Ok...
I am back from shopping. I will address raj's question. However, I am no historian, politician, nor economist. I will present some information many of you may find interesting. I will try to be accurate but can't guarantee I am totally right.
China's rural infrastructure is like County control Township, Township control Village. Each branch has its own government control its subordinates. China has been in a rush of reform in agriculture as well as industrialization after 1980. Tremendous amount of pressure has been instilled upon the local and rural governments. Many bad habits and old practices from Mao's era also lingered on such as: appropriation of properties for the national and industrial infrastructure improvements, report nonexisting progress for rewards by the representing bodies. Furthermore, to satisfy improvement demands from the provincial or national government, many rural governments instill unauthorized ad hoc taxes to create funds for improvements. With untransparent spending plans, rural tax payers have no ideas how their taxes are being spent: for school, road, or enrich the officials. It opens up many opportunities for corruption and misused funds. people are getting angry about the ad hoc taxes and lack of knowledge on spending of their tax money.
Now, you might ask how did rural governments can create unauthorized taxes. We have to look at how China's rural develop in the past 20 years.
China's rural development is seperated into three zones:Eastern, Central, and Western. Eastern is more of industrial rural area while Central is agricultural rural and Western is more of subsistence (rough). China's rural policy is decentralize one that allows local governement to keep majority of their income for internal development at the local level. This is a heaven for the Eastern rural communities for their natural geographic and climate advantageous. Within a short time, eastern industrial rural became wealthy. their retained income are being used to develop roads, schools and other social programs. However, as time passby, eastern industrial rural communities started to exploit the loop holes in the tax laws by creating many "extrabugetary funds" to evade Tax obligation. Of course, tax contribution went down dramatically especially on many government owned enterprises. To earn extra funding from the governement, many industrial rural communities continue to ask the national governement for money while hiding their true income potentials. Thus, the lesser fortunated areas like Central and Western get even lesser funding from the national budget committees.
For Central and Western rural communities, rough geographic makups make the area far from fast-paced reforms of the east. Generated income from production is far below comparing to its neighbor at the east. Plus, suplement income from the national governement is far from enough for the aggressive reform programs becasue of tax evasion schemes. Local governement tend to add unauthorized ad hoc taxes to fund their improvement projects. With not so impressive production and different fees, naturally rural people are angry about the unfair treatment from the local representing bodies while seeing their eastern neighbors prospering.
Also, China is lack of a system or systems that are capable of calibrate different programs for different area and situation. Many rush of improvements are not carefully plan out for each communities. Thus, you see some many angers towards local governments becasue of their inefficiecies, inflexibilities, corruption, and slow-to-react manner.
The above are just some sum-up problems. The ad hoc tax is a natioanl problem that China's national governement is looking into. The government is also looking into standardize all tax procedures and development policies for rural communities to align its modernization goal. I think the protests are some needed wak-up calls for China to speed up the process.
P.S. sorry it got so long. If you disagree please do ask and speek up. Thanks.
