The dynamism and diversity of middle-class Shanghai do not support U.S. fear that China's development, illustrated by the explosive growth of its middle class, is largely the result of "state capitalism" and wholly negative, an article in the South China Morning Post (SCMP) has said.

As China's most westernized city prior to the Chinese People's War of Liberation in 1949, Shanghai has long served as a "laboratory" for evaluating the impact of transnational forces and the interaction between culture and politics, state and society, and East and West, Cheng Li, director and senior fellow of the Brookings Institution's John L. Thornton China Center, said in the article.

Shanghai was not only the cradle of China's modernization, but also the birthplace of the Chinese adaptation of communism.

Shanghai's distinct entrepreneurial spirit and cultural identity (known as haipai culture) quickly gained prominence after Deng Xiaoping's economic reform and opening-up took root in the 1980s and 1990s, Li said.

Meanwhile, many of the important changes that have taken place over recent decades – the establishment of a stock market, foreign investment, the rise of private firms, land leasing, property booms, and expansion of higher education – either began in Shanghai or have otherwise affected this born-again city in a deep, enduring way.

Shanghai's GDP rose from 2.69 trillion yuan (about $415 billion) in 2015 to 3.87 trillion yuan in 2020, with per capita GDP exceeding $23,000, according to its municipal government.

In 2020, Shanghai's CPI rose by 1.7 percent year on year. With 570,000 new jobs created in the city, the surveyed urban unemployment rate remained within 4.4 percent.

In 2018, over 5 million households in Shanghai shared this lifestyle and could be considered middle-class families, constituting 91 percent of the total registered households of the city. 

The average value of household assets among Shanghai residents was 8.07 million yuan, with a significant number of families owning two or three properties.

He also said the pervasive view in Washington about middle-class development in China is no longer one of hope for positive change but rather one of the fears that this development may undermine American supremacy and security. 

"Washington should neither underestimate the role and strength of the Chinese middle class nor ostracise and alienate this force with policies that push it towards jingoistic nationalism to the detriment of both countries and the global community," Li said.