Summary of Key Points
This article highlights the “special nature” of Taiwanese farmers’ welfare by comparing their living conditions and welfare policies with those of farmers on the Chinese mainland. Taiwanese farmers receive substantial cash subsidies and policy benefits due to the private ownership system and the political leverage they wield as voters. However, the distribution of these benefits is uneven, with some becoming wealthy through the monetization of their land, while landless farmers remain in hardship. In contrast, mainland farmers rely on a collective system that provides them with access to land and other resources, offering a more hidden but systematically guaranteed form of support. The article also discusses the feasibility of raising pensions for farmers to stimulate consumption. In Taiwan, however, this approach has limited effect on those who are already wealthy, indicating a need for targeted measures. Both systems have their advantages and disadvantages, and it is not appropriate to judge them solely based on the amount of cash provided.
I. Farmers on Both Sides of the Strait Are Not Similar: Different Systems, Different Lives
The fundamental difference between Taiwanese and mainland farmers lies in the land system:
- Taiwan’s Private Ownership System: Farmers can buy, sell, and convert their land for other uses (e.g., turning farmland into residential land). Many farmers do not earn their income from farming but from the monetization of their land. For example, the author’s landlord converted farmland into residential property, built two villas for rent, and even made several hundred million Taiwanese dollars from selling two acres of land. Another neighbor grows vegetables mainly to maintain his farmer status and relies on rent for income.
- Mainland’s Collective System: Farmers’ land is owned by the collective, and it cannot be sold freely. However, if they lose their jobs while working in cities, they can return to farm their land, providing a form of “institutional safety net.” Mainland farmers do not risk losing their means of livelihood due to land speculation, whereas 50% of Taiwanese farmers (either landless or semi-self-sufficient) face some of the highest land prices in Asia, with high rents and difficulty in renting land for long-term use.
In simple terms, Taiwanese farmers are often “wealthy owners of land,” while mainland farmers are “ordinary people with land as a form of security.”
II. Why Do Taiwanese Farmers Receive More Welfare? Because They Are Valuable Voters
In Taiwan, farmers are a group that political parties cannot afford to offend for several reasons:
- Voter Leverage: Farmers are concentrated in specific electoral districts, and although they are not a large majority, they can influence election outcomes (similar to how agricultural states are important in the United States). Farmers are highly organized (through agricultural associations and production cooperatives), making them easy to mobilize for voting. As a result, political parties continuously provide them with welfare benefits to win their support.
- Cumulative Policy Benefits: During the Chiang era, policies were implemented to provide farmers with access to land and production resources, and since the democratization, additional cash benefits have been added (such as pensions for elderly farmers and subsidies for not farming). For example, the pension for elderly farmers has increased from NT$3,000 in 1995 to NT$8,110 today, depending on the political situation.
In essence, Taiwanese farmers’ welfare is a result of their role as valuable voters.
III. Diverse but Flawed Taiwanese Farmers’ Welfare
Taiwanese farmers receive a wide range of welfare benefits, with the government bearing a significant portion of the cost:
- Free Benefits: Monthly pensions of NT$8,110 (no contribution required), rice insurance (NT$25,000 per hectare), disaster relief, and subsidies for not farming.
- Low-Burden Insurance: The government covers 70% of health insurance costs and 60% of retirement savings insurance premiums.
- Loopholes: Many farmers who do not solely rely on farming (e.g., work part-time) still receive benefits. Some even pretend to farm to maintain their farmer status and receive subsidies. For instance, the author’s neighbor, who does not farm, enjoys various benefits and drives a million-dollar car.
The result is that those who truly depend on farming may receive little, while those with land take advantage of the system.
IV. Don’t Just Look at the Cash! The “Visible” and “Hidden” Aspects of Welfare
Many people think Taiwanese farmers have better welfare because the cash benefits are more obvious, but mainland farmers’ welfare is more subtle yet substantial:
- Visible Benefits in Taiwan: Direct cash payments and subsidies are attractive, but they are funded by all taxpayers (including salaried workers and businesses). The distribution of these benefits is uneven, with some farmers becoming wealthy and others remaining in poverty.
- Hidden Benefits in the Mainland: Collective land provides farmers with a stable foundation. If they fail in urban jobs, they can return to farm their land, and they can also earn rent from land transfers. This form of support is more stable than cash benefits and is not affected by policy changes.
In summary, while Taiwanese farmers may receive more in the short term, mainland farmers have a long-term security due to their land ownership.
V. Can Raising Pensions Stimulate Consumption? Taiwan’s Experience Suggests Otherwise
Regarding the idea of raising pensions to boost consumption, the situation in Taiwan is as follows:
- Some Farmers Are Not in Need: Farmers like the author’s landlord, who own villas and generate rent, are already wealthy and would not benefit much from increased pensions.
- Those in Need Do Not Receive Enough: Landless or semi-sufficient farmers, who have low incomes and few benefits, would benefit from increased pensions, but they represent a small portion of the population.
- Author’s Suggestions: Instead of raising pensions for all farmers, targeted subsidies for landless farmers would be more effective. Alternatively, issuing consumption vouchers could stimulate immediate consumption. More fundamentally, reducing the urban-rural gap would help, allowing city residents to afford affordable housing in rural areas and reducing their mortgage burdens, thereby increasing their willingness to spend.
In conclusion, stimulating consumption depends on ensuring that benefits reach those who need them; not all farmers benefit from increased pensions.
Final Thoughts: The Welfare Systems of Both Sides Have Their Advantages and Disadvantages
Taiwanese farmers’ system offers more cash and flexible policies, but it suffers from uneven distribution and land speculation. Mainland farmers have a system that provides greater security, but their cash benefits are limited, and the urban-rural gap needs to be addressed. There is no absolute “better” system; the differences reflect the unique structural challenges of each region. The mainland can learn from Taiwanese experiences, such as how to make welfare more targeted, but the two systems are fundamentally different due to their respective scales and frameworks.