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Business Spectator: Peter Cai: Mao's proletariat paradise lost

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  • Abernethy, Virginia Deane
    Hi, Wonderful illustration of how utopian ideology does not not translate into best results. V.
    Message 1 of 6 , Jan 23, 2014
      Hi,
      Wonderful illustration of how utopian ideology does not not translate into best results.
      V.
      ...........................................................................................................
      Peter Cai: Mao's proletariat paradise lost
      http://www.businessspectator.com.au/print/763991 

      3 January 2014

      Peking University is one of the most prestigious institutions of
      higher education in China, dating back to the 19^th century when the
      last Manchu dynasty decided to set up a higher education institution
      modelled after Western universities.

      It is not an exaggeration to say that most school children in China
      crave a place at Peking University. Needless to say, competition
      for a much sought-after place is fierce. However, your chance of
      admission is much better if you come from the right background.

      Nearly one in three Peking University students come from families of
      the communist party cadres, the highest proportion since 1952,
      according to a comprehensive survey of student admission data
      between 1952 and 2002.

      Back in 1952, children of party cadres only made up one in ten
      admitted students at the university. In comparison, the proportion
      of students from farming backgrounds has been in decline since 1972,
      from 30 per cent to only 15 per cent in the late 1990s.

      These admission statistics shine a light on China's worsening social
      mobility, which is one of the most important contributing factors
      behind China's growing chasm between haves and have nots. So just
      how bad is the problem?

      Miles Corak from University of Ottawa has the latest answer from his
      international comparative study of the elasticity of
      inter-generational income, which is economist's parlance for
      measuring the impact of your dad's income on yours.

      In Australia the impact is 26 per cent, so there is an advantage of
      being born into a high-income family, but not that significant and
      we compare well with Scandinavian countries such as Denmark and
      Norway, which are known for their social equality.

      Though the United States maintains a national myth that anyone can
      get ahead, the reality is that the US has one of the lowest social
      mobility rates among OECD countries and comparable to class ridden
      Britain. Over there, the children of the higher income dad will earn
      47 per cent more.

      Then comes the shocker: the nominally communist China has one of the
      worst socially mobility rates of the 23 countries surveyed,
      including basket cases of socially inequitable countries like Brazil
      and Argentina. In China, children of the higher income family will
      earn 60 per cent more.

      So what happened to Mao's classless proletariat paradise?

      David Dollar, senior fellow at the Brookings Institute, and a former
      US Treasury representative in Beijing explains why.

      The first issue is China's hukou registration system, which operates
      more or less like an economic apartheid system that separates the
      population into urban and rural residents (China must end its
      economic apartheid [1], December 17.) Hukou makes it difficult for
      people to move around, especially from countryside to cities. If you
      were born into a farming family, a relatively low income occupation,
      it limits your opportunities significantly. Many good jobs in
      Beijing and Shanghai specify local hukou registration.

      [1]
      http://www.businessspectator.com.au/article/2013/12/17/china/china-must-end-its-economic-apartheid

      Secondly, China's educational resources are skewed toward major
      urban centres. Shanghai schools stood out on recent tests as among
      the best in the world. Famous British private schools like Harrow
      even boast campuses in Beijing.

      In China, schools are usually locally funded, which means prosperous
      areas can afford to lavish more resources on education while poor
      and especially rural areas lack the necessary resources.

      Thirdly, the country's growing corruption is hurting social mobility
      and generating widespread resentment. It is easier for elite
      families to pass on status and income to their children.

      For example, many of China's top leaders send their children to
      exclusive schools such as Harvard and Oxford for education.
      President's Xi Jinping's daughter is an undergraduate at Harvard and
      the son of the disgraced former senior party leader Bo Xilai went
      Harrow (Winston Churchill's old school), Oxford, Harvard and
      Columbia law school.

      Chinese princelings are also hogging senior positions in the
      commercial world. Former premier Li Peng's daughter runs the
      largest state-owned electricity company and his colleague Zhu
      Rongji's son is in charge of the country's largest domestic
      investment bank.

      China's low social mobility is ironic given the party still pays lip
      services to communist ideology. It is not only unjust but also
      hurting the legitimacy and efficiency of a market economy. China's
      ability to innovate is hampered if a large part of its population is
      not able to utilise their talents.

      There is a glimpse of light after the bold reform package announced
      at the Third Plenum of the recent party congress. Beijing
      understands the need to address the growing chasm between the poor
      and rich and boost the social mobility of the bottom half.

      Translating words into actions is a different proposition
      altogether.

    • Eric Pfeiffer
      Morning Virginia    The question I like to ask...was Mao a proponent in reality of a classless society?  He was a child in a wealthy family growing up
      Message 2 of 6 , Jan 25, 2014
        Morning Virginia
           The question I like to ask...was Mao a proponent in reality of a classless society?  He was a child in a wealthy family growing
        up knowing nothing of the plight of the poor about him. His educational attainment kept him in the isolated world of poetry,
        philosophy etc and far removed from any understanding or interaction with the vast underclass of China. 
             From there he moved into political power (gee this sounds a lot like any wealth/ political power story in any country) and
        forced his way to the top through dogma and sheer terror and maintained that power hold using those same tools (we certainly
        have seen that story repeated throughout the world with uninteresting variations on the book paraded by the masses through
        fear and intimidation).
              The name of the book held high by the fearful masses and those seeking power within the regime has changed giving rise
        to our endless "isms".  The power of the written word used by those in power to intimidate and coerce to maintain power has
        not changed over the centuries of human communication.
            Mao is the routine story of the wealthy maintaining power through the usual tried and true techniques. Mao was the upper
        1% as a child and remained the upper 1% throughout his life.  The China power structure merely changed hands with his
        emergence. The class society of China was never challenged nor was there ever any attempt to change it by Mao. He
        could not change what he never knew about.
            He did bring forced industrialization by forcing people off the land and into the factories. But the class system remained
        very much intact, it just migrated to the factories with some window dressing for appearance sake.

        From: "Abernethy, Virginia Deane" <virginia.abernethy@...>
        To: energyresources@yahoogroups.com
        Sent: Friday, January 24, 2014 12:03 AM
        Subject: [energyresources] Business Spectator: Peter Cai: Mao's proletariat paradise lost
         
        Hi,
        Wonderful illustration of how utopian ideology does not not translate into best results.
        V.
        ...........................................................................................................
        Peter Cai: Mao's proletariat paradise lost
        http://www.businessspectator.com.au/print/763991 

        3 January 2014

        Peking University is one of the most prestigious institutions of
        higher education in China, dating back to the 19^th century when the
        last Manchu dynasty decided to set up a higher education institution
        modelled after Western universities.

        It is not an exaggeration to say that most school children in China
        crave a place at Peking University. Needless to say, competition
        for a much sought-after place is fierce. However, your chance of
        admission is much better if you come from the right background.

        Nearly one in three Peking University students come from families of
        the communist party cadres, the highest proportion since 1952,
        according to a comprehensive survey of student admission data
        between 1952 and 2002.

        Back in 1952, children of party cadres only made up one in ten
        admitted students at the university. In comparison, the proportion
        of students from farming backgrounds has been in decline since 1972,
        from 30 per cent to only 15 per cent in the late 1990s.

        These admission statistics shine a light on China's worsening social
        mobility, which is one of the most important contributing factors
        behind China's growing chasm between haves and have nots. So just
        how bad is the problem?

        Miles Corak from University of Ottawa has the latest answer from his
        international comparative study of the elasticity of
        inter-generational income, which is economist's parlance for
        measuring the impact of your dad's income on yours.

        In Australia the impact is 26 per cent, so there is an advantage of
        being born into a high-income family, but not that significant and
        we compare well with Scandinavian countries such as Denmark and
        Norway, which are known for their social equality.

        Though the United States maintains a national myth that anyone can
        get ahead, the reality is that the US has one of the lowest social
        mobility rates among OECD countries and comparable to class ridden
        Britain. Over there, the children of the higher income dad will earn
        47 per cent more.

        Then comes the shocker: the nominally communist China has one of the
        worst socially mobility rates of the 23 countries surveyed,
        including basket cases of socially inequitable countries like Brazil
        and Argentina. In China, children of the higher income family will
        earn 60 per cent more.

        So what happened to Mao's classless proletariat paradise?

        David Dollar, senior fellow at the Brookings Institute, and a former
        US Treasury representative in Beijing explains why.

        The first issue is China's hukou registration system, which operates
        more or less like an economic apartheid system that separates the
        population into urban and rural residents (China must end its
        economic apartheid [1], December 17.) Hukou makes it difficult for
        people to move around, especially from countryside to cities. If you
        were born into a farming family, a relatively low income occupation,
        it limits your opportunities significantly. Many good jobs in
        Beijing and Shanghai specify local hukou registration.

        [1]
        http://www.businessspectator.com.au/article/2013/12/17/china/china-must-end-its-economic-apartheid

        Secondly, China's educational resources are skewed toward major
        urban centres. Shanghai schools stood out on recent tests as among
        the best in the world. Famous British private schools like Harrow
        even boast campuses in Beijing.

        In China, schools are usually locally funded, which means prosperous
        areas can afford to lavish more resources on education while poor
        and especially rural areas lack the necessary resources.

        Thirdly, the country's growing corruption is hurting social mobility
        and generating widespread resentment. It is easier for elite
        families to pass on status and income to their children.

        For example, many of China's top leaders send their children to
        exclusive schools such as Harvard and Oxford for education.
        President's Xi Jinping's daughter is an undergraduate at Harvard and
        the son of the disgraced former senior party leader Bo Xilai went
        Harrow (Winston Churchill's old school), Oxford, Harvard and
        Columbia law school.

        Chinese princelings are also hogging senior positions in the
        commercial world. Former premier Li Peng's daughter runs the
        largest state-owned electricity company and his colleague Zhu
        Rongji's son is in charge of the country's largest domestic
        investment bank.

        China's low social mobility is ironic given the party still pays lip
        services to communist ideology. It is not only unjust but also
        hurting the legitimacy and efficiency of a market economy. China's
        ability to innovate is hampered if a large part of its population is
        not able to utilise their talents.

        There is a glimpse of light after the bold reform package announced
        at the Third Plenum of the recent party congress. Beijing
        understands the need to address the growing chasm between the poor
        and rich and boost the social mobility of the bottom half.

        Translating words into actions is a different proposition
        altogether.

      • Frank Holland
        No surprise, Virginia, after all the Chinese are simply following the British and American trends that the power elite intend to stay that way by ensuring that
        Message 3 of 6 , Jan 26, 2014
          No surprise, Virginia, after all the Chinese are simply following the
          British and American trends that the power elite intend to stay that way
          by ensuring that their children use all the advantages possible.

          Frank
          UK

          On 24/01/14 06:03, Abernethy, Virginia Deane wrote:
          > Though the United States maintains a national myth that anyone can
          > get ahead, the reality is that the US has one of the lowest social
          > mobility rates among OECD countries and comparable to class ridden
          > Britain.
        • Abernethy, Virginia Deane
          Frank, How funny. You think that the white man is so powerful that he is responsible for CHINA s inequality? Get real. China is more in control of its own
          Message 4 of 6 , Jan 26, 2014
            Frank,
            How funny. You think that the white man is so powerful that he is responsible for CHINA's inequality? Get real. China is more in control of its own destiny that almost any other country in the world.
            V.
            ________________________________________
            From: energyresources@yahoogroups.com [energyresources@yahoogroups.com] on behalf of Frank Holland [frankholland3@...]
            Sent: Sunday, January 26, 2014 3:28 AM
            To: energyresources@yahoogroups.com
            Subject: Re: [Bulk] [energyresources] Business Spectator: Peter Cai: Mao's proletariat paradise lost

            No surprise, Virginia, after all the Chinese are simply following the
            British and American trends that the power elite intend to stay that way
            by ensuring that their children use all the advantages possible.

            Frank
            UK

            On 24/01/14 06:03, Abernethy, Virginia Deane wrote:
            > Though the United States maintains a national myth that anyone can
            > get ahead, the reality is that the US has one of the lowest social
            > mobility rates among OECD countries and comparable to class ridden
            > Britain.
          • papp20032000
            Few comments on Mao. I visited China and worked intensively with officials of the public companies in establishing the very first bunch of joint ventures in
            Message 5 of 6 , Jan 27, 2014

              Few comments on Mao.


              I visited China and worked intensively with officials of the public companies in establishing the very first bunch of joint ventures in the telecommunication field from 1984 to 1986.


              But I had followed closely before the many political moves in this country, since the early times of the Revolution, passing through the Cultural Revolution and finally arriving to the topple of the so called “gang of four” and the ascent of Deng Xiaoping (it does not matter if the cat is black or white, but if it hunts mice or not)


              For many years, the inequality in China had been abolished. They were really trying hard to avoid that. There was even very specific policies during Mao and the Cultural Revolution to get this. They told me that at the beginning of the Revolution, they noticed that the children of the former expropriated nobles and principals, were again raising and learning faster in the schools than the children of the real proletarians. This is obvious, because they riches before the revolution even expropriated or confiscated, still kept the culture and education in their parents. So, to avoid the new castes or high classes placing again their children in top positions, they decided that in the classrooms, the smartest and better trained children had to help their schoolmates in such a form that either all the students passed the next course or no one could pass it, to encourage cooperation.


              Another symbol that astonished me was to observe that in the Red Army, there were only two hierarchical levels: soldiers and officials, even when I was visiting China and Mao had already died and Deng Xiaoping was already ruling the country and running it to capitalism. The officials had four pockets in their Mao jackets; the soldiers only two. I asked them how could they organize a several million troops Army without ranks and they answered me: easy: we do have similar levels of hierarchy than in the Western Armies, but here each official ruling a group in each level has the obligation to know all the soldiers under him. And the soldiers the obligation to know their immediate superior. No need, therefore, like in Spain, to make the military salute to a superior in the streets when meeting or crossing him.


              Salaries were basically the same from the lowest to the highest. Bicycles, an expensive good these days and the almost absolute mean of urban transport, apart from public buses, were parked by thousands without lockers in the streets. I presume that if a single Chinese was tempted to steal one and appear with two bicycles in his commune, he will be immediately scorned and/or denounced by all his/her neighbors. There were no reasons to accumulate money or any type of wealth, because the society, the whole social environment, did not accept that. Housing, education, food, etc. were very similar for the 800-1 billion people there. Even the one child policy was strictly applied to all, including the highest cadres in the Party. I asked my translator (a lady) about this one-child policy and she confessed that this was the toughest policy for them, not the political situation.


              When I was invited to visit their factories (many telecom factories throughout the country), I was taken in the only official car of the company (no individuals had privates cars these years). I was accompanied by a translator, the president of the company, the chief engineer and the driver. If I was invited to lunch, the driver and the translator were sharing the table with the president and chief engineer and with the same food.

              Inequality? No much with Mao. Inequality started to raise again with the advent of Deng Xiaoping, who established again capitalism in China. Deng was purged a couple of times by Mao and his Party colleagues. He was sent to rural communes to do rural jobs, like carry dung to the farm fields, a very necessary and decent job, that I would strongly recommend to many Western politicians as a method to learn humility. He was smart enough to survive and move again towards the Central Committee and targeted for a second time. But he recovered and finally got the power. His position, was never officially a high one. In China at least in these days, the most powerful was never the higher in an official ranks. Many vice presidents had much more effective power than presidents.


              I tried many times to give tips to boys inside my hotel room, where I was sure nobody was watching them, but in this days, no one would accept a single yuan or remimbi. Very different than today.


              In my opinion, what has really created inequality has been the adoption of wild capitalism, something in which Deng proved to be a master, surpassing the most capitalistic countries. My former company has already closed down virtually all the factories in Europe and has located the biggest ones in China. I sometimes feel guilty for having started and contributing to the technology transfer that then was copied and extended by many other Western multinationals.


              Pedro



              ---In energyresources@yahoogroups.com, <virginia.abernethy@...> wrote:

              Frank,
              How funny. You think that the white man is so powerful that he is responsible for CHINA's inequality? Get real. China is more in control of its own destiny that almost any other country in the world.
              V.
              ________________________________________
              From: energyresources@yahoogroups.com [energyresources@yahoogroups.com] on behalf of Frank Holland [frankholland3@...]
              Sent: Sunday, January 26, 2014 3:28 AM
              To: energyresources@yahoogroups.com
              Subject: Re: [Bulk] [energyresources] Business Spectator: Peter Cai: Mao's proletariat paradise lost

              No surprise, Virginia, after all the Chinese are simply following the
              British and American trends that the power elite intend to stay that way
              by ensuring that their children use all the advantages possible.

              Frank
              UK

              On 24/01/14 06:03, Abernethy, Virginia Deane wrote:
              > Though the United States maintains a national myth that anyone can
              > get ahead, the reality is that the US has one of the lowest social
              > mobility rates among OECD countries and comparable to class ridden
              > Britain.
            • Frank Holland
              As always a very interesting mail from Pedro. He reminds me of the time in the late 1970s when I was building a chemical plant in Denmark, the company had one
              Message 6 of 6 , Jan 29, 2014
                As always a very interesting mail from Pedro. He reminds me of the time
                in the late 1970s when I was building a chemical plant in Denmark, the
                company had one canteen which everybody used. The CEO invited me to join
                the dinning table he was sitting at, and he introduced me the the fellow
                diners, mainly plant operatives and one salesman I think, and they all
                knew each other well. And of course Denmark is one of the least unequal
                societies, and it certainly was a pleasure to work there.

                Frank
                UK, a very unequal society.

                On 27/01/14 21:21, papp20032000@... wrote:
                > Few comments on Mao.
                >
                >
                > I visited China and worked intensively with officials of the public
                > companies in establishing the very first bunch of joint ventures in the
                > telecommunication field from 1984 to 1986.
                >
                >
                > But I had followed closely before the many political moves in this
                > country, since the early times of the Revolution, passing through the
                > Cultural Revolution and finally arriving to the topple of the so called
                > “gang of four” and the ascent of Deng Xiaoping (it does not matter if
                > the cat is black or white, but if it hunts mice or not)
                >
                >
                > For many years, the inequality in China had been abolished. They were
                > really trying hard to avoid that. There was even very specific policies
                > during Mao and the Cultural Revolution to get this. They told me that at
                > the beginning of the Revolution, they noticed that the children of the
                > former expropriated nobles and principals, were again raising and
                > learning faster in the schools than the children of the real
                > proletarians. This is obvious, because they riches before the revolution
                > even expropriated or confiscated, still kept the culture and education
                > in their parents. So, to avoid the new castes or high classes placing
                > again their children in top positions, they decided that in the
                > classrooms, the smartest and better trained children had to help their
                > schoolmates in such a form that either all the students passed the next
                > course or no one could pass it, to encourage cooperation.
                >
                >
                > Another symbol that astonished me was to observe that in the Red Army,
                > there were only two hierarchical levels: soldiers and officials, even
                > when I was visiting China and Mao had already died and Deng Xiaoping was
                > already ruling the country and running it to capitalism. The officials
                > had four pockets in their Mao jackets; the soldiers only two. I asked
                > them how could they organize a several million troops Army without ranks
                > and they answered me: easy: we do have similar levels of hierarchy than
                > in the Western Armies, but here each official ruling a group in each
                > level has the obligation to know all the soldiers under him. And the
                > soldiers the obligation to know their immediate superior. No need,
                > therefore, like in Spain, to make the military salute to a superior in
                > the streets when meeting or crossing him.
                >
                >
                > Salaries were basically the same from the lowest to the highest.
                > Bicycles, an expensive good these days and the almost absolute mean of
                > urban transport, apart from public buses, were parked by thousands
                > without lockers in the streets. I presume that if a single Chinese was
                > tempted to steal one and appear with two bicycles in his commune, he
                > will be immediately scorned and/or denounced by all his/her neighbors.
                > There were no reasons to accumulate money or any type of wealth, because
                > the society, the whole social environment, did not accept that. Housing,
                > education, food, etc. were very similar for the 800-1 billion people
                > there. Even the one child policy was strictly applied to all, including
                > the highest cadres in the Party. I asked my translator (a lady) about
                > this one-child policy and she confessed that this was the toughest
                > policy for them, not the political situation.
                >
                >
                > When I was invited to visit their factories (many telecom factories
                > throughout the country), I was taken in the only official car of the
                > company (no individuals had privates cars these years). I was
                > accompanied by a translator, the president of the company, the chief
                > engineer and the driver. If I was invited to lunch, the driver and the
                > translator were sharing the table with the president and chief engineer
                > and with the same food.
                >
                > Inequality? No much with Mao. Inequality started to raise again with the
                > advent of Deng Xiaoping, who established again capitalism in China. Deng
                > was purged a couple of times by Mao and his Party colleagues. He was
                > sent to rural communes to do rural jobs, like carry dung to the farm
                > fields, a very necessary and decent job, that I would strongly recommend
                > to many Western politicians as a method to learn humility. He was smart
                > enough to survive and move again towards the Central Committee and
                > targeted for a second time. But he recovered and finally got the power.
                > His position, was never officially a high one. In China at least in
                > these days, the most powerful was never the higher in an official ranks.
                > Many vice presidents had much more effective power than presidents.
                >
                >
                > I tried many times to give tips to boys inside my hotel room, where I
                > was sure nobody was watching them, but in this days, no one would accept
                > a single yuan or remimbi. Very different than today.
                >
                >
                > In my opinion, what has really created inequality has been the adoption
                > of wild capitalism, something in which Deng proved to be a master,
                > surpassing the most capitalistic countries. My former company has
                > already closed down virtually all the factories in Europe and has
                > located the biggest ones in China. I sometimes feel guilty for having
                > started and contributing to the technology transfer that then was copied
                > and extended by many other Western multinationals.
                >
                >
                > Pedro
                >
                >
                >
                > ---In energyresources@yahoogroups.com, <virginia.abernethy@...> wrote:
                >
                > Frank,
                > How funny. You think that the white man is so powerful that he is
                > responsible for CHINA's inequality? Get real. China is more in control
                > of its own destiny that almost any other country in the world.
                > V.
                > ________________________________________
                > From: energyresources@yahoogroups.com
                > <mailto:energyresources@yahoogroups.com>
                > [energyresources@yahoogroups.com
                > <mailto:energyresources@yahoogroups.com>] on behalf of Frank Holland
                > [frankholland3@... <mailto:frankholland3@...>]
                > Sent: Sunday, January 26, 2014 3:28 AM
                > To: energyresources@yahoogroups.com <mailto:energyresources@yahoogroups.com>
                > Subject: Re: [Bulk] [energyresources] Business Spectator: Peter Cai:
                > Mao's proletariat paradise lost
                >
                > No surprise, Virginia, after all the Chinese are simply following the
                > British and American trends that the power elite intend to stay that way
                > by ensuring that their children use all the advantages possible.
                >
                > Frank
                > UK
                >
                > On 24/01/14 06:03, Abernethy, Virginia Deane wrote:
                > > Though the United States maintains a national myth that anyone can
                > > get ahead, the reality is that the US has one of the lowest social
                > > mobility rates among OECD countries and comparable to class ridden
                > > Britain.
                >
                >
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