EVERYONE who visits New York's Chinatown goes home with a souvenir. For most it's a box of fireworks, a painted fan, or a carton of moo shu pork.

But more than ever, tourists and even native New Yorkers are leaving Chinatown with something else in tow: the notion that this neighborhood of immigrants is descending into filth and chaos.

The evidence is unmistakable. In some tenements, three or more families share a barracks-style bedroom and a closet bathroom. Delivery trucks slathered with graffiti clog the curbs, and illegal street vendors render some sidewalks impassable. Kitchen workers pour buckets of used frying oil out in the gutters, and on hot days, the odor of decaying fish sweeps through the neighborhood like a sirocco.

Yet these images of squalor tell only part of the story.

In the same neighborhood, dozens of new banks, most open seven days a week, line Canal Street. Groups of Asian college students pitch long-distance telephone service on busy corners, and well-heeled shoppers browse specialty shops stocked with seaweed and shiitake mushrooms. Rapid Growth Challenges New York's Chinatown

Tourists pore over an array of merchandise, and everywhere, dollars change hands.

Behind its two disparate masks, Chinatown is bigger, richer, more diverse, more crowded, and more troubled than ever before.

``We are no longer following the old ways of catering to tourists, laundries, and restaurants,'' says David Chen, executive director of the Chinatown Planning Council. ``Chinatown is becoming more white collar with more banks, accountants, and travel agencies. It's becoming more of a cultural center.''

Scores of Hong Kong business owners - afraid of losing their assets when the Chinese government assumes control in 1997 - are pouring money into Chinatown, Mr. Chen says. Some are buying luxury condominiums (flanked by tenements) for as much as $300,000 in case they are forced to flee their homeland.

Real estate in Chinatown - located in Manhattan's Lower East Side - can be as expensive as in the midtown business district, Chen says, and zoning regulations prohibiting new development have led to gentrification.

``Those who find it convenient because they don't speak English will pay what outsiders won't pay,'' he says. ``Chinatown is the center for shopping and Asian culture. Japanese, Filipinos, and Thai people come here for rice. It's a comfort zone.''

By all accounts, it's also a boom town.

One neighborhood official says that Chinese immigrants, once concentrated in an eight-block area, now dominate as many as 65, engulfing what used to be Little Italy and the Jewish Lower East Side.

``The Chinese population has doubled every 10 years since 1960,'' says Frank Vardi, a city demographer. ``Although they have a low birthrate, the Chinese will bring their elderly parents, then their siblings, their cousins, and so on.''

Mr. Vardi says that Chinatown - ringed on almost all sides by the impenetrable borders that include the East River, the SoHo district, and the financial district - is running out of room. Thousands of Chinese immigrants are settling in Queens and Brooklyn, he says, where they have been credited with revitalizing neighborhoods.

According to the Immigration and Naturalization Service (INS), legal Chinese immigrants pour into New York City at a rate of 30,000 per year. Although no one knows how many illegals join them annually, some estimates run as high as 5,000 a year in Chinatown alone.

Most of these immigrants, officials say, hail from China's Fujian Province, a poor, rural area that, until recently, was closed to the outside world. Their dialect, Fujianese, is incomprehensible to the established immigrants who speak Cantonese or Mandarin.

In June of 1993, illegal immigration from China created a national stir when the cargo ship Golden Venture, loaded with 300 Fujianese, ran aground on a beach near New York City.

Crowded living

``I see Chinatown as being packed to the gills,'' city-council representative Katherine Freed says. ``It's been lawless for so long. We've got illegal vendors who work for subservient dollars and scrape by in crowded conditions. You can't walk on the sidewalk anymore, and there are more health-code violations than you can imagine.''

Ms. Freed says she has evidence that some immigrant workers don't even have their own beds. She says some landlords employ a system where one worker sleeps in a bed at night and works all day, while someone else sleeps in the bed during the day and works at night.

``Conditions are deplorable, because they've been ignored for so long,'' she says. ``Second and third generations won't come back to Chinatown.''

Police Officer Chuck Tsang, who walks a beat in Chinatown, explains that the newest, poorest immigrants sell fish heads and tails for people to make soup. What they don't sell, he says, they leave behind. ``The sanitation department won't pick it up because they say it's commercial, and the private haulers won't touch it because they're not being paid to.''

Situations like this, he says, combined with illegal vendors, robberies, larcenies, parking problems, drugs, extortions, and gangs divide his attention. Much of the increase in crime, he says, is directly related to the Fujianese immigration.

Agencies offer help

Indeed, a host of public and private relief agencies are scrambling to cope with the immigration onslaught.

``When I came here 19 years ago, the service population was about 35 to 40 percent Chinese,'' says Frank Modica, executive director of the Hamilton-Madison House, a 96-year-old organization specializing in immigrant services. ``Now it's 82 percent.''

In order to reach Chinese immigrants, Mr. Modica has hired 72 Chinese staffers, 16 of whom have master's degrees in social work. Hamilton-Madison provides day care and day schools, Head-Start programs for children, and basic health care.

``When we developed programs for the Chinese, we didn't know if they would come in, because we heard that they take care of their own problems,'' Modica says. ``Within a year, we had people coming in off the streets.'' Now, he says, his staff ``can't keep up with the demand.''

While his organization serves dozens of ethnic groups, Modica says raising funds for Chinese programs presents a unique challenge in what he terms ``the positive stereotype.''

``When you think of the Chinese, you think of the kids who study hard and win all the awards,'' he says. ``This image, which is positive, works against them. People say, `Why do they need the money?' We always have to make people aware that these people have problems.''

Perhaps the most acute challenges for Chinese immigrants, particularly schoolchildren, are the language and cultural barriers.

``We are trying to help these kids to catch up because their English skills are less than zero,'' says Amy Chan, executive director of Immigrant Services Inc., an organization that runs educational programs for Chinatown children.

``They really don't like this country. It's very different from China,'' she says. ``They have corporal punishment in Chinese schools. The Chinese students don't understand the system here, because they don't know what is expected of them. They have a hard time adjusting.''

Many children also suffer from a lack of parental attention, Ms. Chan says, because the labor glut has driven wages down, forcing both parents to work.

Not only are wages bottoming out (average pay for a restaurant employee has fallen from $1,000 a month to $750), but Chan contends that many workers are being exploited.

Last year, when the management of the Silver Palace Restaurant slashed employee pay and benefits, the case grabbed the attention of the Asian American Legal Defense and Education Fund. Urged by this local nonprofit group, the workers walked out for seven months and eventually won concessions. Margaret Fong, the fund's executive director, says that unfortunately, the case was an anomaly. ``Most undocumented workers don't stand up for themselves for fear of deportation,'' she says. ``Since undocumented immigrants can't vote, their concerns are easy to put on the back burner. The enforcement of laws gets neglected.''

Lately, some politicians have become downright hostile. In recent months, the governors of Florida, Arizona, and California have prepared to sue the federal government for their states' expenditures on illegal immigrants.

Although New York is second on the INS list of states with the most illegal immigrants, Gov. Mario Cuomo and city Mayor Rudolph Giuliani have made encouraging statements about immigration, legal and illegal. This stance has drawn fire from inside and outside the immigrant community.

``We should clamp down on the illegal immigrants,'' Chan says. ``There are plenty of us who did it through the legal channel. If you let these people in, we in the service community wind up getting the load. There's a certain limit.''

Competing for real estate

Most of the merchants along Mulberry Street in Little Italy echo this sentiment. Graziella Raimondo, the proprietor of Pentagramma Italiano, claims that the Chinese have been offering inflated prices for real estate in Little Italy. ``I don't like the Chinese. They pay too much for these buildings,'' she says.

Ms. Raimondo also claims that the Chinese have been driving store owners like her out of business by price gouging. ``I sell a hat for $10 in my store, and they sell that same thing for $1.50 on the street, but I pay taxes,'' she says. ``The city needs to crack down.''

Many Chinese store owners agree that the street vendors, who buy cut-rate goods at factory outlets and sell them on the street, are a drain on business.

Mei Liu Dong, who sells hats, bags, and T-shirts from her store on Mott Street, says she knows both sides of the vending game.

``Before, I was selling $1 headbands in the street. I was arrested four times, and fined $500. I borrowed money from my uncle to open this store,'' she says.

Business is slow, she says, and the rent is high: $5,000 a month. Still, she says, she will stay to pursue her dream of bringing over her two children.

``I left my job at a factory that manufactured baby clothes in Shanghai after the Tiananmen Square riots in 1989,'' Ms. Dong says with help from a bilingual employee. She explains that she paid smugglers $20,000 for passage first to La Paz, Bolivia, and then to the US where she paid off her debt in monthly installments of $1,000. ``I work very, very hard,'' she adds.

David Chen, the economic planner, notes that although the sign on a neighborhood restaurant might go unchanged for years, such establishments can change hands as often as twice a year. ``For every one success, there are 1,000 failures,'' he says.

While street vendors don't pay rent, Chen explains that some, like Ms. Dong, eventually climb high enough on the economic ladder to afford rent, hire employees, and pay taxes.

Looking to the future of Chinatown, Chen says the neighborhood is in a quandary.

Because of its role as a first port for poor immigrants, he says, ``turning Chinatown into a gleaming area is not the best thing.'' Still, he predicts that in 10 years, continuous investment from the Chinese mainland will render Chinatown ``glitzier.'' Its central location and popularity with tourists, he contends, will continue to attract immigrants and the problems they bring: competition for dollars, crowded conditions, dirt, and crime.

Chen sums up Chinatown's future as one of growth, diversity, and complexity. ``Everybody can see the growth,'' he says, ``but few acknowledge the diversity. If they can see the first two, they'll understand the complexity.''

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