The Two Chinas (China: 4 of 5)

Wuxi is a "medium-sized" Chinese city, but when you're downtown, you could be pretty much anywhere. Givenchy and Dior, Citibank and Nike surround you, and smartly-dressed, high-income young people swarm around you to get to the shops and stimulate the economy. Moms struggle to keep the youngsters in line and kids demand new toys. Even though Wuxi isn't the cutting edge of international cities in China (for that, go to Beijing), the downtown shows a future direction for China: brand-conscious and consumer-oriented, rapidly increasing in wealth and confidence. Egalitarian for opportunity and especially for gender.

This China is reinforced by the bank-built skyscrapers, the export industries, and the miles and miles of high-tech indsutrial factories that surround Wuxi.

The other China is still lurking around, though. The bureaucrats are omnipresent, playing an even bigger role than in Japan. Scarily, their promotion depends on real estate: the more impressive industrial parks built on the mayor/governor/director's watch, the greater the chance he'll be promoted. While this sytem, when it works, produces rapid development in a way we can't imagine (the line at one presentation was: "everything takes half the time in China"), it has a built-in tendancy to overbuild, an expectation that demand for real estate will come into existence merely because the buildings are built, and a built-in tendancy to collusion with the real estate moguls.

Going with that is the lack of trust in the market. In China, 1/3rd of the GDP is still from state industries, and the government's reach extends far outside of that third. Decisions about which industries are valuable, which shows should be shown on which channels, and a million other items we have long since assigned to the market's invisible hand are still governmental fiat in China. The Chinese I met are *very* educated about the outside world, so they understand this well; they're just not ready to let all these elements of culture loose.

I'm betting on the first one, though: the Chinese I met were all hard-working, enaged in their lives and their country, and looking for help in order to build it. As they move up the socioeconomic scale, they'll create a domestic market for products which will dwarf any other national market -- there are, after all, a billion Chinese people -- and most of the products to fill it will, convienently, already be built in their own factories.