Issue 477, July 26
Translated by Tang Xiangyang
Original article:[Chinese]

"Middle class" is a seductive phrase. For individuals, being "middle class" means they are living well off, have peace of mind and are among society's mainstream class. When the middle class accounts for over 60 percent of the total population in a society, it will be considered to be a harmonious "olive-shaped" society and will enter the state of being a comparatively mature modern country.

Without a doubt, our society is approaching the target of becoming an "olive-shaped" society. Recently we have had good and bad news. The good news is, according to the Development of Beijing’s Society Analytical Report of 2010 released by the Chinese Academy of Social Sciences, the middle class, with a population of 5.4 million, amounts to over 40 percent of the total registered Beijing population, far exceeding the national average level of 23 percent. Based on this ratio, Beijing has already become a "quasi-middle-class-society". But the bad news is, among the 5.4 million people, 68.5 percent are slaves to mortgages or car payments.

Many analysts are worried that the data suggests that Chinese society is flowing downstream, a sociological term which was created by Miura Show that refers to the lower middle class who, though possess adequate material possessions, have huge pressures and face fierce competition, and thus lose the drive to develop. They then accept mediocrity and begin to drag down society as a whole.

The worry over the down-stream trend of the middle class has been a topic of worldwide concern. The most typical example is the “IPOD generation" in Britain. Of course, this does not refer to the Apple MP3 player, but is the abbreviation for “insecure, pressured, over-taxed and debt-ridden". Nike Bosanguet, one of the co-authors of "IPOD", said, "We are used to assuming that the new generation will be stronger than the old one. But, nowadays youngsters are set to bear new responsibilities and the difficulties for them to increase their incomes and create wealth are even greater than before. This is indeed a severe problem this country is facing."

We are experiencing the same problem as the "IPOD generation". And our problem is even more severe: We are not flowing downstream, but are stagnant at a lower starting point; we have always been a part of the downstream society rather than flowing towards it.

This is not an alarmist statement. International experience has told us, rather than defining middle class as a single income index, there are standards to help evaluate whether one is middle class or not. The first standard is having access to stable income sources in order to ensure a relatively decent life; the second is having stable safeguards; the third is having peace of mind, a conservative mentality, while surrendering to the mainstream moral, ethics, social and cultural order and having a public spirit.

The salary increases of our working classes, who are the mainstay of China's middle class, has never proportionally matched our GDP growth. Statistics show that the ratio of salary to GDP in China has decreased by almost 20 percentage points in the past 22 years while the growth rate of government revenue has exceeded that of citizens' revenue; indicating that the benefits brought about by economic growth have flowed to enterprises and the government rather than individuals.

Is our middle class secure? That is precisely what worries us. The income of most urban families is spent on housing, education and health care. We are worried because we cannot afford education or a house, and we dare not to become sick. Even with a house and a car, we are trapped in poverty as we have to pay the mortgage every month and live within our means.

Do we have peace of mind? When our society gives high returns to speculators and conmen, when there is a lack of justice and fairness and the entire society is filled with mistrust, peace of mind is naturally out of the question and the saying "cultivation of public spirit" are just empty words. A common view is that the middle class is society's "shock absorber". If the middle class becomes too small or too large, society will become M-shaped, with the numbers of the rich and the poor far exceeding that of the middle class which will be squeezed out by the former two and suddenly disappear, shaking up society. The way to avoid such risk is for our government to accelerate the reform of income distribution and return wealth to the people; improve the social security system and make it work more effectively and include more people and continue to nurture the spirit of public participation. Only when the middle class is expanded, will it be possible for our society to progress.

This article was edited by Rose Scobie