An Economic History of Luxembourg

This weekend, I decided to check off my list one of those tiny little countries that one rarely has a reason to pass through. While I’m only a four hour journey from Luxembourg, I figured that this might be my last reasonable chance. It’s also convenient because the Ardennes forest is the nearest place for me to find something that resembles a mountain and low population density.

I took off Friday for a three-day weekend, took a bus from Brussels to Luxembourg City, and then had a bit of an adventure with the public bus system to get out to a little town called Mullerthal, where I met up with one leg of a hiking route around the northeast of the little country. I spent a sleepless night in the dense forest and spent the next morning exploring the capital where I had started. The trip had some real highlights that I’ll get to eventually, but they’ll need some context.

For now, I’m going to continue my history kick and share a bit about this tiny country that most of you probably couldn’t place on a map (indeed, many world maps don’t even have enough resolution for it).

That’s actually a good place to start. Where is Luxembourg?

Well, I live in Belgium, and you know that it’s close to me, so it probably borders Belgium.

Indeed, it does, but can you even put Belgium on this map?

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Did you find it? Still struggling? It’s a small country. I’ll zoom in a bit.

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Ok, now you can see it. And even tiny Luxembourg made the cut!

If you’re still struggling, here’s the answer.

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At about 1,000 square miles, Luxembourg is a cutout at the junction of France, Belgium, and Germany.

But don’t let its size fool you. Both the World Bank and IMF have estimated Luxembourg to be the wealthiest country in the world (per capita; the UN disagrees, and I think I know why), and I can attest that it looks like it. Luxembourg city is so well maintained and so full of fancy cars, it’s actually a bit weird. This was the second six-figure car I saw in the first 20 minutes of walking through the city. Most of the others are new luxury cars.

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How did tiny little Luxembourg get so rich?

It’s actually not as complicated of a story as one might think, and it actually has a lot to do with its tiny geography.

Luxembourg has actually been around for about a thousand years. ‘Lucilinburhuc’ (literally translating to ‘small castle’) was a castle which became the centrepiece of what would become the County of Luxembourg over the 11th-13th centuries. The aristocracy of Luxembourg led successful armies and expanded their reach during this time. They were so successful that the house of Luxembourg even led the Holy Roman Empire during the 14th and 15th centuries. In the mid-15th century, neglect by the nobles who had gotten too comfy in their foreign roles allowed the Burgundians to conquer Luxembourg. Over the next four centuries, the area would change hands several times between the French, the Spanish, the Dutch, the Austrians, and the Prussians.

In 1815, with the defeat of Napoleon and liberation of his conquered lands, Luxembourg became a Grand Duchy, but it was divided. The Netherlands (more specifically King William I) was awarded the western provinces of Luxembourg. The eastern provinces became part of the new German Confederation. Most of the area makes up modern-day Luxembourg. Some of the eastern areas are now in Germany, and some came under Dutch control in the twentieth century.

The western provinces were treated just like any other Dutch province, but if you read my last post about the history of the Netherlands, you’ll know that this was a very brief period of unification. The Belgian revolution began in 1830 and ended with the Treaty of London in 1839. I’m skipping over all of this because the important part for our purposes is that the treaty gave Belgium the western half of Luxembourg, which is now (somewhat confusingly) also called Luxembourg (dark blue in the southeast here).

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Actually, when I told my colleague that I would be spending the weekend in Luxembourg, he asked, “The province or the country?”

And that’s how Luxembourg gets its current form.

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Even though the borders would be set for a long time to come, Luxembourg was in no condition to be a sovereign state. It remained part of the German Confederation until its dissolution with the Austro-Prussian War in 1867. Emperor Napoleon III tried to buy Luxembourg from King William III of the Netherlands. The Prussians still controlled the fortress (in what is now Luxembourg City), and they were not about to let the French just walk in. The most dissatisfying compromise for everyone was that no one would get the province, and it would remain neutral and disarmed. Though still technically the personal playground of the King of the Netherlands, Luxembourg was basically on their own at this point. With the death of William III in 1890, Luxembourg passed to the hands of Adolf of Nassau-Weilburg, the progenitor of the dynasty that still reigns today.

But despite all these pretty pictures, it doesn’t seem like any of this would make Luxembourg rich!

No, it didn’t. Luxembourg was pretty poor at this time. It wasn’t until the turn of the twentieth century, that Luxembourg started to put its mineral deposits to use. During the decades leading up to the First World War, immigrants flooded into Luxembourg to work in the mines and steel mills replacing the thousands of emigrants who flooded out of the industrializing capital in the nineteenth century. The increase in labourers led to legislative actions that would lay the groundwork for progressive worker protections in the twentieth century.

The First World War put a real damper on the economy after Germany violated the country’s neutrality, and devastating fighting ruined much of the countryside when they were pushed back. After the war, Luxembourg broke ties with Germany and realigned with Belgium. The “Roaring Twenties” is often characterized in the US by massive steelworks and the first skyscrapers; much of this steel came from Luxembourg. With increasing wealth came pressure for labour reform, and Luxembourg led the world in workers’ rights legislation such as a sliding pay scale that was pegged to the cost of living.

The economic crisis of the 30s hit Luxembourg as well, and another German occupation in the 40s meant that little progress was made until the end of the war in 1945.

It turns out that rebuilding a continent ravaged by four years of the most destructive warfare in history is pretty good for a country whose dominant industry is steel. On top of that, a forward-looking government pursued diversifying policies that attracted investors from around the world and aligned industries with other European nations through the European Economic Community (EEC), a predecessor of the EU.

By the time of the oil crisis in 1975, Luxembourg had 23 registered unemployed. No, I didn’t forget a unit there. Less than two dozen Luxembourgers were registered as unemployed in 1974.

The decade of the oil crisis saw a massive reorganization of industry and government as Luxembourg tried to weather to storm. A fundamental change was the creation of the Tripartite Coordinating Committee. The government was heavily involved in industry (holding a majority stake in the monopolist steel company), and from the 1970s onward, it would do so in a tripartite arrangement: requiring the approval of business owners, labour leaders and public officials. This restructuring alongside other very generous social welfare reforms allowed the Luxembourgish steel industry to survive the crisis and remain an important industry even today.

In the final two decades of the twentieth century, Luxembourg hit its first real boom. Ventures into the financial sector and IT alongside a very friendly tax environment (for both businesses and wage-earners) led to an average GDP growth per annum of over 5%, just behind Ireland, who is often hailed as the great European success story.

The next two decades were even better. With only a small faltering after the 2009 financial crisis, Luxembourg’s GDP has increased every year since 1980.

Good timing, a proactive and nimble government, and some valuable expertise have set Luxembourg in the perfect place to ride the waves of the global economy all the way to immense prosperity.

But this doesn’t feel particularly satisfying because lots of countries are in finance and IT. Lots of places can be seen as tax havens. What makes Luxembourg so special?

I’m going to offer my own hunch here. I think it stems from two things:

  1. They were first. This reorganization took place in the 1970s and 1980s. Most of Europe was still recovering from the war, the Asian Tigers were just starting to figure out how to do modern economies, Latin America and Eastern Europe were mostly trying to figure out how to get rid of totalitarianism, and the US was already too big and diverse to make sweeping reforms.
  2. Labour protections. Wages pegged to cost of living, tripartite decision-making, and strong unions. Luxembourg requires that employers pay fairly, and business-friendly policies attract the kind of capital to make such pay possible. This way, Luxembourg actually pays lower than the EU average in wealth redistribution, yet the minimum wage is about $28,000. That would be about $15/hour.

There is another reason why Luxembourg is the wealthiest country in the world per capita:

Lazy statistics.

Typically, GDP is calculated as the amount of money earned in the country over the course of the year divided by the average population over the year. That would give GDP per person, right?

Kind of.

Here’s a fun fact: about 40% of the people who work in Luxembourg don’t live in Luxembourg. Another third are immigrants and the rest are actually Luxembourgish. I’m guessing that’s why the UN statistics put Luxembourg third behind Liechtenstein and Monaco. Although it skews the data a bit, even correcting for it leaves a GDP per capita of over $100,000 (on the same scale, the US is at about $60k).

I think what you’re seeing when you walk around Luxembourg City is that the only people living there are the ones who can afford to stay. The ones who can’t afford to commute live on the outskirts of town (there are outskirts, and they’re definitely less pretty). The rest live comfortably in places that are a bit less expensive, but they can afford to commute.

So why is Luxembourg so rich? They work with money. It’s the best way to make money.

dammit, I knew I should have gone into finance…

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Mullerthal trail

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These are the kinds of German forests that must have inspired Grimm’s fairy tales.

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Monument to the United States military that liberated Luxembourg twice.

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Upon crossing the bridge into the old city, my first reaction (and I think many others’ is too) was “Is this place real?”

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The city is immaculately well tended.

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Capitalism

Are capitalism and environmentalism compatible? If we can’t accept it, do we have to pick a side? And if you’re on the side of environmentalism, what’s the alternative to capitalism? If it’s socialism, why hasn’t that worked yet? Do its failures give the capitalists good reason to doubt that it ever will?

 

Can we incorporate the realities of climate change into our capitalist system?

 

Is this really a good way to bring the powers that be to your cause?

Escalator Permanently Stairs: Chongqing’s Faltering Entrance Into the Modern World

In the southeastern sky, about thirty degrees above the horizon shines a single point of light. Whether star or planet, I am unsure, but it is the only celestial body whose light can pierce the thick haze that cloaks this city like an uncomfortable blanket. As the people of Chongqing sleep, Luisa and I look out over the grid work of lights that recede into gray infinity. As I try to soak in the city’s immensity, she spills the frustrations of her life as a first-world woman trying to survive in this second-world life. Several hundred feet up the side of the mountain on which Sichuan International Studies University resides, the balcony of Luisa’s apartment provides a beautiful vista of the expansive metropolis below. From here, the city seems serene and quiet, humble and unassuming, but we both know that an expedition down the mountain will reveal a completely different world. Chongqing is a city that has adopted much of the technology of the modern world, but its people have yet to learn how to integrate it into their closed society. It seems to be the result of millions of former and current peasants rapidly procuring twenty-first century technology while living under a government that is too proud and controlling to allow them to ask the outside world for help in figuring out how to use all their new toys.

On my first morning, we ventured out into Shapingba, the bustling commercial district a few kilometers from SISU. At the bus stop at the bottom of the mountain, I immediately likened the flow of buses to what I have seen on the streets of Seoul, a mega city with one of the best transportation systems in the world. The buses of Chongqing seem adequate, and the roads are generally up to modern standards. On the roads though, the flow of traffic seemed constantly within centimeters of collision. More than once the bus driver slammed on the brakes as another motorist cut him off. Paying no regard to lane lines, cabs and private citizens force their vehicles through any space the tarmac will allow them. When we arrived in Shapingba, I spotted technology stores and modern restaurants. When I pointed out the Apple store, Luisa concurred that we should get off at the next stop. Waiting for ours and other buses, dozens of locals clogged the parking area. Weaving our way through the throngs of lightly-dressed Chinese, we tread over brick and slab sidewalk to the nearest crosswalk. As we waited for the signal, I surveyed the area, a predictable concrete jungle of a city. Towering apartments line the six-lane thoroughfare flowing with cabs, buses, motorcycles, and other vehicles rattling and honking down the tarmac. Heavy with humidity, the hot, still air carried the scents of food, people, sewage, and exhaust in a quintessentially urban musk. When the light turned, the crowd at the curb hesitantly started to venture out onto the crossing stripes, justifiably concerned as taxis and motorcycles continued to zoom past, ignorant or apathetic of the traffic light’s command. After weaving through the stream of impatient motorists, we eventually made it to the other side where we reentered the thick mob of commuting locals.

On the way to the Apple retailer, we stopped at the multi-story telecom store at which Luisa needed to pay her phone bill. At the back of the second floor, there is a bank of ATMs where Luisa clicked a few memorized buttons with Chinese characters on a bright touchscreen. After Luisa swiped her card, the machine spit out a receipt, and it appeared to have worked. Stepping away, she reset her phone to ensure the payment took effect. Seemingly satisfied, she led us back out of the packed store. We passed throngs of customers waiting to ask questions about their current devices and others browsing the displays of the newest smart phone models. Slipping out through the half-opened sliding glass doors that no longer slide, we both looked left and right trying to remember which way we should go to find the Apple store. I insisted on right, she accepted, and we found it just around the corner.

When we entered, I immediately knew there would be a language barrier struggle. The attendant was an attractive young woman, perhaps 19 or 20, who clearly did not speak much English. Luisa tried to show her the issue, a cracked screen, and ask if they can repair it. The young woman searched her memory banks for the requisite English vocabulary to tell her customer that she only sells products. Looking at me helplessly, she asked hopefully if I spoke Chinese, but I returned the glance, even more impotent to bridge the divide. Finally, the message got through, and another futile conversation attempting to determine the location of the nearest repair center ensued. Even with the best efforts of this poor young woman and her male associate, we were unable to understand each other. We kindly thanked them for their efforts, and Luisa led us in the direction of where she thought she remembered seeing the other store.

Across a sleek marble terrace, we spotted the electronics mall. A chain of storefronts with matching signs displaying a variety of electronics manufacturers, the store is one large maze of display counters and service desks. With Luisa’s cracked phone in hand, we approached a gentleman tending the Macintosh section, and he immediately led us back to the repair desk at the far back corner of the store. With our problem communicated to the young woman sitting behind the long desk of computers, our guide nodded and departed to return to his post. There was one other lady at the desk helping another customer, and behind them are small windows allowing limited viewing of the repairmen in their cove full of tools and spare parts. Although Luisa’s needs were clear, communicating both the cost of the operation and the time to return is another matter. It quickly became clear that she spoke no English, so she and Luisa traded phones back and forth for several minutes trying to use the primitive translation abilities in the Chinese social networking app WeChat. Although I could not understand anything that was going on, it appeared the two reached a consensus, and Luisa slid her phone across the desk. The young lady then reached into a drawer, apparently accepting the uselessness of the machine in front of her, to retrieve a service form on which she scribbled some simplified Chinese characters and wrapped it around the broken phone. Paying for the service (working out to be about $80), Luisa informed me that we had about three hours to kill. As we walked, we discussed our options for spending the rest of the afternoon.

When we exited the store onto the marble terrace, I saw off to our right a mother standing over her squatting son. In front of a pillar that frames the entrance to the electronics mall, the child was clearly relieving himself directly onto the marble ground. When he finished, he stood and fixed his shorts, and the two continued walking down the row of storefronts. As in Korea, restrooms are far less prominent than you might find them in any American city, but I have never seen such a public display of bodily functions in an area that would reasonably in the Western world be considered inappropriate for the deposition of excrement. A phenomenon that Luisa has informed me is common, it revealed the cultural growing pains of modernization. Like a puppy in house-training, the people are still learning the etiquette of public spaces.

After briefly considering a cold treat a nearby Haagen-Dasz, we made our way to Luisa’s friendly manicurist in an underground mall nearby. Speaking the most English of anyone we have met so far, she shares polite conversation with us while Luisa gets a fresh coat of high quality nail polish, and I get my first experience with a nail cleaning. (My nails are still shiny, smooth, and free of hangnails.) Having my procedure finished long before Luisa, I took the time to wander the area and snap some photos. You can see a few of them in the third block of photos in the Photo Update.

After nearly getting lost on my adventure, I returned to meet Luisa as she waited for her new nails to dry. After a few short minutes, we departed to find a place to share a drink and finish off the remainder of the repair time. Burning another thirty minutes, we chatted about about my impressions of the day. After finding a surprisingly quiet outdoor cafe in the main square, we successfully made it to 2:30 and returned to the electronics mall. Impressed by their work, Luisa picked up the repaired phone, and we departed to catch a cab and retreat up the mountain.

While Luisa took some much-needed rest, I spent some time on the balcony trying to piece together what I have just seen. The entire day seemed to have been a contradiction. There on the balcony, it all looks so peaceful and serene, but I now know the truth of the overwhelming bustle on the streets below. The streets appear modern and functional, but the traffic upon them refuses to obey any semblance of law or order. The public spaces appear clean and usable, but some still see them fit for use as a toilet. The stores and people carry the latest versions of electronic gadgets, but the process of repairing them shirk the use of modern technology’s advantages. Though the people are well-connected through mobile devices, it appeared a common practice to physically commute to the store to pay a bill, something I have never done in the U.S. or Korea.

In celebration of a fellow rugby footballer’s departure the following day, a group of friends were to gather at an upscale restaurant in another district of Chongqing that evening. Before making the trek out there, Luisa and I met a portion of the party at a local beer store. I hesitate to call it a bar because there was, in fact, no “bar” present. On the a terrace outside a row of small shops and restaurants, we came upon a large green awning, sporting beer labels and the brewery Pivovar Náchod, a Czech brewery in a city by the same name on the Polish border. As we approached, the apparent owner, a short, balding man in a short-sleeved button-up shirt and shorts, approached us from behind, and jovially ushered us toward his establishment. We hesitated, one of the group deciding between this place and a proper bar directly across the narrow walkway. We decided to take a table under the Pivovar Náchod awning, and three of the four of us moved inside to select a beer while Luisa held the table, abstaining for the moment.  Appearing to be in some indiscernible order, dark bottles jaggedly lined the shelves built into the walls of the small space. Revealing a dusty gleam off the rows of beer, small display lights were the only source of light in the establishment. Although the selection on the walls was expansive, we all went for the single, small, glass-door refrigerator next to the door in which no order existed to choose a chilled beverage that may provide some relief from the muggy climate. We selected almost at random, and the owner welcomed us around a corner to where we believe we should pay. On the counter behind a now-defunct register are scattered empty and full bottles. Unsure exactly what is going on – it seemed that he did not expect us to pay until after we had enjoyed our beverages – someone asked for a bottle opener. The owner hunted along the counter top of stray bottles until he located one and then kindly opened our bottles for us as we stood there. Before we headed back out, he found glasses – stored upright on the counter – for each of us. We retreated to the terrace table with our mystery brews. It turned out I had selected a mediocre French ale, which was tolerable in comparison to the bland seeds we had been provided for munching. While we sipped our drinks, Ian (a fellow visitor) and I shared our reflections on our experience so far while Luisa and Samantha concurred with our less than positive reviews. At about a quarter-way through the drinks, a fellow SISU foreign teacher arrived, grabbed a beer with more confidence than we had and joined us at the table. Constantly distracted by his phone, he chimed in occasionally, revealing his inability and lack of effort to integrate after three years of teaching in the country. With beers finished, we showed our bottles to figure out what we owe the man, paid, and made our way to the nearby street corner to catch a couple cabs.

Speeding along congested boulevards and open highways, the taxi made its way over several kilometers as we charged further into what appeared to be the heart of Chongqing. Buildings grew taller and lights brighter. As we drove along the waterfront of the Yangtze River, the facade of a particularly upscale apartment caught my eye. With clean lines carved out of elegant dark stone, the seven-story building looked more like a luxury hotel from Paris than a residence hall in this upstart central Chinese city. Turning to Luisa, I asked if she knew what the building was. She noted that she had actually visited the apartments to take salsa lessons. Making a point of the difference in cost of living, she challenged me to guess how much average rent might be. Taking a moderately educated guess, I said about $1,000 per month. I was way off. A three-room apartment overlooking the river could be secured for as little as $200 a month. She then explained that Chongqing has been attracting a flood of up-and-coming businessmen from the larger coastal cities who can start their careers at a fraction of the cost. Crossing a soaring bridge over the portentous river, Luisa pointed out Kempinsky’s Hotel, a regal tower on the far shore, fitting nicely into the row of refulgent hotels and office buildings.

Paying the cabbie a paltry sum for his labor, we left the street and strolled through well-tended flowerbeds and extravagant marble sculptures on our way into the bombastic lobby. Only a small trio of expatriate businessmen sat chatting over drinks in the lounge as we passed through. The restaurant occupied the left side of the building’s ground floor. Entering, I quickly recognized the attempt at an authentic German theme, replete with Chinese servers in lederhosen. The back half of the restaurant was practically empty, but I could see that most of the guests had chosen to sit on the other side of the long L-shaped bar closer to the stage, on which a jazz band was blasting an upbeat number. Two of Luisa’s friends, a pair of young Englishmen, had secured a long table and were already working on their first liter of beer. When the rest of our party arrived, Ian and I found our way to the bar to order our own drinks, and the girls started procuring free bottles of wine that had been provided for ladies’ night. By the end of the evening, I had quaffed at least a bottle’s worth of the cheap Merlot from bottomless glasses that continually appeared in front of me. Although the food was delicious and the company entertaining, I still have a bitter taste of that night because of the final conversation I had with a young Englishwoman whose proper British accent became attached to my own tongue in an offensive display of inebriated envy.

After cruising back through the city lights in a dream state at an indeterminate hour to Luisa’s mountainside residence, I spent half an hour staring out an open window over the lambent city lights while sipping cup after cup of water – a surefire method to ameliorate the inevitable hangover.

Only a long tutoring session during the afternoon filled Luisa’s schedule the next day. Taking most of the morning for recovery, we slowly pulled ourselves together as Luisa prepared for her lesson, and I finished the story of the demise of Christopher McCandless in Into the Wild. At the restaurant where Luisa holds her lessons, we sat for a few minutes before her student arrived. Though the designers pulled in every piece of French decor they could find, the “French Caffé” felt in no way European, and it was clear that the staff spoke no French nor English. I ordered a plate of Indian curry that I would finish at another table while Luisa began her lesson. With a runny curry sauce and a littered with chicken bones, the plate of rice hardly satisfied, but it would take a bit of exploring to find another suitable eatery. Agreeing to meet Luisa back at the apartment at 7:00 that evening, I set off to explore the campus and snap some photographs. The best of them can be found in the Photo Update.

I returned briefly to the apartment to empty my undersized memory card, and I took the opportunity to investigate roof access. Much to my satisfaction, the roof door was unlocked. It proved to be grimy and littered with old plants that residents had discarded, but the slopes roof was too high to see anything but sky. A raised path of crumbly concrete wound its way around the narrow corridor formed by the building’s core and the eaves. Plagued with a sense of unease about what other litter I may find around the corner, I minced my way along the pathway. In the center of the second length, I felt my psychic unease become physical as my right foot plunged through the weak concrete. Panicking, I jumped off the stone, my heart suddenly racing from the half an instant I felt as though I was going to find myself on the floor below. Fortunately, the only damage was a square foot of collapsed walkway, and I continued, shuffling along the moss-covered roof surface pinned against the building’s core. Around the next corner, I saw a chest-high wall that would be perfect as a step onto the ultimate roof a meter above my head. As I prepared to vault up onto it, I caught a glimpse of the other side of the eight-inch thick barrier: a column of windows leading eight floors straight down to the pavement outside the front door. Now completely shaken, I stepped back from the wall the rethink my plan. Having recently read of John Krakauer’s harrowing solo climb up the nearly-vertical 4,000-foot face of the Devil’s Thumb, I knew that my mistrust of my abilities to keep myself on the safe side of an eight-story fall was pitiful at best. Keeping my center of gravity well on the near side, I lifted myself onto the wall. Arms spread eagle, holding myself up against the top of the eaves and top of the roof, shimmied into a position from which I could lift myself up onto the higher platform. Standing victoriously on the edge of the tower, I surveyed the expanse of the city.

Disappearing into a cloud and smog haze several kilometers away, the spread of towers seemed endless. Of the buildings in sight, at least a dozen were flanked by spindly cranes and even more appeared hollow and empty. I immediately remembered the common phrase describing cities like Las Vegas: “Build it, and they will come.” Come, they have. Chongqing has been welcoming an increasing inflow in the hundreds of thousands every year for the past few years. I could easily believe that enough residences had been constructed within my view to house all of these newcomers and more. A New Geography article from last summer claims that the extreme estimates of Chongqing’s population (nearly 30 million according to China’s National Bureau of Statistics) come from an accounting method that includes thousands of square kilometers outside the urban area, but from my vantage, it appeared there was no end to the urban area.

Coming down from the roof and my adrenaline high, I headed down the mountain to venture out into the city. At the edge of campus, the bustle of the city begins abruptly with a congested intersection through which a line of vehicles honk and clatter along making a dreadful racket. A few hundred meters on, the first rows of store fronts emerge along the two-lane road. Rows of trees shade the tiled sidewalks that form a barrier between the shops and the road. Off in search of food, I found the small strip mall in which I later realized was the beer store we had visited the night before. In the center of the mall, leading up the the second floor, is a pair of escalators. Both are stopped and appear to have been that way for a long time. Immediately a joke from the late comedian Mitch Hedberg comes to mind: “There would never be an ‘Escalator out of order’ sign, only ‘Escalator temporarily stairs. Sorry for the convenience.'” Here, however, there is no sign, only the understanding that these escalators will most likely remain stairs. Passing the escalators to see what is on the other side, I spotted a woman crouched over a sewage drain. She looked up at my appearance, and I quickly turned back with the feeling that I had just seen something I was not supposed to have seen. The moment was brief, but it was long enough to notice the strainers at her side and that she was pulling something up out of the dirty water below. What exactly she was doing will forever remain a mystery.

On my final full day, I persuaded Luisa to join me for a hike in the mountains behind the university. It didn’t take long, however, for the irksome and disruptive presence of the others who had the same idea to drive her from the adventure. Left to my own devices, I set off to explore my way to any peak I could find. The trails climbed continuously up stone steps and brick paths. On this given Sunday, the trails were crawling with locals, often in urban fashion, completely unsuitable for proper hiking. Also looking to escape the constant stream of chattering adventurers going both directions, I found an unpaved trail that led around to the opposite face. However, despite the unpopularity of the trail, the silence I often expect from such nature retreats had no refuge here. Even from the upper reaches of the mountain, shouts and laughter pervaded the thick jungle, and the din of the traffic below laid a constant background hiss. Eventually reaching an observation point that turned out to be part of some sort of camp, I finally accepted an undeniable cultural difference. If you have ever spoken to someone who grew up in an urban area like Manhattan, you likely noticed the increased volume of their regular speech. The people of Chongqing, however, are at a new level. Though only about a dozen other people were milling about the summit, the sheer volume of the noise they were emitting elicited the feeling of an energetic nightclub in which the music is too loud and the patrons must match the volume to be heard. Except here, the background was not a busy club, but a still mountain peak. My fellow hikers seemed unable to make the distinction.

On my way back, I decided to stop at a small restaurant on campus to satisfy a constant hunger that had followed me much of the trip. While waiting to order from the middle-aged woman behind the counter who was both cashier and cook, the student waiting for her order to finish said hello and asked if I needed help ordering. Though I never figured out exactly what the wrap thing was called, she kindly ordered it for me, even asking for what option I wanted. Her English sounded good, but it was clear that her vocabulary was limited and that she had not used the language in some time. Taking my wrap, which had cost me about 85¢, I procured a bag of sliced watermelon from the adjacent shop via gestures and the three Chinese words I knew before returning to the apartment.

That evening, Luisa and I pulled chairs onto the balcony to enjoy the gently cooling air while discussing China’s demise over half a bottle of overpriced Shiraz. Though clearly jaded by a string of a bad experiences and her imminent and quickly approaching escape from the country with which she has fallen harshly out of love, I believe that she has correctly surmised that the system will eventually break down. Posting GDP growth in the double digits for much of the last decade, growth has steadied below 8% for the last few years. After 1978, the Chinese Communist Party (CCP) implemented Perestroika-like reforms to allow more freedom in economic endeavors, ushering in decades of enviable growth. According the IMF, much of this growth has stemmed from rapid rises in productivity of labor. As people flooded into urban areas and business in more rural areas were allowed to spread, the proportion of agrarian laborers plummeted leading to a growing and hardworking urban workforce. Placing the source of growth more on labor than capital, the sustained growth is dependent upon a growing labor force. For the time being, China appears to have no shortage of cheap labor. With anywhere from 80 to 200 million people in poverty (depending on the definition of poverty), the booming economy will maintain its driving source for many years. However, as that population ages, that surplus will fall. At less than the population-sustaining two children per woman, the birthrate in China has stabilized around 1.7 children per woman since the mid-1990s. Declining populations pose a threat to many economies as the global population stabilizes, but to the Chinese, I believe this problem will lead to their demise.

The CCP maintains a strict hold on the the Chinese people, demanding military training from all college students and insulating the flow information from the western world with what has been coined the “Great Firewall of China.” LIke its Soviet predecessor, the CCP demands an unwavering and conceited patriotism. Restrictions on free speech, press, and assembly and hardly a pretense of a democratic process all but eliminate a peaceful method of reform. With that said, most Chinese have no reason to complain. With hundreds of millions of Chinese coming out of poverty, life is good and improving for most. By no means at the standard of living of most western nations, it is not luxury, but it is far better than many have ever known. However, now that so many of them have tasted what such a life could be, any threat to that may sow the seeds of unrest.

As has been the case in other autocratic states, as the reduction in labor and falling economic growth finally catches up with the Middle Kingdom, the CCP will likely tighten the screws, reinforcing its Socialist Core Values. Based on Marxist ideals and powerful nationalistic sentiment, the values are a guiding light for CCP and, as they hope, the Chinese people. Although Asian cultures have historically been much more accepting of rigid social systems, the enforcement of such collectivist ideals as failed around the world. Even in such Confucian states like Japan and South Korea, restrictive legislation has been chipped away, reaching a point of personal freedom very similar to the West. With no method for redress, those aiming to maintain their livelihood will rebel. Luisa and I postulated that this unrest will begin to develop within the next couple decades. Hypotheses for the downfall ranged from dissolution of territories to all-out civil war.

Though interesting, it is all speculation. At the moment, China seems to be entering a period of sustained growth. If the CCP and whatever free enterprise actors are at work can develop a plan to continue Chinese growth in an economically and ecologically sustainable manner, such a disastrous downfall may not come to pass. That does, however, mean that the current model of incessant building will probably continue. As a result, the number of abandoned buildings I spotted from the roof will continue to grow. With an abundance of space, it remains easier to continue building instead of replacing. As we sat overlooking the virulently spreading city, I couldn’t help but chuckle as I considered those poor neglected escalators. Perhaps, though, someone will have the courtesy to simply put up a sign: “Escalator permanently stairs. The CCP apologizes for the convenience.”