Two thirds of the Chinese population are employed in the agricultural industry, making this sector the top consideration affecting Beijing’s policies. Representing the bases of national living standards, consideration for rural residents is not merely a matter of winning their favor, but also a matter of the survival of the Chinese Communist Party. Throughout China’s history, food supply fluctuations have been at the heart of economic and political stability. Agriculture and China’s rural population form the foundation for sustainable growth and prosperity.
Income disparity between urban and rural citizens has been growing under the economic boom of the past quarter century; having fallen behind other areas of economic development over the past two decades, agriculture is once again a top priority. To ease pressures facing the rural population, the central government announced in March 2006 that agricultural taxes will be phased out over the next five years, a key event in the constant readjustment of agricultural policy in recent decades.
Following the Communist takeover in 1949, land was seized from landowners and given to the peasants, sealing Mao’s position as the undisputed leader of “New China”. But during the Great Leap Forward of 1958, the land was taken from the peasants again and put in control of communes. Famers faced production quotas and fixed pricing on yields sold directly to the state. The failure of the communes resulted in the largest famines in modern Chinese history.
In late 1978, Deng Xiaoping set a freer agricultural market in motion. The communes were gradually dissolved and replaced by the “household responsibility system”, whereby land allotments were contracted to farmers, shifting management responsibilities back to households. Wary of the potentially catastrophic risks inherent in hasty, large-scale reform movements like the Great Leap Forward, new policies have since generally been implemented gradually. Now, in the midst of the transition from a planned economy to a free market, prices of agricultural products are still subject to a measure of regulation, grain in particular. But reduced regulation has exposed China’s countryside to economic survival-of-the-fittest, where many lucky and diligent farmers are seen rising to affluence while others sink further into poverty.