Middle class malady

Struggling and frustrated: Most aid goes to the B40, leaving the M40 feeling adrift and on their own.

 The economic future of the country looks scary, and if the young bankrupts and imminent retires are not atteended to soon, we could be in truly tough times.

THE economy is the most talked about topic among Malaysians, with issues including the increasing cost of living, shrinking ringgit, continuing weak economy and sadly, the endless politicking.

While attention has been cast on the Bottom 40, or the group known as B40, as they make up the lowest earners, the middle class, the Middle 40, or M40, shouldn’t be forgotten either.

Malaysians are categorised into three different income groups: Top 20% (T20), Middle 40% (M40), and Bottom 40% (B40).

To be in T20, a household’s monthly income should at least be RM13,148, while the M40 and B40 groups have raised their bars to RM6,275 and RM3,000 respectively.

We don’t need a survey to know that the people in the bottom half of M40 and B40 are barely making ends meet and struggling to maintain a decent lifestyle.

At the lowest end, 70% of these poorest are the bumiputeras, while the rest are Chinese and Indians, which proves the poor comprises all races.

The M40 – which forms 40% of Malaysia’s population – includes mostly wage earners, in both public and private sectors.

The bulk of their income goes to paying the car and housing loans, rent, and groceries. After deductions from the essential bills, such as phone, Astro, petrol, and children’s education, there’s barely anything left to save.

It’s harder for those who need to take care of their ageing parents, a noble endeavour which naturally includes settling healthcare bills, and even expenses for care takers.

And since the majority of the M40 lives in the cities, the household income of RM6,275 is almost negligible, and they can hardly be faulted for feeling that their standard of income has dipped drastically while the cost of living has increased.

The M40 essentially comprises the most frustrated lot since most aid goes to the B40, leaving the former feeling adrift and on their own.

Most of them don’t have alternative revenue streams besides their monthly wages, and they are dependent on corporate performances, so the overall economy is key.

They are unlikely to care that the Department of Statistics’ Household Income and Basic Amenities survey indicated that the mean income of households in 2016 reached RM6,958, a 6.2% annual appreciation from RM6,141 in 2014.

The survey also revealed the incidences of poverty decreased from 0.6% of the population in 2014 to 0.4% in 2016. Compared with the population of 30.7 million in 2014 and 31.7 million in 2016 (from the same portal), the numbers also decreased from 184,200 to 126,800 from 2014 to 2016.

The 11th Malaysia Plan (2016 – 2020) Mid-Term Review stated that the mean household income is predicted to reach RM8,960 by 2020.

The term “middle class” has different meaning and measurement to economists and academics from those classified in the M40 category.

As one analyst rightly pointed out, a household of four living in the Klang Valley with an income of RM4,000 per month, would be classified as urban poor due to the higher cost of living. However, that income would be comfortable to live in Pasir Mas or even Taiping.

It won’t be wrong to suggest that at RM4,000, that’s only enough for a single person to live in the Klang Valley.

We need to understand that the key people driving the country’s economy are the middle-income and top earners, many of whom feel they have fallen between the cracks of progress.

At every Budget, they seem to be the forgotten Malaysians, and each year, they hope for lower level tax bands for themselves, so they can have extra disposable income, but that never happens.

Khazanah Research Institute’s (KRI) State of Households 2018 revealed a steady increase in the income gaps between the Top 20% (T20), M40 and B40 groups since the 1970s. In 2000, the estimated real mean household income differences between T20 and M40, M40 and B40, and T20 and B40, were RM6,000, RM2,000 and RM8,000 respectively.

By 2016, however, it increased to RM9,000, RM4,000 and RM13,000.

These figures show that T20 households are gaining wealth at a faster rate than the rest.

Despite the improvement in mean household income figures, the gap between income groups continues to rise, and the survey added that “the escalating cost of living has put financial pressure on the M40 and B40 groups.”

“With income growing at a slower pace compared with the cost of living, the M40 and B40 groups are experiencing an abridged disposable income, which could be detrimental to future consumption, activity, emergency or debt services.”

Combining data from the Department of Statistics’ Household Income survey (2016 and 2014) and KRI household reports (concerning population increase), it’s clear that the percentage of households living under the 60% median grew from 2014 to 2016 by 41.8% to 43.5%, with an estimated 2.8 million households in 2014 and three million households in 2016.

The increase also suggests that more M40 households have slipped into the B40 category – and this is where the alarm bells go off.

In the 11th Malaysia Plan (2016-2020), targeted subsidies, cash handouts, healthcare benefits, education, along with employment and entrepreneurship opportunities, include the usual strategies to ease the burden of B40 households.

One of the major concerns among the young M40 family is that they can no longer afford to buy a “middle class” home, and the difficulties have been aggravated by how they need to live relatively close to their workplace.

As much as the government expects housing developers to build affordable houses, let’s not forget that most of these developers have bought land at premium prices, and as private concerns, they still need to make profits.

But homes in Malaysia have become “seriously unaffordable” by international standards, and there’s no need to point fingers at developers when the governments have basically failed to do the job, unlike Singapore’s Housing Development Board (HDB), which builds and upkeeps flats that don’t degenerate into urban slums.

Their HDB flats are so well-designed and maintained that they can pass off as high-end apartments by Malaysian standards.

Bank Negara reported that from 2007 to 2016, house prices grew by 9.8% while household income only increased by 8.3%. While developers blamed rising construction costs – including labour outlay – and stagnant salaries for the increase in house prices, all this means nothing to the M40, because ultimately, they still can’t buy houses.

The rent-to-own scheme which the B40 has enjoyed from the low cost houses, needs to be extended to the M40, so they, too, can enjoy the same benefits, and while such help is expected to come via PRIMA Corp, a federal government-linked developer which supposedly caters for M40, it’s still falling behind schedule.

While it could be easy for the M40 to request more support, including allowances for school-going children, and even free student passes for public transport, it’s time that financial literacy be introduced at school level. A study by S&P Global Literacy Financial in 2014 showed that the financial literacy rate in Malaysia is only at 36%, compared with 59% in developed countries.

“The low financial literacy rate is among the factors that has contributed towards high levels of debt – including worrying bankruptcy problems – among the youth.

“Between 2013 and 2017, a total of 100,610 Malaysians were declared bankrupt, of which 60% were between 18 and 44 years old,” according to Finance Minister Lim Guan Eng.

Apart from the youth, Lim noted that older Malaysians are also facing serious financial challenges, particularly when it comes to their retirement.

Based on estimates by the Employees Provident Fund (EPF), he said that as of 2019, an individual requires savings of at least RM240,000 by age 55 to retire comfortably.

However, based on the EPF 2017 Report, active contributors aged 54, have average savings of only RM214,000 in their accounts.

“What is even more worrying is that two-thirds of contributors aged 54, only have RM50,000 and below in their EPF accounts in 2015,” he reportedly said, adding that this was well below the recommended amount for savings.

Lim noted tha the low amount of savings was inadequate and estimated it to run out within five years of retirement, although the average life-span of Malaysians is 75.

Basically, the B40, M40 and, our young and old Malaysians, are all either grappling with financial problems, don’t know how to handle their money, or don’t even earn enough in the first place.

This is unlike the situation for the T20, which has disposable income where their wealth encourages investment and wealth creation, the main principles of the T20 group.

But of all people, politicians should know the importance of the people wanting to have money in their pockets and feeling well heeled.

Easier loan payments, good refinancing packages and transport allowances should be considered to help the M40.

If the market continues to slide, there will be many unhappy people, and the resentment will translate to protest votes. For them, it simply means the government is doing a lousy job, and they couldn’t care less for the reasons, however valid they may be.

Wong Chun Wai

Wong Chun Wai began his career as a journalist in Penang, and has served The Star for over 27 years in various capacities and roles. He is now editorial and corporate affairs adviser to the group, after having served as group managing director/chief executive officer.

On The Beat made its debut on Feb 23 1997 and Chun Wai has penned the column weekly without a break, except for the occasional press holiday when the paper was not published. In May 2011, a compilation of selected articles of On The Beat was published as a book and launched in conjunction with his 50th birthday. Chun Wai also comments on current issues in The Star.


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What concerns Malaysians most ?

Supermarket shopping food

THE biggest concern among Malaysians, as we head towards the general election, is the cost of living. It’s as simple as that.

There have been plenty of political and religious side shows, but for many Malaysians, regardless of race, settling the many bills each month is what worries them the most.

Although Malaysia remains one of the cheapest countries to live in, its citizens have been spoilt for too long.

We are so used to having so many food items subsidised, including sugar, at one time, to the point that some of us have had difficulties adjusting ourselves.

Our neighbours still come to Malaysia to buy petrol, because ours is still cheaper than theirs.

But, as in any elections, politicians will always promise the heavens to get our votes. One of the promises, we have already heard, is the abolishment of the Goods and Services Tax.

No doubt that doing away with GST would appeal to voters, but seriously, even the opposition politicians calling for this are aware that it is a counter-productive move.

In the words of Tan Sri Mohd Sheriff Mohd Kassim, a highly-respected retired government servant, “it is too much of a fairy tale.”

The danger, of course, is that populist electoral pledges are always appealing, even if they are not rational.

Malaysia cannot depend on just about two million tax payers to foot the bill in a country of over 30 million people. It is unfair and unsustainable.

Taxing consumption gives more stability to revenue because income tax is regarded as highly volatile, as it depends very much on the ups and downs of businesses, according to Mohd Sheriff. When the market is soft, revenue collection always sees a dip.

For the government, which has already been criticised for having such a huge civil service, without GST, it could even mean its workers may not get paid when there is a downturn in the economy.

In the case of Malaysia, we have lost a substantial amount of revenue following the drop in oil price.

So, when politicians make promises, claiming plugging leakages is sufficient to end GST, it is really far-fetched and irresponsible.

The Malaysian tax system needs to continue to be more consumption-oriented to make it recession-proof, and, more importantly, the tax net just has to be widened. The bottom line is that, it is grossly unfair for two million people to shoulder the burden.

The government has done the right thing by widening the tax base and narrowing the fiscal deficit. The move to implement GST, introduced in 2014, has been proven right.

GST is needed to provide a strong substitute as a tax consumption capable of off-setting revenue loss from personal and corporate tax.

Beginning next month, India will join nearly 160 countries, including Malaysia, in introducing GST. Like Malaysia, when GST was first introduced, plenty of loud grumblings and doubts have rolled out.

Unlike Malaysia’s flat 6% across the board, India is introducing a more complicated four-tier GST tax structure of 5%, 12%, 18% and 28%, with lower rates for essential items and highest for luxury and demerits goods that would also attract additional cess. In Singapore, GST was introduced on April 1, 1994, at 3%. The rate was increased to 4% in 2003, then 5% in 2004. It was raised to 7% on July 1, 2007.

Some politicians came under fire recently for purportedly calling for the abolishment of GST, however, some others clarified that they had merely called for a reduction in the tax’s percentage.

Another top opposition politician has come out as the strongest opponent of GST, reportedly saying the claim that Malaysia needs GST is false.

Some other politicians have described GST as regressive, but have not come out with clear ideas on how it should be tackled.

Nonetheless, the ruling party should not make light of these electoral promises.

For many in the urban middle class, they feel the squeeze the most.

They have struggled against the rising cost of living, paying house and car loans, and earning deep levels of debt, as one report aptly put.

The middle class, consisting of over 40% of Malaysians, is also in the income tax bracket, it must be noted.

Last year, an economist was quoted saying that 2016 was a year of a shrinking urban middle class and a happy upper class.

Shankar Chelliah, an associate professor at Universiti Sains Malaysia, said that the Malaysian middle class shrank in metropolitan centres across the country, and that most of its members would end the year almost 40% poorer than they were in 2015.

He said this would be due to the withdrawal of cooking oil and sugar subsidies, depreciation of the ringgit, decrease in foreign inflows and increase in outflows, among other factors.

For many in this middle class range who do not qualify for BR1M handouts, the government clearly has to come up with a range of programmes which can relieve them of these burdens.

It isn’t race or religious issues that will appeal to voters – they want to know how they can lead better lives, and if the opposition thinks contentious issues will translate into votes, they will be in for a surprise.

It is true that the heartland will continue to deliver the crucial votes, and the ruling party will benefit from this, but Malaysia has also become more urban and more connected.

At the end of the day, it is the bread and butter issues that matter most. Let’s hear some solid ideas and programmes which will reduce the burden of Malaysians.

By Wong Chun Wai On the beat, The Star

Wong Chun Wai began his career as a journalist in Penang, and has served The Star for over 27 years in various capacities and roles. He is now the group's managing director/chief executive officer and formerly the group chief editor.

On The Beat made its debut on Feb 23 1997 and Chun Wai has penned the column weekly without a break, except for the occasional press holiday when the paper was not published. In May 2011, a compilation of selected articles of On The Beat was published as a book and launched in conjunction with his 50th birthday. Chun Wai also comments on current issues in The Star.

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America, a "Generation of Sissies"

The “elephant in the room”— one big question in the minds of so many Americans is—“Why has the middle class in America lost so much ground, and when will it recover to earn better wages (and close the gap between the top earners and the middle class)?”   The answers are brutally simple:  ”Because America’s middle class became non-competitive globally,” and, “Not until American middle class workers—and the kind of work they do—become globally competitive again”   There are two huge problems facing the America in the future:  one is demographic, the other is cultural.

America (Photo credit: acb)

1)  “Baby Boomers” are retiring from the work force at the rate of 10,000 per day, and will do so for 17 years.  Most of them don’t have enough pension or 401(k) assets to support retirement for their life expectancy (15-20 years).  Too few employers will hire these older folks, with their potential problems of age—reduced stamina and more health-related problems (and higher health care costs).

2) In recent decades, American parents have raised a “Generation of Sissies”—of spoiled, lazy, pampered and over-rated youth—who are highly educated, but in things that the world doesn’t value very much (and thus won’t pay for).  The top 25% may be as good, as bright, as motivated as ever, and will likely be as successful as ever.   The vast majority of this generation consists of formally educated, but spoiled, soft post-adolescents, who will struggle to be self-sustaining as adults.  Because of this, they will not be able to support the massive wave of retired “Boomers,” who will be going broke in their later years.  In eras past, the elderly were supported by the coming younger generation(s).  Those days are gone.

Members of this “Generation of Sissies” have been the victims of being coddled, babied, pampered, misled, misguided, and under-educated so badly that their “take care of me” upbringing cannot be sustained as they move into adulthood.   The parents, who did this, also share in the responsibility for the failure of America’s educational system.

I won’t lay all the “blame” for these failures on American youth—although they have been willing accomplices.  Parents and educators failed to prepare them for adult life in the cold harsh world, and where they must compete for gainful employment.  Then the youth chose easy and fun majors in college; not the ones in that are in demand by employers.  Thus they can’t find jobs, or certainly not good paying jobs.

For too long, American parents have also abdicated the responsibilities for educating and raising their children to a cadre of teachers and educational institutions ill suited for the task at hand.  Parents used to prepare children to take care of themselves—sort of an apprenticeship in becoming an adult.  Along the way, they used to teach them, and demand of them, that they learn critical personal skills, and useful, responsible habits—like earning your own way in life.  Not any more.

Now, because of globalization the jobs have gone to wherever qualified workers will do them for the least pay.  American workers have fallen behind global competitors.  Thus, the American middle class, now and for the foreseeable future, will have to “play catch up” —learning new skills and how to apply them—and then employers will have to regain the work that provides the jobs.  Otherwise, the middle class will continue to languish with subpar wages—at least until it becomes competitive again, if that ever happens.  The only part of the middle class with growth prospects are employees of new, small businesses that grow–when they are not stifled by an oppressive government regulations.

Worse yet, is the untimeliness of this “Generation of Sissies,” who think that there are no winners or losers.  They learned this because everyone got rewarded just for participating. Trophies no longer represented hard work and winning to them.  Success meant just being involved and  “showing up”—and sometimes, not even that.  News flash for Americans of this Generation of Sissies: In the cold, harsh world of 21^st century global business there ARE winners and losers—and YOU are losing!

The “Generation of Sissies was victimized by too-busy parents, who abdicated their responsibilities, and tried to pass them off onto schools and teachers.  The teachers were not prepared to handle these new responsibilities.   Add to this the expectations that have been created: “free meals” (government funded, means “free”) that go far beyond the old school lunches; “free transportation” (or being driven to school);  “free extracurricular activities,” and much more.   And for this, all they had to do was“show up.”  Even grades are no longer a dose of reality.  Kinder words replace letter grades, to soften the truth of impending mediocrity.

Schools now teach “softer studies” (some of which used to be taught at home by parents) make up over 1/3 of total credits: “21st century life,” or “career-technical education, or “health, safety, & physical education,” or “visual & performing arts,” and “language arts literacy.”  Many students can’t write a grammatically correct sentence, and some don’t even see the point in learning to write (cursive) at all.  They use Text-messages and Tweets.   Signatures are nearly obsolete.

Schools still require a modicum of Math and Science, but not enough to meet todays employment demands.  In many cases, one 3-credit course (out of 110 credits) is offered on financial, economic, business, and entrepreneurial topics. Teachers are not held to the highest standards either, since doing so would require compensating the best ones more, and removing the worst ones—and teachers’ unions (and tenure) simply won’t allow that.  Today’s youth learn that being late, or absent isn’t so bad, because there is always an “excuse.”  But when they get in the world of work, employers expect employees to show up, on time, every day, and actually work all day.

Then parents pay a fortune (instead of putting it away for retirement) for college because it used to be a sure path to a decent job  (Now students graduate deeply in debt—over $1 Trillion and rising).  A degree in the arts or humanities may have once been the ticket to a job, but it’s not any more!   The youth of today and the adults of tomorrow simply have not been educated in the reality, the necessary skills and the knowledge they need to be competitive and self-sufficient.  Many do not have a clear understanding of how much hard work and  commitment they must invest to ensure their own future.

Too many people  feel sorry for these “underachievers,” even though part of the failure is their own fault.   The “Occupy movement” is filled with members of this “Generation of Sissies.”  They expect someone to “take care of them” and give them what they cannot or are unprepared to earn for themselves.   Who has what that they want?  The very people who worked hard to get a good education, studied, learned, applied themselves and learned to compete.


There will be negative comments about my title: “Generation of Sissies”—as being demeaning.  These comments will come mostly from the very same segment of society that helped create these problems—and still condones them.  To them I say, “Prove me wrong.”  Right now, the results confirm what I have written.  Until America puts the onus for education back onto the people where it belongs—first on youth and their parents, and next on quality schools and good teachers—the American middle class is doomed to remain stuck where it is.  Any other outcome is a delusion.

Can these problems be fixed?  Yes, but it took an entire generation or more to create them, so the fix will be slow and painful–as it is proving to be right now.   There is an even larger question.  It is not, ” WILL AMERICA COMPETE in the global economy of the 21^st century?  It is, “DO AMERICANS HAVE THE WILL TO COMPETE?   Will Americans take the necessary actions to make themselves and future generations competitive.  We can only hope that the answer to this question is YES!

By  John Mariotti, Forbes Contributor
John Mariotti is an internationally known executive and an award-winning author. His newest book, co-authored with D. M. Lukas, Hope is NOT a Strategy: Leadership Lessons from the Obama Presidency is available now at www.amazon.com  in paperback and Kindle, and in other e-book formats at www.smashwords.com 
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What Is the Chinese Dream?

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What Is the Chinese Dream? -- Part II 

Helen H. WangContributor

Helen Wang is a consultant, and the author of The Chinese Dream: The Rise of the World's Largest Middle Class and What It Means to You. Originally from China, Wang has lived in the U. S. for over twenty years. After finishing her masters degree at Stanford University, she joined a think tank in California, where she consulted for Fortune 500 companies including Apple Computer, Oracle, and Bank of America. Wang then became an entrepreneur in Silicon Valley Internet start-ups. In 2004, she returned to Stanford University as a Reuters Fellow, developing technology solutions for under-served communities. A sought-after speaker, Wang currently divides her time between consulting for companies doing business in China and helping non-profit organizations make a difference.

The author is a Forbes contributor. The opinions expressed are those of the writer.

A few months back, I wrote an article “What Is the Chinese Dream” here. In that article, I recounted an incident in which someone asked me: “tell me in one sentence or two, what is the Chinese dream?” I stuttered, and then said, “This is a simple question, but there are no simple answers.”

Since then, I have been thinking about this question, “what is the Chinese Dream?” I feel a little foolish that, having written a book titled The Chinese Dream, I still cannot articulate what the Chinese dream is.

When I speak to an American audience, I often say “the Chinese Dream is like the American Dream” (and this has even offended some of my Chinese compatriots). Yes, the Chinese middle class wants what Americans have – owning a big house, driving a luxurious car, and living a comfortable life.

But many would argue with me that that is not the essence of the American Dream.

Wikipedia defines the American Dream as “a national ethos of the United States in which freedom includes a promise of the possibility of prosperity and success.” American historian James Truslow Adam coined the term “the American Dream” as “life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement.”

My version of the American Dream, which I hope many would agree with, is:  regardless of one’s background, with determination and hard work, one can achieve whatever one aspires to in life.

In order for such a dream to thrive, it needs a system that encourages entrepreneurship, creativity, and diversity. That system must also guarantee equal opportunities, freedom, and rule of law.



During my trip to China in June, I asked Chinese audiences what they thought the Chinese dream was. No one, not a single person, could answer the question. To put it bluntly, China doesn’t have the Chinese dream. Or, there is no “Chinese Dream” that defines China the same way that the American Dream defines America.

This is a serious problem for China. It is like a person without soul, a computer without an operating system, and a ship without a navigator.

In Beijing, a young woman challenged me: “Why do we need a dream?” she asked. True. The Chinese are pragmatic people. Good health, good fortune, and good family are all they need – fair enough.

In writing my book The Chinese Dream, I spoke to over one hundred people in China. They are from all walks of life – entrepreneurs, office workers, rural migrants, and so on.  About half of them said they didn’t have dreams, didn’t bother to dream, or there was no use to dream because dreams and reality are too far apart.

Without dreams, one will lose the source of inspiration and imagination. It is dreams that drive upward mobility, that allow us to see beyond our limitations and achieve what seems impossible.

When I left China 20 years ago, there was no Chinese dream. I had to leave my country and come to America in order to pursue my dreams of a better future. Today, many young people in China can start businesses and they have a lot more opportunities. But many of them still want to come to America. There is still no Chinese dream.

Recently, more and more Chinese middle class families have emigrated to the United States. They saved up enough cash, sent their children to American universities, and bought properties in the States and settled down here.

One might ask “why?” Today, China seems to have all the opportunities while the United States seems to have all the troubles. Yet, the promise of the American Dream is still attracting people from around the world.

What is the Chinese Dream? This question is not only important to China, but also to the rest of the world. Today, China is the second largest economy in the world, a major economic power. What does China stand for, what will China become? People around the world are watching and speculating.

I believe part of the reason that people in the West fear China is that they are not certain whether China will be a benign power or an evil power because they don’t know what the Chinese Dream is.

The United States as a superpower has done many wrong things and bad things in the world. But people around the world in general know what the U. S. stands for. Some people may disagree or resent U.S. foreign policies, but few people see the U. S. as an evil power.

It is time for China to define a new dream. The real Chinese dream has to come from the Chinese people – something that reflects the fundamental values of who they are and what they represent.  It will probably require some deep soul searching of an entire generation or even several generations of the Chinese people to identify the true Chinese dream.

Now my book The Chinese Dream is being published in China. It is my hope that it will not only serve as a bridge between China and the West, but also start an important conversation about the Chinese Dream.
What do you think? Please add your version of the Chinese Dream in the comments area.

 What Is the Chinese Dream? -- Part I

In an event in Silicon Valley, someone asked me: “In one sentence or two, would you tell me what is the Chinese dream?” (as he learned I wrote a book called The Chinese Dream).

A simple question, but no simple answers.

When I left China 20 years ago, there was no Chinese dream. I had to leave my country and come to America to pursue my dream of a better future. But today, many young people in China can start their own business and have a lot more opportunities. Even many of my American friends are going to China because of the tremendous opportunities presented there.

As a Chinese magazine editor told me bluntly, “The Chinese Dream is a copy of the American Dream.”

Many middle class Chinese are influenced by the American way of life. They are bombarded by many material temptations and proliferating choices. TV commercials, the Internet, and Hollywood movies give them a rosy picture of the American middle class.

One Chinese blog described it this way: “American middle class people live in a villa with a two-car garage in the suburbs. In front of the house, there is a green lawn. They have 2-3 children, and a dog. The husband goes out to work, and the wife stays at home taking care of the children. On weekends, they drive their SUVs to the countryside for barbecues and camping.”

That is the picture in most Chinese people’s minds of “the American Dream”— owning a big house, driving a nice car, and having a comfortable life. The Chinese middle class wants it all.

In my book The Chinese Dream, I discuss a wide variety of topics related to a rising Chinese middle class and explore the implications in economics, the environment, culture, and politics. For people who do not have time to read the book, here is a peek:

 he Chinese Dream is organized in two parts. Part One, “The Making of the Middle Class,” reviews the dramatic changes over the past fifteen years in China that gave birth to the new breed of Chinese middle class that is still emerging.
 
The Introduction, A Five-Thousand-Year Dream, provides an overview of the Chinese middle class and presents the main theme of the book—that the rise of a large Chinese middle class will be a complementary and balancing force in the global community and benefit the world as a whole.

Chapter 1, A Peculiar Private Sector, explores a topic that mystifies many people in the West: how capitalism and communism, two mutually exclusive systems, can exist side by side in China. Through profiles of a state-created bourgeoisie and a communist entrepreneur who wears Playboy shoes and invests in the capitalist stock market, among others, I show how China’s not-so-private sector operates. In reflecting on this complexity of Chinese society, I discuss the differences between Eastern and Western ways of thinking and how they, although seemingly contradictory, can be complementary to each other.

Chapter 2, Collective Identity Crises, looks at the impact of globalization on the urban Chinese middle class, known as “white collars.” Among them are a recruiter who gave up her dream to be a reporter, a gay son of former Red Guards, a blogger who drinks Starbucks coffee and studies American business icons, young entrepreneurs who are becoming increasingly westernized, consuming as fast as the money pours in, and many more. Their stories are a microcosm of modern China, full of the contrast of past and present, the conflict of old and new, and collision of East and West.

Another major factor in the growth of the Chinese middle class is the country’s unprecedented urbanization. Chapter 3, The Greatest Migration, features rural migrants who pulled themselves up out of poverty, examines the reasons for this great migration, and discusses potential obstacles—such as China’s rigid household registration and educational systems—to the Chinese middle class’s ability to move up. In this chapter, I also debunk the myth of China’s manufacturing power and challenge people in the West to see beyond our own immediate interests and view China as an opportunity, rather than a threat.

Part Two, “Complexities and Challenges,” discusses the impact of the Chinese middle class on Chinese society, the United States and the rest of the world, how it will change the dynamics of the planet we live in, and why it can lead to a safer and stronger world.

Chapter 4, An New Economic Engine, explores the economic implications of a large Chinese middle class, both for China and for the world. A burgeoning middle class, calculated to reach 600 to 800 million within the next fifteen years, is jumping aboard the consumerism train and riding it for all it’s worth—a reality that may provide the answer to America’s economic woes. The chapter presents ways Western companies can capitalize on China’s enormous consumer market, and argues that the Chinese middle class will be an alternative growth engine for the global economy. As counterpoint to this argument, I deconstruct the myth of China as a superpower.

Although a large Chinese middle class offers significant benefits for the world economy, it will also pose serious challenges to the environment and global warming. Chapter 5, Environmental Megachallenge, showcases China‘s widespread pollution and looks at both the challenges and opportunities presented by this environmental crisis—problems that the U. S. can help solve. The chapter discusses both the bottom-up environmental movement in the West and the top-down governmental approach in China and presents a case for mutual learning and collaboration.
 
Twenty plus years after Tiananmen Square, will a growing Chinese middle class push for more democracy? In Chapter 6, Democracy or Not Democracy, That Is the Question, I review China’s troubled history of democratic pursuit and interview a former Tiananmen Square demonstrator, an editor for one of China’s outspoken magazines, and other intellectuals and entrepreneurs. The chapter discusses the relationship between the Chinese middle class and the government, and explores the possibility of a democratic China.

China is leapfrogging into the information age. Chapter 7 , Looking at the World Upside Down, tells the story of a Chinese Internet entrepreneur who started an e-commerce company that defeated eBay in China. This chapter documents why some companies fail while others thrive in the Chinese market, and illustrates important lessons that multinationals cannot afford to ignore when seeking to do business in China.

China is experiencing a surge in religious beliefs as the country continues to undergo rapid and profound changes. Chapter 8, Unquenchable Search for Meaning, recounts stories of people’s search for spirituality and their desire to find meaning in life: a jewelry store saleswoman wavering over believing in God, a public relations manager shopping from religion to religion, an entrepreneur who converted to Christianity but is still in doubt, and others. The chapter delves into the government’s attitude towards religion and the middle class’s quest for balance between material and spiritual enrichment.

The book’s Conclusion, From the Chinese Dream to One World One Dream, asserts that middle class Chinese and Westerners are connected by a common set of core values and share many of the same aspirations and dreams. By accepting our interdependence and seeking to learn from each other, we will all benefit. The Chinese middle class is an emerging global force that can serve as a catalyst for a more balanced world for all.

Interspersed throughout are my personal stories and life-changing experiences—my childhood in China, my arrival in the United States, and my visits back to China over the years.

If you have a better definition of the Chinese Dream, please let me know.
(Helen Wang is the author of The Chinese Dream: The Rise of the World’s Largest Middle Class and What It Means to You. Available on Amazon and http://TheChineseDreamBook.com)

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