My Oped in today’s New York Times on China’s Social Mobility

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The Opinion Pages | OP-ED CONTRIBUTOStuck at the Bottom in China

By LIJIA ZHANGNOV. 28, 2016

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CreditDominic McKenzie

BEIJING — In the early 1980s, China’s top leader, Deng Xiaoping, is said to have issued his now-famous rallying cry in defense of a market economy. “Let some people get rich first,” he reportedly said, making the case that the Communist Party’s embrace of a freer market would generate new wealth that would eventually spread to all strata of society.

Indeed, Deng’s so-called reform-and-opening-up policy, first launched in 1978, spurred incredible economic growth. China has seen the emergence of private businesses and a vastly expanded middle class. In the early days of the reform period, social mobility increased notably, producing many rags-to-riches stories.

But after decades of breakneck economic growth, the country’s wealth has ceased trickling down, bringing social mobility to a standstill. Chinese people have fewer opportunities to move up the socioeconomic ladder. State-controlled capitalism and corruption have led to the demise of the Communist ideal of a classless society.

A 2014 nationwide survey by a market-research company suggested that intergeneration mobility in China among the low- and lower-middle class has stagnated, and people from those groups had little confidence that they could improve their fate. Among those who self-identified as lower-middle class, 68 percent said their parents also belonged to the lower-middle class, and 87 percent of people in the lower class said their parents were in the same class. In short, the majority of lower class people in China are staying near the bottom of the class pyramid.

A Stanford report from earlier this year echoes what Chinese social scientists have found: China ranks high among countries in which citizens earn close to what their parents had earned. It is a country with low “intergenerational earnings mobility,” meaning China’s younger people are likely to be in the same socioeconomic class as their parents.

Research shows the bigger the income gap, the lower the social mobility. And the income gap has been widening steadily. A report from Peking University in January found China to be one of the most unequal societies in the world with the richest 1 percent holding a third of the country’s wealth.

When the rungs of the income ladder grow farther apart, it’s more difficult for people to climb upward.

While some 800 million people in China have been lifted out of poverty in the last few decades, the economic reforms have produced a new underclass of low-paid urban workers, including migrants from the country’s rural areas. The new lower class is stuck at the bottom.

The hukou, a household registration system that ties social benefits, including children’s schooling, to a person’s birthplace, has been a main factor behind the class entrenchment. The system, which is slowly being reformed, has meant most rural migrants living in cities get minimal access to social benefits and their children often go to substandard schools.

Meanwhile, the wages of low-income laborers have not kept up with increases in the cost of living. And as economic growth continues to slow, low-income workers are unlikely to see significant gains in wages anytime soon.

Many of those people who heeded Deng Xiaoping’s call to get rich were small-business owners — and entrepreneurship remains a route to enrich oneself. But, as Wang Jianlin, one of Asia’s richest men, said in a speech at Harvard in 2012, it’s difficult for a private company to have success in China. State-owned enterprises still enjoy favorable treatment from the government, giving them a competitive edge over private businesses. The successful entrepreneurs are often those, such as Mr. Wang, who have easy access to top officials.

Access matters in such a corrupt society. Ever since the introduction of the market economy, corruption has been expanding. It is repeatedly cited in surveys as a top concern of the public.

At the core of the corrupt culture are wealthy businessmen, state monopolies, private-property developers and government officials. In China, the government controls not only a large portion of the wealth but the market itself. Those who are close to powerful officials have access to financial resources. This system feeds on itself, making the rich richer and the powerful more powerful. “A waterfront pavilion gets the moonlight first,” as the Chinese would say.

Education used to serve as one of the few class equalizers. “In books, one can find beauty and golden mansions,” as the traditional saying goes. Throughout imperial China, young men from humble backgrounds often became wealthy officials after passing through the civil-service examination system.

But today, education is failing to help people move up the social ladder. Like everything else in the market economy, education has become a commodity. The better a university, the more expensive it is. Children from impoverished families struggle to afford college, even if they succeed in passing the strict entrance examination. Children from the countryside face more hurdles: Many of the spots in the better urban universities are reserved for local students, putting rural residents at a disadvantage. One report from last year said the percentage of university students from a rural background is half of what it was 30 years ago.

For the vast majority of children of migrants living in cities, the race is lost before they reach college age. Because of the many barriers for migrants to enroll their children in legitimate city schools, parents often send them to hometown schools or substandard city schools for migrants run by staff who lack proper qualifications. Struggling in a legal gray area, many migrant schools are frequently shut down by authorities.

Even if some migrant children manage to complete a university education, they face an increasingly competitive job market in which “a good dad works better than a good grade.”

We Chinese have seen vast wealth transform our country in a generation. Those who have yet to benefit from the nation’s success need some hope that, with hard work, they too can move up the social ladder. Underprivileged people who feel trapped in their class may eventually take to the streets to protest how the system is rigged against them.

If the Chinese government is serious about wanting to foster a stable and harmonious society, it should address the limits on social mobility before it’s too late.

Lijia Zhang is the author of the forthcoming novel “Lotus.”

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