Sunday, April 04, 2010

China's Weakness - Reflections on a Two-Month Stay in the Hinterland

I've been thinking a lot lately about something James Fallows, former China correspondent for The Atlantic Monthly, said. "China has many more problems than most [people] can imagine, and its power is much less impressive up close," he wrote earlier this year. Having just returned from a two-month stay in Zhaoqing, Guangdong province, a city seemingly condemned to permanent 'third-tier' status, Fallow's observation resonates. Bombarded, as one is in western Europe, with news of China's inexorable rise, its single-handed salvation of the world economy, its world besting infrastructure projects, its can-do spirit, its new billionaires, its gobbling up of African and Latin American resources, its super-smart hackers, its warehouses stuffed with US treasuries, its easy to get a serious inferiority complex: China is the future, the west is spent. We might as well start kowtowing now in the hope of mercy down the line. And then one spends time in China, away from the glitz and glam of the showcase cities, and it takes only a very short period of time to realise the idea of 'China as superpower' is quite preposterous.

None of this should surprise me. I've lived in China long enough to know better. However, the power and penetration of the news media's favoured narrative on China is overwhelming, particularly if you take your lead - as I increasingly do these days - from the business press (it feels almost galling to write those words, but I canne deny the truth. I'm a paid-up Economist subscriber). The reasons for the existence of this favoured narrative are, I suppose, complex, and range from the political (a need for a more easily defined model of an 'enemy' than any that Al-Qaeda could provide), the historic (the near-destruction of our entire socio-economic system in 2008 opening up the possibility that there may be an alternative), to the pyschological (the confusing attraction-repulsion one feels towards hulking brutes [think of China as a nation-state Stanley Kowalski]). However, an important part of the explanation must lie in the fact that those charged with reporting China to domestic audiences back in the west are, to a man, based in the showcase cities, immersed in a sub-strata of Chinese society which I know, from experience, to be tremendously exciting, impressive and utterly unrepresentative. Obviously decent reporters will routinely get out and see life outside the FCC bubble but its my suspicion that, regardless of a journalist's professionalism and work ethic, the bubble in which they exist will come to be seen as the norm, with the impoverished, brutish and backward hinterland being seen somehow as exceptional and exotic. Wen Jiabao, the Chinese premier, made a similar point during the recent NPC when he urged overseas journalists to get out and report more of China's problems (presumably as a means of easing political pressure by dampening expectations of what China can and can't do).

China is an increasingly polarised society. Yes, there does exist a supremely impressive, educated, forward-thinking elite asking really interesting questions in science, engineering, and IT etc. which exists almost exclusively in China's major metropolitan centres (Beijing, Shanghai, Guangzhou, Shenzhen, Chongqing), cities that are, in parts, genuinely developed and genuinely impressive. But, for my money, rather than leading China into its destined golden age, it seems this elite (and perhaps even this group of 'first-tier' cities at large) is growing more and more distant from majority China, which languishes, frankly, in mind-boggling inefficiency and ineptitude. If superpower status is conferred by statistics, China is doing just fine. If it is conferred by genuine economic and political strength, China is a long way from where it needs to be. Much is made of China's double digit growth. Yu Yongding, a researcher with the Chinese Academy of Social Sciences and a former member of the central bank's monetary policy committee, said in 2008 that for China, "a growth rate of less than 9 percent could be called stagnation, while other countries would regard it as high growth." Seeing life up close in small town/city China, I suspect more and more that the reason for this is that the nine per cent is cooked by government investment, much of which is squandered in inefficiencies, and bank loans which are unlikely ever to get repaid, with only a few percentage points of genuine, real growth. Heck, I'm no economist, and its probably unbecoming for me to try to write like one. I am fairly sure that anyone who relies on official statistics in China is playing a dangerous game. I guess all I know for sure is what I have seen, and what I see is astonishing inefficiency in a system - a public system at least - that operates according to knee-jerk dictate, and that remains entirely blind to genuine need. Anyone who retains faith that the Communist Party of China can reform itself, along with the nation it governs, is ignoring both the reality of life in majority China and the very powerful lessons of history.

My chief piece of evidence to back this up is the 'redevelopment' of Xinghu Dadao, the road that runs in front of the place I've stayed for the last two months. The major change has been to widen the road to four lanes each way, which is itself an inefficiency as two lanes would be more than sufficient were drivers educated to actually understand and follow basic rules on the road (as opposed to adopting the current Darwinian system whereby haulage trucks do as they please and scooter drivers give way obligingly, regardless of logic, decency or right of way). In the eight years that I've been in or around China, nothing has changed in this regard. My wife cannot drive for toffee but has a driving licence earned by holding the steering wheel of a large truck as it made a straight path along a highway for a few miles. But that's a whole other story: back to the matter in hand.

Xinghu Dadao has been earmarked for redevelopment for some time and, during my last visit, back in June 2009, work was underway. Familiar as I am with the whole 'China sprouts skyscrapers quicker than vegetables' cliche (mainly because I've used that exact cliche myself in some of my more frothy travel writings on China), I fully expected the project to have been finished by the time I got back to Zhaoqing in January this year. It wasn't. The chief change was that the pleasant greenery in the central reservation and the large roundabout just below the apartment window had been replaced with freshly churned earth in anticipation of a totally unnecessary new layering of greenery. Nevertheless, almost as soon as we got back, there was a flurry of activity. The roads around the roundabout were macadamized with indecent haste (aside: I have spent years wondering why roads in Zhaoqing were not tarmacked in the same way as they were in, say, Hong Kong. My wife's answer, very typical in China, was that, somehow, conditions locally were sufficiently 'different' to render this technique to be 'unsuitable'). Work began at 6.30am and, one night at least, went on till past 3am. It didn't take a huge leap of logic to figure out that somebody in local government had their eye on Spring Festival, two weeks away, and had a promise to keep. And then, suddenly, everything stopped. Spring Festival came and went, and still tools stayed down. Some time soon after a lone workman came and drilled the area around one of the drains in the newly finished road, leaving a gaping hole virtually in the middle of the road. A flimsy cordon was erected and remained there until I left last week.

The pavements were equally as haphazardly done. Large swathes of the hugely oversized new walkway had been complete, but no one section was properly finished, so that - if you were, as I was - walking with a pushchair, you were better off on the road. As with so many things, pavements in China are there to create the impression of modernity and convenience, but try and use the damn thing as a pedestrian and you'll soon realise where priorities really lie. The chief problem was that the work was patently being carried out by people who had no clue what they were doing. I walked past the workers on a daily basis. They spoke Mandarin and looked every part the 'migrant labourer'. They appeared good, decent, honest people. But the fact remains that clearly nobody had ever trained them to do the job they were currently doing, and for all their sweat, they were doing it badly. I was only in town for around two months and some of the sections that were freshly paved back in February were actually falling apart by March.

The same was true of every aspect of the work. Trees were torn out and replaced by near-identical trees etc.etc. I talked to many people about this. My wife's argument was fairly typical: the incompetence was quite deliberate. Leaders wanted to do the job badly so that it could be done again in a couple of years time. Or, conversely, they had no interest in ensuring it was done properly as they would be moved onto different projects, different places by the time things began falling apart. To my wife, such a project was merely a means for local leaders to earn money from contractual kickbacks etc.etc. I tried to argue that at the macro level, you can't really 'make money' by wasting money. Somebody, somewhere, has to pay and the needless haemorrhaging of money and resources is damaging to both the economy and to the environment. But the more I thought about it, the more I began seeing, and understanding the short-term logic of this Soviet-style central planning system. Employment is bolstered, local industry is boosted and leaders are happy. As long as someone else is paying, things are fine. But the question remains: who exactly is paying?

Some time later I rode out past the newly paved section of Xinghu Dadao. About a kilometre east, the road disintegrated into dust and ruts. A friend suggested that it would be years before this section was worked on as it was not part of the central showcase zone. In China, a road to nowhere is a very useful thing political. Those trying to use the road for a more traditional A-to-B purpose are not the priority, clearly.

Xinghu Dadao is just one example is how things work when one gets out of the major metropolises and runs into the brutal backwardness of small-time China. There are many, many more. Sometimes it felt as it everything in Zhaoqing was built in order to disintegrate. Nothing lasts, nothing is preserved. Everything is run into the ground, trampled by the sheer weight of numbers and scuffed up and manhandled by a society in which there is no notion of the common good, and no sense of needing to work together to maintain and preserve. Out in Zhaoqing, community has ceased to exist, it seems to me, and selfishness is almost pathological. The universal hopelessness in the face of the power of local government has absolutely created the justification for almost everyone - ordinary, normally honest people - to act with total selfish abandon on the basis that everyone else is at it. There is no sense of participation, only a stoic acceptance that things are the way they are and that one needs to find a means of getting by in spite of the adversity.

All of which has given me the very distinct impression that, for all the headlines, and all the achievements, and all the bluster, China - try as it might - will never be able to defy the lessons of history. The stitches will come unpicked; the train will judder off the rails; the steamroller has to run out of fuel - use whatever metaphor you like. To reiterate, I'm no economist, I'm no politician, I'm not even an 'expert commentator'. But I do feel emboldened by knowing that my perspective on China is from that of 'majority China' - the small, slightly backward, 'developing' city - and, boy oh boy, it's not a pretty sight.