China Airborne

by James Fallows

  Under the Soviet-style Chinese system, the MEL existed but—like other standardized procedures—was applied in a subjective way. If a gauge was broken or a part missing, an airline executive could say, Looks all right to me. Let’s fly! Strict inspection schedules could also be made more lenient. In the world of international aviation, airplanes were inspected according to rigid schedules. After a certain number of days, or flight hours, or takeoffs, an aircraft could not legally make another trip until it had had crucial parts checked. This scrutiny pays off—think how often buses, cars, trains, and subways fail, and how rarely commercial airliners do. But as of the early 1990s China’s inspection schedule was still slapdash and largely subject to “the rule of man.”

  Perhaps the most important safety-related problem, as the efforts began, was the “check airman” system. In the United States and elsewhere, airlines have evolved the “check airman” system of continuing competency exams for which it is hard to imagine a full counterpart in medicine, the law, academics, or publishing. No matter how experienced and veteran the captain, he must periodically satisfy a specially trained pilot known as the check airman that he is still proficient. And the check airman, in his or her turn, must prove his continued competence through the check airmen’s records, as examiners are also subject to scrutiny by the FAA, to see how the percentage of passes and failures they are awarding compares with national norms.

  Much as with MELs and scheduled inspections, the need for check airmen and check rides was observed more in form than in reality in China. (For airliners the check rides are conducted in simulators rather than real airplanes, in order to present pilots with a wider range of emergencies and stressful situations than would be practical or safe to undergo in real airplanes.) Check rides are meaningful only if pilots are held to consistent, objective standards—and, in practice, if some of them fail. But in China the standards varied widely, and often all pilots passed. In 1997, a Chinese airliner plane crashed in Shenzhen, just north of Hong Kong, killing thirty-five people and injuring dozens more.9 The crash investigation indicated basic errors by both the pilots aboard, who made two landing attempts in the middle of a thunderstorm rather than diverting to a safer landing site. Things like this happen elsewhere—for example, the Colgan Air crash in Buffalo, in 2009, led to a reevaluation of how regional airlines trained and supervised their pilots. But within the Chinese system it highlighted existing concerns that the system was not doing enough to ensure that planes—or pilots—were safe to fly.

  “The check airman system was a problem,” Joe T told me, not long after the Colgan incident. “The check airmen lived with all the other pilots, their wives were friends, their kids went to the same schools, they had the same housing.” If a check airman judged one of his neighbors on a test flight, and failed him, he knew that the unfortunate pilot would lose face, would be subject to remedial training, and might possibly lose his job—all very disruptive consequences within a tight-knit community.

  Through the late 1990s, the shared imperative of reducing crashes created an improbable alliance of Chinese, American, and international businesses and organizations. In 1997, two Chinese airlines—Air China and China Eastern—had already been approved for prestigious and strategically important routes to the United States. China Southern had applied for approval to be the third, and had taken delivery of new Boeing 777s in anticipation of launching service from Guangzhou to Los Angeles. Because Guangzhou was a center of the outsourcing business, direct service there was expected to be attractive to business travelers and be lucrative for the airline.

  But routes to the United States required approval from the U.S. Department of Transportation, parent body of the FAA. At the urging of the FAA, the department decided to use the application as leverage to force—or encourage—a broader improvement in Chinese safety standards. The FAA had no direct regulatory power over China Southern or any other foreign airline. But it could ask for confirmation that China’s regulatory standards, as applied by the CAAC, conformed to the worldwide guidelines laid out by international agreements. The message came back from the U.S. government to China: Before any more airlines get routes to the United States, we’d like to know more about how Chinese regulators do their business.

  The Chinese airlines were naturally flummoxed. Boeing, an American company, had sold them the planes in expectation that they would be used on flights to the United States. Why would the American government get in the way of this transaction? Was this some kind of double-cross? The Chinese government would not interfere with commerce in this way! China Southern had more planes on order from Boeing, but its officials were in no mood to receive—or pay for—those planes unless this mess with the regulators got straightened out.

  Boeing was not the cause of the safety problems with Chinese airlines, but Boeing decided that resolving them was partly its responsibility. In collaboration with the FAA, it began preparing a series of seminars, tours, training sessions, and briefings to connect Chinese regulators and inspectors with their counterparts in the United States. Boeing could not legally hire current FAA employees to come to China to provide safety briefings. But it could hire recent retirees—and it contracted with several of them to come to China to size up the situation and then brief and train CAAC officials in several major cities. Joe T—who knew the FAA, Boeing, and China—was involved in coordinating this project.

  Because of careful warnings by Joe T and others, the U.S. training team was hyper-sensitive about two aspects of this training exercise for their Chinese colleagues. One was to present all their recommendations in terms of meeting international standards for air safety and airline procedures, rather than seeming to say, This is how we do it in the U.S. of A. Presenting the challenge this way made it far more palatable to the Chinese side. Learning to comply with international standards was one more sign of modernization in China; doing things the “American way” could seem like a sign of continued subservience. The examples were, of course, from American practices at the FAA or the operational details of Boeing and United Airlines, but the leitmotif was that Americans had learned how to make their practices meet international standards, and they could help the Chinese do the same thing.

  The other sign of cultural sophistication by the U.S. team was its awareness of “Chinese characteristics.” Even as the Chinese government and business officials felt they were moving toward international practices, they highly valued the idea that they were doing so in a distinctively Chinese way. Deng Xiaoping’s famous description of the country’s post-1979 market system as “socialism with Chinese characteristics” set the pattern. The term illustrated not only the flexibility of names for the fast-moving contradictions of modern China—a “socialist” system with room for Lamborghini dealerships and the world’s starkest extremes between rich and poor—but also the importance of “Chinese characteristics,” known as Zhongguo tese, or . Because of China’s scale, its unusual speed and pattern of development, its low labor costs and other unusual cultural or historic features, systems developed in Tokyo or Los Angeles usually need adjustment to work properly when they are applied in Tianjin or Shenzhen. Even when they don’t need any changes, leaders of Chinese organizations value the idea that systems have been changed to reflect Chinese characteristics. This is their version of what Americans have come to call “American exceptionalism.” In the case of the air-safety briefing teams, this meant, for instance, that FAA and Boeing officials would explain how they wrote safety manuals and regulatory codes, leaving it to the Chinese to apply those principles in their own circumstances.

  “Early on, some Chinese people pulled me aside and said, ‘We’re not really sure this will ever work in China,’ ” Joe T said to me, ten years after he began the project. “They were worried about losing face, disrupting the culture of ‘human relationships.’ ” One of his crucial allies was a pilot named Rao Xiaowu, who had flown MD-11s for China Eastern Airlines and gone on to become a senior flight-standards official at the CAAC
. (The MD-11 was an even larger version of the familiar DC-10, an airplane with one engine under each wing and a third in the vertical stabilizer, just above the tail.) Rao had experience overseas and understood how profoundly Chinese airlines had to change if they hoped to reach international standards. The second champion was another pilot, Yang Yuanyuan,10 who had joined the PLA at age sixteen during the Cultural Revolution, graduated from flight school at age nineteen, and joined China Southern Airlines, for which he eventually became chief pilot. In the late 1990s, as the cooperative Chinese-U.S. safety efforts were beginning, Yang had gone to CAAC as head of flight standards.

  “Yang and Rao made clear that they really did expect this to work,” Joe T said. “They went to meetings and told people at all the airlines, ‘We want you to pay attention, because we want a system that is run to international standards.’ They told their colleagues, ‘If we stick to regulation by “human relations,” we’re going to keep having dead people. It has to be run the international way.’ ” Yang had the authority at CAAC to place key allies in the airlines’ safety department, which he used. “The Chinese have a term, ‘air-drop soldier,’ for someone who is dropped in because of high-level connections but doesn’t know what to do,” Joe T said. “Yang did just the opposite, making sure he had the right people in these roles.”

  Neither the Chinese nor the U.S. government had a big budget for the training efforts, so Boeing continued underwriting much of the cost. United Airlines helped as well. In Seattle, visiting teams of Chinese regulators and check pilots watched Boeing train pilots in its simulators. In a special demonstration at United’s simulator center in Denver, they watched a pilot mimic the mistakes and rash judgments of an incompetent airman—mainly to observe how the United check pilot handled the situation and corrected his errors.

  “Those exchanges started in 1997, and they have never stopped,” Joe T told me in Beijing in 2011. It was the beginning of the underpublicized but thoroughgoing near-integration of the U.S. and Chinese aviation establishments in safety measures. In 1999, Yang Yuanyuan became vice minister of the CAAC. Three years later, he became minister, and thus the single most influential person in China’s aerospace establishment. Did their efforts make any difference? Through the next decade, Chinese commercial aviation, while expanding faster than any other country’s, was statistically among the world’s very safest. And it prepared for the surprising next transition the government authorities had in mind.

  4 * The Chinese Master Plan

  How aerospace fits into the larger vision

  When Deng Xiaoping met Jimmy Carter in 1979 to formalize the new era in U.S.-China relations, which in turn helped provide markets for the new enterprises that were possible under Deng’s reforms, the per capita annual income throughout China was about a thousand dollars. Over the next thirty years, that went up almost fivefold, a sustained increase unprecedented in world economic history. Most of what has made the country steadily richer through that period has arisen from the following sequence: farm to factory to bulldozer.

  First came improvements in agriculture, through a shift from inefficient collective farms to smaller private plots, plus very heavy use of insecticide and fertilizer (with subsidized water as well). The subsidies meant that Chinese farmers often used even more fertilizer, pesticide, and water per bushel of output than their European or American counterparts. But the boost in productivity allowed a densely populated nation to feed itself, so that the famines that had been its recurring historical calamity—including the disastrous politically induced famine during the Great Leap Forward—were no more. The same improvement also marked the beginning of many modern farm-based fortunes—some of today’s famous rich families in China made their money in the cattle and dairy business in Inner Mongolia or with pig farms in central China—and reduced the manpower needed to tend the fields, freeing family members to go to the cities for factory jobs.

  Then came the low-cost manufacturing boom whose effects began to be noticed throughout the world in the early 1990s. This was different from Japan’s modern manufacturing boom, which had started in the 1960s, in that China’s was largely driven by foreign firms. Dell, Walmart, Apple, Siemens, GM, GE—they and hundreds of others shifted and outsourced operations to China, whereas the most important steps in Japan’s development were taken mainly by their own big companies. Because it started its industrialization almost a century before China did, even by the 1960s Japan had big, mature corporate groups—like Mitsubishi, Toyota, Matsushita, Fuji, NEC, Toshiba, plus postwar upstarts like Sony and Honda—that could compete internationally with American and European firms. China still has no counterparts and indeed virtually no globally known brand names.

  China’s low-wage industrial boom differed from India’s development through the same period in that it depended much less on an educated workforce, like the software engineers working in Bangalore and Hyderabad, and more on hardworking young men and women straight from the countryside. China’s boom also depended on the roads, shipping docks, and other elements of infrastructure that could get the products to their customers in big Chinese cities and overseas.

  Creating this infrastructure was itself the third element in the sequence of Chinese development, and a subset of the fourth element, construction in general.

  Visitors from anywhere, and with special piquancy those from the United States, have to notice how new—how smooth, how capacious, how modern—the recently finished parts of China’s infrastructure are. Roads, subways, train lines, power stations—they are, in fact, new compared with most of the U.S. and European infrastructure.

  It is true that buildings and facilities tend to age quickly in China, because of pollution and, sometimes, shortcuts in construction standards. Early in my time in China, I’d see buildings that I thought were from the 1960s or earlier, and then be surprised to learn that they were only four or five years old. After a while, I learned to apply an “accelerated aging” factor to any structure I saw. For instance, the mammoth and uniquely styled CCTV tower near our apartment in Beijing, which was designed by Rem Koolhaas and which has two slanting black legs connected by an angled upper story, was rushed to completion in time for the Olympic Games in 2008. Three years later, its harshly weathered look made it appear as if it had been there for decades—even before the CCTV news operations had moved in. It is true as well that successive public disasters in China have repeatedly led to outrage over “surprising” defects in construction materials, safety standards, honest inspections, and so on. This was especially so after the Sichuan earthquake in 2008, when thousands of children died in the collapse of shoddy school buildings, and after a high-speed rail crash in 2011.

  Still, on average, China’s infrastructure looks much newer, and is often better, than its counterparts in North America and Europe built fifty or one hundred years ago. The heavy infrastructure of U.S. cities on the East Coast was laid down in the decades after the Civil War; that of the Midwest at the beginning of the twentieth century; and that of the West Coast and the Sunbelt in the decades after World War II. The freeways of Southern California looked wide and new when I was growing up there in the Boomer era. That is how the freeways of China look now.

  Simply keeping its existing bridges, freeways, and waterworks from falling apart is the infrastructure challenge for the United States. For China, the heavy investment in roads, ports, power stations, train lines, and so on has been, like many of its other growth strategies, so successful that it has bred a different kind of problem. The consequences of more than a decade’s worth of overinvestment are as important in shaping China’s choices, and its outlook on new industries like aerospace, as the consequences of long-term underinvestment are for the United States.

  Addicted to growth

  Part of the success of China’s infrastructure strategy is that it has made every other kind of growth more attainable. When factory wages go up in the Shenzhen area north of Hong Kong, outsourcing businesses might think about relocati
ng to Vietnam or India. But they are more likely to end up heading to Sichuan or Gansu province in inland China, because the Chinese roads and facilities are likely to be so much better than those of any country that has not been building at such a frantic pace through recent years.

  Also, infrastructure efforts and the larger construction industry remain powerful growth engines on their own. Charts of the components of China’s growth since the early 2000s consistently show one element that is higher than its counterparts in any other major economy: “capital formation”—essentially, investment of all sorts. New factories, new houses, new roads, new bridges, new sewer systems, new subways. New everything, with the caveat that these are not goods for immediate consumer use. The advantage for China is that this investment builds future productive capacity, a better life, a richer society, and so on—and in the meantime, it creates jobs for people who are doing the building, and markets for companies that sell structural steel, cement, and every other ingredient.