Little improvement but big problems
According to Li Changping who was a former official and now an agricultural expert, the financial burden of Chinese peasant has been reduced by 120 billion RMB over the past three years. And they receive subsidy of 100 RMB per capita each year, including education, medical services, etc. This is caused by the expenditure by the central government on agriculture, village, peasant and the local government, as high as 100 billion RMB each year. However, the problems with peasant, village and agriculture are still very serious.
First, Chinese peasant's revenue from agriculture is declining. Small peasant suffer serious bankruptcy. They coluld not be able to compete with capitalist farming in the sectors of processing, sales and supply of production materials. They stay in the low-profit sector of production. The foreign owned enterprises of agriculture took over a big share of the markets of several agricultural product. The privatization of finance in rural village further pushes peasant to poverty.
Second, many rural villages are undergoing the process of mafiaization. The local governments collude with corporate groups to further exploit the peasants by monopolizing the local market and expropriating farm land. They peasants could not support a strong force of police and legal officers to crack down upon the local mafia because it would only increase their financial burden.
Third, the small peasant families increasingly rely on pesant workers wages. This has a serious implication. The bankruptcy of rural peasants might results in oversupply of workers and unemployment problem in cities.
Fourth, the peasants and local cadres have neither a channel to voice out their grievances nor an ability to solve their own problems. They have to depend on their connections with people above, the higher-ranking cadres or foreign capital. As Li argues, their dependency is caused by the central government's over-centralized authority in agricultural policy. The local cadres do not dare to experiment on collective economy because they are afraid of being labelled as against "economic reform" or "going back to the old way". Therefore they keep on household responsibility system and prefer to wait for assistance from the central government rather than exploring new ways.
Li suggests to allow the local cadres and peasants to have more autonomy and freedom. It is necessary to decentralize power of decision making and management to the grassroots. What the central government should do is to provide general principles.
Li Changping is widely known by his letter to the former Prime Minister Zhu Rongji about the crisis in agriculture and village in 2000 when he was still a county-level party secretrary. Later he resigned from his position and work in NGOs and academic institutions.