My China in Numbers

As my summer program is over, and my semester at Beijing University is about to start, I thought it was time to sum some things up.

0: number of times I felt unsafe in Beijing. That’s a record among all my travels: only Hong Kong felt safer to me;

0: number of time I heard ‘economic crisis’ outside the classroom; about 1,000,000 — number of times I heard it in the U.S. or Russia every day;

0.25: cost of one lamb kebab, in USD;

0.6-0.7: cost of a large cup of bubble tea, in USD;

0.7: average cost of a fake DVD, in USD;

1: emergency root canal = 1 cancelled trip to Inner Mongolia;

1: big culture shock so far (see this post);

1.1: average cost of a very filling dinner for one, in USD (that’s just me, of course, and I don’t eat much meat, which tends to be more expensive, but it’s still very illustrative;

2: years I have left at Yale (of which one semester will be spent in Beijing);

3: number of different H&M’s I have gone to one fine day in Beijing (purely for comparison purposes, of course)

4: months I have left in China (which makes me very happy);

6: average number of students in one room at a college dorm in China (1 or 2 at Yale; 2 at Yale-PKU Joint Undegraduate Program, thankfully);

7-14: allowance, per day of rehearsal, that the government pays to the students preparing for the big parade to be held on the National Day (Oct. 1), in USD — the first big rehearsal was held already: check this story.

10: (very happy) weeks I’ve spent in Beijing so far;

35cm (1.1 foot): maximum allowed height for dogs in Beijing (dogs who happen to outgrow it are often put to sleep or simply abandoned);

60: number of years China will be turning on Oct. 1; 1,000,000: number of crazy security measures the government in undertaking;

100: approximate number of cups of bubble tea I consumed in China so far;

570: monthly salary of a teacher at my summer program, in USD (and that’s apparently pretty good by local standards);

800: the approximate number of new Chinese words I learned this summer;

200,000: participants in aforementioned National Day parade;

Over 17 million: Beijing’s population (for comparison, NYC’s population is under 9 million; Moscow’s is estimated to be 12 million)

Infinite: reasons to come to China

The US In Need of Perestroika?

Gorbachev’s 1987 perestroika signaled beginning of the end for the USSR. Perestroika means re-building in Russian; it primarily referred to re-structuring of the Soviet economy, although it did lead to significant political changes in the Soviet bloc. It collapsed, erasing one  of  our two superpowers from the world’s geopolitical map, making for a unipolar and then a multipolar world… and the rest is really poli sci 101.

Twenty-ones years later, Mr. Gorbachev is back proposing a new kind of perestroika: for the US.

America needs perestroika right now. I did a lecture in the US and said the country needs its own perestroika and I got a 10 minute standing ovation,” said the man whose own policies helped trigger the collapse of the Soviet Union. “

(President) Obama’s proposals will be bigger than perestroika. I want to wish success to Obama and his Cabinet, because the problems he has to deal with are not easy ones.

Of course, President Obama is not exactly leading a Communist nation with command economy, but he does need to change, maybe fundamentally, the way economics in the US functions.

Interestingly enough, Gorbachev challenged the communist behemoth and ended up making it capitalist; Barack Obama, president of possibly the most pro-capitalist nation in the world, is perceived as ‘socialist’ by his political foes. He was in fact accused of being a socialist during his campaign. Remember Joe the Plumber’s accusation of Obama being on the ‘slippery Socialist slope’ of trying to ‘spread the wealth’?

Whether it is called socialism, communism, or any other -ism, Obama’s plan to ‘spread the wealth around’ makes sense in this economy. The supposed wonders of free economy led to the worse economic downturn since the Great Depression. What’s worse is its impact on the world; the recession in the US caused a domino effect of national currencies worldwide tanking, trade stalling, consuption fallin, and a myriad other negative effects. At least the USSR’s socialism/communism and its ill economic consequences was limited to only a handful of countries.

As Mr. Gorbachev knows all too well, socialism has many problems. As President Obama is learning, capitalism has serious problems of its own. It seems that what they need is a perestroika of economic theory, not just economic policies.

Catwalks: The Russians Are Coming

“Cheap is the new black,” read a comic in this week’s New Yorker. People consume less, think of creative ways to recycle, rethink, or re-accessorize, and this spring may be ‘lost‘ for this season’s clothes. Yet the haute couture world is still showing itself off in Milan, Paris, and New York City. A friend linked me yesterday to this Newsvine article: apparently, it is Russian that is the new black. At least for Fall ’09-Winter ’10. This is how Newsvine describes one of the shows:

It was like some opening into a doorway of dreams in Russian-Ukrainian fairy tale fantasy dreams,” the first-row guest told reporters backstage.

A Russian-Ukrainian fairy tale? Sounds good to me.

Many a Russian woman who found herself choosing between furs or ugly, bulky, shapeless jackets for a Russian winter will appreciate the fashionable efforts of the designers to make something warm and Russia-inspired (that is, if she can still afford it). The usual array of Russian/Eastern European models made these collections made even more relevant in a cute way.

But now that the designers got their fashion inspirations right, they need to get their weather facts straight.

Citing Newsvine: “Kenzo sent out oversized felt coats and voluminous striped knits that were fit for a Siberian winter.”

Here is a photograph of Kenzo outfit  taken by style.com’s Marcio Madeira’s (btw, it is modeled by a Belorusian):

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Siberia is warming up, but is this fit for a Russian winter? I don’t think so.

“Obama Grants:” Free Money or a Free IQ Test?

When I log on Facebook, I am often offered cash for reporting on my “prep school,” tempted with a discount for a “law school prep” company, offered a “paid investment internship,” or challenged to an “online IQ test.”

Sometimes the ads directly pertain to Yale (e.g., ads for the Yale Rep plays), so I assume the ones above are a product of Facebook’s targeting advertising.

I used to joke sarcastically about the stereotype that the advertisers have about the Ivory Tower. Clearly, to them a typical Yalie is a prep school grad who goes to prep school, gets an i-banking internship, and heads straight to law school, where s/he hangs her IQ certificate on the wall of their dorm.

But as I logged on tonight, there was a somewhat different ad:

"Obama Grants" Ads
"Obama Grants" Ads

I ignored it at first, but it resurfaced in this reincarnated form:

"Obama Grants" Ad 2
"Obama Grants" Ad 2

To be honest, when I saw these ads, I thought that it was some sort of practical joke on the oh-so-smart Ivy-Leaguers. You know, of a kind that would have a huge pop-up window saying “How stupid are you to have fallen for this” when you click on an ad. But the ads link to website where a proud-Texas-firefighter-turned-financial-guru offers you to “get free $12,000 from the government in 30 days.”

Screenshot from the website
Screenshot from the website

The government clearly owes me a bunch of easily accessible cash. Oh wait, I am not a US citizen, and my government clearly does not think it owes me anything. Although I do have a feeling that if I pay $2.99 that Kevin is asking for the “free grant kit,” I might find out that the US government owes me money, too.

So Kevin Hoeffer, a trustworthy-looking fella, claims to have gotten rid of his debt and starting living a nice life (presumably consisting of visits to steak houses in NYC) after getting “free cash” from the government.

I have to admit I don’t know how to react to all this scam. If Facebook does use targeting advertising (and if it does not screen its ads), should I be offended for being considered so stupid?

Maybe I should go take one of those you-are-at-Harvard-but-are-you-a-genius IQ tests.

Will Ukraine’s Economy Collapse?

After the Orange Revolution, it seemed that Ukraine was off to an auspicious beginning. She embraced Europe and the US, denounced Russia, and worked hard on that GDP growth.

With financial gloom dominating Davos, the Israel-Palestine hysteria, and people being laid off by the thousand worldwide, Ukraine and her problems were virtually ignored. While Eastern Europe is whispering about the nearing economic collapse, the most relevant entry about Ukraine’s economic collapse that a Google search in English produces are dated 1993 and 1998, when the economy was truly going down the drain. It looks like 2009 will also join the ranks.

I will not bore you with the details of all the economic troubles Ukraine is facing. If interested in details, read this Jan 19 report, and make all the bad indicators even worse. Then add the constant fighting between President Yushchenko and premier Timoshenko; subtract the non-functioning government. Can anyone say “imminent collapse”?

There was something that drew my attention a few days ago, but I was too busy writing countless applications to blog about it. A story surfaced in the Russian and Ukrainian mass media about a report supposedly written by Ukraine’s finance minister Viktor Pinzenik. In brief, it augurs the nearing collapse of Ukraine’s economy.

Drawing from my own politics-related experience in Ukraine, a fake report to scare the population and intimidate the government would not surprise me. But it was never properly denounced by the Ukraine’s government.

For any interested speakers of Ukrainian, there is a photograph/scan of the report here. After several pages of sad economic stats and a lot of pathos (if someone indeed faked it, they put a whole lot of effort in it), the report concludes with:

An excerpt from what is believed to be Pinzenik's report
An excerpt from what is believed to be Pinzenik's report

“The country is in danger. The citizens are in danger. (Political) power is not an award. It is first and foremost responsibility to people. I would like to emphasize one more time: there is a way out of the current difficult situation. But we are almost out of time…”

There are also rumors that Rada’s (Ukraine’s parliament) employees, including the MP’s, is behind on the salary payments for this month. For all I know, it might be just rumors, but it sounds likely to be true.

As a Ukrainian, I am very upset about Ukraine’s future.

As a political scientist, at least I get to benefit from studying how “dirty” political technologies are used to undermine an opponent in the game of politics.

Although I hope that the report above and all the rumors are not true, it is quite certain that Yale’s poli sci department is probably the safest place to observe Ukraine’s government failures.

Putin v. Oil Prices

Several months ago, before the oil prices began plummeting, I read an article somewhere that left me confused. It was in a well-respected publication — Foreign Affairs, I believe — and written by a serious author. It claimed that if oil prices go below $25/barrel, Putin’s incredible approval ratings will slip, and the leadership of Russia might change. There were other serious articles in serious publications estimating that number to be $4o or even $5o. As I see it, the logic behind these prognoses was as follows : if the inflow of petrodollars stops, the Russians will lose jobs, earn less, not be able to pay their mortgage etc. People will be angry. And they will aim their anger at Medvedev and Putin, ending their almost unconditional support for them.

Now that the oil prices are hovering at $40, it is a good time to analyze these statements and to post factum claim they were incorrect . Oil prices haven’t reached $25/barrel yet, but Russians have been laid off en masse (the unemployment rate went up more than 1% since September, from 5-something% to 6-something%), and there are government agency projections of over 250 thousand more losing their jobs in the first quarter of 2008. Who knows how many more are going to lose their jobs after that? Many companies switched to 4-days workweeks. They cut salaries, and cancelled their employees’ free gym memberships. People are panicking. With the dollar and euro exchange rates going up, it is challenging to find either kind of currency in many provincial cities. Everyone wants to buy foreign currencies to avoid losing much money if the ruble becomes drastically devalued.

Yet, Putin’s approval rating are stellar. And I believe they will remain that way.

Political cycles of the Western world — economy gets worse, the incumbent has fewer chances of getting re-elected, so a new leader steps up, lather, rinse, repeat — do not apply to Russia. The Russians are simply not used to such mode of thinking. Historically, the vast majority of population was in the state of continuous pauperization under the czars. In the USSR, most people were not starving, but not rich, either; they were all equally poor. In the early 90’s, under Yeltsin, food was often rationed. His approval ratings were never impressive, but he did win his second election and had the nation elect the man he hand-picked as his predecessor.

Yeltsin was almost impeached in 1999, only a year after the tough August crisis of 1998. But economic problems were only one of the five charges against him. The impeachment never went through, although it did contribute to Yeltsin eventually resigning. When Yeltsin assumed power, the economy was bad to begin with, and he did not produce any successful or popular reforms. In fact, many people were in doubt whether it was a good idea for the USSR to collapse: breaking up the USSR was another impeachment charge against Yeltsin.

Back then, Russia had an ageing president with serious health and alcohol issues. He had to undergo a seven-hour heart surgery while in the office. To make fun of the videos of him inebriated was a common pastime for stand-up comedians and regular citizens alike. He kept sacking prime ministers and making puzzling decisions, never bothering to explain them to the country. Putin in many ways is the exact opposite. He is athletic, well-dressed, relatively young, and a non-drinker. It easy to assume that someone who is ill and struggles to speak in public and to explain his choices makes poor decision. Likewise, it is easy to trust a control-wielding president who clearly explains his political choices and practices knocking down judo opponents for fun.

But that is not the major difference between Putin and Yeltsin.

Putin gave Russia a direction in which to move. After the USSR collapsed, general population was very confused. In the USSR, people played by the rules, albeit hypocritical and nonsensical ones. In public, one praised the Party; in private, one listened to the Beatles and read books by the dissidents. If one wanted promotion, a new apartment, imported furniture, one knew whom to bribe.

And all of a sudden, it was all over. No one knew what to do, what to say, what to believe in. Even religion, the common last resort at times of upheaval, was foreign and semi-forgotten. The most talented artists, musicians, professionals went to great lengths to immigrate. With fifteen new states, many found themselves having to cross a border to visit friends and family. While some struggled to find morals, some abandoned them altogether and entered the capitalist world of making money.

The charismatic leader who stood on the tank and promised a better future turned out to be as confused as the rest of the population. It was the dark ages of the Russian history, condensed into less than one decade. And then came Putin, and it was a renaissance.

He brought along positive economic changes. Russians began traveling and learning foreign languages. No one had to queue for hours to get regular consumer goods. The gap between the center and the periphery was still drastic, but even the periphery was doing better. The political scientists’ assumption that Putin will stop being so popular is all that is taken away makes sense. But there is something else that Putin achieved.

Russians now know who they are. They take pride on being a strong country that is feared by many states. Nationalism is a way to go. Orthodox Christianity is respected, and churches attract flocks of new believers. To name kids with traditionally Russian names is now a good idea. To memorize the anthem and have a Russian flag is an even better one. Everyone knows in what to believe: Saakashvili needs a sedative, Yuschenko needs a retirement, guest workers need one-way tickets home.

The West finds many of these trends disturbing. But the Russians are not about to give up their new-found identity in exchange for the Western concepts of personal freedoms — that Russia had never had anyway. Putin is a part of that identity, and it would take much more than extra-low oil prices to surgically remove him from it.

There is another ace up Russia’s ruling duo’s sleeves. Since the crises’ first symptoms were diagnosed in the US, the Russian media were successful in equaling the US in general to the root cause of this crisis.”So, how is the US doing? They are guilty of this crisis, aren’t they?” Many Russians feel that the crises is just a continuation of the US’s idée fixe is to destroy Russia.

To be fair, there are articles describing problems with other states’ policies and their contribution to the current global financial crisis, but somehow, they don’t stick with the general population. Anti-American authors and politicians are attracting a lot of attention (check out this Wall Street Journal article about a Russian academic who claims that by 2010, South and North Carolina will be a part of the EU).

This trend of anti-Americanism causes a great deal of the rally effect — people uniting against one enemy. It was successfully used by the post-Soviet states: accuse Russia of all your present troubles, and you got the population supporting you like crazy. Now Russia is using it for its own purposes: to shift the blame to the US, shall if be needed. How can you blame the prime-minister for the crisis, if it the US’s fault anyway?

In 1998, right before the crisis, the government went out of their way to promise nothing really bad would happen to the country’s economy. When the economy collapsed, people felt disappointed and betrayed, just like they did for centuries. Now that the country has leaders who are not afraid to admit 2009 will be difficult, Russians are not about to let go of them.

The Lipstick Effect: Russia, the Beauty Industry, and the Financial Crisis

In the USSR, industrial products were prioritized over consumer goods. While industry produced many tanks and guns and much heavy machinery, women often struggled to find decent make-up or clothing.  Eighteen years after the communist behemoth collapsed, guerrillas worldwide employ leftover AK-47’s, post-Soviet states sell leftover Soviet tanks to African nations, and the levels of make-up consumption are higher than in many historically capitalist countries. Make-up is readily available now, and many middle-aged women rarely reminisce about the times when they literally used to spend one quarter of their salaries on black-market French mascara.make up, russia

It is now the time of the year when it becomes especially obvious how far Russia has come in terms of consumerism. Around New Year’s, Russia’s consumerist equivalent of Christmas, stores are abuzz with customers looking for gifts for their near and dear. With online shopping still undeveloped, the number of customers in the stores is a good indicator of the current economic situation. The unemployment rate has skyrocketed,  petrodollar flow has decreased, stocks are down,  grocery prices went up, and the ruble is being slowly devalued. Yet, the atmosphere is not quite as morbid as I expected. Most stores have not resorted to the unprecedented sales of the US, although many of them have experienced a reduced flow of customers. While the ones selling furniture, expensive clothing, and electronics struggle to stay afloat, the ones offering make-up and sometimes jewelry are — surprisingly — experiencing a wave of consumerism.

In the somewhat pretentious chain make-up store to which I went in hopes of checking off some items of my gift lists, the dreaded krizis was seemingly ignored. The intrepid crowds were joyfully choosing between Chanel, Dior, and Givenchy.  But the displays with more modestly priced brands were even more crowded. The customers were scouting the store for the yellow sales labels, but once they identified them, they often bought multiples of the good. At the register, many were flashing the “gold” discount card,  which one gets after spending an equivalent of $340 at the store (may I remind you that the average monthly salary in Russia in 2008 is reported to be around $700 (in the pre-crisis exchange rate)?.

That sight reminded me of the article I recently read that discussed the “lipstick effect” apparent in Russia right now (here’s a link for the Russian speakers). In short, the “lipstick effect” is an increase in the demand for perfume and make-up during the times of financial instability. Since people can’t afford much, they resort to buying fun affordable goods such as a new shiny, candy-flavored lipgloss. This theory does appear to  be very true right now. Some friends of mine who would have bought more expensive gifts before opted to get perfumes for their male friends or make-up for their females friends instead. Men’s perfumes have been flying off the shelves, a buyer acquaintance of mine confessed. They are replacing the pricier cashmere sweaters, iPods, or cell phones, traditional New Year’s gifts for husbands, boyfriends, fathers, and sons.

Further research suggests the lipstick effect is felt worldwide: from the US to India to New Zealand, “small luxuries” are substituting “extravagant purchases.”  Consumerism is an inherent part of the 21st century, and it is quite understandable that people would go for cheaper goods on which to spend their disposable income when the times are tough. As the name suggests, these effect is primarily facilitated by women. And could you blame them for that? In the times of unemployment and the gloomy Russian winter, inexpensive bright lipstick may be the only available kind of retail therapy.

Although I couldn’t find any quantitative research on the lipstick effect in Russia, I would expect it to be even stronger than in other developed countries. First, there is an entire social strata — young, single, well-educated, middle-class women — who gladly spend their money at the make-up counter. Many of them make enough money to have some disposable income left after paying their bills. But it is not enough to buy an apartment or to take out a mortgage: the salaries are still low, and property prices some of the highest in the world (although the property bubble has been bursting recently). There is not much of an investment culture: years of communism and the volatile post-communist market did not exactly help develop one. Saving for retirement is still a foreign concept to many. So these women resort to renting and spending the rest of the money on make-up, hair cuts, pedicures, and salon anticellulite services.

Then, of course, there is the mentality: the “if you’ve got it, flaunt it” attitude is still de rigueur for many. I know plenty of women who would rather buy a mink coat and be on the potatoes-only diet for the next year or two than buy a regular coat and good food . This ostentatious approach causes producers of luxury good all over to swear by the Russian consumers. Those not rich enough to afford haute couture go for the hot finds of the numerous glossy magazines instead: the new mascara brush, the new season nail polish, the new miraculous anti-wrinkle skin cream. Considering the ridiculously low men to women ratio and a common belief that a woman has to a) get married to be successful; b) wear a lot of make up and be always perfectly groomed to catch a man — you get a perfect beauty industry consumer. There are more beauty salons in place in an average Russian provincial town than I have ever seen anywhere. Just a few months ago, everything was overpriced, but women were happy to pay. I remember running out of lipgloss and finding it to be three times as much in Moscow as I paid in NYC. A friend of a friend reportedly used to make a living by taking Russian upper middle-class women to Berlin, where they would stay at nice hotels, eat at fancy restaurants, and shop excessively. With plane tickets and visa costs, they still spent way less than they would have if they bought the same things in Russia.

Now that incomes are down, purse strings are tightened. The sun has set on expensive salon treatments. The beauty parlors, especially the more expensive ones, attract fewer customers, but women are not about to stop getting highlights. A friendly shop assistant reported a drastic increase in the demand for their home hair-dye kits. Likewise, women are not about to stop exfoliating, moisturizing, and de-wrinkling. Some internet forums featured  women admitting abandoning the more expensive foreign skin care lines and resorting to the reasonably-priced Russian and Belorussian ones instead (which is generally deemed “ok to do, if you don’t admit it publicly and still have a compact and lipstick by a fancy brand to use in public”).

I happen to like a certain hair conditioner that is made in Belarus. Every time I go to Russia, I attempt to buy several bottles — it does wonders for my hair, it’s very cheap, and it’s patriotic (Russia and Belarus are supposedly one state, no?). It is very popular, but I usually have no problems locating it. This time around, it was nowhere to be found. Previous L’Oreal and Schwarzkopf customers were now making an extra effort to find something cheaper and at least of the same quality, and that conditioner happened to be their best bet. Remember Chanel’s Black Satin hysteria two years back? This is actually worse: instead of the civilized waiting lists at Bloomingdale’s, women are said to bribe shop assistants to keep these conditioners for them when they next become available.

If I had several million dollars to spare, I would be very happy to invest in buying up a skin care factory — preferably in Belarus, for the workforce is cheaper there — and to hire chemists, package designers and advertising experts, pay for a  celebratory article in some glossy magazine, and promote my products as de luxe — there will be a high earning potential (and workplaces, too). Do you want to know why I think that? Here is a story:

A sales assistant at that make-up store helped me pick a few gifts, and I commented on the limited selection  of the Chanel nail polishes, given that the new line named after Russia just came out. Oh, she was very worried about it, she said. In fact, she wanted it for herself so badly that she had booked train tickets to Moscow to go to the headliner Chanel store, where said nail polished are still available. The dark red version was her favorite, and she was looking forward to finally being able to wear it.

I later found out that a sales assistant in that shop makes around $400 a month. The cheapest return trip to Moscow would cost around $60; that nail polish retails for $38 in the US, and it probably costs more in Russia. It looks like Russian women are still ready to drop a quarter of their salary on the nail polish. Forget Gazprom. With the oil prices plummeting, make-up may be the way to go.