Cowboy Capitalism with Chinese Characteristics, Part 2: A View from the Street

Despite the growth of inequality in contemporary China and the precarious means of subsistence for the lowest rung, few voices have shouted above the parapet to protect or increase the lot of the poorest. If we take Beijing, a seemingly booming metropolis, visible indications of inequality and economic problems can be found almost everywhere. In a brief walk through the prospering nanluo guxiang alleyways (南锣鼓巷) of the drum tower area, one can take in street after streets of trendy coffee shops and ‘international bars’, pay 40 kuai for a drink (equivalent to the daily wage of a waitress serving it), or be caught in the jam-packed streets of fashionable young Chinese shoppers dazzled by various arty, luxury consumer fashion items. In less upmarket areas 9 kuai can buy you a relatively healthy meal of noodles. Instead one can consult international entertainment guides printed in English to see adverts for concerts such as ‘progressive’ metal band Opeth for 680 kuai, about three times the price of a comparable UK concert (an upcoming Avril Lavigne concert costs 1700 kuai, about 170 UK pounds). You can then turn a corner and within seconds the streets are empty, the residents are aging, and the homes are without heating, running water, and toilets. The generation gap and the income disparities are visibly staggering. This is not simply about inequality per se but about access to the means of subsistence- a basic income, health, and education. Accessing largely privatised social services is not cheap and housing prices have exploded. For example, it costs about 400 pounds a month to rent a small studio flat with no cooking facilities in the Xiaoxitian area (a relatively affordable district adjacent to Beijing Normal University). This is much the same as a one person flat with separate rooms, a full kitchen and bathroom in Manchester, UK. Average income in the UK is $38,540 compared to China’s $4,260. No surprise then that small shop-owners still have beds in their stalls all over Beijing and rely on small heaters or electric blankets though the winter. Capitalism seems to inevitably produce winners and losers and this is perhaps most dramatic in its global phase where wealth and goods are not confined by national borders. The winners and losers here are worlds apart and there is little responsibility being shown by the winners.

Pun Ngai, author of Dagongmei, brings to light a serious contradiction in the claims of China’s opening up in the reform era. We ordinarily expect capitalism and wealth creation to thrive on social and spatial mobility; business and people have to be willing to move to where money can be made and profit found. However, while the Chinese system has privatised social services and to some extent opened its markets to global capital, it has not abandoned the household registration system (hukou). This divides citizens into urban and rural residents and ties residents to their place of birth if they wish access discounts to the most basic healthcare and early schooling still available under the system. This means the rich are increasingly mobile both in global terms (they can afford to travel abroad or go to see Opeth in Beijing) and in national terms because they can move to other cities and pay for private healthcare and schooling. This maintenance of immobility combined with skyrocketing housing prices has led to the phenomenon of what Pun Ngai termed “dormitory capitalism”; not only does the hukou system make the millions of migrants who move to the city de facto illegal aliens in their own country but due to the cost of housing many have to live in dormitories in basements owned by their employers rather than be made homeless. This provides a lifestyle completely at odds with representations of a rising, powerful China and in utter contrast to the nouveau-rich playing on their laptops and sipping high status coffee. Coupled with the fact that trade unions are de facto outlawed in China, this also enables the owners of such businesses a level of control over their employees such that the most marginalised (poor, rural women) are “instantly disposable” and in many cases cannot refuse to sell their bodies. Approximately 12% of China’s GDP can be accounted for by the sex trade.

I’ll offer a brief personal story of how the process of renting a house works in Beijing. This is written from the relatively privileged perspective of my partner and me. However, much can be gleaned from it to tell us where wealth goes and the attitudes towards it in Beijing today. We were advised by both Chinese and foreign friends that to find a house in Beijing, going through an agency would cost more but it would save us a lot of trouble and avoid the risk of being ripped off later. We explored the xiaoxitian area and discovered that there are perhaps half a dozen of such firms on every street! These firms manage large amounts of property for landlords who often own entire apartment blocks. The streets are not only decked in adverts everywhere but you can see their staff standing on most street corners waiting for clients or waiting for people to look at their adverts which also adorn many street corners. This is big business. Overhearing conversations on the street and in restaurants, housing seems to be the hot topic of the day- everybody needs it but most seem to be struggling to pay for it. We looked at a number of flats and studio apartments to little avail as our rough budget of 4,000 kuai (about 400 pounds) would only cover decaying flats with broken toilets or a tiny studio. Eventually we received a phone-call from an unknown number offering us help to find a flat. We assumed he was from one of the companies we had consulted but we eventually discovered he was actually a middle man to the middle men at the estate agents. He provided clients to the firms who make money finding clients for the under-rich landlords. We eventually met with him and spent the best part of a day or two chatting with him as we looked for accommodation. He offered us a reasonable deal, he said, because we were British. This was an offer he wouldn’t extend to Greeks and Italians in the Eurozone who renege on their debts! As most young men in Beijing, his life revolved around making as much money as he could to pay for housing, keep his family afloat, and save for the future. He claimed his wage for acting as a middle man to the middle men was about 10,000 kuai per month – light years ahead of the national average and equivalent to our individual incomes in the UK. When we discussed tax, he mocked the UK tax system for taking money away from people (China’s income tax is a rate of about 20% for those making more than a very healthy 5,000 kuai a month). He audibly scoffed at our suggested notion that this money could be used to help society. Socialism remains comedic and kitsch amongst China’s youth. In fact, he described life and business in China, in the same way as many here, as “people-eat-people” (ren chi ren; 人吃人). Competition is so fierce here that people believe it demands that one pursues wealth and self-interest without responsibility to others outside one’s family, let alone any socialist commitment to aiding the poorest rungs of society.

After looking at a half a dozen flats with him, we eventually had to lower our standards. We accepted a reasonably sized but decaying and concreted floored flat with a bathroom I could barely stand in. It seemed quite pleasant compared to others we could afford. When we arrived to sign the contract, a problem emerged. Every foreign national in China has to register themselves and their address with the local police station. However, the landlord insisted we register with a fake address at a different station because it would be “more convenient”. This was a way for them to avoid taxes on the rental income as well as the fee associated with this registration. They either had relationships (guanxi; 关系) with police or a landlord in another part of town. Knowing that if anything went wrong we would be the ones in trouble and would probably be sent home, we opted to find somewhere else despite having spent the better part of a week looking at houses. The only way we could both afford to live in Beijing would be in a small and relatively old studio flat. We found such a studio flat in the xiaoxitian area thanks to our anti-Euro middleman to the middlemen in a relatively nice apartment block. We were quite satisfied.

At this stage we still thought our man was just an ordinary middle man but on settling to sign the contract, we realised that this wasn’t the case. An employee of an estate firmed arrived with the contract, refused to say a word, drew up the details, pointed and said ‘sign’. We insisted we read what we were signing up to. He was clearly annoyed but would tolerate this. Our man told him “don’t worry, foreigners are all like this, they just take contracts seriously”. Relationships may be more important than law in China but as travelling foreigners without any networks we opted to stick to the law. On perusal of the contract it turned out they were adding 9 days onto the 6 month lease we agreed. The company man repeatedly urged us to sign as it was “much the same” and would only grin when I said if it is much the same, then change it! After much to-ing and fro-ing I told the company man that I didn’t want to give 1,000 kuai for nothing to a rich landlord. This he found amusing. He agreed to reduce the additional time to 7 days, even though he had claimed it was impossible due to the contract he had with the company who had a contract with the landlord! We both realised this was how these cowboys make lots of money. He, along with hundreds of other agents, was travelling round town all day. If they made a free thousand kuai off every customer they were raking it in without even considering the profit from their legitimate business. After much consternation and urging us to sign, the agreement was made that the original middle man would take the additional cost out of his ‘finder’s fee’. He had of course told us that this would be reduced earlier but now there was no chance- we had to pay him a full month’s rent in cash with no tax paid just for the sake of a few phone calls. No wonder he makes a good wage. The pair of us were then hurled onto the back of a small motorbike and driven to the company office bouncing off a taxi on the way. The company man, who had seemed so aloof and high status from our first meeting, refusing to even engage with our middle man, was suddenly in a different social position. He was being shouted at by his boss and providing us with a place to sit and a drink in this bustling office where multiple deals were being negotiated all round us. The boss grilled him on how much he had got for the flat. He seemed pleased with the 3,500 kuai per month we agreed to pay. All of a sudden, the rate seemed like it had been negotiable and we guessed that the company weren’t just making money as a set fee from the landlord but were probably creaming extra cash off by charging us a higher rate than what they were telling him. I would doubt the taxes are being paid.

The inconvenience of all this was tiresome but quite amusing and a good learning experience. The real story is that so much money is slushing around, tax-free and destined for landlords’ pockets, that multiple middle men can still make a healthy, largely tax-free living by knowing the market but doing very little. This opportunity would not be available to the additional illiterate 30 million adults who merely happened to be born in a poorer hukou (household registration area). Adam Smith and Karl Marx both agreed that under capitalism, the arduousness of labour is inversely proportional to the profit made from it. When we think back to those having to live in their shop-stalls to survive or living in dormitories and basements selling their bodies, this is clearly the case in contemporary China. National television (CCTV) devotes hours to heart-warming stories of peasants, who have to work endlessly without complaint to pay healthcare bills or send their kids to school, as examples to be admired. Perhaps regulating the cowboy capitalists and using taxes to pay for schools and hospitals, instead of mega-pr events like the Olympics or indeed a nuclear arsenal, would mean the poorest wouldn’t have to be admired for the hardship they endure.

Commodified Communities: Selling the Nation in a Global Age

Patriotism and consumerism appear to have no obvious connection. The nation as a bounded community of people who identify with one another appears to stand in contrast to the workings of global capital which flows across borders in the search for profit not social recognition. Production and trade have been transnationalised to the extent that ‘Buy American’ and ‘Buy British’ is impossible when buying any consumer goods made of more than a few simple parts. A single computer may be designed in Silicon Valley, built in Japan, assembled in South East Asia, and dumped in China when past their sell by date. However, we still see a growing clamour to sell national pride and to commercialise the boundaries of belonging. Since 9/11 Wal-Mart expanded its sale of flag-emblazoned merchandise for sale with “respectful” and “patriotic” flag disposal services in stores for used flags positioned conveniently next to shiny new ones. In 2004, Wal-Mart was voted the most admired company in the US despite facing criticism for its unfair wages for women, de-unionisation, and monopoly practices. Professor Jennifer Scanlon says “the American Public and Wal-Mart are complicit in a performance of patriotism in which consumerism stands in for more concrete and difficult civic work”. It is easier to buy belonging in a community than to work to make it a better place. This is a reciprocal relationship between consumerism and nationalism such that transnational companies sell the nation and the nation buys it. This dynamic where consumerism and nationalism reproduce and reinforce each other is not restricted to the US. In China, Aigo is one of the nation’s leading electronic companies and is now a sponsor of Manchester United FC. The name Aigo in Mandarin Chinese (aiguozhe; 爱国者) means “patriot” and this is not lost on Chinese consumers seeking to “buy Chinese” in an age where their consumer options are transnationalised. One of the most frequent seen adverts on Chinese state television (CCTV) between 2009-2010 was for a medicine brand which ended with the catchphrase “mother I love you, motherland I love you” (mama wo ai ni, zuguo wo ai ni; 妈妈我爱你, 祖国我爱你). Viewers are then left with the impression that loyalty to a consumer brand equates to loyalty to the nation. You can buy belonging in a national-consumer community.

How people choose to spend their money has long been represented by states as linked to their identity as members of the nation. One of the many propaganda cartoons produced by Walt Disney in the first half of the twentieth century represented American consumers as divided between spending and saving. Scrooge McDuck tells Americans they must “save for victory” in World War 2. Spending money was un-patriotic because it helps the rise of Fascism by draining the treasury of tax resources. Of course representations of the nation have changed as capitalism becomes more and more globalised and it shifts from supply-side economics to demand-led. One of the first public addresses by President George Bush after 9/11 was to stress the threat of terrorism to our ever-expanding consumerist lifestyle linking shopping with national security: “We cannot let the terrorists achieve the objective of frightening our citizens to the point where we don’t…conduct business, we don’t shop”. “We” are being defined as shoppers and the threat of terrorism is to our “we-ness” is through the danger presented to our consumer-lifestyles. More recently, David Cameron defined Britishness through our economic behaviour during the “financial crisis”: “Some say that to succeed in this world, we need to become more like India or China, or Brazil, but I say: we need to become more like us. The real us. Hard-working, pioneering, independent, creative, adaptable, optimistic, can-do”. In practical terms Cameron continued to stress we pay off our credit card bills, tying national loyalty to stabilising financial capitalism. It seems patriotism is emerging as a resource our leaders can draw on to demand the economy works in specific ways. “Can-do” or “stiff upper lip” means “flexible” labour protection policy and a “disciplined” labour force in the words of the IMF. Cameron is using patriotism to tell people in Britain that they are not like Indians or Chinese, we are different. We should supposedly keep it that way by paying off our credit card bills and working hard and without question in a labour market that has seen employment slump and benefits slashed since the Conservative Party came to power. To be British means to behave in ways which maintain the workings of capitalism as it currently works- don’t’ complain about anything or you aren’t “can-do” and you aren’t British. For Cameron, it also means we should identify with billionaires within our borders who benefit from inequality instead of Indians and Chinese who suffer from it.

The recent public debates over the wearing of the poppy for Remembrance Sunday are a case in point. Turnouts at the cenotaph for actual remembrance are relatively small and co-ordinated through active organisations such as the British Legion. However, more passive consumers can now purchase all manner of goods from ties to caps to umbrellas to cufflinks to tablecloths in order to display their level of patriotic devotion and stand “shoulder to shoulder with all those who serve”. Judging by the Poppy Shop’s apology on their website in November 2011 that orders would be delayed due to a high volume of orders, it appears the British public are keen to buy their community membership. However, they are less keen to do “concrete and difficult civic work”. Joining a campaign, for example, to give an hour of one’s time to look after elderly veterans who are now in Britain’s understaffed nursing homes would be of more benefit than wearing a poppy. Wearing of the poppy to symbolise national belonging, which involves nothing but a small purchase, has in recent years been mobilised to the extent that it is framed as an issue of national security. The BBC linked tragic deaths of soldiers in Afghanistan, a very real and violent conflict, to the banality of the poppy. On Question Time, the popular British politics ‘debate’ show, Stephen Pollard, journalist and author on Israeli politics and history, claimed burning poppies should be outlawed, regardless of freedom of speech because they go to the heart of “who we are”. Identity here is framed as a security issue such that alternatives to this particular understanding of national identity are to be eliminated through force. David Cameron saw fit to demand FIFA, football’s ruling body, make the exception only for England to allow “political and religious” symbols on national football shirts in their game against Spain because it was a matter of “national pride”. Cameron and other Conservatives stressed that the poppy was “not political”. However, it is impossible to claim England’s supposed symbols of “national pride” are “not political” but those of other nations, which are banned on national football shirts, are “political”. This representation of the poppy as a performance of patriotism may not be new. However, what is new is this vigour that defines purchase and display of a poppy as the very heart of “who we are” and a symbol which is unquestionable and beyond politics. The English national football team have played on the 11^th November many times over the years and haven’t worn or asked to wear poppies on their shirts. This is but an example how of national communities become a commodified mode of self-understanding where alternatives are deemed ‘outside’ the boundaries of community. This follows the framings of how we organise capitalism and how we spend our earnings as security issues at the heart of our national identities. There are many ways to interpret why wars happen and whose interests they serve. However, the voices of those who see the First World War as a human tragedy which saw states across the world needlessly send millions of working class humans to their death are being excluded as un-patriotic because they don’t wish to wear the poppy. The poppy is said to represent them but it does not represent their views because it has become a symbol of “national pride” instead of remembering dead human beings. Today, identifying with humans who are victims of wars waged by Britain in Iraq and Afghanistan beyond our borders over those within our nation who send them to war is deemed unpatriotic in the same way that submitting to a flexible, unregulated labour market is essential to being British. Today, capital and people flow across borders but there is still capital to be made by going to war and selling its products under the banner of patriotism.

Apple and the Symbolic Construction of the Self/Other

It is not unusual to send condolences to family and friends of a recently deceased loved-one. What is unusual is when people are moved to grief for someone they have never met. It is not unusual to enquire why this is so. The death of Steve Jobs, CEO of Apple, led to a global outpouring of grief in the form of shrines from Beijing to California and from Seoul to Sydney. However, these are globalised, metropolitan centres where people who can afford to buy Apple’s exuberant products are concentrated. This is not reflective of some human community transcending divisions of geography and social class. These are relatively fortunate people commemorating the death of an incredibly wealthy man. Nonetheless, this public outpouring goes way beyond brand loyalty or the usual arguments that Macs are faster than PCs. These are highly symbolic rituals which tell us about who and what we value and who and what we do not. Jonathan Jones of the Guardian gushed that Apple products “made the world more beautiful” and “more human” such that Steve Jobs changed how “we” see the world. “We” refers here to people in metropolitan centres with enough disposable income to be part of this in-group. The inevitably corresponding “they” are the rest of the world, “outside” this group and presumably less human for their inability to enjoy these products.

It is tempting, as Alex Massie does in The Spectator, to dismiss these outpourings of attachment, grief, and worship for the CEO of a company whom they never met as "members of a cult that's just as stupid as any other and equally deserving of scorn and pity". However, this downplays the social significance in terms of both sheer numbers of people involved and the transnational scale on which unbridled admiration for the contribution of Apple to people’s lives we have witnessed. Massie also called this phenomenon iReligion and this seems a fairly accurate description given the blind faith and ritualised shrines we have witnessed. The Apple logo and Steve Jobs have become powerful symbols people express loyalty to and through which they identify themselves as free-thinking, modern individuals. Apple personifies something people want to be. The long running Mac advert series on UK TV exemplified this personification of the brand. It successfully anthropomorphised PCs to be like their users: old, traditional, and behind the times. Mac users then are symbolically articulated as young, fresh, and driving the times. The argument here is not to say Apple products are not fun to play with. They are. The argument is to say people in positions of relative fortune are investing their self-identifications in such products. These self-identifications are to the exclusion of the poor, globally marginalised Other. Ironically, these identifications are ultimately to the detriment as opposed to the enrichment of the individual.

Anthony Cohen’s 1985 classic The Symbolic Construction of Community applied decades of fieldwork in social anthropology on the intersection between social and personal identities. He produced a compelling argument to explain traditional community and nationalist loyalties. However, it equally illuminates why in the contemporary world when people are bombarded by commercial advertising demanding brand loyalty, and where struggles over local, ethnic, religious, national, transnational, and global forces regularly spill over into violence, we are still constantly trying to discover and rediscover where “we” belong and who “we” are:

“(symbols) ‘express’ other things in ways which allow their common form to be retained and shared among the members of a group, whilst not imposing upon these people the constraints of uniform meaning. Because symbols are malleable in this way, they can be made to ‘fit’ the circumstances of the individual. They can thus provide media through which individuals can experience and express their attachment to a society without compromising their individuality…what is actually held in common is not very substantial, being form rather than content.”

Apple and Steve Jobs like all the most socially effective symbols have no fixed content. They are pure form and they are malleable. They mean everything because they mean nothing. They are so abstract and open to interpretation that they are a marketing dream. Apple allows the individual to feel as if they retain and even enhance their individuality while at the same time spending more and more of their income on products they do not need and even worshipping at shrines of a dead man they did not know. The Apple logo perhaps speaks for itself. It is just an apple, it imposes little if any content yet people wear clothes and bags emblazoning the symbol on their journeys to find who they are. The soundbites of Steve Jobs, which appeared in their thousands across Facebook and Twitter on the day of his death, are a case in point. So devoid of content are they that people can imbue their own significance in them, participate in a social ritual, yet believe they retain some sense of individuality at the same time. “Stay hungry, stay foolish” is so open to interpretation that, as Cohen says, what is being shared by repeating it across the internet is insubstantial; form rather than content. This was of course a remarkably skilful and rhetorical manipulation of human needs for social and individual identities on Jobs’ part. People could be Apple users, a group, yet imbue their own supposed individuality on what that means. All the while Jobs got richer and richer. The most powerful of all the soundbites was perhaps “don’t waste time living someone else’s life”. In other words, buying Apple products, a socially significant action, allows one to be and become an individual. The irony is staggering when millions of individuals believe that by listening to another individual telling them to be an individual and buy his products he spent his life producing is somehow living one’s own life. Choosing to worship Apple and reproduce its messages across the potentially limitless discourse of the internet is a fundamentally selective social activity. People can say anything on the internet yet they choose to let Steve Jobs speak for them as if they are endorsing individuation. Monty Python once hilariously captured the irony of how groups can be convinced they are individuals in their film Life of Brian yet it seems to have been forgotten by Apple worshippers.

The power of Apple is remarkable. The internet has provided most people with staggering access to instantaneous information. This has led to unparalleled growth in global movements for social justice, human rights, and environmental protection. Yet while Twitter is used to organise the occupation of Wall Street in the world’s most “advanced” capitalist nation, we hear nothing from Apple users of Apple’s deplorable environmental record (reportedly the worst for any foreign firm in China) and disregard for labour rights across the world. Apple’s power is such that this information is freely available yet people choose not to google it and then choose to ignore it when it is presented to them. Karl Marx would say the exploitative social relations behind the product are concealed but here they are not. In today’s world, the information is there, yet most of us choose to ignore it. We do not let this uncomfortable information influence our consumerist decision-making in our supposed struggle to find ourselves and “not live someone else’s life”. The people who suffer due to the policies of Apple most notably in China are simply not part of the “we” that people are choosing to become, otherwise “we” would not allow it to happen. The environmental damage and exploitation would simply not be allowed if it was in “our” country or “our” community. Where Marx was right (Capital Volume I and III) is that commodity fetishism links the subjective aspects of economic value and objective reality. The value groups assign to material objects are transformed from arbitrary social impositions into very real social forces in the form of prices, which for Apple are sky-high. Marx argued that “primitive” societies fetishised unexplainable phenomena as magical and thus they became sacred or taboo. Under capitalism, people attribute special powers to objects and imbue them with symbolic meaning which then became part of an objective reality reflected in prices. What Marx did not predict was that people would attribute special powers to brands and individuals who are powerful agents in reproducing the exploitative and environmentally destructive social relations, which Apple users celebrated on the 6^th October 2011. Globally dispersed shrines to Steve Jobs do not merely fetishise products they fetishise a brand and a person as symbols of who we are and the world we want to live in. This is a world which celebrates gadgets and instantaneous yet transient pleasure to the detriment of the lives and life opportunities of the poor and globally marginalised.

It is appropriate in all discussions of identity to ask where we-ness comes from, who it includes, and who it excludes. Here, we turn to the ancient Tibetan philosopher, Nagarjuna:

“The essence of entities

Is not present in the conditions,

If there is no essence,

There can be no otherness-essence.”

There can be no Self without Other and there can be no Mac user without a PC user to define itself against. Our identities have no essence. They can only be defined by what they are not. We are who we become and how we define ourselves to the exclusion of others. We can choose to become globalised citizens who take responsibility for our actions or at the very least acknowledge their implications. We are choosing not to. There is little about the symbolism of Apple which is young, fresh, and innovative. Apple is reflective of far older forms of community boundary drawing which divide people into us and them through the manipulation of symbols which demand loyalty and convince people they are all individuals. Steve Jobs was a smart man. He once said "Remembering that I'll be dead soon is the most important tool I've ever encountered to help me make the big choices in life". If only those worshipping at his altar could heed this advice when they ask “who am I?” and “what type of world do I want to live in?”. When we face death Apple will provide no solace.