'If I go back and they do something to me, no-one will ever know'

THE FIRST TIME YIYUN LI SAW A GROUP OF PRIS- oners on their way to execution was when she was five.

In A Thousand Years of Good Prayers, which last year won the world's top prize for a collection of short stories, Yiyun Li does a lot more than merely explore the kind of things those counter-revolutionary hooligans might have done. These are stories of immense brilliance and subtlety, skewering the bitter realities of everyday life not only under Mao but under his successors' great leap forward into bare-knuckle capitalism.

In the future, historians will look back on China's first steps towards superpower status as the most important economic transformation since the Industrial Revolution. For what those changes mean to ordinary Chinese people right now, they will read Li's stories of old men meeting for tea in the cafs outside the nascent stock markets; young men dreaming of a new life in the US, able to send back money to their relatives; old women left without a pension by the collapse of state factories or perhaps finding jobs as maids at the country's first private schools. They'll be raked over too by social historians charting attitudinal change: when the young first began kissing in public without fear, when women dared to disagree directly, when students saw their first American film.

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But that's not the only reason Yiyun Li is worth reading. Like her favourite writer, William Trevor, she perfectly captures nuances of thought and action in her stories, dropping the reader into immediately believable worlds. She has been published in the New Yorker and the Paris Review, and won a shoal of literary awards including, most recently, the 50,000 Frank O'Connor Prize, awarded in Cork last year. "She is," Salman Rushdie points out, "the real thing." She's also a mere 33 years old and - most astonishingly of all - only started writing in English six years ago.

Despite all that, any day now an envelope could drop through her letter box in Oakland, California, informing her that her second appeal for a green card has been turned down. If she is declared an illegal immigrant, she, along with her husband and two young sons, could be put on a plane back to China. Her perilous legal status in the US was underlined last October when she was unable to pick up her prize in Cork: she didn't dare attend the ceremony in case she was refused entry on her return to the States.

In theory, the US does allow foreign artists of "extraordinary ability" to live there; in practice, this is interpreted impossibly narrowly. Being the world's contemporary Chekhov, its modern Maupassant, does not, it seems, count for much.

The irony is that if she really was a dissident, if she wrote crude anti-communist propaganda instead of wonderfully humane short stories, Li would automatically qualify for an officially sanctioned, hassle-free existence in the US. That would probably have happened too if she had carried on with her post-graduate studies in immunology at Iowa university: the US has no problem admitting scientists working "for the national interest". The overwhelming majority of Li's classmates from her elite Beijing state school are already working legally in the US under precisely those terms.

The problem is, Yiyun Li is not really a dissident. She has lived in the US for the last ten years but won't turn her back on China. Her parents still live there, and one day she'd like to go and see them.

Will it ever happen? "I don't know," she says. "Even though I refuse to allow my book to be translated into Chinese, I don't know how it will be accepted in China. But I am a Chinese citizen, and if I go back there and they do something to me, no-one will ever know. Even naturalised Americans have been back and arrested for all kinds of ridiculous reasons. There's always this worry for Chinese intellectuals overseas: it's not always safe for us to go back."

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As to why that should be, let's consider "Son", one of the stories in the collection, about a Chinese software engineer working in America who goes back, after ten years, to Beijing. His mother, a former party member, has become a Christian after her husband's death and has for years been trying to marry him off. He's never told her that he is gay.

So he wanders into an internet caf and tries to log on to a few gay chat rooms before he realises that the internet police have blanked them all out. After arguing with his mother about her new-found faith, he accompanies her to church. He doesn't go in, and when his mother tries to bribe some beggar children to attend the service with her, he gives them twice the money not to. He sits in a Starbucks across the road, from where he hears an accident outside: there are so many these days, he notes, because corruption has grown so endemic that the newly-rich get other people to take their driving tests for them. And the beggar-children, who have been run down - well, there's an inexhaustible supply of them too.

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There, within that one story, is both a metaphor for Li's plight (Americana on the Starbucks side of the street, Chinese tradition on the other, an accident in the middle) and an example of why the Chinese authorities would dislike her fiction. To them, "Son" - with its child beggars, Christianity, censorship, corruption - would read like an indictment of the regime. To us, these are almost incidentals. Like its companion piece, the title story in which a Chinese girl in America is visited by her ageing father, it's really about love: "It takes 3,000 years of prayers to place your head side by side with your loved one's on the pillow. For father and daughter? A thousand years maybe."

It is, Li must know in her heart, asking too much of the authorities to realise that "Son" is a beautifully constructed tale about the love between parent and child. They have a catch-all phrase for those who say the regime isn't the best of all possible worlds. They call them "counter-revolutionary hooligans", and she's known what happened to people like that ever since she was five.

WHEN, I ASK, DID SHE LOSE HER CHILD'S FAITH IN the regime? I thought I could guess the answer: Tiananmen Square happened when she was a 16-year-old at a school 15 minutes' cycle ride away. It was an elite school for the brightest and best, surely the most likely to be enthused by the possibilities of democracy.

But her discontent had other roots too. "When I was 12 or 13 I never thought for a moment that we didn't live in heaven. We were taught to look up to our teachers because in some way they represented the state, yet a couple of them were, I now realise, child molesters. With one of them, I just thought he liked me a lot, but he touched me inappropriately - not just me but other girls too."

Before then, there'd been other seeds of doubt. At Beijing's Friendship Hotel, where foreigners lived in luxury denied local Chinese, she'd seen a couple of white children riding around on tiny bikes with stabilisers. A small seed of envy; but bigger secrets would feed her discontent - and the family had no bigger secret than that her mother's two brothers and her father had fought on the "wrong" side in the civil war between the nationalists and communists. In 1949, after the nationalists' defeat, one officer uncle had fled, with his shattered army, to Taiwan. They didn't hear from him for another 40 years. "My parents would say, don't ever talk about him. We were trained early on to keep secrets."

All the same, by the time she was 13, there were distinct signs of a new openness. "Between 1985 and 1987, there was a huge wave of translating western philosophers. I got to read a lot of them - Sartre, Camus, Rousseau - and it was a fundamental part of my education," she says.

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When the Tiananmen Square demonstrations broke out, Li realised she was witnessing a key moment in Chinese history yet she was too young to participate. After school, she and her friends would read the posters on the college walls, and visit the demonstrators. She was particularly moved by a group of middle-aged men standing quietly by the roadside. The placards round their necks read: "We have knelt down all our life. This is our opportunity to stand up as human beings." Her parents told her not to be so idealistic, that the troops would soon move in and kill the students.

After that happened, her school was closed for a week. A friend who had been there in the square on the night the tanks moved in told her how the demonstrators had been crushed in their tents. A month later, he was taken away by the police. No-one knew who could be trusted.

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Officially, there'd been no massacre. That's what the television news had said on the night it happened, but all Li's friends knew someone who'd been killed.

Along with all her classmates, she had to sign up for a year of political re-education in the army before being allowed to study at Beijing University. One day, she forgot her mother's injunction ("Imagine a zipper on your mouth. Zip it up tight") and told her squad the real story about Tiananmen Square. Although the squad leader reported her, his superior officer decided to take no action.

Only in America, however, did the fetters on her thought start to fall away. As she learnt to write in a foreign language, so she began to express herself more freely - not just about politics but everything else too. At last, she didn't have any secrets to keep, whether about her mother's counter-revolutionary uncles or the students who died in 1989. In English she could, like the Chinese-American woman protagonist of her title story, start afresh, with a more direct way of talking and thinking.

"Baba," the woman tells her father, "if you grew up in a language that you never used to express your feelings, it would be easier to take up another language and talk more in the new language. It makes you a new person."

A new person, and a great writer. And if her old country and her new one don't realise that, their loss is enormous.

A Thousand Years of Good Prayers by Yiyun Li is published by Fourth Estate, priced 14.99.