China’s wealth gap poses problems for Beijing’s policymakers
Social media backlash on the influential rich illustrates the challenges facing the Communist Party
A super-cool celebrity television show has triggered a heated debate about the ballooning wealth gap in China.
It revolved around the controversial issue that 600 yuan or US$101 was not enough to cover the costs of one celeb’s daily eating habits.
“We have to eat better, I cannot eat with such low standards,” Su Mang, the former editor-in-chief of Harper’s Bazaar China, was reported as saying on the reality TV series 50km Taohuawu, a celebrity Big Brother-style program.
Later, she backtracked on the comments and stressed that 650 yuan was for her entire time on the show, which could last up to 21 days.
But by then, the damage had been done.
“She can try to explain it away, but the truth is that celebrities are elitist without realizing it,” one person wrote on the Twitter-inspired Weibo social media site.
China’s “Devil Wears Prada”
Su is considered a style icon in the world’s second-largest economy and is known as China’s “Devil Wears Prada” after the Hollywood movie. BOF, or the Business of Fashion, has described her as “one of the most influential figures” in the country’s fashion industry.
“Su is the former president and CEO of Trends Media Group, which she built over two decades into a powerhouse magazine publisher with 18 titles, including the Chinese editions of Cosmopolitan, Esquire and Good Housekeeping,” BOF reported.
“In March 2018, the company announced Su’s resignation, citing personal reasons for her departure. She left the company two months later,” it added.
Since then, she has cut a high-profile in business circles. But her remarks on 50km Taohuawu left Weibo users fuming. Many pointed out that their daily meal allowance was just 30 yuan or $4.70, the BBC reported.
Rich man, poor man
Celebrity excess has become a hot topic on social media along with China’s billionaire club. President Xi Jinping’s ruling Communist Party fears massive wealth imbalance could even spark social unrest.
“They [the CCP] are worried that could trigger something like the 1989 pro-democracy movement. They are very aware of growing discontent and a widening gap between rich and poor, as well as a large number of young people who have no real future,” Wu Zuolai, an independent scholar, told Radio Free Asia.
Widening wealth gap
Data from the National Bureau of Statistics has shown that China’s average annual income is just 32,189 yuan or $5,030. On a monthly basis, that is about 2,682 yuan or slightly more than $430.
In comparison, China’s billionaire club is expanding rapidly.
“Not only did its billionaire population explosion dwarf all others in 2020 but together they added nearly $1 trillion to their collective fortunes, which nearly doubled as a share of GDP to 15%,” Ruchir Sharma, the chief global strategist at Morgan Stanley Investment Management, wrote in the Financial Times last month.
“To get rich is glorious”
Deng Xiaoping, the late paramount leader, was widely quoted as saying this in the 1980s. Even if it is a myth that has become part of folklore or mínsú xué, China’s business community has taken it to heart.
But as Sharma, of Morgan Stanley Investment Management, pointed out Beijing has struggled to “square vast fortunes with what is left of Maoist values” from a bygone era.
“Before the 2010s, Beijing seemed to be enforcing an unwritten rule that no fortune should surpass $10 billion. Tycoons, whose net worth approached that mark, tended to find themselves cut down suddenly by government investigators,” he said.
“As big internet companies took off, the net worth of their founders shot up and, perhaps before authorities could react, surpassed $10 billion for the first time in 2014,” Sharma added.
“Just seven years later, there are more than 50 Chinese deca-billionaires. In their efforts to rein in leading internet tycoons, Beijing appears to be reasserting control,” he concluded in the Financial Times.