2013年2月2日 星期六

Inequality and happiness: DIVIDED CHINA: 天南地北/Inequality and happiness


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Inequality and happiness

I dream of Gini

Oct 12th 2011, 16:17 by The Economist online
The relationship between wealth, happiness and inequality
ECONOMISTS, trying hard to dispel a stubborn reputation as a gloomy bunch, have become fascinated with the relationships between wealth, inequality and happiness. There is evidence, at both an individual and a country level, of a relationship between income and happiness. Rich Denmark is happier than poorer China. But there are interesting wrinkles within that. As part of a report on measuring well-being published on October 12th, the OECD has crunched data from the Gallup World Poll, which asked people around the world how satisfied they were with their lives on a scale of one to ten, to reveal that the unhappiest Danes are much jollier than the unhappiest Chinese. But taken as a whole, the happiness gap (the gap between the least and the most satisfied) seems to have a weak relationship with income inequality, as measured by the Gini coefficient. That is odd, since many people automatically assume that inequality leads to misery.

DIVIDED CHINA 1: Growing disparity key challenge to leadership

photoCustomers transported in black German vehicles enter an exclusive club along the shores of West Lake in Hangzhou, China. (Atsushi Okudera)
Despite the booming economic growth in China over the past few years, the fruits of that prosperity have been out of reach for a large majority of the population.
This growing economic disparity will be a key issue at the National People's Congress, which convenes Saturday.
Although the Chinese economy grew fourfold in the decade until 2010, the average annual income of urban residents has increased to 3.2 times that of rural residents.
The Gini coefficient--a measure of inequality of wealth in a nation--continues to rise in China. One report found that 1 percent of households in China own about 40 percent of the nation's wealth.
"In order for each individual to enjoy the fruits of the reform and open-door policy, we have to not only make the cake bigger, but also work to better distribute it," Premier Wen Jiabao said over the weekend.
But are the new rich in China willing to part with their accumulated vested interests?
The Asahi Shimbun visited two locations to look into the yin and yang of the economic growth that has turned China into the world's second-largest economy.
* * *
Only the wealthy are welcome in West Lake area
HANGZHOU, China--The private rooms at the posh clubs in Western-style buildings that dot the lakeshore here are often lit by chandeliers.
The tables are covered by such delicacies as abalone and bird's nest soup. And just sitting at a bar can cost an ordinary individual a month's salary.
This area around scenic West Lake in Hangzhou, Zhejiang province, is a symbol of the luxurious lifestyle of a small sector of the Chinese population, a place where only the rich are welcomed.
"West Lake has become a heaven for the wealthy," said a 47-year-old taxi driver showing the fancy clubs to a visitor in late February. "Ordinary people cannot approach this area now because it has become so exclusive."
Although West Lake is located in the center of Hangzhou, it exudes an idyllic atmosphere. In the past, it provided an ideal location for locals to chat over drinks of longjing green tea.
Now, however, local businesses and influential individuals have gobbled up many of the historical buildings around the lake and turned them into fancy meeting places.
One such club, the Puti Jingshe, is owned by a construction company.
The club's general manager, Li Jun, said, "There are now more than 50 such clubs along the shore of West Lake."
Many of the clubs tried to maintain their exclusive nature. But that changed somewhat after the Communist Party organ People's Daily ran an article criticizing such meeting places as "rich men's clubs."
Under the direction of the municipal government, the meeting places were opened up to outsiders.
But still, not everyone can enter.
At the Huayuan Canting club, for example, an employee said, "At the least, you have to order abalone."
Some of the abalone came from Japan.
A party at the club can easily cost each individual 1,000 yuan (about 12,500 yen or $150).
That figure is the minimum monthly wage set by the Zhejiang provincial government.
When an Asahi Shimbun reporter asked if an item that cost only several dozen yuan could be ordered, an employee said, "Please don't do that because it will only make both of us uncomfortable."
The members-only Jiangnanhui club, whose members' list reads like a who's who of the area, charges an individual initial fee of 200,000 yuan.
It costs 30,000 yuan just to use a detached bar. The manager of the bar said only the world's best drinks were offered there.
Jiangnanhui has five rooms where guests can stay overnight. Although the rooms go for between 10,000 and 20,000 yuan a night, all the rooms were booked on the day the reporter visited.
Successful business people from Wenzhou and other nearby cities have congregated in Hangzhou, with many buying up real estate properties around West Lake.
The local Porsche dealer has a waiting list of 600 people for the Cayenne sport utility vehicle, which sells for close to 1 million yuan. A buyer usually has to wait for 18 months before a vehicle is delivered.
The Porsche outlet sells about 1,800 vehicles a year, making it one of the busiest Porsche dealers in the world.
Many workers employed at clubs that cater exclusively to the wealthy come from the Chinese interior.
For example, a 27-year-old man from a farming village who graduated from a university in Shanxi province works at a tea shop on the shores of West Lake. His monthly income is about 1,500 yuan.
"This society has become too unfair," he complained.
The female owner of the tea shop said, "I always tell my workers they will be able to succeed if they make the effort and save about 100 yuan a month."
She also operates a travel agency and two business hotels. Her annual income is between 3 million and 4 million yuan.
However, not all of that wealth is due to her hard work. One of her relatives is a high-ranking official in the local village government.
The secretary who is the top official of the village Communist Party unit uses the tea shop almost every night.
The owner admits that the secretary has been very helpful in offering advice on procedural matters as well as in introducing new customers.
All of the workers at the tea shop know about the situation. They say they do not pay much attention to the owner's lectures about working hard and saving money.
(This article was compiled from reports by Atsushi Okudera and Keiko Yoshioka.)

DIVIDED CHINA 2: Sinkholes bury hopes of prosperity in farming community


photoResidents were forced to live in temporary housing outside of Jining after sinkholes destroyed their homes. (Keiko Yoshioka)
JINING, China--While the rich devour posh real estate around West Lake in Hangzhou, the land has swallowed up people's lives in Jining to the north.
The city in Shandong province had been a major mining and wheat-growing area that helped fuel China's rapid economic growth.
But excessive coal mining led to huge sinkholes that have destroyed farming land and homes. Lakes have been formed by underground reservoirs that have filled the sinkholes.
Now, the land is an eyesore, the people are destitute, and their pleas for help from the government have gone unanswered.
"In summer the rain leaks, and it is cold in winter," said a man in his 50s living in temporary housing made of blue prefabricated material. "The roads are full of holes. My son will not be able to find a bride in such conditions."
The man's home and fields were lost in a sinkhole four years ago. He has no job now.
About 300 people in 100 households in a Jining community are struggling to make a living.
They share a common washing area and toilet. An iron gate was once installed at the entrance to the community, but it was stolen, likely by someone seeking to make a profit after metal prices soared.
Their main source of income is the government subsidy of 2,000 yuan (about 25,000 yen or $300) distributed for every 6.7 ares of farmland.
Each resident owns on average about 6.7 ares of wheat fields, so a couple receives 4,000 yuan a year.
Living near another sinkhole lake is a 50-year-old who only gave his last name of Wang. He also lost all of his farmland.
"Even after I lost my land, I received no old-age pension nor social security," Wang said. "The only thing I have is meager health insurance."
The local government constructed an apartment complex for the villagers, but it remains empty. The residents fear that they will lose their government subsidy for the farmland if they move.
They have so far avoided the new two-story apartment buildings painted white and yellow that stand like a ghost town on the outskirts of the village.
Jining had provided wheat and coal for urban areas, and prospects were promising when the consumption of coal, which provides about 70 percent of China's electricity, more than doubled over the past decade.
But according to reports in the People's Daily, the sinkholes began forming in the 1990s. At the end of 2009, the total area of such sinkholes reached about 23,000 hectares. About 100,000 residents were forced to move.
The land area of the sinkholes is expected to double by 2020. Sinkholes have also emerged in other parts of the nation.
Premier Wen Jiabao visited a village only a few kilometers from the sinkhole area during the Lunar New Year holidays in early February.
The purpose of the visit was to inspect farming regions in Shandong province suffering from drought.
Near the fields that Wen visited, large red banners have been hung from trees that say, "Let all party members and all people come together to combat the drought and engage in a people's war to bring us a bountiful harvest."
A 46-year-old who only gave his last name of Xu leaves the care of the wheat field to his family while he migrates to coastal areas to work on construction sites. He sends about 2,000 yuan a month back to his family.
When the busy harvest time comes around, he returns home.
"Although the prices of pesticides and fertilizers have gone up, the price of wheat has not risen as much," Xu said. "There is no way we can make a living unless I migrate."
Last year, Xu's daily wage increased by only 10 yuan.
Shandong province isn't the only wheat-producing region in northern China facing hardships.
The drought has affected a total area of 2.41 million hectares over eight provinces, making it the country's worst drought in history.