[Joint House and Senate Hearing, 109 Congress]
[From the U.S. Government Publishing Office]




 
   CHINA'S HOUSEHOLD REGISTRATION (HUKOU) SYSTEM: DISCRIMINATION AND 
                                REFORMS

=======================================================================

                               ROUNDTABLE

                               before the

              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 2, 2005

                               __________

 Printed for the use of the Congressional-Executive Commission on China


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              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                    LEGISLATIVE BRANCH COMMISSIONERS

Senate                               House

CHUCK HAGEL, Nebraska, Chairman      JAMES A. LEACH, Iowa, Co-Chairman
SAM BROWNBACK, Kansas                DAVID DREIER, California
GORDON SMITH, Oregon                 FRANK R. WOLF, Virginia
JIM DeMINT, South Carolina           JOSEPH R. PITTS, Pennsylvania
MEL MARTINEZ, Florida                ROBERT B. ADERHOLT, Alabama
MAX BAUCUS, Montana                  SANDER LEVIN, Michigan
CARL LEVIN, Michigan                 MARCY KAPTUR, Ohio
DIANNE FEINSTEIN, California         SHERROD BROWN, Ohio
BYRON DORGAN, North Dakota           MICHAEL M. HONDA, California

                     EXECUTIVE BRANCH COMMISSIONERS

                   STEVEN J. LAW, Department of Labor
                 PAULA DOBRIANSKY, Department of State

                David Dorman, Staff Director (Chairman)

               John Foarde, Staff Director (Co-Chairman)

                                  (ii)


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

Wang, Fei-Ling, professor, the Sam Nunn School of International 
  Affairs, Georgia Institute of Technology, Atlanta, GA..........     2
Froissart, Chloe, Center for International Studies and Research, 
  Paris, France; Center for Research on Contemporary China, Hong 
  Kong, China....................................................    05

                                APPENDIX
                          Prepared Statements

Wang, Fei-Ling...................................................    28
Froissart, Chloe.................................................    35


   CHINA'S HOUSEHOLD REGISTRATION (HUKOU) SYSTEM: DISCRIMINATION AND 
                                REFORMS

                              ----------                              


                       FRIDAY, SEPTEMBER 2, 2005

                            Congressional-Executive
                                       Commission on China,
                                                    Washington, DC.
    The roundtable convened, pursuant to notice, at 2 p.m., in 
room 2168, Rayburn House Office Building, David Dorman (Senate 
Staff Director) presiding.
    Also present: John Foarde, House Staff Director; William A. 
Farris, Carl Minzner, and Keith Hand, Senior Counsels; 
Katherine Palmer Kaup, Special Advisor on Minority 
Nationalities Affairs; and Laura Mitchell, Senior Research 
Associate.
    Mr. Dorman. Well, let's get started. First of all, on 
behalf of our chairman, Senator Chuck Hagel, and co-chairman, 
Representative Jim Leach, I would like to welcome our two 
distinguished panelists today to this Commission roundtable to 
discuss the hukou system in China.
    Before we proceed, I would like to make a short statement. 
After the statement, I will introduce each of our witnesses, 
invite each to deliver a 10-minute statement in turn, and then 
we will move into a procedure where each person on the dais has 
five minutes to ask a question and hear an answer from the 
witnesses.
    We will continue asking questions and hearing answers until 
we reach 3:30, or we run out of questions. We have found that 
we do not really have much trouble filling 90 minutes, though, 
so I think we will be all right.
    China's hukou system has imposed strict limits on ordinary 
Chinese citizens changing their permanent place of residence 
since it was instituted in the 1950s. Beginning with the reform 
period in the late 1970s and accelerating through the late 
1990s, national and local authorities relaxed restrictions on 
obtaining urban residence permits.
    While these moves are a step forward, recent reforms often 
contain high income and strict housing requirements that work 
against rural migrants who seek to move to China's cities. 
Migrants who do not meet these requirements usually cannot 
obtain public services, such as health care and schooling for 
their children, on an equal basis with other residents.
    The Commission encourages the Chinese Government to 
continue hukou reforms, building on positive steps already 
taken, by focusing on measures that would continue to 
liberalize urban hukou requirements, but emphasize non-
discriminatory criteria and steadily eliminate current rules 
that link hukou status to public services.
    I would like to note that Carl Minzner, a Senior Counsel on 
the Commission, has been monitoring and reporting on this issue 
for about two years now. It is an issue of great importance--I 
do not need to tell either of our witnesses that--both in terms 
of Chinese socioeconomic development in general and in terms of 
its impact on the lives of individual Chinese citizens.
    We are very pleased that the two of you have agreed to 
participate in this roundtable today. This is an 
extraordinarily complex system, often difficult for Americans 
to understand, and we hope that this roundtable will help this 
Commission, and Congress, better understand the impact of the 
hukou system on human rights and rule of law development in 
China.
    First, I would like to introduce Professor Fei-Ling Wang. 
Professor Wang is from the Sam Nunn School of International 
Affairs at the Georgia Institute of Technology in Atlanta. 
Professor Wang teaches international political economy, world 
politics, and East Asian and Chinese studies. He has published 
four books, two co-edited volumes, and over 50 journal 
articles, book chapters, and monographs in five languages. His 
most recent book is ``Organizing Through Division and 
Exclusion: China's Hukou System,'' published by Stanford 
University Press in 2005. He holds a Ph.D. from the University 
of Pennsylvania. He has taught at the U.S. Military Academy at 
West Point, guest-lectured at 15 other universities in several 
countries, and held visiting and adjunct positions in four 
universities in China, Japan, and Singapore. He has appeared on 
many news media programs and has had numerous grants including, 
most recently, a Lectureship from the Fulbright Commission and 
an International Affairs Fellowship from the Council on Foreign 
Relations, a very distinguished panelist.
    Thank you for coming today, Mr. Wang. You have 10 minutes 
to make a statement.

 STATEMENT OF FEI-LING WANG, PROFESSOR, THE SAM NUNN SCHOOL OF 
    INTERNATIONAL AFFAIRS, GEORGIA INSTITUTE OF TECHNOLOGY, 
                          ATLANTA, GA

    Mr. Wang. Thank you. It is my pleasure to be here to appear 
before the Congressional-Executive Commission on China today to 
discuss China's hukou system. I want to thank Mr. Minzner and 
others for making this possible.
    I have prepared a written statement with the title of: 
China's Hukou System: A General Survey. So what I would like to 
do here is to use a few minutes to highlight some of the main 
points in that statement and to make some additional comments 
on implications of the hukou system, and to propose some 
personal thoughts on what can be done about this system. Then I 
will be happy to answer any questions you may have.
    Let me first emphasize that there are few other 
institutions more important than the hukou in defining and 
conditioning politics, social life, and economic development of 
the People's Republic of China [PRC]. The hukou system can be 
traced back to the fifth century B.C. at least, during the 
Warring States period. It was an important part of the Chinese 
imperial political system for more than 2,000 years.
    Both the Republic of China [ROC] and the PRC established a 
national hukou system. However, the system achieved an 
unprecedented level of uniformity, extensiveness, 
effectiveness, and rigidity since the 1950s in the PRC. 
Currently, this Chinese institution continues three crucial 
functions. It continues a politically determined resource 
allocation that clearly favors Chinese urban centers and 
discriminates against the rest of the country; it continues to 
regulate China's internal migration to exclude the majority of 
the population; finally, it continues to be a major pillar 
supporting the 
Chinese Communist Party's [CCP] one-party regime through a 
tight control of the Chinese people, especially through the so-
called management of ``the targeted people.''
    There have been noticeable reforms and changes of the 
system in the past two decades, as the Chinese reform has 
unleashed the forces of a market economy and population 
movement. Its resource allocation function has been 
considerably reduced, as the heavily subsidized urban rations 
have subsided greatly.
    The control of internal migration is now reformed, relaxed, 
and localized, giving rise to increased mobility of the 
population. Some Chinese--mainly the rich, the powerful, and 
the talented or educated--have now achieved quasi-national 
mobility under various changes in the hukou system. Yet, the 
hukou system still regulates internal migration and its 
governing principles of migration regulation remain 
fundamentally unchanged. Freedom of movement is still an ideal 
for a majority of the Chinese people.
    The hukou system's social control function, through the 
management of the so-called ``targeted people,'' however, 
remains highly centralized, rigid, and forceful. The changes in 
this area so far are mainly technical and marginal. There are 
actually efforts to enhance this role of the system in the 
2000s.
    Since the 1980s, the PRC has largely completed a national 
computerization of the hukou system. In most police stations, 
now people's hukou files can be checked and used by the police 
with computers almost instantaneously. All hotels with 50 beds 
or more are now required to transmit guest information and 
their ID photos immediately to local police stations.
    The new leadership of Hu Jintao and Wen Jiabao since 2003 
has shown signs of recognizing the negatives of the hukou 
system as a political liability. However, the reform of the 
hukou system 
remains very much unaccomplished by mid-2005.
    What to do about it? The hukou system has a complex role in 
China. The system facilitates a rapid, but very uneven, 
economic growth, creates significant social and regional 
disparities and injustice, stabilizes the PRC's socio-political 
order, and generates powerful tensions in the areas of human 
rights, equity of citizenship, and simple ethics.
    At a time when there is a widely shared belief in the rise 
of China to be a world-class power, the United States and the 
international community need to pay more attention to the 
internal structure and dynamics of the PRC. The hukou system is 
clearly one of those key institutions there that deserve our 
attention.
    To advocate, help, and facilitate the reform of the hukou 
system will help the advancement of human and civil rights for 
the majority of the Chinese people. It will also help to 
construct more internal constraints to ensure that China's rise 
will result in a democratic, stable, and free society that can 
be more likely to live in peace with the rest of the world.
    As I tried to outline in my written statement, the hukou 
system performs a host of crucial functions to Chinese economic 
development and socio-political stability. Therefore, the 
reform of the system is both highly difficult and extremely 
consequential. Ultimately, it is the job of the Chinese people 
to decide how, and how much, reform of the hukou system can be 
undertaken and accomplished. External help, however, especially 
American, is important.
    In addition to the general objectives of promoting more 
balanced market-oriented economic development, establishing 
social safety nets, striving for a rule of law and more 
transparent governance, and fair and equitable citizen rights 
for all in China, I would like to highlight just three concrete 
things that the Chinese Government can do to mitigate the 
negative consequences of the hukou system.
    First, a massive reallocation of resources is necessary, 
especially to make new investments in education, health care, 
and infrastructure in areas and regions outside of major urban 
centers. In many other countries such as Japan, this has 
happened because of a political democracy, the vote-chasing by 
national politicians. In the PRC, in the absence of a 
democracy, persuading and pressuring the central government on 
the grounds of economic and ethical rationales remain, so far, 
the only way.
    Second, a more transparent hukou system in general and the 
so-called ``targeted people'' management, in particular, should 
be encouraged and demanded. Depoliticizing the hukou system and 
gradual phasing out of discrimination against selected groups 
of people should be included in the U.S.-China dialogues on 
human rights and political reform.
    Third, a uniform national college admission policy should 
be 
implemented to ensure fairness in one of the very few open and 
competitive processes for social mobility in China. The strong 
discrimination in education opportunities based on the hukou 
system should be addressed seriously and effectively.
    China cannot become a world-class economic power without 
social and horizontal mobility and the freedom of population 
movement to ensure creativity and innovation. China cannot be 
peaceful and stable with some regions of it ranked at the level 
of Greece and Singapore, while other regions are ranked with 
Haiti and the Sudan. China's rise is unlikely to be welcomed 
when it systematically discriminates and excludes a majority of 
its own people.
    In conclusion, I believe that the PRC's hukou system now 
poses serious ethical, legal, and international questions that 
demand creative and effective solutions. The hukou system 
relies heavily on the political power of the CCP to continue, 
yet it is also highly crucial to the stability and continuation 
of the CCP political system. Ultimately, the fate of the hukou 
system will reflect and determine the fate of the current PRC's 
socio-political order and China's chance of realizing its 
enormous economic potential.
    I want to thank you again for the opportunity to share my 
understanding and thinking about China's hukou system today. I 
now look forward to your questions. Thank you.
    [The prepared statement of Mr. Wang appears in the 
appendix.]
    Mr. Dorman. Professor Wang, thank you for a very 
interesting and informative statement. I now have no doubt we 
will be able to fill 90 minutes with questions.
    I would like to introduce our next distinguished panelist. 
Chloe Froissart is a Ph.D. candidate at the Institute of 
Political Science of Paris, which is affiliated with the Center 
for International Studies and Research in Paris. She is also a 
research fellow at the French Center for Research on 
Contemporary China in Hong Kong. Ms. Froissart is an expert on 
Chinese political issues, with particular focus on internal 
migration, the development of civil society and NGOs in China, 
as well as the history of political ideas. Her dissertation 
examines the development of social movements among migrant 
workers and the citizenship of migrant workers in China, 
namely, their evolving relationship with labor laws, access to 
education, and social security. Her publications include a 
translation of the Tiananmen Papers into French, and ``The 
Hazards of the Right to An Education: A Study of the Schooling 
of Migrant Children in Chengdu'' in Chinese Perspectives. She 
has also worked as a consultant for the UNESCO program, Urban 
Poverty Alleviation Among Young Migrants in China, and has 
undertaken voluntary work for Human Rights in China, the United 
Nations Human Rights Commission, and the French NGO, Solidarity 
China. She has been regularly interviewed about Chinese issues 
by French and international media.
    Ms. Froissart, thank you very much for attending. You have 
10 minutes for an opening statement.

STATEMENT OF CHLOE FROISSART, CENTER FOR INTERNATIONAL STUDIES 
      AND RESEARCH, PARIS, FRANCE; CENTER FOR RESEARCH ON 
              CONTEMPORARY CHINA, HONG KONG, CHINA

    Ms.  Froissart. Thank you very much. I would like to begin 
today by expressing my sincere thanks to the Members of the 
Congressional-Executive Commission on China for the invitation. 
I am especially grateful to Carl Minzner for the help in 
arranging my visit.
    I would like to take the example of migrant children's 
access to education to illustrate the institutional exclusion 
created by the hukou system, as described by Professor Wang. My 
presentation will mainly draw on the field work I have been 
carrying out for four years in Chengdu, the capital of Sichuan 
province.
    I will first recall the impact of the hukou system on 
migrant children's access to education as it appeared at the 
beginning of the century, and is still prevalent now. But as 
education is a determining factor in a country's development 
and involves individuals' rights as much as state interests, 
there has been room for many recent improvements. I will thus 
give an overview of these developments, as well as the forces 
at stake in the evolution process, and I will finally endeavor 
to weigh the impact of the reforms.
    Let us begin with the impact of the hukou system on migrant 
children's access to education. Despite the fact that China 
recognized in its Constitution the right of every citizen to 
receive an education, the hukou system still prevails over the 
legislation and prevents migrant workers' children from 
receiving a proper education. According to the system, local 
governments guarantee the education of children only for their 
own constituents, allocating resources according to the number 
of permanent residents. Migrant children were completely 
excluded from the urban education system until 1998, when they 
gained the right to enroll temporarily in urban schools on the 
condition of being registered with a host of administrative 
organs and paying ``Temporary Enrollment Taxes'' that can reach 
several thousand yuan a year. As the vast majority of the 
migrants are illegal immigrants who cannot afford such high 
schooling fees, private schools sprang up in response to the 
needs of these children in the major urban centers in the mid-
1990s.
    But due to very low enrollment fees, pupils had to put up 
with deplorable sanitary, security, and teaching conditions. 
Most of these substandard schools have no legal status and they 
cannot award certificates for courses completed. They are also 
frequently banned and demolished without the authorities 
worrying about placing the children in other schools.
    These problems triggered a public outcry, supported by 
scholars, journalists, and also some political figures and 
organizations. Chinese authorities were particularly receptive 
to this public outcry because of the rising number of migrant 
children in the cities. There are now an estimated 7 million, 
up from 2 to 3 million in 1996. This large increase explains 
the evolution of the central government's policy.
    We can distinguish three historical steps. First, from 1998 
to 2002, the Chinese state acknowledged the problem of migrant 
children's schooling and opened the doors of public schools to 
them, but set very high administrative and economic conditions 
on their enrollment. The second step began in January 2003, 
when urban governments were held responsible for providing 
compulsory education to school-aged migrant children, mainly by 
accommodating them in public schools. Urban governments were 
also required to support private schools by helping them to 
improve their material and teaching conditions instead of 
eliminating them. Finally, Prime Minister Wen Jiabao put 
migrant children's access to education on the top of the agenda 
of the NPC annual session in March 2004. One of the most 
important decisions of this session was to announce the 
suppression of temporary enrollment fees in September 2004.
    I will now look at how the central policy is enforced at 
the local level, by taking the case of Chengdu municipality. 
Chengdu municipality followed quite well the central guidelines 
and this is due to the favorable political climate in the 
Sichuan capital. I will leave the details at this point for the 
discussion period. There are always discrepancies between 
general and ideal principles devised by the central government 
and local implementation of these principles. As we will see, 
new public policies in China do not aim to accommodate all the 
children equally. As the fault line between urban and migrant 
children is still maintained, a new tiered management of 
different kinds of migrant children also appeared.
    I will consider how Chengdu municipality implemented the 
three central government guidelines of enrolling migrant 
children in public schools, suppressing temporary enrollment 
fees, and enhancing the management of private schools. 
Regarding enrollment of children in state schools, in December 
2003, the Chengdu government announced that a public school for 
migrant children would be opened in each of the five urban 
districts within two years, and that the municipality will 
invest a great amount of money to finance these schools. In 
fact, however, public schools were opened in only two 
districts, where there were high concentrations of migrant 
children.
    Thanks to public investments, enrollment fees in these 
schools are very low, ranging from 300 to 500 yuan a semester. 
Teachers are transferred from urban public schools and teaching 
and security conditions meet urban standards, but material 
conditions are of a lower standard than the ones in the schools 
for urban children. Very few children can enroll in these 
schools, because current enrollment is subject to the condition 
of having three certificates, namely, hukou booklets, temporary 
residence permits, and a work contract for one of the parents. 
A tax bill is also sometimes 
required.
    What about the suppression of temporary enrollment fees? 
Beginning in September 2004, Chengdu municipality exempted some 
children from paying temporary enrollment fees, but under very 
stringent conditions. The three documents I've just mentioned 
are required, and the parents have to be registered with the 
Labor and Social Security Administration, which means that they 
have to contribute to social security. They also have to pay 
taxes. These conditions are often too difficult for migrant 
workers. That is why this policy, in fact, benefited white-
collar workers from other cities, and the wealthier and more 
stable among the migrant elite.
    Because public education still remains beyond the reach of 
migrant children, the vast majority of them are enrolled in 
private schools that number 70 now, up from 10 two years ago. 
In September 2004, the Chengdu government announced that it 
would support these schools, but in fact very few were 
legalized. At the beginning of 2004, only five schools had a 
permit, and there are now fewer than 10. A good indicator of 
the lack of public commitment toward these schools is that 
Chengdu municipality has still not issued directives about to 
which government office private schools for migrant children 
should apply to obtain permits.
    I will now try to assess the impact of the reform and its 
limits. Public policies that favor migrant children's access to 
education do not eradicate the impact of the hukou system, but 
enable a more flexible management of this system. This policy, 
first, benefits the children of the wealthier, most stable, and 
legally registered ``outsiders.'' Chinese rural migrants are 
treated in their own country in a way similar to how foreign 
immigrants in the United States are treated--they can obtain a 
``green card'' according to their merits. Public policies in 
favor of migrant children's schooling thus function as a tool 
to filter this population and control urbanization by 
deliberately excluding the poorest and transients.
    Another noteworthy consequence of this reform is that it 
creates a tiered management of the migrant population. We can 
now distinguish five categories of children with different 
access to education: (1) those who are integrated in urban 
schools because their parents can afford to pay the Temporary 
Enrollment Fees; (2) those who are integrated in urban schools 
because they were exempted from paying these fees; and (3) 
those who are enrolled in substandard public schools; (4) those 
who are enrolled in licensed private schools; and (5) the vast 
majority, those who are enrolled in illegal, substandard 
private schools. These are children of poor illegal immigrants 
and pay a higher schooling fee and do not receive a proper 
education.
    This typology clearly illustrates one of the key points 
made by Professor Wang in his book: institutionalized 
discrimination anchored in the hukou system remains while now 
being coupled with discrimination between the haves and the 
have-nots.
    So a lot of progress has been made in only two years, and 
more children who are not urban residents can now receive an 
education. However, the issue is still exposed to institutional 
blockages and will not be solved without both political and 
administrative reforms, namely the abolition of the hukou 
system, followed by corresponding taxation and institutional 
reforms.
    So given its actual administrative system and limited 
financial resources, the Chinese Government must take the 
following practical steps to address the discriminatory 
treatment faced by migrant children: First, to allow the 
existence of private schools for migrant children and subject 
them to state monitoring in order to help them meet the same 
standards of those available in state schools, and to prevent 
them from becoming mercantile. Second, to recentralize 
education expenditures in addition to substantially increasing 
resources for education.
    I would like to finish with a special warning. One of the 
reasons stated by authorities for putting migrant children into 
special classes or ``simplified schools,'' which are generally 
of lower quality, is that the children have not achieved the 
same academic standard of their urban counterparts. Such a 
reason should not be used as a means to discriminate against 
migrant children. These special schools or classes sometimes 
are a way to adapt teaching to the needs of the students; 
however, they also continue segregation against them and 
encourage further popular discrimination.
    Thank you very much.
    [The prepared statement of Ms. Froissart appears in the 
appendix.]
    Mr. Dorman. Good. Thank you.
    I will begin the questioning and then invite each of the 
staff in turn to join the questioning. Each of us will have 
five minutes to ask a question and hear an answer. We will 
continue asking questions and hearing answers until we run out 
of time or run out of questions. Again, thank you both for very 
interesting and useful testimony.
    I wonder if I could pose a question to both of you 
regarding the hukou reform process itself. Both of you have 
described a series of reforms over the past 10 years, or 
perhaps longer than that. To what extent is the discriminatory 
treatment against migrants, which you have described to us in 
your opening statements, an unintended outcome of hukou reform? 
Where does the government, at the central and local levels, 
stand on this? Is it your view that continuing reform will 
improve the treatment of migrants, or were these reforms 
designed to discriminate against migrants? One problem for many 
of us in understanding the hukou system is that it is sometimes 
unclear whether the reform policy outcomes were intentional. 
Could both of you address this question, please? Thank you.
    Ms.  Froissart. Some of the reforms intentionally create a 
tiered management of the population. For example, in Beijing 
and other big cities, you have a list of jobs that migrant 
workers cannot do. In the capital, migrants are listed into 
different types--A, B, C. Each category corresponds to a 
certain kind of permit that lets you have access to certain 
kinds of jobs and to certain kinds of public services. This is 
obviously a deliberate way of implementing a tiered management 
of the population.
    But for other public policies such as the reform in 
education, and the reform of social security, I do not think 
that the main objective of the Chinese Government was to create 
different kinds of stages. It is a consequence of these 
policies, but I do not think it was the main aim of the Chinese 
authorities. What is certain is that the Chinese authorities 
tried to find a way to spend the least possible amount of money 
and to accommodate the people that they want to see in the 
cities, the talented, the educated, and the wealthiest people. 
They designed public policies according to this aim. 
Diversification of the stages among the social category of the 
migrant people is a subsequent consequence of these policies.
    Mr. Dorman. Good. Thank you. Professor Wang.
    Mr. Wang. This actually is a very key question to allow us 
to try to understand what is going on in China in terms of 
reform. My understanding is that the reform process of the 
hukou system, similar to the overall reform process of China's 
economy in the past two and a half decades, is a combination of 
intended policies and unintended consequences by spontaneous 
activities or various actions of individuals in China.
    The Chinese Government clearly intends to maintain the 
hukou system. I do not see any intention at all to abolish it, 
or even weaken it. But the unintended consequences of market-
oriented economic reform have built up so much pressure that 
lots of changes have been forced on the hukou system. In that 
sense, much of the reform of the hukou system is a response, a 
reaction by the government to what has happened in the field 
rather than a designed, clear policy.
    The latest round of reform that was started in 2001 is 
called ``deep reform.'' That was designed, indeed, by the 
government, but clearly as a response to what is happening in 
the Chinese political economy. The consequence of the reform 
has been mixed, unfortunately, disadvantaging those who are 
discriminated against, those who are excluded. In other words, 
the life chances of those who were discriminated against have 
not really improved significantly under the reform of the hukou 
system, not necessarily because the hukou reform hurt them 
more, but because there are new things that are also happening 
at the same time.
    There are two things I want to mention. One is advancement 
of the market system and the importance of money in China that 
makes people's livelihood much more dependent upon the material 
means they have. The new market system, plus the hukou system, 
make the poor, and also the excluded, at the same time, become 
synonymous. In other words, being poor and being excluded 
becomes synonymous: if you are excluded, you are also poor; if 
you are poor, you are also excluded.
    Second, the reform of the Chinese economy in the past two 
and a half decades has led to the general decay of the social 
welfare system. The social security network is gone. The public 
health care system under Mao Zedong, which was rudimentary, 
elementary, but nonetheless quite widespread, now is largely 
gone. So, therefore, those excluded people are having an even 
harder time getting by, especially in terms of meeting some 
basic needs such as health care and education.
    So it is a combination of various factors, but I would not 
say right now that hukou reform has fundamentally changed the 
life chances of the excluded.
    Mr. Dorman. Good. Thank you.
    I would like to pass the microphone now to my colleague, 
John Foarde, who is Staff Director for our co-chairman, 
Representative Jim Leach.
    John.
    Mr. Foarde. Thank you, Dave. Thanks to both of our 
panelists for coming such a long way to share your expertise 
with us.
    I know that you know, because you watch the news, that 
Americans are riveted by the calamity that has just hit the 
southern United States, and particularly the city of New 
Orleans. As I was reading your statement and thinking about 
these issues, I thought that we are in the process of moving a 
very large number of people from the affected areas to 
temporary or permanent homes elsewhere. Americans just 
understand that moving somewhere else in the United States is 
natural, that being able to pick up and go elsewhere is your 
right, but it is also relatively easy. If you should decide to 
establish a new residence somewhere else for tax purposes or 
for other purposes, there are certain procedures that you have 
to follow for the government, but you do not carry around a 
little residence permit book, and your ability to get social 
services, to have your children educated, by and large, does 
not depend on having household registration. So this American 
experience made me wonder, what happens in China and how does 
the hukou system come into play when there are natural 
disasters that require the evacuation of many dozens, many 
hundreds, or even many thousands, of people?
    Is it possible, for example, under the hukou system as it 
exists today, for people to change their residence if they have 
been moved because of a natural disaster, or do people who have 
to move, refugees, in that sense, or evacuees, have the same 
sorts of difficulties that economic migrants have in China? If 
either of you have views, I would love to hear them. Thank you.
    Mr. Wang. All right. Let me take the first crack at this. I 
think there are two kinds of movement of population in China 
under the hukou system. The one kind is the one that is 
authorized by the government, approved by the government, or 
sometimes ordered by government. That kind of relocation has 
happened all the time during the history of the PRC, since the 
1950s.
    The ``Third Front'' strategy, the ``send-down'' campaigns, 
and the reallocation population in case of huge projects, such 
as the Three Gorges Dam, and also the relocated refugees as a 
result of disasters. That is accommodated by the hukou system. 
The government just reassigns you to a different location.
    The other kind is an unapproved, spontaneous kind of 
migration by the people themselves. In this case, if you do not 
get permission, and you do not have authorization, you are 
considered illegal and you will be always treated as, at best, 
a temporary resident in a new place that you are in right now. 
By being categorized as a temporary resident, you do not have 
the full membership of a local resident, you do not have full 
access to local social services, education, health care, and 
job opportunities. As has been mentioned by Ms. Froissart, in 
some cities, certain jobs are simply declared not available to 
outsiders. So this kind of unauthorized migration, 
unfortunately for the Chinese Government, is taking place on a 
massive scale right now. It is estimated to be in the 
neighborhood of over 100 million people that are unauthorized, 
moving around. Some have lived in a different city for two 
decades, and yet still are considered a temporary resident, at 
best. Some simply are illegals. Those illegals, of course, are 
subject to harassment and repatriation by police. Only 
recently, starting in 2004, they started to change and relax 
the Repatriation Law a little bit.
    So now if you are not causing any trouble in major cities, 
you can hang around for a while without papers. But if you 
cause any trouble, like begging or harassing tourists, 
whatever, you are still subject to repatriation, or what they 
call a ``Helping Hand'' from the state for those ``blind 
migrants,'' as they say.
    In terms of disasters, I would argue, actually, the hukou 
has really worked in many ways to allow for a fairly orderly 
relocation of refugees and the people who are migrating. For 
example, over a million people in the Three Gorges area have 
been relocated all over the country. Many of them have been 
sent as far away as Xinjiang province, a far away place, to 
become permanent residents in that area so as to make a place 
for the big reservoir that is almost finished right now.
    So the hukou system is a very useful, functional, and 
administrative tool, but it fundamentally hinders spontaneous 
migration by the Chinese people.
    Mr. Foarde. Ms. Froissart, if you have a comment, fine. If 
not, we can go on.
    Ms.  Froissart. About management of disasters, I think 
Professor Wang said everything.
    Mr. Dorman. I would like to turn the questioning over to 
Carl Minzner, who is a Senior Counsel on the Commission. Again, 
thanks to Carl for organizing this roundtable.
    Mr. Minzner. Thank you, both, to Fei-Ling and to Chloe for 
coming so far to participate in our roundtable.
    Let me ask you a question related to an observation both of 
you made, that over the past 20 years or so, economic 
privatization has weakened many of the core aspects of the 
hukou system. In the 1960s and 1970s, hukou registration was 
linked to food rations. Of course, when it is linked to food 
rations, you really do not have that much opportunity to move. 
Nowadays, economic privatization has removed many of the links 
between hukou identification and allocation of resources, 
although not yet services. Is it plausible, as we are looking 
forward, to think that the importance of the hukou system will 
simply be eroded by economic development? Is it possible that, 
in the field of education, or in other fields, that as China 
moves toward a more market-based system, the hukou system just 
will not be that important? To phrase the question a little 
more broadly, why should we be concerned about the hukou system 
on a long-term basis?
    Ms.  Froissart. It is true that economic privatization 
eroded the hukou system. Market forces now allocate some goods 
like food or accommodation that were previously 
administratively allocated. This enabled people to move more 
freely.
    The introduction of a market economy also created an appeal 
in urban areas for migrant workers, and that is why migration 
is now tolerated. However, there is still no free movement in 
China because of the high social and economic costs that 
migrating implies.
    As urban public services are becoming privatized, there is 
an equalization of treatment between migrants and urban 
dwellers concerning their social rights. The difference of 
treatment between the wealthiest migrants coming from other 
cities and the urban elite is no longer so obvious as both are 
more likely to send their children to private schools or to 
subscribe to private insurance schemes that they deem of better 
quality than state schools or public social security. Hence, 
few rich migrants still care about obtaining an urban hukou. 
But discrimination between urban dwellers and migrants is more 
striking concerning poor people, as the Chinese state still 
pays for a minimum social insurance net to support unemployed, 
handicapped, or poor urban dwellers and from which migrants are 
excluded.
    I would like to make clear, it is very important, that a 
market economy does not necessarily lead to the development of 
citizenship, and economic privatization alone is not a 
sufficient force to replace a residency system with a 
citizenship system. It needs both bold administrative and 
political reforms.
    On the contrary, the development of a market economy, as I 
tried to illustrate in my presentation, leads to 
diversification of the stages among citizens. So we are going 
toward a development that is contrary to the principle that 
every citizen should have the same rights and same duties.
    Why should we care about this issue? Because the situation 
is ethically worrying and puts China in contravention of the 
international covenants that it has signed, such as the United 
Nations Convention on The Rights of the Child or the 
International Covenant on Economic, Social, and Cultural 
Rights, for example. We should also care about this issue 
because it can potentially generate social instability and 
economic blockages.
    The deepening of market-oriented reforms has an impact on 
people's mobility. When people move, they are supposed to have 
personal rights, which implies that those rights are not linked 
any more to the place where they are working or the place they 
are registered.
    The deepening of social and economic contradictions can 
push Chinese authorities to further reform the hukou system. 
For example, the Pearl River Delta, which is the region that 
employs the most migrant workers from all over China, has been 
suffering for two years from a lack of workforce. Fewer and 
fewer migrant workers are willing to go to Guangdong province 
because working and living conditions are not improving and are 
even deteriorating. Migrants are now moving to other places 
like the Yangtze Delta or to large cities closer to their 
residence.
    In order to tackle this problem, the Guangdong authorities 
have already taken some measures that are slowly improving 
migrant workers' rights. Chinese authorities might also want to 
further 
reform the hukou system in order to curb growing social 
contradictions, as we now see more and more social movements 
among 
migrant workers.
    Mr. Wang. In addition to what Chloe has already said very 
well, I would like to add a few points. I think, Chloe, you are 
absolutely right. The hukou system has been weakened by the 
reforms, and also by spontaneous migration of a hundred million 
people. There is great pressure to change it. Indeed, it has 
become less important in terms of allocated resources, 
especially in terms of rationing, as Chloe also mentioned, 
urban rationing of food and consumer goods.
    But why are we concerned about it? Why do we still worry 
about it? I think, a couple of things. One, the hukou system, I 
think, is fundamentally a Chinese characteristic, if you will, 
that allows us to see the nature and the future of the rise of 
Chinese power.
    Personally, I think the hukou system fundamentally limits 
Chinese creativity and innovation. Without that kind of 
innovation and creativity, China can hardly become a world-
class power. So, therefore, the hukou system actually serves as 
kind of a fundamental check on how much power China can really 
amass, beyond being just a processing factory for the world. 
Because without economic mobility, without a kind of freedom of 
movement, a society cannot be very innovative.
    The second reason why it is so important is that I think 
the hukou system has a lot to do with the future political 
development of China. Whether the Chinese can have kind of a 
transparent governance, that is, rule of law, and also possibly 
a democracy, has a lot to do with the fate of the hukou system.
    As Chloe has already mentioned, under the hukou system the 
Chinese people do not have equal citizens' rights, let alone 
equal political rights or human rights. Third, I think the 
hukou system deserves our attention because it represents the 
kind of values and ideals that may not allow for a peaceful co-
existence between China as a world-class economic power and the 
United States, because it may lay the groundwork for conflicts 
of ideas and values. I do not think it will be easy for the 
world to accept Chinese leadership when the government there 
has this system that systematically excludes people and 
categorizes and rates them according to where they are 
administratively. That is a challenge of values and ideals that 
may not be that tangible, but on the intangible level it is 
going to be very consequential and deserves the attention of 
decisionmakers outside of China.
    On the ground in China, I think the hukou system is not 
disappearing, rather only transforming and changing the way it 
functions. I see a combination now of two kinds of exclusions 
in China. One kind is still based on the hukou system, where 
you are, 
because you are from provinces versus coastal areas, from urban 
centers versus the countryside. The other kind of 
discrimination is based on what you have, money, material 
wealth. So it is a combination. Therefore, in China you have a 
new social stratification that has emerged. You have a small 
elite living in urban areas that monopolize just about 
everything in China, including political power, economic 
resources, access, opportunity, and so forth. The majority that 
lives in the countryside or outside of major urban centers has 
lost out completely in all areas. That kind of system, in a 
country that is growing so fast and has so much potential to be 
a world leader, is posing serious questions to other countries 
to think about: ``What does it mean to us? ''
    Mr. Dorman. Good. Next, we will turn the questioning over 
to William Farris, who is a Senior Counsel on the Commission.
    William.
    Mr. Farris. Thank you. I follow freedom of expression 
issues for the Commission, and I would be curious to hear your 
thoughts about how the hukou reforms, the hukou situation, and 
various migrant issues are portrayed in the Chinese state-run 
media, if you have any experience with that. I would be 
particularly interested in hearing if you are aware of any 
dissenting voices or voices in the news media that try to speak 
on behalf of the migrants or the victims of issues raised by 
the hukou system, or if the media is primarily focused on 
simply echoing what the government policies are and what the 
government stances are with respect to these issues. Thanks.
    Mr. Wang. In general, I think the Chinese media, by and 
large, is still controlled or is strongly influenced by the 
government. So, in general, the Chinese media is basically 
echoing what the central government is saying about the hukou 
system. So when they launched the reform in 2001, or slightly 
earlier, starting in 1998, 1999, and 2001, you see widespread 
media coverage about the alleged disadvantages or problems of 
the hukou system, primarily based on personal stories of how 
the hukou system limits mobility, strangles innovation, causes 
personal hardships and suffering, and so on. You do see that 
kind of coverage. But I suspect that was primarily echoing the 
reform. With reform, now the decision has been made, so let us 
talk about the nasty side of it.
    But it is quite interesting that the Chinese news media, so 
far, has rarely talked about some very important aspects of the 
hukou system--for example, management of targeted people--the 
subjects have never been mentioned by the news media. Why? 
Because of decisions made at the top that this aspect of the 
hukou system shall remain internal, not for public discussion. 
The Chinese policemen actually are forbidden from talking about 
this function in public, pretty much because they know this 
does not fit into the general public image they want to have.
    In terms of how much hukou is covered or discussed in the 
Chinese media or by the Chinese public, as I have noticed, the 
urban people, the privileged Chinese citizens, really do not 
want to talk too much about the hukou system, although they are 
all aware that the system is very important. If you interview 
urban residents these days, chances are they will say, ``Oh, 
no, this system is not important. We are not even aware of 
that. It has become less and less important right now.'' But 
then if you talk to the migrants, talk to the rural people, or 
talk to the people who live in smaller cities, remote areas who 
want to come to the bigger cities and could not, then they will 
tell you there is still a mighty presence of hukou and it is 
still a very important thing, and they have many personal 
stories to tell you.
    Now, one exception to the general rule is that, on the 
Internet, in cyberspace, you do see some severe criticisms of 
the hukou system occasionally posted, before they were yanked 
off the Internet by the watchdogs working for the government. 
Sometimes we do have a glimpse of the kind of grievances that 
are out there, and they are pretty strong. Let me give you one 
recent example. There was a bus accident in Shanxi province 
that led to the death of many passengers, some of them urban 
hukou holders, some of them rural hukou holders. The insurance 
company paid compensation to the families for wrongful death, 
and they said, according to government policies, the victim who 
had the urban hukou would get twice to three times as much 
compensation than the rural ones. Then there was a very strong 
Internet posting attacking this decision, equating it to racial 
discrimination, equating it very strongly to India's caste 
system. How long did that posting last on the Internet? Very 
briefly, but it was posted for a time. So, therefore, you do 
see the strong grievances, but they do not get fully expressed 
at all.
    The hukou system, finally, is one of those really taboo 
issues in the PRC. There are a few things in China that you do 
not touch. The Tiananmen event of June 4, 1989, is a taboo 
subject, and bad things about top leaders is also taboo, and 
hukou is also taboo, unless there is an orchestrated need to 
say, ``all right, we are going to reform now, let us talk about 
this a little bit.''
    Before China joined the WTO, there was an orchestrated 
discussion about the hukou system for a particular reason, 
because with national treatment under WTO, everybody should 
have equal treatment, and there was discussion about the 
current inequities. Other than that, this issue is something 
urban elites would rather not talk about, or they are 
instructed not to talk about. So it is clearly an 
underexplored, underdiscussed issue in China, although 
everybody is aware of its heaviness, of its relevance, and also 
of its consequence.
    Ms.  Froissart. Since the Chinese Government decided to 
accelerate the hukou reform in 2001, there has been wide 
criticism about the system in the official media and among 
Chinese academics.
    The main critics are that, first, the hukou system is 
undermining the economic efficiency and is an obstacle to the 
rational allocation of the workforce. Second, it hinders 
administrative efficiency, since it is too much of a headache 
for the urban administration to deal with all the permits and 
all the illegal immigrants.
    Third, another reason why the hukou is criticized is that 
it nurtures the socio-economic imbalance between rural and 
urban areas, between big cities and small cities, as well as 
between coastal and internal regions.
    Since the 16th Congress of the CCP in 2002, addressing 
these imbalances became one of the national priorities. This 
new political orientation gave further incentives to critics of 
the hukou system.
    The last reason why the hukou system is criticized is that 
Chinese authorities are increasingly referring to ``gongmin 
daiyu,'' which means ``national treatment'' or ``equal 
treatment among citizens.''
    We should not take too seriously the Chinese Government's 
intention to grant true citizenship to all Chinese people. 
Chinese authorities also repeated many times that they would 
not eradicate the hukou system in the near future.
    To be a bit provocative, one could say that the Chinese 
Government has now learned how to use the politically correct 
language of globalization. We can see now more and more 
references to values such as ``citizen,'' ``citizenship,'' or 
``civil society,'' and ``legal rights,'' in media outlets as 
the Chinese Government is now referring to these concepts to 
justify some of the reforms. Namely, in 2003, the National 
People's Congress Committee passed a bill that changed the name 
of the ``residency identity card'' to ``citizenship identity 
card.''
    The government justified this change by the fact that ``the 
concept of residence linked to the private ID card is not 
constitutional, it simply refers to the residence, whereas, 
citizens are individuals with constitutional rights.'' It was 
quoted in China News Daily, November 2002. Article 33 of the 
Chinese Constitution indeed provides that all citizens of the 
PRC are equal before the law.
    So what is interesting now is that China's government is 
playing a kind of game with the international community and 
with its own people by using this new language of 
globalization, publishing white papers on human rights, 
amending the Constitution, and waging political campaigns to 
foster the rule of law.
    This is also a strategy to buy some time domestically and 
improve state legitimacy in the eyes of the public. Recently, 
populist tactics of the central government have had quite a 
strong symbolic impact on migrant workers, who were first 
thankful to the government for acknowledging their rights as 
citizens. However, those who found that those governmental 
statements made little change in their daily life are prone to 
lose their faith in the State's ability to protect their 
rights. The Chinese Government is playing quite a dangerous 
game because it gives new legitimate bargaining tools to 
society and cannot control how people interpret these values 
and how they try to mobilize them.
    There is now an increasing number of chat rooms on the 
Internet where people, especially migrants, directly call into 
question the hukou system in the name of ``citizenship.'' For 
example, they say that the system is in contradiction with 
international covenants signed by China, or with the 
government's pledge to protect their legal rights, or with 
social equity as they pay taxes just as urban dwellers.
    Mr. Wang. Could I add a couple of points?
    Mr. Dorman. Sure. Yes.
    Mr. Wang. Thank you. One, I would like to echo what Chloe 
has mentioned. There has been a sophistication, an improvement 
in the Chinese news media, or, if you will, the Chinese 
propaganda machine, improvements that use modern language and 
new terms to at least portray a cosmetic change of the hukou 
system. For example, the difference between a ``residence ID 
card'' versus a ``citizenship ID card.'' In Shanghai, for 
example, they have just launched a campaign to take away the 
distinction that used to be on hukou papers saying you are a 
rural or urban resident. They took it away and said, ``You are 
all residents.'' But that does not really mean that the system 
is gone, it just means that it is less intrusive, less ugly. 
For example, on the personal ID card, sometimes you cannot tell 
whether somebody is from a rural or urban area any more. The 
signs are gone. But by looking at the address, you can clearly 
tell, ``All right, this person must be from the countryside, 
this person must be from a city,'' and so forth. So the 
sophistication and improvement of propaganda and news media 
coverage in China, in general, and on the hukou system in 
particular, is clearly there.
    I would suggest that this fact actually opens an 
opportunity for the United States to work on the issue, as long 
as they accept the terminology. Pretty soon, we could be 
forcing a lot of substance into this as well.
    So, I would make another point here, Mr. Farris. You 
probably will want to use the hukou system as an indicator to 
see how much the Chinese news media is opening up and how much 
freedom of expression is developing in China by seeing how 
honest, how open, and how much the hukou system is being 
discussed, and how much the media is allowed to do that, and if 
there is any legislative effort in the National People's 
Congress to pass, finally, a revised hukou law. Because, 
believe it or not, hukou is so important, but it is not in the 
Constitution. It is not in the civil code. There is no law 
about it. It is almost purely an administrative system based on 
only two regulations, one passed in 1959 regarding hukou 
registration, the other one, I believe, in the mid-1980s 
regarding personal identification cards. There is no 
fundamental hukou law. So if the hukou law is passed, then 
efforts to make this system more transparent might make great 
progress. The proposal has been raised by some deputies of the 
National People's Congress since the 1990s. Almost every March 
someone was talking about it. But there is no effort at all to 
make that a law. If they make a hukou law, this would make it 
much more transparent and easy to follow. If they were to adopt 
modern legal language more in making that law, especially about 
its implementation, it would be a great opportunity for the 
international community to say, ``Look, these are probably the 
things you ought to do.'' It would also be a great indicator 
for Chinese freedom of expression. Thank you.
    Ms.  Froissart. May I add something?
    Mr. Dorman. Sure.
    Ms.  Froissart. I would just like to mention that the 
Chinese power is not monolithic. There are reformers who truly 
back bold reform of the hukou system and whose voices are more 
publicized, and there are also conservative people who seem to 
be more powerful.
    For example, at the beginning of 2005, Chinese media 
announced that Beijing's Municipal Congress would abolish 
discrimination against migrant workers in the capital, namely 
allowing them to access employment on equal footing with urban 
dwellers. In fact, a counter proposition was also made at the 
Municipal Congress that apparently won its favor and no 
significant changes have taken place since then.
    Conservative people seem to be more numerous and more 
powerful at the moment, especially because they are backed by 
important state organs and ministries, such as the Ministry of 
Public Security.
    The Ministry of Public Security is against any significant 
reform of the hukou because this system still plays an 
important role in managing and controlling the society. But 
there are other departments, such as the Ministry of 
Agriculture, that support this reform because it will benefit 
rural areas. Divisions can also be found inside the same 
ministry, as some officials support the reform and others are 
against it.
    Mr. Farris. Good. Thank you.
    Mr. Dorman. I would next like to recognize Commission 
Special Advisor, Dr. Kate Kaup. Kate.
    Ms. Kaup. Thank you. There seem to be some important 
inconsistencies in exactly who has the authority to set hukou 
policy in the ethnic autonomous areas. Article 43 of the 
Regional Ethnic Autonomy Law states that ``autonomous 
governments have the right to control transient or migrant 
populations.'' But the State Council issued Implementing 
Regulations this May that specifically require autonomous 
governments to ``give preferential and convenient working and 
living conditions'' to those who have come from outside of an 
autonomous area to work or establish businesses. Moreover, 
Article 29 of these Regulations mandates that autonomous 
governments should ``give appropriate consideration in terms of 
employment and schooling to families and children of 
professionals of Han nationalities and other nationalities who 
go to work in national autonomous areas in remote areas and 
frigid zones where conditions are relatively harsh.''
    It is interesting to compare hukou policy in autonomous 
areas versus in non-autonomous areas. It seems that in non-
autonomous areas, hukou policy favors local residents and 
discriminates against migrants, whereas in autonomous areas, 
the outside migrants are actually given preferential treatment 
at the expense of the local residents.
    So I am wondering if you could comment on two questions. 
First, to what extent does hukou policy differ in minority 
areas and 
non-minority areas? The second, and longer, question is who is 
determining hukou policy in autonomous areas? Is it the local 
government or central authorities? Specifically, which 
ministries are responsible for implementing core hukou policy 
decisions?
    Mr. Wang. Well, very briefly, I will try to answer the 
second question first, and then I will take the first question. 
They are difficult questions.
    Who is making the decisions regarding the hukou system? 
According to the regulation about household registration that 
was passed in 1959, and thus actually the only legal basis, the 
sole legal condition underpinning what was supposed to be just 
an administrative regulation but now has become a sole legal 
condition underpinning the whole system, the Ministry of Public 
Security or the police are the administrators of the system. 
But in practice, the Ministry of Public Security has become the 
decisionmaker as well, in order to change and fine-tune the 
system. So almost all of the major changes, overhauls, and 
adjustments of the system, if you look at the record over all 
these years, have always been initiated either by the Ministry 
of Public Security or have been asked for by the Politburo, 
which directed the Ministry to work up a plan and resubmit. In 
other words, it has always come from the Ministry of Public 
Security. Very rarely do you see some changes initiated by some 
other organ of the government, such as the State Planning 
Commission, or others. Thus, the Ministry of Public Security, 
or the police, basically is the authority for making changes 
and running that system.
    In that sense, the hukou system is actually one of very few 
systems in the PRC that are nationally uniform, if you will. 
But as I alluded to in my oral statement, recently the function 
of the hukou system in regulating domestic migration has become 
fairly localized, in the sense that the so-called entry 
conditions, that is, who can get into big cities, now varies 
from province to province, from city to city. It is subject to 
local decisionmakers, primarily local police departments, 
Public Security bureaus, and local Party commissions and local 
governments. But the principles are still being determined and 
decided by the central government in Beijing. So it is 
nationally uniform.
    This is actually one of the few systems that is truly 
nationally equal in the sense that Mr. Hu Jintao himself, the 
president of the PRC, and from him all the way down to prison 
inmates, all have hukou somewhere, all have files kept 
somewhere. Although, if you are a deputy minister of the 
cabinet or higher, your hukou files are secret. People cannot 
access your files without special permission. If you are lower 
than that, your hukou file is open to all law enforcement 
agents. If you have good connections or if you bribe the right 
people, you can have access to many people's hukou files, but 
access to the ministers' hukou files is a different story.
    So, in the sense of decisionmaking and also running the 
system, it is uniform nationally. The Ministry of Public 
Security and the police are in charge.
    In minority areas, I actually only visited the Tibet--
Xizang--Autonomous Region and the Xinjiang Uighur Autonomous 
Region 
before, but in Tibet I did not have much time to explore this 
particular issue. But in Xinjiang, I did ask around about who 
is managing this thing and who is doing that. Clearly, it is 
also the 
Bureau of Public Security. All hukou-related posters and public 

announcements were signed by the Bureau of Public Security, 
sometimes jointly with the Bureau of Labor and the minzhengju, 
the Bureau of Civil Affairs. But usually it is Public Security. 
So I would say the local governments in minority regions, in 
ethnic regions like Xinjiang, Guangxi, Inner Mongolia, or 
Tibet, really do not have too much power beyond that which is 
assigned to local provincial governments. So in that sense, the 
ethnic autonomy does not really have too much impact on the 
making of decisions or the implementation of the hukou system 
in minority areas.
    Now, as to the first question you asked, how different, 
there are some provincial treatments authorized by the central 
government in the minority areas regarding hukou. For example, 
when we talk about discrimination, if you look at the college 
admission system in China, it is quite interesting. You see a 
clear preference given to urban residents in major urban 
centers such as Shanghai, Beijing, and Chongqing, Tianjin--all 
those areas. But another area that is also heavily favored is 
Tibet. So you have had Tibet residents, especially Tibetans, 
that enjoy preferential treatment, too. So believe it or not, 
sometimes you hear anecdotal stories, kind of funny stories how 
people will artificially change their hukou registration to be 
from Tibet so they have a better chance to get into good 
colleges. So in that sense, there is some kind of preferential 
treatment in minority areas.
    But beyond that, I think the mechanism, the process, the 
functions and the administration of the hukou system in 
minority areas is not too much different from Han areas, from 
the so-called ``China proper,'' the Han majority regions. I say 
that with some evidence--not complete evidence--because this 
system is still semi-secret, you know. All this data is not 
available to the outside. But there are published accounts 
about the Chinese authorities fighting against Muslim cells of 
terrorists or East Turkestan, pro-independence groups in 
Xinjiang, Muslim groups who are fighting for independence. By 
reading these brief accounts, and there are new stories 
published in the report, you clearly see the police in Xinjiang 
also use hukou files in the same fashion. They also will enter 
the houses of the suspects, and also mosques, in the name of 
``checking'' hukou information. The Chinese police are 
authorized to go to civilians' homes without a warrant, without 
court approval, without anything, to do what they call 
``verification'' of hukou information. You read these reports 
and you see they use this very effectively in Xinjiang to fight 
the separatists by saying, ``Oh, we are going to check your 
hukou information and see how many people are in your household 
now,'' and they check the books. They use it very effectively 
for detective work to find out about terrorist activities in 
Xinjiang. So if you read those things, you would say, ``Well, 
this is not different at all from in the Han majority 
regions.'' In that sense, I would say the differences are not 
that great.
    Incidentally, I would argue the ethnic autonomy or self-
ruling in China, unfortunately, although it is pretty nice on 
paper, in reality, really is not that much.
    Ms.  Froissart. I would like to add some comments about who 
is deciding on hukou reforms. The central state designs the 
general framework of the reforms, and local governments adapt 
it in their local regulations according to their financial 
resources and so-called ``local conditions.'' This is the 
reason why different emphasis or priorities can be found 
locally. In Chengdu the hukou reform basically follows two 
strategies. First, as in many cities, it aims to attract and 
keep the elite of the migrants. The second strategy is to 
extend the limits of the city by integrating the rural 
districts of the municipality into the urban area. Those who 
benefit from the reform are the peasants living in the suburbs 
and those who are left behind are the migrants coming from 
other parts of Sichuan province, or elsewhere in the country, 
and the ones who are transient.
    Since we said much about the limits of the hukou reform, I 
would like also to mention that China has made a lot of 
progress in very few years. Especially since the custody and 
repatriation system was abolished in 2003 following the Sun 
Zhigang case.
    The custody and repatriation centers were a kind of prison 
where migrants without an identity card, residential permits, 
and/or working permits, were detained. They were sometimes 
forced to work to gain their liberty, or sent back to their 
villages. In April 2003, a migrant worker called Sun Zhigang 
was arrested in Guangzhou and taken by the police to one of 
these centers where he was beaten to death. The case triggered 
a public outcry that led eventually to the abolition of these 
centers.
    Chinese police have now lost one of the most effective 
means to compel migrants to register with the administration. 
In Shenzhen and Guangzhou, fewer and fewer people have permits 
because the police do not have any rights to launch raids 
against migrants or ``Strike Hard'' campaigns with the motive 
of clearing up the cities of their non-residents.
    So an increasing number of migrants are not registered with 
the police, which can lead to a false sense of citizenship. 
More and more people can just live like this for many years 
without having the feeling that they are discriminated against, 
until the day they have an industrial accident and cannot get 
proper medical or injury insurance coverage, or until the day 
they need to apply for administrative services.
    For example, I became friends with a young migrant worker 
in Shenzhen and I invited her to come to Hong Kong to visit me. 
Although she had been working for many years in a foreign 
insurance company, her employer never took care of her 
residential permit or even asked for it, and without this 
permit she could not apply for a Hong Kong visa.
    So many migrants just do not notice that they are 
discriminated against until they face a problem or want to send 
their children to school. In such cases, this is how people 
become aware of the role played by the hukou system.
    Mr. Dorman. Good.
    I would now like to recognize Commission Senior Counsel 
Keith Hand. Since we only have about 12 minutes left, I will be 
more severe with time limits, because I am sure Carl wants to 
ask a final question.
    So, Keith.
    Mr. Hand. Thanks, David. Thanks to you both for your 
presentations.
    A quick clarification on this last point about the custody 
and repatriation regulations. Since those regulations were 
abolished, have the police had any legal basis to detain and 
expel someone solely on the basis of their hukou status?
    Ms.  Froissart. No. This is the point I tried to make.
    Mr. Hand. Right.
    Ms.  Froissart. No. They do not have any legal basis to do 
that any more, and in fact they never had. Repatriation of 
migrant workers was never stipulated in the law; it was an 
abuse of power by the police and a misuse of the custody and 
repatriation centers. This was publicly and forcefully 
denounced and led to the abolition of the system. These centers 
have now returned to their initial mission: providing relief to 
the poor and the vagrants.
    Mr. Hand. So the only enforcement mechanism is restrictions 
on obtaining public services. It seems like a kind of de facto 
enforcement. But in theory they do not have any direct legal 
authorization to expel someone, correct?
    Ms.  Froissart. However, it is not because the police do 
not have legal authorization to expel someone on his hukou 
basis that it won't happen again. Just wait for the Olympic 
Games in 2008, for example. I am sure we will see, again, a 
``Strike Hard'' campaign. Once you have any kind of big 
political meeting or important events taking place in a city, 
it is always a good occasion to send back migrant workers to 
the countryside. However, urban authorities will potentially 
have to find another justification for the campaign other than 
chasing the ``three withouts''--migrants without the three 
permits. They will, for example, say that they are improving 
security, hygiene, or traffic in the capital.
    Since the abolition of the custody and repatriation system, 
there was no occasion to launch a significant ``Strike Hard'' 
campaign against migrant workers, but that doesn't mean that we 
will not see it again in the future. As you may know, it is not 
because the law in China prohibits something that the 
authorities are standing aside.
    Mr. Wang. Yes. To answer that question very briefly, I 
think it is too soon to tell whether the new change made by 
Premier Wen Jiabao and the government just a year and a half 
ago will be fully and faithfully implemented. We do not know. 
It is too soon to tell. As Chloe was mentioning, we have to 
wait for the next ``Strike Hard'' campaign to come about to see 
what is happening.
    My hunch is that it is not going to be implemented, even 
with what I understand about what is going on there, because 
you already hear some backlash this year, particularly in the 
summer. I heard so many complaints by Beijing and Shanghai 
residents about the sudden increase of beggars on the streets, 
for example, to the point that they grab tourists' legs, asking 
for money, because they are not automatically repatriated any 
more. But if they are caught begging, the police still have the 
legal authority to send them back, because they are not 
supposed to be begging in the street. If you wander around the 
street without papers that is fine, but you cannot beg.
    Also, because the Olympics are coming around and a new 
major celebration is coming around next month on October 1 for 
National Day, and also the 40th anniversary of the 
establishment of Xinjiang, we will see what will happen in 
Beijing. After that, we will probably have a better sense as to 
how faithful the implementation of this law is once this change 
is made. Given the popular backlash, and given the magnitude, I 
think the local police are probably still doing the 
repatriation thing, but maybe under a different name, and that 
is very Chinese.
    Mr. Hand. Thank you.
    Mr. Dorman. Thank you.
    I would like to turn the questioning over to Commission 
Senior Research Associate Laura Mitchell.
    Laura.
     Ms. Mitchell. Thank you. Thank you very much for being 
here.
    You have both discussed inequalities in labor, particularly 
in urban areas. Could you elaborate a bit more on the 
inequalities that exist and talk about the kinds of jobs are 
given hukou status? What are the social repercussions?
    Mr. Wang. To answer the question, very briefly, I think the 

discrimination, or exclusion, if you will, against the 
outsiders in Chinese urban centers, in terms of employment and 
work, can be understood in several ways. One way, is the 
availability of jobs. As we talked about earlier, in some 
localities, especially in big urban centers like Beijing and 
Shanghai, certain jobs are openly declared to be off-limits to 
outsiders. If you do not have local hukou residency papers, you 
cannot even apply. That is clearly the case.
    As recently as 2001-2002, Beijing government officials 
listed only two kinds of jobs out of nine or seven--it is in my 
book, I do not remember exactly now--that are possibly 
available to outsiders, with proper permits, that is. One is 
garbage collection/recycling, and the other one is what they 
call ``special industries'' that include massage parlors, and 
the hotel business and the restaurant business. So it may have 
been changed a little bit, but I suspect that access is still a 
problem.
    The second way to see that is in the area of pay. There is 
a clear inequality of pay between local hires and those from 
outside, and that is exactly why the Chinese products are found 
in so many American stores these days, because many of them 
actually are produced by cheap, outside laborers. In Shenzhen, 
for example, for almost 10 years, the average wages have not 
changed for these assembly line workers. American consumers 
love the low price of Chinese goods, but if the workers happen 
to be migrant laborers, their life chances basically are 
diminished.
    The third way to see that is in social services, job 
security, and also the welfare system. Job training, and also 
all those benefits basically are not available to you if you 
are a migrant worker. 
Finally, the local community-funded benefits, such as housing 
subsidies, education, and public health services. Even cell 
phone service. For example, in major cities such as Shanghai 
and Beijing, if you do not have local hukou, you do not have 
local residency, you cannot get cheaper cell phone service. The 
alternative is a much more expensive cell phone service.
    So, those are some different ways I think we can see the 
inequality in terms of labor and the treatment of labor in the 
China.
     Ms. Mitchell. Thank you.
    Ms.  Froissart. Regarding labor rights, the hukou system 
enables discrimination in many areas. First, the migrant 
workers are the ones who are doing the ``zang, ku, lei,'' the 
most difficult, dangerous, and dirty jobs that urban people do 
not want to do.
    Second, is the pay, as Fei-Ling just said. There are many 
studies showing that, for the same work, migrant workers are 
paid less than urban workers. They also have less access to 
trade unions and fewer opportunities to obtain promotions.
    Although labor laws do not discriminate between urban and 
migrant workers, the latter are often denied in practice the 
right to become trade union members, whether because their 
employers do not want a trade union branch to be set up in 
their factories or because local trade unions do not feel 
concerned by non-residents' fate. It is also even more 
difficult for them to lodge a complaint with the urban labor 
administration as it is for urban workers because of officials' 
``local protectionism.'' The All China Federation of Trade 
Unions launched a campaign in the summer of 2003 to call for 
migrant workers' enrollment in trade unions. This is a way for 
the Federation of Trade Unions to gain more members, and to 
reassert the Party's control over this population.
    According to my survey, however, migrant workers are 
reluctant to join official trade unions. First, they had so 
many experiences of being cheated by Party or state 
organizations that they really do not trust them any more. 
Second, they are also aware of how trade unions are connected 
with both political power and employers.
    About promotions, I did not meet many migrant workers who 
were promoted by seniority or because their proficiency was 
acknowledged by their employers. Rather, if they receive any 
promotion, it is thanks to their personal efforts to learn more 
or to their strategies to get around the discriminatory 
practices of their employers. An increasing number of migrant 
workers take part in correspondence courses or attend night 
schools, especially training schools that are set up by NGOs.
    Migrants also try to get a promotion by regularly changing 
their work. They try to use the experience they gained in their 
previous job to apply for a better job in another factory or 
another company. In the Pearl River Delta, thanks to new 
measures that aim to prevent employers from retaining migrants' 
ID or salaries, some workers just stay over the training period 
and then quit their job. But it is really rare for migrants to 
receive a promotion in the same factory or company.
    Finally, migrant workers do not get any support when they 
are unemployed. Since they are expected to go back to their 
villages once jobless, they are not entitled to any 
unemployment subsidies and are not concerned by training and 
reemployment policies in urban areas.
    These are, in my view, the main points where stronger 
discrimination between migrant and urban workers can be found 
regarding labor law. Recently there has been a growing number 
of riots and strikes, especially among migrants working in 
Southern China in joint ventures, but they seem to be less 
directly triggered by this particular discrimination than by 
the general lack of institutional guarantees of workers' 
rights, especially by the absence of an independent judiciary 
and trade unions. Discrimination can become a bone of 
contention under three conditions. First, if urban people and 
migrants are doing the same jobs or if they are working in the 
same places, but factories in the Pearl River Delta, for 
example, are mainly hiring migrant workers. Second, when 
migrating ceases to be profitable; discrimination is more 
bearable when migrants still earn more in the cities than they 
would in the countryside. Third, when there is no means to get 
around discriminatory practices, turnover is a way for migrant 
workers to protect themselves against such practices.
    Mr. Dorman. Good. Thank you.
    Once again, our 90 minutes has flown by, but I think we 
have about a minute left. I would like to give Carl, who 
organized the roundtable, the last question.
    But we will have to limit the responses to a minute or two, 
if we could. Thank you.
    Mr. Minzner. Thank you very much, David. Again, thanks to 
Chloe and to Fei-Ling.
    As the last question, one of my concerns that I would ask 
you to comment on is the concept that the hukou system seems to 
be evolving into a set of societal divisions within Chinese 
cities. The hukou system used to be a division between rural 
and urban areas, but it now seems to be moving to a system of 
societal divisions within Chinese urban areas, hardening into a 
very tough division within the cities. Could you, first, just 
comment on that?
    Second, one of the other things that strikes me is that 
this would be very bad for social stability within China. It 
would not seem to be a very good thing if you have very sharp 
societal divisions in your urban areas, rich, poor, haves, 
have-nots. Could you comment about that, also?
    Mr. Wang. You are absolutely right. The hukou is 
solidifying lots of divisions, not just between rural and urban 
any more. Mostly it is between those who pop in and those who 
were originally there. In other words, in my book I describe 
China as a collection of many societies, many countries. You go 
from Sudan at one developmental level, to Singapore at another, 
with various different developmental levels in between. So that 
is why, in the recent paper I just finished and which will be 
published soon, I hope, I argued that the hukou system provided 
stability for the CCP, for sure, but is also brewing 
uncertainties and instabilities, precisely because it pits 
people against each other.
    But the beauty of the hukou system, from Zhongnanhai's 
point of view, is that it does not create one-versus-the-other, 
kind of black-versus-white divisions. Rather, it creates multi-
divisions, several divisions and it clearly cut in different 
ways. So that actually, dynamically, so to speak, may have 
helped stability itself. It looks like it brewed tensions, 
grievances, unhappiness, and anger, but because it is divided 
so many ways, it does not really create viable opposition to 
the leadership.
    Ms.  Froissart. I completely agree. We spoke a lot about 
one of the core functions of the hukou system, which is to 
control urbanization. But I totally agree with Fei-Ling, that 
one of the functions of the hukou is to create divisions within 
Chinese society. These societal divisions are, indeed, helping 
the Communist Party to exert a tighter control over the 
society, just because they make it very hard for the people to 
unite on common claims. People just do not have the same rights 
and do not face the same situations. The different kinds of 
status and social stratifications created by the hukou system 
are as much a prop that helps the Communist Party rule over 
China as a factor of social instability.
    Mr. Dorman. Well, good. With that, I will have to call the 
roundtable to a close. But once again, I would like to thank 
our two witnesses for a very interesting and very important 
discussion.
    I can tell by the number of questions still on my sheet, 
and the fact that I was only able to ask one question, that we 
will have to continue this discussion at some future date. 
There is much more to talk about.
    But, again, thank you very much. This roundtable has 
concluded.
    [Whereupon, at 3:35 p.m. the roundtable was concluded.]


                            A P P E N D I X

=======================================================================


                          Prepared Statements

                              ----------                              


                  Prepared Statement of Fei-Ling Wang

                           SEPTEMBER 2, 2005

    I would like to first express my appreciation for the opportunity 
to appear before the Congressional-Executive Commission on China and 
discuss China's hukou (household registration) system today. I believe 
there are few other institutions more important than the hukou system 
in defining and conditioning politics, social life, and economic 
development of the People's Republic of China (PRC). Currently, this 
long-lasting and highly peculiar Chinese institution continues its 
crucial functions while demonstrating significant changes.
    In this written statement, I would like to first briefly describe 
the current status of the hukou system and its leading functions. The I 
will outline the major changes and reforms of the system in recent 
years. Finally, I would like to point out that the hukou system has a 
complex role in China that makes its reform both highly difficult and 
extremely consequential. In short, the hukou system facilitates a rapid 
but uneven economic growth, creates significant social and regional 
disparities and injustice, stabilizes the PRC sociopolitical order, and 
generates powerful tensions in the areas of human rights, equity of 
citizenship, and simple ethics.\1\
---------------------------------------------------------------------------
    \1\ For a comprehensive study of the hukou system, see Fei-Ling 
Wang, Organizing through Division and Exclusion: China's Hukou System, 
Stanford, CA: Stanford University Press, 2005. For the reforms of the 
hukou system, see Fei-Ling Wang, ``Reformed Migration Control and New 
List of the Targeted People: China's Hukou System in the 2000s,'' The 
China Quarterly, (March) 2004, 115-132. For earlier studies of the 
system, see Tiejun Cheng, Dialectics of Control: The Household 
Registration (Hukou) System in Contemporary China, Ph.D. dissertation, 
SUNYT-Binghamton, 1991. Tiejun Cheng & Mark Selden, ``The Origins and 
Social Consequences of China's Hukou System,'' The China Quarterly, 
1994. Dorothy J. Solinger, Contesting Citizenship in Urban China: 
Peasant Migrants, the State, and the Logic of the Market, Berkeley, CA, 
University of California Press, 1999.
---------------------------------------------------------------------------
                     HUKOU SYSTEM IN TODAY'S CHINA

    Formally adopted in the 1950s, the hukou system can actually be 
traced back to the fifth century B.C. during the Warring States period. 
It was institutionalized and adopted with varied degrees of 
effectiveness and extensiveness as an important part of the Chinese 
imperial political system by the dynasties from the Qin (third century 
B.C.) to the Qing (1644-1911). The Republic of China (ROC) and the PRC 
both established a national hukou system. However, the hukou system 
achieved an unprecedented level of uniformity, extensiveness, 
effectiveness, and rigidity only in the PRC since the 1950s.\2\
---------------------------------------------------------------------------
    \2\ Solinger 1999; Delia Davin, Internal Migration in Contemporary 
China. New York, Palgrave, 1999; Michael R. Dutton, Policing and 
Punishment in China: From Patriarchy to ``The People,'' New York: 
Cambridge University Press, 1992; Lei Guang, ``Reconstructing the 
Rural-Urban Divide: Peasant Migration and the Rise of `Orderly 
Migration' in Contemporary China,'' Journal of Contemporary China, vol. 
10-28, 2001, 471-493; Jianhong Liu, Lening Zhang & Steven F. Messner, 
eds., Crime and Social Control in a Changing China, Greenwood 
Publishing Group, 2001; Hein Mallee, ``China's Household Registration 
System under Reform,'' in Development and Change, vol. 26-1 (January 
1995).
---------------------------------------------------------------------------
    On 9 January 1958, Mao Zedong promulgated The Regulation on hukou 
Registration of the People's Republic of China, formally creating the 
PRC national hukou system. Twenty-seven years later, on 6 September 
1985, Beijing adopted its Regulation on Resident's Personal 
Identification Card in the People's Republic of China. These two 
regulations and their implementation procedures are the main legal 
basis for the PRC hukou system. Every Chinese citizen knows and is 
affected by the hukou system, yet the system has remained an 
administrative system, highly nontransparent, not mentioned in The PRC 
Constitution.
    The PRC State Council and its ministries, mainly the Ministry of 
Public Security, and the local public security bureaus and police 
stations are the administrators of the hukou system. Specialized hukou 
police officers are assigned to be in charge of hukou matters in each 
hukou zone: a neighborhood, street, danwei (unit), or a township. The 
hukou system requires every Chinese citizen to be officially and 
constantly registered with the hukou authority (the hukou police) since 
birth, as the legal basis for personal identification. The categories 
of non-agricultural (urban) or agricultural (rural), the legal address 
and location, the unit affiliation (employment), and a host of other 
personal and family information, including religious belief and 
physical features, are documented and verified to become the person's 
permanent hukou record. A person's hukou location and categorization or 
type were determined by his mother's hukou location and type rather 
than his birthplace until 1998, when a child was allowed to inherit the 
father's or mother's hukou location and categorization.
    One cannot acquire a legal permanent residence and the numerous 
community-based rights, opportunities, benefits and privileges in 
places other than where his hukou is. Only through proper authorization 
of the government can one permanently change his hukou location and 
especially his hukou categorization from the rural type to the urban 
one. Travelers, visitors, and temporary migrants must be registered 
with the hukou police for extended (longer than three days) stay in a 
locality. For longer than one-month stay and especially when seeking 
local employment, one must apply and be approved for a temporary 
residential permit. Violators are subject to fines, detention, and 
forced repatriation (partially relaxed in 2003). hukou files are 
routinely used by the police for investigation, social control, and 
crime-fighting purposes.
    Officially and internally, the PRC hukou system has one common 
governance duty (to collect and manage the information of the citizens' 
personal identification, kinship, and legal residence) and two ``unique 
missions:'' to control internal migration through managing temporary 
residents/visitors; and to have a tiered management of zhongdian renkou 
(targeted people) in the population.\3\
---------------------------------------------------------------------------
    \3\ Jiang Xianjin & Luo Feng eds., Jingca yewu shiyong quanshu-
zhian guanli juan (Complete guide of police works-volume on public 
security management), Beijing, Quinzhong Press, 1996, 218 & 220. BPT-
MPS (Bureau of Personnel and Training-Ministry of Public Security), 
Huzheng guanli jiaocheng (The text book on hukou management), Beijing: 
Qunzhong Press, 2000, 5 & 161-173.
---------------------------------------------------------------------------
    In practice, the PRC hukou system has performed three leading 
functions. First, it is the basis for resource allocation and 
subsidization for selected groups of the population (mainly the 
residents of major urban centers). This function has shaped much of the 
Chinese economic development in the past half century by politically 
affecting the movement of capital and human resources. The government 
has been traditionally heavily favoring the urban centers since the 
1950s with investment and subsidies.
    Second, the hukou system allows the government to control and 
regulate internal migration especially the rural-to-urban migration. 
The basic principles of the PRC migration control have been to restrict 
rural-to-urban and small-city-to-large-city migration but encourage 
migration in the reversed direction. China's urbanization, as a 
consequence, is relatively small and slow compared to its economic 
development level. China's urban slums are also relatively small and 
less serious compared to those in many other developing nations such as 
Brazil or India. Third, the hukou system has a less well-known but very 
powerful role of social control especially the management of the so-
called targeted people (zhongdian renkou). Based on hukou files, the 
police maintains a confidential list of the targeted people in each 
community to be specially monitored and controlled. Such a focused 
monitoring and control of selected segments of the population have 
contributed significantly and effectively to the political stability of 
China's one-party authoritarian regime.
    In the 2000s, the hukou system still enjoys a strong institutional 
legitimacy in China. Unlike the similar but now disgraced and 
disintegrated propiska (residential permit) system in the former Soviet 
Union, the PRC hukou system is still both legal and strong. With some 
reforms and limited alterations, the hukou system continues to be a 
backbone of Chinese institutional structure and fundamentally 
contributes to the seemingly puzzling coexistence of China's rapidly 
developing market economy and the remarkable stability of the CCP's 
(Chinese Communist Party) political monopoly.

                  REFORMS AND CHANGES IN RECENT YEARS

    The hukou system has been an administrative system with sketchy 
legal foundations. It has been governed and regulated by mostly 
``internal'' decrees and directives.\4\ There have been talks in 
Beijing about making a PRC hukou Law to firmly ground this important 
system in ``modern legal languages'' since the 1980s.\5\ Yet, by 2005, 
this effort is still at a very early stage with no date of completion 
in sight.
---------------------------------------------------------------------------
    \4\ Wang Huaian et al eds.: Zhonghua renmin gongheguo fali quanshu 
(Complete collections of the laws of the People's Republic of China), 
Changchun: Jilin Renmin Press, 1989.
    \5\ One Chinese National People's Congress (NPC) deputy did propose 
a bill for hukou law in March 2001. (Associated Press, Beijing, March 
15, 2001). But it had no chance to be even included in the legislature 
agenda. Such symbolic actions were seen at the annual meetings of the 
NPC every March in 2002-05.
---------------------------------------------------------------------------
    The hukou system's much examined function of resource allocation 
and subsidization to the urbanites has now been reduced and even 
replaced by the advancing market forces, as the urban rations of food 
and many other supplies have now either disappeared or become 
insignificant.\6\ Furthermore, there has been fairly extensive cosmetic 
reform efforts aiming at erasing the unsightly distinction between 
rural and urban residents.
---------------------------------------------------------------------------
    \6\ Urban hukou holders in major cities, however, still enjoy 
significant state subsidies in housing, healthcare, employment, and 
especially education. In 2001, for example, a Beijing resident can get 
into college with a minimum admission score 140 points (or 28 percent 
of the national average score) lower than that in Shangdong Province. 
Zhongguo qingnian bao (Chinese youth daily), July August, 2001.
---------------------------------------------------------------------------
    The administration of the well-known function of internal migration 
control is now reformed, relaxed and localized, given rise to increased 
mobility of the population in general and the rural laborers in 
particular.\7\ Since 1997 and especially since 2001, there has been so-
called ``deep reforms'' of the hukou system, primarily concerning its 
migration-control function. Various schemes such as the so-called 
``blue stamp'' hukou (functions like a ``green card'' issued to aliens 
in the United States), temporary residency (functions like working 
visas), and the locally defined ``entry conditions'' for permanent 
migration,\8\ nicknamed ``local hukou in exchange for talents/skills 
and investment,'' have significantly increased the mobility of selected 
groups of people. Now, anyone who has a stable non-agricultural income 
and a permanent residence in a small city or town for at least two 
years will automatically qualify to have an urban hukou and become a 
permanent local resident.\9\ Some medium and even large cities are also 
authorized to do the same, with a higher and more specific income, 
employment, and residence requirement.\10\ Yet, the hukou system still 
demonstrates its remarkable continuity as the governing principles of 
internal migration regulation remain fundamentally unchanged. Other 
than the needed labor, especially skilled labor, and the super-rich, 
China's major urban centers take in few ``outsiders.''
---------------------------------------------------------------------------
    \7\ Kam Wing Chan & Li Zhang, ``The Hukou System and Rural-Urban 
Migration in China: Processes and Changes,'' The China Quarterly, 1999: 
831-840.
    \8\ Renmin Ribao (People's daily), Beijing, September 24, 2001, 9. 
South China Morning Post, September 29, 2001. Nanfanf dushibao 
(Southern metro daily), Guangzhou, September 8, 2001. China New Agency 
News Dispatch, Guangzhou, September 24, 2001. Hunan ribao (Hunan 
daily), Changsha, January 20, 2002 and Renmin ribao-huadongban 
(People's daily East China edition), Shanghai, January 9, 2002. Nanfang 
dushi bao (Southern urban daily), Guangzhou, September 8, 2001. Xinhua 
Daily Telegraph, Beijing, December 24, 2001.
    \9\ But ``all the migration registration procedures are still to be 
followed strictly.'' Zhongguo minzhen (China civil affairs), Beijing, 
No. 11 (November), 2001, 57.
    \10\ Renmin Ribao (People's daily), Beijing, September 4, 2001.
---------------------------------------------------------------------------
    Some provinces ventured further. Guizhou, one of the poorest 
provinces, decided to give a small city/town urban hukou to anyone who 
meets the income and residence requirements immediately, waiving the 
usual two-year waiting period. Shangxi, another less developed 
province, used urban hukou to reward migrant ruralites who have moved 
to those remote regions to reclaim desert land through tree-
planting.\11\ However, merely eight months into the reform, in mid-
2002, this national wave to rename rural/urban distinction was ordered 
by Beijing to stop, pending ``further instructions.'' The suspension 
seems to be primarily the result of the lack of funding and 
infrastructure to quickly accommodate new urban residents' massive need 
in education, health care, and social welfare.\12\
---------------------------------------------------------------------------
    \11\ Xinhua Daily Telegraph, Beijing, August 9, 2001.
    \12\ China News Weekly, Beijing and Huaxi dushi bao (Western China 
metro news), Chengdu, September 5, 2002.
---------------------------------------------------------------------------
    The third leading, albeit much less known but highly crucial, 
function of the hukou system, the management of the targeted people, 
however, remains to be highly centralized, rigid, and forceful, 
although its effectiveness has been declining steadily. The changes of 
the management of the targeted people function so far are mainly 
technical and marginal. There actually is a tendency for this 
sociopolitical control function to be improved and enhanced in the 
2000s. In the summer of 2001, when the rural-to-urban migration quota 
was partially replaced in the PRC, one MPS senior official called for 
further ``reducing the undue burden on the hukou system by getting rid 
of its economic and education functions'' so to ``enhance the hukou 
system'' and ``restore its original'' main mission of population 
management and social control.\13\ Indeed, the police has been 
internally calling for a further enhancement of the targeted people 
management in its battle against Muslim terrorist cells in the remote 
regions of Western China, where many non-Han ethnic groups live.\14\
---------------------------------------------------------------------------
    \13\ Interviews reported by China Net's News Center on http://
www.newsw.china.com, August 20, 2001. Accessed on March 23, 2002.
    \14\ Cheng Zhiyong and Bo Xiao, eds. Qiangzhan yu qiangan (Gun-
battles and gun-cases: selections of case reports on anti-terrorism in 
Xinjiang), internal publication. Beijing: Qunzhong Press, 2000, 129-
130, 164, & 253-254.
---------------------------------------------------------------------------
    To manage the massive files of the hukou system, the MPS started to 
establish electronic hukou data base in 1986 and got special funding 
for national computerization of the hukou system in 1992. By 2002, 
almost all (more than 30 thousand) police stations have computerized 
their hukou management. 1,180 cities and counties joined regional 
computer networks for file-sharing of the hukou records of a total of 
1.07 billion people (about 83 percent of the total population), and 250 
cities joined one single national hukou computer network to allow for 
instantaneous verification of hukou information covering 650 million 
people (about half of the total population).\15\ In 2002, the MPS 
further required all hotels with 50 beds and larger to have computer 
links to instantaneously transmit the photos of all guests to local 
police station.\16\
---------------------------------------------------------------------------
    \15\ DOP-MPS (Department of Politics-Ministry of Public Security), 
Gongan yewu jichu zhishii (Basic knowledge of public security works), 
Beijing: Qunzhong Press, 1999, 75-76. Zhongguo qingnian bao (Chinese 
youth daily), Beijing, January 5, 2002.
    \16\ ``E jingcha kaishi liangxian, huji dangan jiang dianzihua'' 
(E-police starts to emerge and hukou files will be electronic), 
www.news.china.com. Accessed on February 19, 2002. The police believed 
that several high profile criminal cases in 2002 were solved due to the 
hukou police's routine but now faster gathering and monitoring of hotel 
registration information. Author's interviews in Beijing and Shanghai, 
2002.
---------------------------------------------------------------------------
    The new leadership of Hu Jintao and Wen Jiabao since 2003 has shown 
signs of considering the negatives of the hukou system as a political 
liability and trying in certain way to ease further some of the rough 
edges of the system; however, the 2001 reform of the hukou system 
remained very much unaccomplished four years later, especially above 
the level of small towns and cities, and led to significant regional 
discrepancies. By mid-2005, the PRC hukou system has developed an even 
stronger character of regionalization.
    On March 17, 2003, a young migrant from Wuhan of Hubei Province 
named Sun Zhigang was arrested for having no identification papers by 
the police in Guangzhou, where he was actually lawfully employed and 
registered. He was in typical manner abused by the police and brutally 
beaten to death three days later by fellow inmates during the 
repatriation process. The case was reported by influential Chinese news 
outlets and led directly to a public outcry against the irrationality 
and injustice generated by the hukou system, especially the practice of 
forced repatriation. A dozen perpetrators, including several police 
officers, were sentenced to death or long jail terms. As a result, the 
PRC State Council canceled the 1982 ``Measures of Detaining and 
Repatriating Floating and Begging People in the Cities,'' issued 
``Measures on Repatriation of Urban Homeless Beggars'' on June 18, 
2003, and ``Measures on Managing and Assisting Urban Homeless Beggars 
without Income'' on June 20, 2003, establishing new rules governing the 
handling and assisting of destitute migrants. Many cities, including 
the most controlled Beijing municipality, decided soon after that 
hukou-less migrants must be dealt with more care; they are no longer 
automatically subject to detention, fines, or forced repatriation, 
unless they have become homeless, paupers, or criminals.\17\
---------------------------------------------------------------------------
    \17\ Zhang Yinghong, ``Sun Zhigang zhisi yu zhidu zhier'' (The 
death of Sun Zhigang and the evil of the [hukou] system), Apr. 28, 
2003, www.mlcool.com; Caijing shibao (Financial and economic times), 
Beijing, June 15, 2003; Changsha wanbao (Changsha evening news), June 
13, 2003; Xinhua Daily Telegraph, Beijing, June 21, 2004.
---------------------------------------------------------------------------
    This change of repatriation policy was a much needed reform and has 
been widely praised as a humane move by the Hu-Wen ``new politics.'' 
However, as an interesting twist that vividly reveals the political 
reality in the PRC, the editor and the reporter of the newspaper, 
Nanfang Dushi Bao (Southern urban news), who broke the Sun Zhigang 
story, were soon arrested and sentenced to prison for multiple years 
under trumped up charges of bribery and corruption in 2004-05. 
Furthermore, empirically, perhaps as a good sign to show the 
complicated role of the hukou system, the relaxed measures of forced 
repatriation has seemed to cause the surge of paupers in places like 
Beijing's Tiananmen Square in the two years afterwards. Hence the 
discussion of a ``Latin-Americanization'' and the concern about decay 
of the Chinese urban business environment emerged in the PRC's 
relatively free cyber space by mid-2005.\18\ To be sure, the latest 
hukou reform has relaxed and decentralized internal migration control 
mechanisms (mainly in the small cities and towns) but has not touched 
the sociopolitical control functions of the system. The majority of the 
over 100 million migrants or ``floating population'' still appear to be 
unable to change the location of their hukou permanently. In Ningbo of 
Zhejiang Province, a national model of the hukou reform, only about 30 
thousand migrants, less than two percent of the two million migrants 
from the countryside (who constitutes one-third of the city's total 
population) are expected to qualify for local hukou during the 
reform.\19\ In Shijiazhuang of Hebei Province, only 11 thousand migrant 
workers (out of 300 thousand in the city) were qualified to apply for 
local hukou in 2001. A key problem has been the difficulty for a 
migrant to find a stable job in the city, which has already been 
plagued by high unemployment for years.\20\
---------------------------------------------------------------------------
    \18\ Zheng Binwen, ``China should carefully prevent Latin 
Americanization,'' www.yannan.cn/data/detail.php?id=5889 May 29, 2005.
    \19\ ``Ningbo hukou bilei hongran daota'' (The hukou barriers 
collapsing), in Nanfang zhoumu (Southern weekend), Guangzhou, August 
31, 2001. Zhongguo qingnianbao (Chinese youth daily), September 17, 
2001.
    \20\ Josephine Ma, ``Farmers Turn Noses up at Life in the City,'' 
South China Morning Post, Hong Kong, October 17, 2001.
---------------------------------------------------------------------------
    Limited and controlled, the latest hukou reform has started to 
change the unsightly and discriminatory legal distinction between rural 
and urban hukou holders. It is a major albeit highly symbolic victory 
of the advancing market institution and new norms of citizenship and 
human rights in China. However, ``the hukou system has not been 
abolished but only enhanced and improved with scientific means,'' 
declared a Chinese leading hukou expert associated with the MPS. The 
universal residential registration, the basic principles of internal 
migration control, and the uniquely Chinese style sociopolitical 
control through the management of targeted people all continue and will 
be further ``strengthened.'' The hukou reforms are to be ``well-
synchronized; must consider the rational flow and allocation of talents 
and labor, and guarantee the stability of socioeconomic order.'' \21\
---------------------------------------------------------------------------
    \21\ Wang Taiyuan's interview with People's Net News on October 1, 
2001. Accessed on January 19, 2002.
---------------------------------------------------------------------------
      usefulness versus liability: the future of the hukou system
    The PRC hukou system has been playing profound and complex roles in 
Chinese political economy. It has contributed significantly to China's 
sociopolitical stability by creating an environment that is conducive 
to the perpetuation of an authoritarian regime, albeit still leaving 
some room for a possible elite democracy to develop. It has allowed the 
PRC to circumvent the so-called Lewis Transition and hence to enjoy 
rapid economic growth and technological sophistication in a dual 
economy with the existence of massive surplus labor, while producing 
tremendous irrationalities, imbalances, and waste in the Chinese 
economy and barriers to further development of the Chinese market. 
Finally, the PRC hukou system has created clear horizontal 
stratification, regional gaps, and personal discrimination that not 
only directly challenge social justice and equity but also potentially 
call China's political cohesion and national unity into question.\22\
---------------------------------------------------------------------------
    \22\ Fei-Ling Wang, Organizing through Division and Exclusion: 
China's Hukou System, Stanford, CA: Stanford University Press, 2005) 
especially pp. 129-165.
---------------------------------------------------------------------------
    There are clear institutional and policy usefulness of this 
otherwise ethically clearly questionable system, which makes its reform 
a highly difficult and complicated mission. In a way, the ``positive'' 
economic impact of the hukou system in China may be viewed as similar 
to that of the Westphalia international political system on the world 
economy since the end of the Middle Ages. Under the Westphalia system, 
there is a political division of the sovereign nations, a citizenship-
based division of humankind, and an exclusion of foreigners maintained 
by the regulation and restriction of international migration. These may 
have indispensably contributed to the development of the modern 
capitalist market economy that has brought unprecedented economic 
growth and technological sophistication in the ``in'' parts of the 
world, primarily the nations that today form the Organization of 
Economic Cooperation and Development (OECD). The world economy has 
developed spectacularly in the past few centuries, but in the 2000s, 80 
percent of humankind still lives in the less developed nations, 
excluded from most of the world's achievements.\23\ China's prosperous 
urban centers in its eastern and coastal regions, compared with the 
country as a whole, may be functionally viewed as roughly equivalent to 
the OECD nations in comparison with the world. A key difference, 
however, is that the citizenship-based institutional divide between the 
OECD nations and the rest of the world is much more rigidly defined and 
forceful, hence more effectively enforced than the hukou barriers that 
separate the urbanites in Shanghai and Beijing from the ruralites in 
the inland Chinese provinces. Furthermore, a central government in 
Beijing that regulates the hukou system and provides some cross-
regional resource reallocation may have made the hukou system a bit 
more tolerable to the excluded.
---------------------------------------------------------------------------
    \23\ UNDP (United Nations Development and Planning), Human 
Development Report 2001, New York: Oxford University Press, 2001, 144 
and 157.
---------------------------------------------------------------------------
    The usefulness of the hukou system, especially seen in economic 
growth, is accompanied by tremendous negative consequences that are 
constituting increasingly heavy liability for the Chinese political 
system. A leading consequence of the PRC's hukou system has been, not 
surprisingly, a relatively small and slow urbanization in China. It 
almost stopped and even decreased for about two decades under Mao 
Zedong. During the reform era, China's urbanization has been 
significantly slower than its economic growth and industrialization 
rate, even though the adaptive measures and the practical relaxation of 
the hukou system have accelerated urbanization since the late 1980s. By 
2000, China's urbanization was still only less than 30 percent, whereas 
countries in the same range of per-capita GDP had an urbanization of 
42.5-50 percent. Although by some indicators China's economic 
development in the late 1990s was at the level that the United States 
attained from the 1950s through the 1970s, China's urbanization was 
comparable to that in the United States only in the 1880s and 
1890s.\24\
---------------------------------------------------------------------------
    \24\ Robert W. Forgel, ``Aspects of Economic Growth: A Comparison 
of the U.S. and China,'' a conference paper, Chengdu, China, 1999, 1-2.
---------------------------------------------------------------------------
    Slow urbanization perpetuates a stable dual economy featuring a 
rural majority of the population and a stable, large, ever-increasing 
rural-urban disparity of income and resource distribution. Officially, 
the urban and rural incomes were disparate by a factor of about 2.2 in 
1964, 2.6 in 1978, 2.7 in 1995, and 2.8 in 2000. Semiofficially, the 
urban-rural income gap was estimated to stand at a factor of about 4.0 
in 1993.\25\ Including indirect income in the form of state subsidies, 
the gap stood at a staggering 5.0-6.0 by 2001.\26\
---------------------------------------------------------------------------
    \25\ Zhong Yicai, ``Chengxiang eyuan shehui de yonghe yu yingnong 
jingcheng'' (The merging of the dual urban-rural societies and the 
pulling of the peasants into the cities) in Shehui kexue (Social 
sciences), Shanghai, no. 1(1995), 55-58.
    \26\ State Statistics Bureau, ``Cong gini xishu kan pingfu chaju'' 
(Gap between rich and poor based on the Gini index), in Zhongguo 
guoqing guoli (China national conditions and strength), Beijing, No. 97 
(January, 2001), 29.
---------------------------------------------------------------------------
    A rigid and stable dual economy based on the exclusion of the rural 
population has systematically and artificially suppressed the rural 
Chinese market and may have severely limited the growth potential for 
the Chinese economy as a whole, which needs domestic demand to increase 
continually.
    In addition to perpetuating a dual economy and retarding the rural 
consumer market, the hukou system has created significant 
irrationalities in labor allocation and utilization. A two-tier, well-
segregated labor market for local urban hukou holders and outsiders 
exists in Chinese cities, leading to inequalities and inefficiencies 
within the same locality.
    An obviously negative impact of the hukou system has been that it 
brews regional disparities and inequality. As a high price of hukou-
assisted rapid growth, China has had a very uneven economic development 
across regions. A group of influential Chinese scholars concluded that 
``there are three main disparities in contemporary Chinese society: the 
disparities between the peasants and the industrial workers, between 
the urban and rural areas, and among the regions.'' \27\ The PRC hukou 
system is fundamentally responsible for all three.\28\
---------------------------------------------------------------------------
    \27\ Hu Angang, Wang Shaoguang & Kang Xiaoguang, Zhongguo diqu 
chaju baogao (Report on China's regional disparities), Shengyang: 
Liaoning Renmin Press 1995, 223.
    \28\ There are, naturally, many other factors responsible for the 
East-West gap in China. Dali Yang (Beyond Beijing: Liberalization and 
the Regions in China, London: Routledge, 1999) described a Chinese 
political system in which the PRC has been led by an east coast 
``oligarchy'' and the interests of the East dominate.
---------------------------------------------------------------------------
    Six provinces or metropolises in eastern China, out of 31, received 
54 percent of all Chinese research and development funding in 1994; the 
eighteen provinces in central and western China got only 35.9 
percent.\29\ In 1990, Beijing had the highest per-capita government 
spending at 633 Yuan RMB, about 2.7 times the lowest, 106 Yuan in Henan 
Province, only a couple of hundred miles away. In 1996, Shanghai had 
the highest per-capita government spending of 2,348 Yuan, 8.45 times 
the lowest, 278 Yuan, still in Henan Province. In 1998, per-capita 
investment in the three metropolises Shanghai, Beijing, and Tianjin was 
7.3, 5, and 3.1 times higher, respectively, than the national average, 
while the like in Guizhou Province was only 33 percent of the national 
average.\30\
---------------------------------------------------------------------------
    \29\ Guo Tong, ``Keji touru: Dongzhongxibu bupingheng'' (R&D 
investment: Uneven among the east, central and west), Zhongguo xinxibao 
(China journal of information), Beijing, Aug. 3, 1995, 1.
    \30\ State System Reform Commission), Gaige neichan (Internal 
reference on economic reform), Beijing, internal publication. Selected 
issues, 1998# 273, 22. Hu Angang & Zou Ping, Shehui yu fazhan: zhongguo 
shehui fazhan diqu chaju yanjiu (Society and development: A study of 
China's regional gap of social development), Hangzhou: Zhejiang Renmin 
Press, 5.
---------------------------------------------------------------------------
    At the end of the 1990s, per-capita annual GDP in Shanghai was over 
twenty-eight thousand Yuan RMB, twelve times higher than in Guizhou 
Province (merely 2,323 Yuan). The average annual wage in the coastal 
province of Guangdong was twice that in neighboring Jiangxi Province 
(3,595 vs. 1,713 Yuan).\31\ It is estimated that the east-west annual 
income gap grew from 48 percent in 1986 to 52 percent in 1991(2,283 
Yuan in the east and 1,095 in the west). In 2000, urban hukou holders' 
highest per-capita annual income was 11,802 Yuan (in Shanghai); the 
lowest was only 4,745(in Shanxi). Rural hukou holders' highest per-
capita annual income was 5,596 Yuan (again in Shanghai), and the lowest 
was only 1,331(in Tibet). By 2001, the highest per-capita urban income 
was 4.8 times greater in eastern than in western China.\32\
---------------------------------------------------------------------------
    \31\ Hu and Zou 2000, 3.
    \32\ State Planning Commission figures, Jingji gongzhuzhe xuexi 
ziliao (Study materials for economic workers), Beijing, no. 68(1994), 
7. Hunan ribao (Hunan daily), Changsha, Apr. 18, 2001.
---------------------------------------------------------------------------
    Politically, the regional gap is contributing to the rise of 
regionalism and regional protectionism that have already become major 
destabilizing factors in China in the early 2000s.\33\ In response, 
Beijing has issued numerous decrees to tear down economic barriers 
erected by local corporatist and protectionist activity.\34\ The 
central government's political stability and power and even the unity 
of the nation may be at stake.\35\ In many ways, the Chinese economy is 
not just a dual economy of rural and urban sectors but more a 
collection of several regional economies that are at various stages of 
development, with hugely different degrees of economic prosperity, 
separated chiefly by the hukou system. In other words, developed 
societies and the poorest societies coexist within one Nation not only 
vertically but also horizontally.
---------------------------------------------------------------------------
    \33\ Some provincial and prefecture governments set up and enforce 
quotas for shipping in goods from outside. Chen, Dongyou ed., Zhongguo 
nongmin (Chinese peasants), Nanchang: Jiangxi Gaoxiao Press, 1999, 206. 
Even the official journals start to list various ``striking'' cases of 
regional and local protectionism that damages law enforcement and 
market development. Dadi (Earth), Beijing, no. 101(May 2001), 46-47.
    \34\One early effort was the State Council's Directive on Breaking 
down Regional Blockade of the Market, Nov. 10, 1990. A later such 
effort was the almost identically titled State Council Decree 303 of 
Apr. 12, 2001.
    \35\ Hu Angang et al. 1995, 27-31, 90-97, and 258-78; Minxin Pei, 
``China's Governance Crisis,'' Foreign Affairs, Vol. 81-5, September-
October, 2002, 96-109.
---------------------------------------------------------------------------
    Consequently, the hukou system had twisted the Chinese social life 
to create a peculiar horizontal stratification. This system may have 
provided organization and social stability to a large nation, 
especially in a time of rapid economic development and social and 
cultural change. It forms solid groupings and associations beyond 
family and employment relations. Ethically, however, institutional 
exclusion produces troubling questions about the equity and equality of 
the human and civil rights of citizens of the same nation. A slow 
urbanization naturally segregates the citizens and creates cultural 
biases against the excluded rural population.
    Furthermore, institutional exclusion discourages and even hinders 
the development of creativity and ingenuity that often accompany 
people's horizontal and vertical mobility in a society. Chinese 
culture, social stratification, and social norms and values have all 
developed regional characteristics as well as a rural-versus-urban 
differentiation.
    The excluded Chinese peasants still by and large accept their fate 
under the PRC hukou system as it is. The extent to which those who are 
excluded in the rural and backward areas, three-quarters to two-thirds 
of the total Chinese population, will continue in their role as the 
reservoir to hold the unskilled millions, hence to make a 
multigenerational sacrifice for rapid modernization of the Chinese 
urban economy, remains increasingly uncertain. Unemployment pressure 
alone, likely to be significantly worsened by China's new WTO 
membership, may make hukou-based institutional exclusion even less 
bearable. The hundred-million-strong migrant (liudong) 
population'*registered holders of temporary hukou and unregistered 
mangliu (blind floaters)'*clearly a second-class citizenry outside 
their home towns in their own country, has already become a major 
source of the rising crime rate and even of organized crime in the 
PRC.\36\ How much and how quickly trickle-down and spillover effects of 
prosperous, glamorous urban centers will be felt in rural areas will be 
key to the continuation of China's sociopolitical stability.
---------------------------------------------------------------------------
    \36\ Li Zhongxin 1999, 11-13 and 23-24.
---------------------------------------------------------------------------
    How long a hukou-based rapid but uneven economic growth can last, 
at the 
expense of excluding the majority of the population, remains a 
legitimate and 
profound question. Another leading concern is the running-away of 
vertical and horizontal social stratification of Chinese society. The 
combination of these two stratifications not only has affected the 
allocation of resources, opportunities, and life chances in general for 
every Chinese, but also has largely shaped Chinese values, behavioral 
norms, and culture that are not conducive for rule of law, equity of 
human rights, or individual freedom. A small, elitist, urban hukou 
holders living in major urban centers, are masters of this people's 
republic at the expense of excluding and discriminating against the 
majority of the people, who are growing in discontent and rightfully 
angry.\37\
---------------------------------------------------------------------------
    \37\ Incidentally, among my interviewees, privileged urban dwellers 
tend to take the PRC hukou system for granted and assert that the hukou 
system ``really does not make much difference in life,'' while the 
excluded ``outsiders,'' especially the ruralites, insist that the hukou 
system affects their lives personally and persistently.
---------------------------------------------------------------------------
    Clearly, the PRC hukou system right now poses serious ethical, 
legal, and international questions that demand creative and effective 
solutions. The hukou system has systematically created barriers against 
labor mobility, thus limiting the rationalization of a young market 
economy there and perpetuating poverty for the majority of the 
population living in the rural areas as the excluded under unfair 
treatment and naked exploitation. The lack of genuine vertical and 
horizontal mobility, in addition to the lack of freedom of speech and 
individual and property rights, has seriously impeded creativity and 
innovation in China. The system contributes to the growing 
regionalization of the Chinese political economy with profound 
consequences for the Chinese economic development, the capacity of the 
central government, and even the unity of the Chinese nation.
    Yet, to Chinese leaders, the hukou system still appears to be a 
familiar, important, reliable, and effective statecraft. Currently, 
much of this system is still largely internalized as a part of the 
Chinese culture and enjoys a high degree of legitimacy, even among the 
excluded. Obviously, the hukou system relies heavily on the political 
power of the CCP to continue; yet the functions of the system have also 
become highly critical to the stability and continuation of the CCP 
political system. Mounting tensions the system brews and the resultant 
scrutiny and criticisms are likely to force more changes as the PRC 
state may have to retreat further. Ultimately, the fate of the hukou 
system will reflect and determine the fate of the current PRC 
sociopolitical order and China's chance of realizing its enormous 
economic potential.
                                 ______
                                 

                 Prepared Statement of Chloe Froissart

                           SEPTEMBER 2, 2005

    I would like to take the example of migrant children's access to 
education as an illustration of the institutional exclusion created by 
the hukou system as described by Professor Wang in his book.\1\ My 
presentation will mainly draw on the fieldwork I have been carrying out 
for four years in Chengdu, capital of Sichuan province.
---------------------------------------------------------------------------
    \1\ Fei-Ling Wang, Organizing Through Division and Exclusion, 
China's Hukou System, (Stanford: Stanford University Press, 2005).
---------------------------------------------------------------------------
    I will first recall the impact of the hukou system on migrant 
children's access to education as it appeared at the beginning of the 
2000s and is still prevalent now. But as education is a determining 
factor in a country's development and involves individuals' rights as 
much as state's interests, there has been room for many recent 
improvements. I will thus give an overview of these developments as 
well as the forces at stake in the evolution process by citing concrete 
examples, and I will finally endeavor to weigh the impact of the 
reforms.

    THE IMPACT OF THE HUKOU SYSTEM ON MIGRANT CHILDREN'S ACCESS TO 
                               EDUCATION

    Despite the fact that China recognized in its Constitution (1982) 
the right to every citizen to receive an education and in 1986 
introduced in its legislation a system of compulsory education lasting 
nine years for every child from the age of six or seven, the 
administrative system of the hukou still prevails over the legislation 
and prevents migrant workers' children from receiving a proper 
education.\2\ According to this system, belonging to society is still a 
function of one's place of registration. Local governments guarantee 
the education of children, like all other social rights, only for their 
own constituents, resources being allocated according to the number of 
permanent residents. Migrants' children were completely excluded from 
urban education system until 1998, when they gained the right to enroll 
temporarily in urban schools on the conditions of being registered with 
a host of administrative organs and paying ``Temporary Enrollment 
Taxes'' that could reach several thousands yuan a year. As the vast 
majority of the migrants are illegal immigrants who cannot afford such 
high schooling fees, private schools, sometimes set up by migrants 
themselves, started to spring up in response to the needs of these 
children in the major urban centers in the mid-1990. In return of very 
low enrollment fees (300 yuan a semester for the first year of primary 
school in the mid-1990, 600 yuan now), pupils had to put up with 
deplorable sanitary, security and teaching conditions. Moreover, as 
most of these substandard schools have no legal status, they cannot 
award certificates for courses completed, which is a considerable 
problem when the students wish to re-enter a state school or have the 
level of their studies recognized for the purpose of finding a job. 
Established out of the control of the state, these schools are 
routinely banned and demolished without the authorities worrying about 
placing the children in other schools.
---------------------------------------------------------------------------
    \2\ China also ratified the United Nations Charter on the Rights of 
the Child and signed--but not yet ratified--the International Covenant 
on Civil and Political Rights, both of which mention the right to an 
education.
---------------------------------------------------------------------------

                             PUBLIC OUTCRY

    Education is not only an ethical question that recently 
crystallized the debate over citizenship in China; it also involves 
economic development and social stability, which are of great concern 
to the Chinese state. This is the reason why Chinese authorities were 
particularly receptive to the public outcry over this issue. Following 
the rising number of migrant children in the cities (two to three 
million in 1996, seven million now), solving their education problem 
became increasingly urgent. Over the past few years, this problem 
triggered a public outcry supported by scholars, journalists and also 
some political figures and organizations that warned against the 
economic, social and possibly political price the country might pay in 
a near future if this social injustice was not addressed. Preeminent 
scholars, some of whom belong to government think tanks, have over the 
past few years, published detailed reports submitted directly to the 
government.\3\ Scholars' concerns have been echoed by some political 
figures. In 2002 and 2003, Chinese People's Political Conference 
members and National People's Congress representatives, especially the 
Communist Youth League, warned that if migrant children remained on the 
fringe of society and were not equally treated it would generate 
resistance to society. At that time indeed, many reports showing 
increasing criminality and delinquency among migrant workers were 
released. I also noticed through my fieldwork inquiries that migrant 
workers whose children faced unfair treatment tended to question 
hukou's legitimacy, saying that they were ``Chinese citizens'' or 
``Sichuanese citizens'' just as urban dwellers and should be treated 
equally. At that time, the press started to support this point of view 
by publishing papers mentioning the need of equal treatment among 
citizens, especially as far as education was concerned.
---------------------------------------------------------------------------
    \3\ For example, Han Jialing of the Institute of Sociology of the 
Beijing Academy of Social Science published in 2001 an outstanding 
report called ``Research report on the situation of migrant children of 
compulsory school age in the municipality of Peking'' that had a great 
impact on Chinese authorities, but Wang Chunguang from the Chinese 
Academy of Social Sciences, as well as Cui Chuanyi and Zhao Shukai of 
the State Council's Research Center for Development also did a great 
amount of research and lobbying work.
---------------------------------------------------------------------------
                    EVOLUTION OF THE CENTRAL POLICY

    As previously mentioned, the central state first acknowledged the 
necessity for migrant children to receive an education in 1998. In May 
2001, the State Council published a Decision on the Reform and the 
Development of Basic Education, that mentioned the need to take account 
of the education of migrant children by making their acceptance in 
public schools a priority. But this document did not address the 
problem of temporary enrollment fees. In August 2002, the Chinese 
Ministry of Education convened a working session mainly devoted to the 
problem of private schools and called upon local governments' 
responsibility in better controlling and supporting these schools. 
However, these were more symbolic acknowledgments of the problem 
without any precise or compulsory directives and had little impact.
    A major step forward was made in January 2003 with the issuing by 
the State Council of the Ruling on Successfully Managing the Employment 
of Rural Farm Workers in the Cities and their Access to Public 
Services. This document carried a clause stipulating that ``the right 
to compulsory education for children of migrant workers must be 
guaranteed.'' Local governments are required to take steps so that 
these children can enjoy the same teaching conditions in state schools 
as city 
residents do and support any ``substandard schools'' by bringing them 
into the development plans for education and helping them to improve 
their material and pedagogical conditions instead of eliminating them. 
Finally, urban governments are 
required to devote a part of their budget to the education of these 
children. In September 2003, the State Council issued a more detailed 
document\4\ providing that governments of destination cities will be 
responsible for the nine-year compulsory education of the children of 
migrant workers. The education of these children should be included in 
the general social development plan of the cities and local governments 
should channel more funds to run public schools where migrant children 
should be mainly enrolled. Private schools should benefit from 
preferential conditions to obtain permits and enjoy special support and 
monitoring from local authorities.
---------------------------------------------------------------------------
    \4\ Propositions for Improving the Work on Compulsory Education of 
Children of Migrant Workers in the Cities.
---------------------------------------------------------------------------
    Migrant children's access to education was made a main topic of the 
annual session of the NPC in March 2004 by Prime Minister Wen Jiabao. 
In February, in the wake of the session, all the media were told to 
report on the issue. This actually saved many private schools that were 
bound to be banned, such as Doushi School in Chengdu. This school, 
located in Jingniu district, opened its doors after the Chinese 
Festival holidays and immediately received a notice of closing issued 
by the district government. The parents of the 200 children already 
enrolled in the school spontaneously contacted the local press that 
published an article entitled: ``Closure of Illegal School Leaves 
Migrants' Children Wanting To Be Treated as Citizens'' \5\ and stressed 
local authorities' responsibility in providing education to migrant 
children. China Central Television read the article and went to Chengdu 
to shoot a report on the school, followed by local television stations. 
The ban was immediately revoked and the school was promised to obtain a 
license very soon. The 2004 annual session of the NPC made two 
important decisions to improve migrant children's access to education: 
first it proposed to inscribe in the Constitution migrant children's 
right to receive an education and second it announced the suppression 
of the Temporary Enrollment Fees in September 2004.
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    \5\ Tianfu Zaobao (Tianfu Morning Paper), February 10, 2004.
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 ENFORCEMENT OF CENTRAL POLICY AT THE LOCAL LEVEL: THE CASE OF CHENGDU

    Chengdu municipality followed quite well the central guidelines and 
did a lot recently to improve migrant children's access to education. 
These improvements are due to favorable political conditions in the 
Sichuan capital. First, as more than 90 percent of migrant workers in 
Chengdu are coming from Sichuan province, the municipal government's 
administrative responsibility toward Sichuanese migrants is much 
stronger than the responsibility of big cities toward migrants from all 
over China. At least, the provincial government can put pressure on the 
municipality and compel it to better protect migrant workers' rights. 
For this reason, conditions for migrants have been traditionally better 
in Chengdu than in big coastal cities. Second, Chengdu First Party 
Secretary Li Chuncheng made the ``unification of urban and rural 
areas'' the new motto of Chengdu municipality. During a public 
appearance on September 1st, 2004 he said this ``unification'' not only 
means that peasants are to become urban citizens but also that equal 
rights should be granted to them as far as social and medical 
insurance, schooling and employment opportunities are concerned. 
Finally, Chengdu scholars have been very much involved in promoting 
migrant workers ``citizenship rights.'' Namely researchers from the 
Institute of sociology of the Sichuan Academy of Social Sciences set up 
a ``Network for Social Support to Chengdu Migrant Workers'' in 2002 in 
collaboration with the provincial Women's Federation and UNESCO. Their 
commitment in lobbying the authorities and in rising public awareness 
on this issue undoubtedly had a significant impact. Scholars managed to 
rally the support of the local media by convening regular meetings with 
journalists to explain to them the situation of migrant children. In 
2004, they even launched a book collecting campaign and organized 
social activities for these children in collaboration with local 
newspapers and renowned companies. The result is that press reports now 
systematically support the interests of migrant children and almost 
always side with migrant schools whereas they use to voice local 
authorities' views in the past.
    However, there are always discrepancies between the general and 
ideal principles devised by the central state and their local 
implementation. As we will see, new public policies in Chengdu do not 
aim to accommodate all the children equally: as the fault line between 
urban and migrant children is still maintained, a new tiered management 
between different kinds of migrant children also appeared. Let's 
consider how Chengdu municipality implemented the three central 
guidelines of enrolling migrant children in public schools, suppressing 
the Temporarily Enrollment Fees and enhancing the management of private 
schools.

Migrant children's enrollment in state schools
    In December 2003, Chengdu government announced that a public school 
for migrant children will be opened in each of the five urban districts 
within two years and that the municipality will invest 20 million yuan 
to support the financing of these schools by the district governments. 
In fact, only two new schools were opened, the rest are urban schools 
that were enlarged to receive children of non-Chengdu hukou holders who 
can not be considered as migrant workers (often white collar workers 
from other cities). Honghuayan School in Chenghua district was the 
first to open its doors in September 2003 and can be held as a model. 
Its early opening was driven by the high concentration of migrant 
children in this district and the necessity for the local authorities 
to compete with the growing number of illegal private schools. It 
provides schooling for the whole compulsory education period from the 
first year of primary school to the third year of middle school. In 
October 2004, the school had 1464 students and 54 teachers. The 
district government invested 3 million yuan in the school and pays the 
teachers, who are transferred from urban schools. Thanks to these 
public investments, schooling fees are very low: 302 yuan a semester 
for primary school and 491 yuan for middle school. Although the 
material conditions are of lower standard than the ones of the schools 
for urban children (buildings are prefabricated, the school's acreage 
is to small for the number of its students, lack of computers etc.), 
teaching and security conditions meet the urban standards. The school 
can of course confer state certificates, but many pupils do not have 
the required level to pass the exams.
    School enrollment is subject to the condition of having the ``three 
certificates:'' hukou booklet, temporary residential permit and the 
work contract of one of the parents. A tax bill is also sometimes 
required.
    Wuhou district opened Jinghuazheng School in September 2004. The 
school only provides primary education and has three kindergarten 
classes. It received urban pupils\6\ months after its opening, likely 
because it was not financially sustainable. Thus, among its 1331 
primary students, only 467 were migrant children in November 2004. 
Among its 51 teachers, some come from urban schools, others are 
trainees or do not have the credentials to enter better urban schools. 
The district government invested 4 million, which enables this school 
to have slightly better material conditions than Honghuayan, but the 
schooling fees are higher: 551 yuan a semester for primary school. 
Migrant pupils who do not have the three certificates (which means most 
of them) have to pay 223 yuans more each semester. The ones who have 
the three certificates do not need to pay these ``Temporary Enrollment 
Fees'' since their education budget is transferred by the 
administration of their village of origin to the urban district 
administration and can cover part of the education costs in the city. 
Computer lessons are charged separately, although the fees are very low 
(30 yuan a semester). This school is thus more expensive than the 
previous one, does not cover the whole compulsory education period and 
have potentially slightly less qualified teachers but has the advantage 
of mixing urban and migrant children.
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    \6\ These pupils are in fact children of former peasants leaving in 
Chengdu suburbs who recently obtained an urban hukou (nongzhuanfei), 
that is why mixing these urban children with migrants is less 
problematic.
---------------------------------------------------------------------------
    From these two examples, we can see that lack of public funding and 
teachers still remains the main obstacle to migrant children's equal 
access to education. Very few pupils can enroll in the public schools 
created for them. Conditions at these schools are lower than the urban 
ones and also vary from a district to another according to local 
government budget.

Suppression of Temporary Enrollment Fees
    Starting from September 2004, Chengdu municipality exempted some 
children from paying Temporary Enrollment Fees. The most recent 
conditions\7\ to meet in order to benefit from this policy were to 
apply for a ``Certificate of Entitlement to Compulsory Education for 
Children of Migrant Workers'' with the street committee to which one 
belongs. To obtain this certificate, one has to provide the following 
documents: temporary residential permit smart card of one of the 
parents and of the child, original of the hukou booklet of one of the 
parents and of the child, recent labor contract, employment certificate 
and salary slip, proof of registration with the Labor and Social 
Security Bureau at the municipal and district level, tax bill, 
schooling certificate of the previous year and school transfer 
certificate. These conditions are of course too high for migrant 
workers, most of them working in the informal economic sector, not 
having work contracts or high enough salaries to pay taxes and being 
usually not registered with any administration. Even urban people 
cannot, most of the time, meet these conditions. This policy in fact 
benefited white-collar workers from other cities or the wealthier and 
more stable among the migrants' elite, who thus had an incentive to 
legalize their situation. However, official statistics show that quite 
a significant number of ``foreign'' children benefited from this 
policy. According to an official in charge of education in the Chenghua 
district, in October 2004, 17,000 children were exempted of Temporary 
Enrollment Fees in this district. According to a press report,\8\ 
Jingniu district government allocated 2.5 million yuan for compulsory 
education subsidies to exempt 13,867 migrant children from paying 
Temporary Enrollment Fees, 89.64 percent of them were enrolled in 
public schools.\9\ For those who cannot produce these certificates, 
Temporary Enrollment Fees still amount between 800 and 1,600 yuan a 
year in primary school and 2,000 to 3,600 yuan in middle school 
according to the standing of the school and the class attended.
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    \7\ Published in May 2005.
    \8\ Tianfu Morning Paper, December 10, 2004.
    \9\ However, we should keep in mind that official statistics are 
often not reliable. For example, according to the municipal 
authorities, there are 1.5 millions outsiders in Chengdu, 80 percent of 
whom are migrant workers. Among their 70,000 children, 50,000 are 
enrolled in public schools and 20,000 in private schools. The first 
figure is certainly exaggerated and should encompass children of 
outsiders who cannot be considered as migrant workers. Besides, 
according to my interviews, one of the most famous principals in 
Chengdu (Mr. Zhou Yongan) set up eleven private schools that have 
already enrolled 20,000 children and a few other private schools enroll 
several thousands children each (Caiying School has around 6,000 
pupils). I estimate the number of children enrolled in private 
migrants' schools at 40,000.
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Migrant children's private schools management
    Because public education still remains beyond the reach of migrant 
children, the vast majority of them are enrolled in private schools 
that are around 70 now, up from 10 two years ago. In September 2004, 
Chengdu government acknowledged that the financial efforts it could 
bare to enroll these children in public schools were insufficient\10\ 
and announced that it would closely monitor twenty private schools 
without permit to help them to improve their conditions. The ones that 
would meet the standards after the trial period would receive a 
license. But very few schools were legalized. At the beginning of 2004, 
only five schools had a permit, they are now less then ten. In fact, 
the local authorities' position toward these schools did not change. 
They are reluctant to channel more funds and appoint more staff to 
monitor these schools, they are apprehensive being held responsible in 
case of accident or if school directors turn out to be conmen. Above 
all, they are very hostile to schools that look dreadful and are 
perceived as an element of depreciation in the urban landscape. A good 
indicator of the lack of public commitment toward these schools is that 
Chengdu municipality has still not issued directives to which private 
schools for migrant children should abide to obtain a permit. Once the 
spotlights of the NPC Congress were turned off, Doushi School was never 
granted a permit and was even demolished last May after a developer 
bought its plot.\11\ Many other private schools, and even Honghuayan 
public School, are bound to face the same problem in a near future: for 
local authorities, economic development prevails over migrant 
children's education.
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    \10\ According to official figures released by Chengdu authorities, 
the municipality spends annually 2,000 yuan on each pupil of compulsory 
school age. Based on 70,000 migrant children to be enrolled in public 
schools, the municipality has to increase its education budget by 140 
million yuan in a year. Chengdu also lacks teachers, who are only 3,000 
according to the number of children permanently registered.
    \11\ Land in China still mainly belongs to the state but 
authorities now start to sell it to developers. Hence, owning real 
estate is not a guarantee against expropriation.
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        assessment of the impact of the reforms and their limits
    Public policies in favor of migrant children's access to education 
do not eradicate the impact of the hukou system but enable a more 
flexible management of this system. These policies first benefit to the 
children of the wealthier, most stable and legally registered 
``outsiders'' who are held to contribute the most to the economic 
development of the city, but many of whom cannot be considerate as 
migrant workers stricto sensu. Chinese rural migrants are thus treated 
in their own country in a very similar way to foreign immigrants in the 
United States, who can be granted with a green card according to their 
merits and the tax amount they pay. Public policies in favor of migrant 
children schooling--just like many other recent policies targeting 
migrant workers--thus function as a tool to filter this population and 
control urbanization by deliberately excluding the poorest and the 
transients. Whereas this reform does not erase completely the 
difference of treatment between urban and migrant children, it has a 
noteworthy consequence: it creates a tiered management of the migrant 
population and thus generates new social stratifications within this 
social category. We now can distinguish five categories of children 
with different access to education:

          1. Those who are integrated in urban public schools because 
        their parents can afford paying the Temporary Enrollment Fees. 
        These children need a temporary residential permit but no other 
        documents.
          2. Those who are integrated in urban public schools because 
        they were 
        exempted from paying the Temporary Enrollment Fees. In this 
        case, economic discrimination has been apparently replaced by 
        more stringent administrative discrimination (see supra the 
        list of documents that have to be provided), but in fact the 
        conditions to meet in order to enjoy fees exemption favor the 
        wealthier migrants. Children belonging to these first two 
        categories receive the same education as urban pupils but are 
        still discriminated against, whether economically or 
        administratively, not mentioning popular discrimination.
          3. Those who are enrolled in substandard public schools. 
        These are the children of legally registered and quite wealthy 
        migrants since a work contract and sometimes also a tax bill 
        are required to register in these schools. But the list of 
        documents to be provided is not as long as the one required to 
        enter a public school for urban children.
          4. Those who are enrolled in licensed private schools. These 
        children do not need to be legally registered but tuition fees 
        are higher than in public schools for migrant children. 
        Children belonging to these last two categories do not enjoy as 
        good conditions for education as urban pupils from whom they 
        are generally segregated. However, pedagogy in these schools 
        often better match the needs of these children. At least, their 
        education has official recognition and they can receive course 
        certificates.
          5. The vast majority of those who are enrolled in illegal 
        substandard private schools. These are children of poor and 
        illegal migrants. They pay more than the children of categories 
        2 and 3 enrolled in public schools and are not receiving a 
        proper education.

    This typology clearly illustrates one of the key points made by 
Professor Wang: institutionalized discrimination anchored in the hukou 
system remains while being now coupled with discrimination between the 
haves and the have-nots. The children who receive State's support are 
the wealthier and better integrated while the needy children are still 
denied proper schooling and will likely go back to the countryside to 
continue their education. The reforms hence nurture social 
stratifications and rural-urban socio-economic imbalances.
    I should also mention that the children who are enrolled in public 
schools thanks to state subsidies are only temporarily integrated until 
the end of the compulsory education period. Entering high school is 
subject to very high tuition fees and Temporarily Enrollment Fees, and 
very few migrant children can afford it. Even those who can complete 
high school in urban areas will have to go back to their villages to 
take the university entrance exam, which is much more difficult than in 
the cities, as Professor Wang demonstrates in his book.
    Reforms thus do not acknowledge education as a universal right and 
do not fundamentally call the hukou system into question. The 
proposition made by NPC representatives in March 2004 to inscribe in 
the Constitution and in the law migrant children's access to education 
as a personal right to be granted wherever they are living was not 
followed up with any effects. Both central and municipal governments 
are opposed to this idea. The central government disagrees because it 
would have to greatly increase its education expenditures. Indeed, the 
cost of migrant children's education in the cities could not be simply 
covered by the transfer of education budgets from the villages, these 
budgets being much lower than the urban ones. Municipal governments do 
not favor this proposal because they do not want cities to be flooded 
with migrant workers who will increase their expenditures and generate 
the economic blockages analyzed by Professor Wang.

                            RECOMMENDATIONS

    A lot of progress has been made in only two years as more children 
who are not urban residents can now receive an education. However, the 
issue is still exposed to institutional blockages and will not be 
thoroughly solved without bold political and administrative reforms, 
namely the abolition of the hukou system followed by corresponding 
taxation and redistribution reforms.
    However, in accordance with its international and domestic 
commitments to fully realize the right to education, China should stop 
using restricted access to education as a way to control urbanization. 
Given its actual administrative system and limited financial resources, 
China must take the following practical steps to address the 
discriminatory treatment faced by migrant children:

    (1) To allow the existence of private schools for migrant children 
and subject them to state monitoring. It is the duty of the state to 
regulate the adequacy of administration, teaching and content of 
education offered by these schools and to prevent them from 
mercantilism. Furthermore, providing monitoring and support to private 
schools is financially less demanding than to accommodate all the 
migrant children in state schools or setting up new public schools for 
them. Central and local governments should expeditiously draft clear 
and consistent regulations under which migrant schools that can meet 
certain basic criteria can quickly, cheaply and easily obtain legal 
status. Governments should provide support to these schools to help 
them meet the same standards of those available in the state schools.
    (2) To reverse the education's decentralization policies that took 
place in China during the 1980s and the 1990s, and thus recentralize 
education expenditure in addition to substantially increase resources 
for education.\12\ One of the reasons why only wealthy and stable 
migrant families can have access to education is that allocation of 
resources is still decided locally depending on the number of people 
legally registered. Recentralization of education expenditure should 
follow the acknowledgment of increased mobility among Chinese people 
and enable them to choose the 
location of the schools their children will attend. Recentralized and 
increased expenditure for education is the only means to insure that 
education is granted as a personal right, and should not depend on the 
status of the parents, such as whether they have any ``out-of-plan'' 
children or possess the required permits.
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    \12\ The Chinese state currently allocates only 2.5 percent of the 
GDP to education, which represents one of the lowest rates in the 
world.
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    (3) Special warning: One of the reasons cited by the authorities 
for putting migrant children into special classes or ``simplified 
schools,'' which are generally of lower quality, is that the children 
have not achieved the same academic standards as their urban 
counterparts. Such a reason--a function of the low level of funding 
provided to rural schools--should not be used as a means to 
discriminate against migrant children. These special schools or classes 
sometimes are a way to adapt teaching to the needs of the students. 
However, they also continue segregation against them and encourage 
further popular discrimination.

                                 
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