The Middle Kingdom, Part II: Optimistic Authoritarianism
China a beautiful and surprisingly optimistic police state.
I recently shared my initial impressions about economic growth and surveillance in China. Instead of being cowed by surveillance, I found people energized by a decade of material upgrades that make the American Acela corridor look like a relic of the steam age. Here are some additional observations based on three weeks of travel in Guangzhou and Yunnan.
I have divided these observations into five parts: world-class China, conservative China, weird China, things you rarely see, and things that are just plain broken.1 Also, because it’s a stunning country that I want you to visit, I append some travel tips learned the hard way.
World Class China
China now leads the world in several key areas. This is hard to believe until you see it.
Transportation. Chinese trains, train stations, airlines, airports, cars, freeways, bridges, and tunnels have all surpassed the US. Chinese people seem aware of this and it is a source of popular support for local, provincial, and national governments. China builds infrastructure at world-leading quality and scale.
Home ownership. 90% of Chinese families own their own home. This is a massive accomplishment, even if the state overbuilt, especially in central and northern China. As a result, homes are a depreciating asset, which is always politically explosive. And the banking system has indigestion as a result. But this is an incomparably better problem than the under-built cities of the U.S. and the shameful blight of homelessness that has resulted.
Green Energy. China reached a fascinating milestone in 2026. It now operates the world’s largest renewable energy system, yet it remains the global heavyweight in coal consumption. This “dual-track” strategy allows China to lead the green transition while maintaining strict energy security for its massive industrial base. China’s combined installed capacity of wind and solar (approx. 1,840 GW) has now surpassed its coal capacity. In 2025, it generated roughly 4 trillion kWh of renewable energy. This exceeds the total electricity consumption of the European Union. Clean energy is now over 11% of China’s total GDP. But coal still accounts for about 60% of total electricity production.
Yunnan province is the crown jewel of China’s renewable efforts, specifically through its massive hydropower resources. It serves as a primary source for the “West-to-East Power Transmission” project, sending clean energy to industrial hubs like Guangdong.
Yunnan is currently pioneering a multi-energy complementary system. Because hydropower can be adjusted quickly, it is used to “smooth out” the volatility of the newer, massive wind farms being built in Huize County and solar parks in the Yunnan mountains. When the wind drops, the dams release more water; when the wind is strong, the dams hold water back, effectively acting as a giant physical battery.
Research. During the early 2000s, I visited perhaps a dozen Chinese research publications. At the time, research focused on sheer volume and the quality was forgettable. The situation is entirely different now. A year-long study by the Australian Strategic Policy Institute (ASPI) showed that China has a “stunning lead” in 37 out of 44 critical and emerging technologies. In some fields like Material Science, all of the world’s top 10 research institutions are based in China. China faces real headwinds in aviation engineering, biotechnology, and the culture of foundational innovation, but I see no reason that they will not close most of the remaining gaps. Especially when the U.S., their main rival, is so determined to reduce investment in scientific research and development that 75% of American research scientists are considering leaving the country.
Food. The diversity of protein and produce in Yunnan is phenomenal. Cantonese is the baseline, but the regional flavors are legendary and, crucially, cheap. Chinese access to fresh, healthy, and often delicious food is phenomenal. Protein, fruits, and vegetables are diverse and the flavors are legendary.
Architecture. Not long ago, China produced mostly bland, uninteresting buildings. They still do a lot of that, of course, but in Yunnan, the 'bland' era is over. New builds now blend ethnic Bai or Naxi traditions with hyper-modern glass and steel—a sophisticated regionalism likely born from two decades of Western firms like Gensler training local talent.they also produce outstanding modern and classical buildings that honor the ethnic traditions of the regions, at least in Yunnan. The interiors of many Chinese buildings are also now very attractive and well-designed. This was not always true.
Public Safety. There is little public disorder or crime in China. Public order isn't just a byproduct of the police state; it’s a cultural refusal to tolerate the 'urban decay' aesthetic—piss-scented subways and open-air drug use—that many American cities have seemingly accepted as the price of liberty. Most actual cops here are helpful, not the jackbooted authoritarian thugs I witnessed in sixties East Germany, the seventies Spain under Franco, or the terrified population I met at the end of Mao’s Cultural Revolution.
Nobody here takes the law lightly. The state, its cameras and state security are never far from sight. Stops to inspect seat belt use, car registration, and breathalyzer testing are common. Everyone knows that they are monitored in public – and for the most part, they are OK with that.
Conservative China
Those with privileges in China are very good at preserving them. Of course China is not and never has been a classless country. But Chinese income inequality measured by Gini coefficients is now is about the same as in the U.S. As a result, some things in China work very well for privileged groups and poorly for others. If you are Han Chinese registered in a Shanghai household with high national test scores, your life will be very good indeed. If you are a peasant kid in the boondocks who has just been handed the business end of a hoe at age eight, not so much. Here is how privileged Chinese preserve their status.
Limits to economic mobility. China’s richest provinces are more than four times richer than its poorest ones. For comparison, New York, the richest US state, has about double the per capita income of Mississippi, our poorest one. Importantly, people can move from poor states to rich ones in the US, but the hukou system prevents poor people from relocating within China. More on this below.
Limits to educational opportunity. To start with, lots of Chinese have no education at all. To quote the indispensable China Talk substack:
“According to China’s 2020 census, only 30.6% of the population has ever attended high school (including non-academic vocational secondary school), which Stanford professor Scott Rozelle notes, “is lower than South Africa, lower than Turkey and lower than Mexico.” In 2022, roughly 40% of China’s middle school graduates didn’t go on to attend high school of any kind, and among the students that do continue their education, national policy stipulates that roughly half (“五五分流”) are funneled into non-academic vocational high schools with no path to enter college.”
Chinese 18 year-olds who are still in high school take the grueling gaokao exam each June. Your score determines your college and your future, so the pressure from families on Chinese teens is famously intense. You hear of 18-hour study days, seven days a week. Top students go to China’s top universities and can get top jobs. Mediocre students become schoolteachers. One person who recognized the paradox of weak students becoming teachers and cynically describe it the career path as “devil to devil”. Rural students attend inferior schools, which creates strong incentives for parents to send their kids to boarding schools, where research suggests they often become isolated and depressed.
Stratified health care. Universal access to decent healthcare is a cornerstone of Chinese communism. During the 1970s, barefoot doctors were romanticized in books like Norman Bethune’s “Away With All Pests”. Today, the healthcare landscape in China is divided between a truly massive public infrastructure and a rapidly growing, high-end private sector. Public hospitals handle about 90% of patient volume in China and are organized into three tiers. Tier 3 hospitals are large, well-equipped urban hospitals with the most experienced doctors. These can be quite crowded. Tier 1&2 hospitals are smaller community health centers or district hospitals for basic care and referrals.
Many top public hospitals now have “International” or “VIP” departments. These offer shorter lines, English-speaking staff, and private rooms for a higher price—often a middle ground between public care and private clinics. Major cities like Shanghai, Beijing, Guangzhou, and Shenzhen have seen an explosion in private healthcare by providers that cater almost exclusively to expats and wealthy locals. These facilities mirror Western hospitals with English-speaking doctors, direct-billing for international insurance, and luxury amenities.
China has now heavily integrated AI into its healthcare delivery to address rural-urban gaps. You can consult with doctors via apps like WeChat or Alipay, receive a digital prescription, and have medication delivered to your door within hours. Many Tier 3 hospitals now use AI for preliminary screening of CT or MRI scans and skin conditions to speed up the triage process.
“Hanification”. The Han majority in China officially recognizes 55 ethnic minority groups that make up about 9% of the population. Chinese policy towards its ethnic and religious minorities comes in two flavors: those for interior minorities and those for minorities on China’s borders.
Interior minorities. Yunnan is central casting for interior minorities. Bai, Yi, Naxi, Hui (Muslims), and Yunnanese Tibetans are seen as adding “local flavor”. Many are very successful in business. They receive added points on their gaokao tests, to more easily enter major universities. All speak Chinese and many intermarry. These groups are Exhibit A in China’s effort to assimilate (an in many cases “Hanify”) its ethnic minorities.
Frontier minorities are Tibetans and Uyghurs (and to a lesser extent, Mongolians). These groups control large territories on China’s frontier, and have often spawned separatist movements. They have organized religions that the CCP often sees as a rival to its authority. They have resisted adopting Mandarin. For these reasons, the CCP often views Tibetans or Uighurs as a threat to national unity. In Xinjiang and Tibet, the Chinese state sees ethnic identity through the lens of counter-terrorism or anti-separatism, not a happy melting pot as in Yunnan. The result is “hard” assimilationist policies: mass surveillance and detention, “re-education” centers, and boarding schools designed to prioritize Mandarin over mother tongues.
Head Scratchers: Strange Things About China
Some things always strike a foreign visitor as odd. That’s part of why we travel overseas.
Scooter Swarms. In the 1970s, cars were reserved for senior communist officials. Everyone else rode black 50 pound bikes called Flying Pigeons. As China advanced, cars became common, then ubiquitous, then electric. Shared bikes were invented here, and after some false starts became widely available and cheap. On college campuses, they still are.
But electric motor scooters (called “e-bikes” here, but they have no pedals) are rapidly displacing bicycles. They are very cheap (the low end models cost about the same as a cell phone) and you can rent them quickly everywhere. As with the now hard-to-find bikes, you just scan a barcode and take off. You pay ten yuan an hour ($1.30 at current exchange rates and roughly double that if you convert based on purchasing power) through WeChat or AliPay.
Every road has hundreds of these scooters, which are both incredibly useful and super annoying. They increase the carrying capacity of roads and solve the last-mile transportation problem, but they are a silent menace to anyone on foot or on a bike. These scooters are the backbone of China’s massive gig-based instant delivery services, a topic I plan to write about in more detail soon.
Clueless Use of American brands. I would not think of wearing a T-shirt with Chinese writing on it that might say “kick me, I’m stupid”. Here, lots of people wear brands out of context. Yankees hats are common, as are T-shirts that say simply “Colorado”. I sat next to a guy on a bus with a MAGA hat who had no idea what it represented. An old guy wore at hat saying PwrGrls – a well-known women’s gym in Los Angeles. Another had a corporate shirt from Sig Sauer, a famous maker of handguns.
“Trumpchi” cars. The Guangzhou Automobile Group makes a car that sounds like a portmanteau of two world leaders: Trump and Xi. It’s a coincidence, but a funny one. GAC launched the name, which translates into something like “spreading good fortune” long before Trump got into politics. It uses the GAC brand overseas because they found that “Trumpchi” does not sit well with many customers.
Commodified Ethnicity. The state encourages ethnic identity as an aesthetic while strictly controlling it as a political force. Nowhere is this clearer than the peculiar fad of ethno-phototourism.
Throughout Yunnan, hundreds of young people rent the costumes of local tribal minorities and pay for a 2+ hour makeup session to prepare them for greatness on Chinese Instagram.2 They hire a professional photographer, often skanky guys with iPads around their necks who promise to improve the results digitally in case make-up doesn’t do the trick. They charge for two hours of fashion photos at iconic locations.
Imagine thousands of young people in rented Navajo dress, complete with professionally applied warpaint, posing in front of the Grand Canyon for gig photographers carrying the latest Canon cameras and digital enhancement tools.
This is not a minor fad. There are hundreds of these folks at every park, temple, or picturesque site in Yunnan – and Yunnan is stunningly picturesque. Ethno-tourism is a multi-billion dollar industry that gives cultural appropriation a bad name. Worse, nobody seems to enjoy it very much.
What’s Broken
Some things in China just suck — to me anyway. Some may improve; others I am less confident.
The Household Registration System. The hukou is China’s household registration mechanism that functions like an internal passport to restrict geographic mobility. It has been the bedrock of CCP social control and privilege preservation for decades. Although it should have been abolished with prejudice long ago, it is currently undergoing the most significant overhaul in its history. Here is how it works.
At birth, every Chinese citizen is assigned a hukou based on your parents’ registration that categorizes you as either rural or urban and identifies your city or village. Your hukou is the key to your social benefits and opportunities for economic mobility. If you live and work in a city where you don’t hold a hukou (e.g., a migrant worker in Shenzhen with a rural hukou from Sichuan), you often cannot access local public schools for your children, subsidized healthcare, or affordable housing.
The system is a NIMBY dream. It locks in the privileges of residents of super-cities like Beijing and Shanghai by guaranteeing them access to the country’s best hospitals and most elite schools. Their children face lower entry requirements for top universities. It protects their housing values and social prestige by strictly limiting the influx of poor people.
The state loves it. The hukou gives them a mechanism to control migration flows and prevent the formation of urban slums that often plague other rapidly developing nations as poor people seek out opportunities that only cities can offer.
Slowly, the hukou, is changing. With collapsing birth rates, China abandoned its ill-considered one-child policy. With overbuilt cities desperate to fill “ghost housing”, the CCP is finally loosening the hukou. As of this year, restrictions on obtaining an urban hukou have been almost entirely abolished in cities with fewer than 3 million people. In many cases, you simply need to live and work in a place for six months to qualify. Also, social insurance is increasingly decoupled from household registration. Workers can enroll in pension and health insurance plans in the city where they work, regardless of where their hukou is registered. Importantly, this only applies to small cities – Beijing and Shanghai still use a strict “Points System” based on education, tax contributions, and professional skills to limit entry.
Smoking. Almost half of all Chinese men smoke, but fewer than 2% of women do. Even though state-owned tobacco companies see this as a “market opportunity”, female smoking is not a sign of independence in China like it was in the U.S. during the 1950s. Cigarettes remain high-status business gifts. And the state is hooked on tobacco: 30% of Yunnan’s public revenue comes from tobacco. This makes the province’s aspiration to transition from “brown” industries (tobacco and mining) to green ones (exporting hydro energy and tourism) a lot tougher. The state has a financial interest in addicting people although in fairness, the use of nonsmoking areas in restaurants, hotels, and airlines has grown a lot.
Political debate and independent journalism. There isn’t any. China’s future is decided by a small cadre of self-selected bureaucrats — and China is vastly poorer as a result.
Privacy and digital security. I described this earlier. Cameras are everywhere. Americans traveling in China are subject to government surveillance, malware installation on devices left in hotel rooms, phishing attacks, and the monitoring of online activity, especially via public Wi-Fi or local apps. Your phone is monitored and your passport checked frequently and reported to the State Security Bureau. You must use WeChat or AliPay to communicate or pay for anything – and it’s monitored. Some of the travel tips below will limit your personal risk, but you cannot avoid it completely.
Things You Rarely See in China
These are hard things to capture because it’s tough to spot what’s not here.
Overhead electrical wiring. Once you notice this, it blows your mind — China has undergrounded almost all residential and commercial electric lines. In a few places, this process is not fully completed, but removing “spider webs” was a central part of China’s transformation of its electrical grid during its rapid urbanization between 1990 and 2015. This happened differently in different regions: big cities invested in IUTs, large integrated utility tunnels that carried water, electric power, gas, and sewage. Newly built areas or cities undergrounded utilities from day one. Smaller towns have gone house to house. The effect is impressive, especially in contrast with the 20+ year wait to get electrical wires on a single residential block placed underground in the Bay Area.
Americans. We have visited plenty of tourist spots, but have only encountered two Americans — and then only for about ten seconds. We have met Russians, several Europeans, lots of Hong Kong-based Brits — but few Americans. This is nuts — Yunnan is rightfully a major tourist destination for Chinese travelers, who visit in the tens of millions. It’s amazing and if you travel, you should come see it, even if Chinese visas and digital security make it harder than it should be.
Litter or trash. If you work at it, you can find litter here – on obscure cul-de-sacs in the far end of nowhere — but it is really unusual. Recycling bins are everywhere. There are still people who hand-sweep the streets at 5:00 AM, but there are normal, automated street sweepers as well. [Oddly, each town has a song that its garbage trucks play as the make their rounds. In ShangriLa, a Tibetan tourist mecca, it’s “Happy Birthday”.] China is very clean.
Rebellion. In every country, the young and congenitally dissident play a valuable role by challenging conservative mainstream norms. They may promote punk rock, heavy metal, or other angry music. They may dye their hair blue, get tatoos designed to offend, or wear preposterous clothing. Or they may write novels or create art that challenges mainstream sensibilities. Where homosexuality is supressed, it often fuels the fires of rebellion (that it seldom does so any more in the U.S. is surely a sign of progress). I walked past a dozen bars with live pop or rock groups in Linjiang tonight and they all seemed listless. No blue hair in sight. I am sure that young people find ways to rebel in China – but most of it is hidden from my western eyes.
Bitcoin. It’s illegal here (although it’s all over Hong Kong). This is fine by me. Except that when my wife earned some RMB that we needed to transfer to a US bank account, Bitcoin would have let me evade China’s onerous capital controls. Which is precisely why they ban it and we should as well — most of the use cases for crypto are to help people break the law.
Summary
Despite its problems, China is a justifiably and enviably optimistic place. People have seen massive, sustained improvements in their daily lives. Most are vastly better off than they had ever hoped to be.
One way to see this is to listen to how most Chinese view AI, which serves today as our global Rorschach test. Even in a terrible job market for college grads, the students and professionals we spoke were surprisingly optimistic. They imagine that AI will be the best thing ever, not the worst. Americans are much more pessimistic; we worry about unintended consequences.
Try to visit China. It is a beautiful, wildly diverse country that is changing rapidly. Like the New York Times, I specifically recommend Yunnan, which has also become very popular with Chinese tourists. I was inspired to visit after listening to Dan Wang’s Conversation with Tyler. (I strongly recommend Dan’s essays, his excellent and widely acclaimed book, and his talk with the irrepressible Tyler Cowan.)
Pro Tips for China Travel.
You can find most of what you need online. Here are some tips that are harder to find and a few specific things I learned.
1. Educate yourself on the digital risks. In addition to the risks described ad nauseam above, you will be subjected to spam and scams originating from Cambodia and Laos. China is very safe from street crime, but digitally, it’s a tough neighborhood.
2. Decide on your phone strategy. This is the worst part of traveling in China. I assume that everything gets infected and monitored, so I bring a burner phone and tablet and use a burner email account. When I get home, I move the photos and new contacts, kill the email accounts, and scrub every device. This is a massive PITA, so if your risk tolerance is higher than mine, your life will be a lot easier.
Pick a burner phone. The best choice: an old iPhone 13 from eBay. It is the last iPhone with a physical SIM, which you need in China because as of now, they do not support eSims. And the camera is good. I love Pixels and brought one to China, but iPhones get 5G and most Pixels top out at LTE because Google doesn’t engineer its phones to work in countries where it is blocked.
Pick a data plan. I used Holafly and would give it a B+. It has unlimited data and a built-in VPN. It worked most places, but required a reset every day or two. And they cap your hotspotting, which is annoying if you want to use your phone to connect a tablet or laptop.
Get a Chinese phone number. You may need one to set up WeChat and AliPay, which are used to pay for everything. You also need a phone number to get a code from your credit card company when the algorithms reject charges from China, even though you told them your travel plans. I got an account from China Mobile after I got here. You need to find a store that supports accounts for foreigners – not all do. Some e-sim companies sell Chinese phone numbers alongside their data plans, but I haven’t tried that.
Pick a VPN. I avoided WiFi and lived with the Holafly connection most of the time. The public hotel networks are faster, but big hotels can have added barriers for VPNs. You need to set up your VPN before you arrive in China, or it won’t penetrate the Great Firewall. Get two in case one fails. I used Surfshark and Let’sVPN, which cost more, but worked more consistently. There are folks online who evaluate these things; it changes constantly.
3. Set up a burner email. The problem with email is that once compromised, an intruder can reset passwords and gain access to your professional, financial, personal, and medical life. I used gmail, which worked over the Holafly VPN but is always targeted, so it can be fussy. I might try something else. Obvious but important: don’t forward your native email or you destroy the entire point of having a separate one.
4. Pay attention to your visa terms. Getting a visa is bureaucratic, but straightforward. If you want to visit Hong Kong or Macau from China, make sure to get a multi-entry visa. I spent ten days in Zhuhai, a town near Macau, and decided to check out the former Portuguese colony. As I was about to order a Didi to the border, I googled visa restrictions. Turns out that I had a single entry visa, which meant that I would have been allowed to enter Macau but denied reentry to China, which would have completely nuked two weeks of planned travel in Yunnan. Don’t let that happen.
5. Get the apps you need.
Maps. Google Maps is great for seeing where you are but terrible for navigating. It is blocked, so has no on the ground data about new roads, traffic, hotel names, reviews, etc. But it has a popup feature that will read your destination out loud in Chinese – essential when using taxis. Download the local maps to your device. For navigation, use Amap.
Chat and payments. Install the English versions of AliPay or WeChat, link your credit cards, and figure out how to make payments before you arrive. It’s not intuitive, but it’s easy the second time. If someone offers to pay you in RMB, either plan to spend it in China or fight hard to get paid in dollars, even at a crappy exchange rate. Getting RMB converted to dollars and wired out of Chinese banks is a dark art, and most banks won’t help you.
Reservations. Trip.com worked exceptionally well for plane, train, and hotel reservations. It covers larger home stays, but not always small ones. And it could not book train tickets during a busy holiday. For that you need someone who reads Chinese to help navigate 12306, the fetchingly named site run by China Railway.
Cars, taxis, bikes. You can access Didi (Uber), bike rentals (most work directly from AliPay or WeChat’s scanner), Metuan (food delivery), and a lot more via the apps that run inside the WeChat and AliPay universe. Setting these up can be fussy, but I got there. YouTube sometimes helps.
Translation. Google Translate is indispensable. Get good at using all of its features (camera , conversational, and typed translation). I used all of these features multiple times each day when I was not with folks who spoke Chinese. Download the dictionary for simplified Chinese, not Mandarin. I carried some alternative translators in case Google was blocked, but thanks to the download, I never had to use them.
6. Get a good guide. A local English-speaking guide who understands your preferences and serves as a local friend makes or breaks a trip. We found this indispensable in Yunnan. An excellent and experienced guide can help you book hotels that are unique, including homestays, which are more like B&Bs or local inns than a traditional AirBnB. Small homestays are a great way to meet families. A good guide knows good restaurants, hikes, local temples, concerts, discussants, museums, and home stays. They can book a tea tasting in Linjiang, an art class in Shangri-La, and a trip to a Naxi occupational school for silk embroidery artists that sounds lame but was amazing. We had an excellent guide in Yunnan and I am happy to share his name – but it is just one data point.
The standard caveat applies: nobody visits the same China twice because the country is vast and evolves very quickly. Also, I do not speak Mandarin — but I traveled with people who do, and am shameless and quick with Google Translate.
They are driven by Douyin (basically TikTok on steroids), QQ, Xiaohongshu (Little Red Book): an Instagram-style lifestyle inspiration site, and Bilibili (it’s for young people - I can’t figure it out). As in the U.S., these sites are incredibly influential and culturally stupefying.