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In China, Making Money Can Mean Losing Friends

As China’s economy opens up, wealth is accumulating in the hands of a new generation of “very rich.” For the new owner class, money means more power and influence – but it can also breed resentment.

Article illustrative image Partner logo Wealth divide in the parking lot (Mark Heard)

BEIJING Chinese people may be fascinated by the very rich. But they don’t much like them. 

Chinese gripes with other people's wealth are popping up everywhere. In early May, information surfaced accusing the public company that runs the former Chinese imperial palace of quietly turning one of the Forbidden City’s apartments into a private club for billionaires. The news hit China’s Internet community like a bombshell, which reacted with outrage to the corruption scandal.  

Wealthy young drivers who consider themselves above the law are another favorite target. In 2010, the son of a local police chief in the city of Baoding struck and killed a female student on the Hebei University campus. What caused a scandal wasn’t the accident itself, but the young driver’s arrogant behavior. When the police tried to arrest him, the young man – expecting special treatment – cried: “My father is Li Gang!” For Chinese Internet users, the now-famous phrase became a symbol of impunity.

In 2011, the public was treated to another grizzly story involving a young man and an automobile. After hitting a young woman with his car, Yao Jiaxin, a student, finished the victim off by stabbing her several times. Observers were quick to describe this tragic incident as a sign that money-obsessed China is losing its moral bearings. Yao Jiaxin explained his actions by saying he thought the girl, were she to live, would try to extort money from him. Yao Jiaxin was sentenced to death and executed last June.    

In Chinese it’s called chou fu – hatred towards rich people. Signs of it are everywhere. According to some analysts, it is the result of a gradual, 30-year-long process of opening the economy and allowing wealth to accumulate in the hands of select individuals. In the past, Chinese inheritance laws prevented wealth from being passed along to the next generation. That has now changed.

Second-generation wealth

“When a reckless young man drives a BMW, he is considered a member of the ‘rich second generation,’ If he is caught, it increases tenfold the anger people feel,” says Yang Yiyin, from the Beijing Academy of Social Sciences (CASS). According to Yiyin, Chinese people do not object to wealth in and of itself. “They all want to be rich! Particularly when considering that most of the people who became rich these last 30 years were poor before,” he says.

Nowadays, however, people “are convinced that it has become far more difficult for them to rise socially than in the 1980s,” adds Yiyin. “When they think about the reasons why these people were able to become rich, they can’t help thinking that they must have done it illegally in some way. The Chinese consumer-citizen feels powerless.”

Guo Yuhua, a sociologist at the University of Tsinghua, in Beijing, puts it a slightly different way: “People don’t hate the rich. They hate the fact that power knows no control. Those who have power do what they want. They can exchange their favors for an apartment, a car, or even their professional status!”

Because of the recent speculation bubble, the race to buy real estate has split the population in two: owners and non-owners. The privatization of urban real estate over the past 20 years in China has helped the urban middle class gain wealth. But it did nothing for the rural lower-class, which still lives on collective lands.

 

For the growing number of wealthy Chinese, resentment from others, may help account for rising rates of emigration. A recent study by the management consulting firm Bain & Company found that 60% of “high return investment individuals” – people with at least $1.5 million to invest – have already moved abroad or consider doing so. And among the “super rich,” people with more than $15.4 million, roughly a quarter decided to change their nationality.

 

Still, links between the different social classes exist: in big cities, many former migrant workers are now entrepreneurs operating small businesses. According to researchers Gilles Guiheux and Pierre-Paul Zalio at the French Centre for Research on Contemporary China, young people come from out of town to work in the service sector as “white-collar migrants.” They work in less than ideal conditions, but sometimes the job pays well.

Is the Chinese dream turning sour? In Guo Yuhua’s opinion, today’s expressions such as “rich second generation,” “second generation executives” and “second generation migrants” all reflect “opportunities closing.” Power, he explains, is passed down from generation to generation. But so is poverty.

In addition, many Chinese who would be part of the middle class in other countries – civil servants, small business owners, teachers and executives – refuse to be considered as such in China. Why? Because, according to Guo Yuhua, they have no sense of professional or economic security. “Your flat can be demolished overnight. You can be evicted. There’s no guarantee of any stability,” he says.

To protect themselves, Chinese people want to become rich, very rich… even if it means that they will be despised.

Read the original article in French

Photo - Mark Heard

 

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About this article source Website: http://www.lemonde.fr/

This leading French daily newspaper Le Monde ("The World") was founded in December 1944 in the aftermath of World War II. Today, it is distributed in 120 countries. In late 2010, a trio formed by Pierre Berge, Xavier Niel and Matthieu Pigasse took a controlling 64.5% stake in the newspaper.

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