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Introduction: February 13, 2003

Filmed over the course of three turbulent years, "China in the Red" is a two-hour documentary that tells the stories of 10 Chinese individuals -- factory workers, rural villagers, and a millionaire entrepreneur -- caught up in China's dramatic, ongoing effort to modernize its economy. Through their intimate personal stories, camera work capturing the unique feel of their cities and homes, and with a soundtrack that includes Chinese rock music reflecting the rawness and energy of a nation in great flux, "China in the Red" offers a view of China that is rarely seen in the West.

"People in the West tend to view China as an impenetrable, alien culture, but we have far more in common than most people think," says producer/director Sue Williams in a behind-the-film interview. "We wanted to show this and the huge changes taking place in China by filming ordinary Chinese citizens over a period of years. And almost everyone we asked agreed to open their homes and their lives and share their stories."

Feng Hui-Xiu is one of those stories. Stress is etched all over her face. For 28 years, the 44-year-old factory worker has worked at Beijing's sprawling Number One Machine Tool Plant. But the Chinese Communist Party has ordered all state-owned companies to become modern, profitable enterprises or face being closed down. For Feng Hui-Xiu and tens of millions of Chinese workers like her, the future is very uncertain.

To make Feng's situation even tougher, as the manager's assistant she often has to deal with frightened, angry -- and sometimes violent -- workers and colleagues who have just been laid off from the only jobs they have ever known.

"There have been so many cases like this: people sprawled all over, pouring their hearts out, threatening us with cleavers," says Feng, who is one of the more than 1 billion Chinese citizens who have been caught up in the sweeping transformation of their country into a global market economy.

"China in the Red" begins in 1998, when the mood is both fearful and optimistic. People brace themselves as the government announces that all state factories have just three years to adopt modern business systems, a move that will result in layoffs of millions of workers. Even trained workers are fearful of the changes unfolding around them.

But not everyone is apprehensive. Amid the factory closings, massive layoffs, and worker protests, some, like Zhang Wu, are capitalizing on the new economic realities and thriving. In just a few short years, Wu has gone from working at a state-run packaging company to owning the most successful corporate image company in China. The film shows how his personal life changes dramatically, too. In 1998, Zhang and his wife and their child are sharing a cramped apartment with his in-laws; just two years later, the family has moved into a luxury penthouse apartment in a gated Beijing community.

Zhang is open about his capitalist dreams. "My next apartment will be even more comfortable," he boasts. "When it comes to housing, my ambitions are boundless. As long as you have money, you can do anything."

Tian Xiao-Wei has also benefited from China's economic reforms. For most of her life in the small, rural Chestnut Flower Village, Tian felt despised by her neighbors. Then she started her own small business making and selling noodles. She is now one of the richest women in the village, with high social-standing and respect.

"Now you can do anything," she says, "and no one will be against you as long as you make money."

But not everyone is doing so well in China's brave new economic world. In the gritty northern industrial city of Shenyang, stockroom worker Zhang Shu-Yan struggles to adapt to the new workplace expectations at the Shenyang Machine Tool Company.

"Before the reforms, it was different," she says. "I could do the work or not do the work. If I wanted to do it, I did it. If I didn't want to do it, I didn't."

For decades this attitude was common among Chinese workers. "We have to change the way people think," Shenyang Mayor Mu Sui-Xin tells FRONTLINE. "Under the planned economy, every aspect of workers' lives was managed by the government. In the market economy, you're responsible for yourself."

The documentary follows the tough, charismatic mayor on a relentless schedule as he rushes from meeting to meeting, trying to arrange loans and broker deals that might help create jobs for some of the 1.3 million unemployed workers in this city of 8 million. He admits that the near-term future doesn't look very bright.

"We estimate that 450,000 people will be laid off this year," Mayor Mu says. "Where are they going to find work?"

There is no easy answer. Over the four years covered in "China in the Red," nearly 34 million Chinese workers lose their jobs while most state-run factories continue to hemorrhage red ink. Worker protests grow more widespread, as does the cynicism regarding the rampant corruption that is escalating with the economic reforms.

"Some managers of state-owned companies have done terrible things to ordinary workers," government economist Wu Jing-Lian says. "For instance, in some places they sold the company to officials, relatives, and friends without giving workers any shares. In other places, they were even more greedy and made the workers pay to keep their jobs."

"China in the Red" chronicles how the unrest affects Shenyang, where a major scandal erupts over alleged government corruption and reaches all the way to Mayor Mu Sui-Xin. In a startling reversal of fortune, the once-rising political star is convicted of accepting bribes and kickbacks and is sentenced to death.

Yet even as Chinese citizens struggle to change and survive in the new economy, they also are trying to save what matters most to them. Like parents all over the world, the parents profiled in "China in the Red" are desperate to provide a better life for their children, even as they despair over a generation gap made wider by their children's fascination with Western pop culture. One parent obsesses over her son's college exams, while another is devastated when her daughter abandons her education so she can work to support the family.

"My daughter likes to look at how nicely other people eat and dress. I want her to eat and dress well, but I can't afford it," says Zhang Shu-Yan, the Shenyang factory worker. In order to keep her job at the factory, Zhang has been forced to accept a pay cut and a demotion. She now cleans toilets for a living.

"My only hope," she says through tears, "is that my daughter can go to college and live a good life. Then I'll have finished my mission."


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