Modernization of smallholders should be the first step of agricultural modernization
Agricultural modernization is a good term. Since 1984, China has been pursuing modernization, and without agricultural modernization, there naturally can be no modernization of China as a whole. Because agricultural modernization is a good term, there is no objection to proposing to accelerate the realization of agricultural modernization, and therefore there is also no objection to state policy support and even fiscal subsidies for realizing agricultural modernization. Under the name of agricultural modernization, various state resources have been invested.
The question now is, what exactly does agricultural modernization refer to? Given China's national conditions at the current stage, where should the focus of agricultural modernization be? Which agricultural modernizations should the state focus on supporting? Which agricultural modernizations should policy guide? And which agricultural modernizations are an intrinsic part of the market itself?
The current general understanding in China is that agricultural modernization is modern agriculture. The 2007 Central Document No. 1 stated modern agriculture as follows: “equip agriculture with modern material conditions, transform agriculture with modern science and technology, upgrade agriculture with a modern industrial system, advance agriculture with modern business models, guide agriculture with modern development concepts, and develop agriculture by cultivating new-type farmers”.
In recent years, the central government's agriculture-related documents have especially emphasized cultivating new-type agricultural business entities, while local governments mostly vigorously promote the transfer of rural land management rights to form large-scale business entities. Government fiscal funds supporting agriculture are also heavily subsidized to agricultural enterprises.
In other words, under the name of current agricultural modernization, agricultural enterprises and new-type agricultural business entities have received the most policy support and agricultural subsidies. Ordinary farming households, because their scale of operation is too small and labor productivity is low, are typical traditional agriculture and smallholder economy, and thus receive no support.
But the question now is that China still has more than 200 million farming households, more than 200 million agricultural laborers, more than 600 million rural residents, and more than 200 million migrant workers who have gone to cities to work or do business. Most of these migrant workers have not truly settled in the cities; their parents and children remain in the countryside, and even after they grow old they will return to the countryside. Therefore, if calculated on the basis of the rural and agricultural population, the current total number of farmers should be more than 800 million, approaching 900 million.
Farmer families of more than 200 million households and more than 800 million people mostly combine part-time work with part-time farming: middle-aged and elderly parents farm at home, while young children work in cities. It is precisely because middle-aged and elderly parents farm at home, have agricultural income and employment, and because the cost of rural living is relatively low, that farmer households have relatively more economic income and live relatively better lives. Without agricultural employment and income, if the whole farmer family moves to the city, the economy will certainly be difficult, and being unable to live with dignity will inevitably lead to serious social problems. In this sense, it is precisely farmers' agricultural employment and income that guarantee the quality of life of farmer families and also guarantee the country's order in development.
Whether farmer families can withdraw from agriculture is obviously not determined by the laws of agricultural development itself, but by China's national conditions at the current stage of development.
China is at the middle-income stage and is very likely to fall into the middle-income trap. At China's current stage of development and its position in globalization, cities cannot provide all migrant workers with stable, high-income employment that allows them to live with dignity, nor can the state guarantee a dignified life for farmers who move to the cities.
Conversely, it is precisely because farmers can still obtain employment and income from agriculture that migrant workers can advance or retreat. If they succeed in the city, they can live with dignity; if they fail in the city, they can still return to the countryside to farm. With agricultural income they can solve the problem of food and clothing, and then plan their next move.
Moreover, it is precisely because farmers who fail in the city can return home that China has a strong capacity to cope with economic cycles. It is also for this reason that China has not seen the large-scale urban slums that exist in developing countries generally.
In other words, China's current stage of development determines that agriculture must provide employment and income for more than 200 million households and more than 800 million people. It is precisely farmers' agricultural employment and income that make the countryside a stabilizer and reservoir for China's modernization, enabling China to maintain stability in development.
As China's economy continues to grow and urbanization further accelerates, more and more farmers will move into cities to settle, but in any case, farmers moving into cities is a slow process, and 900 million farmers will still rely on agricultural income and employment for a long period in the future.
This determines that the pattern of China's smallholder economy will continue to exist for a long time. Moderate-scale business entities will appear, but they cannot replace the smallholder economy in the short term. Calculating on the basis of China's current 200 million farming households and the country's 2 billion mu of cultivated land, the average per household is only 10 mu. If 100 mu per household is taken as the standard for a family farm, the country's 2 billion mu of cultivated land could accommodate only 10 million family farms. Going from 200 million farming households to 10 million family farms is a road that must be walked slowly.
At present, China's 200 million farming households cultivate the most land in China and produce China's most important agricultural product, grain. These households obviously should not be excluded from agricultural modernization; indeed, agricultural modernization must take these 200 million farming households as its main target, must speak up and call for these 200 million farming households, must respond to their difficulties and solve their problems. The state's main fiscal funds supporting agriculture should also be used to solve their problems.
What is bad is that the current state's agriculture-related policies and the general orientation of the media mostly covet the large and seek the foreign, disliking the poor and favoring the rich. Under plausible-sounding worries such as who will farm in the future, they use agricultural modernization to abandon smallholders, and even support capital in defeating smallholders: a typical case is giving various policy support and fiscal subsidies to large-scale operations while abandoning smallholders to their fate.
Against the background of urbanization, under market economy conditions, and with large numbers of rural young and middle-aged people going to cities to work or do business, those who still cannot leave agricultural income and employment are mainly middle-aged and elderly farmers who lack employment opportunities in cities. That these middle-aged and elderly farmers cannot leave agriculture does not mean they can farm well relying only on a single household.
There is a contradiction between small farmers and large-scale socialized production. Whether and how the state can provide basic socialized services for smallholders and solve the common production affairs that they find hard to handle as individual households is the basic precondition for whether smallholders can continue to obtain employment and income from agriculture. Without state support, without basic production conditions, and without socialized services, smallholders will go bankrupt, they will be unable to stay in the countryside, they will be displaced, and they will become the greatest destabilizing force in China's modernization. The main goal of the state's agricultural modernization at present and for a long period in the future is to attend to the urgent needs of smallholders and solve the problems and difficulties of more than 200 million smallholder households.
Only if more than 200 million smallholder households can still obtain employment and income from agriculture, and farmers can still live securely in the countryside, can China's modernization continue to advance with the countryside as its stabilizer and reservoir. At China's current stage of development, agricultural modernization not only cannot be a modernization that abandons smallholders, but must be an agricultural modernization that focuses on serving smallholders, an agricultural modernization that uses modern technology, equipment, information, and organization suited to smallholders' needs to help smallholders.