In China's richest village, Huaxi, the vilagers are shareholders

Earlier this year, Microsoft's Bill Gates praised China for developing a "new form of capitalism". However, politicians in Beijing call the economic success "scientific socialism" or "socialism with Chinese characteristics."

Huaxi' is the most succesful village in China, and it may become a template for the the future. The Guardian describes the Huaxi model as "shareholder feudalism."

Huaxi is China's richest village. Each family in the village owns a nice home, a car and has $250,000 in the bank. Huaxi provides model for the rest of China and many Chinese travel to the village to learn how it became so successful.

But there is a dark side to Huaxi, too. The villagers work seven days a week and if they ever leave the village, they lose their house, their car and their bank account. All the houses are collectively owned which one might expect in a socialist country, but this is really a form of Chinese eminent domain.

The village elders want to be able to use any property for commercial purposes if necessary. This is the primary reason the villagers don't own their homes.

"Our assets belong to the commune not to the individual," said Sun Hai Yan, a member of the village government. "We have a local saying that your dividend lasts only as long as you stay in the village and the factories keep running."

According to the Guardian The Huaxi system appears to resemble more the old imperial dynasty more than communism. At the top is the ruling family: Wu Renbao. the former village chief, who has been replaced by his son.   Half of the village's main companies are run by village children and grandchildren.

All is not perfect in China's paradise village. There are 30,000 migrant workers who do most of the work in the steel mills and textile factories for about £80 a month. These workers get the same salaries as locals, but they are not shareholders and therefore do not get bonuses and dividends.

In many respects, these migrant workers are more like temporaries in the US.

Would this system work in the US? No. Few Americans would want to function as a lifetime indentured servant working seven days a week with no chance of travelling outside of the village. That is a high price to pay for economic security

It is interesting to see that it is possible to have a successful town that is not dependent on millionaires, billionaires and phony supply side economics.

source: http://www.guardian.co.uk/world/2005/may/10/china.jonathanwatts

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editor: Middle Class Warrior