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China's WTO Revolution

China's accession to the World Trade Organization (WTO) is the most important event in the country's history since the inception of its "open door" economic policy a quarter-century ago. Trade liberalization will benefit consumers, small entrepreneurs, and foreign investors. But for China's peasants, WTO membership appears to pose a direct and immediate threat to the tremendous gains made since Deng Xiaoping's agricultural reforms in the late 1970s.

The fear felt by China's peasants is understandable because it is deeply rooted in China's history and politics. Since the founding of the People's Republic in 1949, the peasantry has been the country's most under-represented and manipulated social group, bearing the brunt of the Communists' promotion of heavy industry. But WTO membership does not come at the expense of agriculture, for it promises to erode rather than reinforce the peasantry's legacy of discrimination and powerlessness.

It is a legacy built on deception. During China's civil war in the late 1940s, the promise of land reform attracted tens of millions of landless peasants to support the Communists. After the founding of the People's Republic, they did receive land, only to see it taken back when the new regime embarked on its massive agricultural collectivization drive. The harshness of the subsequent industrialization campaign culminated in the Great Leap Forward of 1958-60, producing a famine that killed 30 million people, mostly in rural areas.

By the time Mao Zedong died, in 1976, the rural economy was a shambles. In desperation, village leaders in Anhui province initiated an experiment that returned land to peasants-a de facto privatization that violated official policy. The government, believing that the situation in the countryside could not get worse, did not stop them. These village experiments with private ownership were highly successful, boosting agricultural output significantly. Indeed, it was the peasantry that fired the first shot in the reform campaign that has transformed China in the decades since.