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Wyatt Smith, Keegan Traveling Fellow

Wyatt Smith

2010-2011 Michael B. Keegan Traveling Fellow
Vanderbilt University

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Dec '10

24 Hours in Beijing: An Introduction to the Paradoxes of New China

My good friend and fellow Vandy graduate Tyler Godoff, who works with a Chinese state-owned shipping and logistics firm in Beijing, was waiting for me to step off the plane with this welcome banner. Go Dores!

After a brief respite in the United States, my traveling fellowship leads me to set out for China, the world’s rising power in the East. Growing up, I always viewed China as a country shrouded in mystery, a “communist power” on the other side of the world. It seemed like a place of immense factories, expansive cities, and an indecipherable language. My knowledge about the country grew with time, but my first visit still feels like pulling back the curtain that covers a place so widely discussed by the West, yet so little understood.

On arrival, a number of things immediately stand out as noteworthy. Most gripping is the scale. As a country of 1.3 billion people, China is home to a fifth of humanity, all cramming streets, shopping markets, and subway stations. A “second tier” metropolitan area like Dalian, a quickly urbanizing seaport in northeastern Liaoning Province, boasts over 6 million residents, more than the population of metropolitan Houston. Not too shabby for a place whose name few Westerners will recognize or pronounce correctly.

Estimates vary depending on units of measurement for metropolitan areas, but most agree that more than 150 Chinese cities have population totals above 1 million. The United States is home to nine. With such a large population, China’s economic potential looms large. Foreign interest in the emerging Chinese market has grown considerably in recent years, as the relaxing of economic policies allowed for potential investment: Thousands of Western businesses have set up offices in the burgeoning financial center of Shanghai and the historic Chinese capital of Beijing. And thousands more benefit from the cheap labor and capital inputs that feed the manufacturing beasts of Guangzhou and Shenzhen. But for all the outside investment and worldwide interest in the Chinese market, the country’s economic and political systems remain cloaked in mystery.

Towering skyscrapers and busy freeways are the norm across China, which is on pace to surpass America as the world's largest manufacturer this year, according to the Financial Times. My first day in Beijing served as a practical introduction to the unique nature of state capitalism in modern China.

Memories of massive famine and forced labor during the Great Leap Forward and the Cultural Revolution may still be on the minds of some older observers of the Communist Party of China, but contemporary watchers understand that China’s days as an economically communist system are long past. Since Mao Zedong’s death in 1976 and the institution of Deng Xiaoping’s “opening up” policies in the late 70’s and early 80’s, the “Revolution of the Worker” has given way to a climate of fierce competition and capitalism.

A short walk around Beijing reveals the power of the market in China today. International chains dot many street corners, towering office towers rise on the skyline, and cart vendors exploit every opportunity to sell magazines, food, or pirated DVD’s to anyone with a spare yuan to offer. Yet for all the aspirant entrepreneurs, reminders of China’s strong centrally controlled system are ubiquitous as well, taking the form of uniformed guards, security cameras, and the “Great Firewall of China,” which blocks errant Internet searches and Facebook users alike.

I get my first view of the relationship between historic communism and China’s new market economy hours after arriving in Beijing. On a frigid morning in historic Tiananmen Square, I fend off the advances of a hat salesman, eager to capitalize on the freezing temperatures by selling warm headgear. The hawker chased me through the square, shouting prices for his wares under the shadow of Chairman Mao’s tomb, where the father of the Communist Revolution lies in a formaldehyde-preserved state for all to pay tribute.

While brokering a price, the vendor drove as persistently and aggressively as any in Times Square. Even though the eternal presence of Mao, China’s iconic decrier of capitalistic exploitation, loomed yards away, it didn’t stop the hat and glove vendor from exploiting his market advantage in the below zero temperatures of Beijing.

A persistent hat salesman convinced me to purchase this attractive-looking hat on my first, frigid morning in Beijing. Pictured here with a fellow attendee at the Tiananmen Square flag raising ceremony. Chinese soldiers and the Forbidden City lie in the background.

After donning my hat (pictured at right), I joined the masses of people from across China gathered in Tiananmen Square to witness the dawn Chinese flag raising ceremony, Beijing’s daily nationalistic ritual that draws pilgrims from every corner of the country. The Red Army stood at rapt attention as the honor guard paraded out of the Temple of the Forbidden City, just under the balcony where Mao famously led revolutionary slogans with the masses, and into the Square to display China’s colors. Seconds after my encounter with the free market, I felt as though I plunged back into Red China.

A short walk later, this capitalist/communist paradox continued as I ate breakfast at KFC (one of the 3000 Colonel Sanders franchises in China, Yum Brand’s fastest growing market) before strolling through the magnificent People’s Hall, which serves as the seat of the Chinese government. The ratcheting dilemma built with a visit to the Forbidden City, the previous home to 24 Chinese emperors, where the young university students who swarm as independent tour guides are a far cry from those who terrorized the city as Red Guards just forty years ago.

At each point, the edifices of imperial and communist power made a huge impression, but it was the burning desire of all around me to capitalize on opportunities to sell, sell, sell—from watches to lasers to Forbidden City collectibles—that stood out the greatest.

Soon, I realized that the division was a mirage: In today’s China, socialist government and capitalism are one in the same. The two blend in the most natural of ways, creating corporate giants with politically appointed CEO’s, each dependent on the stability of the other for success and longevity.

I found a clear representation of this hybrid while searching for a SIM card at the end of my first day in China Mobile, the state-owned cell phone giant who commands a $200 billion market cap and 70 percent of the Chinese domestic market. China Mobile is the phone card to have in China; no other company offers the same network coverage or rate schedule. The government ensures its monopoly in different ways: For example, China Unicom (China Mobile’s closest competitor) users can’t find a signal in any of Beijing’s subway lines, whereas China Mobile offers its clients crystal clear reception. From a personal economic standpoint, there is no incentive to do business with anyone else.

But to purchase a SIM card for cell phone, I had to cede nearly every possible piece of information on my person, including my temporary residence address, passport copy, email address, American address, and alternate cell phone number. All were dutifully filed away in the computer systems of the People’s Republic of China. I was, so to speak, “on the grid”.

The China World Trade Center, completed in 2009, is a towering building in the heart of Bejing that represents "new China" as a home to mega-corporations, upscale hotels, and international conferences. I capped my first day in China with an interesting foray into a P&G runway show after arriving here on, of all things, a bicycle.

I don’t mean to insinuate that China Mobile, or the Chinese government for that matter, had any nefarious intent behind collecting my personal information. Neither this experience with government officials, nor the more intensive one, in which I had to register a temporary address in China with a police station in the Chaoyang district of Beijing, left me with the impression that “Big Brother” in China had any ill-will towards my being in the country as a traveling lao wei (old foreigner).

But the experience was the first of many encounters that shaped my understanding the unique nature of “communism with Chinese characteristics,” as the China’s people like to term their system. While the monuments of the Worker’s Revolution still loom large—there are few more impressive state houses than the People’s Hall and Mao’s portrait still peers watchfully onto Tiananmen Square from his former perch at the Forbidden City gate—the heady days of class struggle have been replaced by an era of government pragmatism, development, and long-range planning, all characterized in the form of neatly-outlined five year plans. Today, China’s priorities center on profit, not the proletariat.

Fittingly, I finished my first day in the glimmering China World Trade Center, where I stumbled into a winter fashion show featuring beauty products from the production giant Proctor & Gamble. Accompanied by a friend as eager as me to crash the event, I stashed by backpack and jacket under a bathroom sink and feigned my way into the ritzy affair, complete with paparazzi, Asian models, and a six-course meal.

To explain our presence, my friend and I spoke vaguely about using the Internet to connect China’s emerging middle class with a range of beauty products, but mostly we hung back and observed the ostentatious scene before us. In a display of bourgeoisie unthinkable just a few decades ago in China’s capital, a diverse mix of young professionals sipped champagne and chattered about the latest developments in fashion around the world. Lobster, expensive wine, and breathless commentary on P&G beauty products awaited us inside the ballroom, where regional celebrities paraded about a runway, preening for magazine writers and product merchandisers in a manner far more evoking of Milan than Manchuria.

We slipped away from the decadence after an hour or so, but at the end of my first twenty-four hours in China, the point was clear: Not everyone in the West may understand the shift, but today’s China is a far cry from the picture of the past. The government’s power, although no longer inspired by Maoist Thought, remains strongly evident and forceful in public life. But with its laser-like focus on development, the Communist Party of China has channeled its might to unleashing its masses of producers and consumers into the world economy. And it’s emerging as a new land of opportunity in the process.

1 Comment »

1 Comment » to “24 Hours in Beijing: An Introduction to the Paradoxes of New China”

  1. Erin Smith Says:

    Are capitalism and communism compatible? Engels and Marx are rolling in their graves. From the Boxer Rebellion to Procter and Gamble, in 110 years.

    I am fascinated by China’s emergence as a global power, but I contend the most radical change in China’s social structure began in 1979, with the One Child Policy, and we will not see the real shape of China for another twenty years, when the children of that generation reach full maturity and political dominance.

    The children of the Cultural Revolution are just now reaching political dominance,and will continue to shape government and social policy for the next twenty years.

    When you consider that China has compressed the 300 year history of the Industrial Revolution into
    100 years, it is not surprising that she should suffer such political and social turmoil. The story isn’t over yet. In fact, it is only beginning.

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