Make Manchuria great again: Can China’s rust belt be revived?

A factory in Yanji, China, in 2007. Image: Getty.

In 1949, Mao gave China First the role of making China great again from its base in North East China. Ignoring his Soviet advisors, Mao believed that China’s path to prosperity was through heavy industry: that meant building on the industrial base left by the Japanese Empire in Manchuria.

For decades, China First and similar state-owned companies provided secure, well-paid employment to Manchurian workers whose ‘Iron Rice Bowl’ was the envy of the nation. Many of China First’s early recruits were still working there in the 1990s.

Today, things don’t look so good. After a decade of lay-offs, its losses are still growing, and stood at $850m last year. Chairman Wu was found hanged in his office during a corruption investigation in 2015. While the region’s GDP per capita is about average for China, it is in relative decline.  In 1978, China’s north east provinces of Liaoning, Heilongjiang and Jilin were the 4th, 5th and 8th richest. Now they are 14th,21st and 12th. What’s gone wrong?

The administrative divisions of China. Manchuria consists of the three provinces in the far north east. Image: Wikipedia.

Mao’s heavy industrialisation policy may have made Manchuria rich – but since his death, nowhere has followed the Manchurian path to prosperity. Instead, Deng Xiao-Ping’s model had privately-owned textile factories, rather than state-owned steel mills, in the vanguard.

These new factories didn’t come to Manchuria: investors were looking for cheap labour, and Manchuria had the most expensive workers in the country due to its Mao era economic success. Instead, they came, initially, to China’s coasts.

Now those regions that started off as sources of cheap labour for Japanese investors have moved on. Shanghai and Guangzhou are major global financial centres. Hebei Province is the steel capital of the world. So why was Manchuria, which started a few stations down the track, unable to get on the Deng Xiao-Ping train as it passed them by?

Firstly, imagine a combination of what John McDonnell thinks about bankers and what Ian Duncan Smith thinks about welfare claimants: that is how north-easterners are seen by large numbers of other Chinese people.  Most Chinese believe they worked for their own prosperity, but the three north eastern provinces were gifted prosperity by Mao, and now stay afloat via subsidy and corruption. Good Maoists make for bad capitalists. Whether this is fair is beside the point: it deters investment.

Secondly, geography. Being at the crossroads of the Communist world may have been an advantage in 1950; but now it puts Manchuria in the middle of an economic nightmare zone, between the crashing Russian economy and North Korea which keeps on North Koreaing.

Finally, demographics. Even before the One Child Policy of 1982, Manchuria’s fertility rate had fallen below the replacement rate. That policy was also more effective in Manchuria than anywhere else, with fertility rates falling to just 0.75 births per woman by 2010. It’s not surprising that, in the provinces with the highest rates of government employment, more people would obey government policy. On top of this, there has been huge net migration: 2m workers left the north east for southern provinces between the 2000 and 2010 censuses.

So, as Lenin asked, what is to be done?

The Chinese government has had two main strategies. First is transport. My hometown of Yanji (about the size of Bristol) boasts several 150mph+ services a day to cities in the region hundreds of miles away, as well as a daily service to Beijing (about as far as Bristol to Berlin).

Over 1,500 miles of highspeed railway has opened in Manchuria in the last 5 years, and more is being built. Buses to smaller towns in the region are cheap, regular and mostly travel along motorways built in the last 20 years.

No doubt this growing connectedness has helped the local economy – but it has not stopped Manchuria falling behind the coastal provinces, largely because new motorways and high speed rail are national megaprojects.

China’s rail network. Click to expand. Image: Howchou/Wikimedia Commons.

The second strategy is keeping the order books of local government-owned factories full. New trains roll off the production lines in Changchun, tanks in Qiqihar and steel pretty much everywhere. However, this has not closed the gap either.

Some have bold plans, but it is not clear they’d be effective. Justin Yifu Lin, former chief economist of the World Bank, argues that the region should target those light industrial businesses that set up on the coast decades ago and are now on the move again looking for cheap labour. He also suggests greater efforts to get workers out of the fields and into the cities.

But it is not really clear why a business owner would opt for remote, moderate wage Manchuria over better located, lower wage provinces further west – nor why farm workers shouldn’t just move south as they have been doing for decades.

Government economist Fan Hengshan hinted in an interview with the China Economic Times that he believes Thatcherite style shock therapy – privatise the state owned companies and fire the planners – will boost growth. It is not made plain why these companies would be better at updating the regions decaying industrial base than the government.

Economist Andrew Batson suggests opening branches of the China’s best universities to boost the local skills base and partially reverse the population decline.

But Manchuria already has three of the country’s top 25 universities. The problem is that local students see admission as their ticket out of Manchuria, while those from outside the region rarely stay. A brief non-scientific survey of undergraduates I know from my town’s university found no-one originally from outside the province who intends to stay after graduation: one laughed at the suggestion. 

Manchuria resembles the rust belts of the western world and the problems seem similarly intractable. Just like in the west, relative decline has provoked a political backlash, though it takes a different form than in the west. (As annoying as I am I have not yet sparked an anti-immigrant backlash.)

Industrial decline has created workers’ movements. As China is a worker’s paradise, trades unions are illegal, so keeping track of what are by definition wildcat strikes is hard. The government likes to pretend strikes afflict only foreign owned companies, and certainly never state ones.

Nevertheless thousands of strikes are recorded every year by the Chinese Labour Bulletin. The regions heavy industries were described as “a disaster area” for not paying employees on time by the People’s Daily in January. Miners have been striking and protesting in large numbers in the city of Shuangyashan. This may intensify as the government has announced ‘restructuring’ plans that will lay off almost 2m steel and coal workers.

In Manchuria it will be difficult for the newly unemployed to find work. Manchuria’s reign as China’s richest region is over – but after four centuries at the centre of Chinese history it might not be quite ready to step aside yet.  

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America's cities can't police their way out of this crisis

Police deployed tear gas during anti-racism demonstrations in Los Angeles over the weekend. (Mario Tama/Getty Images)

As protesters took to the streets across the United States over the weekend to express their anger at police killings of unarmed black Americans, it was hard to miss the hypocrisy coming from local authorities – including the otherwise progressive, left-leaning officials who are in power in most major American cities. 

Many US mayors and their police chiefs had issued public statements over the past week that seemed – only briefly, as it turned out – to signal a meaningful shift in the extent to which the Black Lives Matters movement is being taken seriously by those who are in a position to enact reforms. 

The sheer depravity of the most recent high-profile killing had left little room for equivocation. George Floyd, 46, died last Monday under the knee of white Minneapolis police officer Derek Chauvin, while three additional officers helped to hold Floyd down, doing nothing to aid him as he begged for them to stop and eventually lost consciousness. The officers had been attempting to arrest Floyd on suspicion of having used a counterfeit $20 bill at a deli. All four have since been fired, and Chauvin was arrested Friday on charges of third-degree murder and second-degree manslaughter. 

“The lack of compassion, use of excessive force, or going beyond the scope of the law, doesn’t just tarnish our badge—it tears at the very fabric of race relations in this country,” Los Angeles Police Chief Michel Moore told the Washington Post in response to the Floyd case. Meanwhile Moore’s boss, Los Angeles Mayor Eric Garcetti, on Friday claimed that he understood why his city, which is no stranger to police brutality, was protesting. “We absolutely need as a nation, certainly as a city, to voice our outrage, it’s our patriotic duty to not only stand up for George Floyd but for everybody who has been killed unnecessarily, who’s been murdered for the structural racism that we have in our country,” Garcetti said. 

Normally, US police chiefs and mayors tend to ask citizens to withhold judgment on these types of cases until full investigations can be completed. But a 10-minute video recording of Floyd’s killing had made what happened plain. Police chiefs across the country – and even the nation’s largest police union, which is notorious for defending officer abuses – similarly condemned the actions of the Minneapolis officers, in a rare show of moral clarity that, combined with the arrest of Chauvin, offered at least a glimmer of hope that this time things might be different. 

As the events of the weekend have since shown, that glimmer was all too fleeting. 

In city after city over the past three days, US mayors and their police chiefs made a series of the same decisions – starting with the deployment of large, heavily armed riot units – that ultimately escalated violent confrontations between officers and protesters. Images widely shared on social media Saturday and Sunday nights made it clear that members of law enforcement were often initiating the worst of the violence, and appeared to treat protesters as enemy combatants, rather than citizens they were sworn to protect. 

In New York City, two police SUVs were seen plowing into a crowd of protesters, while elsewhere an officer was recorded pulling down a young protester’s coronavirus mask in order to pepper spray his face

In Louisville, the city where Breonna Taylor, a 26-year-old black woman was fatally shot by police on 13 March, state police in riot gear were captured confiscating and destroying protesters’ supplies

In Minneapolis, forces opened fire with nonlethal rounds on residential streets, much to the shock of homeowners standing on their own front porches. 

Images of police pushing or shoving peaceful protesters were almost too numerous to count, including, in Salt Lake City, an elderly man with a cane

In many places, police also targeted journalists who were covering the protests, firing at clearly identifiable media crews with rubber bullets, injuring and even arresting reporters

Some protesters did commit acts of vandalism and looting, and the leaders of cities where that happened generally responded in the same ways. 

First, they blamed “outside agitators” for the worst protester behaviour, a claim that harkens all the way back to the civil rights era and for which the evidence is murky at best

Next, they enacted sudden curfews with little to no warning, which gave law enforcement an excuse to make mass arrests, in some cases violently. 

In a pair of widely criticized moves, Garcetti of Los Angeles closed the city’s Covid-19 testing centers and suspended the entire mass transit system Saturday evening, stranding essential workers on their way home from daytime shifts. Late Sunday night in Chicago, the city’s public school system halted its free meal distribution service for low-income children, citing “the evolving nature of activity across the city”.  

Governors in at least 12 US states, in coordination with city leaders, have since called in National Guard troops to “help”. 

At this point it’s clear that the leaders of America’s cities are in desperate need of a radically different playbook to respond to these protests. A heavily armed, militarised response to long-simmering anger toward the heavily armed, militarised approach to American policing is more than ironic – it’s ineffective. Granting police officers wider latitude to make arrests via curfews also seems destined to increase the chances of precisely the tragic, racially biased outcomes to which the protesters are reacting. 

There are other options. In places such as Flint, Michigan, and Camden, New Jersey – both poor cities home to large black populations – local law enforcement officials chose to put down their weapons and march alongside protesters, rather than face off against them. In the case of Camden, that the city was able to avoid violent clashes is in no small part related to the fact that it took the drastic step of disbanding its former police department altogether several years ago, replacing it with an entirely new structure. 

America’s cities are in crisis, in more ways than one. It’s not a coincidence that the country has tipped into chaos following months of emotionally draining stay-at-home orders and job losses that now top 40 million. Low-income Americans of colour have borne a disproportionate share of the pandemic’s ravages, and public health officials are already worried about the potential for protests to become Covid-19 super-spreading events.

All of this has of course been spurred on by the US president, who in addition to calling Sunday for mayors and governors to “get tough” on protesters, has made emboldening white nationalists his signature. Notably, Trump didn’t call on officials to get tough on the heavily armed white protesters who stormed the Michigan Capitol building over coronavirus stay-at-home orders just a few weeks ago. 

US mayors and their police chiefs have publicly claimed that they do understand – agree with, even – the anger currently spilling out onto their streets. But as long as they continue to respond to that anger by deploying large numbers of armed and armored law enforcement personnel who do not actually live in the cities they serve, who appear to be more outraged by property damage and verbal insults than by the killings of black Americans at the hands of their peers, and who are enmeshed in a dangerously violent and racist policing culture that perceives itself to be the real victim, it is hard to see how this crisis will improve anytime soon. 

Sommer Mathis is the editor of CityMetric.