In the heart of downtown Chongqing, a sprawling city-state in Western China on the banks of the Yangtze River, a six-story tower commemorates those who died in what the Chinese call "the anti-Japanese war." After Japan invaded in 1937, the government moved the capital of China upriver from Nanjing to Chongqing. That decision brought with it Japanese bombs, and the city was destroyed during the war. A year after Mao Zedong founded the New China in 1949, he commemorated the fallen with the People's Liberation Memorial Tower. I was told by a guide at the city's exhibition center that just twenty years ago the memorial was the tallest building in the city. Today, the tower sits in the shadow of at least three mountainous skyscrapers in the central business district. Situated at the intersection of a pedestrian shopping mall, the tower looms about as large on the Chongqing skyline as a hotdog stand on Manhattan's.
My first trip to China--sponsored by the China-United States Exchange Foundation--came just over a month after the People's Republic celebrated its sixtieth anniversary. Those six decades can be cleaved in half: the first act, 1949-78, were the years of Mao, famine and the cultural revolution; the second, the three decades since then, the years of Deng, "reforms" and the "opening up," as the Chinese call it. And yet as far as China has come in terms of wealth (and the concentration thereof), it remains a very poor country: it ranks 100 among the world's nations in terms of per capita GDP, according to the IMF. "Our biggest challenge is not from without but from within," Yang Jiemian, president of the Shanghai Institutes for International Studies, told us, citing (obliquely, as the Chinese we talked to were wont to do) the potential for instability as China continues on its trajectory. "It has become the consensus of the elites that China should stay on the right track: the past thirty years have resulted in remarkable achievements in all aspects of China. We hope that in the same vein, but in different emphasis, China could have another thirty years."
But is another thirty years like the past thirty even possible? The third act of New China begins as a world financial crisis reveals the deep flaws of global neoliberal capitalism and as a diminishing fossil fuel supply and rising global temperatures escalate the competition for resources. Meanwhile, China is in the midst of the largest project of industrialization and urbanization in human history, one that requires massive amounts of capital and fossil fuel. It's like watching a jeep race up a mountain road as an avalanche begins to cascade downward from above.
At a tour of a car factory in Chongqing, the guide from Chang'an Motors pointed to the boxy gray minivans rolling off the assembly line and, beaming, said, "There are 800 million Chinese peasants who need these cars!"
He's right, of course. China "should not be expected to stay forever as a bicycle kingdom," as Yu Qingtai, special representative for climate change negotiations, told us. But 800 million new cars--think about that for a moment.
What's happening in China is at once awe-inspiring and monstrous. Its mixture of planning and markets, autocracy and federalism, competence and corruption both supports and refutes every argument one could make about models of political economy. There is a risk, after two weeks in a country of 1.3 billion people, of falling prey to false certainties: like a traveler airlifted onto the top of Mt. Kilimanjaro who returns home to tell everyone that Africa is covered in snow.
This danger was compounded by the fact that the trip was sponsored by an independent, Hong Kong-based nonprofit whose founder, Tung Chee Hwa, the first Chinese chief executive of Hong Kong, is very close to the Chinese leadership; and our hosts on the mainland side, who chaperoned us from interview to interview, were Communist Party members and former government officials. We had a few painfully staged interactions with "ordinary people" (including an elderly tangerine farmer who couldn't remember the year of a specific agricultural reform but knew that it was during the "5th plenary of the 16th Central Committee").
We did, however, have an opportunity to speak with dozens of members of the Chinese elite: officials, academics and businessmen. And China happens to be a country where the elites hold tremendous power. Indeed, they seem to have seamlessly melded Leninist vanguardism with American-style best-and-brightest meritocracy: "Let me put it simply," said former Shanghai mayor and current president of the Chinese Academy of Engineering Xu Kuangdi. "Most successful businessmen or scholars or engineers--they have become party members of the CPC."
China's New Deal
There is no formal social contract that regulates the relationship between members of this ruling class and the people they rule, but there does seem to be an implicit one. It is roughly this: we (the government) provide you (the citizens) with 8 to10 percent annual GDP growth, 24 million new jobs a year and the chance to win the capitalist lottery of sending your son or daughter off to a prestigious school with the promise of a life of industrialized luxury. In exchange: you don't question the legitimacy of the Chinese Communist Party.
This is not the easiest contract for the government to uphold, and it has already shown some signs of fraying. As recently as 2007, there were 80,000 protests a year in China, and the Internet has given a platform to increasingly rambunctious critics of government policies. The most potent issue is corruption, which captured wide public attention in the wake of the 2008 Sichuan earthquake, when many blamed corruption for the fact that school buildings that collapsed had dodged building codes. Several Chinese officials told us corruption was the biggest threat the party faces, the "threat from within," as one put it. Despite high-profile "crackdowns" (such as a trial currently under way in Chongqing involving 9,000 suspects), a recent China News Agency poll shows that corruption remains the number-one issue on the minds of Chinese citizens.
Corruption aside, there are also the raw economic challenges of maintaining hypergrowth, particularly at a moment of global contraction. Exports make up 35 percent of Chinese GDP; in the past year they fell by 25 percent. There are 6 million recent college graduates who need to find jobs. One Chinese hedge fund manager showed us an article for a newspaper about new graduates flooding a job fair, where the ratio of attendees to jobs was 7.5 to 1. What would happen, I asked one local party official in Yichang, a city near the infamous Three Gorges Dam, if unemployment in China went to 10 percent? Before he answered by saying that such a situation would be impossible under the current system, one of our chaperones, a very savvy diplomat who had served in the foreign ministry, leaned over to me and said, sotto voce, "The government would collapse." He chuckled after he said it, but I think he was only half joking.