High cost of living it out in the city
By Qi Zhai (China Daily)
Updated: 2010-09-02 10:10
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After being back in Beijing for a year, I am starting to come out of my honeymoon period.
I no longer rave to friends in New York about spending 30 yuan ($4.40) for a fantastic manicure when they have to pay $20, because I realize it cost me another 40 yuan in cab fares to get to and from the nail salon. Plus, how do I assess the value of 40 minutes spent inhaling exhaust fumes in gridlocked traffic under Changhong Bridge?
The bargain deals at Yaxiu have also lost their appeal. I have to throw away two batches of trendy clothing I bought there since they fell apart after a few washes. The shoes also needed to be repaired after a single season. Luckily, my signature Ray-Ban glasses are still holding up, but when the temples on these 15 yuan babies give out, I'll probably replace them with authentic specs. As they say, yi fen qian yi fen huo, "you get what you pay for".
When I started hunting for digs in the heart of town, I was surprised by how quickly housing prices had risen. Nominally, renting in Beijing is cheaper than renting in Manhattan, but living alone with modern amenities is a luxury in both cities.
Six months ago, a friend of mine was living in a posh studio at The Place for 4,500 yuan a month. When I recently checked back on the building, real estate agents scoffed at the idea of finding anything under 6,500 yuan.
"But what about the global economic slowdown and all the apartments sitting empty in Beijing?" I asked.
"Sorry, sweetheart," I was told. "This is China and asset bubbles are still de rigueur."
The bottom line was Beijing is expensive. If a former financial industry peon and "sea turtle" like me finds the city pricey, how ordinary Chinese people feel? With a lot of stress.
Almost everyone feels the pressure of coping with high living costs, but no one has the solution. The government keeps a grip on the gears, shifting up or down to strike a balance between affordable housing and economic growth.
Meanwhile, over the Internet, young people express their frustration over being unable to fulfill the Chinese dream of owning a home.
Last week, I was invited to host a talk show on Youmi, a popular Chinese webcast. While my show (about studying abroad) generated interest, the episode that drew a record number of viewers on Youmi that week featured Ren Zhiqiang, the real estate tycoon. People wanted to hear what he had to say about property prices - so much so that he has been booked to appear again this week.
Besides housing, which is a major expenditure in markets outside of Beijing and China, other goods are costly as well. Cars and luxury goods, for example, are heavily taxed. Food, a basic staple, is deceptively dear. A meal for two average office workers going out on a date during the week can easily cost $10 at a Beijing fast-food restaurant. The same meal would probably cost $20 in New York.
While Beijing is cheaper, the spending ratios are out of whack. The CIA's official estimate of per capita GDP in the US (in terms of purchasing power parity) is about 7.5 times more than that in China. So, how do Chinese people live when they make one-seventh of Americans, but spend half as much as Americans on their meals?
The question arouses my curiosity even more when I try to reconcile relatively low income figures - an average office worker with a "decent" job in Beijing makes somewhere between 5,000-8,000 yuan a month - with the rampant consumption I see around me. (A friend who works as an anchorwoman for a well-known television station confirmed the figures. She said that even prestigious presenters are "very poor" on the basis of their salaries.) From orange Lamborghinis to 80 yuan cocktails in Sanlitun, are Chinese people living beyond their means?
Partly, yes. Chinese people do believe in having the appropriate pai chang ("set up"). To get business done, you need to spring for the necessary expenses, like lavish dinners and fancy wheels, even if it means going into debt.
But, I believe, a bigger part of the answer lies in "gray income". From teachers moonlighting as private tutors to office workers earning wai kuai ("outside income"), many in China seem to have more than one gig. And some of it may not be dutifully taxed.
Perhaps it's the "gray income" that helps Chinese people to get by. If that is the case, I hope someone will quickly sign me up for some wai kuai!
