Understanding China, One Blog at a Time

An American in China

What Corruption Looks Like in China

Posted by w_thames_the_d on June 13, 2012

The following is an excerpt from China’s Surge in Corruption by M Johnson et. al. here . It describes how corruption occurs in China and has occured in the past. The author sheds light on the fact that under Mao’ist communism, there was no private property, thus one did not directly steal from someone else. The authors claim that to a certain extent this lack of distinction between what is mine and what is the states’ is at play. In addition, the authors state that stalled reforms have enabled rampant theft.
“Official profiteering thus became a growing problem, as many administrators engaged in moonlighting and stock dealing, as well as in giving and accepting bribes. In Liaoning Province, for instance, the Liaoxing Shiyie Company was set up by 12 provincial officials who purchased and resold steel, chemicals, and petroleum. In Nanjing, the same 1,000 tons of steel were purchased and resold 223
times among 83 companies and danwei over a period of several months, with the price increasing from 1,663 to 4,650 yuan per ton….

In the end, many analysts accept for the whole of China Jean Oi’s contention that much of the corruption that has occurred in rural China since the launching of reforms has resulted not from the introduction of market systems per se, but from the incompleteness of the reforms, resulting in a system that is doubly plagued by problems attributable both to the plan and to the market. These problems reflect a system that has failed to remove all the sources of corruption inherent in the socialist planned economy while opening new opportunities for malfeasance with the addition of a partial market….

Conceptions of corruption have been affected in the past by official campaigns, but in the late 1970s official corruption generally still meant three things: tanwu, shouhui, and tequan. Tanwu (malpractice) was the misappropriation of public property by state officials through embezzlement, theft, or
swindling. Shouhui referred to the use of official positions to take in bribes. Tequan (privileges) encompassed a range of privilege-seeking activities by officials.

By the early 1990s, however, “corruption” had broadened to include fubai (a generic term, meaning
“decay and putrefaction,” that is used as a metaphor for corruption) and guandao (official speculation or profiteering). Traditional guanxi has been joined by new forms. Other patterns surviving from Mao’s era have changed: local cadres who once used bureaucratic evasions to protect (or feed) their neighbors now do so to enrich themselves, while clientelism has shifted somewhat from lower-level to higher-level cadres.

Moreover, the forms of conduct labeled “corrupt” have multiplied. A collation of corruption reports in the Chinese press between June and November 1993, for example, included not only instances of embezzlement and bribery, but also offenses against financial and economic discipline, swindling, and indiscriminate collection of fees from peasants; blackmail, smuggling, and black-market currency exchanges; establishing illegal businesses, resale profiteering, and substitution of defective or counterfeit goods; illegal price increases, indiscriminate issuance of bonuses, and malpractice in assigning jobs”

read here http://conferences.wcfia.harvard.edu/sites/projects.iq.harvard.edu/files/gov2126/files/johnston_hao__china_surge_corruption.pdf

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