Modern ChinaPolitical Aspects

Widespread Corruption and bribery

in China

after the Reform and Opening-up Policy (1978)

Corruption• Corruption is widespread in China in the post-

Mao era.

• After the Reform and Opening-up, as the economic benefits went up, corruption problem become even more serious in terms of both frequency and magnitude, and involve large amount of public money (頻率 , 次數及金額 ).

• According to an estimation made by the OECD, the amount involving in corruption in China could be as much as RMB 409 billion to 683 billion in the year 2004 alone.

Governance & Corruption

• The National Audit Office (NAO) started to make public announcement of its audit report of different sectors in the government in 2003, to reveal the problem of corruption to the public. A lot of officials were caught.

• This is known as the “audit storm” (審計風暴 ) in China.

Corruption• The Central Commission for Discipline Insp

ection (中紀委 ) of the CCP, and the newly formed National Bureau of Corruption Prevention (國家預防腐敗局 , founded in 2007) are also involved in the anti-corruption efforts in China.

• The situation seemed to be notorious and out of control (情節極其惡劣 ).

National Policies under leaders Hu and Xi

1.The importance of combating corruption and building a clean government (slogan: anti-corruption and pro-honesty 反貪倡廉 )

2. The CPC would be overthrown and the nation would be shattered (亡黨亡國 ) if the problem of corruption is not being properly dealt with.

Cases for reference only

Discussion (worksheet)

• Why are Chinese officials and cadres so accustomed to corruption?

Corruption with the Reform & Opening-up

• Activity 1

• Read the article “Privilege and corruption”: The problems of China's socialist market economy and review the reasons again.

• Brainstorm the reasons of corruption and decide which the major reason is.

• Hints:

Chinese culture, party-government

structure, temptation of power and money,

policies, loopholes in legal system and law

enforcement, etc.

1. Culture root view• A long tradition of placing personal connection

(Guanxi (關係 )) and Mianzi (面子 ) are two words in psychology describing the important behavioral pattern of the Chinese.

• The culture of sending gifts (送禮 ), paying for meals (請客 ) and doing a favour, etc. is seen as the social norm in China.

• It involved with building social network, personal power and fame and lubricant for work etc.

• They simply don’t see these as “corruption”.

Elaboration (for reference only)

• It has become a set of social norms in interpersonal relationships, people are just doing according to their customs.

• There are differences across culture. For example, you cannot ask the Spanish stop fighting bulls, or the Jews to stop obeying to the law of Moses, etc.

• If everybody do the same, this will not cause inconvenience to any particular person.

• It just shift the basis of comparison. Social network is also your great asset!

• Cost and benefits are calculated based on the fact that corruption exists.

2. Institutional problems arise from one- party rule of the CPC

• Under the one-party rule of the CPC since 1949- The system is designed with the goal to maintain

“one-party rule” under the State Constitution.• Lack of separation of powers in modern

concept- The executive is most powerful in carrying out its

policies and allocating of resources• The unrestricted / abused power of government

officials and party cadres – distribution of power

and resources in hand. (Power corrupts, absolute power corrupts absolutely)-The party cadres filled-in most government posts and were also top executives in many State-Owned Enterprises (SOEs) – controlled economic powers and resources-Temptation of economic benefits since 1979 - channels profits, economic interests and posts to themselves, relatives and proxies

- The mentality of “government officials and cadres being more superior than ordinary citizens” – corruption, exploitation, illegal seizure of land and properties for personal interests.

• Ineffective supervision and punishment of corruption

- Limitation in the institutional mechanism to supervise

the party and government as it is under the party and

executive itself!!

3. Failure in the political and legal system - The National People’s Congress (NPC) was limited

in power in supervising the Executive its members were also party cadres.

- The Judicial branch is also under the strong influence of the executive and unable to try certain notorious cases which involved powerful officials in CPC.

Why Bother?

美智庫：中國官員貪污嚴重威脅國家前景

• 美國卡內基基金會於 2007年發表的報告指出，中國官員貪污問題將對中國未來經濟與政治穩定帶來嚴重威脅。報告稱，每年大約 10%的政府支出、合約以及交易費用，成為給予官員的回扣或賄款。報告又指，因貪污官員中僅有約百分之三被判刑，貪污遂成為「高回報、低風險」的行動。

Consequences of corruption in China1. Economic losses

Decreasing foreign direct investments (FDI) due to loss of confidence (unfavourable investment environment in China)

2. Weakening of global image e.g. national and investment image Global society will have a negative impression

towards China’s governance

3. Loss of national property National fund has been stolen or squeezed by

those political leaders or party cadres

4. Political impact

- misused/wasted resources/capitals by local officials; and the tendency towards boasting and exaggeration (浮垮浪費 )

- A lot of taxes and surcharges levied by local government and functionaries (地方部門 )

- Illegal confiscation of farmland and properties & unfair compensation to peasants/social grievances

5. Social unrest

•Huge social inequalities, arouse public grievances and anger and peoples loss their trust to CPC and government

•Threatening of social stability and harmony (和諧局面 )

•Peoples’ expression is getting more violent, e.g. large scale riots and mobilization (大規模的騷亂和動員 ) since they are experiencing more social unfairness and exploitation & violence by government.

Discussion (Optional)

• “If everybody corrupts, corruption becomes a norm and there is no need to fight against it since it is just part of the culture.” Do you agree?

• Share your idea with the class.

Agree

• Corruption has become a set of socioal norms in interpersonal relationships, people are just doing according to their customs.

• It was so deeply entrenched that all people involved and this will not cause inconvenience to any particular person.

• Corruption can bring benefits like lubricant and social network which are also one’s great asset!

• Cost and benefits are calculated based on the fact that corruption exists.

Disagree

• It makes it hard for foreign countries to do business with China.

• Corruption is unfair. It benefits the rich.

• Public funding will be squandered.

• It makes governance inefficient, and government officials not trustworthy. People will be dissatisfied with the government.

• It will enhance economic disparity.