In this guest post Behzad Yaghmaian, author of The Accidental Capitalist: A People’s Story of the New China, speculates on the possibility of a new popular movement arising in China, 23 years after the student uprising which culminated in the Tiananmen Square massacre.

While the Communist Party of China watches the passing of the 23rd anniversary of the Tiananmen Square massacre, it has little fear of the Chinese students as a threat to its rule. More than two decades of enviable economic achievements has made friend out of old foes. The threat comes from workers and peasants. This time however, the Party has a new and largely non-violent approach to this challenge.

After the bloody crackdown of the student movement, Beijing seems to have succeeded in disarming the youth and minimizing the potential for dissent. While reasons for discontent remain, there has been little spontaneous or organized youth action in recent years. The young students who assembled in the square in defiance of the rolling tanks are now prospering entrepreneurs and managers of export-processing factories. They are among the winners of China’s enviable leap forward, and largely silent about the abuses they opposed in their youth.

Born and raised during China’s ascendance to a world power, their children decry politics and youth activism. Political activism leads to “chaos” and steers the country away from the hard gained achievements of development, a recent university graduate told me when I visited China to research the lives of migrant workers. China entered the age of development with noticeable gains for many, including the urban youths.

The situation is, however, largely different for the peasants and the 200 million migrant workers, the most marginalised groups in the country. Across the country, millions of migrants work 10-12 hours a day, earning less than $200 a month. Few have full or partial pension, and even less enjoy unemployment insurance. Despite the massive wealth the country had amassed, nearly a quarter of the households live in less than five square meters per person, and many have no sanitation facilities. In 2008, more than 800 million Chinese farmers survived on an annual per capita income of $570. They lived in mud houses, or brick homes without tap water and heating, and lacked access to healthcare, and other basic needs.

Meanwhile, strikes and job actions by migrant workers and protests by peasants have grown in recent years. Chinese migrant workers are becoming more vocal, demanding a fairer share of the countries riches. Workers protest against unpaid or low wages, workplace abuses, substandard living conditions, or the right to form independent unions are common and spreading.

Government agencies reported 74,000 protests involving 3.76 million people in 2004. “Public order disturbances” reached 87,000 in 2005, ten times larger than1993. According to government statistics, 50,000 to 100,000 protests occurred every year over that past few years. Unlike the 1989 Tiananmen Square protest by the middle class students, those daring to challenge the authorities now are workers and the peasants. Labour disputes rose by 42% in Guangdong in the first quarter of 2009. Across China, there were 317,000 labour dispute cases in 2009 compared to 126,000 such cases in 2006.

Although there are no immediate risks to the government and the Communist Party’s rule, Beijing has been on alert. The government is using a multi-prong approach to deal with the grievances of migrant workers and the peasants.

Wages have sharply increased in recent years. The government-set minimum wage more than tripled from an average of $70 a month in 2005, to $240 in 2012. In many industrial centres, wage increases have surpassed the inflation rate. Beijing has also taken concrete measures to increase access to health insurance and retirement benefits to migrant workers and the peasants. According to a new government plan, all residents in China will have access to essential healthcare by 2020. The plan will particularly benefit migrant workers and peasants.

The government has also supported new laws restructuring workplace relations. A 2007 Labour Law restricts the use of temporary labour, limits the ability of employers to randomly fire their workers, and gives workers the right to collective bargaining for wages and benefits. It also demands all employers to provide their workers with a contract.

Meanwhile, the government is avoiding the use of force in dealing with labour disputes. Government forces remained on the sidelines when workers in the Toyota and Honda plants struck and demanded independent unions and substantial wage increases in late spring and early summer 2010. Beijing’s reluctance to repress the rising wave of strikes in recent years is a turning point in a country known for having little tolerance of labour militancy.

China changed from an egalitarian, but poor society, to one of the most unequal countries in the world in less than three decades. Facing the potential destabilizing consequences of this inequality, President Hu Jintao has called for “development with a human face,” and “building a harmonious society.” The future leadership in China is likely to continue the same policy of maintaining social stability by improving the livelihood of those who paid for economic successes of recent years. The Chinese middle class will expand to include a larger part of workers and peasants.

While minimising the potential for social instability, the enlarged middle class will help create a growing domestic market and consumer society. It would weaken the negative effects of fluctuation in foreign demand. China has everything to win from this policy.