Could China’s enormous fiscal stimulus package be fueling protests?
Kerry Brown, a senior fellow at Chatham House, the UK think tank, claims there’s an unofficial figure floating around for the number of "mass incidents" last year.
He said it was 103,000 – well above the 80,000 or so that most people have estimated since the Chinese government stopped publicizing the figure in 2005.
That’s a huge figure, especially when we all thought the number of protests had dipped because of the Olympics.
This year, however, I expect the number will be even higher. Not because of the various "sensitive" anniversaries (50 years since the Dalai Lama fled into exile, 60 years of Communist Party rule, 20 years since the Tiananmen Square protests) but because of all the money sloshing around in the Chinese economy.
In the past two weeks, we’ve now seen two violent protests at steel plants where the workers fought off attempts at privatization.
In Jilin province, "more than 1,000" workers at Tonghua Iron and Steel group rioted and killed the top executive at the private company that was looking to buy the mill.
Then, over the weekend, the privatization of Linzhou Iron & Steel in Henan was called off after 3,000 workers blocked a government mediator from leaving the plant.
Worker protests have been in the spotlight in the past few months (although the usual caveat applies that we don’t know whether there have been more of them, or whether it’s just that the media has been allowed to report more of them).
The stimulus cash may be to blame. The extra money in the system is inflating some prices – food and property – and also inflating the expectations of workers.
Wages have risen in coastal factories, and that news has now filtered back inland. Workers at state-owned steel mills might reasonably expect some of this year’s 7 trillion of new bank loans to trickle down to them. And if it doesn’t, they are sure to be angry at the managers who pocketed the cash.
Over at the China Labour Bulletin, they have studied 100 worker protests between 2007 and 2008. A third were triggered by non-payment of wages, benefits and compensation. A further third were caused by demands for higher pay, shorter hours and better benefits.
And when it came to moral outrage or economic interests, "both were clearly viewed with equal importance by the workers themselves."
The workers are also aware that local governments are flush for the first time in years. It is no surprise that a local official was taken hostage in Henan.
With money to burn, and a strong incentive to keep the peace ahead of the all-important 60th anniversary of Communist Party rule in October, local governments are willing to pay off protesters with cold hard cash.
It’s simple blackmail, but with this much money sloshing around, you can bet that plenty of other workers are going to try and grab some of it before the year is out.