BEIJING -- As Fang Xiaoxuan rode to work through rush-hour " traffic on the back of her friend's bike one recent morning, a thief unzipped her shoulder bag, slipped his hand inside and stole her wallet containing more than $300.

It was a brazen act before scores of commuters. Rare during the era of Mao Tse-tung, such bold thefts have become increasingly common these days on the crowded streets of China's capital. Fang, who cares for animals at Beijing's new aquarium, has had her money stolen five times in the past five years.

"I constantly run into thieves," says Fang, a bright, 23-year-old with broad shoulders from her days as a nationally ranked swimmer. "I don't know why."

Two decades ago, China was a tightly controlled, socialist country where government campaigns had practically wiped out drug abuse and prostitution. Since then, the nation's drive toward a market-oriented economy has dramatically improved living standards, but not without a price: As China's income gap grows, so does the crime rate.

Since 1990, China's crime rate has risen about 50 percent from 17.8 cases per 10,000 people to 26.8 last year, according to the Ministry of Public Security. Government officials estimate that migrants account for about half of all the urban crime.

As the government has loosened social controls, Chinese have increasingly engaged in a kind of class struggle Mao never envisioned. Millions of migrants have poured into China's cities seeking a share of the wealth. Frustrated, some have turned to robbery, burglary and theft.

The man who stole Fang's wallet -- later captured by police -- was a teen-age member of a gang of thieves from Xinjiang,

China's far western province.

"The society is in transition," said Shan Guangnai, a senior fellow in sociology at the Chinese Academy of Social Sciences. "In the past, people put more value on morality and now [they] are more focused on profit."

"With the development of the market economy, people have come to use money as the only measure of success and happiness."

In the past decade, Chinese have responded to the growing threat by installing devices previously never seen here, including steel safety doors, surveillance cameras, Plexiglas shields in taxi cabs, car alarms, steering-wheel locks and scanning devices to detect counterfeit bills.

Despite the increase, China's crime rate remains relatively low by U.S. standards and those of other transitional societies such as South Africa and Russia. Although petty theft is common and prostitution flourishes, most people still feel safe walking the streets of Beijing at all hours of the night.

Police have tried to bring crime under control by staging periodic crackdowns. In 1996, the so-called "Strike Hard" campaign led to tens of thousands of arrests and contributed to a record 4,367 executions for crimes ranging from theft to drug-dealing. The number of executions prompted strong criticism from international human rights groups.

Last spring, Beijing police sent some 70,000 migrants back home, but many returned. Faced with an increasingly mobile and freer society, Chinese leaders seem at a loss as to how to reverse the trend.

"The current situation in the social order remains grim," a report by the National People's Congress, China's parliament, acknowledged this month. "Criminal cases are still tending to increase, ugly social phenomena such as pornography, gambling and drug-abuse still emerge despite repeated bans."

Some of the problem with law enforcement seems to lie with the authorities themselves. Government leaders blame police, prosecutors and soldiers for a smuggling industry valued at more than $10 billion a year. In a recent survey in Hunan Province, nearly 70 percent of the respondents chose the police as the most corrupt municipal department.

To investigate certain crimes, officers sometimes expect payment.

A Beijing fish vendor and his wife recall one night several years ago when a group of people broke into his home and demanded money at knife point. The vendor, who gave only his surname of Wang, was stabbed 13 times before the gang fled.

During the attack, though, one of the assailants dropped his identification card, providing police with what might have seemed like a critical piece of evidence. When the authorities arrived, though, they expressed little interest in solving the case: the assailant lived in another province.

The wife, Zhang, said it became clear that if he wanted the case solved, he would have to pay the officers a stipend as well as finance their train tickets, food and lodging. After calculating the costs -- more than $500 -- the couple decided against it.

"I'm just a state factory worker," says Zhang, 43. "I earn just a few hundred yuan a month, how can I pay them such a large sum of money?"

"You know, in this 'money society,' you have no say."

Disinterest in solving crimes appears common -- even in cases affecting foreigners, who are often accorded special privileges in Chinese society. Last month, when a burglar broke into an American's apartment here, police initially seemed reluctant to investigate.

After some prodding, eight policemen arrived. The chief interviewer, however, spent much of his time literally picking his nose while other officers lounged in the living room, quizzing the owner on the cost of his antique furniture and admiring a photo of his wife.

"Is she Asian?" asked one of the policemen as he traced the woman's figure with his index finger.

China's Ministry of Public Security and Beijing's Public Security Bureau both declined requests for interviews.

Solving China's crime problem won't be easy because it is so closely tied to the nation's shift from a closed, egalitarian system to a more open and competitive one where the new rules often remain fuzzy.

Drug-abuse, basically eliminated under Communist rule, began

to re-emerge in the early 1980s after China opened its borders for trade with Southeast Asian nations, including Myanmar, a major heroin and opium producer. Corporate and finance law have yet to catch up with business partnerships that offer various opportunities for embezzlement and new stock markets rife with possibilities for insider trading.

The effects of economic change have also been felt in the countryside where, under the old commune system, water was viewed as a collective resource. Today, farmers can profit from the crops they grow and sometimes clash over water rights.

"They normally end up fighting with tools," says Wei Ping Xiong, a professor who studies crime at the Chinese University of Political Science & Law in Beijing.

While many have benefited from China's embrace of the free market -- racing toward middle-class lives replete with cellular phones and even cars -- the capitalist dream remains just that for millions of migrant laborers and the growing number of laid-off, state-owned factory workers. As long as the gap between the two continues to grow, crime will likely do the same.

"The economy," says Wei, "cannot keep up with people's expectations."

Pub Date: 9/24/98