CHINA'S native chroniclers have long thought that Chinese history moves in circles. Anniversaries resonate with eerie significance, promising opportunities to celebrate progress but also reminding everyone of the possibility of repetition. Divining China's future direction at the start of the twenty-first century must begin with a reading of its anniversaries at the end of the twentieth. And China has seldom experienced a year so replete with the contradictions of overlapping, politically potent anniversaries as 1999.

For China 1999 was the eightieth anniversary of the May Fourth movement, when the Chinese intelligentsia first advocated the adoption of Western science and democracy. But it was also the fiftieth anniversary of the establishment of communism in China. And the twentieth anniversary of the beginning of the era of economic reform under Deng Xiaoping. And the tenth anniversary of the Tiananmen Square democracy movement and massacre.

Which anniversary means the most to China now? The May Fourth movement and the Tiananmen movement suggest that China is heading toward democracy, if haltingly. The massacre revives the grim spectacle of China as a fascist juggernaut. Deng's reforms herald economic freedom and the victory of business over ideology. But it may well be the anniversary of the establishment of communism that has circled back most unexpectedly.

Tiananmen was commemorated last June at Harvard University, where the democracy movement's most influential student leaders -- Wang Dan, Shen Tong, Chai Ling, Wu'er Kaixi, and a dozen of their fellows -- were reunited, over dinner, for the first time since 1989. The centerpiece of all the events was a stirring speech by Coretta Scott King; remarks followed from Representative Nancy Pelosi, of California, and emissaries of Vaclav Havel and the Dalai Lama. Pelosi declared the movement to be at a turning point, with victory over the Communist regime in sight.

The message was bold and inspiring, but the reality is more complicated. Pelosi has been the dissidents' stalwart ally since 1989, when she first championed their cause in Congress, but since then her influence on this issue has waned on Capitol Hill. So has the clout of the dissidents themselves. During the 1992 presidential campaign they basked in Bill Clinton's good will, but today they must settle for a presidential candidate with more dubious prospects -- Gary Bauer was the only other politician to join Pelosi at the Harvard events.

The dissidents, all exiles, are not just at a loss for new American political patronage; they have also become estranged from their own generation in China and from their Chinese successors at American universities. After Bauer and Pelosi left the Harvard events, a furious discussion in Chinese erupted among the dissidents, led by a woman who had just arrived from Beijing. "For ten years since Tiananmen I've fought to keep the movement alive underground in China," she complained bitterly. "But the only thing our classmates want to do now is make money. They're only interested in business!" At Harvard a few weeks earlier a public meeting of Tiananmen leaders had been marred by a volley of angry questions that a younger Chinese Harvard student aimed at Wang Dan. He blamed the students of 1989 for creating a bloodbath and setting democracy in China back, not moving it ahead.

China experts friendly to the Tiananmen dissidents have begun to admit that the movement is of questionable significance for China today. An especially pessimistic assessment came from Chantal de Rudder, a senior editor at Le Nouvel Observateur, in Paris, who had befriended the student leaders in Beijing in 1989. De Rudder had just returned from a long stay in China, so I asked her at the Harvard dinner what she made of Pelosi's optimism about the democracy movement. "In China now there is no nostalgia for 1989," she replied. "Even liberal intellectuals in China have done well by the economic reforms. They don't want to upset stability. They want gradualism." Casting an eye over the assembled dissidents, De Rudder shook her head sadly. "These activists are doing what they can, but it doesn't mean a lot. For the moment they have no influence in China."

Around the corner from where the anniversary dinner was held are the offices of the nation's most distinguished institute for Chinese studies, Harvard's Fairbank Center for East Asian Research. The center is named for the late John King Fairbank, widely admired as the father of Chinese studies in the United States. The director of the Fairbank Center, Elizabeth Perry, a professor of government at Harvard, considers herself a friend to China but harbors no illusions about the regime. Her specialty is Chinese popular protest from the nineteenth century to the present day. Perry's work suggests that resistance to the Communist regime today often has less to do with advocating an American-style political system than with reviving communism.

is a contributing editor and the acting managing editor of magazine, at Harvard University. His essays and reviews have appeared in and

The Atlantic Monthly; February 2000; China's Blue Collar Blues - 00.02 (Part Two); Volume 285, No. 2; page 20-33.

WHILE the Tiananmen generation reflects on the past promise of democracy, a new generation of Chinese students, both at home and abroad, is looking ahead to the overwhelming challenges facing China in its risky bid to move toward a market-based economic system. Unlike their predecessors, these young Chinese tend to favor working within the limits set by the regime. Like their predecessors, they are dreamers -- but they're keeping at least one eye open. They know that in the short term the crux of China's future is those 24 million excess workers. To their credit, though many of them are studying in the United States, they are keen to return to China and make a difference.

Yet the system within which they are so eager to work is hopelessly mismanaged. Perry Link, of Princeton, and his colleague Liu Binyan, one of China's most seasoned independent journalists, wrote a scathing critique of Chinese "reform" for The New York Review of Books in 1998. They used the research of an unorthodox economist named He Qinglian, whose work made a bad joke of the idea that economic reform in China has led to anything that deserves to be called progress. Officials in charge of implementing economic change were never made accountable to the people through accompanying political reforms, so the entire system became corrupt. The result, the economist showed, has been not the production of wealth but simply its transfer. The growing "free" market in China is mostly about well-connected entrepreneurs speculating with public funds, pocketing the profits, and assigning the losses to the state. When Chinese workers pen Marxist manifestos and take to the streets against their new capitalist oppressors, it is these government opportunists about whom they are up in arms.

Contrary to conspiracy theories about a small clique of robber barons, however, just about everyone in China's burgeoning middle and upper classes is implicated. When I lived in China, in the late 1980s, ordinary transactions were for my Chinese friends a matter of identifying the government official who could help and slipping him something under the table. David Goodman, a China expert in Australia, has documented such corruption extensively and concludes that as long as the Communist Party remains committed to its version of reform, Chinese citizens who are making money have a vested interest in playing along. "Far from being alienated from the party-state or seeking their own political voice," Goodman writes in a chapter of The Paradox of China's Post-Mao Reforms (1999), the new middle classes "appear to be operating in close proximity and through close cooperation" with the government. Laborers in the ailing state-owned sector, who number somewhere around 70 or 80 million, are clearly losing out, as the wealth they produce is squandered on the one hand and the security they have enjoyed is revoked on the other. China also has at least 70 million workers toiling in semiprivate industries in townships and villages. Several million more work in enterprises financed by capital from outside mainland China. Martin King Whyte, a sociologist at George Washington University, studies how workers in these latter two groups are faring and compares their plight with the worsening lot of state employees.

"Working conditions in TVEs [township and village enterprises]," Whyte has written, range "from paternalistic to dreadful." In 1994 China passed a labor law relating to such enterprises that specified workers' rights, in terms of maximum hours per week, maximum overtime, minimum wages, and the like. But the law is widely ignored, particularly because many of the workers in these factories are rural migrants who are thus a long way from home and easy to exploit. Their working conditions are appalling: toiling twelve hours a day or longer, seven days a week, they operate unsafe equipment and have accidents at high rates, meanwhile earning miserable pay. Injured workers are simply replaced, and arbitrary wage reductions and firings are common. In most factories financed from outside mainland China the picture is even worse. About 80 percent of such enterprises are established with capital from Hong Kong, Taiwan, and South Korea; they exhibit the harsh regimens and abusive treatment of the stereotypical sweatshop.

IF China's private sector can keep growing enough to absorb excess labor, and if economic-cum-social solutions similar to those advanced by the emerging post-Tiananmen elite succeed, a long-term transition away from repression and toward a regulated capitalism could well get under way. Enough new laws have been passed that Chinese citizens are now able to sue government officials over unfair treatment, and they are beginning to do so; on the village level elections are being instituted that might eventually provide a model for the country as a whole.

If, on the other hand, China's economy falters while masses of workers are laid off, the prospects are bad. Since a nationwide revolution against the status quo seems unlikely, worker revolt would probably result only in a protracted war of attrition by the government. The recent crackdown on the religious sect Falun Gong would look like a mild warm-up exercise by comparison.

The United States can do very little to affect the trajectory of Chinese history, but what it does do could be significant. Western corporations that subcontract in China with unscrupulous East Asian operators should be called to account, and human-rights organizations must continue to monitor the plight of Chinese labor. But cutting off direct U.S. business dealings -- whether investment or exports -- with China, as many human-rights activists demand, is likely only to pamper our consciences at the expense of desperate Chinese workers. In the short term, by joining the World Trade Organization, China does risk increased layoffs, owing to international competition. In the longer term, though, the more Westerners there are doing business in China (like Carl in his factory), the better Chinese working conditions are likely to become. Punishing China economically in an effort to encourage American-style political change could, by undermining the power of economic reformers, have quite unintended consequences. "If China's elites once again fragment into conflicting factions," Martin Whyte writes in The Paradox of China's Post-Mao Reforms, "it is not unlikely that more-conservative leaders will denounce exploitation of workers and attempt to recruit proletarian support for their cause." In attempting to kill off the last vestiges of Chinese communism, the United States would have orchestrated the rise of old-school Marxists instead.