Here They Come Part 2…China Axing their One Child Policy – ConspiracyOz

Don’t expect a sudden rush of second children in China

Kerry Brown

30th October 2015

The greatest contraceptive in modern China is economic reality. Axing the one-child policy sends a message, but China will have to do much more if it wants to increase its birth rate, writes Kerry Brown.

If nothing else, the announcement at the annual Communist Party Plenum meeting that it is relaxing the so-called one-child policy in place since the 1970s and allowing people to have two children is good populist politics.

This is the listening Party, this announcement says, and it has listened to the emerging middle-class in the cities of China so crucial to the growth of consumption and services (which figured heavily elsewhere in the Plenum) demanding more freedom and autonomy in their lives and done something about it.

Chinese people can now go forth and procreate without fear of heavy fines or official opprobrium.

Only it is unlikely that many will take the offer up, at least as a result of this declaration alone.

Firstly, relaxation of the policy started from the National People’s Congress in 2014 when urban couples who were single children were allowed to have two offspring if they chose. Secondly, there were always many exceptions to the policy – ethnic minorities, for instance, who were always allowed two. Thirdly, plenty have broken the rules and had enough money to pay the fines in recent years. It no longer really operated as a rational policy.

Behind the public noise of this announcement, however, there is a formidable challenge that the Party is trying to face, one that is economic rather than social. As in Japan and Taiwan (whose birth rates among the lowest in the world), China is being hit by a fall in population growth to such an extent that birth rates do not produce enough to replace the current population levels.

China might be the most populous nation in the world, but it is due to hit its peak numbers in the next decades or so and then decline rapidly. For a country that has achieved so much economically through the vastness of its labour supply, this decline before it has produced a more developed, service-based economic model is deeply problematic. When the numbers of people dry up, where will growth come from?

So the government wants people to have more children – within reason – to create sustainable population growth. But here, looking at the experiences of Japan and Taiwan is sobering.

Government campaigns and policies to encourage families to have more children in both of these places have proved largely unsuccessful. There is a very good reason for this. With soaring housing and living costs, and children costing more in terms of education and support, the greatest contraceptive has proved to be economic reality. Hard pressed young couples cannot afford the extra space, the childcare, and the added educational costs. Nor can they rely on their own parents to support them so easily too. It is a similar story across much of the rest of the developed world.

China, or at least urban China, is the same. Real estate costs in Beijing or Shanghai are soaring. Two or three generations of a family are living together not because they want to, but because young married couples cannot afford to buy even the most basic apartments far from the city centre.

Add to this the huge commitment that parents have to give their children in order to get them the best education in a China becoming more and more competitive and pressurized, and it is no wonder that the idea of having twice as much pressure is so unappealing. Many couples in fact are not even having one child, let alone two, or they are leaving it later and later to do so.

The government will have to think hard about providing other incentives to help couples consider having more children rather than just the announcement that people are free to do so. Tax breaks, credits, allowances, etc will all need to be considered. But these are all part of the much more thorny area of constructing a modern welfare state and tax system in a country where, so far, the provision of these things has been patchy. That will be a massive and long process.

This policy change is heavy with symbolism because it seems to bury a series of policies that have become so closely associated with China under Reform And Opening Up after 1978. But it is unlikely they will have any real impact on their own. For other policies that will have this sort of impact, we will need to wait to hear what the fiscal changes are that the government will announce in its 13th Five Year Plan, to be unveiled in full early next year.

The most we can say about today’s announcement is that it is a statement of intent to start looking at this area, nothing else.

Kerry Brown is director of the Lau China Institute and Professor of Chinese Studies at King’s College, London.

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Posted on November 2, 2015, in ConspiracyOz Posts. Bookmark the permalink. Leave a comment.

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