Bucking the Peking trend in rural China

In this bustling, industrial city in the Yangtze River Delta, people have always tried to go their own way. Now that record-breaking prosperity and industrial revolution have come to the region, people are more confident than ever and are enjoying a new-found independence from the government in Peking.

``The people of Wuxi were more clever than Chairman Mao,'' a city official dared to tell a visitor recently.

``During the Cultural Revolution [1966-76], rural enterprises were labeled as a `tail of capitalism' that had to be cut off,'' the official said. ``But that was the very time when rural industries were getting established here.''

Local officials have statistics ready to convince any doubting outsider that Wuxi and nearby counties are in the vanguard of China's rural development. This is a region where per capita incomes are among the highest in the country, they say, and even village-run industries produce export-quality goods.

The record of economic growth is impressive. Wuxi and Jiangyin counties, adjoining Wuxi city, rank first and second out of some 2,000 counties in China in the value of combined industrial and agricultural output. Annual income levels of 2,000 yuan ($540) are several times the national average.

The prosperity is as obvious as the three-story brick houses common in rural settlements along the canals and waterways. Single-family, private homes on such a large scale are rarely seen elsewhere in China.

This year the central government is not interested in economic expansion at any price and is advocating austerity and thrift. Peking has demanded a scaling back of investment in rural industries in favor of state-run projects and again has stressed the importance of grain production. It has encouraged rural saving instead of expenditures for new houses and other so-called non-productive investments.

So far, these changes in direction have not dampened local enthusiasm for profit-taking in industry rather than laboring in the fields to produce food. But it has made people more cautious and protective of what has already been achieved. It has also made it doubly important for them to establish some linkage between industry and agriculture to blunt the criticism that rural industrialization threatens food production, a fear expressed by conservative party leaders in Peking.

Everyone agrees that grain production is important. But there is less agreement about how to find useful employment for the large numbers of surplus laborers in rural areas who are not needed full time in the fields.

As in other parts of eastern China, the exodus from agriculture has been underway for several years. In all of Jiangsu Province last year, 936,000 people gave up farming jobs for other employment. Almost forty percent of the total work force in the province is no longer employed in agriculture.

``Although many farmers have shifted to industry and the service trades, the basis of agriculture is not weakened but strengthened,'' said Shen Zhen Cai, principal economic adviser to the governor of Jiangsu.

Mr. Shen may have chosen to stress this point because of warnings from veteran party leaders in Peking, such as senior economist Chen Yun. Two years ago Mr. Chen openly criticized Deng Xiaoping's reform policies for leading peasants to abandon agriculture for high profits in industry. He warned that if grain production fell as a result, there would be social and political instability.

In Qianzhou township of Wuxi county, some 85 percent of the labor force is employed in business or manufacturing enterprises. Only 5 percent are full-time agricultural workers. In 1979, almost all workers in Qianzhou was employed in agriculture.

``If you have a factory job, then you still have a responsibility for working the land,'' a town official said. Even factory workers have to help in the busy season from late May to early June during the wheat harvest and rice planting and again in September when the rice comes out and the wheat goes in.

The system works well, the official said. Crop harvests have increased with new strains of high-yield rice and chemical fertilizers. By putting idle labor to work, mostly in the textile industry, the region has raised income levels while it has exceeded targets for food production.

Jiangsu officials point out that grain production last year exceeded 1,000 jin (1,100 pounds) per person for the third year in a row and total grain output reached the highest level ever. This record should allay Peking's worries about food, though not every region in China is as fertile as the Yangtze River Delta.

Shen explained that rural industry in Jiangsu was the main source of financing for water irrigation and other projects important to agricultural productivity. The linkage is important both practically and politically.

The boom in rural industry has brought other concerns, too. In Jiangsu, the growth rate of rural manufacturing, construction and service trades slowed to 21-to-29 percent rate last year. Officials say the pace still strains sources of energy, transportation, and raw materials and will be slowed again this year.

In trying to bring industry under control and contain it within the state plan, Peking is often at odds with local government. What is good for the local economy may not suit the commissars of central planning.

Industry is a principal source of tax revenue, for instance. Only 2 percent of Jiangsu's provincial taxes came from agriculture last year, while more than 90 percent derived from industrial and commercial taxes. Some 40 percent of those revenues came from collectively owned industries. This a sizeable contribution from a sector of China's economy that some leaders in Peking are trying to shrink.

Peking is trying to put on the brakes by requiring the provincial government to screen projects. Under new guidelines, so-called nonproductive industries like hotels are discouraged and permits are now required for new industry.