A Billion Eager New Capitalists in the Wild, Wild East

June 07, 1994|By RICHARD REEVES

BEIJING — Beijing. -- The newest capitalist country, which still calls itself by the communist name the People's Republic of China, may have the fastest-growing economy in the world, but it still doesn't get all the rules of the money game.

While President Clinton was still dithering over most-favored-nation trading status for China last month, the United States complained about a lack of protection for ''intellectual property rights'' -- counterfeit Mickey Mouse watches and all that. So, the deputy director of the State Commerce and Industry Administration, Li Bada, announced: ''Violators of trademark laws will face harsh penalties -- up to life imprisonment and the death penalty.''

Wow, the death penalty for ripping off Disney! That's what happens when a totalitarian police state meets free enterprise and goes crazy for it. There has been a wild revolution in China. Forgetting Clinton's confusion and ignorance, the horror of Tiananmen Square, and the painful personal stories of the dozen pro-democracy and religious activists most favored by the American press, these are the biggest stories, good and bad, in the Wild, Wild East:

* If you asked the Chinese, 1.2 billion of them, the Reagan Question -- ''Are you better off than you were four years ago?'' -- most everyone would answer ''Yes!'' And you'd get the same answer if you asked about 40 years ago or 400 years ago. China is freer and more prosperous than it has ever been. It is feeding its people better than it has for several hundred years -- and with better diets they actually look different, taller and more robust. It is at peace with its neighbors for the first time in at least that long.

* Both the cities and the countryside look terrific to a reporter seeing them for the third time over the past 15 years. The eastern corridor from Beijing south to Guangzho (Canton) has traditionally been the most prosperous part of the country, but that did not mean much when I first saw China.

Now the dusty or muddy and silent streets have become boulevards jammed with noisy and noxious traffic. Shacks have been buried under skyscrapers. People are cursing and smiling at each other. There is still great poverty, injustice and hurt in China, as there is everywhere, but hundreds of millions of ordinary people are laughing again.

* Chinese communism lives -- in name only. The center did not hold and power is passing to provinces, cities, villages and individuals. An example: When mandatory work-unit assignments, food-ration cards and domestic-travel permits were eliminated, the party block captains, who distributed or approved them, lost their power over neighbors and neighborhoods.

The death of the old economic order in the 1980s, which began with Deng Xiaoping allowing collective farmers to sell what they could grow on their own little plots, is sinking the political order -- despite the televised noise and blood of Tiananmen. If human-rights activists point to the persecution of hundreds of dissidents, the communists point to the improvement of life expectancy from 36 years to 65 and a three-quarters reduction of infant-mortality rates under their oppressive rule.

* Population control -- pressuring couples to marry and conceive later and limit themselves to one child -- is working, at least in the cities. But no one can be certain that will continue to happen in a more open society with more women of child-bearing age (340 million) than there are people in the United States. More children will almost certainly mean the return of famine and malnutrition in poor rural areas.

* The mix of communist structure and capitalist greed is producing truly spectacular corruption, a plague on this land. The looting is being led by provincial party powers and officers of the People's Liberation Army -- happily joined by local gangs and Hong Kong swindlers. While some Chinese in the southeast are secretly buying homes and businesses in Hong Kong (California will be next), peasants in the southwest have annual incomes of $40.

* The country has no functioning modern legal system -- even if it does decide to execute sellers of fake Gucci bags. There is no predictable system of dispute resolution for businesses or justice for dissidents. And there is no sure way to collect taxes, either. The glittering towers built by foreign investors dazzled by the size of the Chinese market remind me a little of Las Vegas -- big investment, but it's still a gamble.

* There is nothing for the Chinese to believe in anymore -- just more money. There was a spirituality in communist theory, shared goals and a utopian promise of equality. Now there is only the hope of getting rich -- and most people won't. When Chinese leaders say their greatest fear is ''instability,'' they are not talking about students who want American-style democracy; they mean rebellion by the losers in the capitalist boom: farmers, pensioners and workers laid off by privatized or collapsing old state industries.

* No one knows who's running China -- if anyone is. A national suspension of disbelief asserts that Mr. Deng is in charge. He may prove to be one of the century's great men for bringing his nation back into the world, but he is 89 years old and ill. What comes next could be the chaos and the nationalistic xenophobia and neo-feudalism that has crushed generations of Chinese.

I do not know how these stories will develop. But I was shocked to find some of them. The American preoccupation with personalities has distorted our understanding of what is happening to a billion less-articulate people in one of the amazing national transitions of this century and the next.

Richard Reeves is a syndicated columnist.

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