By Richard Baum, Ph.D., University of California, Los Angeles
In 1980s, China faced the problems of rise in income disparities and urban inflation. By the mid-’80s, a significant income gap had opened between self-employed getihu, who were free to charge market prices for their goods and services, and skilled professionals in the state sector, such as teachers, scientists, and doctors, who lived on relatively low fixed incomes.
Hong-yan-bing: The Red-eye Disease
The hardship experienced by members of the underpaid white collar and professional classes was revealed in a number of poignant aphorisms overheard on the Chinese street. One was, gao yuanzidande buru mai chajidande, meaning “Those who make atomic bombs earn less than those who sell tea eggs”; another went kaidaode buru lifade, which meant “The surgeon who operates on your brain makes less than the barber who cuts your hair.”
The term widely used in China to describe the resentment and envy that stemmed from rising income disparities was hong-yan-bing, or “red-eye disease.”
Hong-yan-bing was not so much an outgrowth of “some people getting rich before others,” as Deng Xiaoping had anticipated, but rather it reflected the fact that those who were getting rich, as often as not, did so through no particular talent or virtue of their own.
They did it either through the happenstance of being self-employed at a time of mounting inflation, or (in the case of many government officials and enterprise managers) being well positioned to collect corrupt, under-the-table rents for the preferential allocation of scarce state-controlled resources such as business licenses, building and zoning permits, foreign exchange certificates, and other regulatory instruments used to control market access in the new, semi-reformed Chinese economy.
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Average Income and Gini Coefficient
Before the onset of China’s economic reforms in 1978 and 1979, the ratio of average incomes earned by people in the top and bottom 20 percent of the Chinese population was only about 2.5:1. By the late 1980s, however, this ratio had more than doubled, to almost 6:1.
In the same 10-year period, China’s Gini coefficient—a measure of relative income inequality, where 0 equals perfect equality and where everyone has exactly the same income, and 1 equals perfect inequality wherein one person takes in all the money—rose dramatically. The rise was from .18, which was one of the lowest in the world, to .38, which was at that time the highest of any socialist country.
However, it should be noted that economists generally disagree on the implications of a rising Gini coefficient. This is because the early stages of market-driven economic growth are most often accompanied by a significant rise in income disparities. Thus, most economists regard a modest rise in the Gini coefficient in the early stages of development as a sign of economic health and dynamism.
But when the Gini coefficient approaches .40, as China’s did by the end of the 1980s, many economists regard this as a potential warning sign, portending a rise in social discontent.
Learn more about the effects of globalization in China.
The Rise in Income Disparities
As a reflection of a growing popular uneasiness over rising income disparities, Chinese opinion polls in the mid-1980s began to show a decline in the public’s enthusiasm for market reform.
One poll conducted early in ’86 revealed that only 29 percent of urban residents felt that the reforms were providing equal (or near-equal) opportunity for all. By November of the same year, fully three-fourths of urban respondents were expressing dissatisfaction with rising commodity prices.
Other polls revealed a changing youth culture, one that was becoming significantly more materialistic and hedonistic, and considerably less idealistic.
Anti-liberalization and Anti-spiritual Pollution Campaigns
As socio-economic stresses in the marketplace grew stronger, orthodox Marxists ratcheted up their efforts to maintain the sanctity of traditional socialist institutions and values.
The first signs of this were seen in the anti-liberalization and anti-“spiritual pollution” campaigns of the early ’80s. Those early campaigns had targeted the cultural decadence and moral degeneracy, ostensibly spawned by Deng Xiaoping’s policy of “reform and opening up.” Now the conservatives sharpened their knives once again, this time in an effort to roll back the reforms themselves.
Although Deng Xiaoping and his more liberal-minded associates studiously avoided using the scare-word “capitalism” to describe their reforms, more orthodox Marxists were not nearly so inhibited. Nor were they fooled by Deng’s use of euphemisms such as “socialism with Chinese characteristics.”
As social stresses increased, and consumer satisfaction decreased, the traditionalists took advantage of mounting urban angst to launch an ideological counterattack against capitalism and its corrosive effects.
Learn more about the opposition to liberalization in art.
Social Disturbances in China
The debate over the dangers of capitalism and bourgeois liberalization was punctuated in 1985 and 1986 by a fresh epidemic of small-scale social disturbances. On the surface these disturbances appeared random, spontaneous, and almost wholly unrelated to one another.
In May of 1985, a riot occurred at a Beijing sports stadium, when a Hong Kong soccer team unexpectedly defeated the local Chinese club. Soon afterward, a group of three hundred “sent-down youths” staged a noisy sit-in at the headquarters of the Beijing municipal government, demanding the right to return to their homes in the Chinese capital.
In Tianjin, a race riot erupted on a local college campus on Sino-African Friendship Day. A similar incident occurred in Nanjing, where a group of male Chinese students accused African exchange students of sexually harassing local Chinese women.
And in Tiananmen Square, over 1,000 students demonstrated in September of 1985 in protest over the Japanese prime minister’s visit to the Yasukuni Shrine in Tokyo, a Shinto War Memorial that honored, among others, the militarists who launched World War II. Significantly, it was China’s largest street demonstration since Fu Yuehua’s petitioners’ march of January 1979.
Urban distress was clearly rising, and China’s college students, long a barometer of underlying societal tensions, were growing increasingly restive.
Common Questions about China in 1980s: Rise in Income Disparities and Social Disturbances
Hong-yan-bing or “red-eye disease” was a term widely used in China to describe the resentment and envy that stemmed from rising income disparities.
Gini coefficient is a measure of relative income inequality, where 0 equals perfect equality and where everyone has exactly the same income, and 1 equals perfect inequality wherein one person takes in all the money.
The anti-liberalization and anti-“spiritual pollution” campaigns of the early ’80s had targeted the cultural decadence and moral degeneracy, ostensibly spawned by Deng Xiaoping’s policy of “reform and opening up.”
