Home » Labor rights
Category Archives: Labor rights
By Wu Qiang, March 17, 2015
As photos of the protests by Shuangyashan miners make the rounds on social media, we are witnessing a crucial turning point in China’s history: the beginning of a long depression, of the type predicted to take place in cycles by Russian economist Nikolai Kondratiev. After 25 years of continual growth beginning in 1992, China’s period of economic prosperity has ended, and now the decline has begun. China will face a future downward trajectory that will have far reaching implications for its own political system, and for the economic and political configuration of the world.
The problem is that this transformation won’t be peaceful. Instead, it will be marked by the kind of mass worker protests seen on March 12, in Shuangyashan, Heilongjiang (黑龙江双鸭山). Heilongjiang’s governor, Lu Hao (陆昊), addressing the press at the “Two Sessions” in Beijing, said of the province’s largest coal company: “The Longmay Mining Group has 80,000 coal miners, and as of this day they have not missed one month of salary or taken a single paycut.” Not long afterwards, thousands of workers took to the streets and to train stations, protesting Longmay’s withholding several months of salary, making it difficult for them to even cover living expenses. They held banners saying “Lu Hao Is Blatantly Lying,” and “We Want to Live, We Want to Eat,” demanding that they get their salary and social security payments. The protest was suppressed by thousands of paramilitary police, and dozens of the workers and residents who yelled slogans have been ordered to be arrested.
Just how this conflict will develop, or expand, has yet to be seen. The Chinese economy has been quietly approaching an inflection point on the Kondratiev wave for the last few years—but the Shuangyashan protest is a formal announcement of the beginning of the transformation: for a long period from here on out, economic depression will be accompanied by mass unemployment and continual waves of worker protests. Xi Jinping has been making alterations to China’s political model to prepare for a long period of economic decline that will, the regime hopes, not result in shattering its rule.
To begin with, this preparation comes from the economic theories of Li Keqiang known as the “Likonomics.” In 2013, just after Li Keqiang had become the Prime Minister, he proposed using electrical output, coal consumption, and rail freight volume as the three main indicators of economic activity—a means of sweeping aside the usual faked numbers and data used to calculate economic growth by GDP. The numbers showed that China’s production, import, and consumption of coal reached their peak and then began dropping in 2013. In 2014 and 2015 China’s coal output dropped 3.5% each year. The price of coal collapsed precipitously, and by the end of 2015 the pithead price of a ton of coal in Shanxi, a major coal producing region, sat at between 180 and 190 yuan. But the cost at large mines is 278-340 yuan a ton—meaning that there is about 100 yuan of loss for every ton of coal. According to figures from the China Coal Association published at the end of 2015, there were financial losses across 90% of the industry.
Meanwhile, although every year Chinese GDP growth figures only show a minor drop, the example of the coal industry shows that the circumstances are probably far worse. While China’s electricity consumption in 2015 dropped about 20%, another index that I have long observed—the consumption of instant noodles—appears to have begun its decline even earlier than coal. It’s been trending downwards for four years, dropping 10.6% industry-wide in 2014. The average number of packs consumed per person was 30, far less than the world’s number one, Korea (71 packs) and number two, Vietnam (60). In part there is no doubt that the widespread use of high speed rail has reduced the passenger load on regular trains, in which much of this consumption is done—but the more important factor is that it signals a reduction in the number of migrant workers, who have traveled from the countryside to the cities, providing abundant cheap labor to power China’s manufacturing economy.
In fact, the National Bureau of Statistics on April 29, 2015 published a report aimed at identifying the number of migrant workers. It said that though the number had seen a small increase, since 2010 its rate of growth has been in decline. Clearly this population is already insufficient to be relied upon for cheap labor. Or, perhaps, it’s the low cost of living, and the cheap cost of social welfare represented by instant noodles, that have been the prerequisites for 25 years of constant economic growth, or a period of “instant noodle prosperity.”
Strangely enough, “Likonomics” has all but faded in public discourse, while the “supply-side reforms” of “Xikonomics” is raising its head. So-called supply-side reforms refer to economic structural adjustments, reducing overcapacity, emptying inventories, and deleveraging—all these are part of the package of economic structural adjustments proposed by Xi Jinping in November 2015. This advanced version of “taking the old bird out of the cage and putting in a new bird” clearly aims at changing the structure of China’s economy, promoting clean industry, high-tech development, and attempting to reduce the emphasis on coal, oil, steel, and the other traditional backbone industries.
Late last year and early this year, mass layoffs were announced at Wuhan Iron and Steel, Panzhihua Iron and Steel, and PetroChina, and the closure of a number of wells at the Shengli Oil Field was announced. Before this, as early as 2013, Li Keqiang had begun work on rebuilding “exhausted resource areas,” and the transformation of shantytowns around mines and factories, investing a massive amount of capital, and carrying out preventative-style resettlement of the worker populations likely to be effected by the above industrial movements. Lu Hao, a rising political star with a Youth League lineage like Li Keqiang, was parachuted into Heilongjiang as all this went on to take over as governor. But the bad, ingrained habits of Heilongjiang, or the whole northeast, are hard indeed to overcome: in 2014 the cash losses at Longmay in Shuangyashan, the largest coal enterprise in the province, had already come in at 4 billion yuan.
To judge the Longmay incident and its fallout, we must examine the fate of a series of labor rights NGOs in China last year. In preparing for a long period of economic decline, Xi Jinping and Li Keqiang have been working in lockstep on precautionary measures: upgrading shantytowns in the mining regions on one hand, and on the other suppressing labor organizations. Staving off the impact of a declining economy is the most important mission of the current administration. A similar series of labor protests in the Pearl River Delta led to a comprehensive strike-hard campaign against labor NGOs. Clearly, given the serious fears that the highest leaders in China harbor against nascent worker movements, they’re willing to spare no effort.
All the same, the crackdown has not stopped self-organized worker protests. The Shuangyashan demonstration was on the surface triggered by a few hasty words from governor Lu Hao, but the deeper and more important point is that China’s period of “instant noodle prosperity” has finished. Now that the decline has set in, no system of wealth redistribution, or change in relationship between labor and capital, or between social classes and the state, will be able to compensate for the losses that will be suffered by workers as industries are eliminated. When the economy was on the rise, the compensation for urban dwellers and lower classes could be supported through selling real estate or revenues from emerging industries.
The previous Hu Jintao and Wen Jiabao administration’s “stability maintenance” policies were established in a period of prosperity, on the basis of preserving class interests. The current economic malaise is going to break all these old relations. As of now, apart from an ever-increasing cost of suppression, there is no negotiation over class interests or arrangements to alleviate the brunt of the slowdown. Thus, conflicts will continue to erupt.
All this is directly responsive to President Obama’s comments in a recent article in The Atlantic, a review of the president’s foreign policy: although Obama is satisfied with his success in containing China, he’s still full of concern about its coming economic downturn, and worries that it might spark conflict with the United States. He is worried that China’s internal conflicts will, whether directly or indirectly, impact international relations or even the global order.
The good news is, China’s economic slowdown will help realize the global 2030 emissions reductions goals sooner. But who can predict what changes the next ten years of “negative prosperity” will bring to China?
Wu Qiang (吴强), who taught political science at Tsinghua University until last year, is currently a freelance commentator and researcher of social movement.
Two recent short documentaries:
The end of the Chinese miracle | FT Features, Mar 9, 2016
In China, A Surge in Strikes, New York Times, March 14, 2016.
Also by Wu Qiang:
The Four Forces of China’s Politics of Smog, March 15, 2015.
Urban Grid Management and Police State in China: A Brief Overview, August 8, 2013.
A 2016 New Year’s Message from China’s Labor Community
Dear fellow workers, compatriots, and friends from around the world: Happy New Year!
Toward the end of 2015, the labor community in China experienced an unprecedented attack. A group of activists who have dedicated years to defending the rights and interests of workers were detained, monitored and interrogated by the police. It could have been a moment for fear and paranoia to set in. But those in the labor community and other walks of life responded quickly by drafting a petition to the Communist Party Central Committee, National People’s Congress, and State Council. The petition described in no uncertain terms the severe and widespread violations of workers’ rights and interests over the last few decades, and the inevitable emergence of independent labor NGOs and worker centers and their valuable contribution to the protection of labor rights and social justice, and demanded the release of the detained activists. In less than two weeks, over 490 people added their names to this petition, and over 60 Chinese lawyers joined a legal aid team. This response was followed by petitions, appeals, and demonstrations by over 200 organizations and thousands of individuals from the international labor and academic community in over 40 countries condemning the crackdown and expressing support for the arrested labor activists.
Their calls, however, fell on the deaf ears of the Chinese authorities. The detained activists have to this day still not been allowed to meet with their lawyers. In addition, the Communist Party’s propaganda apparatus—the Xinhua News Agency, People’s Daily and China Central Television (CCTV)—launched a smear campaign against these activists, in particular Zeng Feiyang (曾飞洋), essentially sentencing them without a trial in the court of public opinion. Feiyang’s wife and child have been intimidated, and Zhu Xiaomei (朱小梅) has been separated from her baby daughter, whom she was breastfeeding when she was detained. The families of the other detained activists—He Xiaobo (何晓波), Meng Han (孟晗), Peng Jiayong (彭家勇), Deng Xiaoming (邓小明)—are all sick with fear, and the whereabouts of another former worker-turned-collective bargaining specialist, Chen Huihai (陈辉海), is still unclear. Their treatment reflects a cowardly approach to the rule of law, and the criminal proceedings are rife with legal and procedural unfairness.
Fellow workers, compatriots, and friends: If the rights and interests of workers who make up the large majority of China’s population cannot be protected, if workers are increasingly deprived of their economic, political, cultural, and social rights, if the confrontations between officials and citizens, workers and employers, rich and poor, continues to worsen, then what are the prospects for everyone to live in a free, equal, fair, democratic, law-based society where “socialism is the core value”? It is doubtful that even our most basic survival and security can be assured in such a society!
It follows then that defending and fighting for workers’ rights and interests is not only essential for workers, but also to the stability, security, fairness, and well-being of society as a whole. Labor rights activism is not a crime! Labor rights organizations have not committed any crime! Labor rights activists have not committed any crime! Not only are they are not guilty of any crime, they have also made great contributions to our society, state, and nation. They are the underlying force behind a labor movement that has emerged in waves since 2010. They are why people from all walks of society are increasingly paying attention to, and supporting, the labor movement.
China’s 30 years of rapid economic growth is already in its last gasps. Now, demographics are changing, reducing the labor force, and the environment is severely damaged. At the same time, social contradictions and historical debt hidden by growth are surfacing one after the other. Government, businesses, and workers face the dual burden of an economic recession and social instability, and workers bear the greatest share: in times of economic growth they gain the least, and in downturns they inevitably lose the most. Not only are they the first to lose their jobs and fall into poverty, but as soon as they protest they are repressed by the government’s stability maintenance apparatus.
How can it be that the working class is fated to ceaselessly bear all the costs through economic growth as well as recession? Why should the powerful reap the profits when the economy grows and flee in times of recession? In early 2015, the labor community made a proposition to the government known as “the New Deal for Workers,” suggesting reforms to the system of wealth distribution, and universal social insurance coverage. It could be a way to boost domestic consumption, but this requires the government and businesses to give a bigger piece of the pie to labor and society. Similar policies helped the United States make it through the Depression of the 1930s, but do Chinese officials have that kind of heart and will?
Fellow workers, compatriots, and friends, it’s true that we wait on the government to appraise the situation and put forward the correct policy, but we also know that freedom, equality, justice, safety and happiness are things that we cannot wait for—they can only be obtained by fighting for them. We may have to make sacrifices if we choose to fight, but we will gain nothing without fighting for it.
In this new year, labor activism may face an even grimmer situation. But we are convinced that the labor movement will keep advancing. The rights to organize, bargain collectively, and to strike, and the economic, political, cultural, and social rights of workers, will all be achieved step by step.
“Strong grows the grass on plains made rich with blood, in winter-frozen earth spring starts to quicken.” Let this couplet be the labor community’s New Year Greetings that also set our outlook for 2016.
January 1, 2016
 Lu Xun, “Strong grows the grass,” translated by W. F. Jenner. (鲁迅《无题·血沃中原肥劲草》).
Chinese Authorities Orchestrate Surprise Raid of Labor NGOs in Guangdong, Arresting Leaders, Yaxue Cao, December 10, 2015.
Labour Activist Zhu Xiaomei speaking to workers, 2-minute Youtube video with English subtitles.
中文原文《寒凝大地发春华：中国劳工界2016年新年献辞》, translated by a volunteer.