Microtrends the small fo.., p.35

  Microtrends_The Small Forces Behind Tomorrow’s Big Changes, p.35

Microtrends_The Small Forces Behind Tomorrow’s Big Changes
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  Imagine if people in China were to stop drinking tea; or the Japanese were to forego sushi. The dislocations would be cataclysmic. Such are the problems created by the French drinking more Perrier than Pomorol. First, the French vineyards—as rich a part of French cultural identity as Disney World is to the U.S.—are in desperate straits. Having failed to prepare for either the decline in domestic demand or the upstart wine producers in other countries, French winemakers have found themselves with a glut of Côtes du Rhône and grapes rotting on the vine. The crisis has sparked violence with police and triggered heavy government aid packages. French wine merchants used to be elite entrepreneurs, the guardians of French gustatory standards. Now they are the ones rioting in the streets. As of 2006, the European Commission was considering dramatic new ways to reverse the vintners’ slide.

  Second, while the decrease in wine consumption will likely do good things for rates of French alcoholism, cirrhosis, and other alcohol-related diseases, one might also expect adverse health effects, if the claims about the healthfulness of red wine are true. While no one knows for sure if red wine decreases heart disease, the theory has been out there for decades, and France’s low rates of coronary disease despite its high-fat diet have certainly fed the mystique. But now, with half as much wine consumption as forty years ago, this will be a real test of the theory—heart attacks should increase, and if they don’t, it could reverse one of the great drivers of worldwide growth in red wine consumption.

  Of course, some people can benefit. If you are an American entrepreneur, it might not be a bad idea to scoop up some cheap French wine and smack on some labels announcing “REAL FRENCH WINE” for under $10 a bottle. Some people in America will still be very impressed.

  And if you are a young, growing French family, you are saving money—many euros a day—by drinking less wine, and you are likely putting that cash into modern conveniences and a rising standard of living. You are also probably contributing more to the gross national product, able to do a lot more work because you have more hours per day at peak alertness.

  But if you are a French vintner, you are facing the opposite—a lot more time on your hands, and fewer euros in your pocket. Maybe you even take a few extra drinks just to get through the day. All the while lamenting, “Just what has happened to the ancien régime?”

  Chinese Picassos

  There are a couple things everybody knows about China. First, it’s a budding economic superpower, with 1.3 billion people—over 500 million of whom are projected to be middle-class by 2010. The sheer size of the market is staggering.

  Second, especially here in the U.S., we know that because of China’s intense focus on science and engineering, it is turning out hundreds of thousands more undergraduate science majors than we are—and rapidly gaining on us in terms of graduate degrees in science and engineering, too.

  It may surprise you to learn, therefore, that China is increasingly an art superpower, too. Between 1993 and 2005, China’s premier art auction house nearly quadrupled its annual sales volume, from under $2.5 million to $10 million. According to Chinese gallery-owners, domestic demand for Chinese art has grown nearly 10-fold in recent years, and is expected to keep climbing. This is, of course, a reflection of that booming Chinese middle class—who now not only have walls to decorate and fortunes to flaunt, but also want someplace other than the volatile Chinese stock market to put their money.

  Yet growing Chinese interest in art—enormous as it is for the Chinese themselves—is not the end of the story. This is a global explosion. Since the 1980s, the price of contemporary Chinese oil paintings on the world market has skyrocketed, in some cases by as much as a 100-fold. Between 2004 and 2006 alone, Sotheby’s and Christie’s increased their Asian (mostly Chinese) contemporary art sales worldwide from a mere $22 million to a stunning $190 million. Suddenly, Chinese art is one of the hottest things on the international scene.

  Not bad for a country that just a few years ago required all “art” to expressly glorify the Communist Party—right? What happened?

  First of all, China used to lead the world in many kinds of art, like calligraphy and, of course, the porcelain most of us in the West call, simply, “china.” But the twentieth century was a low period, what with the communist repression of most forms of artistic expression. After the death of Mao Zedong in 1976, there was a temporary flowering of art, with artists venturing forth in a kind of nervous, avant-garde style of painting—but in 1989, the “China/Avant Garde” show at the National Gallery in Beijing was shut down by the government within weeks of opening. A few months later came the Tiananmen Square massacre, and many artists fled their homeland or abandoned art entirely.

  Only slowly, over the 1990s, did Chinese art trek back. In 1992, the communist authorities legalized the private art market and began to ease up on censorship. By 1995, Chinese artists were on display at the Venice Biennale, a major worldwide show of contemporary art; and in 1996, Americans flocked to New York’s International Asian Art Fair. In 2004, as part of its obligations as a member of the World Trade Organization, China opened its doors to foreign auction houses; and by 2006, Sotheby’s and Christie’s had the record-breaking sales of Chinese art mentioned above (although still mostly outside the mainland). Today, the Chinese government affirmatively cultivates international art stars.

  Now when you think Chinese art, don’t just think pastoral scenes, with those exotic ink brushstrokes. The biggest Chinese painters today present full-scale studies of musicians, prostitutes, families, and acrobats, as well as richly abstract canvases. Some of the edgier ones depict red babies floating through postindustrial landscapes, or yaks cartwheeling across railway lines. And many have become household names around the world, as well known as contemporary Western stars like Damien Hirst and Jeff Koons. Forty-three-year-old Liu Xiaodong of Liaoning Province sold his A Man with Two Women to a Chinese entrepreneur for a record-breaking $2.7 million in November 2006. Around the same time, Zhang Xiaogang, 48, of Yunnan Province, known for his photograph-like paintings of the Cultural Revolution, sold his Tiananmen Square for $2.3 million at Christie’s in London.

  And it’s not just painting, either. The New York–based Cai Guo-Qiang, born in 1957 in Fujian Province, is best known for casting a rainbow across the East River to celebrate the opening of the temporary Museum of Modern Art in Queens, and for exploding a powder-based dragon across the Thames. Chinese painting, film, video, photography, and performance art have become some of the most innovative in the world.

  Maybe we—especially in America—shouldn’t be surprised. One of our own Founding Fathers, John Adams, once wrote to his wife, Abigail, that he “must study Politicks and War, that my sons may . . . study . . . Commerce and Agriculture, in order to give their Children a right to study Painting, Poetry, and Porcelain.” So maybe it’s the natural progression that war gives way to commerce, and commerce gives way to art. Perhaps China’s flourishing markets, entrepreneurs, and scientists—rather than being inconsistent with a booming art presence—are art’s natural breeding ground.

  The implications are big, as is everything in China. The growing class of Chinese artists is in the millions—including the 20-somethings who sell their photographs to eager Western scouts for $10,000 a pop; the 30- and 40-somethings who were born during the Cultural Revolution and now create at the crossroads of, as one observer has said, “an authoritarian regime and rampant consumerism”; and the 50- and 60-somethings who came of age during the Cultural Revolution, and now have the perspective, and some freedom, to criticize it.

  There’s even a big market for mass-art production, and reproduction. A Chinese town called Dafen, just outside the southern city of Shenzhen, houses hundreds of oil painting shops, wherein thousands of assembly-line workers can re-create for you in minutes whatever masterpiece you want—Chinese or foreign, classical or contemporary. Talk about the entrepreneurial foundation of artistic expression.

  Look for a booming industry of Chinese art merchants, marketers, middlemen, and, of course, fakes. State cultural authorities had to pass a law in 2003 requiring all auction houses and personnel to undergo annual examinations to guard against fraud in the enormous but nascent art market.

  And viewers are booming, too. Young Chinese apparently love the burgeoning art galleries, making art-browsing one of the fastest-growing pastimes in China. And as a result, both the U.S.’s Guggenheim Museum and France’s Pompidou are looking to open branches in China.

  Yes, some of the market has yet to mature, both in terms of artists’ freedom and buyers’ tastes. The government still censors some work, especially if it deals with contemporary politics, and it is disinclined to allow much homemade art to leave the mainland. From the buyers’ and critics’ side, too, there is some refinement to be had—some galleries still pay painters purely by the size of the canvas.

  But my sense is that the surge of Chinese artists is good news for everyone. Not just the creative Chinese, who have won back some freedom to express themselves aesthetically; and not just the layers upon layers of Chinese and international art merchants who will build businesses to match the interest. And not even just the people of all nations who may now be able to relate to more Chinese citizens on more levels. No, the art surge is most importantly good news for China—if the incremental liberation of artistic expression signals an expansion of other political and economic freedoms as well.

  During the Cold War, Czech poet and playwright Václav Havel used art, before he used politics, to challenge the communist government’s grip on his country. In a series of internationally acclaimed plays, Havel cried out for a free and open Czech society. In 1989, Havel became president of the newly democratic Czechoslovakia (and later the Czech Republic)—and without violence. Some day, Chinese artists may herald a new chapter of not just artistic, but also economic and political, reforms in China.

  And last, if you want to get in on the ground floor of some budding art communities, go to where business—regular business—is booming. John Adams may have thought he was just musing to his wife about his personal family legacy, but he was also making a keen observation about society. China’s size, and its rich history of aesthetic innovation, may make it an exceptionally good place for art to flourish right now. But other countries whose GDPs are also rising steadily include Azerbaijan, Estonia, Trinidad and Tobago, and Ghana. Maybe that Estonian expressionist you’ve been admiring is actually also a great investment. And, of course, Vietnam.

  Ask the Medicis—where there’s prosperity, there is probably art. And where there is prosperity and rapid social change, there may well be important, powerful, even transformative art.

  Russian Swings

  This trend is about the middle of the Russian electorate. It’s about Russians who, in the 1990s, swung toward democracy, and now are swinging back. They not only hold the future of Russia in their hands, but they tell us something important about democracy versus prosperity, which, in the West, we often assume go hand in hand.

  The late 1980s were heady days for Eastern Bloc democrats. The Polish Solidarity movement was having real, bilateral talks with its communist government; Hungary was instituting multiparty elections; and the East Germans were marching in the streets for the right to travel. Then the Berlin Wall came down, and the Communist Party ceded power in Czechoslovakia, Romania, Bulgaria, and Albania. In 1990, East and West Germany rejoined, and finally the Soviet Union itself dissolved.

  Russians were hopeful. After seventy-five years of communist rule—and centuries of autocratic czars before that—a majority of Russians told the 1991 Pulse of Europe Survey that they thought their country should rely on a democratic government rather than a strong leader to solve the country’s problems. Among young Russians, aged 18–34, nearly 6 in 10 said they favored democracy over a strong hand. The promise of both economic and political freedom was powerful, thrilling, and forward-looking.

  And by many measures, Russians’ hopes have been borne out. After an initial depression in the 1990s, Russia’s economy has now grown eight years in a row, surpassing the average growth rates of all other G8 countries. Thanks to rising energy prices and Russia’s huge reserves of oil and natural gas, Russian incomes are rising, consumer credit is widely available, the stock market is booming, and consumer demand is growing. The emerging Russian middle class has swelled to between 40 and 50 million people. In this sense, the fall of communism was a great, pro-democratic, even pro-capitalist success.

  But today, Russians are telling global pollsters some surprising things. According to the Pew Global Attitudes Project, which inherited the 1991 Pulse of Europe Survey, only 28 percent of Russians now favor democratic government over a strong leader—down from 51 percent in 1991. (In 2002, the percentage favoring democratic government sank as low as 21 percent.) A remarkable 81 percent of Russians—including every demographic subgroup—now say that a strong economy is more important to them than a good democracy.

  To put this shift from democracy to strong leader in perspective, Pew compares the Russian shift to trends in the Muslim world, where authoritarian rulers are commonplace. In five out of six predominantly Muslim countries—Morocco, Lebanon, Turkey, Indonesia, and Jordan—majorities of respondents say they would prefer that democratic institutions solve the country’s problems than a leader with a strong hand. Which would you have thought would be more committed to democratic rule—those Muslim countries, which most Americans probably couldn’t find on a map—or our European ally Russia, to whom the U.S. has furnished almost $2 billion in aid since it did away with communism more than fifteen years ago?

  What seems to be emerging is the Russian Swing Voter. The voter who used to march for democracy, but now strongly favors a strong ruler with concentrated power.

  Who this voter is is critical to the future of Russia. He is a he, for starters. According to Pew’s analysis, Russian men were the biggest democracy boosters in the early 1990s—favoring democracy over a strong leader 58 to 35 percent, compared to women’s more lukewarm support of 46 to 42 percent. But now, about two-thirds of all Russians—men and women—prefer the strong leader.

  Second, Russia’s new Swing Voters are largely the young people who were at the forefront of the pro-democracy movement in the early 1990s. Whereas nearly 6 in 10 Russians aged 18–34 favored democracy then, now those same people, having aged to their 30s and 40s, have switched, favoring a strong leader by an even wider margin (66 to 29 percent).

  Also, money has something to do with the swing. The lowest income group in Russia has the least remaining faith in democratic forms of government.

  Disillusioned, male, and not quite middle-class. The Swing Voter is he who sees the rising gap between rich and poor, and knows he’s on the wrong side. He who is disappointed in Russia’s school systems; its miserable public safety (fewer than 3 in 10 Russians feel safe on the streets); and its widespread corruption (in 2006 in Moscow alone, 40 percent of poll respondents said they had given a bribe in the last twelve months). This is Russia’s swing vote.

  Of course, the vote of any sort in Russia is being challenged these days. Probably buoyed by the very surveys that show Russians like strong-man leadership, President Vladimir Putin has replaced regionally elected governors with his own appointments; proposed ending mayoral elections; made it harder for new political parties to form and register; and harassed the umbrella opposition group—known as Other Russia, led by chess great Garry Kasparov—practically to extinction. As a St. Petersburg party leader told the New York Times in early 2007, “I would not call the process underway in our country democracy.”

  Nonetheless, there is deference to popular opinion. Polls and surveys still matter to Putin, who surely watches his own approval ratings, now in the high 70s, with glee. Putin conducts occasional, live Q&A sessions with the Russian people over e-mail and telephone to hear concerns and share plans. While it is widely understood that Putin will handpick his 2008 successor (unless he circumvents the constitution to give himself a third term), observers also say that he began floating candidate trial balloons as early as 2006, to be sure that his choice will be well received.

  So Russia is at a crossroads. On the one hand, President Putin seems inclined to make Russia an “autocratic petro-state,” as one observer has called it, and to assume the mantle of the global opposition movement to the United States. His February 2007 speech in Munich was described as “the most aggressive speech from a Russian leader since the end of the Cold War.”

  But on the other hand, Russia’s voters—including the swings who once supported democracy—have the power to urge their leaders to remember the growing middle class, attract and not repel more foreign investment, and permit more economic and democratic freedoms. Yes, they were disillusioned by the post-communist depression in the 1990s, and while they appreciate the economic growth under Putin and are impressed by his strength, there is also a growing sense that they’re concerned about it, too. Since 2002, those who favor democracy over a strong leader have climbed from 21 percent back up to 28 percent. In fact, in a 2006 survey, nearly half of Russians said they were at least somewhat worried that their president “might try to establish a severe dictatorship, relying on the security forces.”

  So the Swing Voters can help steer this country through its crossroads. And while American swing voters are aging Soccer Moms, the Swing Voters in Russia are rugby men. They don’t mind some fancy footwork with the democracy ball. If anything, these Russian voters reinforce what we are finding all around the world—that people want economic freedom first, and democratic institutions second, once there’s a little prosperity. New institutions of democracy have a way of becoming bogged down while developing countries, courageous enough to try liberalizing their economies, need to demonstrate some fast results. And so even in places like Russia, where there is a history of brutal, tyrannical government, the Swing Voters are choosing saving the economy over saving democracy. But if democracy is to gain as well, it will be at the hands of the quintessential democratic tool, the swing voter.

 
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