The view of The Economist

economy - The Quest for China's middle class

I love it when companies, academics or journalists jump on the famous 'middle class' bandwagon. Chinese academics had a go at it, while blogger and add sales person Imagethief has his own thoughts.
Let's put this all a bit in perspective.
Long, long time ago, there were only two classes: the poor and the rich. Then, at the end of the 19th and beginning of the 20th century the poor developed this nasty habit of beating the shit out of the rich every now and then. Some people called this a 'class struggle', but that word has been now become defunct because the rich came up with this beautiful idea of redefining the poor into the middle class. It was very un-middle class to beat the shit out of the rich, since the middle class people were a little bit rich themselves.
How powerful the ideology of the middle class has become is illustrated by the fact (mentioned also by Image Thief) that 95 percent of the Americans think they belong to the middle class. Even those who would belong according to almost every objective definition to the rich or to the poor do not want to be there: they still feel they are middle class.

Chinese researchers have their own set of criteria to define their middle class:

The study group's definition of "middle class" was a person with a monthly income of 5000 Yuan, or about 617 US dollars; with a bachelor degree or above; and who works as a civil servant, company manager, technician or private business owner.

According to that definition almost 12 percent of the Chinese is now officially middle class, so they might have to finetune their definition to include more Chinese. Other problem: Being middle class is not yet seen by the 'average' Chinese as an ideological status they want to obtain. Most Chinese simply want to become rich, even when it might take a while before all 1.3 billion inhabitants of this country are there. Why go for less?
When foreign companies entered the Chinese market, they first thought that all Chinese would be eager to buy their toothpaste, TV-sets and cars. Even in the case of rather affordable toothpaste that has proven to be an illusion, so by now most have refocused their efforts on this category they remembered from back home: the middle-class. Unfortunately, it is more an ideological than an economic category, so very hard to mix it with your sales targets.
While China did have a bit of class struggle in the past, it never had enough rich to beat up: most people were just poor, even those who were beaten up. Now the number of rich is going up, but class struggle has become outdated and the country is lacking the ideological reasons for creating the middle-class that has been so powerful in the US and parts of Europe. As an economic category it has been a great deal of bullshit to begin with.
Again: my Chinese friends do not want to be middle class, they want to be rich. They do not want a 'Volkswagen' everybody has, but a Buick that shows they really have money. (Even if they just took a nonrefundable loan from a bank or anybody else stupid enough to give away their money). They want big-size LCD screens and their apartments should look like palaces.
So, talking about the middle class says more about the researchers, journalists and marketing managers who use the concept and less about the Chinese society.