New struggle in China: Keep up with the Chans

10 percent of urban households control some 40 percent of urban wealth, sparking frustration.

As the "year of the dog" arrives in China, a new fad for those partaking in China's success is weekend skiing. Office groups migrate to one of eight new ski "villages" outside Beijing. Many arrive in SUVs, the current "it" car also used for fashionable expeditions to outbacks in Gansu or inner Mongolia.

Chinese who can afford such luxuries are expectation-setters. Along with Olympic games and space launches, they are models of what China can deliver - a prosperous society that President Hu said in his New Year's message will allow "all Chinese to benefit."

Yet officials worry that expectations may have risen too fast. Frustration is felt broadly among those who rub shoulders with wealth but aren't quite benefiting. At Beitang Catholic Cathedral on Christmas Eve, Bishop Liu Yong Bin appealed to a packed house that "we not become angry when we see others have more than we do."

After 15 years of headlong marketization and material progress, China is at a transitional moment. Its leaders face the delicate task of managing a social contract that includes rising expectations - as well as adapting a one-party communist state and Confucian culture to the needs of an increasingly modern and educated populace, experts say.

"Things have gone from all ideology and no materialism to all materialism and no ideology or values," notes veteran China watcher Laurence Brahm, owner of the Red Capital Club in Beijing. "Expectations are a big phenomenon. The '80s were about idealism. Now the talk is 'what brand are you using?' Urban China is about keeping up with the Joneses, or the Chans, in this case."

To be sure, the hopes of ordinary Chinese have never percolated more strongly. Li Wan, just off the train from Jiangxi province, sits at a huge public electronic "jobs board" downtown that flashes ads for "parking lot attendant" or "deputy office manager." He wears the tan socks and slightly bewildered expression of the waidi, or "outside Beijing person." His dream is an apartment in Beijing and school for his daughter. But like so many interviewed for this story, Mr. Li's plans hinge on making $150 more per month, and work is harder to find than he thought.

Around the corner, a young woman chews a chicken sandwich and tells of moving from a Wal-Mart job in Shenzhen to employment as a cosmetics salesperson at Dangdang, an online shop. She hasn't reached her dream of buying a house and getting married. By law, 10 percent of her earnings go into a housing fund she can tapwhen she is ready. "I hope my job will be better, and I can buy a house in two years. Many people are waiting to afford a house."

In just two decades, China has moved from almost zero productivity and capital, and a state-planned society, to being a top manufacturer with massive foreign reserves. A 20-year-old has known nothing but upward mobility. Last month, Yao Wenyuan, the last of the Cultural Revolution's hated "Gang of Four" died, a relic of a poisonous period. Today, success has become a secular religion, reinforced by messages of opportunity in nearly every official speech - "sermons about paradise," as one Western scholar put it.

In some ways, China's money culture is spawning more avaricious - and unchecked - competition. There is a more intense game of keeping up with the Chans, but with no cushions like Rotary clubs, churches, or other civil or volunteer structures. Some 40 percent of wealth is controlled by 10 percent. Young people are getting diplomas in record numbers, but unemployment is 10 percent for those under 30. "Underemployment" is far higher.

Andrew Hu, educated at the University of Washington, says Chinese now have the same problems with stress and expectations as Westerners. "It's our dream to have an easy life," he says. "But we can't because we have to take care of a family and compete with other people in our jobs. The pressure not only comes from family, but other people. We see people with a new car and we say we need a new car."

"The gap between expectations and salary continues to grow, and psychologically a great number of [Chinese] feel under more pressure," says Victor Yuan, director of Horizon Market Research in Beijing. "Expectations are high, but so are mortgages. The society is more consumerist, and many people are under heavy family pressure to satisfy demands. Some find it hard to maintain their jobs, let alone talk about expectations."

Ma Jinliu, who speaks perfect English, got a graduate degree at a European university. But he came home to the same job at a German joint venture he left two years earlier. "I didn't have a choice. The market is very tough ... and I can't take my money from the housing fund, which is irritating."

An expectation crisis is less felt among the 3 percent of wealthy urban Chinese who hire drivers, send children to schools overseas, and make more than $1,200 a month. Rather, it is felt in a vastly broader category of urban Chinese who live in the new money culture, but don't yet have a firm stake in it. They earn between $150 to $350 per month - typical for civil servants, academics, clerks, military officers, engineers, and teachers. Good houses and cars are hard to swing. On TV, they see others doing things they can't afford. Instead, they sock away savings for health care, knowing the system is not serving them well. Many feel cynical about the housing fund as they feel it will be years before they can use it. (Many marriages now involve "sharing expenses" as a principal motivator, one young person points out.)

Last month, the state decided not to increase wages 25 percent for this class - since it would widen the gap too far with earners just below that level. As one party member put it, "We all have expectations now. But I haven't reached them and I'm now in my 40s. I'm getting a little worried."

Many Chinese have strong principles of fair and unfair, right and wrong. They see people getting ahead by cutting corners or corruption.

One colonel who makes $500 a month will not be promoted further; he will lose his car privilege, and it will be difficult to send his daughter to a top college. He feels he is losing out because he won't accept illegal side jobs.

"The Communist Party is in the midst of an identity crisis. On the one hand, they want one-party capitalism and promote conspicuous consumption," says Mr. Brahm, who owns the Red Capital Club. "On the other hand, they have no values, are empty of real values. That lack of values is a taproot of the corruption, irresponsibility, and social disorder that the central government is concerned about."

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