Sub-Prime Comprehension

Interesting cultural details come up when I give my students exams. I had a question about sub-prime mortgages on my biz ethics exam, and the majority of students lost a lot of points.

Why? They defined a sub-prime loan as a loan to "the poors" (i.e., poor people), or to "people who cannot pay it back." In some cases, their description of a sub-prime loan made it sound as if the banks were seeking out bums on the street to give loans to. The answer I was looking for was simply that a sub-prime loan was one given to a person with a relatively low credit rating, but fewer than 1 in 10 got that right.

The reasons for this failure to comprehend were very interesting.

First of all, the American system of credit is quite alien to China. Most people have never heard of a "credit rating" (though a banking insider has told me that they have them). So when you say someone has a "low credit rating," that has no real meaning to my students. Understandably, they unwittingly translate that to "not enough money to pay." Never mind that America has plenty of people who could pay their debts, but choose not to.

Herein lies the second alien concept. China doesn't have much of a credit economy. Almost no one carries a credit card. Even a bill for services is essentially unheard-of in my part of China. The hospital is cash-only, and you pay *before* you get treated. You get loans for two things in this country: a condo, and a car. And the idea that someone would intentionally default on either of those is utterly incomprehensible to most Chinese people.

A car is an enormous status symbol, often possessed as much for bragging rights as for transportation. So if one month you're driving a fancy car, and the next month it's gone, repossessed, you suffer tremendous embarrassment. You would only do that if you suddenly found yourself poor.

A condo is an even more ironclad obligation. In America we call owning your house a key part of the "American Dream." Here it's not a dream, it's a necessity.

As I've mentioned before, social custom dictates that a young man literally cannot get married unless he owns his own condo. No woman worth her salt will think of marrying him. And so, to have a condo and default on the payments is worse than a shame. It would be tantamount to divorce, bankruptcy, and social suicide. No one would do it unless it was absolutely, 100% unavoidable.

With that background, you can see how my students equated sub-prime mortgages that didn't get paid back, with wildly reckless "loans" to bums on the street. Even if they understood the idea of a credit score, the idea that someone with even a modest amount of money would have a low credit rating would enter a Chinese mind like a square peg into a round hole.

If you wonder about the future of the Chinese economy, and especially the housing bubble that many people think exists in this country, one part of the answer lies in my students' inability to understand sub-prime mortgages.

Housing prices will always be sustainably higher relative to personal income in China than they are in the West, because there is so much cultural pressure toward home-ownership. A debt crisis such as hit America in 2008 would happen here only if people's incomes fell dramatically, such that they literally could not pay back their loans. I do think it's possible, or even likely, that this will happen, but it will not happen lightly.

Given that my students seemed to think a sub-prime loan was a loan to someone who literally had no chance of paying it back, my Western mind immediately asked why they wouldn't have asked a question about this seemingly absurd idea. Why would a bank loan money to people it knows can't pay it back?

To be fair, some of my students knew about banks immediately selling the debt upstream, but this really only pushes the question back a step: why would anyone buy obviously bad debt from the banks? I guess in China it wouldn't be unheard-of for a bank to simply lie to upstream purchasers, falsify the loan paperwork, and leave someone else holding their counterfeit loans.

But even more fundamentally, in China one gets accustomed to economic transactions that seem preposterous on their face. It's always someone paying someone else off by accepting a bad deal, or someone moving money from A to B to make B look momentarily better than it really is. It's a political kickback, or stock manipulation, or personal enrichment at the expense of one's company, or whatever. Usually someone — usually the government — sweeps in with some money to prevent the situation from exploding, and the banks and companies stumble forward another day until the next crisis arises or the next bribe is needed. The system has been held together this long, only because of a combination of how universally-accepted it is, and how incredibly crafty the Chinese are at drafting these complicated deals.

Another blog-reader

Today we interviewed a candidate for an Oral English teaching position. (We're still in need for spring semester — qualified candidates please apply!!!)

She gave her teaching demonstration, and we asked her plenty of questions about her background and experience. All well and good. Then at the end, as she was getting ready to leave the room, she asked "Are you, by any chance, Professor-in-Dalian?" I confessed that indeed, I am.

"I love your blog! Oh my god, it's great! It's so funny!" She practically gushed. After her good-byes, she asked me to please "keep up the good work."

When I write the blog, I imagine my friends, FB friends, family members, and perhaps one or two random stragglers happening across it. I'm always surprised to find that I'm slightly famous.

It occurred to me to ask her how she found out about the blog. (It turns out: via a posting on a discussion group she's a member of). Hi, members of that discussion group, whichever one it is! Thanks for the plug!

It didn't occur to me to ask her how she knew it was I. Maybe I've posted a picture or two of myself — such as the one with the garlic hat on my head, from WAY back when — but there haven't been many.

Oh well. I guess I should now expect the paparazzi to be watching wherever I go and whatever I do.

I've been meaning to post this for a couple of days now. China has made a very minor, qualified step back from one especially brutal form of repression, while maintaining much of the reality of the system in quieter, less-well-known forms.

As with most "reforms" in China, there are two entirely opposite possibilities, and the proof will be in the pudding. One is that this is simply a face-saving move to avoid public criticism, but it literally means nothing. The second is that this is a face-saving way to slowly back away from the system, one baby-step at a time. What's so maddening about China is that it's essentially impossible to know which it is, until long after the fact.

Indeed, the reality may be indeterminate at this point. Chinese officials value "flexibility," the ability to change policies instantly without admitting that they're doing so. If things are going well and there's relative stability within the country, perhaps they'll continue to back away from the policy. If they sense a "need" for the old repression, they'll quietly reinstate it under new names — all the while, never repudiating their original policy of closing down the labor camps.

The proof will be in the pudding, and the pudding bakes VERY slowly. Or, if you prefer this metaphor, China is like a giant Schroedinger's Catbox: the reality of today's event will only be determined later, long after the fact.

Incidentally, one of the dissidents says that the ending of the labor camps is vitiated by the fact that it's not accompanied by an official apology or clearing the records of those who were caught up in it. This shows an astounding lack of understanding of her own country, imo. The Chinese government almost never does such a thing. Rather, they simply quietly and behind-the-scenes restore

http://www.washingtonpost.com/world/chinas-labor-camps-close-but-human-rights-groups-say-grim-detention-conditions-linger/2013/12/06/4e84cc96-5bfc-11e3-8d24-31c016b976b2_story.html

Trip to Beijing — Overview

We just got back from Beijing after three wonderful days of vacation with Ma Lei and her folks. I had so much fun watching them! They were like kids, especially Ma Lei's mother. Everywhere we went, she kept saying "Take my picture! Take my picture!" It was as though she couldn't quite believe she was in these famous places, so she wanted a photo as proof. (This is very common among Chinese tourists: foreigners think the Chinese care more about getting a picture of themselves someplace than they do about actually BEING in that place.)

The trip to Beijing was, as far as I know, their first time inside an airport, let alone actually flying. Heck, Ma Lei thinks it was their first time fastening a seat belt. (I had to do Mother's for her on the way to Beijing, because she didn't know how.)

On the way to Beijing it was dark, so they couldn't see much out the windows, but coming into Dalian this morning they had a crystal-clear view. I was reminded of how exciting and strange it was, seeing things from the sky the first few times I flew.

We went to the Forbidden City and Tiananmen Square, and we even stood in line to go see the body of Chairman Mao. (More on that later, of course.) We went to Olympic Park for a bit of more recent Chinese history, and for the first time I sprung for a ticket to go inside one of the venues, the Water Cube. (It was supposed to cost 30 rmb a head, a little less than $5, but we got had by a scalper — again, more later!) We saw the beautiful lake district of north-central Beijing, as well as the fascinating ancient hutong (twisty alleyway) where we were staying.

We did not get to go see the Great Wall, because both days when we could have gone, the wind was too gusty for the cable car up to the top. Ma Lei's mom has a bum leg, so climbing up the stairs is out of the question for her. In fact, she got so tired with all the walking that, every night before she went to bed she said "tomorrow you can go, and I will stay in the hotel." But then, every morning when we were getting ready to go, she couldn't resist.

We ate Beijing-style noodles, which are "meh." Okay, if you like a lot of white-colored starch with a little meat and a hint of green veggies thrown in along the side. We had donkey-meat soup, twice. (It sounds awful to the American ear, but actually it's out-of-this-world good!)

And on our last night, we went to a fancy Peking Duck restaurant that was surely the most expensive meal Ma Lei's parents have ever had. (It came to almost $15 a head, which is really enormously expensive by Chinese standards. And by way of comparison, all taxes are included in the ticket price, and you don't tip — so $15 a head means $15 a head.) The food was phenomenal, and the atmosphere was beautiful.

Last night, I finally got to get a little bit of what *I* love about Beijing: the internationalism of the place.

Ma Lei's parents wanted to buy some packaged Peking Duck to give to some friends and family-members, but the three of them were too exhausted to make the trip down to the district where it's easiest to find it. (They sell it shrink-wrapped in plastic bags, which I find rather gross. Duck-in-a-bag.)

I volunteered to make the trip, partly because I was the only one with any energy left, and partly because it was an excuse to go down to Wangfujing, where there are a couple of mediocre foreign bookstores. Mediocre, indeed, but I quickly spent more than a hundred bucks. Plus found four or five good scholarly books that were over fifty bucks apiece, so rather than buy them in the store perhaps I can find them used on the 'net.

On my way back to our hotel, I stopped at a pub for a good cocktail (very hard to find in Dalian), then I went to one restaurant for a Thai spring roll and another, Spanish-run restaurant for some magnificent hummus and an absinthe cocktail. After all that, I still got home by 10:00.

I'm going to be working overtime for the next ten days to make up for four days away, but I will post more details when I can.

Flying Rubes

It's my contention that we foreigners need to take a huge step back from our condescending attitudes about China, even when there's good reason for those attitudes.

"Oh lord, it's hard to be humble," went the old song lyric, and it's true in China when you come from a culture that produced the automobile — as well as proper traffic control —  the airplane, the computer, the internet, and the handkerchief. (To my friends who think the handkerchief is old-school, just wait till you come to China and see the old men hawk up giant-sized lugies and splat them onto the sidewalk right in front of where you're walking, and ask whether the handkerchief is a technological improvement.) Indeed, it's hard to be humble, when the Chinese frequently act like such third-world rubes.

To me, though, the message of these experiences is how quickly China has advanced. They've gone from Medieval to Modern in half my lifespan, and that should be admired — even as I reserve the right to laugh a little bit at the Medieval remnants that persist.

A couple days ago, Ma Lei's mother gave her a phone call, worried about our upcoming trip to Beijing. They've never flown before, so they don't know how it works, and Mother was concerned that our schedule was too tight. "Are you sure we'll get there early enough to get a seat?" she asked, "And should I bring a little stool in case we have to sit down the aisle?"

You see, on a Chinese long-distance bus or train, there are regulations that say you can't stand in the aisle or sit without a proper seat, but those regulations exist only on paper. Everyone taking a long-distance bus in China (2 hours or more) will either bring along a small fold-out seat or expect the bus operator to have them. A plane is really just a bus with wings, so why not hedge our bets by bringing along little stools?

One of Ma Lei's online friends told her a story, which I don't know the provenance of. It was told to Ma Lei as if it were something that her friend had personally observed, but it could be something she got online. Anyway, I pass it on without swearing that it's the fact...

An old farm-woman got ready to take her first flight. Like someone preparing for his first bullet-train experience, she wanted to get a seat with a view. She saw that there were seats to the right, as she got onto the plane, but then there were these seats off to the left that had the best possible view. So she turned left and plopped down in the captain's seat.

As the story was told to Ma Lei, and then to me, the pilot came in and told the woman she had to leave. But being an elderly Chinese, and expecting people to give up their seats for her, she refused. Who are you, little man, to insist that I give up this super-comfortable chair with the great view out the front window?

Again, I can't swear it's all true. But as told to me the pilot whopped her a few good ones on the head, then she realized she was in the wrong place. She finally got up and allowed herself to be guided back to her proper seat.

I hope that story isn't actually true, but it could be. It's not impossible that a Chinese nongcunren — a rube — would be so ignorant of the norms of air travel. After all, the standards that apply to their train travel are completely different from the way one has to behave when flying. It's fine to laugh at her, but let's not forget what fish out of water we would be if we had to survive in Chinese farm country for a while.

In a way, hats off to China. They've got a population which is still majority-underclass, yet they're developing an infrastructure of modernity. The mere fact that my wife's family — brutalized during the Mao era — impoverished and reduced to subsistence farming — with close cousins who died of starvation while I was a well-fed boy in America — could now be flying to Beijing... That's pretty cool.

Self-Obsolescence, Chinese Style

I got a call a week or so ago from a Chinese administrator in my department, asking if I would be willing to join my good friend Jim in teaching an oral English class to Chinese teachers from all across the university, not just my department. The job pays a fair bit of money (about $100 a week for three teaching hours, not bad for China — though not at the top of the scale).

A little more information has come in since Jim and I agreed to teach the class. As it turns out, the university wants to train its Chinese subject faculty (i.e., those who teach accounting, management, finance, and subjects) to teach bilingually.

When we learned about this, both Jim's and my alarm bells went "Ding-Ding-Ding." Spidey sense is tingling, big-time!

Here's the scoop: Our university wants to provide some form of international education, but foreign faculty are at least three times as expensive as Chinese faculty. A foreign Lecturer might be paid $2K a month; a foreign Assistant Professor, $3K and up. A Chinese Assistant Professor might be paid $800 and think she's just won the lottery. Even if the Chinese has a PhD from the same university in America where I got mine, he or she will be paid as a Chinese.

So to put that in the starkest of terms: I cost my university between four and eight times what an equally-educated and equally-qualified Chinese-born person would cost.

Can you blame the university for wanting more bilingual Chinese teaching their classes?!

So here I am, the foreign teacher, being asked to sign on for $100 a week in order to train-up the very people who would kick me to the curb if they could. I am training my own replacements. I am hundred-dollar-a-week executioner. I am a mercenary killing my own. I am Uncle Tom.

Jim isn't in quite as absurd a position as I am, because he is an English teacher. The people we're training are professors of business and related fields, hence my direct competitors, not his.

But you know, I am for capitalism. I am for competition. I am okay with people looking for the best for themselves, and I don't mind losing out if someone else can do the same work for less money. If I lose, I lose.

Don't cry for me, Argentina. It's not actually as bad as that.

I teach really well, better than most Chinese faculty, and my students appreciate it. So do the administrators.

Furthermore, I've got a pretty high-quality PhD, so I provide my department a lot of "face." I look good on their press-releases.

I'm also infinitely team-spirited, so I've built (I think) important friendships within the department by helping out when help was needed. I don't complain and I don't demand and I don't make trouble, so I'm pretty sure I'm valued.

My students love me and sing my praises to the administration — so I hear consistently through Ma Lei's Chinese spy network of friends in the administrative staff.

And of course, if the university in one swipe threw out all foreign faculty including those with impressive foreign PhDs, I could always go out to the outskirts of Dalian where there aren't very many foreigners. I could teach classes for children twenty hours a week and make two or three times my university salary.

Nevertheless, I fear that things overall are tightening for foreigners in China.

In a country that's not known for its love of outsiders or trust for those countries that invaded it and picked it to pieces 150-ish years ago, there are plenty of people in positions of power who would happily flick the whole lot of us off their back as a dog shakes off its bathwater. Gone, for sure, are the days when one could hop a plane over here with nothing more than an American passport and a clean criminal record and make a good living teaching English or other subjects. Make no mistake about it: China would like to get rid of us all and replace us with its own citizens.

Infantry Teaching

I had a fantastic day of teaching today, in my two classes for little kids out in the outskirts of town.

Chinese kids are kids just like anyone else, but they're so used to being squeezed into a little box. "Listen to this." "Repeat after me." "Don't move in your chair." "Learn the words — don't worry about the concepts."

Today I started with a very simple little game. Students were divided into two teams. I gave out little paired cards with vocabulary words written on them, so one student on each team might have the word "dangerous" or "broccoli" or "pilot." I gave the students a couple of minutes to think of a sentence that used their words.

Then I called out a word, and the two students who had been given that word had to run to the board and write their sentences. Whoever finished writing first automatically got one point. Whoever had a grammatically correct sentence got one point for that. Whoever had an interesting sentence got one point, even if it wasn't grammatically correct. So a student could theoretically get three points for one sentence, though realistically someone was almost always going to steal the swiftness point by writing "knife is dangerous" or some other ungrammatical sentence. But "I like tiger because it dangerous" would also get a point for being interesting. Predictably, there were a whole lot more quickness points than interestingness points given, but that's okay. That's how kids are: like water, they seek the path of least resistance.

You wouldn't believe how well this little game worked. They got to run. The kids got to shout and laugh and be mad and happy at each other. They got to be competitive (which the Chinese are, like no other people I know). They got tired, so that afterwards the little boys were almost as capable as the little girls of sitting still and doing the required boring pronunciation drills.

And here's the really fun thing: the Chinese teacher who set up this class for me was just as captivated, even though it totally cut against her own grain.

She's the type to berate her students in the harshest of voices, to physically restrain a boy who's rocking in his chair when he needs to move, and even to smack a student for the crime of being a kid. Nevertheless, she howled with laughter at their antics during the game, she loved watching them get so engrossed in it — and she strongly suggested that we play the same game every week. She responded to this little game as if it were a gift from a beautiful alien universe.

I don't want to play the exact same game every week. I want to come up with new ones that will keep them off-guard and guessing, and raise new sparks of excitement each time. But I'm glad that the kids had a great time, and their Chinese teacher had fun too.

And the Mommy phalanx that lines the walls of the classroom were also laughing like kids. Some of them whose presence in my classroom in the past has consisted of nothing but scolding and smacking their kids, were shouting like cheerleaders when their little ones ran to the board. The game made them and their kids into allies, rather than enemies, which is the more typical Chinese parenting model. (I must confess, after the game ended I witnessed one mother scolding her boy for doing badly. I felt really bad for that, because it was the game I introduced to them that enticed that woman to dress down a kid who's just trying to do his best. We Americans think we've seen helicopter parenting, but we ain't seen nothin' compared to China.)

Notwithstanding some bad behavior by parents, the game was a huge success. It got the students involved, everyone loved it, and the students learned new stuff. Yet it would never have happened in a Chinese classroom.

What is it about China? I don't understand. They default to this dogmatic, authoritarian, Teacher-is-God approach; they consider it normal to either beat their children or spoil them with candy while the children sit passively; yet when they see someone doing things in the most un-Chinese way, the parents are enthralled.

This is what leads to such massive cognitive dissonance in China. If I felt that what I was doing were completely alien, foreign, and unwelcome, then I would just shut up and do what I was told, or else go home to America. But the Chinese seem in so many cases almost furtively to wish they were something other than they are. On the other hand, they're quick to flip back into Chinese mode, and will fire you in a heartbeat for doing the same thing they loved a moment before.

Those Chinese people are like a repressed Midwesterner who moves to Los Angeles. They would like to be free and open, but they've had the opposite approach so drilled in them that it's as if it were in their DNA.

This week and last, the weaker of my two little-kid classes has been talking about food. Their stupid textbook contains a bunch of words that cannot possibly have any meaning to them, yet they're expected to use them like parrots. "Potato salad" features heavily in the dialogue they're reciting blindly, despite the fact that it doesn't exist in China. They struggled with the word "tortilla," the inclusion of which in our textbook should be grounds for the textbook editor to be shot. (For one thing, it's not English, it's Spanish. For another, it includes the "ll" = "y" which doesn't occur in English except in borrowed Spanish words. Kids this young shouldn't be burdened with such obscurity.)

Next week, I will bring that class a giant batch of potato salad, as well as a package of proper Mexican wheat tortillas and something (I haven't decided what) to wrap in the tortillas. I may also somehow include "pickles," which the idiot textbook editor decided to incorporate into the text despite its having a very different meaning in China.

(There are pickled vegetables here, but they're almost never the pickled cucumbers we know in America, and they're served in completely different contexts. So to just throw that word in there as if it were something easy to understand or translate — well, you'd have to be an American university professor to do something that culturally ignorant.)

All that to the side, I want to give the students some sensory data to connect to the words they're learning, so that they can go beyond the parrot level and perhaps actually gain some understanding. I would like them to slow down, back it up a bit, and learn some concepts, not just empty words.

The really fun thing about all this is that it's bringing the real teacher out in me. As a "professor," one can potentially disappear up into the ether and let the students follow or not as they choose. But as a teacher like this, I'm right down in their context of knowledge. If they get it, they get it. If they don't, it's all on me. The Chinese parents and teachers may love it, but they can't do it. Only the guy who was raised speaking English can bring those expressions and those cultural experiences to them. Only a guy with some Western ideas about education can break them out of their Chinese mode. And who knows? It could really change these kids' thinking methods for the better.

What I was trained for in grad school in America was like artillery teaching: lob information out there, and hope it hits students somehow or other. That's what a "Professor" does. What I'm doing in these classes for little kids is infantry teaching: close engagement, sometimes hand-to-hand, and it's on me to make sure they get it. It's exhilarating! And interestingly enough, it's also making me a better Professor in my university classes.