To be rich in China, glorious or wrong?

Press, 4 August 1987, Page 49

To be rich in China, glorious or wrong?

By

MARK O’NEILL

NZPA-Reuter Peking China is having an intense debate about a woman grocer who has become fabulously wealthy by local standards and has raised the knotty question — is to be rich glorious or wrong? The “Economic Daily” said that it had almost 1000 letters from throughout China since it published a story about the grocer.

The woman at the centre of the storm is Guan Guangmei, aged 37, a Communist Party member who leased eight bankrupt or financially shaky grocery stores in her native Benxi in northeast China, and made them very profitable. As a result, she earned more than 44,000 yuan ($20,160) in two years — more than 100 yeans wages for the average Chinese peasant. Most letters quoted by the “Economic Dally” supported Guan and gave other examples of how other badly run State shops had been turned to

profit after being leased to individuals. The official newspaper, which said more than 10,000 such shops had been leased nationwide, did not give its own judgment A Western diplomat said the Communist Party itself was confused. "What Guan has done is perfectly legal, leasing small scale State shops and running them herself,” he said. “The leasing has improved service and efficiency and generated wealth. That is good. "But the party is on shaky ground ideologically. to justify such enormous discrepancies in income, so it is letting the debate go on.” The paper said the “Guan Guangmei phenomenon” had brought to light contradictions between the old planned system and reforms like decentralising power and stimulating the economy.

The reforms, since 1979, have enabled people like Guan, private businessmen and specialised farmers to earn incomes hundreds of times

higher than the average. They have also brought price rises, virtually unknown In Communist China before 1979, which meant that one-fifth of city dwellers had a drop in real income in the first half of this year. The “People’s Dally” gave the party line on income discrepancies in an editorial earlier this month.

“Some comrades are perplexed about differences in income, some even are doubtful about the reforms (which have produced them). This is clearly inaccurate,” it said.

While the number of those earning more than 500 yuan ($226.80) a year had increased sharply since 1979, the number of those earning less than 200 ($90.72) dropped sharply, showing the reforms had not caused discrepancies in income, it said.

“For a long period we had egalitarianism. But that meant not wealth for all, but poverty Tor all,” the newspaper said.