laws are used to explain diverse and seemingly unconnected observations. I found myself searching for an underpinning to the Chinese universe, reference points or clues to a larger framework that might help me navigate these foreign waters, something that might reveal how it all fitted together. China’s special logic was elusive and hard to define precisely, but I knew I’d never be satisfied if I didn’t at least make an effort to uncover it.
In the southwest of Beijing there is an area of winding alleyways around Tile Factory Street where, in the fifteenth century, ornate ceramic ornaments were fired in charcoal kilns for the rooftops of the great Ming Dynasty palaces. Three hundred years later, the area around the factory had grown into a cultural centre, where scholars, poets, and artists gathered to exchange ideas and practise calligraphy. Today the narrow streets are lined with shops piled to the roofbeams with books and scrolls; local painters come there to find paper, brushes, ink stones and seals. I often visited the bookshops, with their rickety staircases, dusty display cases, and the burnt, earthy smell of Chinese calligraphy ink. At the back of one of those bookshops, there was a room lined with battered bookcases devoted to Chinese history and ancient theories of war. I had heard about Sunzi, but had never really taken The Art of War too seriously; tales of battle plans from the sixth century BC had seemed too remote to be of much use in the modern age. But I found the shelves there lined with piles of cloth-bound books I had never heard of, like the Book of Qi and the Records of Tan Daoji. I discovered an enormous volume of historical records covering power struggles, plots, and intrigues stretching back well past the time of the European Dark Ages. At first I couldn’t understand the antiquated Chinese language, with its ancient, recondite characters, so I sought out translations, trying to put the Chinese and English together to look for the deeper meaning. I dipped into an old collection of battle plans called the Thirty-six Ruses. There I found set-piece strategies, with strange names like ‘The Beauty Trap’, ‘Take the Wood from Under a Cauldron’, and ‘Kill with Borrowed Knife’. Elsewhere, I found a Han Dynasty strategy that set out the ‘Five Baits for Enticing Foreigners’. I sensed an obliqueness in the approach that contrasted with the direct assault favoured by Westerners. I found more emphasis on timing and surprise, on harnessing external conditions rather than just relying on firepower, and on ways of deceiving a more powerful enemy. There were unexpected twists: in Sunzi’s world, the supreme general avoids war altogether and overcomes without fighting. ‘Overcomes without fighting,’ I thought. ‘What did that mean?’ I bought several of the books and found ideas that helped explain things that had happened at our factories. I was wondering whether they could all be collated into a more coherent pattern when I was suddenly contacted by some investors in Hong Kong.
At the turn of the millennium, as China prepared to join the World Trade Organization, the government realized that the banking system was crippled with uncollectible loans and they decided to do something about it. I found myself tempted by the idea of helping to clear up the mess, so I went to work for one of the big American investment banks that had just entered the new market for ‘distressed debt’ in China.
During the forty years of the planned economy, Chinese banks had given money to factories and work units under the central state plan rather than on the basis of commercial logic. Many of the borrowers had no hope – or even intention – of making repayments. The result was a mess of truly astronomical proportions, with about $700 billion worth of uncollectible debts – known as ‘nonperforming loans’ or ‘distressed debt’ – clogging up the banking system. Faced with the prospect of a complete financial meltdown, the Chinese government started restructuring the banks and selling off tranches of these nonperforming loans to foreign investors at reduced prices. The American bank had bought up several of these portfolios and I was hired to retrieve something from the wreckage.
Over the coming six months, I travelled across China visiting factories that owed amounts under these bad loans, often meeting with the local governments in charge of the area. Many of the loans had been in arrears for years and the relationship between the lender and borrower had broken down completely. Just having a new face to negotiate with often unlocked a knotty situation. At first I felt that the work could bring a lot of benefit to local communities: the factories could be released from their debts for a partial repayment; clearing out the backlog might open up the possibility of new loans; the restructuring assets could make them useful again; and management teams might get an infusion of new talent. But some of the cases were much murkier. I heard that one of the borrowers had been held under house arrest; at another, there’d been riots when a local bank had tried to seize machinery. After a while I became uneasy about the effect of some of the settlements on the local community or the individuals concerned.
During those months, as I worked in the plush offices at the bank during the day and returned to the hutong in the evening, I noticed the city beginning to change, gradually at first. When we moved into the courtyard, even though we were in the midst of an enormous city, we felt somehow connected to nature and aware of the turn of the seasons. In winter, it was so cold that the children sometimes wore coats in bed; by summertime, it was sweltering and flash thunderstorms flooded the courtyard, sending us retreating up the steps to listen to the rain splashing on the clay tiles above our heads. In the local vegetable markets, pots of pickled vegetables or white cabbage lined the stalls throughout the winter, and in the late summer, we’d find cut flowers, lotus root and ginger. But the changes around us gathered pace as the city began to modernize. I’d often notice that an old restaurant had vanished and a mobile phone outlet had appeared in its place, or that a corner shop had been demolished to make way for a wider road.
In the early days I hardly noticed, but the pace became more rapid. Suddenly a long line of shops had gone; then the whole side of a road would disappear. I heard rumours about an old woman in Xicheng District, on the west side of Beijing, who had chained herself to a tree inside her old courtyard as an official read out the eviction order. She’d lived there for sixty years and had nowhere else to go. Grabbing my bicycle, I rode over to see what was going on and found a sea of rubble with the odd solitary tree standing where the old courtyard gardens had been. Window frames and roofbeams lay scattered on the ground; broken saucepans and smashed pots sat among the heaps of shattered tiles.
Once Beijing won the hosting of the 2008 Summer Olympics, there was an inevitability to the fate of the old city. Twenty billion dollars had been set aside to upgrade the capital, and for several years large sections of it vanished behind the perimeter fences of construction sites. Huge areas of the ancient city disappeared forever. Miles of old alleyways and winding backstreets fell beneath the hammer. A hundred thousand workers poured in from the countryside and swarmed over the old buildings, uprooting ancient wisterias from courtyard houses and dumping them on the heaps of broken bricks outside. Ornate doorways were torn away; tiles were pulled from roofs. I sank into a kind of siege mentality and shut my mind to what was happening. All around, the air shook with the roar of bulldozers and I could feel the distant pounding of pile drivers through the ground beneath my feet. I heard that more areas of old hutongs in the north had disappeared, but I couldn’t bear to go and look. All around us, an ancient way of life was dismantled brick by brick.
One day, we came back to find that a character I had seen written inside a circle on hundreds of other courtyard walls was now painted on the wall of our own.
The character means ‘demolish’, ‘strike down’, ‘strip’, or ‘tear apart’. It was the only notice we had that the bulldozers were about to move in. At first I put up a fight; a famous author had owned the courtyard in the 1930s, but of course my argument that the old building should be preserved because of its historical value fell on deaf ears. Then I told them we’d refuse to move out. ‘Wo bu zou le!’ I said. I’m not going anywhere! But the old woman at the Street Committee just shrugged and squinted at me briefly before adjusting her glasses and turning back to her newspapers. ‘Hao ba! Xingqi san ting shui le!’ she said. Okay then! Wednesday the water will stop! So I sat in the courtyard as the workers climbed onto the roofs
