An ever-growing middle class has been emblematic of China’s ascent ever since Deng Xiaoping kicked off the country’s economic transformation in the 1980s. That progress now risks being reversed as millions of people in China face rising living costs, fierce professional competition, a real estate bubble and sluggish growth.
Chinese President Xi Jinping opened the 20th Communist Party Congress on Sunday, during which he is expected to become the first leader since Mao Zedong to be handed a third term. Xi has made his “Chinese Dream” of a flourishing middle class central to his vision for the country. However, economic headwinds are buffeting China’s vast bourgeoisie – posing a new challenge for Xi.
Xi can cite a strong record as he looks back on his first decade in power. Millions more Chinese have been lifted out of poverty, benefitting from 6 percent average annual growth. It is estimated that between 350 and 700 million people belong to the middle class – compared to about 15 million at the beginning of the century.
“China has been profoundly transformed at great speed,” said Jean-Louis Rocca, a sinologist at Paris’s Sciences-Po University specialising in the Chinese middle class. “In just a few years, hundreds of millions of Chinese have become the first in their families to go to university and then get well-paid jobs, and consumption patterns have changed accordingly.”
‘Declining quality of life’
However, the Chinese Dream now appears to be slipping away. The Chinese economy grew by just 0.4 percent year-on-year in the second quarter, a marked slowdown from China’s robust growth after its early success in managing the pandemic.
Xi’s interventionist economic policies have prioritised China’s strict “zero-Covid” strategy over growth while clamping down on tech titans like Alibaba and the Tencent conglomerate. Meanwhile, the trade war with the United States has heated up, with the US Commerce Department imposing sweeping new restrictions on exports of semiconductor technology to China on October 7.
“Incomes are no longer rising while the cost of living is increasing by leaps and bounds,” Rocca said. “And there is a lot of social pressure. To be considered 'successful,' you’ve got to be able to live in such and such a neighbourhood; send your children to such and such a school; wear clothes from this brand; and own that make of car.”
Health costs are soaring as well, as Chinese society is ageing rapidly. “People are feeling a decline in their quality of life,” said Rocca.
But expectations are still rising – notably for China’s youth – creating a glut of highly educated people vying for the same positions.
“Never before have so many people graduated from university, but not all of them get a job after graduating,” Rocca noted. “Unemployment among well-qualified young people is at nearly 20 percent. Some are accepting low-paid jobs as the 'least-bad' option – and they’re seeing the successful life society tells them to have slipping away.”
From ‘lying down’ to ‘let it rot’
China’s property market further exemplifies the fading of the Chinese Dream. “If there’s one symbol of fulfilled aspiration in China, it’s owning a home,” Rocca said. On the surface, the situation looks good: 87 percent of households own their own property, and 20 percent own several. But the situation is bleak for young people, many of whom find it virtually impossible to afford their own homes. Rampant land speculation has caused prices to soar, creating a property bubble looming over the economy. Rents have become prohibitively expensive, especially in the biggest cities like Shanghai and Beijing.
In this context, many young people have decided to lower their ambitions: The term “tang ping” (lying flat) has been making the rounds on social media in recent months – the idea being to opt out of pursuing success in favour of adopting a simpler lifestyle:
The movement emerged from a 2021 viral blog post by Luo Huazong, a young man recounting how he quit his job as a labourer, moved to Tibet and started living frugally off occasional odd jobs and savings, with a budget of $60 a month. “After working for so long, I just felt numb, like a machine,” Luo told The New York Times. “And so I resigned.”
Since then, testimonies of weariness about the rat race have proliferated on the internet – although Chinese censors have quickly deleted them. T-shirts bearing the phrase “Lying down” soon became popular – before disappearing from online shops with similar speed. According to a survey by tech giant Weibo between May 28 and June 3, 61 percent of its sample said they were ready to adopt the “lying-down attitude”.
“Until recently, everybody thought each generation was going to be better off than the last,” said Alex Payette, a sinologist and director of Montreal-based geopolitical consultancy the Cercius Group. “But now we’re seeing the Chinese Dream hit a ceiling.”
In recent months, “lying flat” has given way to a new rallying cry – “let it rot”. Whereas the former was a “call to live simply”, the latter is “a lot more negative and apathetic”, Payette observed. “The idea is that if you’re asked to do something at work, you’ll avoid doing it, and if in the end you have to, you put in as little effort as possible.”
“Let it rot” has become hugely popular over recent months: On Xiaohongshu, China’s answer to Instagram, the original Mandarin term “bailan” got around 2.3 million hits by the end of September. Videos with “let it rot” in the title are currently the most popular on Bilibili, the equivalent to YouTube.
The “let it rot” ethos has even infiltrated the Chinese Communist Party (CCP), Payette noted: “We’ve seen it during floods, for example. CCP cadres would rather wait for an order from the leadership than make urgent decisions – even if this approach risks disastrous consequences. It’s nothing malicious; it’s just a matter of never taking initiative.”
Even more surprisingly, the middle class’s malaise has prompted occasional protests – with demonstrators braving the CCP’s violent repression of any sort of popular contestation. Thousands protested in China’s central Henan province in May and June after four small rural banks failed. Facing ruin, people took to the streets to demand their frozen savings.
Earlier this year, thousands of property developers abruptly stopped construction due to the economic slowdown. Social media lit up with calls for homebuyers to boycott paying the mortgages on the new homes they were waiting for.
‘People don’t want to go backwards’
But as the CCP’s 20th Congress gets under way, Rocca said Xi can feel confident that social discontent will not snowball into political unrest.
“Looking at all these things from ‘lying flat’ to the Henan protests, you can see they’re quite apolitical; they’re all about disengaging from society.”
“The overwhelming majority of the Chinese population – especially those who aren’t members of the party – support the Communist Party,” Rocca went on. “Most people – especially those who lived through the Cultural Revolution and the Tianenmen Square protests – will say it was the party that gave them prosperity. Yes, there is a new ambivalence that’s developed – a certain lassitude in response to changing circumstances – but people still think the CCP is doing a good job of running the country.”
Nevertheless, the middle class’s problems will feature prominently in the CCP Congress, Rocca said: “Experts have now been allowed to criticise certain policies, calling for better financing of health insurance, demanding a fight against inequality and lower property prices,” he said. “That shows there are people in the party who want reforms.”
“People don’t want to go backwards,” Rocca continued. “The party recognises this; it knows that a sense of progress is important for political stability.”
“This issue is going to be a major challenge for Xi’s next term in office,” Payette said. Disillusionment with the status quo and the popularity of the “lying down” mentality “could lead to a drop in the employment rate, especially in sectors like manufacturing”, which would affect the economy overall.
Only a return to robust economic growth can guarantee Beijing’s goal of “common prosperity” and revive the Chinese Dream.
This article was adapted from the original in French.
