SHANGHAI -- It was rush hour on Dec. 10 when the fog finally lifted. After a delay of three hours, approximately 30,000 people had massed at the Huangpu River ferry landing, late for work and impatient to board the first vessel that moved.

They fought each other to get on the first boat. In the resulting stampede, 10 persons were killed, crushed under the feet of other passengers. Six others died later in the hospital. More than 70 were seriously injured.

"People fell like dominoes," said an irate Shanghai citizen. "People were trampled to death. Their clothing was shredded."

The ferry tragedy has galvanized popular anger in China's largest city like no other event since the Cultural Revolution of the 1960s, and it has brought home the degree to which this great city has deteriorated.

From a Chinese point of view, the city has become a living advertisement for the downside of the country's economic reforms.

Its income and relative economic importance have been declining. In the past, the big complaint in this city of more than 12 million people used to be crowded living conditions. But now the key problem is transportation. What wears people down today is long hours getting to and from work on buses, where, Shanghainese claim, as many as 12 people often jam themselves into a square yard of floor space.

When a foreigner pointed out that it might not be possible to squeeze 24 human feet into that small a space, one Shanghainese explained that not everyone is able to get both feet on the floor of the bus.

In the ferry incident, a few people argue that those who fought to get on the boat have only themselves to blame because they failed to line up or show a minimum of discipline.

But nearly everyone blames the city government for the disaster, arguing that the police and ferry managers should have imposed discipline on the mob. And when people talk about the ferry incident, they think of other things that have gone wrong in Shanghai.

On a deeper level, Shanghai's biggest problem is money. It is running short of money to build, or rebuild, its most basic facilities. The city is to start building a subway this year, but no one is quite sure where the funds will come from.

The city government also is talking about building a bridge across the Huangpu River, and a second tunnel under it, but many citizens accuse the government of taking action only when matters reach the disaster point.

Until recently, Shanghai had done so little rebuilding that American movie producer Steven Spielberg had no trouble recreating the backdrop for his latest film, "Empire of the Sun," which depicts the adventures of a British schoolboy caught up in the chaos of World War II Shanghai. Today's Shanghai still looks like the old Shanghai.

Shanghai is supposed to be the leading industrial and commercial center of China, but for the past few years, other cities have been catching up, or, in the case of Guangzhou (formerly Canton), even surpassing Shanghai in a number of fields.

In a Shanghai newspaper, the World Economic Herald, a member of a city research institute wrote with surprising candor that if current trends continue, Shanghai's revitalization will prove to be virtually impossible.

The economic reforms that have benefited so many other cities in China have had a negative impact here, this expert said.

Shanghai is China's largest port, but the reforms have allowed many inland cities to make their own deals with foreign traders, thus avoiding reliance on Shanghai for shipping.

Shanghai is used to obtaining raw materials at low, government-subsidized prices. But reform has meant getting many raw materials at higher, free-market prices.

At the same time, Shanghai has been unable to raise the prices of many of its products, and the city must give the central government a greater proportion of its foreign exchange earnings than any other city.

In effect, Shanghai helps to pay for the modernization of much of the rest of the country.

For many months now, the city has been working to curb its bureaucracy, encourage foreign investors and build a new banking system. Some foreign businessmen say it is becoming easier to do business here.

But most people in Shanghai have a feeling that the city is slowing down rather than speeding up.

"Traffic is moving at close to half the speed that it was moving a year ago," said a foreign resident.

Mei Fangpan, deputy chief of the urban traffic division of the city planning commission, said motor vehicles in Shanghai move at an average speed of about 9 mph.

But the slow speed does not prevent accidents. Shanghai had a record number of traffic accidents in 1987 in which 811 people died and more than 6,000 were injured.

According to Mei, this is partly the result of economic reforms -- increased prosperity for some residents has meant more cars and trucks and crowded streets. To make matters worse, Shanghai has 4.5 million bicycles adding to the chaos.

At the same time, the reforms have allowed greater mobility, and large numbers of people from outside Shanghai -- an estimated 2 million a day -- move in and out of the city to do business or work on construction projects.

Despite all of this, many Shanghainese insist that they would prefer to live here than elsewhere in China because the city still has more schools, hospitals, shops and movie theaters than other cities.

Shanghai's great hope at the moment is for the development of Pudong, an area located opposite central Shanghai on the other side of the Huangpu River.

It was commuters from Pudong who were involved in the ferry incident, and some Shanghainese say the incident has discouraged people from considering a move to Pudong, whatever the incentives.

Planners hope to obtain foreign financing to lease land there and build a new harbor, trade center and exhibition center. At present, the population of Pudong is only 325,000.

"If we can expand that area, then Shanghai can be one of the trade and financial centers of the world," said one city planner.

But most of the time, it seems, all the average citizen can think about is his daily struggle with the overburdened bus system.

Take a bus at rush hour from downtown Shanghai and you'll understand why. The best way to get on is to hurl yourself at the door and try to secure a foothold on the steps. No one minds if you use your elbows. That's the way it's done.

On a typical rush-hour trip to the northern part of the city recently, a man who works in a downtown office spent nearly two hours riding three buses to reach his apartment building near a fetid stream filled with industrial waste. Once there, he needed a flashlight to go up his stairs because there was no lighting in the entrance to the building.

Once inside his cramped apartment, the man had to keep his winter clothes on because there is no heating in Shanghai in the winter.

But would he think of leaving Shanghai?

Never, he said.