How Can Farmer Organization Connect with Farmers' Real Needs

Preface

The cooperative economy is a product of economic development reaching a certain level and a certain historical stage. The internet's platform economy has accelerated its transformation and upgrading, yet it remains a closed and limited economic development model rooted in the inherent characteristics of the agricultural industry. The agricultural cooperatives or farmers' associations that took decades to develop in Japan and in Taiwan, China are now facing the challenge of massive inflows of social capital. Perhaps this is a trend, an irreversible tide of cooperation and alliance on a larger platform, and of cross-boundary integration after breaking through traditional barriers. Paradigms originate from the summation of practice, and the existence of a model is inseparable from its inherent ecosystem. Borrowed doctrines need to adapt to the soil of the present. Only by taking root in the soil and embarking on a journey of innovation from the source of demand can we greet the moment of "hoisting the cloud-like sail to cross the vast sea." Today we launch the second in a series of reflections centered on the "farmer question."

I. The Organization of Farmers

Increasing farmers' income and narrowing the wealth gap is key to maintaining social stability and consolidating the foundation of governance. It is also the basis for effectively transforming the rural landscape and achieving harmonious and stable development of rural society. As a strategic industry vital to the national economy and people's livelihood, agriculture - at a time when farmers' incomes are gradually diversifying - has made it a top priority to effectively raise the industrial efficiency of agriculture, improve agricultural returns, and increase the proportion of income from primary industry in farmers' total income. At the beginning of this century, Huzhou City, in accordance with the requirements of road surface hardening, village greening, wall whitening, road lighting, environment cleaning and river dredging, comprehensively advanced rural village environment construction, which triggered the implementation of the province-wide rural environment improvement "Thousand Villages Demonstration and Ten Thousand Villages Improvement" project. At the same time, with a focus on increasing farmers' income from primary industry, it proposed industrial organization - that is, vigorously advancing agricultural industrialization - and farmer organization - that is, raising labor productivity through the establishment of specialized cooperatives for production, sales, agricultural machinery services and so on. As the market-oriented reform of grain and the other reforms it triggered continued to deepen, the degree of farmer organization became the condition for enabling the direct dialogue between the small-scale production of millions of households and the ever-changing large market, drawing focused attention and great emphasis from all sides.

As early as 1949, on the eve of the founding of New China, Comrade Mao Zedong discussed the socialization of farmers, that is, the question of farmer organization. Comrade Mao Zedong pointed out: the serious problem is the education of the peasants. The peasants' economy is dispersed, and according to Soviet experience, it takes a long time and painstaking work to achieve the socialization of agriculture. Without the socialization of agriculture, there is no fully consolidated socialism. The steps toward the socialization of agriculture must correspond to the development of a powerful industry with state-owned enterprises as the main body. Unfortunately, in later development, we borrowed Soviet experience and replaced industrial organization with an administrative organizational system, and replaced economic organizations with political organizations. On October 12, 1983, after the Third Plenary Session of the Eleventh Central Committee, the Central Committee of the Communist Party of China and the State Council issued the "Notice on Separating Government from Commune and Establishing Township Governments." The people's commune system was abolished, and townships were re-established as rural grassroots administrative units. With the abolition of the people's communes and production brigades, agricultural production returned to a state dominated by household management, and the household, the basic production and operation unit in rural areas, failed to grow into a subject of the market economy. The question of farmer organization was once again placed on the important agenda at a new historical stage.

In advancing the building of farmer organization, we proceeded from the actual conditions of agricultural industry development and adopted a two-pronged approach. On the one hand, focusing on the production sphere and around the things that farm households could not do on their own or could not do well when lacking information and technology in developing production, we advanced the building of specialized farmer cooperatives and gradually developed various types of specialized cooperative organizations, including production-oriented, agricultural machinery service-oriented, unified prevention and control-oriented, operation and sales-oriented, and labor service-oriented ones. At the same time, we worked to advance reform of the agricultural science and technology extension system and innovate the agricultural public service system. This promoted the division of labor and specialization in traditional agriculture, with professionals doing professional work, effectively raising the resource utilization rate, labor productivity and land output rate, and steadily increasing the share of income from household management in farmers' income. On the other hand, centering on raising the value-added rate of agricultural product processing, the brand influence of agricultural products, and the market competitiveness of agricultural products and processed products, we adhered to market demand as the guide, gave play to the leading role of agricultural product processing enterprises, and built an organizational system of leading enterprises + specialized cooperatives + farmers, extending the industrial chain to promote the construction of the entire industrial chain, so that farmers could share in the value added at each link of the chain. However, due to the relative lag in reform of the rural property rights system, the lack of a modern spirit of contract, and the failure of farm households to grow into legal subjects of the market, it was impossible in the development of the cooperative economy to establish a corresponding tightly knit interest linkage mechanism, accountability mechanism and legal constraint mechanism. Raising the degree of farmer organization remains a long and arduous task.

II. Farmers' Real Needs

Sorting through the farm households we visited, regarding the development of the agricultural industry, the inner feelings and true thoughts of the farmers made us deeply feel the "harshness" of reality. We summarized them into three types. The first is the worries of the highly ambitious. These households, through more than ten years of production and operation, have mastered trustworthy planting and breeding techniques, possess relatively stable market sales networks, have won a good reputation among consumers, established a moderate operating scale, and have good income expectations and the capacity to expand reproduction. In reality, they seem not to need to expand into new markets, solve new technical problems, or receive more external support and services; their words are full of confidence, with a distinctly ambitious air. Yet they also have inner worries: the contradiction between the state's effective regulation of agricultural product prices and the market-based pricing of labor has led to continuously rising labor costs and an obvious trend of diminishing marginal returns; the extension of the term of land contractual management rights transfer and the confirmation of rights to transferred land contractual management rights have let people see the dawn of stable lease relations, but the basis of transfer is more the mutual affection and mutual dependence of an acquaintance society, and the rights and obligations of both sides lack authoritative legal definition and effective legal protection. Although, with the continuous deepening of reform of the rural property rights system, the rural property rights trading market system has gradually improved, surveys show that the rate of land contractual management rights entering the market for trading is very low, and the rural property rights trading markets that have been built are more limited to transactions of collective assets. The instability of the operating object has become a deep anxiety and an irresolvable worry in the hearts of this group.

The second is the anxieties of the actively enterprising. For the larger grain and oil producers that developed earlier, they have deeply experienced the truth of the saying "only with scale is there benefit." Against the backdrop of the relatively low comparative returns of grain and oil production, various state grain production subsidies have become a predictable and guaranteed source of income. Subsidies are a constant, while operating area is a variable, and the expansion of the variable means higher returns. Therefore, this type of operating entity does everything possible to expand its operating area and enhance its operating capacity. Talking with them, one clearly feels a passion for constant progress and an impulse for constant expansion. They plan how much more land to transfer next year and how many more farm machines to purchase; they calculate how much income the expanded land can add and how much profit space machinery services can bring. As the conversation deepened, we also came to understand the worries behind their constant expansion and enterprise: as labor costs rise, land prices also rise, and continuously rising land transfer prices squeeze profit margins; blindly expanding production scale means the land cannot rest and recuperate, soil fertility declines year by year, agricultural input use remains high, and the land output rate per unit area hovers at a low level. Not only do products, prices and quality lack competitiveness, but the mode of production and business model also lack the possibility of survival and sustainable development. Machinery services likewise face increasingly fierce market competition: individual farmers have limited capacity to invest in buying machinery, small machinery has a limited range of service recipients, and scattered households content with single-season grain production create limited service demand; not investing leaves no way forward, while investing leads to overcapacity and an increase in intangible costs. Behind the surface of active enterprise lies a helpless choice.

The third is the entanglement of part-time agricultural practitioners. The common mentality of part-time agricultural practitioners is that agriculture is no longer their main source of income; it can even be said that income from agriculture is merely a decoration and supplement, meant to avoid the embarrassment of "farmers buying grain to eat." In recent years, as people have attached importance to food safety and become increasingly picky about ingredients, the original land not only carries the hope of realizing value appreciation, but has also become an effective guarantee for a healthy family life, and has even become an object that high-income urban groups compete to lease, bringing considerable returns. In reality, this is clearly shown by the fact that after experiencing a period of rapid growth in previous years, land transfer has entered a relatively stable high-level plateau period in the past two years. From the analysis, our land transfer rate is roughly equivalent to our urbanization level. If we take into account the gap of more than 20% between the urbanization level and the non-agriculturalization level, then if the land cultivated by these part-time workers were transferred, our level of scaled production could reach that of developed countries; if all these people were fully urbanized, our urbanization level could likewise rank among the world's advanced. Our household registration system and related supporting reforms, and the series of policies and institutions we have introduced to advance the integrated development of urban and rural areas, are precisely efforts in this direction. However, the retention of existing rural rights and interests, the continuation of the homestead policy, and especially the advancement of beautiful countryside construction in rural areas in recent years and the improvement of the living environment and living conditions mean that rural areas will become the preferred place for people to live in the future, and both land value and environmental value have huge room for appreciation. Is it better to quickly enter the city and realize the centuries-old dream of becoming an urban resident, or to rush back and forth between city and countryside, waiting for that future, more beautiful dream? Is it better to enjoy the reality directly in hand, or to invest in a beautiful future with an uncertain timeline? Risk and return, investment and profit have woven into an entanglement difficult to escape.