China Sec. 2

northern

______ china also faces a severe water shortage due to decreased rainfall, industrial expansion, and urbanization. to remedy this situation, the PRC has undertaken a multi-decal project to divert water from the Yangtze River in central China to the Yellow and two other rivers in the north. at a current estimated cost of over 60 billion, it is one of the most expensive engineering projects in history. it has also raised concerns among environmentalists that the diverted water will be so polluted by factories along its route that it will be unfit for use

socialist market

despite these changes, economic planning has by no means disappeared. officially, the PRC says it has a ______ ______ economy. while allowing a considerable degree of capitalism, national and local bureaucrats continue to exercise a great deal of control over the production and distribution of goods, resources, and services. market reforms have gained substantial momentum that would be nearly impossible to reverse. but the CCP still ultimately determines the direction of china's economy.

factories

economic life in rural china has also been transformed by the expansion of rural industry and commerce. rural ______ and businesses range in size from a handful of employees to thousands. they employ more than 160 million people and have played a critical role in absorbing the vast pool of labor that is no longer needed in agriculture. economic reform has made chinese society much more diverse and open. people are vastly freer to choose jobs, travel about the country and internationally, practice their religious beliefs, join non-political associations, and engage in a wide range of other activities that were prohibited under Mao. but economic change has also caused serious social problems.

iron rice bowl

economic reform has created significant changes in china's basic system of social welfare. the maoist economy provided almost all workers with what was Called _____ _____ ______. as in other communist party-state economies, such as the Soviet Union, the government guaranteed employment and basic cradle-to-grave benefits to most of the urban and rural labor force. the workplace was more than just a place to work and earn a living. it also provided housing, healthcare, day care, and other services. china's economic reformers believed that guarantees like these led to poor work motivation and excessive costs. they implemented policies designed to break the iron rice bowl. income and employment are no longer guaranteed. they are now tied to individual effort.

market government global

once he emerged as china's foremost leader in the aftermath of Mao's death in 1976, deng let the cat loose. he launched what is referred to as the Reform and Opening up policy to transform the Chinese economy. reform meant letting _____ forces play a greater role, while reducing ______ control, whereas opening up meant drastically increasing china's engagement with the ______ economy. authority for making economic decisions passed from bureaucrats to families, factory managers, and even the owners of private businesses. individuals were encouraged to work harder and more efficiently to make more money rather than to serve the people.

coal

one of the biggest downsides of china's economic growth has been the serious damage to the environment. industrial expansion has been fueled primarily by high polluting ______. the air in china's cities is among the dirtiest in the world. pollution has been linked to lower life expectancy in northern china. private automobile use is just starting to take off and is expanding rapidly, which will greatly add to urban pollution in addition to further snarling already horrendous traffic. china has surpassed the United States as the world's largest source of carbon dioxide emissions, although per capita emissions remain much lower than in most developed countries. pollution from china, much of it from export producing industries, carries across the Pacific Ocean and contaminates air quality in the western US.

village

one of the first revolutionary programs launched by the Chinese communist party when it came to power in 1949 was land reform that confiscated the property of landlords and redistributed it as private holdings to the poorer peasants. but in the mid to late 1950s, the state reorganized peasants into collective farms and communes in which the _____, not the individuals, owned the land, and local officials directed all production and labor. individuals were paid according to how much they worked on the collective land. most crops and other farm products had to be sold to the state at low fixed prices. collectivized agriculture was one of the weakest links in china's command economy because it was very inefficient in the way it used resources, such as labor, and undermined incentives for farmers to work hard to benefit themselves and their families. per-capita agricultural production and rural living standards were stagnant from 1957 to 1977.

industrial population

under Mao, the PRC built a strong ______ base. the people of china became much healthier and better educated. but the Maoist economy was plagued by political interference, poor management, and ill-conceived projects. this led to wasted resources of truly staggering proportions. china's economic growth rates overall, especially in agriculture, barely kept pace with _____ increases. the average standard of living changed little between the mid 1950s and 1976.

centrally economic

when the CCP came to power in 1949, china's economy was suffering from more than a hundred years of rebellion, invasion, civil war, and bad government. the country's new communist rulers almost immediately seized most property from wealthy landowners, rich industrialists, and foreign companies. they set up a ______ planned economy based on the soviet model. the state owned or controlled most ______ resources. government planning and commands, not market forces, drove economic activity, including setting prices for almost all goods.

market-leninihsm

The PRC has evolved in recent decades toward a system of what has been called _______-_______, a combination of increasing economic openness (a market economy) and continuing political rigidity under the leadership of a Leninist ruling party that adheres to a remodeled version of communist ideology. the major political challenges now facing the CCP and the country emerge from the sharpening contradictions and tensions of this hybrid system.

household responsibility families

after Mao's death in 1976, some commune leaders experimented with giving farmers more freedom to plant what they wanted, consume or sell what they produced, and engage in other economic activities, such as raising poultry, in order to increase their incomes. china's leaders not only allowed these experiments, but they embraced them as national policy to be implemented throughout the country. collective farming was abolished and replaced by the _______ _______ system, which remains in effect today. under this system, the village still owns the farmland but it is contracted out by the local government to individual _________, which take full charge of the production and marketing of crops. largely because farmers are now free to earn income for themselves, agricultural productivity has sharply increased. there are still many very poor people in the Chinese countryside, but hundreds of millions have risen out of extreme poverty in the last two and a half decades because of expanded Economic opportunities.

banks loans layoffs

but even SOEs must now respond to market forces. some have become very profitable, modern enterprises. but others are overstaffed economic dinosaurs with outdated facilities and machinery. the state-owned sector remains a severe drain on the country's _____ (largely government controlled) which are still sometimes required to bail out financially failing SOEs. these large ____ are rarely, if ever, paid back. many economists think that even more drastic SOE reform is needed. but the country's leaders have been unwilling to relinquish control of these important industries. they also fear the political and social turmoil that could boil up from massive _____ of industrial workers.

one child

china is often referred to as the factory of the world, because so many countries import large quantities of products made in the PRC. what makes these products competitive is the low cost of production, particularly wages. in 2009, the average factory job in china paid 1.34 per hour, while the US paid 32 per hour, but wages are rising in china because of a labor shortage due largely to the ____-____ policy. it is facing increasing competition for overseas investment from Vietnam, Bangladesh and other developing countries with lower labor costs. long-term growth will depend on a combination of exporting more sophisticated, less labor-intensive products and focusing the production of goods and services more on the domestic market.

production bureaucracies inequalities cities rural

china's planned economy yielded impressive results in terms of increased ______. but it also created huge ______ and new kinds of ______, especially between the heavily favored industrial _____ and the investment starved ______ areas. both the Great Leap forward (1958-1961) and the cultural revolution (1966-1976) embodies the unique and radical Maoist approach to economic development that was intended to be less bureaucratic and more egalitarian than the soviet model.

competition state-owned enterprises

in most sectors of china's economy today, the state no longer dictates what to produce and how to produce it. almost all prices are now set according to supply and demand rather than by administrative decree. most government monopolies have given way to fierce ______ between state-owned and non-state-owned firms. but there are still many thousands of _____ ______ _____ with tens of millions of employees in china. although vastly outnumbered by private business that employ more workers and account for abut 60 percent of china's GDP, SOE's still dominate critical sectors of the economy like steel, petroleum, telecommunications, and transportation

low demand modernize

in the early 1980s, as part of its reform and opening up, china embarked on a strategy of using trade to promote economic development. this followed model of export-led growth pioneered by Japan, South Korea, and Taiwan, which takes advantage of ____-wage labor to produce goods that are in ______ internationally. it then uses the export earnings to _____ its economy.

household registration

perhaps their greatest vulnerability is that their presence in the cities is technically illegal. beginning in the late 1950s, all Chinese were given either a rural or an urban ______ ______ (hokou) that was pegged for a specific location. they were not permitted to live or work in any other area. this system prevented the kind of uncontrolled rural flight that occurred in many other developing countries and led to the establishment of vast urban slums. but, by limiting the mobility of farmers, it also became the basis of deeply entrenched in equality between city and countryside. the authorities allowed the recent wave of migrants to move to the cities despite their rural hukous because their labor was crucial to economic expansion, but the migrants have no rights in the urban areas, including access to health care or education for their children, and can be evicted if the government chooses.

agriculture

some steps have been taken to improve the lot of the less well-off. in 2006, the government abolished taxes on ______, which had been in effect in some form in china for 2,600 years. by 2012, health insurance had been expanded to cover more than 90 percent of the population. but for most people the coverage is pretty minimal, and out of pocket expenses can be financially ruinous.

class coastal

the benefits of economic growth have reached most of china, but the market reforms and economic boom have created sharp _____ differences and inequalities between people and parts of the country have risen significantly. a huge gap separates the average incomes of urban residents from those in the countryside. the gap is also widening between the prosperous _____ regions and most inland areas. in the maoist era, china was one of the world's most egalitarian countries, and today it ranks with Brazil and South Africa as among the most unequal. surveys show that most Chinese don't resent such inequality as long as their lives are improving ad they believe their children's lives will be even better, but if economic growth slows significantly and people find their rising expectations dashed, glaring socioeconomic inequalities could become a source of discontent and instability.

people-centered

the new leadership under Xi Jinping that took over china in 2012-2013 has given high priority to promoting what is called ______-______ urbanization. the government has announced that urban registration will be extended to 100 million migrants currently living in cities while another 100 million will be moved to urban areas between 2014-2020. the government will also invest heavily in housing, schools, hospitals, and public transportation to meet the needs of the new city dwellers. this is a hugely ambitious undertaking that will have an enormous impact on the country's economic development, but china's leaders are well aware of the political implications of a project that will profoundly affect the lives of hundreds of millions of people.

stimulus

the results of the PRC's move from a planned toward a market economy have been phenomenal. china has been one of the fastest growing economies in the world for more than 20 years. GDP grew at an average rate of 10.3 percentage per year from 1992 to 2012. during the same period, India's GDP growth averaged 6.7, Brazil's 3.1 and the US 2.6. although growth has slowed to 7.7 in 2013, china has weathered global recession far better than any other major economy large because of a huge government _____ package.