by Roseann Lake
First of all, she knows his family would give her a hard time because she’s not from a similarly affluent background. Even the faintest risk of a disapproving mother-in-law does not delight Ivy, whose ideal has always been to marry into a family with more deceased members than living. She had already achieved financial security—for herself and for her parents—although marrying into such wealth would bring her security to a new level, which means a great deal to her. To test the waters, Ivy agreed to accompany the man asking for her hand on a holiday to the Maldives.
The journalist James Palmer once brilliantly referred to mistresses as “the Robin Hoods of the bedroom.” By this, he meant that they took from the wealthy to give to the poor—the “poor,” in this case, being themselves, but also their families. Likewise, in Red Lights: The Lives of Sex Workers in Postsocialist China, Harvard scholar Tiantian Zheng went undercover as a karaoke hostess in the Chinese province of Dalian, conveying to her readers a very unique interpretation of the entertainment and sex trade in China. All of her hostess colleagues at the karaoke bar were women from underprivileged backgrounds who through a combination of sex work and more regular companionship (being a mistress of sorts) had become the economic motors of their families. They’d use the tips and gifts they received from male clients to pay for medicine, clothing, housing, or whatever else their families needed. “A woman’s virtue in China comes not from how pure she is, but how filial she is,” goes an old Chinese saying. In the case of many mistresses, I was starting to think it might just be true.
The second time I went to Maxim’s—the French restaurant that doubles as one of China’s premiere destinations for extravagant marriage proposals—was with Ivy. As we sat down, she asked me to take a subtle survey of the people sitting around us. I did, and noticed a pattern: there were many young, attractive Chinese women. Some were sitting in small klatches, others with older women—their mothers, perhaps? There was even a woman in the corner with a teenage girl clearly too old to be her daughter, but perhaps a little sister. Ivy confirmed what I suspected: most of these women were mistresses.
I run this discovery by one of the restaurant’s managers, Corentin Daquin, who happens to be a friend. “Ah oui bien sûr,” he says. “In addition to being famous for our marriage proposals, we are famous for our mistresses.”
My conversation with Daquin also reflects many of the things I’d previously discussed with Dr. X. Namely, that mistresses were not foolhardy faineants but savvy, sultry movers and shakers who have expertly hornswoggled their men into getting exactly what they need from them. “Many of them are supporting their parents—the older women you see with them are their mothers, the younger ones, their little sisters—entire families profit from their relationships,” Daquin explained.
He mentioned that many of the women who frequented the restaurant were the mistresses of its shareholders. “They all drive luxury cars and treat the restaurant as if it’s theirs,” he says. “But they’re always extremely polite and on point. I know many of them by name—they make their own reservations and also call on behalf of their gentlemen. I rarely hear from any wives.”
Dirty Deeds
Following a reporting trip to India, I had lunch with a Chinese friend named Elliott. As a well-traveled and ambitious adviser at an international private equity firm in Beijing, he was always an excellent source of insight into China’s booming e-commerce market. Halfway into our meal, we began chatting about Indra Nooyi, the CEO of Pepsi. I mentioned that I had recently read an interview with her describing the day she found out that she had been made CEO of an American multinational. As she pulled into her garage around ten p.m. after a long day at work, her mother asked her to go back out and buy some milk. Why hadn’t her mother asked her son-in-law, who had been home since eight p.m. to get it? He was tired. One of the hired help? She had forgotten to ask. So instead, Indra went out for milk and when she got home, banged the carton down on the counter as she told her mother the big news of her promotion. “You might be president of PepsiCo. You might be on the board of directors,” responded her mom. “But when you enter this house, you’re the wife, you’re the daughter, you’re the daughter-in-law, you’re the mother. You’re all of that. Nobody else can take that place. So leave that damned crown in the garage.”
Curious to get a Chinese man’s take on this situation, I asked Elliott what he thought. “In China we would not have that problem,” he said very matter-of-factly. “Because that woman would already be divorced.”
He then rattled off a list of his former female bosses who were all divorced, single moms working deliriously long hours in the highest stratospheres of finance. “They often bring their children into the office,” he said. He seemed unfazed and shrugged as if to say that this was the will of the universe.
In 2016, Beijing surpassed New York to become the billionaire capital of the world. This shift happened thanks in no small part to China’s rising number of self-made female billionaires, which today account for more than two-thirds or 93 of the 124 self-made female billionaires on the planet. True to Elliott’s observations, a fair share—though not all—of China’s wealthiest women are divorced, but perhaps more interestingly, their average age hovers around forty-six, which means they were born in the thick of the Cultural Revolution. While it’s impossible to say how much the more gender-neutral circumstances of their youth contributed to their eventual success, it’s worth noting that more than half of China’s self-made women billionaires have made their fortunes in the traditionally male-dominated fields of real estate, finance, and manufacturing.
Beyond what Chinese women have been able to earn on their own, it’s equally important to consider that more women in China are inheriting their family’s wealth. One of the most prominent cases of a female heir inheriting a huge sum of family wealth is Yang Huiyan, the vice chairwoman and largest shareholder of property developer Country Garden Holdings. When she was twenty-five, her father, Yang Guoqiang—a rice farmer and part-time bricklayer who made his fortune by buying up and developing vacant plots of land in his native southern province of Guangdong—transferred 70 percent of the company to his daughter. This was in 2007, shortly before the company’s IPO on the Hong Kong Stock Exchange. Now in her mid-thirties and worth nearly $8 billion, Huiyan is the youngest female billionaire in the world and the richest woman in Asia.
Since middle school, Guoqiang had been grooming Huiyan—the second of his three daughters—to play a key role in the family business. She started participating in board meetings at an early age, and got a degree in marketing and logistics at Ohio State University. When she returned to China, Huiyan worked as the purchasing manager of her father’s company before being appointed executive director a year later.
Curiously, Huiyan married at age twenty-four, or just one year before she inherited her father’s fortune. Some believe this is because Huiyan’s father did not want to risk his daughter marrying a man who would hijack the family’s fortune or muscle his daughter out of her role at the helm of it—think Matthew Crawley in Downton Abbey. To minimize this risk, Huiyan’s husband, Chen Chong, is said to have been carefully chosen. The pair met on a blind date. He held a PhD from China’s elite Tsinghua University, and like Huiyan, had also completed his undergraduate degree in the United States. The son of a senior official from a northeastern province, his pedigree was considered to be a good match for Huiyan’s money. His more academic proclivities suggested that he would be less likely to interfere with the family business, and the fact that he had been educated at China’s top university would bring added prestige to Huiyan, who despite now being well educated and supremely wealthy, was born into a family of farmers.
The logic used to justify the socioeconomic compatibility of Huiyan and her husband is telling of a shifting tide on the Chinese marriage market. Although in order to be considered marriageable, Chinese men are largely still expected to own a car, a home, and have a sizable amount of savings, Chinese women—either through
inheritance or their own hustle—are increasingly in possession of these three things too. The result is what economists Xiaobo Zhang and Shang Jin-Wei have referred to as a “tournament effect,” or the idea that just as men must strive to attain conspicuous signs of wealth in order to more favorably position themselves in the marriage market, women, by doing the same, can increase their chances of marrying into wealth greater than their own.
Sometimes, however, this system backfires. A friend told me about her cousin Bing—a young woman from a well-to-do family in Beijing, who was planning to marry a man with whom she was very much in love. He was well off and owned property in Beijing, though his apartment paled in size to the one owned by her family. Knowing this might displease him, Bing didn’t tell him about her large apartment until just a few days before the wedding. The news of it made him very upset. He wasn’t so bothered that she held more impressive assets than he did, but he knew his family would be offended. His parents initially threatened to rescind their blessing on the wedding, but a crafty last-minute solution was devised. After the marriage, the newlyweds moved into Bing’s apartment and put her husband’s up for rent. All rent collected from the apartment was then directly paid to Bing’s parents, in an attempt to reinforce that their son was not living off of his bride.
In yet another property-induced wedding permutation, things didn’t end so well. Yue, a research contact, told me about a couple in the second-tier city of Wuhan who had met, fallen in love, and decided to marry. They proceeded to have their wedding pictures taken and began to plan their wedding ceremony before arranging for their parents to meet.
“We don’t have ‘engagements’ in China,” Yue explained. “For us, parents from either side meeting to discuss the terms of the marriage symbolizes the official engagement.” She stressed the importance of the parents coming to an agreement for the marriage to happen.
In this case, because the boy was from a significantly more affluent class than the girl, negotiations got off to a rocky start. His family was offering to provide the new couple with a home, but insisted, as seems to be common practice in China, that their son’s name be the only one to appear on the deed. Were this just a formality meant to reiterate the son’s official position as “provider,” the parents of the girl likely would have acquiesced. This requirement by the boy’s family, however, had much larger implications.
A 2011 amendment states that in the event of a divorce, the marital home belongs exclusively to the person whose name is on the deed. This change was made because the Chinese government decided that too many parents who had sunk their life’s savings into a home for their male offspring were losing out when that son later divorced and his former wife received half of the value of the house. While it is reasonable that controls be imposed to prevent the quick acquisition of property through an opportunistic marriage, this amendment heavily disfavors a partner who may have helped with the finances on a marital abode, but whose name isn’t on the deed. As is still common in China, a home is most often registered in the man’s name, regardless of who is paying for it. That means men end up owning a home that they may have only partially paid for, leaving their ex-wives significantly shortchanged.
In this case, the home already belonged to the boy’s family, so the girl wouldn’t have had to contribute monetarily to it, but her parents still wanted her name to be on the deed, as a protective measure. They thought it fair that she be considered an equal beneficiary of the marriage, and if the couple were to divorce, they didn’t want her to be left high and dry.
The boy’s parents responded by saying that the girl’s family was “asking for too much,” and called off the wedding.
To understand the degree to which property ownership can influence Chinese marriages, it’s worth noting that on March 1, 2013, the Chinese State Council announced that local governments should strictly enforce a rule ordering homeowners to pay a new 20 percent tax on the profits from the sales of a secondary home. As housing administration bureaus were swamped by people hoping to put their secondary properties on the market before the new rules took effect, marriage registration centers in Shanghai and other big cities across China saw a spike in divorce filings. In Beijing alone, the divorce rate increased by more than 40 percent in the first three quarters of 2013, as compared to the same time period the year before. Several foreign and local media reports indicated that the sudden uptick in divorces was the result of couples with a secondary home rushing to separate—at least on paper—so that they could claim owning only one home and sell their secondary properties without paying the tax. Most couples interviewed expressed a desire to remarry after the sale of their second home, though others just used the excuse of the legislation as a convenient means of parting ways.
Just how much of an economic impact the lust for property has had on the Chinese economy is impossible to put a precise number on, though it can be safely assumed that it has added some pressure to what has since become a whopping real-estate bubble.
“Whenever you have a system with very rapid expansion in credit and very low interest rates, you get bubbles,” explains Mike Pettis, senior fellow at the Carnegie Endowment and professor of finance at Peking University. “And that’s exactly what happened in China.” Pettis is very careful to point out that the bubble results not so much from the behavior of profit-hungry speculators, but from the nature of the purchases themselves, which has been largely speculative. “People who buy an apartment now because they expect they will need it in five or six years, but won’t be able to afford it then, are behaving just like speculators—they are buying early, assuming that prices will go up in the future,” he says. “And by buying early, they’re pushing prices up; it’s self-reinforcing.”
But before being able to speculate what the implications of this bubble may be on the marriage market, it’s important to understand how things got this way.
In 1998, when its private real-estate market was born, China was still at the top of its economic game. Exports were booming, and the economy was growing enough to sustain and employ the millions of migrants who were making their way from rural areas to big cities. Things remained rosy until roughly 2009, when the growth from China’s economy stopped being “real” growth. It was right about this time that the Chinese government injected a massive amount of credit into the economy. Rounding out at near US $5 trillion, this credit was made available through state-backed banks in the form of loans, and siphoned off largely to individuals with government connections, who later used those loans to invest in various projects. Yet since the loans were so easily and cheaply obtained, not all of the projects were very judiciously thought out and have since resulted in feckless investments—infrastructure projects, especially—that have rather misleadingly not added to the growth of the Chinese economy.
Shopping malls are a case in point. They’re all over major Chinese cities, and while they may glitter and sparkle and serve as the retail embodiment of the marvels of Chinese buying power, many of them are ghoulishly empty. In some cases, retailers are even offered space, rent-free, in order to draw in customers. While on paper, the act of constructing a shopping mall will be interpreted as a contribution to economic growth, it can only be considered “real” growth if the total economic value generated by the mall’s construction exceeds its total building cost. When this doesn’t happen, these so-called economy driving “investments” end up as a bank loan that will likely never be repaid.
Who is picking up the tab for these investment flubs? The same people who are paying top dollar for housing: Chinese consumers. Pettis explains that the losses from bad investments are just beginning to be seen, because they were originally hidden in loans. “For a very long time, many companies that should have gone bankrupt, never did,” he says. “They had government connections, so they could keep rolling over the loans. Losses grew, but they were hidden in the loans.”
Though Chinese banks, as the lenders to the faulty investors, should be the ones shou
ldering the losses for any loans that their borrowers can’t pay back, they compensate for these losses by passing along the debt to Chinese households. The banks pay extremely low interest on the savings accounts of Chinese households and the banks can later reissue these household savings as loans to investors at a very favorable rate—one that absorbs what they can’t pay back. Furthermore, by requiring Chinese households to pay very high interest rates on personal loans, banks can use the money from the interest to cover other business losses.
The bottom line: until three years ago when deposit rates were finally liberalized, the savings that Chinese households had in the bank were worth less every year. The less money the households have, the less they’re able to consume. The less they’re able to consume, the less the economy can depend on consumption for economic growth, and the more it must continue to depend on investments based on government-issued credit, which have a habit of not always creating positive growth.
While there are of signs of change on the horizon and Chinese premier Li Keqiang appears committed to reducing the state’s role in funding irresponsible investments, at least for the time being, developers are continuing to build, and real-estate prices are continuing to rise—making it hard on single men. They are still expected to own a home and/or a car before marriage, but are generally not able to afford either. They end up relying on their parents for help, and whenever economically able, their parents seem to aid them.
In exchange, however, parents retain a great deal of decision-making power over their son’s bride and are not much concerned about the issue of romance. They put a higher emphasis on the honor and assets that the marriage will bring to the family, especially since China’s lack of a social safety net makes Chinese children—many of them only children—the nest eggs of their parents. That works out to two young people supporting four elderly people, which given low salaries and high inflation, is no small order. Yet since parents must save, compete, and make huge economic sacrifices to secure the futures of their children, it is expected that the children will also marry in a way that is conducive to ensuring the social, financial, and emotional well-being of their parents in their golden years.