In the present rectification of village - and township level administrations, their debts have become the hardest nut to
crack. The most ironic is that the causes of these debts lie in nothing but he crux in this village administration. These debts are new phenomena that have appeared since 1990s, at the beginning of which, in order to solve the general problem of the village authorities' incompetence and slackness, all the higher
governments down to the root - level ones expected to develop rural collective economy to build up their strength. At this period, in the name of founding village - run businesses and adjusting industrial structure, the town - and village - level governments borrowed a lot of money and, as a result, formed the first "basis" of the present debts. The second cause is that, since 1992, under the slogan of "Not Allowing Education and children to be suffered even if the
Government is penny -less", the villages and towns have been forced to hit the target of popularizing the 9 - year education impractically and irrespective of different regions all over China, especially that, around 1996, village and town authorities, who were feeling the high pressure for being checked concerning the said target hitting, were compelled to raise on a large scale capital from the peasants and borrow money from the bank and other resources to build many houses and buildings which should have not been built, making the village and town government more debt - ridden. The third factor is that, because the economic burden on peasants' back is too heavy, which results in the fact that it becomes more and more difficult to collect taxes and fees from the peasants, the village - level governments have to solicit loans with high interest in order to deliver money to the higher - ranking governments; with this interest rate becoming higher and higher, the debts are larger and larger-finally up to the far of the present village organizations.