Another Day, Another Mall

December 27, 2015

I don’t want anyone to come away from my blog thinking all I do in China is walk around malls and sit in Starbucks drinking coffee, but if I didn’t spend any time doing this, I’d be missing out on a big part of what’s making modern China tick.  These luxury malls and the shoppers who frequent stores purveying these premium brands (yes, Starbucks is a premium brand here when the average drink costs RMB30 or a bit less than US$5) are the future of this country, especially when the leadership is hellbent on reorienting the economy away from manufacturing and infrastructure investment towards domestic consumption.  It’s places like the IFS and today’s mall, Taikoo Li (太古里), that represent the way going forward if China is to ever make that transition.

So yes, I am sitting here at a Starbucks in Taikoo Li, which was built by the Hong Kong developer, Swire Properties.  A good friend of mine in Hong Kong who lives in Taikoo Shing, a family-oriented neighborhood on Hong Kong Island, told me that anything with the Swire name is going to be a quality property and this mall is no exception.  Built around an ancient temple, Daci Temple,  where you can still partake in a traditional tea ceremony, Daci Temple (大慈寺), Taikoo Li is filled with your usual luxury shops including Gucci, Burberry, Max Mara, and Cartier, as well as the Chengdu flagship stores for Apple (which with its two stores in Chengdu has more here than in Shenzhen) and Muji and the first stores in China for brands like Victoria’s Secret and Hollister.  It’s quite the complex laid out as if it was a warren of traditional Chengdu alleys, similar to Xintiandi in Shanghai or even Sanlitun in Beijing, which is another Swire property.  And the place is hopping with people eating, drinking, taking pictures, and even doing some shopping.

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One of the main squares in Taikoo Li

The Christmas decorations are still out in full force and effect, but so are the after Christmas sales with some stores offering discounts up to 40 or 50% off.

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Entrance to Taikoo Li as coming from Chunxi Lu (春熙路) Metro stop

I blogged recently about the “real” China and malls like this one are the new “real” China.  What’s neat about Chengdu is that you can walk from your hotel to the Metro station in Tianfu Square and pass by little hole-in-the-wall or “fly” restaurants (苍蝇馆), wet markets, and people playing mahjong in the streets, so not all of the old “real” China is lost.  It’s perhaps this blending of old and new that Chengdu seems to still do so well, whereas a city like Shenzhen which did not exist 40 years ago is all new and will continue to be that way going forward.  I don’t know if Chengdu will be able to survive the onslaught of modernization and the power of the new “real” China, but at the moment it seems to have found some sort of equilibrium, however tenuous.

Having now been here for a few days, I still really like the city.  It’s hard for me to put my finger on it exactly, but this trip is my first time to the interior of China.  When you think of Chengdu, and Sichuan province in general, it’s the last extremely developed area of the country before heading off into the wilds of western Sichuan and Tibet.  Chengdu feels less like a frontier city and more like an experiment in modernizing the interior.  It’s no secret that the government has spent considerable time and money spreading growth from the eastern coast to the interior and Chengdu is something of a showcase city, much like Shenzhen was when it became China’s first Special Economic Zone.  Chengdu has not received so formal a designation, but walking around the city and taking it all in, it’s hard not to feel that there is something special about this place and it’s not just all the panda advertising.

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Panda ad outside of my hotel

Nor is it all of the amazingly spicy food that I have been eating, which I will write about another time.  Perhaps it’s what China could be, though without the pollution that has rendered today a rather smoggy day (though nothing like Beijing) or the fact that signs are still posted on the street reminding people not to smoke on buses and in the subway reminding parents not to let their kids go to the bathroom on the train. Chengdu, like most of China, is moving quickly to catch up to the rest of the world in terms of development, but it feels a little more comfortable taking it’s time doing so and making sure it’s being done the “Chengdu way”.

Of course I wonder how many Gucci or Louis Vuitton stores a city really needs and who actually fills all of these new office towers going up, including the top floors of the Evergrande Huazhi Office Tower, which sit there all lit up and empty at night.

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The vacant and well-lit floors of the Evergrande Tower on the left

Those are questions for another day, but one that China unfortunately will have to reckon with as it continues working through it’s breakneck growth and reorientation to a consumption-driven economy.  These malls and buildings are part of the infrastructure and property investment that has driven growth in many cities around the country and if towers like Evergrande remain empty, one has to wonder what the means for future development and growth in these cities.

On that note, I leave you to get back to the hotel and get ready for a night of sampling Chengdu’s many street snacks.

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Greetings from Chengdu!  Being the good Jew I am, I decided to head to Chengdu Christmas morning for a long weekend of eating spicy Sichuan food and seeing some pandas.

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Giant panda climbing the IFS Chengdu, yet another luxury shopping mall in China

Okay, not exactly that panda, though the city makes good use of its panda connection by plastering the creatures all over the city.  Upon landing in the airport, many of the information signs were framed by pandas and that theme has been a constant since that point.

It’s my first time here and a city I have wanted to visit for a very long time. The original motivation was my love of Sichuan food (川菜), but lately everything I have been reading about China mentions the relatively newfound prosperity of its inland cities, which would include Chengdu and Chongqing.  Having only been here for 24 hours, I attest that Chengdu definitely appears to be on the up-and-up.  The IFS above is home to Prada, Gucci, Louis Vuitton, Zegna, two Starbucks, Muji, Uniqlo, a bookstore where I could buy new English books, a huge Western supermarket that is part of a Hong Kong chain, the requisite ice skating rink, and even a bowling alley.  The inside is your typical white marble, soaring ceilings, and the cleanest floors I have ever seen, probably due to the ever-present crew mopping and sweeping as you’re moving around the mall.  However, IFS is just one of many luxury malls in this area of Chengdu, which also includes the retail-filled pedestrian streets of Chunxi Lu (春熙路) and Imperial Examination Alley (正科甲港), an Isetan department store, a number of other Western luxury brands, and numerous Chinese brands.

I guess it makes sense given that Chengdu has become one of the richest cities in China.  The Milken Institute released a study this fall of the best performing cities in China and chengdu came out number one, beating Shanghai, Shenzhen, and Beijing.  Putting aside studies and government statistics touting GDP growth and per capita incomes, just the feeling I get walking around the city is that it’s one of growth and possibility.  Now one may argue that most of China feels like this and many places do, even in spite of the recent slowdown of the economy, but having spent the past month and a half in Shenzhen, I can sense a different energy here. Shenzhen is right next to Hong Kong and was created to rival its neighbor to the south and serve as a laboratory for economic liberalization on the mainland, so its people are used to being favored and there is also relatively seamless mobility between Shenzhen and Hong Kong, obviating the need to replicate a lot of the shopping in HK north of the border.  I mean, one would think that Shenzhen would have had it’s own Kiehl’s store before Chengdu, but you can only find it at the Shenzhen airport in duty free.  Chengdu has one in the Isetan by the IFC.  Not that Kiehl’s is a barometer for economic development, but the fact that a company like that went to Chengdu after Shanghai and Beijing says something about the city and its place in China’s economic hierarchy.

Chengdu is an inland city and only part of a central government push within the last ten years or so to promote growth inland away from the coasts.  With that promotion, an economic tiger was released as the city promoted its lower labor costs to attract global manufacturers in the aerospace and electronics sectors, including Foxconn, which produces Apple’s iPhone.  Anyway, not to devolve into a boring economics lesson, but the takeaway is that Chengdu has a buzz that is not always as readily apparent in some of China’s larger, more established Tier One cities.

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View of central Chengdu from my hotel

Of course this still being China, I marvel at how well the central government has been able to wall off the country from the rest of the world.  I’ve written a lot about the mystery behind Chinese people becoming more global as they travel the world, but seemingly bringing nothing back from the travels except luxury goods and souvenirs. Forgetting that when you fly domestically in China, you’re not allowed to turn on any electronics, I was left watching some bizarre Korean movie on my flight from Shenzhen to Chengdu.  When I arrived, I thought I would either be given or be able to buy a Financial Times or Economist at the Ritz Carlton or find another hotel with a gift shop at which I could buy one of these publications to read on the way back to Shenzhen, but to no avail.  Even the Page One, where I eventually found English books, had a magazine section with only Monocle and In Style in English, neither of which I was particularly interested in buying.  Putting the availability of Western media aside, I am sitting here in a Starbucks (where else?) in another new luxury mall called The ONE and it’s one of Starbuck’s new Reserve locations with pour-overs and siphoned coffee.  The place is packed with young and old, alike, and many on iPhones or Macs enjoying coffee, pastries, and quiche.  At this particular moment I feel like I could be anywhere.

Yet, with all of that said, there is something about Chengdu that reminds me of the China I knew 15 years ago.  Perhaps it’s the layout of the city with back alleys still filled with little stores and food stalls or the mix of old and new buildings that co-exist side-by-side, though I have the feeling that won’t be the case five years from now since so many look like they’re being readied to be torn down for new construction.  I guess Chengdu is a city that while growing rapidly, still retains elements of what it was.  It has long had the reputation of being one of China’s most laid-back cities and for a city of nearly 8 million people, still moves at a remarkably more languid pace than Shenzhen.  Maybe it’s part of a next wave of growth where people won’t be in such a hurry as they modernize and seek to retain some of what makes a particular place unique?  Or perhaps it’s as simple as the fact that unlike Shenzhen or even some of the other Tier One cities like Shanghai or Guangzhou, Chengdu is a city filled with people who are actually from here or the surrounding areas, which would go a long way to preserving those qualities that make the city special.

As I was leaving my hotel this morning, I was chatting with one of the members of the concierge staff, Roland, asking him for restaurant recommendations while I was here.  He told me that he had just transferred from Beijing two months ago because his wife was pregnant and they wanted to escape the pollution,, traffic, and mayhem of Beijing.  I asked him how he liked Chengdu so far and he remarked that it was more laid-back than Beijing.  He attributed this to the fact that home prices were so much lower than Beijing, so people didn’t have to work so hard, thus they had more time to relax and enjoy life.  Probably the most interesting reason of all for why Chengdu feels so different, yet one that not only makes the most sense, but is very telling as to what is potentially being lost as the country rushes to modernize. As an American, I know all about a country that does not seem to have enough time for leisure as our workweeks get longer and longer and people fear taking holiday because they may fall behind at work.  Let’s just hope that Chengdu doesn’t go the way of the rest of the country and lose what makes it special.

Zombies at Christmas

December 6, 2015

I am having one of those weekends where I am frustrated with China and it’s many contradictions.  As long as I have lived in and studied the country, it still does not make sense to.  I know that’s the reason it’s held my interest for nearly twenty years, but sometimes I reach a breaking point and then it passes.  Between having to deal with spotty phone connections, wrestling with my VPN so that I can communicate with the outside world, and the inability or express frustration in Chinese because my teachers only taught me happy words, at about the month point I am frustrated.

On Friday I went up to Guangzhou for work. It was my first time back in over five years and while I was only there for a few hours and pretty much toured a school and sat in the train station, I had a two-hour drive up from Shenzhen to think about China and my time here so far.  The drive was up the 广深沿江高速, which literally translates to the Guangzhou-Shenzhen Along the River Expressway.  It runs up from Guangzhou through all of the factory towns of the Pearl River Delta, including Dongguan, through to Guangzhou.  Those factory towns are the ones that you read about in the newspaper closing up shop and moving to Vietnam, Bangladesh, the Philippines, other ASEAN countries, or inland China where labor is less expensive.  These factories are the ones that churned out jeans, iPhones, bras, shirts, printers, and many other goods over the years.  Now driving up the highway, many are either abandoned or look like they’re about to be abandoned.  But to counter those abandoned factories I saw lots of cranes putting up apartment blocks.

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View from the car headed towards Guangzhou

The thought that’s always front and center when I see these new apartments is “Who is going to live here?”, which from the number of so-called ghost cities in China is a plausible question.  However, this is the Pearl River Delta and if there is one trend I have noticed over the last 15 years it’s that there is a strong push to urbanize the entire corridor from Shenzhen to Guangzhou.  So there is little doubt in my mind that these towers will be filled and one day between the two cities there will be an unbreakable stretch of these towers.  So what happens to the abandoned factories?  Assuming there are no toxic chemicals on those sites, which is a big if, then towers will go up.  I’m not sure if China has the equivalent of Superfund sites like we do in the States, and if they did, I am not sure there would be enough political will to designate them as such.  It’s the unknowing or inability to know, assuming one wanted to know that drives me nuts about China sometimes.

It’s the holiday season, even here in China.

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Christmas tree at entrance to my apartment complex

Between the random Christmas trees and holiday music blasting in the shopping centers, including the ubiquitous “All I Want for Christmas” by Mariah Carey, it adds a surreal dimension to life in China.

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Holiday festivities at the Garden City Mall

Maybe its my frustration speaking, but there is something zombie-like about taking in this whole China experience as a foreigner.  I already disconnected because of certain personal uncertainties, but Shenzhen is a city built on commerce.  In fact, it’s really the reason it was ever conceived by the central government 30 some-odd years ago.  People mill about in a frenzy of eating and shopping, though I see very few shopping bags, which might lend some anecdotal credence to the stories you read of China’s economy slowing down.  It’s kind of like what it was like going to a mall during the last recession in the States.  People were there, but they weren’t spending.  The malls are more like entertainment zones with hockey rinks, playgrounds, movies, and restaurants.

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A hockey game at Coastal City Mall

Some days it feels like all people do here is eat and shop.  There is no real pervasiveness of the news like back home where big cities have tickers on buildings with the latest stories or elevators at work have the little screens with the day’s top news stories.  No tickers in China and the elevator at my school has pictures of pandas and penguins to go along with the date and time.  It’s a bit of an over-generalization to say that no Chinese people care about current events, but the government has put in place a number of distractions to ensure that people pay as little attention as possible to the world outside, unless it’s necessary to stoke nationalist sentiment as a bulwark for the government.  Of course there are intellectuals and people concerned with these sorts of matters, but they are on the fringes of society.  There are no cable news programs outside of CCTV and other government-run outlets, so there’s no real widespread forum from which people can get alternative opinions.  For better or worse, Donald Trump and his rallies get air time on television and we have a relatively robust network of columnists and commentators trying to make sense of things in our country.

This past Friday, China celebrated its second National Constitutional Day, commemorating its constitution that is supposed to provide for all kinds of freedoms that exist only on paper.  There were no noticeable celebrations here in Shenzhen.  In fact, it seems like the way the government decided to commemorate it was to continue snuffing out various forms of expression, ironically the same kinds guaranteed in the constitution.  Included in that snuffing out was a recently published book by a Tsinghua University (referred by some as the MIT of China for its science and engineering prowess) historian about China’s constitutional transformation.

I guess my frustrations this weekend started small, but have now led me down this path of wondering what is really going on in this country.  It’s hard to tell what lurks beneath the veneer of iPhones (and may iPhone wannabes), fancy shopping malls, and the smiling faces roaming about these shopping malls.  I guess only time will tell.

The Real China?

December 1, 2015

“Where is the real China?”

Since I’ve been here, I’ve been asked variations on this question from the American teachers at our school for which this stint in Shenzhen is their first time in China.  I struggle to come up with a good answer because I am not sure I actually know the answer.  Depending on the day and my mood, I recommend checking out Beijing for a good contrast between the old and new China with a bunch of government formality thrown in for good measure.  Or maybe I extol the history in Xian with its terra cotta warriors and ancient city walls still standing.  Or even Yangshuo (阳朔) for its beautiful scenery and Yongding (永定) with its tulou (土楼).

Maybe Shenzhen is actually the best representation of the real China. 30 or so years ago it was nothing more than a 50,000 person market town through which the Guangzhou – Hong Kong through-train passed.  Now it’s a metropolis of over 15 million people, depending on how many of the surrounding towns you include in that count, and home to an endless supply of high-end malls, one of China’s two stock exchanges, and extreme wealth on display throughout the city.   This dramatic transformation, which at this point has been noted by anyone who has spent time here or in any number of China’s other Tier One and Tier Two cities, is almost a given when speaking about China. However, the teachers for whom Shenzhen represents their introduction to China, something rings hollow about the city and the experience.  It’s not that it’s not pleasant or convenient, but it almost feels too easy and not what they expected of China.  But I have to wonder what they expected China to be if not a temple of consumerism and capitalism with very little in the way of apparent angst about the country’s problems and where it’s going.

Just an aside to note that I must give props to my dad for bringing to my attention Andrew Jacobs’ “Notes on the China I’m Leaving Behind“, which was published in this past Sunday’s New York Times.  In short, it’s his take on where China is at after spending almost eight years on the ground.  It means more to me that my dad brought it to my attention because I’d like to think that it’s my being here on the ground that caused him to stop and read it whereas if I wasn’t here, there might have been the chance that he would have skipped over Jacobs’ piece.   Thanks, dad.

Jacobs notes this disconnect between the shiny veneer of consumerism and deeper problems that lurk beneath this surface.  He writes, “[T]he Communist Party, largely through fear and intimidation, seems to have trained much of the population to channel their energies into the pursuit of consumerism.”  This sentence gets to the heart of what is so strange about China, especially to Americans who are so used to the constant bombardment of negative news that makes it hard to enjoy Black Friday or Cyber Monday.  Most Chinese people seem rather oblivious to the problems around them, including a slowing economy, rapidly degrading environment, disadvantageous demographics, and the detention of anyone who dare challenge the regime.

Shenzhen is even more of a conundrum because it should embody the idea that the further one is from Beijing, the less reverence they have for the government and its policies.  That actually may be true to an extent in Shenzhen, which is richer and freer than most other parts of China, but the vacuum that exists from seemingly not caring about social and political matters is what makes the city feel so strange.  Its proximity to Hong Kong and relatively porous border only heightens the strangeness. Shenzheners cross quite regularly between the two cities, but it’s mainly to shop in Hong Kong because of its better selection of Western good and lower prices.  Yet, Shenzheners bring little else back with them except bags and suitcases full of purchases.

To an American like myself who goes back and forth quite frequently and have been doing so for over a decade, I still marvel at the feeling of how different Hong Kong is from the moment I step off a plane, train, or boat. I don’t know for certain, but would guess that most Chinese people crossing the border just see the city as a giant shopping mall.

Foreign Policy is running a special series on education and the relationship between the U.S. and China.  Zara Zhang, a Chinese student at Harvard, writes about her experience there and acting as a bridge between the U.S. and China.  Her experience at Harvard is a fascinating read, especially as someone who has taught top university students in China.  Among her many observations, one stood out for me at the end of her piece, “If China will one day become a more democratic and open society, it will probably be a result of the effort of this large group of culturally hybrid individuals whose heads are now used to Western thinking — but whose hearts are unchangeably Chinese.”

I have thought about this point a lot and I think it’s what any Western country that hosts a large number of Chinese students at its high schools and universities thinks, too – that by welcoming Chinese students into the halls of Western education, they’ll be imbued with ideas of freedom and democracy and bring those ideas back home to clamor for change.  The question that is not answered is whether those ideas will be subsumed upon returning home once those same students start working and realize that the current system is better set up to reward those with degrees from top universities.   Another way of thinking about it is this – will coming home and joining the existing system prevent these idealistic students from carrying out the reforms they may have been so excited to see through when sitting in a classroom in New Haven, Melbourne, or Oxford?  I don’t know the answer, but I would like to see where the Zara Zhang’s of China are in ten years’ time.

Jacobs’ point that the government has so successfully turned people’s frustrations and desires for change into a force for consumerism could mean that even successive generations with more exposure to people and ideas from outside China might not be enough to correct the social and political problems that China faces if it’s to make that jump from purely an economic juggernaut to a true global power.  For those who wonder if Chinese people actually care about these social and political problems, Jacobs makes it clear that there are people who are disgruntled, but they’re powerless against the huge tide of people who would rather shop than think about what ails their country, especially since there are a lot fewer restrictions on spending money than doing other things.

And for those looking for the real China, if you’re in a city like Shenzhen, you’re probably experiencing it every day.  Just walk to any one of the many malls on a Saturday afternoon and wander around taking in the people milling about and there you have it.  Happy shopping.

 

Home Sweet Hong Kong

November 21, 2015

I’ve been back in Asia over a week at this point and made my first trip to Hong Kong yesterday for meetings.  I’m staying the weekend because my brother and his wife are swinging through at the tail-end of the honeymoon in SE Asia and I am really excited to show them around this city that was my first home after college.

Coming back to Hong Kong is always filled with a mix of nostalgia and awe at both how quickly the city changes and also how so many random points in the city remind me of when I lived here over 13 years ago.  I took the ferry to Hong Kong for the first time from Shenzhen and aside from having to arrive nearly an hour before the ferry and queue up for immigration in Hong Kong, it was a rather easy trip.  It’s just good to be back here.  From the moment I stepped out of immigration at the ferry terminal into, what else, a massive shopping mall, I felt instantly more present.  Now I love China and spending time there is intellectually and (usually) professionally fulfilling, but the personal angle is so much harder to actualize there.  When I was living in Guangzhou for the year, I was very obviously a foreigner and nothing else about my identity mattered to people there.  Now we have an international school in Shenzhen filled with American teachers, which is a pretty cool thing to experience, but it feels like an island of recognition in the midst of the otherness that one usually feels in China.  As a result of feeling this otherness, isolation tends to be the norm in China because no matter how good your Mandarin is or as much as you want to blend in, you can’t.  So coming to Hong Kong, it’s refreshing to just walk the streets and ride the subway and feel a part of something that is more multicultural.

I taught a unit on multiculturalism to my students at Sun Yat-sen University (中大) and when I asked them to list concepts that would be a part of a multicultural society, they were stumped.  It wasn’t until I began writing things on the board that they understood where I was going with the exercise.  I think the difficulty stemmed from this idea that most of China is made up of Han Chinese and anyone else is seen as an other.  That only accounts for the ethnic dimension of multiculturalism, though.  Things like sexual orientation, gender, sex, religion, and a whole host of other things that make up a more multicultural society don’t exist in China.  Now I am being facetious, but while all of these things exist in Chinese society, people don’t tend to see their society as such.  I feel like there is a more simplistic view of society which makes it harder for difference to flourish.

Then you come to a place like Hong Kong, which while not perfect, compared to the mainland is a more open society.  What’s most jarring is that when I am sitting in Shenzhen, I am 15-20 miles from the central business district in Hong Kong, but it might as well be a world apart.  I struggle with how to explain the difference between the two societies, but a few things stand out including Hong Kong’s history as both a British colony and treaty port.  The British legacy lives on, but it’s been joined with other cultures brought by waves of expats who come and go over the years.  At the moment, I have noticed a significant number of French expats milling around, which could have something to do with France’s lackluster economy.  However, it’s not just the expats, but a local population that has always looked outward for its livelihood.  It’s this orientation that makes the city quicker to embrace global trends and more comfortable for people to fit in and go about their business.  There are definitely parts of Hong Kong way out in the New Territories where villages exist much as they did 50 years ago, but even those pockets are changing.

So I am here for the weekend and soon will be moving down here, but it’s the contrast between Shenzhen and Hong Kong, two cities that are so close, that I am wrestling with.  The Shekou district of Shenzhen, where I am staying feels like Hong Kong lite with its shopping malls and new apartment towers.  They even have a part of town on the water called Sea World that is filled with Western restaurants and the most expats I’ve seen so far in Shenzhen.IMG_9392

The picture above is the part of Sea World along the water, but it’s best to think of it like a large town square with restaurants and cafes off to the sides and more restaurants scattered off the main square.  I feel like Sea World could be anywhere, but it’s in China, a country in which I still can’t access Facebook and any apps that rely on it like Words With Friends or the New York Times without a VPN.  Shenzhen is so close to Hong Kong, but brings back none of the multiculturalism that exists there.  Hong Kong seems to only serve as a giant shopping mall for mainlanders crossing the border to visit with little interest in anything else going on there.  Even the metro, which is very similar to the MTR is almost, but not quite right.

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So close . . .

I’ll be in Hong Kong for the next few days, so expect a few more posts from here and then it’s back to Shenzhen for Thanksgiving.

 

Randomness

November 15, 2015

On the lighter side, some randomness from China including shopping for Christmas decorations on a Sunday night at Walmart and the seemingly nonsensical rules and regulations for the elevator in my apartment building.

Not sure what it means to "slapstick"

Not sure what it means to “slapstick”

Christmas at Walmart

Christmas at Walmart

Houses of Cards

June 27, 2012

A short while ago, an email came in with a link to an article that is an interview with Chen Guangcheng on the New York Review of Books’ blog.  Chen is the blind dissident who left China recently to study at NYU Law School in New York and is actually from Linyi.  To be more accurate he is from Dongshigu, one of the villages that is overseen by the Linyi city government.  When I write about all of these new high-rise towers that keep sprouting up further and further from the center of the city, the land for the towers were formerly villages annexed and cleared by the city government to continue the city’s growth.  Before Linyi grew into the city that it is today, it was really a collection of small villages with the town of Linyi at the center.  To fuel economic growth and boost the profile of local leaders, villages began being annexed and the high rises you see in my pictures are the result of the city’s growth.

There were some things that really stood out in the interview because of the fact that I am sitting here writing from a hotel that was probably built on part of a village that no longer exists.  The massive Linyi University campus was probably also one or more farming villages at some point in time, but are not part of the city proper.  The interviewer asks Chen if he thinks urbanization is beneficial because then people can move off the land to get jobs in the city and earn more money.  This was his response:

No, I don’t think it’s beneficial. Right now it’s a blind urbanization. Cities grow up naturally over time. Now they’re trying to do it all at once. The main thing about urbanization now is to make the economic statistics look good—to build and pump up economic activity.

Chen basically backs up a lot of what I have been thinking and writing about when I look at Linyi’s development, especially versus cities like Shanghai or Beijing that have a more solid economic foundation because they are home to headquarters of large companies, the creative classes, or are seats of government power.  He continues on saying that many times when these villages develop into towns and cities, the people who resorted to more traditional ways of making a living are often left out in the cold as the real estate developers, banks, and government officials profit:

I think for those who go to the city and work there’s a benefit. But the current way of villages being turned into towns—I don’t think there’s an advantage to that. People in the village often rely on ordinary kinds of labor to earn a living, like working in the fields, or raising geese or fish and things like that. So now what happens? They turn a village into one high-rise apartment building and that’s all that’s left of the village. Then the land is used for real estate projects controlled by the officials. Where are the people supposed to work? How is that supposed to function?

I often wonder what people do in a city like Linyi.  Aside from the typical service jobs that exist in any city – salespeople, waiters and waitresses, tellers, barbers, etc. – there are only so many people who work in offices who would earn enough money to be able to afford the thousands of new apartments being built.  Others I have spoken to here say that businessmen who travel to Linyi for work will purchase an apartment to stay in rather than stay in a hotel and those people with enough money will buy two or three apartments as investments.  Fine.  Even with those people purchasing apartments, the fact remains that such housing remains out of reach for many who used to live in a village and are now having urbanization shoved down their throats.  I think of the manager in the Binhe Hotel, where I stayed last time I was in Linyi and his tale of how he works multiple jobs and still did not have enough money to buy an apartment.  There must be many more like him than the people who can afford two or three apartments or the businessmen who fly in from Shanghai or Beijing and would rather stay in an apartment than hotel.  I read Chen’s words as a warning that this haphazard urbanization without the necessary jobs to support it could be a disaster as people become increasing disgruntled about being shut out of life in the place where they are supposed to be living.  

The corollary to this point is the number of shopping malls being built.  If people cannot afford apartments, how are they going to shop in all of these luxury malls that are springing up all over the city.  Just coming off a weekend in Shanghai, my mind is boggled by the amount of conspicuous consumption in that city, but at least the jobs are there to support that consumption to some extent.  I am not saying that there is not money in Linyi, just not the type of money to sustain the level of future development envisioned for this city.  I even wonder if Shanghai can support all the new malls that are going to come into existence in the coming years.  As my friend Paul put it, part of the gamble as a retailer is picking the mall that is going to be a success.  With more and more malls that increasingly look alike, we begin talking about high-stakes Vegas odds because the development is not being carried out with any thought to the local population and what the people may want.  It’s still very much a “build it and hopefully they will come” mentality.  

The building of malls divorced from what makes business or economic sense is a problem in the Chinese economy at large and something I’ve thought about since college.  Many economic decisions made at the top are divorced from what may be good for the macro-economy.  Rather these decisions are made because of political forces that trump the economic, thus there is a heightened likelihood of a degree of failure.  At the most basic level, the need to maintain a certain level of economic growth to ensure that the population remains happy, the implicit social contract that drives China’s economy, is a policy for political survival that does not always jive with economic realities.  How many new airports, coal mines, highways, and train stations does this country need?  The Linyi airport is lovely, but barely has any flights to justify what I am sure was a hefty price tag.  However, the airport is a fixed asset investment and can be counted in the GDP numbers reported by local officials, which in turn get reported up the chain to Beijing and make the economy look like it is humming along.  We were actually joking at dinner last night that the speed and quality with which these projects are constructed ensures that they will have to be rebuilt in a few years so then the government can just count the project again.  That statement was made slightly tongue-in-cheek, but it’s kind of true.  It may take ten years or more for a new airport to be built in the States, but at least when that airport is up and running, it is built to last 50-75 years or longer.  In China, so many new buildings begin to look like they should be condemned only a few years after going up.  I think of the campus of the university here.  It was only a built a few years ago and already the fixtures outside the buildings are rusting, the doors inside are warped, and there are cracks in the walls all over the place.  I can only imagine what a lot of these new apartment towers look like, especially those that are half empty.

Economic policy divorced from economic reality is not sustainable.  It’s easy when you have money to pump into capital improvement projects, but it’s much harder when you need to affect rational human beings.  It’s why the authorities in Beijing have been more successful at building high-speed trains (success in building them, but not necessarily in operating them safely) than getting consumers to open their pocketbooks and re-orient the economy towards more domestic consumption and away from export-led growth.  Having the government build an airport or train line that is eventually going to be run by the government does not require rational policies because all the players’ interests are aligned by the desire to make money, which travels in a vicious circle and rarely trickles down to the average person.  However, getting people to change their shopping behavior requires rational thought because for all of the government’s attempts to control the people, some things are so intrinsic that they cannot be controlled by a higher power.  A person worried about having enough money for health care, retirement, education of their children, and to put a roof over their head and food on the table is not going to automatically start buying more discretionary items just because the government tells them to do so.  For that to happen, rational policies are necessary like state-subsidized health care, better education at a lower cost, safeguards for retirement, and the like.  While the government talks about such social safety nets and academics write papers urging the government to begin using some of its largess to build such programs, they are still not being being created.  Why?  Because such programs will not bear dividends until much later in time and the government thrives on short-term gain in the form of easily obtainable economic growth to justify its existence.

Chen is spot on when he points out that the development path China is currently on is not sustainable because for all the wealth sloshing around in Beijing, Shanghai, Guangzhou, and other large cities, there are huge swathes of the population unable to partake in this life and the government is not taking the necessary steps to bring them into the fold because they are blinded by their own desire to protect their positions of power.