Wealth Rises in China with Increasing Social Cost

With the release of the most recent China “rich list,” it was discovered that the number of billionaires in China had doubled. Meanwhile, resentment is escalating among other members of Chinese society who are not on the winning end of China’s economic reforms. The Los Angeles Times blog looks at the rising tensions between rich and poor in China:

There’s a growing unease about the gap between rich and poor in China — a rift that appears to be widening and threatening the government’s motto of stability at all costs.

“Becoming rich through honest work and legal means is glorious. But at the same time, the public is worrying that the widening wealth gap between rich and poor is hurting social harmony,” read an official New China News Agency editorial Friday.

To put the disparity in perspective, the vast majority of China’s 1.3 billion people aren’t even subject to income taxes because they earn too little. Only 24 million people make the minimum $545 monthly income necessary to be taxed, according to the Ministry of Finance.

China’s per-capita annual income of $7,600 ranks below that of Angola and Albania.

As food and property prices move higher, populist resentment grows. Take away outrage over the privileged elite, corruption and mistresses and there would be a lot less to write about on China’s wildly popular micro-blog services.

The issue has been in the spotlight in recent months following a number of incidents in which wealthy and privileged members of society displayed public outbursts of contempt for regular citizens. (See, for example,the “My father is Li Gang” incident”). In recent days, the Chinese media and cyberspace has been in an uproar over the behavior of Li Tianyi, the teenage son of People’s Liberation Army general and singer Li Shuangjiang, who attacked a couple blocking his way as he illegally drove his father’s BMW in Beijing. From the Diplomat:

Last Thursday, Li Tianyi, 15, and his friend, Su Nan, 18, allegedly severely beat a couple in a Buick that had been driving just ahead of them. During the attack, one of the boys was heard to shout: ‘Who dares to call 110?’ (110 being the Chinese police emergency line). It’s an almost perfect sound bite for the internet age.

What has been most disturbing for Chinese netizens, and most embarrassing for Li Tianyi’s father, renowned PLA singer Li Shuangjiang, is that his son was driving a heavily-customised BMW underage and without a licence. But because he is below the age of criminal responsibility, the boy reportedly won’t be charged for his part in the affair. Li Shuangjiang has promised the assaulted couple that there will be a ‘settlement’ following all this.

The question now is how much longer the majority of Chinese will allow the wealthy and privileged to use their influence to bend the law?

The answer isn’t clear, not least because society here is so heavily built around the concept of guanxi, or personal relationships. China can be a bureaucratic nightmare – ask any small or medium sized enterprise looking to source products or register their business in China. But a good network of friends and acquaintances can help turn any major obstacle into a minor setback with just a phone call.

Guanxi greases the wheels of society. But it is also the fuel for the fire that is corruption and arrogance. The unfortunate truth for many here is that they are less interested in overthrowing the ‘oppressors’ than in becoming one of them (an idea captured perfectly by George Orwell in 1984, when he noted ‘One does not establish a dictatorship in order to safeguard a revolution; one makes the revolution in order to establish the dictatorship.’)

China Daily reports that a journalist in Shanxi has claimed that Li Tianyi’s friend Su Nan is himself the son of the deputy head of the Shanxi Public Security Department. The Wall Street Journal blog looks at the reaction to Li Tianyi’s behavior from netizens, which was quick and ruthless:

News of the incident eventually made it online, where it revived memories of Li Qiming, the son of a police chief in Hebei province who hit and killed a young woman while driving on a university of campus and then attempted to bully his way past security guards shouting “My dad is Li Gang!” (The two sets of Lis aren’t related.)

“I think this has to do with how he’s been educated at home,” commented a user of China’s popular Sina Weibo microblogging service writing under the name Muse Dongcheng. “Could it be Li Gang is his uncle?”

Thousands of other Weibo users have also piled on, with many taking the episode as yet another example of the brazen behavior of the country’s privileged elite.

Second-generation rich, second-generation officials, second-generation celebrities…before you learn to make money, you should probably learn how to be human,” added another Weibo user, Xiaowang Tiankong888.

Read more about the gaps between rich and poor in China today via CDT.


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