HUAXI, China – Ask not why the citizens of this village of 2,000, a few hours by car northwest of Shanghai, have built a 74-story skyscraper next to their prim town square. Everybody in China knows the answer: It is another step in their plan to create the communist utopia envisioned by Mao.
The utopia part certainly seems plausible. Whether Mao would have approved is a bit more in doubt.
Huaxi’s so-called New Village in the Sky – at 328 metres, a bit taller than the Chrysler Building in New York – is getting finishing touches this summer in preparation for an October opening. Among other attractions, it will boast a five-star hotel, a gold-leaf embellished concert hall, an upscale shopping mall and what is billed as Asia’s largest revolving restaurant. Also, it will have five life-size statues of a water buffalo, Huaxi’s symbol, on every 12th floor or so.
That this half-billion-dollar edifice is a good 40-minute drive from a city of any size is part of the plan. Though not many foreigners have heard of Huaxi, Chinese far and wide know it as the socialist collective that works – the village where public ownership of the means of production has not just made everyone equal, but rich, too.
Two million tourists come annually to view the Huaxi marvel, no small number of them officials from other villages who yearn to know how Huaxi did it. The enormous skyscraper, topped with a gigantic gold sphere, will never win architectural awards. But it will add to Huaxi’s allure, the village fathers confidently predict – and soak up tourist money as well.
“We call it the three-increase building,” said Wu Renbao, 84, the town’s revered patriarch, meaning that it will increase Huaxi’s acreage (by half), increase its workforce (by 3,000) and, hardly least of all, increase its wealth.
If he is right, all 2,000 villagers will get a little richer. They all own a piece of the building – just as they own the town’s steel mill, textile factory, greenhouse complex, ocean shipping company and other ventures. That is Huaxi’s carefully curated narrative: By rigidly adhering to socialism with Chinese characteristics, the citizens of this little village have created an oasis of prosperity and comfort that is the envy of the world.
When China effectively embraced capitalism in the 1980s, Huaxi was an agrarian hovel, reachable by dirt roads. Wu, then the local Communist Party secretary, seized on the new market freedoms to shift the Huaxi economy from farming to manufacturing and trade, but with a twist: the residents would throw their money into a collective pot and share in the take from whatever new businesses they bought.
“In the 30 years after the opening up, the system changed in many places,” Wu’s son, Wu Xie’en, said in a recent interview. “Some chose private ownership, but we Huaxi people chose public ownership. The biggest benefit is that the people share the common prosperity.”
That Huaxi is prosperous seems undeniable. Here, the villagers get lavish annual stipends, live in spacious single-family homes instead of China’s usual cramped apartments, drive imported cars, and get basic medical care, education and even an annual vacation free from the government. Lately they also get free helicopter rides, courtesy of a 100 million renminbi, or $15.5 million, fleet of helicopters and small jets the village is buying to attract still more sightseers.
Ge Xiufang, now 62, was a penniless peasant in a northern area of Jiangsu province when her newly graduated son began looking for work in the early 1990s. “He saw an ad in the paper calling for workers to come to Huaxi,” she said. “So we came here, and two years later, we became villagers.”
That was in 1993, before Huaxi took off. Ge was interviewed in her son’s house, a two-story building with marble floors, overstuffed leather sofas, a large aquarium and a liquor cabinet dominated by an enormous bottle of expensive scotch. Ge said she and her husband live in a sprawling town house a few blocks away and shuttle between homes in one of the family’s three cars.
“We peasants, we didn’t even have apartment buildings in those days,” she said. “We had no idea it would be this good.”
The elder Wu extols Huaxi’s splendour – and the Beijing government’s wisdom and foresight – in a lengthy lecture given each morning in an auditorium packed with hundreds of tourists. To hammer the message home, there follows a musical, a sort of Chinese opera with Disney characteristics that sports toe-tapping lyrics:
Where we live: garden, house, little Western-style mansion
What we eat: a food culture full of nutrition
What we wear: big brand names of fashion
Huaxi is rich in substance, politics and spirit
One American guest said, “OK, OK,
Socialism is so good, we Americans want it, too!’’
Yet what is branded as socialism looks from the outside a great deal like an old-fashioned capitalist corporation, apparently savvily managed, with 2,000 shareholders who live comfortably off their dividends. Indeed, Huaxi’s affairs are run by a company, Jiangsu Huaxi Group Corp., reported to shelter 57 subsidiaries, including seven more holding companies. The town has interests in everything from extruded aluminium to traditional medicine to spun polyester cloth to real estate.
“We have too many investments to count,” said the younger Wu, the chief executive of the enterprise, which is said on several web-sites to be managed by members of the Wu family. He said he spends his days worrying about investment bubbles, and sprinkles his conversation with references to business advice gleaned at the University of California, Berkeley, and from studies of General Electric’s business model.
Those claims of success are hard to verify, because the conglomerate’s revenue and earnings are not disclosed in an audited form. Published but unverified reports indicate that the corporation employs at least 25,000 people, many of whom live in the urban area of about 30,000 that exists outside Huaxi’s cramped legal boundaries. A 2009 report in a state-run newspaper said annual revenue totaled 50 billion renminbi, about $7.7 billion at current exchange rates.
Village leaders have denied persistent reports that Huaxi benefits from substantial government subsidies like low-interest loans, although the younger Wu said in an interview that some of the village’s ventures are financed by debt that amounts to as much as 60 percent of their value.
While each villager is required to work at a Huaxi business seven days a week, virtually all the manual labour is performed by what Marx might have called the proletariat: thousands of outside workers, many of them migrants, who receive better salaries and benefits than many workers elsewhere, but do not share in Huaxi’s profits. For that, one needs a hukou, or residence permit – and Huaxi hands those out with great care.
“This is called exploitation,” said Fei-Ling Wang, a Georgia Tech professor who has studied Huaxi as part of research into Jiangsu province villages. “Because the outside workers, by law, cannot become a local resident. They cannot share the results of their works. And they are paid by wages, and if they lost their job, they are simply sent home.”
“If all migrant workers are treated as full members of the community,” Wang said, “then Huaxi wouldn’t work.”
The two Wus allow that the village has yet been unable to shed capitalism, but they insist that Huaxi has moved to a higher level of socialism than China at large, and that utopia is a matter of time. “Huaxi’s development depends on capitalism and business,” the elder Wu said. But “capitalism is only a temporary stage. Eventually, we will build Chinese socialism with Chinese characteristics.”
To Huaxi’s 2,000 shareholders, it may be a distinction without a difference as long as the profits keep rolling in. Wu says they will: in three decades, he insists, not one business venture has gone sour. To Huaxi’s cautious villagers, he said, investing is “like stepping on sea ice.”
Will a 74-storey building in the middle of nowhere crack the ice? Not likely, the Wus say: Just in the last year, one of the building’s water buffalos has grown in value by 70 million renminbi, or about $10.7 million.
That would be the buffalo destined for floor 74. The one cast in solid gold.