The New York Times reported recently that police and paramilitary troops attacked a village in southern China's Jiangxi Province, killing two residents and wounding at least 18 others on a Sunday morning.

The attack followed three years of confrontations in which villagers in Yuntang refused to pay what they called illegal and excessively high local taxes on their cropland. Residents had erected a steel gate across the only road into the village to block officials from entering.

Disputes over taxes and charges of corruption by local officials reportedly have been common in this part of China, known as the cradle of Mao's Communist revolution. But, they rarely have erupted in gunfire such as that on April 15.

Even as the national economy has been booming, economic conditions have stagnated in the Chinese countryside. Millions of Chinese young people have migrated to the cities in search of jobs. Local governments have raised taxes to try to offset the loss of revenues, but officials and teachers often go unpaid for months.

Long simmering resentment over the taxes apparently came to a head after the Yangtze River flooded in 1998. Although the water reached as high as 8 feet on Yuntang residents' homes and destroyed their crops, officials raised their taxes by one-third. The villagers refused to pay in 1998 and in 1999, when taxes were raised again.

The Times reported that Su Guosheng, a village leader who had complained to Beijing about the taxes and low rice prices, was arrested on April 14. At 4 a.m. the next morning, 600 local police and People's Armed Police assembled outside the village and moved in.

When a crowd gathered to protest the intrusion, police began firing. Reports said the villagers fought back with sticks and rocks.

Losing control of the countryside continues to be a major concern of the Chinese government. When officials announced reforms of the cotton procurement system two years ago, the government moved troops into the major cotton-producing provinces to deal with any unrest.

The reforms included reduced price guarantees for cotton, stocks of which had reached gargantuan levels. Officials hoped that growers would switch to grain crops.

The reforms had little effect. Instead of growing less cotton, USDA estimates China's farmers produced the equivalent of 20 million 480-pound bales in 2000, up from 18 million in 1999. The latest Chinese government forecast projects 2001 production at 21 million bales.

Some U.S. analysts have been projecting for months that China would import 2 to 3 million bales of cotton once the shortfall in Chinese production resulting from the reforms became apparent.

Reports that analysts were lowering their sights on Chinese imports — and the continued problem of certificated stocks — led to May futures hitting a 15-year low on April 20. The May contract closed down 175 points to 44.06. Observers say futures could fall into the 30s before the market improves.

Much is being made of the administration's reliance on trade policy to bring U.S. agriculture out of its current economic malaise. If that's the case, someone needs to find a more stable country to hang our hopes on.


e-mail: forrest_laws@intertec.com