Sold on promises: China's intra-working class exploitation

Chuanxiao base in Ningxia Province.

An interview recorded from memory. This blog is about the upsurges that occur, the cracks that appear in China’s system. But sometimes the picture we give out of a China in revolt is rosy in a way that misses the very deep scarring in this society—the kind of fracturing of trust within the working class, between friends and family, in the relationships that underlie organization.

Submitted by Nao on November 20, 2014

This is familiar to us, in broken communities in other places, among traders of the kind of drugs that ruin people, for example. Yet here mutual suspicion and mutual harm seem especially present in the working class. We must not forget the obstacles. How do you build trust when there is so little?

X works in an electronics factory today. He has been back in regular factory work less than a year. He, I and a young girl from the same factory have snatched seats at a street food stand for a late dinner. His department denied them a dinner break today.

X: I was in the Northeast.

Interviewer: What were you doing there?

X: I was in chuanxiao (传销).1

Interviewer: Oh, you went there straight out of school?

X: No, I’d been out several years. I went up there in 2012. Went home in 2013. After I went home I didn’t feel like I could talk to anyone. I couldn’t talk to my mother. I would go out into the fields and work all day, then go home. It’s a little better now.

Interviewer: Why couldn’t you talk to anyone?

X: We’d had an experience that exceeded that of any normal person…

Interviewer: What do you mean?

X: … Let me put it this way… from going in being a 20-something year old I came out just a short time later feeling over 40. Can any regular person understand that?

Interviewer: Do you mean, you’d seen sides of people most people don’t get to? That you became less trusting of people?

X: Sort of.

Interviewer: How did you get brought in?

X: A friend. Or I should say a former classmate. It’s always friends or family. It’s not much different from zhixiao (直销).

Interviewer: I thought those were the same. What’s the difference?

X: With zhixiao you’re selling a product.

Interviewer: Wait… with chuanxiao you don’t? How do you make money?

X: We call family and friends to get them to join. People pay money to join.

Factory girl: How much does it cost?

X: I paid 2900.

Interviewer: Wait… so the difference between zhixiao and chuanxiao is that with zhixiao there’s a product you sell and with chuanxiao you’re purely making money off tricking people into paying membership fees?

X nods.

Interviewer: … I don’t understand. How do you convince people to come to something like that? Do you tell them what they’re getting into?

X: Of course not! How would you get people if you did?

There is a pause and we make some headway on our steaming bowls of soupy street food.

X: Usually, a friend first gives you a phone call. For example you, you’ve just come back from America. I haven’t seen you in a long time. I’ve given you a few months to get bored of the South, you’ve had your fun down there. I give you a call. Listen here, I’m up in the North and it’s beautiful up here. It’s cool in the summer and you can enjoy yourself in warm air-conditioned rooms in the winter. There’s lots to see and plenty to do. Why don’t you come up for a visit? Spend some time here. You’ll think, that sounds good. It’s just at the hottest time of year down here anyway. I might as well, go up and see how it is in the North. Then you get yourself a ticket and head up.

The next step is to give you a call when you arrive at the platform. Most people arrive by train. That’s what we can afford. They give them a call and warn them that there are a lot of tricksters at the station. Tell you not to talk to anyone. Because lots of people know, that if you come up to the North like that, you’ve being drawn into chuanxiao. They give you that warning so you won’t talk to anyone. So you won’t find out. Then they arrange all the proceedings to get you from the station to the chuanxiao base.

At the base, everybody leaves, except for your friend, and two other people, usually one women and one man. The three of them receive you, so there are four of you, including yourself. They tell you you must have had a tiring journey, and insist on giving you a foot massage. They take off your socks—

Factory girl: What if you don’t want them to take off your socks? I would feel really uncomfortable if someone just wanted to take off my socks.

X: If you’re comfortable with it they’ll take them off for you. If not, they may let you take them off yourself, but they’ll insist on giving you a foot massage.

After the foot massage, the four of you head out to wander around, and when you come back, you start to play cards. The point of playing cards is to keep you distracted. It keeps your mind busy, so you don’t have time to think about anything else. You feeling really high, having a good time playing cards. Then you have dinner, and several more people join you. The boss comes in and takes a look around at your little group and notices, “and who’s this new lady joining us?” Your friend explains, oh, that’s my friend. You have a good time, eating and chatting with everyone. You get this feeling of family like you’ve never had before. They’ll talk you up, how amazing this place is, how beautiful the environment is, how much potential there is for development.

After dinner you play another game. And this game is critical—catch the little joker. Someone in the group takes out some cards, including a big and little joker. People in the group draw cards, and the person who draws the big joker tries to catch the one with the little joker. If they catch them, the little joker has to either accept a dare—they have to do whatever the person wants—or they have to answer a truth—they have to answer whatever question the big joker wants. At first the questions are trivial things. How do you like this place? What did you do the other day—

Factory girl: If you have a girlfriend!

X: Yeah, like that. But then the questions get serious. What do you think of this group of people? This is a good group, interesting. Do you think this place has potential for development? Yeah, I guess so. And then, and this one is really critical, what would you do if your friend tricked you? … Well… if it were for my own good, then of course I could forgive them.

Then at some point some of the other people start filtering out of the room. At first you think they’re going to the bathroom. Then there’s only you, your friend, and the original man and woman left. The boss comes in. What did your friend here tell you you were coming up here for? To visit for a while, to have fun. What if I told you that’s not the real reason he called you up here? It’s not? Then what am I up here for? What if I asked you if you wanted to stay and join our team? Join your team? Do you think of the people we have here have potential? There is something different about you all, different than regular people. Do you know what we do? No. We do something called zhixiao. Have you ever heard of zhixiao? No. It’s an advanced business model from America—

Factory girl: They haven’t heard of zhixiao?

X: Very few people have.

Interviewer: It makes sense that the people who made it up there haven’t heard of it. The ones who had probably wouldn’t have come up.

X: The boss doesn’t explain too much for you. He tells you there’s some events tomorrow. Why don’t you go and check them out. So you think, why not, and go the next day to their events. It’s a kind of training class. They talk about things like marketing and social networking, things that sound impressive. And the speaker sounds convincing, goes on for an hour on end without taking a breath. You think, if my oratory was that good, wouldn’t that be great. Overall, you have a sense that this is something different than you’ve ever seen before. These people have suzhi (素质),2 they’re educated. Roughly translated as “quality.” A broad term used to describe everything from the moral character, to the level of education, to the bearing of a person. Perhaps better understood as how “civilized” one is. This might be an opportunity.

The factory girl gives us her opinions as the story comes to a pause. We talk about regret and trying things and the importance of sharing your experiences. X expresses he doesn’t see the point in sharing his story broadly. He takes advantage of the break to munch.

Interviewer: I still don’t understand. Even once you get people to a thing like this, don’t people start to think about where the money comes from?

X: They don’t tell you. There’s lots of levels in the operation. [Some five levels total from regular members up to the president. I don’t remember the titles.] Knowledge is kept to different levels. Certain things you’re only allowed to know at the higher levels.

Interviewer: But don’t you start to be suspicious after a while how people get so rich without a product?

Factory girl: He means even if you ask, they don’t tell you.

X: Things are run with a military like discipline. Each level obeys the level above. Regular members sleep on the floor. Well, in the south they sleep on beds, in the north on the floor. The levels from jingli (经理) (director) on up sleep in hotels. At least three stars. The most important rule of the operation is obeisance. They tell you if you’re not supposed to know, don’t ask.

Interviewer: But aren’t people suspicious about where that money comes from?

X: Yes, of course.

Interviewer: When do they start wondering? When do people usually start thinking about that?

X: When business starts to go sour. When from being really busy normally it starts to slow down and they have nothing to do. Then they start to wonder.

Interviewer: I see. So they keep regular members from thinking about this by keeping them busy normally like they do when they initially trick people into joining.

X: People start to leave when they start to not be able to make any money. And when people below you start to leave, those above them lose their base and their sources of income, so they may leave too. At some point, the leaders at the top start to disappear. I feel sorry for the lower level managers. They still have to pay the electricity and gas bills, and when no money is coming in, sometimes they have no choice but to bail. During that whole time, regular members still have to pay for their keep. Two hundred and seventy something yuan per month, thought that is relatively cheap.

Interviewer: I’d guess the fare they give you isn’t very good. Filling, cheap stuff.

X: Yeah.

Factory girl: Why can’t you report this kind of thing after you leave?

X: You think the government doesn’t know? They know. This kind of thing is everywhere. In every province except the really remote ones like Tibet and Xinjiang.

Factory girl: Why don’t they do anything about this then?

Interviewer: Because, it doesn’t directly threaten them. Their precious social stability. And it even gives some discontented people some temporary hope, a way to while away the time.

X: Also because this kind of thing brings money to those areas. These things never pick the rich coastal provinces. These things always spring up in the worse off areas. The areas that need income.
Interviewer: Oh, true. Local governments would of course support this kind of thing. It brings money into their district from other districts. I hear there’s a lot in Anhui.

X: In Anhui, in Hunan, in the Northeast. All the locals know. Don’t think they don’t. These areas are large residential areas. Huge areas with no factories. What else could so many out-of-province people be doing in this area other than chuanxiao. The local people know as soon as they ask where a visitor is from. But they ignore it.

Interviewer: How many people used to be part of your operation?

X: A couple hundred.

Interviewer: How do they keep that many people going at this?

X: Hope. There’s this sense that all your family and friends are there. You don’t want to leave and miss out if all of them make it big. You want to make it up like the jinglis.

Interviewer: How long does it take to become a jingli?

X: Nobody really knows. They advertise some got up there in a year and a half, but those who have been here two or more years knows better.

Interviewer: Then why don’t they tell people?

X: They’re scared to. They’re not supposed to. And then if they told the people under them, those people would leave and they would be without an income. But there’s also still hope. There’s also this sense that now is the only time. If we don’t do this now, in a few years been suppressed by the police we’ll have no way out. We’ll be stuck poor and looking at people who made it and now have money.

I went home only because my father was sick and needed my help. Honestly, I still had some hope when I left. Only some time after I went back home, when I started to read online that many people had been through the same experiences, did I really realize …

After this conversation, I asked two other people—a college student from the countryside and another migrant worker—if they knew anyone who had fallen prey to one of these schemes. One knew a cousin and a friends’ roommate had. Another suspected his own older brother had been in one and was lying about it. He was probably ashamed to mention it. I have heard these operations mentioned countless other times, and they are a symptom of and contributor to the broad erasure of trust within the working class. In a less flashy, but no less dramatic rendition of the infamous faking granny suing passing biker for injury compensation, these schemes slowly pit the working class against each other in the race for money, turning the personal relationships and trust between people into tools of exploitation and degrading that trust in the meantime. This is the case too in the race of small peasant-businessmen who turn their relatives and friends into tools for the building of their businesses in a cut-throat marketplace, and abandon them when work injuries or bad times strike. In the fervent beyond anything race-to-make-money-while-the-moment-is-hot that now afflicts China, betrayal is commonplace and the default is suspicion. Any organization has to deal with this hurdle.

X is now self-studying in hopes of getting a certificate in psychology. He has a certain charisma, but also a certain rigidness in his speech and movements. Half confidence and half hesitation in a combination that is hard to decipher.

  • 1I have continually heard talk about chuanxiao in the manufacturing districts of the Pearl River Delta, warnings about being tricked, whispered stories about people who went in. For the longest time, I had understood it as a normal Ponzi scheme, where people tricked friends and families into joining their network of selling a good. This conversation, however, finally explained to me the difference between what is called chuanxiao and the term zhixiao, that people were always comparing it to. The mere fact that this thing called chuanxiao works adds a whole new level to my stupefaction at what a roaring capitalist society can do to the human mind.
  • 2Roughly translated as “quality.” A broad term used to describe everything from the moral character, to the level of education, to the bearing of a person. Perhaps better understood as how “civilized” one is.