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Permanent residency for the highly educated, highly salaried

May 22, 2014

How can the “public bus” of urbanization get going by only taking years of residency as the standard?

Source: Zhengzhou Evening News, author Mu Xuchong

Although previously large cities like Shanghai and Guangzhou have set up a system of granting residence permits, these do not give access to major social services such as education, medical insurance, and guaranteed housing. The residence permit is not the same as permanent residency, but is just a makeshift device for a transition period. Now many cities have taken the resident permit system as an access point to public services, and as a prerequisite to gaining entrance to the credit system for residency. For many migrants who want to become urban residents, this means crossing over two thresholds, instead of one. They are required to jump over more barriers.

For instance, the “Shanghai residence permit credit method” rule 3 stipulates that only those people with “lawful, stable fixed residences and lawful stable employment” of which the residence permit acts as proof, will be able to enter the credit system, and accumulate additional credits based on their contributions to society.When the credits reach a preset value, the individual can begin to enjoy the benefits of social services.

These stipulations mean that for most people the selection process is harsh. It may not be pleasant to hear, but this is urbanization for the “highly educated, highly salaried.” For example, the two main items of credit for the children of new Dongguaners to enter [public, subsidized]school, is their parents’ academic record and their professional job titles. The contributions of this group [better technical skills, higher income, possession of property, ability to pay taxes] to the city, is considered as payment to allow them access to the city social services. The vast majority of low income workers in industrial and service jobs are blocked from the entrance to urban residency.
It goes without saying, this present urbanization is all about money, it is a “zero expenditure” urbanization [the city wants to get back, from tax revenues and other sources, the amount it spends on increased public services]. This is why those who have become registered permanent residents stands at 37%, and those who have resident permits only is at 53%. Urbanization is very selective about who gets admitted, based on the possibility of repayment. But, looking strictly at the aspect of repayment, what the city does is insufficient. As the city absorbs a vast quantity of migrants, a vast amount of social wealth is engendered, but a portion of this wealth is not set aside and used to create a symmetry between wealth taken in, and that paid out in social services. Instead, the city squanders the wealth in excessive, sprawling development projects, “spreading out the flatbread.”

The big question is who, in the end, is footing the bill for public services? The development committee proposes, “taking those who have residence permits as the vehicle, coupled with those who have lived in the city a fixed number of years, step by step these persons will be urbanized.” From this we can see there is a method of urbanization. On the one hand, they recognize there is a problem with supplying the funds needed and produce a plan to solve this problem. On the other hand, the plan simplifies the situation. By taking the number of years resident in the city as the basic standard, how can they ensure a fair chance for everyone? A top level plan asks, how can we use the dynamic forces already within the city as part of the plan? This is the key.

Although the top level plan (the 12th five year plan) smashes the barriers to registered permanent residency, many more things need to happen. If the volition of the city is used without being forced into a mechanical system, if the social welfare system is made more dynamic, if the restrictions on education are removed, if the market’s “invisible hand” is part of the disposition of subsidies in the plan, then the “public bus” of equitable urbanization will truly be under way.

konjaku: For an explanation of the “new Dongguaners” see


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