Seeds of Fury

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For their part, local governments complain they are under extraordinary fiscal pressure. In 1994, the central government tried to reassert its authority through a reform that funneled tax revenue to the capital, which would then disseminate the money, instead of leaving localities to collect and allocate it. The reform may have given Beijing more money to, say, send a man into space, but regional officials contend they are being shortchanged. "Local governments have lost major income sources, yet they still have to shoulder responsibilities for social services," says Xia Yongxiang, a professor at Suzhou University. To complicate matters, local officials' promotions are tied to high rates of growth or foreign investment, rather than the provision of adequate social services. No surprise, then, that public-health spending in China dropped from 4.2% of GDP when the tax reforms began in 1994 to 2.8% in 2002. Beijing's recent decision to abolish the rural tax will leave local governments with even less to spend on basic necessities, though the central government promises to defray some of the costs. To make ends meet, some local bureaucrats resort to charging illegal fees and levies—or appropriating land to lease to foreign investors. In many localities, such creative revenue sources outweigh official budgets.

Peasants wouldn't be so upset if cash from confiscated fields were used to build a new school or fund a river cleanup. Instead, they complain that the money is too often diverted by local officials. Some high-profile graft cases have resulted in jail terms, like the sentencing last month of a Hebei province party secretary to life in prison for ordering an attack that killed six villagers protesting a 2004 land seizure. But few corruption investigations lead to sentencing, not least because officials tend to protect their own. It doesn't help that the Chinese bureaucracy is woefully overstaffed, particularly in rural areas where government jobs are used as a social-welfare system to alleviate unemployment. Just paying the salaries and perks for China's vast nationwide bureaucracy eats up an inordinate amount of total government expenditure. "Chinese officials spend enough public money on eating, drinking and publicly funded cars to build two Three Gorges dams each year," Zhou Tianyong, vice director of the research center at the Central Party School, which helps formulate party thought, told China Entrepreneur magazine.

Beijing has tried to help by experimenting with programs that channel money more directly to the people meant to receive it—one project involves wiring teachers' salaries to post-office accounts instead of leaving pay at the discretion of local officials. But "how do you know the local government doesn't just invent 20 teachers?" asks Anthony Saich, head of the China Public Policy Program at Harvard University. "The higher government simply doesn't trust [local officials] to carry out what they want them to do." Farmers who once placed almost naive trust in the central government's ability to fix problems are also finding their faith dimming. "They had been told that reform was coming, so they were patient," says Philip Brown, an economist at Colby College, who studies rural China. "But now they see that the reforms don't go far enough, and they think: This is what we've been waiting for?" The Chinese media, which has tried to educate farmers on their basic rights, only heightens this disenchantment. "Because the media is semi-official, it propagates a very positive view of the law," says Mary Gallagher, a political scientist at the University of Michigan. "This is partly because the media can't report on the bad things that happen to you and so it over-reports on the good things. And that causes unrealistic expectations."

Villagers in Panlong feel their expectations are hardly unrealistic. All they want is basic justice. Twice, they sent representatives to Beijing hoping someone would listen to their land-dispute case. No one did. Now, they say, the uncensored satellite feed from Hong Kong has been cut, so they have little idea how the outside world views their story. Journalists who try to get close to the village have been detained. The continuing clampdown—and knowledge that surely Beijing must know what's going on—has corroded belief in the benign authority of China's leaders. One embittered Panlong resident asks: "Why would they care about simple farmers?"

Less than 50 km away in the village of Lishan, a farmer named Liang Beidai is one of the growing number who are ready to fight back. Last month, three Lishan residents were injured after protests of land seizures turned bloody, with one high-school student allegedly shot in the head. "We are prepared to die for [our rights]," says protest leader Liang. "The entire village is doomed anyway. We have no money, no job, no land. There's nothing left to be scared of." If angry farmers truly lose their sense of fear, it may ultimately be Beijing that is running scared.