Postcards From Tomorrow Square (4 page)

If I were China’s economic czar, I would recycle as many of the country’s dollar holdings as possible on grad-school fees in the United States. And if I were America’s immigration czar, I would issue visas to Chinese applicants as fast as I could, recognizing that they will create more jobs, opportunities, and friends for America than the United States could produce any other way for such modest cost. Many Americans will nod along with this point in principle. I would have, too, a few weeks ago. I’m saying that I feel it viscerally now, having met some of these people and begun to see their role in China. And to hear them say that their younger counterparts are going instead to Australia, England, or even Japan because of U.S. visa restrictions makes me want to say: America, wake up and watch out!

CAUTION FOUR:
WATCH OUT, EVERYONE!

It is too bad that “land of contrasts” is such a cliché, for there are situations in which it would be handy. Trying to make sense of the combination of rigid control and the near-complete chaos the newcomer sees in China is one of those.

I don’t mean to sound flip, because one side of this contrast, the regime’s repression and authoritarian controls, is a grave matter. Apart from its effect within China, it is likely to be the main source of friction between the United States and China for years to come. Every day’s paper since I’ve come to Shanghai, and every hour’s set of blogs, has brought news of some fresh assertion of state control. An internationally famous activist named Chen Guangcheng, blind since childhood, was convicted on charges of “organizing a mob to obstruct traffic” after he protested official misconduct. (Famous elsewhere, but not in China; I have found that few university students recognize his name, since Chinese media did not highlight his case.) Ching Cheong, a reporter from Hong Kong, was sentenced to five years in prison on apparently trumped-up charges of espionage.

Until I installed a “proxy server,” which allows my computer to tunnel under and around the “Great Firewall,” I was amazed at the parts of the Internet I could not reach from China.
Technorati.com
, for no obvious reason. Wikipedia. Both sites were mysteriously unblocked in October, but then I had trouble with Google News. One URL I can always reach is the central government’s very useful official Web site,
www.gov.cn
, which has an English page. Naturally it highlights the upbeat: A white paper on “China’s Peaceful Development Road” has as its first chapter, “Peaceful Development Is the Inevitable Way for China’s Modernization.” But, to its credit, it also includes announcements of the latest restrictions on commerce, banking, and the news media.

A list of the tensions between individual rights and the interests of the state could be very long. On the other hand, at least on brief exposure, urban China hardly feels like a hypercontrolled or overpoliced society. You can arrive at the Beijing or Shanghai airport thirty-five minutes before a scheduled domestic flight without needing to break into a nervous sweat. Few police are in evidence at the airport, and the security lines are short. (This is not because air travel is such a rarefied, elite taste in China. Fares are relatively low, and the China Eastern Airlines shuttle flight I took from Shanghai to Beijing was a 747 with all seats filled.) Every instant of life in East Germany under the Communists or in Burma under its ruling generals reminded you that Big Brother was in control. Walking down Shanghai’s main shopping boulevards, Huaihai and Nanjing roads, makes you think you are in one vast bazaar. You can hardly walk a block in Shanghai without passing a vendor selling pirated DVDs for less than $1 apiece. Viewing these has given me my first inklings of sympathy for the Motion Picture Association of America: I never have to spend much for a movie in China, but the versions of movies I can see are terrible. I missed
The Da Vinci Code
in America and bought a copy here. The dialogue had been dubbed into Chinese and then subtitled back into English—sort of. When Tom Hanks is told that descendants of Jesus and Mary Magdalene might still be alive, he asks incredulously, “BE? They on the hoof?”

I have not before been anyplace that seemed simultaneously so controlled and so out of control. The control is from on high—and for most people in the cities, most of the time, it’s not something they bump into. What’s out of control is everything else.

Often this is in a good way. On an evening walk down a

side street that looked little changed since the 1930s, my wife and I started noticing that nearly every person we passed was running a business of some sort. This man was riding a bicycle with a towering load of flattened-out cardboard, meant for a scrap dealer. That old woman was weaving together rice straws for a broom, helped by her toddler granddaughter who handed her straws. A middle-aged woman sat outside her house working on a sewing machine. A vendor who looked as if he had just trudged in from the countryside tottered along with a heavy yoke across his shoulders, balancing two heavy baskets full of peaches. Another man was selling crickets in tiny individual straw cages. It makes you marvel at Mao’s delusion in thinking that China could be a centrally planned economy rather than a beehive of commerce.

One reason why Americans typically find China less “foreign” than Japan is that in Japan the social controls are internalized, through years of training in one’s proper role in a group, whereas China seems like a bunch of individuals who behave themselves only when they think they might get caught. As I took an airport bus from downtown Tokyo to the distant Narita International Airport for the trip to Shanghai, the squadron of luggage handlers who had loaded the bus lined up, bowed in unison, and chanted safe-travel wishes to the bus as it departed. When I arrived in Shanghai, I saw teenage airport baggage handlers playfully slapping one another and then being told by the foreman to get back to work. In Japan, the controls are built in; in China, they appear to be bolted on.

A less attractive side of China’s social bargain comes in public encounters. Life on the sidewalk or subway may have been what Thomas Hobbes had in mind with his “war of every man against every man.” As technology, Shanghai’s subway is marvelous; as sociology, it makes you despair. Every person getting on a subway understands that there will be more room if people inside can get off. Yet the more crowded the station, the more certain that there will be a line-of-scrimmage standoff as the people trying to surge in block those trying to escape. In a perverse way, I was relieved when I read that China’s traffic-death rate per mile driven was nearly ten times as high as America’s: I wasn’t crazy in thinking that the streets were a reckless free-for-all. The writer Gwynne Dyer recently explained that such carnage is typical of cultures in which virtually everyone behind a wheel is a “first-generation driver,” raised with no exposure to traffic laws, defensive driving, or the damage cars can do. As more Chinese travel abroad as tourists, and China prepares to welcome more foreign travelers when the Olympics begin, the government has launched a “mind your manners” campaign urging people to stop “hawking” (noisily clearing their throats) and spitting on the street, to stop cutting to the front of lines, and to stop yelling at one another and into their mobile phones. Good luck!

The climate is that of the frontier, with an erratically vigilant sheriff showing up from time to time to crack heads. The untamed energies of individual Chinese have obviously helped the country grow, but some people have argued to me that the lack of Japanese-style collective virtues imposes limits on China. “We have a huge economy,” the founder of a Chinese software company told me at dinner one night, “but we don’t have any big companies. Why is that?” Depending on how it’s measured, China’s economy is either the third-, fourth-, or fifth-largest in the world. But only three mainland Chinese companies are among the top 500 in
Forbes
’s list of international companies, with the largest, PetroChina, at No. 57.

This man’s answer was that scale requires trust, and “there is no trust in China.” People don’t trust others outside their family, he said. “They don’t trust the Internet. Or doctors. Or the mobile-phone company to bill them honestly. Or, of course, the government.” Building a company beyond the family scale requires many layers of trust: in accountants, underwriters, the financial markets, the rule of law. “People are all looking for the profit in the next two years, so they cannot grow,” this man concluded. Would his company list shares on the stock exchange? “Ha!” he said. “The economy keeps growing, and the stock market keeps falling.” The big problem for the markets is what financiers call “lack of transparency”—that is, the difficulty in knowing whether a given firm is making or losing money, and the suspicion that it is keeping several sets of books.

“Corruption, corruption, corruption!” another technology executive exclaimed to me. “You could knock off a hundred corrupt officials a day and you would not make a dent.” To take just one indicative example: High government officials have recently found it desirable to be “scholarly.” Thus universities have become accustomed to dignitaries who attend a few classes and soon get a Ph.D. Japan has always had its scandals—I was living there when police found gold bars and $50 million in the home and offices of Shin Kanemaru, a backstairs power in the ruling party. The most famous South Korean CEOs of the 1980s ended up in jail. But those countries—unlike Russia, the Philippines, or Indonesia—manage to keep their corruption within the “efficient” range, where it will not impede the growth of business. So far, China’s corruption must also have been kept efficient—how else could the country have come so far so fast? But I’ve been surprised to hear how often corruption is mentioned as a major long-term threat.

And now we confront Two Great Mysteries of China, which concern its leadership and its ideals. I’m not referring to a host of Minor Mysteries I hope to comprehend over time. For instance, the miracle of the malls: how so much of Shanghai’s showy new retail malls can be occupied by Prada, Armani, or Louis Vuitton stores—the real ones, not counterfeits—when there appear never, ever to be any customers inside. Who pays the rent? Or the miracle of the loaves: every run-down neighborhood has a bakery selling very good croissants and baguettes (though it is very hard to find cheese in China, which after all has no dairy-food tradition, and where a standard knock against Westerners is that they “smell like butter”). I am after bigger game.

Of course, it can seem preposterous for a newcomer even to raise such points, as if a foreigner in America observed that the country “is divided along party lines” and “has racial problems.” But here are two of the many themes I want to know more about.

THE FIRST GREAT MYSTERY OF CHINA:
HOW SKILLFUL IS THE LEADERSHIP?

Everyone wants to know how long the Chinese economic boom can go on. Will an environmental crisis stop it? What about the gap between rich and poor? And between big shots on the take and peasants kicked off their land? After all, a nearly unbelievable 87,000 “public order disturbances” took place in China in 2005, according to China’s own Ministry of Public Security, up from an already alarming 58,000 in 2003. What about the contradiction between a rollicking market system and an intrusive, controlling, one-party state? And what about a hundred other concerns amply documented in studies from China and around the world?

These are all ways of asking: Can China continue to adapt? In adaptability, Chinese society as a whole puts the rest of the world to shame. Flower vendors and restaurateurs discovered that celebrating a Western-style Valentine’s Day increased their sales. Now the local florists promote one on the fourteenth of every month. One alley near our apartment is lined with shops offering turtles, fish, puppies, kittens, and birds as pets. On the next street over, most of the same creatures are offered as food. Whatever sells.

The Communist Party that sits atop this society has been both adaptable and rigid. In the nearly thirty years since Deng Xiaoping introduced “Socialism with Chinese characteristics,” aka capitalism under Communist political control, party leaders have adapted their way around one potentially ruinous difficulty after another. Even what the rest of the world sees as their most grievous mistake—the brutal crackdown at Tiananmen Square—was, from the regime’s perspective, another success. Without it, they might well have been driven from power. And the international denunciation did not seriously slow the country’s economic growth.

China’s continued growth depends on businesses, both homegrown and foreign—but the conditions for the growth are still set by the commissars. Even in the relatively laissez-faire United States, the commissars of the Federal Reserve constantly try to find the interest-rate level that will let the economy grow without causing inflation. The equation the Chinese planners have to solve is much more complex, involving everything from pollution to currency controls to maintaining social order while exerting control.

As for pollution: How much can they allow without absolutely destroying the countryside? How much can they prohibit without hurting their big export businesses? Even if they want to clean up, can they enforce regulations that restrain polluting activities, when so many provincial authorities have so much graft to gain by approving the next freeway, toxic-waste dump, or coal-fired power plant?

As for trade frictions with the United States, the finance ministry has made a start toward wiggling its way out. By letting the yuan’s value rise very slowly against the dollar, China has held down the price it pays for oil and other imported commodities that are priced in dollars—without overpricing its products in the U.S. markets. Senators Charles Schumer and Lindsey Graham frequently threaten to propose trade sanctions on China if it does not let the yuan’s value rise much faster. Several economists I have interviewed here say that being forced to raise the yuan’s value would actually be a huge victory for the Chinese economy. It would drive down import costs even further and would not do much to reduce exports to America, since many made-in-China goods are simply no longer manufactured in Europe or the United States. Can the Chinese officials work this negotiation to their benefit? My guess is yes.