Field notes on precarious development in China’s boom city
Michael Alexander Ulfstjerne
2011 was a turning point for Ordos, a municipality located in the Inner Mongolian Autonomous Region of China during which a period of dizzying economic growth and lavish expenditure was exchanged for shrinking dreams amid decaying urban infrastructure. Extensions of credit became unpaid debts.
I was an interloper in this city of dreams. I first wrote about my encounters in Ordos while conducting research for my PhD dissertation.
While bubbles and booms undoubtedly make great movie scripts, making sense of these events is not so straightforward. In trying to find a way through the maze, I conducted my first attempt at an interview; it was with a group of young investors during the summer of 2011, a period when boom rapidly turned to bust.The conversation went as follows:
Michael: ‘I’ve come from Denmark to do research here’ (research in mandarin Chinese is yanjiu, here badly pronounced)
Zhuhui: ‘ah, you’re in the cigarettes and liquor business’ (yan=cigarettes; jiu = wine)
Michael: ‘No, research.’
Michael: ‘I am from Copenhagen University in Denmark and have come to Ordos to do research on urban development.’
Zhuhui: ‘Hmmm, so Denmark is a developed country. What kind of cars do you like to drive there?’
Michael: ‘Well, I am not sure Denmark is more developed than here. Development takes a completely different form. For example I don’t really have a car, and only use a bicycle to get round. Bicycles are better for the environment and they might even get you a little exercise. … So what kind of business do you do here?’
Zhuhui: That’s right [pauses]. Would you prefer a BMW, an Audi or a Mercedes?’
Michael: ‘Well, I don’t know. Many drive second-hand vehicles in Denmark so there are not that many brand new cars’ [longer pause, smoking] ‘I personally quite like the Audi.’
Michael: ‘But many like BMWs and most taxi-drivers prefer Mercedes. My mother drives an old BMW.’
Zhuhui seemed more pleased with my last response. He had just purchased a brand new BMW. Despite Zhuhui’s fondness for fine-tuned German luxury, the Range Rover was a symbol of the city – Ordos had the highest Land Rover rate relative to population in China, even outnumbering the number of local taxis. Yet, a recent surge in local informal financial ventures was spurring a new competing breed of transport: BMWs, Mercedes and Audis better suited urban banker and investor types. Even Maseratis and Porches could be seen speeding up and down newly constructed streets.
Zhuhui was representative of a new breed of young guys who had formed locally based investment companies in the heyday of Ordos’ boom. ‘Overnight investors’ competed to fill the surplus of available floor-space in new towers. Inside offices young men crowded around office desks-cum-card tables. ‘Struggle against the landlord’ was a popular card game along with the inevitable Mah-jong and computer gaming: a seamless mix of male Gucci purses and their counterfeits were filled with stacks of cash, fuelling the intensity of office pastimes along with the use of local uppers.
Zhuhui was settling into new office spaces when we first met. The air was thick with the smoke of expensive brand cigarettes. Commonly used to sweeten the decision-making of cadres, high-end cigarettes and liquor had found its way into the broader population, what might have been the reason for his interest in my profession as yanjiu. The local brand, Erdos Cigarettes, peaked at around 350 RMB a packet in 2010 and 2011, signalling not only conspicuous consumption but also a clear index of rampant corruption. With the heightened attention from the central government by 2012 a ban was issued prohibiting the Erdos brand from exceeding 100 RMB a pack.
Ordos was a latecomer. Later than most. ‘We used to migrate to other areas of Inner Mongolia, doing hard labour. Now it’s the other way around. Nobody here does any hard labour … we simply don’t need it anymore’, one of the investors explained to me. Since the discovery and extraction of Ordos’ abundant resource reserves, the city spurred a rash of urban developments: up and outwards, affording residents a sense of moving from the periphery and into the centre. And, according to some, even beyond.
In the 2000s Ordos was a paradigmatic exemplar of successful modernization and economic development of inland territories: ‘Ordos is the Chinese Dubai’ was a common refrain; I was also told that ‘the city will surpass Beijing.’ One official prophesized how in the future people would look back on Ordos’ development as the next wonder in the line of Chinese model cities: Shenzhen > Shanghai > Tianjin > Ordos.
From my conversations with residents it appeared that the collective memories of poverty, inadequate infrastructure and low-paid hard labour were suspended in what most at the time believed was a never-ending wave of expansion: of investments and business schemes, ambitions, social networks, banquets, extra-marital affairs, drinking sprees, and, of course, of the city itself. Rarely anyone dwelled in the past.
The phenomenon dubbed the ‘Ordos model’ was one in which urbanization, and particularly the real estate market, soaked up local cash reserves and the windfall profits of extractive industries. Whereas for most Chinese, home-ownership requires years of labour, savings, mortgages and family-debts, the glut of home sites in Ordos was a form of tangible investment for a large part of the local population, many of whom had received generous relocation payments from the comprehensive resettlement schemes needed to pave the way for the city’s ambitious upgrades.
During the boom local property titles circulated at ‘Ordos Speed’, paralleled by promissory notes far exceeding the legal boundaries of allowed interest rates. IOUs were written on small slips of paper, on the side of cigarette boxes, in some cases millions of RMB shifted hands on mere promises of return. Informal lending at high interests was the key driver behind the real estate frenzy as well as the backbone of household consumption: people from most strands of society in Ordos expressed a newfound taste for ‘the sweet taste of dividends’ or were living from ‘eating interest’ as they liked to phrase it. An appetite for money relegated local lamb dishes to a distant second.
Even if it had been possible to curb or regulate the vertiginous surge of escalating interest rates in local lending schemes and debt-financed real estate ventures, the local government’s opportunistic lack of regulation seemed to add fuel to the fire.
A community of the bubble
While local corruption and bribery were commonly reconciled in the context of economic growth, other manifestations were silenced or simply ignored. Rumors of a local bubble-economy were strongly refuted. When asked what would keep buyers’ attention, interlocutors either pointed to the municipality’s abundant resource reserves or answered with repetitive and normative assumptions about the intrinsic value of modernized property.
The inflation of Ordos’ twin bubbles of informal finance and real estate was not simply a question of greed, frenzy or the fact that the local population had been sidelined by China’s coastal boom. Beyond these commonly found explanations a particular sense of community had formed in the city’s accelerated reality, one that would actively discard or un-see any signs of impending bubbles.
Although many local informants discarded ‘malicious rumours’ of ghost towns and bubbles as outsiders’ misconception of the local economy, several post-crisis statements from the same people paradoxically suggested that not all were surprised when the bubble burst. Had they lied, then? To what extent were people aware, yet simply keeping up appearances?
There is no simple answer to the question. In Ordos, new horizons of possibility emerged with radical changes in the built environment. Social networks and established structures of authority and power were partly reconfigured, values reshuffled. Atmospheres dense with expectations of upward mobility helped shape a community that cut across ethnic boundaries, gender, age and occupational groups.
Clear lines between reality and fantasy, lies and truths, depths and appearances were not only effaced but co-existed seamlessly in the boom and the forms of sociality that it afforded.
The way locals would actively un-see the excesses of the city’s conspicuous building spree should not necessarily be understood as efforts to veil some underlying truth. Many were willing to define community boundaries according to ambiguous domains of discourse and practice. Wealth was real and never-ending, until it was no more, echoing the title of Alexei Yuchak’s illuminating book on the last Soviet generation.
Thinking back on my first attempt to interview Zhuhui, it almost makes sense. He was just as confused as I was. Zhuhui’s hearing disposition together with my imperfect pronunciation pointed to a perfectly logical question: why on earth do research? Why wouldn’t you be in the liquor and cigarette business?
In the initial months of fieldwork most questions about urban planning, schemes of modernisation, civilisation campaigns and so on often ended up in conversations about plans to expand business, money, and the quality of vehicles and drivers. Development at ‘Ordos Speed’ brought with it a form of sociality that left little room for deeper contemplation: not insomuch as interlocutors were indisposed to deep contemplation. More to the point is the fact that the pace of development and the allures of new commodities suddenly within reach generated a certain outlook and social demeanor.
Like the Snoopy anti-safety device that kept me ‘unsafe’ on many cruises around the city inside the cars of local residents, the atmosphere that prevailed in the boom-years served to impede reasonable speed limits. These excesses were fuelled by wealth that proved temporary, and in light of the violence, abductions and suicides that followed in its wake, precarious.