A Brief Trip to China

 

 

Shanghai

What is China really like?  I just returned from an 8 day trip to China.  In a trip sponsored by the Vermont Council on World Affairs, we visited  Beijing, Suzhoe (pronounced su joe), Shanghai and Hangzhou (hang joe).  While an eight day trip makes me just a tiny bit more knowledgeable than most Americans, it does provide at least a first impression of the country. 

            China by any analysis is a booming, growing country.  In the big cities along the east coast where we visited, construction projects are everywhere.  In fact, some people claim that the new national bird of China is the “boom crane”.  It is not unusual to see four, five, six cranes busily working on many construction sites in these growing cities and Shanghai must be considered one of the most modern cities in the world. 



Construction, the Chinese "national
bird", the boom crane

            It’s also easy to see that the people in China are prospering. The citizens in the cities are dressing in nice business attire and are usually on the go.  People in the parks and gardens are dressed in clean, casual attire and are strolling more casually but still appear to be on a mission.  I saw only a few who were obviously poor.  A few disabled sitting on the side walks begging for money; but able-bodied pan-handlers begging for money, I saw none of these.  There are, however, the ubiquitous street vendors, who we impolitely called “mosquitoes” because they bug you whenever you get on or off the tour bus. These persistent sales people will offer you the opportunity to buy a “genuine” Rolex watch for five US dollars or other street trinkets that you just can’t live without and they don’t go away with a simple “no thank you”.  Also I saw many people sweeping the streets with brooms.  In fact, I didn’t see street litter anywhere in China, not even in Beijing or Shanghai that are homes for millions of people. The government employs thousands of people as municipal workers to keep the streets clean and that seems to work. 

                      

Keeping the city clean

          It’s also obvious that the Chinese people are fond of Americans and Europeans (I don’t think they can tell us apart).  If you ask a Chinese person on the street to take their picture, he/she could not be more willing.  Ask a Chinese woman to take a picture with her adorable baby and she’s eager to do it.  Ask them to take your picture and they gladly do it.  In fact, they want to be in the picture too! 

           Another curious phenomenon is that the US dollar is accepted for currency everywhere, not British pound or German deutsche mark that I could see, but US dollar, yes!  Six yuan per dollar is accepted everywhere.  I soon became proficient at dividing the price in yuan by six.         



Tienanman Square and Entrance
to the Forbidden City

            Of course, China is thought of as a communist country and most of us were brought up to believe that communism is bad, removing all liberty from the people, and ruling the people with a heavy handed dictatorial power.  Well if the Chinese people are unhappy they certainly don’t show it.  In fact, China is not strictly communist.  There are millions of small businesses owned and operated by private people. China is a giant at making small businesses thrive.  In fact, I asked the tour guide, “In China, who owns the electric company?”  “The government” he replied.  Then I ask him, “Who owns the office buildings that are being constructed?”  “Well the development company owns that, and the construction company builds it for the development company.”  That sounds capitalistic to me.  But many of the big businesses are controlled by the government, all the provincial government employees work for the government, all the electronic, telecommunications and power companies are government controlled and some of the manufacturing and industrial companies are owned and operated by the government   However, some foreign manufacturing companies are owned by the foreign company.  For example car parts made for Ford and General Motors are owned by Ford and General Motors and employee’s paychecks probably have Ford and GM at the top.   These businesses operate in China according to Chinese regulations and must pay the Chinese government for the opportunity to have factories in China.  The point being, China in not a strictly communist country where all the means of production are owned by the government (or in communist lingo, all the means of production are owned by the “people”).  China is a blend, a mish mash, of government operations and private operations.



High speed rail

            There’s no doubt though that China is a centrally controlled country, how else could birth rates be controlled to only one child per family.  I think that this is a more important fact then it’s supposedly communist form of government.  China deals with issues, whether political, economic, social, international, by centralized government control.  Yes, China is a single party system. All members of the government are communists, but it is the central control that’s the crucial factor, not that it is nominally communist.  It may be that a central authority works well in a country like China where people are more society oriented.  Perhaps it is centuries of people living in close proximity that allows them to work more closely as a society, as a community.  Or perhaps it is the approximately 40 centuries of being ruled by an emperor who was the ultimate authority.  China was ruled by an emperor from 2000 years before Christ until 1912, when the emperor was overturned and a more democrat government called the Republic of China was established by Chiang Kai-Shek.    Chiang lasted until 1949 when Mao Zedong forced Chiang into Formosa (present day Taiwan) who formed the Republic of China (ROC) and Mao formed the People’s Republic of China (PRC) over the rest of China.

431 Km/h or 270 mph on the High
Speed Rail line

            The centralized government has several distinguishing features.  It allows the government to direct policy swiftly and efficiently.  This has resulted in phenomenal economic growth in China.  Over the last 30 years, China has experienced a GDP growth rate hovering around 10% per year.  China’s GDP, after adjusted for inflation and cost of living differences, is approaching that of the US’s ($16.7 trillion in 2013) if it hasn’t already passed it.  So China will become the largest economy in the world.  But really, so what?  China has 1.35 billion people, the US has 325 million (.325 billion).  So China has over four times as many people as we have.  You wouldn’t expect a small country like Switzerland to out produce a big country like the United States.  Likewise you wouldn’t expect the US to out produce China.  Also remember that China after World War II was a third world country.  After the war, China reformed itself and has been catching up with other countries ever since.  Starting from a lower level of productivity it’s easier to have high rates of growth.  As time passes, however, growth becomes more difficult, the low hanging fruit of progress has already been picked. China’s rate of growth will slow as the economy catches up.  

Typical housing complex

          Furthermore, even if China’s economy is bigger that ours, Chinese citizens are not better off.  Using the GDP per person as an estimator for the citizen’s wealth, China’s GDP per person is about $12,000 per year in 2013 after inflation adjustments while the US has about $53,000.  So the US population, in general, enjoys a higher standard of living.  While we were in China, we were graciously allowed to have lunch in what I believe to be a typical Chinese apartment.  The food was good and plentiful.  The apartment consisted to three rooms, each about 12 to 15 feet wide and 12 to 15 feet long, aligned in a row.  The first room was the dinning room, the second the bedroom and the back room was the kitchen.  The bathroom was provided for by a public bath down the block.  In spite of the fact that the hostess was very hospitable and kind, the dwelling was modest by any description.    

China per capita GDP compared
with other countries, World Bank Dec 2014

          Another feature of a central government, as you may guess, the powerful will do everything they can to stay in power and to empower and enrich themselves through graft, criminality and nepotism.  The people are, of course, aware of these actions and, according to Tiger Head Snakes Tails by Jonathan Fenby, previous editor of South China Morning Post, there are about 180,000 protests a year on such matters.  Occasionally public officials are arrested and jailed by the government.  But I believe most of these criminal actions go unpunished.  Relatives of Xi Jinping, the new Chinese leader, has assets of $376 million while outgoing Premier, Wen Jiabao, has asset of $2.7 billion.  Forty per cent of the private wealth in China is held by 1 per cent of the population.¹⁾  Unfortunately, and surprisingly, in the United States in 2010, wealth was also distributed almost as un-equally, 1% of the population own 35.4% of the wealth.²⁾ Distribution of wealth is important because it portrays how the common citizen partakes in the economic success of a nation and how widely the wealth is spread throughout the country.  For right now, the US is the leader of the financial and democratic world, but based on distribution of wealth statistic, this may not always be the case.   

 

1) “Tiger Head Snake Tails, China Today, How it got There and Where it is Heading, ”, by Jonathan Fenby, The Overlook Press, Copyright, 2012

 

2) “Who Rules America? Wealth, Income and Power,” G. William Dornhoff, Socialogy Dept, University of California, Santa Cruz