For all the reforms of the past three decades, the Party has made sure it keeps a lock-hold on the state and three pillars of its survival strategy: control of personnel, propaganda and the People’s Liberation Army.
Aside from a few largely symbolic exceptions, every senior government minister or official is a party member. By contrast, every senior party official does not always hold down a government post. Many instead work for the key party departments, which outrank mere government ministries.
Ordinary citizens can sue the government in China these days, and many do, although they may stand little chance of success. But they cannot sue the Party, because there’s nothing to sue. It is dangerous and pointless to try to sue the Party. As an organization, the Party sits outside, and above the law. It should have a legal identity, in other words, a person to sue, but it is not even registered as an organization. The Party exists outside the legal system altogether. The Party demands that social organizations all register with government bodies, and punishes those which don’t.
In pronouncements on the legal system the Party regularly reiterates the law’s place in the political pecking order. Judges must remain loyal in order - to the Party, the state, the masses and, finally, the law, according to the report issued to the National People’s Congress in 2009 by the Supreme People’s Court.
No legal obstacle is so great that the Party cannot brush it aside. For the security services, the single line in the constitution about the Party’s leadership role of the country has always been sufficient legal basis to arrest any critic. Hu Jia, one of China’s bravest dissidents, used to ask the plain-clothes police who waited on his doorstep to stop him leaving his apartment under what Chinese law he was detained. Hu Jia’s questions enraged the police. Some were so angry they beat him up. One day, he said, one of them finally responded to his question, blurting out the grounds for detention. “Under the preamble to the Chinese constitution!” the policeman yelled, before dragging Hu away.
In place of Mao’s totalitarian terror, the Party has substituted a kind of take-it-or-leave-it compact with society. If you play by the Party’s rules, which means eschewing competitive politics, then you and your family can get on with your lives and maybe get rich. But the deal does not exist in isolation. It is buttressed by a pervasive propaganda system which constantly derides alternatives to the Party. The underlying message is that the Party alone stands between the country and the kind of murderous, impoverishing instability times in its history. Recalibrated along these lines, the compact also reads - get rich, or else!
As society has changed in the last decade, so has the Party’s membership make-up. Top leaders have systematically set about jettisoning the body’s proletarian rural roots in favour of an alliance with the richer and more successful classes emerging out of the market economy. Once dominated by workers, and then by peasants - who alone made up nearly half the membership until as late as 1978 - the Party now seeks out star students and wealthy entrepreneurs. They are the fastest growing sources of new members, expanding their numbers in the Party by 255 percent and 113 percent respectively between 2002 and 2007. Many of them have been happy to embrace the Party, because it offers them in return access to a network that is crucial to furthering their careers.
To buttress its legitimacy, the Party has also cloaked itself in Chinese governing traditions. The revival of Confucius in the last decade, the ancient sage reviled under Mao as a symbol of backward feudalism, and the methodical refurbishing of other cultural canons, is symbolic of a broader trend, of the Party re-packaging its rule as a natural continuum of the most enlightened eras of China’s imperial history. With no ideology left to speak of, selective historical antecedents provide single-party rule with an indigenous imperial lustre.
The idea that the CPP, far from landing in China in a Leninist spaceship, could draw on the country’s deep traditions of authoritarian central bureaucracy, might be obvious to outsiders. Countries do not shed their histories so easily, despite efforts by zealots like Mao to wipe them out and start with a blank slate.
We are the Communist Party and we will decide what communism means.
In China, it is very important to display the political power of the Communist Party. Management can solve a majority of problems, but not all of them.
The party apparatus in Beijing, in tandem with the Central Organization Department, shunted aside local bigwigs by placing the power to hire and fire senior executives in banks and other state enterprises with the centre, no matter where they were in the country. Any regional bank offices which refused to sign up to the Politburo’s programme were threatened with closure. Put crudely, Zhu’s strategy echoed the saying popularized in the Vietnam war to explain the US military’s programme to pacify Vietcong villages. The Party decided it first had to get bank executives by the balls to enforce Beijing’s writ. Their hearts and minds could come later, if ever at all.
The front stage of the government’s regulatory system remained intact on the surface. The local banks and regional regulatory authorities were outwardly undisturbed. Backstage, however, the Politburo had created an entire parallel policy universe, ‘a powerful yet mostly invisible party body for monitoring financial executives.’ Zhu and the Politburo did not bother to give these all-powerful party bodies any legal status, by putting bills through the legislature. Nor did they give them the stamp of government authority by publicly announcing their formation through the cabinet. The fact that these two committees had no lawful basis did not matter. The backing of the Politburo and the direct threat to the jobs of provincial bank executives were more than enough to galvanize local officials to sign up to Beijing’s plan to secure the Party’s economic base.
Each region of the Grand Area was assigned its “function” within the global system. The ensuing “Cold War” consisted largely of efforts by the two superpowers to enforce order in their own domains: for the Soviet Union, Eastern Europe; for the US, most of the world.
By 1949 the Grand Area that the US planned to control was already seriously eroding with the “loss of China,” as it is routinely called. The phrase is interesting: one can only “lose” what one possesses, and it is taken for granted that the US owns most of the world by right. Shortly after, Southeast Asia began to slip free from Washington’s control, leading to horrendous wars in Indochina and huge massacres in Indonesia in 1965 as US dominance was restored. Meanwhile, subversion and massive violence continued elsewhere in an effort to maintain what is called “stability.”
In fact, very few officials from these areas have advanced into the top echelons in Beijing. The performance benchmarks are kept in reserve, to be enforced when they are needed, a Chinese academic explained. “Above a certain rank, these tables do not mean much,” he said. “It is in the interest of senior officials to keep it that way, because they can enhance their own individual power and standing. Otherwise, they are hostage to the system.” The regulations are much like laws in China, he said, for reference purposes only.
The Party’s most effective tool in elevating competence over cronyism during the last decade has been a practical and resolutely old-fashioned one. The department stress-tests promising officials by rotating them through jobs in diverse parts of the country and in different administrative units, before hauling them back to Beijing into the big league.
Carlos Gutierrez, the then US Commerce Minister and his counterpart in the Bush administration, met Chen in late 2007 for the first time and remarked how impressed he was by his grasp of his portfolio after a short period in the job. Chen’s career path, Gutierrez remarked, reminded him of the rigours successful multinationals put their up-and-coming executives through, sending them first into the field, to difficult regional offices and underperforming divisions, before bringing them back into head office to see how they performed there.
“The idea that the boards really run companies is basically as credible as the constitutional guarantee of free speech and religious freedom in China. It does not happen in reality,” the banker said. “At all the major state companies, the party meetings are held regularly before the board meetings. Operating costs, capital commitments and the like are discussed at the board meetings, but personnel remains in the hands of the Party. No matter how many independent directors there are and what oversight they provide, at the end of the day, if all management are appointed by the Party, nothing will change.”
In Wang’s novel, the first official, Li Weimin, is an upright and principled cadre who cares deeply about the community he is serving. Parachuted into the municipal government, he bristles with integrity and makes sure his family members do not exploit his position for personal gain. Far from endearing himself to his colleagues, Li’s austere lifestyle infuriates them. Drivers and secretaries do not like working for him, because they toil for long hours with no extra benefits thrown in. His colleagues feel embarrassed by his decision to stay living in an old residential building instead of moving to the gleaming new official compound where they are housed, rightly sensing that he has made them look bad in front of ordinary people. And he spurns sumptuous government banquets, opting instead for a simple meal at his desk, forcing his colleagues to follow suit. His behaviour, the narrator says, makes him seem “an unreasonable man who has no sympathies for his colleagues.”
With the paramount emphasis on politics, the hierarchies are upended in China. From its very beginnings, the PLA has had a dual leadership system in its officer ranks. Much like a person with two heads, one watching the other, each senior position is filled by two officers of equal rank, one a commander and the other a political commissar. Discerning the division of responsibilities between them, and who defers to whom and when, is not easy. “They can’t get their heads around our NCO system, in which a commander can defer to a subordinate,” said a foreign military officer. “And we can’t get our heads around their system, with these two equally ranked commanders.” (The PLA now has an NCO corps, but its soldiers have none of the authority or esprit de corps of the western variety.)
Instead of moving up to become the chief military leaders, the majority of the princeling generals ended their career in deputy positions. The fact that they hit a glass ceiling in the military and the Central Committee means that their family background could be a liability.
Anyone invited to China, no matter how lowly, is required to acquiesce in the one-China policy, which recognizes Beijing’s sovereignty over Taiwan. To do otherwise instantly renders an individual persona non grata. The policy has always been policed with a breathtaking exactitude, in which no transgression of the basic rule - that Taiwan is an inalienable part of China - is allowed to pass.
At home, the Chinese media also has to navigate linguistic traps to stay within the rules. A Shanghai newspaper reporting on the construction of a new semi-conductor plant in the city in 2002 hailed it as “the largest in China”. It was only the following morning that someone pointed out the grievous error in this formulation. The world’s biggest semi-conductor plants were in Taiwan, which was, of course, part of China as well. The editor was forced to make an old-style self-criticism and take a temporary pay-cut to atone for his mistake.
On Taiwan, however, Jiang handed his successor a veritable time-bomb. China has commissioned dozens of new submarines, built domestic naval destroyers, deployed anti-ship missiles which can be launched from submarines, and readied thousands of missiles along the coast a few hundred kilometres across from Taiwan, with the single aim of retaking the island. Hu was left to pick his way through a dangerous domestic political minefield, to find a way to take Taiwan off the agenda and restore absolute primacy to the economy, without alienating the PLA at the same time.
Chinese diplomats often ruefully joked how they received calcium tablets in the mail, sent by angry citizens who wanted their representatives to stiffen their backbones in dealing with foreigners.
Yan was still apologizing for his wrong forecasts of war when I saw him in mid-2009, but not for the reasoning on which they were based. His big mistake, he said, had been to misjudge the Chinese people. He had thought that they would rise up at the prospect of reunification with Taiwan being pushed off the agenda. But in the end, people didn’t care. “Chinese people are not that nationalistic,” he said. “They are very money oriented. The dominating ideology is money worship. As long as the situation in Taiwan is favourable to making money, we don’t care if the island becomes independent.”
For the same reason, he argued, the urban middle classes in China and the students at his university had no interest in politics and democracy, because fighting for these ideals could only disturb their increasingly comfortable lives.
“The party leaders realize that they don’t have a dominant ideology they can use to run the country anymore. For them, there is no core social value. At this moment, the sole, dominant ideology shared by the government and the people is money worship.” For yan, wealth did not automatically translate into strength. “Our military budget is already 1.6 times that of the Russians but we cannot build the same military. Our education spending is much larger than India’s, but we cannot have one single person win a Nobel Prize. They already have ten. We have more rich people than Japan and we have more first-ranked companies, but we can’t build world class products. We have more foreign reserves than anyone in the world but we cannot build a financial centre even like HK.” The list went on and on.
The threat of an investigation by the commission is enough to send shivers down the spines of any party official, although not in the way many might think. Senior party members in China are much like members in the US military when it comes to criminal investigations. They cannot be arrested by civilian law enforcement bodies or other outside agencies for criminal offences until the allegations have been investigated by the Party first. The commission alone, as the Party’s in-house anti-graft body, has the right to investigate officials and detain them when it decides they have a case to answer. “The country has the country’s rules,” said one official, in explaining the system’s logic. “But in your house, you must follow the house rules, and they are the most important.”
The “house rules” are very simple. For any official it wants to probe, the commission must first get clearance by the party body one level up in the governing hierarchy. In other words, the more senior an official is, the more difficult it is for the commission to gain approval to investigate them. The stream of corruption cases in China and the ruthless justice meted out to those who fall foul of the system sometimes gives the impression of a Party committed to exterminating graft without fear or favour. Far from the modern-day Chinese version of Eliot Ness’s “Untouchables”, however, the commission is structured to keep its investigators in check. The approval process, with its bias towards protecting top leaders from any scrutiny at all, means the commission is dogged by politics, and political struggle, at every turn.
The commission’s powers of detention are the most fearsome weapon in its armoury. There are no legal nicety when the commission comes calling. Under a procedure known as shuanggui, or ‘double regulation’, so called because suspects are held at a time and place regulated by the Party, the commission, in effect, kidnaps officials, and holds them for interrogation until a decision is made until a decision is made on whether to proceed with a formal case against them. Officials under investigation have no rights to call their families or hire a lawyer, and can be detained without trial for up to six months, without the law ever entering the equation.
With neither judge nor jury to speak of, the commission’s verdicts are delivered in public through an unusual mechanism, the announcement of the suspect’s expulsion from the Party. Only then are their cases formally referred to the prosecutors. Being expelled from the Party for serious corruption is tantamount to a finding of guilt in a court of law, even though the trial itself and a formal verdict and sentencing may be months or longer away. Once officials have been passed over to the legal system, their fate has already been decided. During shuanggui, the person is still struggling to obtain their personal freedom or be let off with a demotion in rank. By the time they reach the court, the argument is solely about the length of their sentence, not their guilt or innocence.
The biggest beneficiaries of the requirement for the commission to get political clearance from above to proceed with investigations are the country’s most senior leaders. Short of civil war, there is no mechanism by which the commission can get approval to investigate any of the nine members of the Politburo’s inner circle, unless they effectively hand themselves in. As the son of a former senior leader told me: “It is sort of a given that they are beyond the law.” By extension, their seniority protects their immediate family members as well, and reinforces strict taboos prohibiting public discussion of the private and business lives of top leaders and their kins.
Corruption investigation are always used as leverage. They are an essential part of power struggles.
A few weeks later, the Shanghai authorities took further retaliatory by arresting Zheng for leaking state secrets, a charge often wheeled out when the authorities want to make a political example of critics, and sentenced him to three years in jail.
Later, it would emerge that Zhou had bribed his jailors while inside. He was able to shirk the usually mandatory prison labour, receive visits from friends whenever he wanted, use a phone and watch television in his supervisor’s air-conditioned office.
Like most protests in the square, the most heavily policed piece of real estate in China, it was over quickly. “We lasted about one minute,” Xu said. Beijing was swarming with plain-clothes Shanghai police for lengthy periods during this time. Every petitioner initiative or protest was eventually squashed. But the protesters’ actions were more effective than they might have realized. Each incident was an embarrassment for Shanghai and ammunition for the city’s emboldened enemies in the capital.
The surest way to follow Chen’s demise during this period was to watch the fall of officials who once clustered loyally around him. It was a case study in how the commission operated.
The announcement of Jiang’s book was as public a signal as possible in China that Hu and Jiang had reached an accommodation over the Shanghai case. With Jiang on board, the Politburo Standing Committee formally approved a corruption investigation into Chen. The agreement included a side-deal, that neither Jiang nor his family, long the subject of gossip about favourable treatment in business deals, would be touched.
When a wall starts collapsing, 10,000 people rush to push it down, according to an old Chinese saying. Once Chen was in custody, stories of the disgraced party secretary’s serial philandering flooded the official media. On the internet, a number of former alleged mistresses were outed, and goaded into denying their relationships with Chen. When excoriating fallen officials, the propaganda department is always happy to publicize their sexual indiscretions.
The Party deliberately chose Changchun for the trial, because it was about as far away as it was possible to get from Shanghai. The authorities knew that the judges in Shanghai owed their jobs to Chen and his supporters and could not be trusted to follow Beijing’s line in cases before them. Chen made only a short statement from the dock after his sentencing to 18 years in jail. “I have let down the Party,” he said from the dock. “I have let down the people of Shanghai and let down my family.” Chen’s appearance bore the telltale look of all senior officials who emerge from lengthy periods of detention under shuanggui for their formal trial. Unable to dye his hair in custody, Chen’s formerly jet-black locks had gone grey.
Can we allow the era of opening and reform to remove us from power and replace us with the capitalist classes? That absolutely won’t work. We can’t push the anti-corruption campaign indefinitely. For who else can the regime depend on for support but the great masses of middle-level cadres? If they are not given some advantages, why should they dedicate themselves to the regime? They give their unwavering support to the regime because they get benefits from the system. Corruption makes our political system more stable.
For years beforehand, China’s senior leaders had meticulously managed the preparations for the games, timed to open at an auspicious moment on the Chinese calendar, at 8pm on the 8th day of August 2008. Whole neighbourhoods in Beijing had been cleared to make way for the sport extravaganza. Giant steel factories were moved out of the city and a million cars ordered off the roads just ahead of time to cut pollution. Offshore, the government had tweaked diplomatic policy just enough to throw critics of China’s human rights record temporarily off course. In the final, nervous days ahead of the games, senior leaders had personally intervened to replace the young girl chosen to sing the national anthem at the opening ceremony with someone they deemed more suitable. Nothing was to get in the way of the moment designed to embody China’s rightful return to the ranks of great powers.
What is obvious for anyone who travels around the country, however, is how much the economy is driven by another factor altogether, a kind of Darwinian internal competition, that pits localities against each other.
Cheung’s joke about good-looking girls was a reference to the county in Anhui province which held a beauty contest in 2005 to select the most beautiful local women to head teams to travel the country seeking investment for the area. Criticized all over the country for his gimmick, the area’s party secretary replied: “Beauty is an asset. Why not use it?” A locality with 300,00 residents, according to Cheung, often employs as many as 500 people whose sole job is to solicit investment.
Then, the company added some cyber-insurance for itself, with the strengthening of a so-called “protection agreement” it had previously purchased from the search engine Baidu. Baidu had long finessed its internet searches for the Chinese government, to block commentary critical of the Communist Party. It sold the same service to commercial clients, in the case of Sanlu for RMB 300M, to limit or screen out searches linking the company’s product to sick babies and melamine. (Baidu later denied selling this agreement.)
The city’s Justice Bureau sat under the Justice Ministry, which in turn reported ultimately to the Politics and Law Committee.
Li had no direct contact with the Politics and Law Committee. Such party bodies prefer to exercise their control at one remove, through government organs or state-controlled professional associations.
Anyone who has sat through speeches by top leaders in the Great Hall of the People will recognize this technique, of the rising pitch used to signal to the audience it is time to applaud.
As late as 2008, the top of the list remained a dangerous place. The richest man in China, Huang Guangyu, head of a national appliances chain-store network, Gome, with an estimated fortune of $6.3B, was detained for alleged insider trading in November 2008. The first reaction to the arrest of people like Huang was not, “what did he do wrong?”, but “who did he offend?” The high-profile arrests of rich businessmen and women, however, overshadowed a more important development. Entrepreneurs had been starved of bank capital, fenced out some of the most profitable sectors of the economy, often forced into unholy alliances with state partners and sometimes sent to jail. Despite these setbacks, private wealth had gradually become an indispensable part of the Chinese landscape.
In late 2008, Wang summed up the rules he had learnt for doing business as an entrepreneur in China. From the moment he established his private business, he said, he had been careful to take on a government shareholder, to give his company a “red hat”. “You take too much, the state is unhappy, and you take too little, you get upset with yourself,” he said. When this first state shareholder was replaced a few years later, he made sure his new partner was state-owned as well. The first rule, he said, was that you will not develop quickly without a “red hat”, or a state partner. And second, you had better be careful about making it big without one. He had no need to articulate the third rule, which he had learnt in the wake of 1989: to stay out of politics altogether.
Zhang understood in his bones the biggest threat posed by entrepreneurs: the creation of well-funded, self-contained private networks in society and business which no longer reported to the Party, or through it. Out of sight, they could become incubators for rival centres of power. The Party had long fretted about such a phenomenon, of “peaceful evolution”, the process through which the Party’s grip could be slowly eroded by groups not under its sway. In the words of the head of a US direct sales company in Beijing: “The Party doesn’t want any large organized group outside its ambit which can operate at scale, whether it is religious, political or just a large group. They simply do not want the competition.”
Setting up a party committee seems to be a symbol of normalization. Only if they have a party organizations will central government leaders visit them when they come to Wenzhou. If you ask what the function of the committees is, that is the biggest one.
Liu had long before internalized the inbuilt bias against the private sector. In the twenty years to 2002, before the split with his brothers, his businesses had never relied on borrowing from the state banks. The banks hadn’t initially been interested in lending to the Liu brothers. And when the banks did start to chase their business, the Lius did not need them. Like most entrepreneurs, they had learnt to fund themselves from their profits. Once he accepted this was the way of the world in China, Liu said his attitude changed for the better. “Otherwise, you will be full of spite, and then either do nothing or do something extreme, which could be illegal.”
Liu’s hard-won self-reliance influenced more than just they way he did business. His determination to have a very disciplined relationship with officials and not do shady deals to get ahead also dictated the sectors he invested in. He gave up on real estate, he says, because he could not bear socializing with officials. “Real estate requires lots of insider trading, and constant wining and dining and gift-giving,” he said. Likewise, he decided not to list his new company on the stock exchange because this “would take a huge amount of personal energy on lobbying [the regulators] and various other government departments… and walking too close to the path of illegality.”
The local officials in the provinces had every incentive, and right, to seek out entrepreneurs like Liu. “We could satisfy their needs with our performance, taxation, environmental protection, and social image,” said Liu. “Pardon me for being frank, but local officials, even corrupt ones, all need to have political achievements.”
By the end of the course, the entrepreneurs had gained a new respect for the officials and the mammoth jobs. Individually, the officials were often responsible for the welfare and provision of services to tens of millions of people. They worked investment banker hours, were forced to spend long periods away from their families and had to endure three to four banquets a night, with endless toasts. They were competitive too, performing for and against each other, and for the powerful captive audience at the school. “The competition among them was much more fierce than among us - we were amateurs,” the entrepreneur said. “Once we were inside, be became great defenders of the system. It is kind of like the orphan principle. Once you are a part of a family, you stand up for it.”
In China, the head of the Central Propaganda Department is like the Secretary of Defense in the US and the Minister of Agriculture in the former Soviet Union. The manner by which we brings leadership will affect whether the nation can maintain stability.
The days when the Party automatically jails or even kills its critics are long gone. There are many more subtle, sophisticated ways for a media-savvy propaganda department to deal with problems. Troublemakers, as the Party likes to call its most dogged critics, as if they are naughty school-children, can be removed from the jobs, silenced with quiet threats to their families, excluded from the media and shamed by being labelled unpatriotic. As a last resort, they can still be put in prison or forced into exile.
China under Mao Zedong had much in common with other totalitarian systems. To borrow the oft-used phrase, terror was not just a side-effect of the system. Terror was the system for extended periods of Mao’s rule. In the last three decades, the Communist Party has turned that formula around. Terror is just a side-effect these days, used relatively sparingly and, in large part, reluctantly. In modern China, the system runs on seduction rather than suppression. It aims to co-opt, not coerce, the population. But even so, terror remains essential to the system’s survival and is deployed without embarrassment when required. An official once told me: “People need to fear the government in China, otherwise the country will fall apart.”
Then there is corruption. Certainly, China is deeply corrupt, but corrupt regimes can last a long time. The Chinese officials who do get arrested for graft generally fall into two categories, or something both. They are the losers in political power struggles, or their corruption has become so outrageous that it embarrasses the system, and thereby jeopardizes the game for everyone else. Corruption in China seems to operate more like a transaction tax that distributes ill-gotten gains among the ruling class. In that respect, it becomes the glue that keeps the system together.
For all the hullabaloo surrounding the perennial anti-graft campaigns, the risk of going to jail remains small even for officials caught with their hands in the till. Since 1982, about 80 percent of the 130,000 to 190,000 officials disciplined annually for malfeasance by the Party received only a warning. Only 6 percent were criminally prosecuted, and of them, only 3 percent went to jail.
For all its rising global interests, the scale of China’s domestic problems, in their depth, multiplicity and variety, means that central government leaders will remain preoccupied at home. It is often hard to explain to outsiders that Hu Jintao does not wake up in the morning worried about what is happening in the US Senate, but by peasant riots in Henan, the choice of the new party secretary in Shandong, a corruption case in Shanghai, coal-mine disasters in Shanxi and so on. China has an ever-increasing outward focus but local problems have priority when they land on Hu’s desk in the morning.