Beneath the China Boom:

Labor, Citizenship, and the Making of a Rural Land Market

Under contract with UC Press

         In 2007, I was a graduate student with an interest in the Chinese economy.  It was just a year before the global financial crisis, but even then the economy was showing signs of a shift away from its traditional export growth base.  Profits were continuing to accrue within manufacturing, but the new growth area was in construction and real estate, sure sign of a robust domestic market, an emergent middle class.

         That summer, I traveled to Beijing, hoping to catch a glimpse of what this construction boom looked like on the ground.  There, I became familiar with a gang of construction workers hailing from Sichuan Province, deep in the hinterland.  Among them was a rural worker, a 33 year-old man named Little Deng.  Little Deng often had difficulty securing pay for his work.  He would fall back on the efforts of his family in his home village.  Deng’s wife, Yue-na, lived in a two-story house, built with his accumulated wages, in Fa-ming Village, 2000 km from Beijing, or a 33 hour ride on the slow-train.

         My examination of China’s construction boom soon took me on a sojourn far beyond the purview of coastal cities like Beijing and Shanghai.  Many workers I met in Beijing were like Little Deng: they shuttled back and forth between inland villages and coastal cities.  The tactic was what scholars call a “safety-first” practice: it allowed them to retreat back to rural farms during times of unemployment.  Migrant laborers around the world live such dual lives.  In China, migrants like Little Deng have become foundational to China’s developmental strategy of labor-intensive export production.  They work during economic booms, then return home to farm in villages during economic crises.  For example in 2010, just after the reverberations of the global financial crisis had emptied China’s factory floors, Little Deng spent a forlorn year in a failed search for work.  He had left the village with 500 RMB (US $83), and a one-way train ticket to Guangzhou, where a village friend got him a job at an electronics factory.  After his first month Little Deng was fired when production slowed.  Then he found work as a wood-worker at a Beijing construction site.  But within another month, a rumor spread that subcontractors had disappeared, leaving workers without wages.  By mid-year, Little Deng returned home, but not before incurring a debt of 1100 RMB (US $182).  His family weathered the year because Yue-na had opted to stay behind in Fa-ming, raising their son and farming their few plots of village land which sustained them despite the losses Little Deng incurred in migration.

         I soon learned that rural villages, deep in the Chinese hinterland, play a central but hidden function in the national economy.  This is where the vast labor force retreats when production slows down.  It is also, however, a changing and uncertain place.  The brighter the skylines of Beijing and Shanghai, the more deteriorated the rural inland: crumbling roads, closed schools.  The higher the GDP growth rate of cities, the more stagnant the rural economy and job prospects therein.  It is the argument of this book that these phenomena are related, indeed the poverty of the hinterland enables the dynamism of cities.

         Yet rural China is also changing.  In peri-urban peripheries, rural governments have changed their developmental strategy.  Local governments, squeezed by the rising costs of social expenditures, are turning toward land sales for revenues, seizing land from households and diverted it toward urban expansion and contract farming.  Much of this urban construction, moreover, is speculative in character: high-margin real estate and commercial building, with no guarantee of future sales.  Within a single generation, rural China has replaced its socialist communes with speculative real estate zones.  Across rural China, at least 88 million people have lost their access to farming land in the current wave of rural land expropriations, the driving force behind what is now the world’s most rapid urbanization.  Many like Little Deng could in the past withstand the vicissitudes of the urban markets by maintaining households in villages.  Today they are growing fewer and farther between.

         Beneath the China Boom argues that China is in the midst of a transition between two models of development, each produced in a post-socialist context where vestiges of central planning have long suppressed rural development in order to subsidize urban growth.  The first model of development is the story of China’s low-cost labor advantage, stemming from the widespread employment of laborers from the countryside.  The second is a story of China's urbanization, driven by rural governments, which stave off fiscal deficits by selling and redeveloping the village land that workers’ families farm, and drive an urbanization boom that overrides the limits of demand.

         Both dynamics are currently ongoing in the economy.  As a result of tensions between the two, at least 88 million rural people to date have been urbanized in situ, deprived of collective use-rights to village land.  Beneath the China Boom follows the trajectories of these rural workers.  It tracks the effects of China's de facto land privatization on rural people, the new urbanization that follows, and its tendency to outlast and override state regulations.  The result is a view of the undertow of China’s economic success, and the periodic crises — a rural fiscal crisis, a runaway urbanization — which it first creates and then must resolve.

Julia Chuang