China’s Biggest Problem No One Knows About

=09 =09=09 =09=09=09 =09=09 =09

=09=09=09 =09=09=09=09 =09=09=09=09=09 =09=09=09=09=09=09 =09=09=09=09=09 =09=09=09=09 =09=09=09

=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09

=09=09=09 =09=09=09=09 =09=09=09=09=09 =09=09=09=09=09=09 =09=09=09=09=09 =09=09=09=09 =09=09=09

=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

The Deep End

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09

=09=09=09 =09=09=09=09 =09=09=09=09=09 =09=09=09=09=09=09 =09=09=09=09=09 =09=09=09=09 =09=09=09

=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09=09 =09=09=09=09=09=09=09 =09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

What does population decline mean = for China? Scott Rozelle on a globally invisible issu= e shaping the lives of millions of the country’s rural kids.

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Sean Nangle / The Signal

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

China’s worldwide co= mpetition with the United States regularly captivates global = attention—as with Washington recently shooting down a Chinese spy bal= loon, ongoing tensions over Taiwan, = Beijing’s support for Russia&rsquo= ;s war in Ukraine, or the U.S. administration’s ban on the export of advanced semiconductor chips to Chin= a. But the country’s greatest challenge might now come from withi= n—in its shrinking population. In January, Beijing announced tha= t China’s population had dropped by about 850,000 from 2021 to 2022, = with the total number now at 1.41 billion. Outside demographers have estima= ted for years that the number of people in the country had been declining, = regardless of authorized statistics from the Chinese government. Now that i= t’s official, what are the implications?
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Scott Rozelle&nbs= p;is an American development economist, a researcher at the Freeman Spogli = Institute for International Studies at Stanford University, and the directo= r of the Institute’s Rural Education Action Program, who’s spen= t several months a year working in rural China over the past four decades. = To Rozelle, what’s happening to the country’s population will i= nevitably bring a number of clear challenges, at home and abroad—not = least in Beijing’s economic capacity to care for an aging generation = with fewer children. But “the biggest problem China has that no one o= utside the country really knows about” is most directly confronting i= ts younger generations—in the more remote areas where the majority of= Chinese people live. And in time, Rozelle says, their problem will be Chin= a’s.

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Eve Valentine: Wh= at do we really know about China’s declining population?
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Scott Rozelle: We= know it’s real and serious. Birth and fertility rates are falling fa= st—birth rates being births per thousand people; fertility = rates, births per woman of childbearing age, which is a clearer indicator o= f what’s going on. And looking at the World Bank‘s numbers,&nbs= p;the overall fertility rate in China is down from about 1.7 to about 1.3 i= n six years.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

But then there’s the questio= n of where it’s happening. Western press coverage tends to focus on t= he urban picture: Most urban families have one kid; many have none. Of cour= se, this is a big part of the picture as a whole. But the majority of China= ’s population isn’t falling in the cities; it’s falling i= n rural areas.

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

More than 60 percent percent of ba= bies in China are rural babies. And in rural China, the fertility rate is d= own to about 1.5 from about 2.5 just 10 years ago.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09My research group, the Rural E= ducation Action Program out of Stanford, does a lot of work on rural famili= es, and if you look at a typical sample of them, around 65 percent have two= kids; 30 percent have one kid, without planning to have another; and aroun= d 5 percent have three kids or more—very few anymore.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

At the same time, there was a long= standing historical preference among rural Chinese families for having boys= to work on the farm, and that’s almost entirely disappeared. It&rsqu= o;s true that there’s still a certain cultural bias favoring boys, bu= t people are increasingly happy with girls too. When you speak with a famil= y that has two girls, you’ll often hear, It’s great, we&rsq= uo;ll never have to pay a bride price!—the ceremonial tradition = of a groom’s family paying his fiancé’s.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Now, I don’t know what the b= ride price is going to look like 20 years from now, as the greater number o= f girls in the population get to marrying age. But these days, the bride pr= ice is very, very high—on account of the sex-selection problem from 4= 0 years ago: Between 1980 and 2015, China imposed a one-child policy across= the country, which brought an era of sex-selective abortion that skewed th= e rural population as a whole significantly male.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Valentine: So wha= t’s driving the fall in rural fertility rates now?

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Rozelle: After th= e end of the one-child policy, the main drivers have been the increasing co= st of having—and educating—children and now the decreasing need= for them in rural labor.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09In urban areas, it’s ver= y expensive to raise kids, who haven’t historically been so essential= to family economies there as they have been in rural areas. But in rural a= reas, you don’t really need kids to farm anymore. Chinese farming is = almost totally mechanized now. So while the government in Beijing ended the= one-child policy eight years ago, the incentive to have more children has = actually diminished since.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Rural parents, meanwhile, now tend= to want their kids to be educated and to end up working in an off-far= m sector. Which means a high-school degree, ideally a college degree, and u= ltimately a white-collar job. Which in turn means incurring some of the con= siderable expense urban parents experience in educating their children. And= which ends up meaning that more rural parents want fewer kids—to be = able to focus as much of their resources as possible on those they have. =09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Valentine: How do= you understand the impact of these demographic changes?
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Rozelle: They cer= tainly raise a lot of questions. The most obvious is, are there going to be= enough people in the labor force? Now, I expect that in an era when we&rsq= uo;re seeing more and more applications of robots, automation, artificial i= ntelligence, and so on, we’ll plausibly end up seeing less and less n= eed for human labor across sectors—in construction, for example, or m= anufacturing. We know technology is going to affect the demands on labor in= these industries drastically. But exactly how is a question.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09A deeper question is how China= is going to develop economically overall—specifically, how high Chin= ese incomes will get in terms of GDP per capita by the time today’s w= orking adults become elderly. China has a very, very weak social-security s= ystem, and taking care of the elderly is the main thing they need it for. S= o with an ongoing population decline, supporting that system will depend on= driving GDP per capita up.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

There are related questions about = what China’s global stature will look like over the same time span: W= hat will Beijing be in a position to spend on military expansion? What will= it be in a position to spend on its Belt and Road Initiative?—the gl= obal infrastructure-development strategy it’s used to enhance its inf= luence around the world. If you look at what China spent on Belt and Road i= n 2022, it’s already about a tenth of what it was three years prior.<= br /> =09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

But the biggest issue these change= s are driving is the biggest problem China has that no one outside the coun= try really knows about—a widening gap in what social scientists call = human capital between urban and rural children.

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09In plain terms, this means two= things: One is that China’s education system isn’t adapted to = the challenge of preparing rural kids for life off the farm; it’s not= training them for the emerging economy. But more fundamentally, rural Chin= ese families aren’t adapted to preparing their kids for the challenge= of integrating into the education system in the first place.

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Sean Nangle / The Signal

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

More from Scott Rozelle at The= Signal:

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09“What we find ac= ross the country—and it doesn’t matter if it’s E= ast China, or Central China, or West China, or the semi-rural areas around = big cities—is that there’s a huge problem with cognitive develo= pment among rural kids. It’s nothing genetic, and it has almost nothi= ng to do with nutrition. It’s mainly the result of a psycho-stimulate= d parenting problem.”
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09“They’re c= ognitively delayed essentially because their parents—wh= o love them and want them to go on to college and a good life—are sti= ll raising them as if they were raising a farmer. So they make these kids s= trong, they make them hardy, and they think, When my child gets into sc= hool, they’ll start to learn what they need to know there. But k= ids’ early stimulation is such an important part of their development= , and rural parents simply don’t know how to support this for the wor= ld they want to send their children into.”

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09“That may not be= a problem from Beijing’s perspective as long as t= hey end up putting these kids to work in an iPhone factory. But those jobs = won’t last. And in any event, they won’t help China become the = kind of high-skill, high-income society it needs to become if it’s to= compensate for its declining population over the next decades. That’= ll require creating paths for the emerging population into jobs that depend= on knowledge of science and math and computing and so on. The Chinese are = now in a position where they need to offset the dropping quantity of human = capital with rising quality—and they’re not really doing it.&rd= quo;

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

= Continue read= ing ...

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

The Signal explores urgent q= uestions in current events around the world—to support it and for ful= l access:

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

= Subscribe now

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

This email address is unmonitored;= please send questions or comments here.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

To advertise with The Signal: = ;advertise@thesgnl.com.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

Add us to your address book.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09 Uns= ubscribe here.
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09
=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09© 2023 The Signal =09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09=09=09=09

=09=09=09=09=09=09

=09=09=09