A March 1999 report from U.S. Embassy Beijing
Summary: Many ministries and local governments put their own self-interests ahead of the national interest. China in economic transition does not have a free market but a “market economy controlled by the administrative departments? that hinders sustainable development initiatives. The widespread falsification of statistics confirms the Chinese saying “officials make statistics and statistics make officials? Wise government macroeconomic planning is essential for wise sustainable development. But this is impossible if, as many Chinese say, “the crooks and the cops belong to the same family? Many good officials are fired for standing up for the public interest. In part 5 of a summary translation of “Grave Concerns? two Chinese Academy of Social Sciences researchers conclude that “power?pollution is the worst kind of pollution. As long as power is above the law, the environment will suffer. Amidst the environmental gloom, however, are the many bright points of light in the rising generation who understand China’s deep structural problems and are determined to speak out and work for fundamental change.
“Grave Concerns -- Problems of Sustainable Development for China?[Shendu Youhuan -- Dangdai Zhongguo de Kechixu Fazahan Wenti] is a volume in the influential China’s Problems Series. “Grave Concerns?was published by Today’s China Publishing House in October 1998. Authors Zheng Yisheng [STC: 6774 2496 3932] and Qian Yihong [STC: 6929 5650 4767] are the Vice Director and the Secretary-General of the Environment and Development Research Institute at the Chinese Academy of Social Sciences.
The thread running through many of the China’s Problem’s series is that it isn’t just bad people, or bad policies. The problem is much deeper: the problem lies in the political and economic system. As Zheng and Qian remark in their book, the suppression of the social sciences in China until just a decade or so ago has made it hard to incorporate scientific understanding of society into policy making.
A rising generation of Chinese sociologists, anthropologists and demographers linked to worldwide academic networks is now changing that, however. They are improving policy advice to the Chinese government. Many of the books in the China Problem’s Series were written by PRC government think tank researchers. Premier Zhu Rongji has recognized how the abysmal state of Chinese statistics drives down the quality of policy decision making. Addressing structural issues in the Chinese economic and political system (as we see in “Grave Concerns? may make it possible for fundamental changes such as vigorous enforcement of environmental regulations at all levels and reducing the widespread corruption in Chinese society and government. The rise of a new generation that understands the problem, is moving into policy making positions, and is willing to speak out is one of the brightest spots in the Chinese environmental picture.
“Grave Concerns?combines high quality information and deep analysis. The book echoes many of the views of China’s leading scientists which Embassy Beijing Environment, Science and Technology officer has heard in conversations with Chinese scientists and read in scholarly books and periodicals. An example: ?I>Status and Development Strategy of China’s Resources? [Zhongguo Ziyuan Taishi yu Kaifang Fangluue] published in December 1996 by the Hubei Science Publishing House. “Status and Development Strategy? is part of the Man and Nature series edited by then Chinese Academy of Sciences President Zhou Guangzhao. The authors, He Xiyu [STC: 0149 1585 0710] and Yao Jianhua [STC: 1202 1696 5478], who examine water, grassland and water resources, agriculture (including detailed studies of grain, cotton and sugar policy), and marine resources come to largely the same conclusions as the “Severe Hardships?authors.
This Chinese Academy of Sciences volume on environmental and natural resource economics, for example, in its conclusion “Resources Management? [p. 561 - 573] attributed much of the chronic waste of resources and pollution in China to the collective property system. In dispassionate academic language the message comes through clearly: the problem is the communist system. Under the collectivist ownership in which users do not compensate owners for the use of a resource, there is little incentive for anyone to play the owner’s role of conserving and investing in resources. The solution (p. 565) is to create a market and to allow the transfer of private property rights (or usage rights) to natural resources.
“Status and Development?is less directly critical than “Grave Concerns? of big projects yet with a careful reading its message does gets across. For example, the chapters on water resources and energy do not mention the highly controversial Three Gorges Dam [pp. 555 - 556] The Three Gorges Dam, along with a planned south-to-north water transfer project [Nanshui Beidiao], is mentioned unfavorably in the chapter “Resources Development and the Environment? Criticisms of the Three Gorges in the Chinese Academy of Sciences volume include the difficulty of settling people displaced by the Three Gorges Dam in other, already overcrowded areas; rapid silting up of the dam; increased pollution before the dam with the slowing of water flow rates among other problems. [Comment: Most recently reports in the Chinese press reflect concerns of Premier Zhu Rongji about the quality of the Three Gorges projects and other big projects. See the March 1999 U.S. Embassy Beijing report Three Gorges Project on the Defensive? Could Premier Zhu be listening to some of the scientist critics of the Three Gorges who have had to lie low while Li Peng was premier? End comment]
Two Chinese government officials told Embassy Beijing Environment, Science and Technology officer that China is now moving towards a private property system but this can’t be said openly for political reasons. The officials said that in the traditional Chinese way of keeping the old names but gradually changing the meaning of the names, China would eventually switch to a private property system. [Comment: A change to a private property system would sap the already battered legitimacy of the Communist Party. The Communist Party in Chinese is literally the “collective property party?(gongchandang). End comment]
This view of the officials and the authors of the Chinese Academy of Sciences natural resources volume discussed above that the collective property system is at the root of many of China’s problems seems to be held fairly widely. According to a February 28 South China Morning Post article, Chinese economist Cao Siyuan, father of China’s Bankruptcy Law, prepared for the National People’s Congress a proposal that the Communist Party should change its name to the Socialist Party. Referring to President Jiang’s statement that achieving communism will take tens of generations, Cao proposed that the Party change its name so that people tens of generations in the future can decide for themselves whether to be communist or not. According to Cao, the name “Communist Party?(with its literal meaning in Chinese of “collective property) creates uncertainty about the safety of private funds so “bosses of private firms and top party and government officials keep assets offshore to provide an escape route?
Radically reinterpreting principles in the name of “socialism with Chinese characteristics?or other need of the present powers didn’t start in 1949. Keeping the old names while radically re-interpreting their meaning so as to use the authority of the ancients to legitimize innovations has a long tradition in China. Ancient Chinese philosophical and medical texts when compared with the widely differing commentaries on the texts written in different dynasties illustrate this. The famed Chinese political commentator Confucius 2500 years ago made the rectification of names (“zhengming?which means that that the names and their meanings should coincide. If not, the names should be rectified so that they do) the main theme in his philosophy in order to guard against this tendency in Chinese society and thought. Presumably Confucius would side with the Chinese economist Cao Siyuan’s modest proposal.
Page numbers in the summary translation below refer to the first edition of “Grave Concerns?/I> published as a volume of the China’s Problems series by the Today’s China Publishing House [Jinri Zhongguo Chubanshe] in October, 1998.
Additional background information on Chinese environmental issues can be found among the ninety unclassified Embassy Beijing reports posted on the U.S. Embassy web page at http://www.usembassy-china.gov/english/sandt/index.html Some informal translations from the Chinese press bearing on the Chinese environment are available at http://www.usembassy-china.gov/english/sandt/sandsrc.htm Several reports on new path breaking books available in Beijing is available at http://www.usembassy-china.gov/english/sandt/bjbkwrm.html
SUMMARY TRANSLATION BEGINS
In sum, the divorce among the elements of China’s administrative framework is incompatible with China’s sustainable development. This is the basic contradiction encountered in moving from ideas about China’s sustainable development to their implementation. [p. 270]
Why can’t Chinese government departments coordinate their policies? Why is it that local government can ignore national laws? These questions go to the heart of the deep structural problems China has. China doesn’t have a planned economy. It doesn’t have a market economy. It has a “market economy controlled by the administrative departments? This transitory stage in China’s developments has serious disadvantages for China’s sustainable development. [p. 271]
The problem of mixing of government and business not only affects the economy but damages sustainable development as well. As government participation in business grows, companies act more and more like government bureaucrats looking for short term political achievements. This seeking for short term gains during the term of a given bureaucrat causes ever greater problems. As one official said, “What a capitalist seeks is money in his pocket. What we want is an achievement we can write on a piece of paper.?/P>
Why are the development departments so strong and the environmental protection departments so weak? The answer is the relative strengths of those departments is not determined by law but the will of the government leadership. Local government that lean towards development warn the local environment authorities “Don’t get in the way!?and even fire officials who dare to do their duty. Very few local governments give the environmental protection departments a veto power over development. Local governments often do not tell the environmental protection departments until it is well advanced. Their failure to give authority to the environmental departments shows what these local governments really think about sustainable development. [pp. 271 - 272]
[Note: Over the past year more and more articles in the Chinese press have noted the link between corruption and the structure of the Chinese political and economic system. The article The Pathological Expansion of the Selfish Interests of Government Departments and the The Causes of the Pathological Expansion of the Interests of Government Departments appeared in Southern Weekend [Nanfang Zhoumou] a nationally-circulated Guangzhou Communist Party newspaper which is more critical than most. End note]
A study of the implementation of the Statistics Law carried out in late 1997 by the State Statistical Bureau, the Supervisory Department [Jiancha Bu] and the State Rule of Law Bureau found 60,000 instances of illegal statistics, half of which were deliberately falsified. Local officials falsify statistics to look better to superiors. Statistics for the township and village enterprises are often falsified. One example is how in late 1995, the fixed assets of the township and village enterprises was cut by 40 percent to the remove inflation from their statistics. [pp. 273 - 274]
[Note: Article denouncing the faking of statistics appear frequently in the Chinese press. An example is the article translated at Leaders Water Official Statistics -- Only Official Careers Benefit ]
The division of labor among government departments depends entirely upon the needs of society. But for various reasons these departments are increasingly concerns with their own bureaucratic interests. This creates a situation in which "the interests of the government department are placed ahead of the national interest? This is seen in the power struggles between government departments and even in the exchange of power for money. The true work of government becomes a mere secondary matter. [p. 274]
Yet reform of the government itself is the aspect of Chinese reforms that lags the furthest behind. Many government organizations are not really cutting personnel. They are just converting government functions into fee for service. The more obvious issues such as how to collect fees, licenses and spending money on big projects are getting attention. But what is in the end are the bigger and more important issues are being swept aside. These include establishing and then strengthening the rule of law, resolving conflicts of interests, and studying policies for handling potential future crises. [p. 275]
Now for years people have been calling for the establishment of regional bodies with real authority to handle large regions such as river basins that cross administrative boundaries. If there is any response at all, it has been to set up some organization that has no real power. The basic problem is the so-called division of labor is really a divorce. This not only true between departments but also between divisions within a department. Each department has its own area to manage, each is subordinate to a particular province, city or county organization), each its own goals and responsibilities, and each its own separate source of power. Therefore is it any wonder that the great variety of uncoordinated policies, orders and directives are hard for units at the grassroots to implement?
Where there is money to be made there is a great duplication in organizations -- what the people call “Paying the water bill to twelve different departments? Government departments have become interest groups first and public servants second. Better policies are not the answer. Unless the problem of government departments acting as interest groups is not addressed, any reform will just be a matter of departments negotiating how under the new, perhaps very different arrangement, “no department will be worse off than before? and the interests of the people and the long-term interests of society will come second. [pp. 275 - 276]
Honesty and sustainable development are directly related. Macro level adjustments and investment planning are indispensable methods for sustainable development. Yet if these powers are captured by a department or an individual to use as its own political or economic capital, much confusion will be introduced into the process. A big problem in China today is the environment in which public funds are used. A minority of the officials in some departments team up with criminals to exchange power for money. This is what the people call “the teaming up of government and business?or “the cops and the crooks are one family? This behavior is a big enemy of sustainable development. [P. 276]
“Poverty is the worst kind of pollution?expresses clearly the link between poverty and vicious cycles of ecological deterioration. But we should never forget the power pollution sometimes causes more pollution than anything else. There can be no clean environment without clean government. [pp. 274 - 276]
There are many different organizations and many surplus workers in the Chinese government. The forestry workers attached to the government forestry departments and the construction project workers of the hydrological departments create built-in pressures to get capital and grab projects to create employment for all these people. Just for this reason Chinese government departments tend to focus on big projects rather than on enforcement of regulations and the establishment of a sound regulatory framework. Isn’t exaggerating the role of a department in sustainable development as a means of getting funds and power another way in which government departments act as interest groups?
If the behavior of government departments is to meet China’s sustainable development needs, the achievements of government departments will need to be evaluated objectively. The organization and arrangement of power within the government must be changed as well. Great objectivity will be needed for this. Yet the government, because of the “power pollution?discussed above, has already become a semi-public, semi-private interest group. In many areas “being responsible to the people?, like “sustainable development? itself, is just an empty word. “Being responsible for the interests of my department?would be the honest thing to say. China has many good, public-spirited officials but they are very often fired for being “someone who can’t get along?even though the official’s views are in line with the public interest, the law and sustainable development. Sustainable development depends upon the behavior of the government and without adequate supervision of the government there can be no sustainable development. [p. 276]
Without an evaluation system free of power and money, sustainable development will have no meaning. Without proper evaluation departments will only report happy news and make no mention of the price paid in one area for progress in another or even falsify statistics. The statistics that some localities report on resources (forest, grassland and land) are data that is already over ten years old. Even worse is falsifying data from environmental monitoring stations. In many places the “leader is wise? So with just a few words from the leader experts will write dishonest reports. The leader will use these reports and make bad policy decisions. Sharp eyes are needed to analyze the losses and benefits of policies to people in every sphere. Most of all, the legitimate rights of people must be respected. People who dare to speak the truth are not getting the protection they deserve.
As long as power is above the law, Chinese laws on the environment, resources and population will not have much effect. The sharp rise in the pillaging of forest resources when the Forest Law was passed shows that during reform some departments will “rush to get on the last train?and increase their efforts to misappropriate public resources. Fellow Chinese, we must not let our limited natural resources be ravaged again as they were during the “Great Leap Forward?and the “Cultural Revolution? [pp. 276 - 279]
END OF PART V OF SUMMARY TRANSLATION