Out of Mao's Shadow: The Struggle for the Soul of a New China (22 page)

There were more protests in the weeks and months following the arrests in Liaoyang, many of them led by Yao’s daughter, who succeeded in keeping the case alive in the international news for a while. But the movement gradually petered out as police moved aggressively to divide and intimidate the remaining labor leaders. Many of the workers went into hiding, and some burned their copies of Pang’s letters, worried that they might be used as evidence against them. Eventually, police made a list of worker leaders, and visited them one by one. In each meeting, they made a similar offer: spy on your comrades for us, and your financial problems will go away. The workers I met all told me they refused, but the damage was done. The police had sowed mistrust and mutual suspicion. “For a while, we were united, but there’s no worker solidarity now,” one of the protest leaders told me. “We don’t trust each other. And we probably shouldn’t.”

As police targeted the worker leaders, the government also tried to assuage the deeper anger that drove the protests. Over the course of a year, it arranged to pay the Liaotie workers much but not all of what they were owed. The party also decided to sacrifice and make an example of Fan Yicheng and seven other factory officials. State media reported that investigators discovered a hundred million yuan unaccounted for at Liaotie, or about $12.5 million, less than half of what the workers alleged had actually disappeared. Fan was convicted of smuggling and fraudulent dereliction of duty and sentenced to thirteen years in prison; three other managers also received jail time. The provincial governor who approved the Liaotie bankruptcy was later implicated in a bribery case and imprisoned. But Gong Shangwu, the party official who was accused of collusion with Fan and bragged about the absence of unemployment in Liaoyang, escaped punishment.

Prosecutors tried Yao and Xiao on charges of subversion in the winter of 2003, after a long delay in which officials made contradictory claims about what crimes the men had committed. In the end, the government settled on an allegation that Yao had joined the China Democracy Party after all, and that Xiao was one of his accomplices. Over the objections of international labor and human rights groups, Yao was sentenced to seven years in prison and Xiao to four years. For a while, the two men spent time in the same prison as Fan Yicheng. Pang was released before trial and died of cancer a few years later.

The party never again faced a threat from laid-off state workers as serious as the Liaoyang labor movement. In the following years, the government finished privatizing the bulk of state industry, shrinking the number of workers in the sector to what it considered a sustainable level. At the same time, it succeeded in riding out a wave of mass layoffs and preventing a national labor movement from emerging despite widespread worker frustration. In effect, the party navigated one of the most difficult political challenges in the transition to a market economy, one that has often tripped up other socialist governments. Key to its success was its tight control of the media, which prevented news of labor protests from spreading from city to city. But also critical was its deft touch at containing unrest, its readiness to take a hard line or offer concessions depending on the circumstances. Party leaders looked the other way and let managers and local officials plunder state industries, providing the incentive that kept privatization from stalling in the bureaucracy. They kept workers divided and distracted by carefully distributing minimal welfare payments. When protests presented a threat, the party moved quickly to intimidate workers by arresting their most outspoken representatives. And if that wasn’t enough, it sought to calm the public by arresting a few of its own.

In the years after the Liaoyang demonstrations, the party leadership boosted investment in the rust-belt provinces and set aside more money for welfare payments to laid-off workers across the country. Some workers have managed to adapt to the market economy and prosper. But many, especially in the older generation, continue to live in poverty and remain bitter about how the state has treated them. In Liaoyang, unemployment seems to have fallen somewhat, but the divide between rich and poor is even more obvious, and residents continue to complain about work conditions and corruption. The daughter-in-law of a senior city official is said to have made a fortune with real estate from the Liaotie bankruptcy. And painted on the side of one of the Liaotie factories that has resumed production is a new slogan: “Work hard today, or you’ll be working hard looking for a job tomorrow.”

When I last saw Xiao, he told me he never regretted turning down the government’s final offer to him. “How could I have faced the workers and my neighbors if I had taken the vacation?” he said. “Anyway, I didn’t do this for personal gain. I always knew there were risks.” Four years of prison had been hard on him and his family, but he remained unbowed. He said he was still pushing for Yao’s release and willing to fight for workers’ rights. At the same time, though, he seemed torn about what his sacrifice had achieved. “Some people say we failed because we were imprisoned,” he said, “but I think we succeeded.” He mentioned the payments to the workers at Liaotie, and the increased welfare benefits for laid-off workers nationally. “This is the result of our struggle,” he said.

But as we continued to talk, Xiao belittled the payments, saying they helped the government put off demands for more fundamental change, such as the right of workers to organize. “It’s nothing but a way to shut workers up,” he said. “The workers didn’t see their long-term interests. They were paid once, and that was it.”

So the party won? I asked. “The party was very successful,” he replied.

W
hen the bulldozer pulled up to his house—the house he built brick by brick with his sons, on land his father bought with thirty-six bolts of cloth from a middleman in an old Beijing teahouse—Liu Shiru was standing a good distance away, hiding behind the throng that had gathered to watch the demolition, and trying to avoid being spotted by his brother. It was a cold morning in the winter of 2000, and Liu shivered in a thick cotton coat as he studied the crowd. There were a few city officials, some men from the real estate company, a group of construction workers, and a handful of police officers. Several of his neighbors had bundled up in warm clothes and were also standing outside, but most residents had already packed up and moved out of the neighborhood. Liu’s house was one of the last on the street, and by day’s end, he knew, it would be gone, too.

Liu was a large, pear-shaped man, not yet fifty years old but almost bald, with only a thin, buzz-cut crop of graying hair. He worked as a salesman at a struggling electrical equipment factory, and he knew he would never be able to afford another home like the one he was about to lose. From the street, it looked like a small, simple structure, with no more than a room or two on each of two floors. But tucked behind the building was a traditional courtyard, with an apple tree and a grapevine trellis and extra rooms on the other side. The location of the house was what made it especially valuable. It sat in the heart of central Beijing, not far from the glitzy Wangfujing shopping district, on a quiet lane steeped in history. The street was a narrow alleyway known as a
hutong,
a Mongolian word imported into Chinese when Kublai Khan rebuilt the city and made it his capital. Liu’s particular
hutong
was named Suianbo, after a Ming Dynasty nobleman who lived there in the fourteenth century. More recent, distinguished party and military officials occupied some of the houses on Suianbo Hutong. One of them, Deng Tuo, a prominent writer and a former editor of the
People’s Daily,
committed suicide in his courtyard at the start of the Cultural Revolution.

Chen Lihua

Liu’s father purchased the original house at No. 10 Suianbo Hutong a year before the Communists came to power. He was an illiterate repairman at a local hospital who had managed to build a business making medical instruments, and the house was the result of years of sweat and savings. The family moved in soon after Liu, the youngest of five sons, was born. The early years there were difficult. Despite his humble background, Liu’s father was persecuted as a capitalist and forced to turn over his business to the state. But Liu clung to more pleasant memories of growing up in the
hutong
—the meals his mother prepared on the festival days, the bag of sand he tied to the branch of a mulberry tree in the courtyard to play at boxing, the warmth of family life before his family fell apart. Liu’s brothers got married in the house and moved into different rooms around the courtyard to raise their own children, the oldest of them not much younger than Liu himself. A lifetime later, after his brothers stopped speaking to him, Liu would smile as he recalled how he and his nephews and nieces used to chase one another around, clambering up trees and onto the tiled roofs of the buildings, filling the courtyard with laughter.

The idyll of Liu’s childhood ended when the Cultural Revolution began. In the summer of 1966, the party labeled homeowners members of the capitalist class and ordered them to turn in their property deeds to the government. Liu’s parents were frightened, and his brothers were busy at their work units, so at age seventeen, Liu submitted the certificates himself. The family began paying the government rent, and the government assigned two other families to live in the house with them. Two of Liu’s brothers were forced to move out, and after graduating from high school, Liu was sent away, too. Like many his age, he was sent to the countryside, where he spent the next eight years doing farmwork. As the Cultural Revolution ended, he was assigned a job at a state coal mine. It was not until late 1989, more than two decades after he left, that Liu was allowed to move back to Beijing. By then, everything had changed. His father had passed away, and his mother had had a falling-out with his brothers. The government returned the deed to No. 10 Suianbo Hutong to the family, but there were squabbles over the property. Liu took his mother’s side in the family disputes, and before she passed away a few months later, she bequeathed the house to him. Though relations were strained, one of Liu’s brothers continued living in rooms on the courtyard’s south side, while Liu took over the rooms on the north side with his wife and three sons.

A few years later, Liu and his sons rebuilt the north building, adding a second floor. The original building had been falling apart, but there was another reason for the renovation. Liu was thinking of his two eldest sons, then in high school, and their marriage prospects. Many parents wouldn’t let their daughters marry anyone without an apartment. But there was a severe shortage of housing in Beijing, and an affordable place to live, especially near the center of the city, was almost impossible to find. Liu wanted to make sure there was enough room for his sons to stay in the family courtyard after they married. They could raise his grandchildren there, he thought, and maybe the laughter would return to No. 10 Suianbo Hutong.

Liu knew there could be a hitch in his plans. Beijing was changing quickly, and old
hutong
neighborhoods across the city were being demolished to make way for modern office towers, high-end shopping malls, and luxury apartment buildings. Such redevelopment lifted the value of prime downtown real estate. But for homeowners like Liu, that could be a curse as much as a blessing. Rising property prices attracted developers, and they could pay good money for valuable land. Much more often, though, they found a way to take it on the cheap. A year after Liu finished renovating his home, the
hutong
where his sister-in-law lived was slated for demolition to make way for a new complex of office buildings called Financial Street. She and other residents who owned houses in the construction zone never received an offer to buy their properties. Instead they were just evicted and assigned to new apartments on the outskirts of the city worth a fraction of their original homes. Altogether, some four thousand houses were destroyed and more than twelve thousand people were relocated. Liu followed the situation closely, and he worried the same thing might happen to his neighborhood.

Those fears intensified in the fall of 2000 as rumors spread that a massive redevelopment project had been proposed for Suianbo and other nearby
hutong
s. Then, on a cool evening in late October as Liu was watching television, he heard a commotion in the alleyway and stepped out in his nightshirt to see what was going on. His neighbors filled the street, crowding around notices printed on white paper that had been pasted on the walls. Liu made his way to the front of a group gathered around one of the notices. “A Letter to Residents to be Relocated after Demolition,” it said at the top, and below was a long body of text that began:

Liu was confused at first, because there was no street named Jinbao Avenue in their neighborhood. But as he continued reading, he realized the city had approved a plan to carve a new boulevard through the community, extending about a half mile from the Wangfujing shopping area to the city’s central business district. The letter listed more than two hundred residences—including every house on Suianbo Hutong—that would be demolished to make way for the road and for unspecified new projects alongside it. Demolition work was scheduled to begin the next day and to be completed within a month.

Liu and his neighbors stood on the street, dumbfounded and angry. Some had lived on the
hutong
all their lives, and now they were being given just a few weeks to move out. The letter said residents could collect the equivalent of about eight hundred dollars in compensation for each square meter of their homes, plus a five-hundred-dollar bonus if they moved out quickly. But there was no distinction drawn between tenants of state-owned housing on the street and residents like Liu who owned their homes. There was no attempt to assess the market value of their property, and no offer to negotiate terms for a sale. Residents stood on the alleyway fuming and cursing until well past 2
A.M.
that night. Some tore down the notices in anger. Others vowed to fight the project.

After what happened to his sister-in-law, Liu was determined to protect his property. He owned the house, and if developers wanted to tear it down, they would have to pay a fair price for it. As far as he was concerned, the compensation offer outlined in the letter was nowhere near a fair price. He knew that apartments in downtown Beijing were selling for more than $2,500 per square meter, while the going rate for office space was even higher. His house occupied seventy square meters of land, and if developers built a high-rise over it, the size of the fortune they could make would be multiplied by the number of floors they were given permission to build. So Liu ignored the letter, stayed put, and waited. After a few weeks, when men from the real estate development company finally called on him, Liu told them he objected to the notices they had posted. They asked what he wanted, and Liu told them he wanted them to acknowledge that he owned the house. He refused even to discuss a price until they recognized that simple fact, but they demurred. The conversation lasted only a few minutes.

A few weeks later, the men returned with an offer. They said the developer was willing to treat Liu’s family as a hardship case and give him extra money for relocating—about sixty thousand yuan for each member of the household, for a total of three hundred thousand yuan, or about $37,500. But the men wouldn’t acknowledge that Liu owned the house, and Liu rejected the offer immediately. It was a large sum of cash, but barely enough to buy an apartment on the outskirts of the city, and nowhere near the market value of his land. In any case, Liu told the men, it wasn’t about the money. It was about respecting his rights, about proper procedures. He wanted them to understand that he was not going to roll over. It was his house, and if they wanted it, he said, they should hire someone to conduct an independent appraisal and pay him what it was worth. The conversation was again a brief one.

As the weeks passed, Liu turned out to be the most stubborn of the residents on Suianbo Hutong. His brother wanted him to sell, but Liu refused. At the same time, one after another, his neighbors struck deals with the developer, collected compensation, and moved out. They saw it was the smart thing to do, given that the government had already endorsed the developer’s plan and labeled it “an important municipal project.” It didn’t matter if people owned their houses, or how long they had lived on the street. If the developer had the government’s support, it was going to get its way. You could grumble, and you could curse, but in the end, you would have to move. One by one, Liu’s neighbors concluded that all they could really do was try to maximize what they got in return. Liu, however, took another approach. He kept insisting that the developer admit he owned the house, a concession that would improve his negotiating leverage and the strength of any lawsuit he might file—and that the developer was unlikely to make. It seemed foolish and reckless, and when I asked him later why he had been so persistent, Liu couldn’t really explain what motivated him. “I didn’t care about the money,” he told me. “It was just a matter of principle.”

By early December, the developer had reached agreements with everyone on the street except Liu, and the company applied to the government for permission to forcibly evict him. The government agreed, and a few days before the eviction was to occur, Liu was summoned to a meeting at a temporary office that the developer had set up in one of the courtyard houses in the neighborhood. Two officials from the Dongcheng District’s housing bureau sat on the edge of a table, and motioned for Liu to take a seat in front of them. There was no small talk. The men told Liu he had to move. The Jinbao Avenue project had the support of the state, they said, and if he tried to fight it, he would lose. He should turn over his deed, they said, and accept the developer’s compensation offer of three hundred thousand yuan. Otherwise, they said, his house would be demolished and he would get nothing. Liu tried to argue with them, but got nowhere. The officials warned Liu that this was his last chance. Liu refused to give in and skulked out.

As he left the office, Liu saw his brother go in. His brother wanted to accept the compensation money and move out, but the developer had refused to pay him. The brother was a tenant on the street like any other, but the developer said he wouldn’t get paid until Liu turned over the deed to the property. It was an attempt to split the family, a common tactic used by developers against those holding out, and it worked. That night, as Liu was taking a walk on the
hutong,
his brother and several other men jumped him. Liu cried for help and a police officer appeared, but instead of breaking up the fight, the officer held him in place as the others beat him. Liu lost a tooth in the fight before breaking free and running away. After the assault, Liu stayed away from his house, living with his mother-in-law instead. His two older sons remained at home, though, and they told him when his brother hired a crew of workers and tore down the rooms on the south side of the courtyard. They also told him that his brother was still looking for him, that he had hired thugs and was threatening to pummel him again and force him to turn over the deed. Liu’s relationship with his brother had been strained for years, but he never imagined it would come to this.

As he stood in the street on the morning of the demolition, Liu scanned the crowd warily. His brother knew him well enough to know that he would return to watch the demolition, that he needed to see the fight to the end. Liu was sure his brother was somewhere nearby, and he didn’t want trouble. Standing at the front of the crowd were his wife, his sons, and his sister-in-law. One of the city officials went up to them, said something, and then shook hands with his wife. Liu realized that the man had just formally ordered them out of the house, and that it all would soon be over.

A crew of workers filed past his family into his home and began loading their belongings onto trucks that were parked outside. A few men were videotaping the proceedings, and the police officers escorted his family away from the house. After the furniture was removed, someone climbed into the bulldozer and started the engine. With a quiet rumble, it moved forward and knocked down one wall, then another, and soon all that was left was a pile of rubble. It happened much faster than Liu expected. As the crowd began to disperse, he stood staring at the cloud of dust that was once his family’s house. He felt furious, depressed, helpless, and then numb.

Liu knew the name of the real estate company that was building the Jinbao Avenue project. But it was not until later—after he was relocated into a slum on the outskirts of the city, after plans were announced to build a luxury hotel on the site of his home, after he filed the lawsuits that went nowhere—that he learned who ran the company. Her name was Chen Lihua, and she was the richest woman in China.