincipletooldageandhealthinsuranceforallChina’sruraldwellers,andtheyextended theParty-state’scommitmenttofunding‘basic’provisionforthewhole population.Thesepolicieshavebeenportrayedasuniversalizingandequalizing(jundenghua),butwith‘basic’asyetundeﬁned,theygiveanimpressionofuniversality,whileallowinghigherlevelsofcareandprovision forbetter-offurbandwellersinformalwork.Byretaining(andonlyin 2015reforming)generousprovisionforgovernmentofﬁcials,thenintroducingseparateschemesinvolvingemployerandemployeecontributions, andsubsequentlyaddingfurther,meagre,government-fundedschemesfor those‘residents’withoutwork,thesepoliticallyexpedientpoliciescreatedasegmentedsystemresultinginveryunequalprovision.Governmentspendingremainsrelativelylowforanupper-middleincomecountry andskewedtowardsprovidingforpublicservantsandurbanformalsector workers.

Inrelationtopensions,forexample,thereareseveraldistinctpensionsprogrammes(ZhuandWalker,2018):long-standinggovernmentpensions(paidtoofﬁcials);urbanemployeeold-ageinsurance(forthosein

9.CalculatedbytheauthorusingdatafromtheChineseNationalBureauofStatistics,available at:www.data.stats.gov.cn

non-governmentformalsectorwork);newruralandurbanresidents’social pensions(formerlyseparateschemesbutmergedin2014);aswellassome residualprovisionofaformerruralpensionschemefrom1992;ascheme forruraldwellersascompensationfortheirlandbeingboughtbylocalgovernments;andaveryminimal‘AdvancedAgeAllowance’forpeopleover theageof80years.ZhuandWalker(2018:1417)reportthattheseschemes varyenormouslyintermsoftheirprovisions,withthegovernmentscheme providinganaverage2,500yuanpermonth,theemployees’scheme1,800 yuan,andtheresidents’schemeslessthanatenthofthat,at127yuanper month—sothattheGinicoefﬁcientforpensionswas0.68.Theinequalitieswithinschemesarealsosigniﬁcant,especiallywithintheresidents’ scheme.

Abroadlysimilarsituationexistsforhealthinsurance,wheregovernment ofﬁcialsandformalsectoremployeesreceivemoregenerousprovisionsthan otherurbanandruralresidents.Forthelatter,co-paymentsarehigher,meaningmoredirect,out-of-pocketpayments.Liuetal.(2016)calculatedthatas aresult,between1993and2006,40percentofgovernmenthealthspending wentto3percentofthepopulation,andthatwhilethepercentagehadfallen recently(followingtheintroductionofthenewruralcooperativemedical schemes),in2012itwasstill25percentofspending.Brixietal.(2013) foundthataveragepercapitagovernmenthealthspendingongovernment employeeswas2,629yuan,comparedto78yuanforruralresidentsand40 yuanforurbanresidents.Medicalcarecosts,particularlyforseriousand chronicillnessescanpushmanyintopoverty.Sietal.(2019)found,for example,thatin2013inurbanareasinShanxiprovince,47percentof familiesaffectedbyhypertensionandotherillnessessuffered‘catastrophic healthexpenses’,withpoorfamiliesbeingmorevulnerable.Thiswasan increaseonthe22percentoffamiliesfoundtohavesufferedinthesame wayin2008.

Unevenprovisioninsocialpoliciesalsohidesthefactthateveninurban areas,labourmarketinsecurityhasbeenaccompaniedbysocialinsurance policiesthatprovidemostgenerouslyforthebetteroffandmostsecure. Becausesocialinsuranceschemeslinkbenefitstocontributions,thosewith higherincomesreceivemoregenerousbenefits(ZhuandWalker,2018). Meanwhile,accordingtoasurveyconductedin2012,while95percentof formalsectorworkershadhealthinsuranceand90percentwereenrolled inapensionsprogramme,theequivalentfiguresforinformalsectorworkers werejust58percentand47percent(Jiangetal.,2018:346).Thisiswhy, eventhoughrecentpolicieshaveencouragedtheinclusionofregisteredrural migrantsinurbaninsuranceschemes,theyarelesslikelytobeenrolled— becausetheyarelesslikelythanurbanregisteredresidentstohaveformal employment(ibid.:348).

Similarly,althoughlabourmarketsbroughtinsecurity,unemploymentinsuranceprovidedforonlyasmallshareoftheworkingpopulation,and oftenthebetteroffandmostsecureamongthepopulation.Unemployment

insurance,likeold-ageandhealthinsurance,iscontributory,isavailable onlytourbanwagedworkers,andismorelikelyamongthoseinformal work(DuckettandHussain,2008).Gaoetal.(2019)foundittohavea negligibleeffectonintra-urbanincomeinequalities.

Educationreformsinthe21stcenturyhaveseenanexpansioninprovision andanincreaseineducationqualityinmanyareas,buttheeducationsystem hasbecomemoreunequalasaresult,withregionalaswellasclassdifferencesinaccesstoqualityeducation(Schulte,2018).Althoughthe2006 educationreformsoughttoexemptruralschoolchildrenfromtuitionand othermiscellaneousschoolfees(followingeffortstolimitfeesinruralareas in2001–04),itdidnottackletheproblemofunequalqualityineducation provisionduetodifferentiallocalgovernmentinvestment,ortheproblems thattheurbanpoorfaceinsendingtheirchildrentoschool,forinstance becausetheycannotaffordalltheadditionalcosts(stationery,books,andso on).

Policiestoimprovethesupplyofaffordableandadequatehousinghave alsoproveddifﬁculttoimplement.Recenteffortshaveincludedsharedhomeownershipschemes,build-to-rentschemesandshanty-townupgrading. AsZhuYapenghasnoted,theprovisionofpublicsocialhousinginChina —followingageneraltrendawayfromsocialrentalhousingacrossmany countriesoftheOrganizationforEconomicCooperationandDevelopment —isnotapriority,and‘[t]heuseofsubsidiesinsteadofdirectprovisioning showsthattheChinesegovernmentprefersmarket-basedsolutions[tothe supplyofhousing]...asitalsohelpstostimulatetheeconomy’(Zhu, 2018:48).Theconsequencesofaristhat(asof2015)asmanyas60per centofChinesehouseholdsinChina’slargestcities(citieswithapopulation ofover7million)couldnotaffordtobuyorrenthousingwithoutasubsidy (Woetzel,2015).Asaresult,many—especiallymigrantsfromruralareas —liveinshantytownsontheoutskirtsofcitiesandlackbasicfacilitiessuch asrunningwater,electricityandheating.

AdifferentsetofdownsidesisproducedbyChina’smeans-testedMLG programmesintroducedinthe1990sinthecitiesandinthefirstdecadeof the21stcenturyinthecountryside.Theseprogrammesprovidecashsupport tohouseholdsfallingbelowalocallydeterminedminimumlevelthatis calculatedusingthepriceofabasketofessentialitems.Cashtransfers bringhouseholdsuptothelocallevelandareagreedtobemeagre— barelysufficienttoprovidefoodandsomebasicclothing.DorothySolinger (2017)hascalculatedthatinthecitiesbetween2006and2015theybrought incomestoaround16–17percentofaveragedisposableincome(downfrom 21percentin2003).Eventhen,theschemeisinpracticeimplemented muchmorestringentlythanpolicydocumentssuggest,sothatfewerthan halfofthosewithincomesbelowthelocalMLGlinewerereceivingthe benefit(ibid.:51).Theschemeisalsohighlystigmatizingsinceitistargeted atonlytheverypoorestandinvolvestheMLGapplicants’circumstances beingpubliclydisplayedintheneighbourhood(Hammond,2019;Solinger,

1999).TheMLGschemesexpandedintermsofcoveragebetween1999 and2011—risingfrom2.8millionparticipantsto76millioninthatperiod —butthenumberofparticipantsfellsteadilythereafterto45.3millionin 2018.10 Totalspendingonthisprogramme,whichhadrisenfrom0.1per centofgovernmentexpendituresin1999to1.2percentin2013,fellin2014 (Solinger,2017).SpendingasashareofGDProsefrom0.02percentin 1999toahighof0.14percentin2009,fallingto0.11percentin2014— lowincomparisonwithLatinAmerica,MexicoandIndonesiaataroundthe sameperiod,asSolinger(ibid.:50–51)pointsout.

Giventheverydifferentlevelsofprovisionacrossdifferentschemesand localities,itisunsurprisingthattheir21stcenturyroll-outhasdonelittle toreduceinequalities.Gaoetal.(2019),analysinghouseholdandindividualincomedatafrom2002,2007and2013,foundsocialbenefits(defined toincludepensions,healthinsurance,unemploymentinsurance,MLGand housing,aswellasin-kindbenefits)contributedamuchhigherproportionof urbanthanruralhouseholdincomes(18percentversus6percent,in2013). Within(butnotbetween)urbanandruralareas,pensionsdidhelpreduce inequalitiessomewhat,butotherbenefitshadnegligibleeffects.MLGloweredtheurbanGinicoefficientby0.002in2013,buturbanresidents’health insurancehadnoobservableeffect.Overall,post-transferincomeinequalitieswerehigherin2013thanin2002becausepre-transferincomeinequality (incomesbeforetakingintoaccountsocialbenefits)increasedsignificantly duringthattime.

Socialpolicieshavemeanwhilehadlimitedeffectsinreducinginequalities betweenregions,betweenmigrantsandurbanresidents,andbetweenwomen andmen.Regionaldisparities—particularlybetweenlargecoastalcitiesand theruralhinterland—remainstark.Migrantsarestillmuchlesslikelyto beneﬁtfromsocialprovisionsthaneitherurbanorruralresidents(Gaoetal., 2013;Gaoetal.,2019;Wangetal.,2016).Muchlessoftenresearchedand discussed,butjustassigniﬁcantandserious,arethegenderinequalities. Shenetal.(2016:76)foundthatpatternsofinequalitiesintransfersfor publichealthcareandpensionswere‘remarkablybiasedagainstwomen’, whileZhuandWalker(2018:1419)foundthatwomen’spensionswereon average30percentlowerthanthoseofmen.

Overall,then,theChineseParty-state’ssocialpoliciesreinforcedorcompoundedinequalitiesandsegmentedthepopulation,whiletheirmarketizing componentsalsocreatedtheirowninsecurities.Atthesametime,they facilitatedpro-marketeconomicpoliticsbyreducingoppositiontomarketinsecurities.Thisapproachavoidedpoliticallydifﬁcultredistributions (reducinggovernmentexpendituresonpublicservantsandurbanmiddle classes,forexample,inordertoincreasespendingonpoorfarmers)orsubstantiallyraisinggovernmentexpenditures,anditenabledtheCCPtoretain

10.DatafromtheNationalBureauofStatisticsofChina,availableat:www.data.stats.gov.cn

urbansupportwhilereducingdissatisfactionamongpreviouslyneglected, left-behindsegmentsofthepopulation.11

CONCLUSION:COMMUNISTIDEOLOGYANDSTATECAPITALISM

Ofcourse,theParty-statefacesmanydifficultieswhentryingtotackle socialproblems.Itmustmanagethechallengesofdismantlingstateplanning duringthedemographictransitiontoanageingpopulationandthehealth transitiontoasocietywithagreaterburdenofchronicratherthancontagious diseases(Gaoetal.,2019).Atthesametime,itfacestheproblemofensuring policiesareimplementedandpreventingfundsbeingsiphonedawayfrom publicspendingbycorruptofficialsacrossitsvastterritoryandfivelevels ofgovernmentadministration.

TheseproblemsandthedarksidesofsocialpolicyinChinaundermine thecaseforChinaasastraightforwardmodelforotherdevelopingcountries.Chinamaybeoneofthefewlow-incomecountriesforwhichmarket liberalizationhasledtosustainedhighlevelsofgrowth,anditmayhave successfullyreducedextremepoverty.ButChina’sGinicoefﬁcientisextremelyhighandoveraquarterofthepopulationstillliveonlessthan US$5.50aday—thedeﬁnitionofpovertyforanupper-middleincome countrylikeChina.Whilethismightseempreferabletothedirepovertyand lackofprogressinsomeoftheworld’spoorestnations,policymakersin developingcountrieswoulddowelltoconsiderthehighlevelsofinequality,insecurityandsegregationthathaveaccompaniedgrowthinChinaand whethertheycoulddobetterthanadoptasimilarlyneoliberalapproachto development.

WherethendoesChinaﬁtinthepost-1980sneoliberaleraofnewright andpopulistpolitics?China’sneoliberal-lookingeconomicpolicies,andthe socialpoliciesthathavefacilitatedandsupportedthem,resemblethepolicies ofright-wingpartieselsewhereintheworld,whotendtofavour‘conservative’welfareregimesthatsimilarlysegmentprovisiontoprotectthebeneﬁts oftheelite.12 ButthisdoesnotnecessarilymaketheChineseParty-state anallyoftheright-wingelsewhere.First,therulingChineseCommunist Partyinformaltermsespouses‘socialismwithChinesecharacteristics’— somethingthatenablesittoretaintheappearanceofideologicalcontinuity

11.Thereissomeevidence,basedonsocialsurveyresearchinChina,thatsocialpolicies—or hearingaboutthem—canincreasesupportfortheParty-state;seeforexampleLu(2014). Moreover,neoliberalpoliciesinChinareceivesomesupportfromtheurbanelitebecause thissegmentofthepopulationhasbeneﬁtedthemost.Butthosepoliciesarealsosupported becausetheyhavehelpedreducestatepowerineconomicenterprisesandinsociety— rememberingthatChina’sneoliberal-lookingpolicieswereintroducedaftermorethantwo decadesofstateeconomicplanningandalmosttotalitarianpoliticalcontrol(Tsou,1986).

12.Forexample,JapanandmanycountriesofLatinAmerica.Forathoroughanalysisof segmentationinLatinAmerica,seeFranzoniandSanchez-Ancochea(2018).

(‘socialism’)withoutmanyofitspolicyconstraints.Thepreciseformulation theCCPadoptedinthelate1980swasthatitwasguidingChinathrough the‘primarystageofsocialism’(referringbacktoMarxisttheory)andin sodoing,merelymimickingcapitalismwhileinfactdevelopinga‘socialistmarketeconomy’.13 ThisenablesParty-statedecisionmakerstoopenly embracemarketsandmarketefﬁciencyinthenameofsocialism.14 Atthe sametime,theCCP’sgriponpowerhasmeantthatinsteadofnewpartiesof theright(orleft)emergingtochallengeitspolicies,right–leftdebateshave takenplace within theCCP.Inthisway,China’sauthoritarianpoliticshave seen‘right-wing’,neoliberal-lookingeconomicandsocialpoliciesemerge ina‘communist’or‘socialist’system,andthenbechallengedbyanintraPartyNewLeft.ButChina’sright-wingpoliciesarenotbesttermed‘New Right’,becausetheyareneitherstraightforwardlyeconomicallyliberalnor sociallyconservative—atleastnotopenlywithintheCCP(PanandXu, 2018;Zhang,2019).15

ThepoliticsthatshapesocialpoliciesinChinaarealsodifferentfrom right-wing‘populism’inmanyotherpartsoftheworld.Although21stcenturysocialpolicieshavefocusedonnewprogrammesforthelargenumber ofruraldwellerswhohadbeenhithertoneglected,theCCPisnotappealing tomasssupportinordertowinelectionsashavemostotherpopulistleaders andpartiesinrecentyears.Norareitspoliciespresented,asinconventionaldeﬁnitionsofpopulism,aspittingordinarypeopleagainstacorrupt elite.Furthermore,whileChina’scurrenttopleader,XiJinping,hassometimesbeenlabelledasapopulistduetohisnationalismandhard-hitting anti-corruptioncampaign(Babones,2017;Perry,2015;Tang,2016;Zhang, 2019),mostofthesocialpoliciesdiscussedinthisarticlewereintroduced beforeXibecametheCCP’stopleaderin2012.

Instead,authoritarianpoliticsarecentraltounderstandingbothChina’s neoliberal-lookingeconomicreformsanditssocialpolicies.DengXiaoping introducedeconomicreformsinordertoshoreupsupportfortheCCPafter thedamagingultra-leftismofthe1960sand1970s.Fromthelate1990s, theCCPthenusedsocialpoliciesinresponsetocriticismsoftheresulting socialproblemsandinequalities(saidbysomecriticstobeinappropriate underacommunistparty)aswellastofurthereconomicgrowth,reduce politicaldissatisfactionandpre-emptprotest.Thus,socialpolicieshave beenusedtohelpbuildandretainsupportforcontinuedCCPrule.Butthey havebeenfacilitatedbythearrayofmediaandsocialcontrolstheCCPhas developedoverits70yearsingovernment.ThePeople’sRepublicofChina

13.ForausefuldiscussionofideologicalevolutioninChina,seeHolbig(2013).

14.MarketswerecontroversialandcontestedamongsomeinthePartyinthe1980s,but oppositiontothemwanedfromtheearly1990s.

15.AlthoughtheCCPisinsomewayssociallyconservative—inrelationtofeminismand homosexuality,forexample—itsconservatismisnotunderpinnedbyreligionandithas movedinsmallwaysinaliberaldirection.

thereforeshowshowadaptiveauthoritarianregimescanbeinﬂuencedby globalideasandpolicytrends,aswellashowtheymayveryeffectively andsubstantiallyshiftboththeirideologyandpoliciesinordertomaintain power.

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JaneDuckett (Jane.Duckett@glasgow.ac.uk)isEdwardCairdChairofPolitics,SchoolofSocialandPoliticalSciences,UniversityofGlasgow,United Kingdom.HerresearchinterestsareinChinesepolitics,localgovernment, socialandhealthpolicy.Herbooksinclude TheEntrepreneurialStatein China (Routledge,1998)and TheChineseState’sRetreatfromHealth (Routledge,2011).