June 3, 2013
By: Steve Hilgart, Director of Marketing & Conference Operations
One month in the far east, and GWP’s Steven Hilgart is bidding China farewell, leaving us with a few nuggets and observations he made along the way.
I have to warn you, the third part in this trilogy is a long one… but I promise it won’t be as bad as The Matrix: Revolutions. There’s a lot of good stuff in here, if I do say so myself. So grab a glass of wine, maybe a bowl of popcorn, and enjoy the magic that is…
The time is drawing near to move on to my next adventure. On Monday I leave for the beautiful city of Riga, Latvia.
I’m a little sad to go, but this is a place I will definitely be visiting again. I’ve learned so much about this country and its culture – and as an added bonus I’ve managed to steer clear of any of the 55 crimes that are rectified with capital punishment (score!).
I could write novels about my experiences so far this month – and I feel even if I spent a lifetime here, I wouldn’t learn everything there is about the people and the culture.
But before I get too far, I need to mention a (somewhat) small mistake… it’s only a mistake to the tune of…
Remember when I said that there will be around 3 million more men than women in this country? What I meant to poorly translate from Chinese to English is 30 million more men than women (still a little unclear on how I misinterpreted that).
If you thought 3 million angry young men without girlfriends or internet pornography was a recipe for disaster, try 30 million – even angrier – young men without girlfriends or internet pornography.
The government tries so hard to maintain control here… and with a population of 1.4 billion – how much longer can they hold on?
The other day I heard an English teacher talking about a conversation with one of his students…
“Teacher, why can’t we have Facebook?”
With their job on the line (and a possible hard labor sentence), the only response they could muster was, “Well, uh, because it’s not allowed.”
“We need to move on to the next subject…”
(Now that there, Ming-Ming, is dangerous thinking.)
Apparently this teacher wasn’t alone as half a dozen other foreign teachers at the table mentioned they had a similar experience.
Everyone here just obeys. They don’t question, they don’t rebel – they do what they’re told. But it’s amazing questions like this that change the future of a country, a people, and a world.
To make sure young Ming-Ming doesn’t create a dangerous Facebook account, there’s an army of 500,000 people who directly and indirectly work to censor the internet.
Chinese versions of social networking sites are heavily monitored and anything that is deemed inappropriate, controversial, or against the ruling party can be taken down as quickly as it was put up.
To access the internet at one of the several “internet cafes” around, you must register with your identification. What if a foreigner wants to check their email? They’ll gladly photocopy your passport for you and figure out where you’re staying to track you down if need be (or want – you choose).
Meanwhile, back in the States, President Obama said last week he wants to “review the authorities of law enforcement, so we can intercept new types of communication, and build in privacy protections to prevent abuse.”
Will it become commonplace for people to register to use a censored internet? To the governments of the world I say to you: good luck.
The youth are catching on. More and more Chinese people are accessing the internet through VPN services like Cryptohippie. They can surf the web anonymously and create as many blogs, Twitter, and Facebook accounts as they want.
And once they do, maybe they can tell the world about some of the goofy things I find around here like…
Remember a few years back when the banks couldn’t lend enough money out to people (who couldn’t pay it back)?
Commercial construction companies built strip malls like they were going out of style. And when they couldn’t fill them, the builders blamed the developers, and the developers blamed the banks, and the banks blamed the economy – and not only did no one get paid, these commercial properties sat empty.
Let’s pretend for a second the government said “here’s more money than you’ll ever see in your lifetime – get to building.”
Well, that’s what happened (and still is happening) here. With a billion people around, housing is always in demand. So what would you do with all that government money? That’s right – build housing.
Apartments are the flavor here – massive ones (you know, for such little people they sure do build lots of huge things).
So scattered around this tiny town of 7 million people – and many, many, other places around the country – are dozens and dozens of skyscraper-like apartment buildings that are completely empty.
Back in the states there has been a lot of controversy about these “Ghost Towns.” Some say it’s an exploded real estate bubble, some say it’s the urbanization of China, but I know why they’re empty right now – they are too…
With all of the government money given to these developers over and over they continue to build housing far out of the price range of the average family.
While I have yet to find a country that is overabundant in common sense – this one may take the cake.
Here’s the formula: they build high-end apartment buildings (a lot of them) that people can’t afford, then, they build more!
And the media wonders why they sit empty… you’re a smart person – you could have figured that out. But maybe they’ll prove both of us wrong and reveal this government’s…
Given what we see of most governments, it’s far-fetched – I know. But hear me out…
Recently, Los Angeles had a bit of a pollution problem. Smog is not an uncommon thing in that city but during this particular instance the Air Quality Index (AQI) was over 100 – which meant it was “unhealthy for sensitive groups of people.” Immediately they shut down schools, stayed indoors, and bought gas masks by the truckloads.
Jinan had a similar problem this past winter. Except for the AQI wasn’t just over 100… it was over 800.
When the smog is so bad you can’t see the stop light across the intersection – it becomes something of a problem (especially how they drive around here!).
This was one of the first times there was reason for a “legitimate” complaint from the people. But since no one had really ever had a “legitimate” complaint before (at least one that didn’t deserve capital punishment) – how do you handle it?
As a good concerned citizen, who do you call? Who do you talk to? What do you do? There really wasn’t a procedure for such a thing… no governors to write letters to or call and no mayors to harass in email…
But something had to be done, so the concerned citizens meekly told the officials they knew that they would like something done about the pollution (you know, if they had some extra time).
For the first time in recent Chinese history, they didn’t need to crush some new revolution, or behead a disobedient rebel – they just needed to regulate how many cars were on the road and which factories could spew out poisonous fumes for that day – which they did.
And the people rejoiced… or forgot about it – one of the two.
Maybe it was the taste of a small victory. Maybe people were sick of secretly drowning their daughters in the river until they had a son they wanted in the first place. Regardless, people then started asking the government to get rid of the…
This policy has very interesting affects on the psychology of this culture. But it seems people are ready to retire this ideal.
Maybe they’re sick of resorting to In Vitro Fertilization to artificially create twins (which count as one child… as long as you pay off the doctor to keep their mouth shut).
But it sounds like the government is ramping up to move to a two-child policy. Can you even imagine what would happen when 1.4 billion people are suddenly told “go have another kid”?
It would make the American Baby Boom look like a panda mating ritual…
Although it still doesn’t solve the affordability aspect of these ghost town apartments, there sure will be an exponential growth in population – enough to fill up those apartments.
If anyone is looking for opportunity to get extremely rich – follow the needs of the new Chinese baby boom that’s coming.
But all of the stuff I’ve written so far was just an appetizer compared to what I’ve learned about Chinese…
Business & Taxes
Tax evasion was crossed off the list of crimes punishable by execution in 2011 – not that that stopped anyone before.
This month, I’ve been to dozens of restaurants, clothing stores, electronics stores, souvenir shops, and night markets. The one thing I noticed is that every single transaction is cash. From the lowest of street vendors to the fanciest of 5-star restaurants (which maybe only really deserve 3 stars).
It is extremely rare to use a credit card for anything (if they even allow it, which 99% of the businesses don’t).
And as any somewhat-sane rational human being would do when taking cash, they casually “forget” to include taxes (go free market – woo!).
Just as I was getting used to this not-paying-tax thing, something interesting started happening.
Everywhere we went, if one of the English teachers were with us they would ask for the “fapiaō” – which I thought just meant “receipt”.
They asked for the “fapiaō” for everything. Restaurant meals, clothing shops, even taxis – and I just thought they were keeping good records – until one night I picked up the tab at a restaurant for the group – and they still spoke up;
“Laō Shì, fapiaō” (Waiter, receipt please)
Instantly I said “Oh, I don’t need a receipt.”
“We have to turn these in,” was the response.
Utterly confused at what that could possibly mean, I started asking questions:
“Who would possibly want my receipt?”
Turns out “fapiaō” doesn’t just mean “receipt” it means…
Let me ask you a question. In a country with a huge population who’d rather take the death penalty than pay taxes – how do you coerce people into paying their “fair share”?
If the stick really doesn’t work, maybe the carrot will – how about we… reward them?
The government decided to institute a system where its citizens would rat each other out for the chance to win cash.
Every established business now has a ‘lottery receipt printer’ which works something like a scratch-off ticket back in the states. Not only does it record the transaction, it sends the information directly to the government and ensures that business will pay taxes on that purchase.
If a loyal and patriotic citizen asks for his or her “fapiao” they have a shot at winning anywhere from 5 to 50,000 RMB (which translates to approximately 1-8,300 U.S. dollars).
With all of this going on you may ask me…
“Does It Work?”
In fact, it does… to an extent. It even allowed the Chinese to surpass the U.S. in sales tax collections (in comparison to GDP).
While the real numbers elude me, I was able to find that in 2002 the prize money for these tickets was 30 million, while the tax revenue brought in by the lottery receipts was 900 million (I bet the IRS doesn’t get that kind of return). And tax revenues seemed to have steadily increased every year since.
But all is not lost. Even with this reward system put into place, there isn’t a lot of loyalty to the government. The majority of people just tend to ignore them. Even with the promise of prize money, the majority of transactions are still unrecorded cash.
Prices are extremely negotiable for everything as long as you aren’t one of the tattle-tales. Like true capitalists, they pass the savings on to the customer.
Maybe I’m a little skewed in my perspective but I’m not a big fan of taxes – and it seems the Chinese people agree with me.
I certainly can’t speak for everyone but it brings me a lot of joy to see the people prospering even under a totalitarian government. It makes me hopeful for what will happen to the people of the United States.
So – a different country, a different culture, and some very interesting ways of managing it all – that’s what I’ve found here in China. If amazing food, people, and an overabundance of opportunity is your thing – make your way on over.
Next time you hear from me it’ll be from Latvia’s capital city where I intend to find great history, fine wine, and beautiful women.
Until next time,
Have a fantastic day and live well!