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China's unequal wealth-distribution map causing social problems

Recently, I ran into renowned sociologist Zhou Xiaozheng, who heads the Institute of Law and Sociology at Renmin University of China. Zhou, who is in his sixties, looks very gentlemanly in his smart, simple outfit, but when he talks he is all but gentle and moderate, getting right to the point.

Zhou is a regular commentator in talk shows on Chinese television and has recently been teaching Chinese Communist Party officials. In his courses he has vocally alerted them to China's manifold crises and social ills. Look at the Foxconn assembly line workers who keep jumping to their deaths, repeated incidents of children being chopped to death in Shenzhen and Shanghai, and local residents immolating themselves out of protest against their relocation by the government... “This is a never-ending chain of violence,” Zhou warned.

Where does the violence that pervades China come from? Its cause is nothing other than the drastic change in wealth distribution across the country.

Zhou explains that Communist China has seen two major turning points during its 60 year history: the first when it abandoned capitalism for “one equality” (everyone equally poor) — a path it pursued for thirty years — and the second which ended up with a society of “divided extremes” of wealth.

How Is Wealth Distributed Across China?

Between 2008 and 2009 the number of Chinese millionaires with assets worth more than 10 million renminbi rose from 825,000 to 875,000, according to rough estimates by the Chinese government. Within just one year, 50,000 more Chinese struck it rich.

The number of super rich with assets in excess of 100 million renminbi increased by 4,000 during the same period, from 51,000 to 55,000. China even has some 2,000 billionaires with assets of more than 1 billion renminbi and more than 100 mega rich worth more than 10 billion renminbi.

Not long ago Xincaifu (“New Wealth”), a monthly Chinese business magazine, came out with its latest list of China's 500 richest people, which showed that 88 had made their fortune in real estate, owning an average 7.38 billion renminbi per person.

The super rich at the top of the wealth pyramid are rapidly increasing, while the average peasant at the bottom earns less than US$5,000 per year.

In other words, some 310 million people in China have an income that is on a par with that of people in France or the United States, but there are also hundreds of millions living at the bottom of society in abject poverty. “Don't forget, China's current success is built on 300 million people taking advantage of 1 billion cheap laborers. And the unfair judicial system and the unfair distribution of wealth are making the challenges even greater,” Zhou says with a tone of stern reproach.

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