23 JULY 1948, Page 8



THROUGHOUT the whole of the last century Shanghai never enjoyed anything but a somewhat evil reputation, but to those who lived and worked in Shanghai this bad name was not deserved, because there were many fine and generous facets to that vast city. Shanghai, in fact, never was as bad as it was painted, and the same holds good today. Admittedly inflation, insecurity and perhaps in- competence make life difficult and at times even hazardous, but the administration of the town works in its own peculiar Chinese way, and the inhabitants contrive to live with a smile on their faces. There is plenty to eat, there is water, there is light, there is transport, and if the winters are cold, nevertheless there is enough fuel to cook on. Moreover, in spite of many difficulties, the commercial com- munity of Shanghai, both foreign and Chinese, has, with its usual resourcefulness, succeeded in trading, and the years 1946 and 1947 will be recorded as profitable ones in most trades. The same is true of most of China. The farmers have had good crops, and where war has not intervened they and their families have had adequate homes and sufficient food and clothing.

To anyone who knew Shanghai before the war there are now two main changes. The first is the population, which was possibly 3,000,000 before the war, and is now at least 4,500,000. The city is no bigger physically ; consequently the streets are crowded, the houses cramped, utilities strained, and those who complain that the administration is not what it should be often overlook the fact that the problems facing the City Government are far greater than ever before. The boundaries of the old foreign settlements still seem to contain Shanghai and its milling hordes. Before long it will have to expand. The second feature is, of course, that the old Shanghai Municipal Council, which was largely British-run and very efficient, too, has been replaced by the Shanghai Municipal Government, pre- sided over by a Chinese Mayor and a series of bureaux. In this Government there are a number of hard-working, intelligent and conscientious officials ; but the entire lot are underpaid and over- worked, with the inevitable result that in the lower ranks these qualities are often, of necessity, submerged in the struggle for exist- ence. There is no doubt that the new Government does not operate with the precision of the old, but the bare fact is that it does operate, and not so badly as its critics would sometimes have it.

Superficially the Shanghai Municipal Government works in the way that the average foreigner would expect, that is to say, the Bureaux of Public Utilities, Works, Health, Education and Police carry out their normal functions and the Mayor directs the whole ; and when it is considered that China is going through one of the most acute bouts of inflation and rising cost of living that have yet been experienced in the East, it is not surprising that the Municipal.

Treasury is empty—and for any administration to operate without money is impossible. Therefore the fact that the Mayor's Govern- ment is sufficiently successful to keep the city going is a matter for some satisfaction. This simple picture of the machinery of govern- ment is deceptive, for under the surface there are many conflicting currents. For instance, the Chinese Army, through the Woosung Garrison Command, exercises an unusual degree of influence. All

armies tend to be laws Unto themselves, and to this the Chinese Army is no exception, but it adds to the confusion by having to

finance itself by unorthodox methods. The result is a clash of interest between the Garrison Command and the Mayor's Police Force.

Another unusual feature is the Shanghai City Council, a brand new and popularly elected body of gentlemen, some hundred or more strong, whose enthusiasm in an uneasy combination of their personal interests and their public office outruns their sagacity, and frequently produces recommendations and decisions which are not always in the best interests of the city. The Central Government in Nanking also interferes in the local affairs of Shanghai, both in domestic matters such as public health and in general policy, where financial and trading restrictions are concerned. Yet another conflicting interest is the activity of the old secret societies and the party machines of the Kuomintang and the Communists ; these under- currents are strong, and make the task of the Mayor, K. C. Wu, heartbreakingly difficult. Fortunately, he is a man of infinite energy and resource and a skilled administrator. Shanghai owes him a great debt for what he does.

It is interesting to consider where the foreigners, particularly the British, stand in this town, the control of which was originally theirs.

The answer is that they play little or no part at all. The Mayor has a Sino-Foreign Advisory. Committee which meets from time to time and serves a useful purpose as a safety-valve where foreign interests are concerned. It cannot be said, however, that it takes anything but an academic interest in what goes on. The foreigners have adapted themselves to the new conditions very quickly. They live an orderly, disciplined life, and as a whole seldom come into conflict with authority. So far the amenities of life have been avail- able to them, and therefore they have not complained unduly. The

Police Force, which at first was not successful, has improved in the

last year ; traffic-control and other police duties are better performed. The foreigners pay their taxes, and while there is a latent suggestion of " no taxation. without representation," this cry has not been raised. It is fair to say that if a foreigner has a legitimate complaint, his case will probably be heard. This does not mean to say that his grievance will be put right, but he is no less unlikely to succeed than his Chinese fellow-citizen.

All this is true of Shanghai and of other places, too. Foreign influence in China is less than it used to be ; but foreign relations are generally happier. American financial influence is, of course, considerable, but this is more on the Government level than amongst the people. In New York, London and elsewhere, as in Shanghai itself, people often ask what is going to happen in Shanghai. The -outlook is not particularly bright, because the city, which found itself at the end of the war very much down at heel, has not been able to do much to rehabilitate itself. Meanwhile, Chinese trades unionism has made a big and flashy start, and since it is usually ill-disciplined and often ill-advised, the result has been that labour comes into sharp dispute with 'Municipal authority. There is danger that if inflation goes too fast industries may collapse and labour find itself without pay or food ; but this need not necessarily happen, for there has never been such a town as Shanghai for finding a way round every difficulty. The main threat to Shanghai is Communism.

No one can tell whether it will come or not; and many- believe that the National Government, either as it is or reconstituted on more liberal lines, will succeed in holding the threat at bay, particularly

if American aid, food and finance are made available quickly and substantially.

Shanghai's problems are, of course, peculiar to itself, but they are part and parcel of the whole China situation. This situation is deter-

mined by the swing to the Left which has been so clearly marked throughout the whole country in the last four or five years. It is not. so long ago that the Chinese Communists were tucked away in Yenan, almost unheard and unheeded. Then came their emergence into world politics, and today they are well-established and sufficiently powerful to threaten the downfall of the Generalissimo and his party. Those who keep their maps of China up to date will find that large areas are now coloured red. Just as the Communists and the labour element in. Shanghai are of vast importance, so they are throughout the country. It is not the purpose of this article to speculate on the future of Chinese politics, but the account of Shanghai which has just been sketched gives, in miniature, a picture of the whole situa- tion in China. Lieutenant-General Wedemeyer, in one of his recent announcements, stated: " What China needs is good management." The story of Shanghai shows the difficulties of finding good manage- ment. If the other cities of China, and the Government itself in Nanking, had the same leadership as Shanghai has, many of them would be much better off.

China today is in agony ; the vicious circle formed by civil war and inflation seems unbreakable. The war cannot be stopped without more expenditure, and the inflationary budget cannot be reduced until the war is stopped. America is making great efforts to bring help, and Russia is said to have evil designs for all Asia. Will Russia win in China or will America ? The answer is that neither will, for China will just remain herself.