Evil Landlords

A Chinese History of Dispossession and Exploitation by Jim Yardley:

Even today, farmers in China have few property rights.

Twenty-five years ago, Deng Xiaoping unleashed the second big Chinese revolution by dissolving the communes and allowing farming households to keep the profits from anything they produced beyond state-set quotas. Farmers were granted leases, not ownership, to the land they worked. But the shift to household-based farming brought an immediate rise in rural incomes. At the time, it meant farmers were the first beneficiaries of economic reform in China.

By the 1990's, land reform focused on urban areas and granted city dwellers greater rights than farmers. Technically, the government maintained ownership of urban land as well. But a private real estate market was created for nearly everything built on that land. This set off a development boom that has raised fears of a bubble but made home ownership an essential investment for many urban residents. Farmers have been excluded, unable to own their own land or to buy in cities.

Urban expansion has made outlying farmland an inviting target for city governments. Cities like Shanghai, Beijing and Guangzhou have grown by annexing huge swaths of land. Smaller cities in every corner of the country have done the same.

In some cases, particularly in wealthier coastal provinces, farming villages have managed to negotiate fair compensation for confiscated land. Some have even transformed themselves into "urban villages" that rent land for profit. But more often, farmers have been exploited and even terrorized.

In October, Prime Minister Wen Jiabao announced administrative reforms to insure fairer compensation for farmers who lose land and to also make local governments more accountable to Beijing on land transactions. This year, the central government is already paying farmers direct subsidies to expand grain production. And Mr. Wen has ordered a gradual elimination of farm taxes.

But the long-term effectiveness of these changes is unclear.

The new land policy replaces earlier reforms that were also supposed to reduce illegal land seizures. A temporary freeze on economic development zones was lifted in November and already it appears that local governments are pushing forward with land grabs. More significantly, the new reforms do not address the fundamental issue of rural land ownership.

The elimination of farm taxes is putting pressure on local governments to find other sources of revenue. One response has been to seize rural land for development projects that generate fees and taxes. One study found that governments now take in more than 10 times as much from land transaction fees as from taxes on farmers.

Farmers, then, are starting to pay fewer taxes. But millions of them are losing their land in the process.