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Adam Smith
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Maryland, USA
Jan 1970
time: 00:29
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From the Washington Post, Saturday, June 14.
http://www.washingtonpost.com/wp-dy...-2003Jun13.html
Here's the text of the article, since the free access time is about to expire. (Question: Can you reach this part of the Post site from inside China?) Relevant sections are in bold. Note, however, the general conclusion that the government is in bed with the developers.
Progress -- Over Their Dead Houses
Shanghai Residents Resisting Displacement Endure Threats and More
By Peter S. Goodman
Washington Post Foreign Service
Saturday, June 14, 2003; Page E01
SHANGHAI
Families in the central district of Jingan first learned their homes would be demolished from the handbills posted on their doorways. Their old brick houses in the center of this increasingly vertical city sat in the way of the next great project, a complex of 30 residential skyscrapers and two office towers. The residents would have to move.
Next came the take-it-or-leave-it offers of compensation from the district government and its partner, Zhou Zhengyi, Shanghai's wealthiest real estate magnate. Zhou is now under house arrest because of his alleged role in a separate banking scandal, but as the talk of eviction began circulating last fall, he was still at the height of his power.
Even so, the residents opted to resist. They rejected the offers as unfair. Thus began what they say has been a blunt and painful lesson in the workings of power in the world's most populous country, in which public officials acting in concert with private developers routinely seize land and exploit it for mutual gain. It is a dynamic that has some of China's leaders worried that the country's growing affluence is coming at the expense of the poor, fueling hostility toward the government.
Faced with these intransigent residents, contractors working for Zhou's company and the district government began razing vacated houses around residents who remained, turning shaded lanes into dumping grounds of concrete blocks, mangled aluminum and garbage. Residents say thugs threatened them with unspecified peril if they stayed. One household had its gas line cut. Another says it lost phone service. A third found its water pipe severed.
Last week, the residents said, a peasant arrived with a plastic bag full of human excrement and began strewing it about the lanes. "We confronted him, and he told us that the district government paid him five kuai [about 60 cents] to dump it, plus two kuai [about 25 cents] for every window he could break to encourage us to leave," said Tao Jianhua, one resident. "This has completely undermined our trust in the government. This is supposedly a people's government that represents the interests of ordinary citizens. But they just represent their own interests and the interests of developers. They are just using the Communist name to do all this gangster stuff."
When six families living on the project site turned to the legal system to protect their interests, they got another glimpse of the considerable forces behind the project. The families hired a lawyer, Zheng Enchun, who filed a class-action lawsuit representing more than 2,000 residents to stop the demolition. On June 6, after Zheng circulated documents showing that Zhou's company had received some of the land for free from the city, Shanghai police arrested Zheng on charges of obtaining state secrets and took him away to detention, according to the Shanghai Morning Post, a government-controlled newspaper.
These days, China's elite circles are buzzing with talk of the downfall of the man responsible for the project -- Zhou, 42, who began work as a dumpling vendor, then gravitated to buying up shares of faltering government-owned companies, before launching into real estate in the mid-1990s. Last year, he was ranked by Forbes magazine as China's 11th-richest man, with a personal fortune of $320 million. Along the way, he gained notoriety as well as a taste for sports cars, the company of young actresses and multiple homes.
According to state news accounts, Zhou is now under criminal investigation in connection with a $270 million loan he secured from the Bank of China to buy stock. But the Financial Daily newspaper reported that Zhou's detention was in part the result of official concern over the controversy his project has provoked in the Jingan district
In part, Zhou's fall underscores the seamy ways in which wealth is often accumulated here, particularly in the booming real estate business. In China, the state still largely controls land and finance. For entrepreneurs, gaining access to either often requires currying favor with government officials who are keen to extract a slice of the spoils.
In China, it is widely assumed that corruption is so ingrained in the normal course of doing business that all prosecutions are political in some way. Some people here speculate that Zhou's downfall is explained in part by worries in higher quarters about the callous ways that he and his allies in the Shanghai government have gone about building ever larger projects with little regard for the people displaced.
In recent months, President Hu and Premier Wen Jiabao have made prominent speeches in which they have fretted that a growing gap between rich and poor could jeopardize social stability while fueling perceptions that developers are preying on the powerless.
When word of the project first filtered out, many residents welcomed it as a chance to improve their living conditions. From the outside, their old brick homes appear solid, even stately. On the inside, whole families share single rooms with exposed wiring and pipes, grease-stained kitchens tucked into corners and bare concrete floors explored by rats.
Under a city government policy nominally aimed at improving the housing stock, Shanghai makes large tracts available to developers, sometimes free of land usage fees. But the regulation requires that developers who gain free tracts allow displaced residents to buy new homes on the same sites at an affordable price.
According to a May 2002 contract, Zhou's company was given "free" development rights to one of the eight parcels in his Jingan project. (His company did have to pay about 12 cents per year per square meter to the city). The same document shows that a development company controlled by the Jingan District government -- the Jingan Urban Construction Investment Co. -- owns a 1 percent stake in the venture.
But when Jingan Urban began outlining offers to the residents last fall, there was no mention of new housing. Rather, the company offered to buy out the residents for about $500 per square meter.
Zhou Daye and his family have lived together in two rooms in Jingan since the 1970s. The buyout would have traded their home for about $33,000 in cash. That would have bought them a decent apartment only in a distant suburb, with little transportation or access to shops. In the skyscrapers that now soar over their lane, it was at most half of what they would need to contemplate a purchase.
The residents say that when they began rejecting the offers, officials from the district government began warning that they risked getting nothing.
"They would say, 'If you don't want to sell, you still need to move out,'" said one resident, Xu Yili. She said one man from Jingan Urban Construction, Gao Maoyuan, regularly confronted people. "He would hover over you and spit on you and say, 'The land belongs to the head of the district. How do you think you can oppose this?' "
When this reporter visited Gao's office, he refused to comment. Guards in the marble lobby of Zhou's office tower in the Jingan district barred entry to his company's headquarters. A spokesman did not return repeated calls.
One morning in late April, Zhou Daye heard people outside his ground-floor flat and went out to investigate. A man from Jingan Urban Construction, escorted by a half-dozen Shanghai police officers, was there to present eviction papers to the family who lived upstairs. According to Zhou Daye, when he asked what they were doing, he was arrested and detained at the police station for a week on charges of interfering with government affairs.
"They are using the same methods as during the Cultural Revolution," he said. "Then, they used the flag of revolution to justify beating people up and throwing them out of their houses. Now, they are using the flag of building the future to do the same thing, and all they are really doing is enriching themselves while we ordinary people suffer."
Last month, days after the first news reports of the investigation of Zhou Zhengyi, 23 residents got together to do the sort of thing that is normal fare in countries whose officials are elected: They wrote a petition, affixed their signatures and sent it off to President Hu and Premier Wen demanding a broad probe of corruption in Shanghai.
"Zhou conspired with officials within the Shanghai government and Jingan district government to steal a large piece of land," the petition read. "The exposure of the big liar Zhou Zhengyi offers a chance to uncover related corruption within the Shanghai government. We, the citizens of Shanghai, await your reply."
They have yet to receive one.
Special correspondent Wang Ting contributed to this report.
© 2003 The Washington Post Company
(edit: formatting)
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20-06-2003 18:41
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