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Shanghai Daze : Forget Those Dour Mao Suits and Collective Farms. In the Capitalist Frenzy That’s Hit One of the World’s Largest Cities, the Army in the Disco Business, the Secret Police Are Running Brothels, and Profit Is All That Counts.

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This past February, when Shanghai International Securities, China’s largest brokerage house, suddenly found itself staring at losses of upward to $150 million in the bond futures market, it wrote a new chapter in the history of this mutant people’s republic by trying to manipulate the market with a mass selloff minutes before closing time. The next morning, stunned officials on Shanghai’s infant securities exchange were forced into another unprecedented move. They canceled the $37 billion in sell orders and suspended all bond futures trading until they could investigate.

For those who still associate China with Mao suits and communes, the fact that Shanghai now has financial markets and is generating its own Milkens, Boeskys and Neesons may take some getting used to. But for Shanghai’s new generation of wheelers and dealers, for whom stock market quotes rather than the quotes of Mao Tse-tung are gospel, such occurrences as February’s scandal have become everyday matters.

In fact, to many Shanghainese it seemed like just another coming-of-age milestone when, after losing 540,000 yuan ($62,000) playing the volatile market--which lost almost half its value in two months last summer, only to triple its value during the next month--a 37-year-old former textile worker flung himself off a high-rise building. Then his wife sued her husband’s broker, becoming the first Chinese to file for legal damages on the grounds that a securities firm had broken the law by permitting an employee to go too far out on margin.

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Like much of the rest of the country, Shanghai has a way of amazing even old China hands these days. What is one to say about a Marxist-Leninist “democratic dictatorship of the proletariat” in which Estee Lauder lipstick giveaways create street riots? How does one interpret the Communist Party’s historic dedication to class struggle when it allows state-run television to run DeBeers diamond commercials (“Your friend forever”) and state-owned newspapers like the Shanghai Star to tout the grand opening of a Steffano Ricci shop (selling $2,000 crocodile-skin shoes and hand-stitched suits) with the headline: “Italian Sartorial Dandy Swaggers Into City”?

What’s happening in Shanghai is unparalleled in its history. One of the world’s largest cities is being reborn from socialist torpor to become a capitalist boom town. During the first two months of this year, usually an economically slow period, this “dragon head of the Yangtze River Valley” grew by almost 13%; industrial production went up more than 17%; retail sales rose more than 28%, with sales of items such as air conditioners and video cameras jumping by more than 200%, and local exports rose well over 30%. At the same time, 381 new foreign-funded joint ventures came on line so that Shanghai now has more than 10,000 such businesses. Fueling this boom was a 26% rise (to $10 billion) in foreign investment last year. But, alas, this economic boom has yet to be paralleled by a renaissance of either politics, ethics or culture.

For anyone who first came to know Shanghai when it still prided itself on being the birthplace of the Chinese Communist Party and Mao’s Cultural Revolution, the unalloyed commercial energy that currently crackles through its once gloomy, traffic-free streets forces one to abandon all notions about enduring identity.

Like China, Shanghai has canceled its identity so many times during the past century that it is hard to know what it finally stands for, much less where it is headed. Shanghai’s heyday as the financial and cultural capital of Asia was ended by Japanese occupation in the ‘30s; its postwar era of Western Confucian syncretism under Chiang Kai-shek was aborted by Communist revolution in the ‘50s, and the Mao era was buried under an avalanche of capitalist-style reforms in the ‘80s and ‘90s.

It is this sense that almost everything is renegotiable that gives Shanghai such a feeling of excitement and uncertainty, but since there are fortunes to be made, few now care to dwell on Shanghai’s curious penchant for reinventing itself every few decades. Yet surveying this history, one can be forgiven for wondering how long this city’s current incarnation will last. As one Chinese friend put it, “The city’s only common chord with its Maoist past is its penchant for extremism. Instead of politics, we have now put business in command, and with an equal if opposite totalism.”

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“Dense, rank, richly clotted life. . . Nothing more intensely living can be imagined,” Aldous Huxley wrote after visiting Shanghai in the ‘20s. “The spectacle of it inspires something like terror.” Indeed, the city’s prodigious energy still inspires a kind of terror. On a recent trip, as I gaze in wonder out over a blinking model of the city’s vast Pudong New Area and its 75 futuristic skyscrapers, a sophisticated Dutch financier leans over and whispers in my ear, “It’s a little frightening, don’t you think?”

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In the 1920s, when about 60,000 foreigners lived in the city’s “international concessions,” protected by Western courts and police allied with underworld bosses, Shanghai was almost an independent city state--a swirling vortex of freewheeling finance, trade, crime, dissident politics and bohemian culture.

“Beneath a million brilliant lights the cabarets and gambling houses, the theaters, teahouses, dance halls, and sing-song places were jammed with customers,” Ernest O. Hauser wrote in his ‘30s classic, “Shanghai: City for Sale.” “The immorality practiced in Shanghai was unique in the world. Somehow, it went with the atmosphere of the place, with its bold individualism and greed.”

When American journalist Edgar Snow arrived in 1928, he found the city a “vast, unkempt, exciting, primitive and sophisticated” place peopled by every conceivable nationality and kind of person: “plump virgins procured for wealthy merchants,” “scrubbed, aloof young Englishmen in their Austins popping off to cricket on the Race Course,” “Herculean bare-backed coolies” and “Russian mistresses out for cool air along the Bund,” that stretch of grand, old turn-of-the-century European-style banks, foreign clubs and corporate headquarters that fronted the Huangpu River and radiated what Hauser described as “a triumphant air of profit” and “bland arrogance.”

By the time I first arrived in 1975, the only evidence of this “Paris of the East” was a host of shabby, desiccated European-style buildings expropriated from their imperialist and capitalist owners by the Communists after “liberation” in 1949. The British-run Shanghai Club that once boasted “the longest bar in Asia” had become the seedy East Wind Hotel; the magisterial Hong Kong-Shanghai Banking Corp., which had been the financial arm of the British government in China, was occupied by the Shanghai People’s Government and the Municipal Communist Party Branch; the copper-roofed Sassoon House had been transformed into the Peace Hotel, and the Maritime Customs Service’s “Big Ben” clock tower with its British-cast bells had been retrofitted with huge speakers programmed to blast “The East Is Red” over surrounding rooftops. Walking among these phantasms from the past left one with the feeling of having wandered into a time warp.

Now, the mantras of the hour are about profit margin, cash flow and the bottom line, not class struggle, self-reliance and a pure ideological stand. The pride of new Shanghai is not “People’s Square,” but the vast Pudong New Area, the multibillion-dollar development zone rising across the Huangpu River opposite the Bund. Connected to the old city by a network of bridges, thruways, tunnels and subways, it is the most ambitious experiment in instant urban redevelopment the world has ever seen.

Pudong did not really begin to take off until patriarch Deng Xiaoping visited Shanghai in 1992 and confessed that one of his “biggest mistakes” was to have failed to designate Shanghai one of the Special Economic Zones (such as Shenzhen across the border from Hong Kong) set up to help develop coastal China in the early ‘80s. “Although Pudong was developed later than Shenzhen,” Deng said, “I believe it can even surpass Shenzhen.” This was music to the ears of local boosters, who yearned to see Shanghai overtake Hong Kong and reassume its place as the financial capital of China. Today, one can drive for hours through a seemingly endless expanse of high-rise buildings emerging from what was only recently farmland.

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Short of war, there is probably no urban area that has changed so rapidly this century as Shanghai has during the past four years. In the city proper there is so much demolition that whole sections look as if they have been carpet-bombed. Indeed, a visitor would have a hard time telling whether Shanghai is being destroyed or rebuilt. Since 1992, the municipal government has put approximately 600 parcels of land, each one roughly as large as a New York City block, on the market. So urgently are contractors striving to complete construction projects, that at night work continues under powerful halogen lights, which create enormous smudges of eerie illumination against the penumbra of air pollution that usually envelops the city.

Nearly every government organization is trying to parlay its land, buildings and expertise into profit. Even the overlords of the Bund’s stately foreign-built edifices have been scheming. Last May Day, while crimson banners proclaiming “Long Live Marxism, Leninism, Mao Tse-tung Thought” draped down the old Hong Kong-Shanghai Banking Corp. headquarters, officials were announcing plans to turn the Bund back into “China’s Wall Street” by auctioning off 37 of its most venerable buildings. No one seemed to note the supreme irony that some of the bidders were the very companies from which these properties had been expropriated almost a half a century before.

One building that has so far been spared is the Pujiang Hotel, formerly the elegant Astor House Hotel (“tea dances and classical concerts are popular,” one ‘30s guidebook boasted), which stands just across the Garden Bridge from the Bund. Its temporary salvation came in 1990, when its by-then shabby ballroom was reborn as the Shanghai Securities Exchange, which quickly became the epicenter of a new moneyed class of dahu (big players), whose appearance fueled Shanghai’s dream machine with visions of instant riches.

Yu Rong, manager of the Saige International Trust and Investment Corp., is one of Shanghai’s financial whiz kids. Little concerned with politics and less with revolution, Yu drives a new Lexus and enjoys playing video games and dining out with his wife, who works at the exchange itself. His office is in a restored castle-like structure that was headquarters for the commanding officer of British troops posted to Shanghai’s International Settlement. As Yu gives me a tour of its wood-paneled and chandeliered rooms, he explains that most are now assigned to millionaire dahu so they can play the market in privacy and comfort.

Almost everywhere in Deng’s China, class distinctions based on wealth have been resurfacing. The stylishness of one’s clothing, the model of one’s car, the building in which one works and how often one travels abroad have all helped establish the post-Mao society’s new pecking order. So it is hardly surprising that the deference with which clients are treated at brokerage houses like Saige depends on the size of their investment. A 10-million yuan ($1.2 million) account certifies a client as a chao dahu (super big player) and warrants a private office on the third floor, complete with air-conditioning, leather-like couches, a private computer terminal, multiple phone lines and complimentary snacks. As accounts decrease, however, the size of courtesy rooms and other privileges shrinks until small-time investors find themselves relegated to a cheerless downstairs hall with nothing but a large electronic quotations board hanging from the ceiling and several trading windows along the walls.

“Most of our big dahu were professors who studied and taught finance,” Yu tells me. “In fact, during one recent month alone, 64 of the best faculty members left the University of Economics and Finance to manage their own investments.” When I ask who remains to teach the upcoming generation, Yu shrugs indifferently.

Now that the Shanghai Securities Exchange lists 212 different shares, has a daily turnover of about 4.1 billion Y ($500 million) and boasts 550 members all looking to open new offices, no building is too sacred for reconsecration into the marketplace. Saige leases its office from the cash-starved Yan’an Middle School. And taking ecumenicalism to a new extreme, the government-run Religious Affairs Bureau has leased out the blue, onion-domed Russian Orthodox Mission Church to the New Happiness Securities Business Bureau, with the upstairs rented by St. Peter’s Disco.

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State-run department stores and shops on Shanghai’s renowned Nanjing East and Huaihai roads are also being reborn. Whereas once their dimly lighted windows displayed machinery parts, pug-nosed Mao caps and the works of socialist big leaders, now they feature svelte women’s gowns, men’s tuxedos and the latest in silk lingerie. The streets draw millions of people each day, many from that new stratum of society in which shopping has become a major form of leisure. Everywhere, fashionable young women with shopping bags strut the streets, their faces made up impeccably, making the days when the only cosmetics available were such local products as Nazi Face Whiten Cream seem as remote as the Han Dynasty.

Shanghai no longer goes into hibernation as soon as darkness falls. As the list of permissible pleasures grows, Chinese have rushed to embrace them. One of the most popular and widespread forms of self-indulgence is eating out. The lights of thousands of private eateries blaze deep into the night, in contrast to the days when the city offered nothing but a few dreary state-run restaurants that shut promptly at 7 p.m. With tens of thousands of foreign ex-pats arriving to do business, a second wave of trendy Western-style watering holes has also started mushrooming. And then there is the new crop of nightclubs, such as the Shanghai Nights Paris Club in the new Japanese-backed Isetan International Shopping Centre.

The decor of this cavernous music hall defies categorization. The pantheon of larger-than-life white plaster reproductions of Greek gods and goddesses (all the rage in Shanghai) flanking the stage clashes with the Chinese lanterns hanging along the back wall. Muddying the cultural ambience even further is a stage backdrop of a boat that looks like a cross between a Mississippi River paddle-wheel steamer and a Parisian bateau mouche.

On the night I visit, the club’s main drawing card is not its decor, however, but its three Ukrainian dancers, the first nightclub act in Shanghai to feature European dancing girls since the halcyon days of the ‘20s. At that time, a mass exodus of White Russians fleeing the Bolshevik Revolution--whom one breathless observer of the time described as “lush, snow-white creatures”--filled dance halls and “sent the temperature of Shanghai’s night life soaring.” With the collapse of the U.S.S.R., young Russians are again flooding Chinese cities as waitresses, dancers, taxi girls and prostitutes.

When the dancing troika of Slavic femininity finally bursts onto the stage, all attention locks on them in anticipation of something exotic. A dahu at the next table with a cellular phone holstered at his side and a gold Rolex watch displayed conspicuously on his wrist gazes up with rapt expectation as the dancers--hardly the delicate physical specimens of bygone times--launch into a soft-shoe routine. But when they fail to reveal so much as a hint of flesh, disappointment sweeps the room. By the time the Ukrainians are halfway through this first lackluster number, the dahu is not even looking at the stage.

The club partly redeems itself in terms of prurient appeal when eight Shanghainese mannequins from Jenny’s Fashion Model Agency appear and, under the guise of giving a fashion show, begin strutting and undulating in a variety of bizarre garb. To Gregorian chant set to a rock beat, they do a number that incongruously incorporates enough pelvic thrusts to get the dahu to register a flicker of interest. But he doesn’t come completely back to life until a Hong Kong Canto-pop tune begins reverberating through the hall and the girls sashay forth in skimpy red bikini outfits adorned with sequins and furry fringes, accessorized with long diaphanous capes and pillbox hats.

For those of us who had come Sinologically of age watching all-accordion orchestras accompany choruses of rosy-cheeked People’s Liberation Army soldiers on such anthems as “Ah! Chairman Mao, How the People From the Grasslands Long to Behold You!” the hoochie-coochie quality of this “fashion show” takes a little getting used to. But far more shocking than even the small quotient of bare flesh revealed is the revelation that the Shanghai Night Paris Club’s productions are the progeny not of a Chinese Wayne Newton, but of the Shanghai Bureau of Culture, in business with an investor from Hong Kong. What’s more, further inquiry reveals that Jenny’s Fashion Model Agency is providing just one of many strings of young women who troop around the city giving such nightclub shows--all of them, it turns out, licensed by the municipal government’s Social Culture Management Bureau, which rakes off 10% of the night’s take.

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Most government officials are so busy xiahai- ing (“jumping into the ocean of commerce”) that not even the Bureau of Culture has much time for serious culture. Profit is all that most government organizations can think of these days, a quest that has created some pretty bizarre bedfellows. The building housing J.J.’s Disco, one of Shanghai’s most degenerate and popular nightspots (but temporarily closed for “fire code violations”), where an American deejay spins platters for a jampacked crowd of youths enjoying a frenzy of drinking, dancing and trolling for sex, is owned by the PLA’s Nanjing Military District. And the Moon Club, a high-class bordello on Zhaojiabang Road that caters to officials and wealthy overseas Chinese businessmen, is controlled by the Public Security Bureau, giving new relevance to the age-old saying jingfei yijia (“police and bandits come from the same family”).

In terms of the recrudescence of night life, corruption and avarice, Shanghai seems to be trying to return to its pre-revolutionary roots, when police thought nothing of working with gangland bosses to control crime and political dissidence. In those days, as many as 100,000 prostitutes were working in Shanghai. Now a new generation of bar girls is streaming into the city to capitalize on Shanghai’s revived sex trade.

One of the most blatant venues of sex-for-sale is the Rainbow Hotel near Hongqiao Airport. Although the hotel is run by the Shanghai Tourist Bureau, it is reportedly owned by the PLA. By 10 p.m., the Casablanca club on the 30th floor comes alive with young prostitutes whose hard, vapid looks contrast harshly with the roseate, smiling faces of socialist maidens that used to adorn propaganda posters. Their preferred clients are wealthy male “compatriots” from Hong Kong, Taiwan and Singapore or businessmen from Japan.

I watch one night as 10 or so Japanese men enter behind a guide like schoolchildren on a class trip. Their appearance immediately causes the flocks of waiting girls to break off their conversations in mid-sentence and streak toward these incoming targets like heat-seeking missiles.

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The combination of their deprived socialist past, the seductions of the current boom, a yearning to consume and deep uncertainties about the future has helped create a runaway syndrome of carpe diem in Shanghai. What most young Shanghainese think about now is not selfless, revolutionary nation building, but of grabbing what they can and enjoying themselves before it is too late. This mood has been augmented by the unspoken threat of a post-Deng era succession struggle. Although congeries of officials (party chief and President Jiang Zemin, Vice Premier Zhu Rongji and Politburo member Huang Ju) are former Shanghai mayors, who knows how long this bubble of giddy development and prosperity will last?

Even Xie Jin, a film director whose career has stretched from the ‘40s to the ‘90s, has joined the entrepreneurial scramble. Not only has he recently inked an agreement with a Guangdong Province business magnate, Yango Bo, to set up the Xie Jin-Hengtong Film & Television Co. Ltd., but he has also opened his own “movie star school.” When we meet, the director, who is well into his 70s, is dressed in traditional Chinese style, cotton-soled cloth shoes, blue jeans and a herringbone tweed jacket, a collision of sartorial effects that perfectly limned the conflicting worlds of past and present and East and West that he is trying to embrace.

As we sip green tea, Xie acknowledges that culture is not developing as fast as the economy. “Few quality films are made domestically because the market doesn’t support them,” he says. He does not mention that party censors have also consistently impeded the production of any film they consider to be politically sensitive, forcing serious directors such as Chen Kaige, Tian Zhuangzhuang and Zhang Yimou to look abroad for both financing and distribution.

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It was the absence of such independent financing for film projects within China that inspired Xie to ally himself with the Hengtong Investment Co. Ltd. to form his film and TV production company. As more Chinese watch TV, as VCRs become commonplace and new broadcast frequencies and cable channels are approved, there is a growing demand for new programming. “Some big businessmen like Yang are beginning to support projects such as ours,” Xie says exuberantly, “because they believe that Chinese film production will soon be just like in Hollywood--with private companies responsible for their own scripts, stars and profits.”

A key link in Xie’s grandiose plans for a Hollywood-ization of Shanghai is the Xie Jin-Heng Tong Movie Star Academy, where for 8,000 yuan ($1,000) in yearly tuition, aspiring film stars can take a quickie curriculum of acting, vocal music, movement and ballet.

Approaching the school, the first thing a visitor sees is a massive stone statue of Marx and Lenin inside the front gate. It is one of the many anomalies of Deng’s “New China” that a training center for budding movie stars is in the compound of Shanghai’s Chinese Communist Party School. This once improbable marriage between the party’s old political apparatus and China’s nascent entertainment industry perfectly symbolizes the contradictory way in which this putative “people’s republic” is transforming into . . . Well, it is sometimes hard to know exactly what.

By linking the school to a company, Xie has created a vertical structure in which new talent can be cultivated and then fed into his own productions. Upon being admitted, each student must sign a contract agreeing to pay 30% of all film income to the company for three years after graduation. In fact, Xie recently announced that he would direct several new films: a $10-million epic about the Opium Wars (“one the biggest budgets ever in China,” he brags) and a film called “Valley of the Girls,” an ouevre of questionable origin that is to feature eight of his school’s recent female graduates playing “women prisoners.”

While Xie Jin’s reputation as an established director and his willingness to avoid antagonizing the party have allowed him entry into Shanghai’s new commercial world, there are many more artists and intellectuals whose views and outspokenness have relegated them to the fringe. Unlike old Shanghai, however, the city offers no networks of galleries at which unconventional art can be shown, few publishers willing to put out serious contemporary writing and fewer theaters where experimental drama can be staged--much less cafes, teahouse or after-hours joints where like-minded bohemians can hang out and share ideas.

Thus it was a path-breaking event when, in late March of 1994, about 35 of Shanghai’s best-known fringe cognoscenti got together to see the work of contemporary painter Zhang Long in an apartment rented to an ex-pat. The informal ambience among the artists, writers, pop musicians and critics who milled around represented the polar opposite of the world inhabited by businessmen like Yu Rong and Xie Jin’s partner Yang Bo. Because of Zhang’s free-form lifestyle and enigmatic work, he had been expelled from art school and imprisoned for two years in a reform-through-labor camp in the late 1980s. Not surprisingly, his paintings are filled with images of crowded rooms gridded with bar-like lines through which ghostly faces grin out absurdly.

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Like almost everyone else in the room, Zhang was without an official danwei (“work unit”) and thus was without a regular salary, health care, housing or other welfare benefits. While he had sold some paintings abroad, he had found no buyers within China and thus lived hand-to-mouth. Nevertheless, he was enjoying the party because, as he told me, “it may be hard for a Westerner to understand, but just to be able to get together and to talk with other artists is a great relief.”

None of the ragtag group of proto-bohemians at the party had any illusions about their own cultural or political significance. While the marketplace boom allows them more room to breathe, it also makes them feel more isolated and irrelevant. As long as Shanghai’s cultural avant-garde remain politically irrelevant, they will probably not be actively persecuted. However, whenever they dare to speak out on important political issues such as the need for human rights and greater pluralism in the political process, they are quickly arrested. As Deng Xiaoping has tirelessly emphasized, political stability must be maintained at all costs. His reform strategy has been to save the Communist Party with capitalism, not democracy.

Many people’s standards of living have risen substantially, and their new middle-class status has done much to still the kind of disaffection that has animated dissidents in the past, but there are large groups of people who have been shut out of the economic boom or whose position in it remains precarious. Workers in Shanghai’s state-owned enterprises, for instance, earn no more than 300-400 yuan ($40-$50) a month, and their meager buying power was reduced further by inflation that ran 24% last year, with some cities hitting 30%.

To leave the glitz of Nanjing or Huaihai Road for Shanghai’s run-down, obsolete and poorly organized state factories is to re-enter China’s past, where buildings have fallen apart from age and obsolete production lines have been halted because nobody wants to buy their inferior goods. Here the future of workers does not look so rosy.

However, because independent labor unions are illegal and those foolhardy enough to try to organize outside of the official All-China Federation of Labor Unions are immediately arrested, workers have few ways of expressing grievances except to engage in spontaneous work stoppages. Last year, more than 10,000 wildcat strikes were reported. Some of the worst broke out in the Manchurian cities of Harbin and Qiqihar, where tens of thousands of mine workers took to the streets, presenting officials with the terrifying specter of restive proletarians aided by disenchanted intellectuals galvanized against unilateral party rule.

Another great block of society that lives on the edge is China’s 100-million-strong liudong renkou (“floating population”), of which Shanghai alone claims about 3 million. Although these rural migrants have fueled China’s boom by providing an inexhaustible supply of cheap labor and often do make more money working construction jobs or doing piece work in coastal cities than in their grindingly poor home villages, it would not take much of an economic downtown to put millions out of work. Even now, one sees numerous beggars jingling cups as their ragamuffin children tug at the cuffs of passersby for alms.

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Despite these problems, both the reality and the illusion of prosperity continue to provide powerful fantasies of upward mobility. With so many tall buildings, luxurious five-star hotels, glittering nightclubs, expensive boutiques, gleaming foreign cars and fashion-conscious people, it is tempting to imagine that Shanghai is not only economically booming but also regaining its legendary past as a city of high finance and political and cultural sophistication.

Such a conclusion is all the more tempting when one runs into someone like Zhou Xiaoyan, who is of that earlier generation of cosmopolitan Chinese whose lives embraced a synthesis of East and West. At 78, she is still spry and vigorously continuing her first love: teaching voice.

To enter the apartment where she lives with her film director husband is to be in a world that seems as out of place in Shanghai as the old Art Deco buildings along the Bund. A piano is heaped with scores of music, and shelves are stacked with books. She fixes coffee, then in a combination of Chinese, French and English, she recounts how she grew up in a wealthy banking family in Wuhan, where she attended an Italian Catholic school.

“China desperately needed talented people, and since I wanted to help save our country, I thought that I’d better really learn something,” she explains with a mixture of defiance and wistfulness. “In 1940, my father sent me to study music in Paris at the Conservatoire Russe, and then the Nazis marched into France.” Unable to return home, she made the best of her confinement. A photo album shows her performing in recital halls and studying with such European musical luminaries as composer Alexander Tcherepnin, violinist Yehudi Menuhin and the legendary Nadia Boulanger.

In 1947, Zhou left Paris for home. When Mao’s troops marched into Shanghai two years later, she and her family were so filled with idealism that they steadfastly refused to heed those who warned them to leave China. Family photos show her earnestly singing for shipyard workers and standing with Premier Chou En-lai, smiling with youthful optimism. But for the next 15 years, there are no photos. This was the Cultural Revolution, when her family was plunged into a maelstrom of political persecution. The worst thing about those years was not her own suffering, she says, but that “they destroyed education and culture for the next generation.”

Now Zhou is back, struggling to teach opera to this new generation at the Shanghai Conservatory of Music. Rather than lament the way serious music is being swamped by pop culture, she busies herself with her students and an opera center established in her name.

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“The point is, if we as a people lack knowledge and culture, we will not be able to do anything--we will be ignorant, not alive and will not even be able to make this city really advance,” she says with a sigh. Unfortunately, her struggle is rarely easy. In what seemed like an emblem for what was happening to Shanghai as a whole, the conservatory recently sold the land rights to her voice studio, which she’d just renovated.

When I learn that the French Consulate had brought the lyric soprano Nicole Monestier to Shanghai under Zhou’s aegis, I attend one of her recitals. As a small audience waits at the conservatory in one of those Communist-style “reception halls” whose oversized stuffed chairs are draped with lace antimacassars, I can hear the sounds of the city building outside. Nonetheless, when Monestier appears in a long black gown with her tuxedo-clad accompanist and begins a soft Lully song, she creates a feeling of artistic sanctuary in the room. Just as she is finishing, however, a sledgehammer begins a rhythmic bass-like pounding somewhere outside. Then in the middle of a moody Brahms song, yet another hammer joins in, this one making a descant soprano pinging sound as if someone were beating on a pipe. Monestier’s brow furrows, but she gamely sings on.

By the time she comes to her last song, the ensemble of proletarian percussionists has been joined by a counterpoint of yelling just outside the window, making the whole cacophony sound almost like an avant-garde musical work. No one would have been surprised if a phalanx of workers in hard hats suddenly burst through the floor in front of the piano, and with picks and sledges raised in socialist defiance, shouted down the recital.

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The truth is that despite its economic vigor, and even the new opera house under construction, when it comes to culture and politics, Shanghai is still only a shadow of its former self. The world of serious culture that Zhou represents is widely under siege. She and her students may no longer be sent to jail for their love of Western music, but they suffer an almost equally ignominious fate--being largely ignored by a world that thinks only of business.

Just as during the days of old, visitors to Shanghai still expect to find a fascinating essence beneath the neon surface, something akin to what many have so vividly imagined from reading about the city of the ‘20s and ‘30s. When this essence eludes them, they tend to fault themselves for not being diligent enough in uncovering it. But the sad truth is that this old heart no longer beats in Shanghai. Deng’s legacy of all economics and no culture or politics has helped create a commercial monoculture devoid of shared ethics, a city without a soul.

Do ethics and soul matter? After all, perhaps a “civil society” will soon follow wealth. And anyway, some pragmatists argue, hasn’t China proved that the absence of such independent cultural, religious and political institutions is no impediment to development?

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The message of the fin de siecle Pacific Rim may be that Asia has ushered in a new mode of development in which culture, and maybe politics, are even more irrelevant than in Western capitalism. Pundits and investors are advised to remember, however, that self-interest alone has rarely helped a country mediate the kinds of inevitable contradictions--between rich and poor, industry and the environment, old Maoists and new entrepreneurs--that are incubating everywhere beneath the gaudy surface of cities like Shanghai.

When crises hit China in the past, the party was able to rely on some residual belief in its official ideology and in its leaders’ mandate to rule. However, Communism as a belief system ended irrevocably in Tian An Men Square in June, 1989. In the nightclubs, karaoke bars, corporate offices, and even party meeting halls of China today, one finds hardly a scintilla of these old beliefs. What has replaced them is an unalloyed appetite for wealth and materialism, with even much of the military “jumping into the ocean of commerce.”

When political crises arise after Deng’s passing, as they inevitably will, it is hard to imagine to what common purpose the party could appeal to create a new consensus. After all, alienated workers, lumpen floaters and disenfranchised peasants will pose a very different challenge to authorities than idealistic students. For now, everything depends on how long the boom lasts. “In the long run, I think Shanghai will be fine,” investor Yu Rong told me just before I left his Saige headquarters. “But if you ask me what will happen in six months, I really can’t predict.”

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