The Coming Crisis of 'Chinese Capitalism'

Historical experience from Brazil, South Korea, and Poland suggested that when a country’s non-agricultural labor force increased to more than 70 percent of the total labor force, the working class was likely to emerge as a powerful political and social force, demanding higher wages, social welfare, and political democracy. China’s non-agricultural labor force currently accounts for about 60 percent of the total labor force and its share has been rising at an annual rate of about 1 percent. At this rate, China’s non-agricultural share of labor force could exceed the critical threshold of 70 percent by around 2020. If China’s current capitalist system fails to accommodate Chinese workers’ demands by then, a general economic and political crisis will be highly likely.