Rich and Poor

China's economy continues to rise. But not everyone is ascending.

From Forbes:

Image from nataliebehring.com

Oct. 1 (Bloomberg) -- At China’s newest Gucci store, in Shijiazhuang, snakeskin purses sell for the equivalent of $4,390, about twice the city’s per capita annual income. Next door at Brooks Brothers, button-down shirts go for $190.

“Shijiazhuang is becoming very well off,” Brooks Brothers saleswoman Wang Weixia, 24, says of the provincial capital, 291 kilometers (181 miles) southwest of Beijing. “A few years ago it was poor and backwards.”

Five floors up in the food court of the First Under Heaven mall, a lamb kebab griller surnamed Li has a different view. “The people here got rich by cheating others,” says Li, who earns 50 yuan ($7.30) a day and declined to give his full name.

The scene in Shijiazhuang is replayed across China, where a 30-year economic boom has lifted hundreds of millions of people from poverty at the price of yawning income gaps. China’s Communists came to power 60 years ago today, promising a utopian society run for the benefit of peasants and workers. Instead, it was ideological foes in neighboring Taiwan and South Korea that delivered economic gains more widely and equitably.

The growing wealth gap is a top concern for President Hu Jintao and Premier Wen Jiabao, who are dealing with rising protests from workers and farmers angry at corruption and the perception that some people are getting rich at the expense of many. Hu and Wen today took part in celebrations in Beijing marking the anniversary.

In a Sept. 10 speech to the World Economic Forum in the city of Dalian, Wen said China must “narrow the gap in income distribution.”

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A rich man discarding trash onto the street. A relocated farmers picking up the refuse. Migrants huddled on street corners holding up signs saying 水电 (water electricity) looking for work. Little old ladies lugging massive carts of trash or recycled goods in bicycle lanes.

Although I've left China, these kinds of images are still burned onto my brain.

Having lived in a booming interior city of China, I've seen the income gap this article talks about first-hand. You see these scene play out walking down nearly every street in Xi'an.

China's growth is a great thing. It is making life better for millions upon millions of people. I hope that China's new-found wealth can trickle down to those not at the top rungs though. It can and has, but as the article goes on to say:

204 million people in China lived on $1.25 a day or less as of 2005, a 2008 World Bank study showed.

Expenses for health care and education, once provided at no cost for many workers, are pushing more people into poverty, said Dorothy Solinger, a professor at the University of California at Irvine who studies China’s urban poor.

“There isn’t a sense of upward mobility,” Solinger says. “There is a perpetuation of underclass.”

I'm not sure what the best way to curb income inequality is. More progressive taxes? I don't know. Whatever the solution may be, I hope that China's ever-widening gap can get under control. There are just too many people in China, and America for that matter, that are just barely getting by.