"NAIL HOUSE" ROCK: PROPERTY PROTEST STIRS

C O N F I D E N T I A L SECTION 01 OF 02 BEIJING 002060 SIPDIS SIPDIS E.O. 12958: DECL: 03/27/2032 TAGS: PGOV PHUM SOCI CH SUBJECT: "NAIL HOUSE" ROCK: PROPERTY PROTEST STIRS PASSIONS, PROMPTS MEDIA BLACKOUT REF: BEIJING 1790 Classified By: Political Section Internal Unit Chief Susan A. Thornton. Reasons 1.4 (b/d). Summary -------------- ¶1. (C) A Chongqing family's refusal to abandon a building in the face of developers' bulldozers has captured the attention of Chinese media, scholars and netizens over the past week. The media have dubbed the building "the Nail House," referring to a Chinese term describing a person who refuses to leave property to make way for development. Dramatic digital photos of the house, which stands on an elevated spur of dirt surrounded by a construction ditch, continue to circulate widely on the Internet despite a March 24 State Council Information Office ban on all further media coverage. Contacts said the authorities imposed the blackout out of fear that the story could inspire others in the midst of property disputes to protest. Foreign and Mainland media have called the case the first test of China's new property law (reftel),but scholars cautioned that because the legislation does not take effect until October 1, 2007, such assertions are premature. Regardless, the telegenic owner of the property, Wu Ping, has become an instant celebrity, and the Chinese public's sympathies appear to lie squarely with her and her family. End Summary. For Whom the Ball Swings -------------- ¶2. (C) The "Nail House" property dispute has been simmering for some time, the official Legal Daily newspaper reported on March 22. The Chongqing-based Zhirun and Nanlong real estate companies want to develop the area, in the city's Jiulongpo district, into a shopping mall and apartment complex. The original structures were built in the 1940s and 1950s and Chinese press reports indicate the neighborhood was seedy and dilapidated. According to foreign media, the owner of the Nail House, Wu Ping, refused some RMB 20 million, or USD 2.6 million, in compensation for her building. In February 2005, after negotiations with Wu and her husband, Yang Wu, fell through, Zhirun and Nanlong asked the district's Housing Management Bureau to order the house to be evacuated and demolished. While the bureau deliberated, the wrecking ball swung and flattened the surrounding buildings. Wu and Yang stayed put, noting that they had just completed renovations to the building and the compensation offered was inadequate. The developers went ahead with digging the surrounding construction ditch. ¶3. (C) On January 11, 2007, the Housing Management Bureau issued a decision stating that Wu's house should be removed. But according to The Legal Daily, the decision document required Wu's signature -- which she refused to provide. The housing bureau then referred the case to the Jiulongpo District People's Court, which reached the same conclusion: the house must go. On March 23, Wu appealed the decision to the Chongqing Municipal High People's Court. In a Beijing Youth Daily article that appeared March 24, Wu acknowledged she is not optimistic about the outcome. It's "The Coolest" -------------- ¶4. (C) China's media sprinted with the story, with major dailies and Internet news sites running lengthy articles accompanied by dramatic photos. The high- circulation Beijing Youth Daily's March 24 account ran under a banner headline that read, "'The Coolest Nail House' Case Heads to Chongqing High Court." Bloggers got into the action by posting doctored photos and cartoons of the construction site. The tenor in online forums was very sympathetic to Wu, with the popular chat room portal Tianya replete with hundreds of comments on property issues. In fact, journalists, intellectuals and "just about everyone" is talking about "the Nail House" right now, said Wang Feng, an editor at the influential bi-weekly Caijing Magazine. He added that his magazine, which had a recent edition barred from publication partly because of its coverage the new property law, had been considering doing a piece about the dispute before the SCIO handed down its reporting ban. BEIJING 00002060 002 OF 002 ¶5. (C) Wang speculated that the propaganda guardians are concerned about coverage mainly because "it has grabbed the attention of too many people." He commented that, over the past several years, millions of regular Chinese citizens have been involved in property disputes. The authorities worry that individuals who have already settled on compensation will say to themselves, "why didn't we hold out?" Zou Xueyin, a professor at the Ministry of Civil Affairs Training College who focuses on good governance issues, separately agreed, adding that as China continues to develop, real estate disputes will only increase in number. The saturation coverage of "the Nail House" affair could spur others who are involved in such disagreements to engage in protest activity, Zou said. Local Officials in a Bind -------------- ¶6. (C) That the dispute is between a commercial developer and a private citizen puts the Government in a tight spot, Zou observed. If the project involved public works, such as building a hospital, a school or even a highway, the occupants would have less leverage. As it stands, the local authorities are reluctant to force the issue lest they seem to be working in league with the developer, Zou surmised. He added that officials are also likely considering the potential economic benefit the mall and housing complex could deliver to Jiulongpo district. In this context, given that the courts in most areas have little independence from the influence of powerful local officials, it is improbable that the occupants will get a fair hearing. Nonetheless, Zou said he has scarce sympathy for Wu and Yang. In his view, they are manipulating the situation for their own purposes -- they want to become stars, or at least very rich. "Remember, there are also hundreds of construction workers all waiting get started on the job," Zou said. ¶7. (C) Nonetheless, most netizens (and journalists) appear to admire Wu and Yang. While media outlets have bowed to the SCIO restrictions, it remains easy to find material, including digital photo spoofs depicting Yang as Superman, on Mainland blogs, said Wang of Caijing. Internet censors cannot possibly find and erase everything, he added. But Wang related that the coverage blackout has administered a blow to many reporters' morale. "We are all in a post 'Nail House' funk," mainly because it is a great story the media is not allowed to cover, he concluded. RANDT