I have spent the last week in China – most of it in Tianjin and a little of it in Beijing. Jack Pirozzolo, one of our Partners, and I have toured massive industrial parks, visited a high-tech incubator that is incubating 930 companies (and it is just one of several equally large incubators), met with the General Managers (read CEO) of pharmaceutical companies, government officials, and senior partners at various law firms, eaten multicourse lunches followed by multicourse dinners, and drunk Chinese wine to excess. It is a great story.

What I have seen is exactly what you might imagine, a huge economic engine. The scale on which new buildings are being built and new enterprises are being started is staggering. As I understand it, before the revolution Tianjin was once a small, sleepy seaside town where wealthy Chinese had second homes near the ocean. Approximately 25 years ago, the Chinese decided that they needed a major industrial city in the north to balance Shanghai in the south. In the intervening 25 years, China has built a massive city of 10,000,000 people. I don’t know how big it is in terms o f land, but it took more than an hour to drive from the center of town to one of its industrial parks. What you see is exactly what the newspapers say you will see – industrialization on a colossal scale and unimaginable speed.

Having done my four days of nonstop prospecting for legal work, I extended my ticket so I could visit Beijing and do some tourist stuff (after all who knows when I will have another chance). ON Saturday morning we hit the Forbidden City, which, frankly, was unremarkable when compared to Ankor Wat. But, for no reason other than it was nearby and it fit the schedule, we decided to visit the National Art Museum. The featured exhibit was a collection of paintings of ethnic minorities in China by various artists. The paintings ranged in date from the 1940s to 2005. While there is no question but that the more recent paintings demonstrated a more complex understanding of the various minority groups than the older paintings did, the general theme that pervaded the entire show was happy peasants in traditional dress cheerfully engaged in various agricultural or festive activities.

Presumably, the Chinese want to imagine the minorities that live under their control to be happy and quaint. But, as Jack pointed out, it doesn’t take a lot of exposure to the news to know that at least some minorities don’t feel that way. So, perhaps the most telling thing about this exhibit is what was not in the pictures. Being a peasant has to be a tough life. You are not likely to be out in a field reading the little red book and wearing brightly colored traditional garb with a bright cheery smile on your face.

If there are 16 million people in Beijing, 16 million people in Shanghai and 10 million people in Tianjin, exactly where are the other 1.25 billion souls, what are they doing, how do they fit into the economic and political picture? After one factory visit, we were running late and had to take a shortcut to get to the restaurant where we would have yet another multicourse meal. This detour took us through an older and undeveloped section of Tianjin. The street was not paved; it had potholes big enough for a small car to disappear into; it was lined with ramshackle stores. In effect it was the third world. I have recently had occasion to visit Uganda, and the unseen Tianjin is closer to Kampala than it is to Houston. Of course at the current pace of development, this situation will probably change in a hurry -- as far as Tianjin is concerned.

I still think China is a land of huge opportunity and growth, but it is not a simple story.