For the most part, the police are out of sight, out of mind. My only real interaction with them has been when I got my Visa half a year ago, I had to register where I lived with the closest police station, then have them stamp some form. On the right is the police station closest to my house. There's some hoopty cars out front, but I think it's more common for Police to use newer Suzuki motorcycles, or to stay in their station until someone calls them.
Which isn't to say Shanghai is unsafe. Shanghai is an extraordinarly safe city, a city where your wallet gets returned with the money still inside, and little old ladies take the shortcut through the un-lit alley. Supposedly the worst cities in China are the Southern coastal cities like Canton, although I hear this from people who've never been there. And even those cities don't so sound bad.
That said, there are some crimes a more solid police force would counteract. In some Muslim areas you'll be offered Marijuana every several seconds. Prostitution and selling counterfeit items are basically de-criminalized, although there are occasional token raids. And most annoyingly, traffic patterns are completely crazy, with motorcycles and scooters ignoring all traffic laws, and carts veering out onto the road. You do see the occasional person get pinched, but it's the exception rather than the rule.
Just as in the US, some of the slack is taken up by Rent-A-Cops, who can veer from looking and acting all official, to some guy in a dirty jacket listening to Chinese Opera all day. It's probably less common than in the US, but you'll see Rent-A-Cops at banks, at malls, at the entrance gates to apartment complexes, and such. Also, most of the manned intersections will have "traffic assistants," rather than full-on-police.
With the kind of crime wave we have in my part of Oakland right now, Police State doesn't sounds like such a terrible thing.
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