Seeing Shanghai | China’s GDP built on backs of low-wage workers

I don’t think anyone would be surprised to hear that China’s Gross Domestic Product is so high that it is ranked as second in the world behind the United States. A chart of China’s GDP over the past few decades looks like it is going up an extremely steep mountainside.

But this dramatic number doesn’t tell the whole story; it doesn’t tell of the hard work by so many people who brought it about.

This is an achievement that many people in China are proud of — and they should be. I cannot think of another nation that comes close to what China has done over the last few decades.

But there is another number. China’s GDP per capita (per person) shows a different picture. When its population is considered, China’s GDP ranks 90 something in the world, behind Thailand, Vietnam, and other nations we usually think of as less developed than China.

There is also a story that this number doesn’t tell, the story of millions living in extreme poverty.

In his book “China in 10 Words,” Hua Yu identifies one of his 10 words as Cha Ju, which means “disparity” in Chinese.

When Hua was growing up in China in the 1970’s, he didn’t see much real disparity. Everyone had to use rationing coupons to buy meat, oil, grains and other foods. Everyone had enough to survive, though he says it wasn’t quite enough for many adult men, so the women in their lives would eat a little less and share with them. No one got to eat their fill, and many of his pleasant memories of being a child involve a special meal or treat.

Hua writes that when he was growing up during the Cultural Revolution, the only real disparity he saw was an “ideological disparity,” meaning the gaps in the beliefs and actions between the regular people and the Communist heroes.

Communist ideals were pursued with such fervor that the saying “Better a socialist weed, than a capitalist seedling” was common.

But then things changed.

Today, everyone looks to a saying by reformist leader Deng Xiaoping that reads: “A cat that catches the mouse is a good cat, no matter whether it is black or white.”

And today there is real disparity in China. Hua writes that there are 800,000 people in China with disposable incomes over $1.5 million, and China is on track to surpass the United States as the top consumer nation of luxury brand goods (i.e. Gucci, Versace, Cartier, etc.) by 2015.

At the same time though, China has 100 million people making less than $150 a year.

Because most of my time in China has been spent in Shanghai, I haven’t seen the extreme poverty, which is mostly in the rural interior. I also haven’t seen much of the extreme wealth — I don’t have the income to move in those circles. I have seen more Gucci stores than I ever have before, and for the first time in my life, I have seen actual car dealerships for Rolls Royce and Lamborghini.

I have also seen people sweeping the sidewalks by hand with homemade brooms. Down the street is an elderly man who sits on the sidewalk on his stool, repairing cheap shoes and umbrellas. In the other direction is a woman who uses her gas griddle to make jianbing (kind of a breakfast burrito) on the sidewalk. She spends five minutes on each one and sells them for about 50 cents each.

Labor is so cheap that every aisle of the grocery store has someone waiting to help customers, the parking lots have someone just to push the button and hand you your ticket, and every fast-food restaurant has people waiting to bus your table. The trash pick up is done by migrants from rural China, pedaling tricycles piled high with scrap wood, plastic bottles and cardboard slowly through traffic.

I was pleased to read recently that Chinese Premier Xi Jinping said that GDP isn’t everything. But there is a lesson here for the United States, too. Unemployment remains high in the U.S., but just because the stock market has bounced back many think everything is fine.

In China, Children’s Day is a special day of focusing on children. Hua writes about how one recent Children’s Day he saw a television show asking children around the country what they most want.

One boy from Beijing asked for a real Boeing Jet, and then another boy from a small rural village asked for shoes.

Hua points out that both their dreams have about the same chances of coming true. And, we need to remember, both boys could have just as easily been born in the United States.