China's corruption culture
In the second session of the Chinese Communist Party’s 18th National Congress this month, outgoing President Hu Jintao gave his last speech to the delegates, warning of possible threats to the Communist Party. He highlighted political corruption as one of the major challenges for the party. “Opposing corruption and building an honest and clean government is a clear stance the party has been adhering to and is an important political issue the people have been paying attention to. If we fail to handle this issue [corruption] well, it could prove fatal to the party and even cause the collapse of the party and the fall of the state,” he said.
On the face of it, these comments could not have been more timely. The Party Congress has been overshadowed by a murder and corruption scandal involving the party’s once-rising star, Bo Xilai. Bo was expelled from the party which will allow for his trial. He has been accused of using his position to seek profits for others, and of taking bribes either personally or through family members. But Bo Xilai is not alone. Families of two of China’s other top leaders have also been revealed to have garnered enormous wealth. Close relatives of the outgoing Chinese premier Wen Jiabao have amassed some $2.7 billion during his tenure, according to the New York Times. And Bloomberg reported that the incoming president Xi Jinping’s family is worth $376 million.
But beyond these handful of prominent cases, just as prevalent is the constant, low-level corruption that plagues the lives of ordinary Chinese. Corruption is perhaps the worst kept secret in contemporary China. As China’s economy has grown on a breathtaking pace, so has official corruption. Writing in the New Yorker, Evan Osnos revealed how a deadly high-speed rail accident last year showed the extent of this culture of graft and corruption among public officials in China. The scale of the graft is huge, with officials using their political power to illegally benefit from the system.
A report by the People’s Bank of China that was never intended to be released to the public but accidentally released last year, highlights the extent of Chinese corruption. The report quoted statistics based on research by the Chinese Academy of Social Sciences: 16-18,000 Communist Party and government officials, public-security members, judicial cadres, agents of state institutions and senior-management individuals of state-owned enterprises have fled China since mid-1990s. And they have taken about $126 billion along with them.
The scourge of corruption has rattled the Chinese leadership for some time. It was a major theme at the last party congress chaired by Hu Jintao five years ago. Just before the 17th Communist Party Congress in 2007, the party set up the National Bureau of Corruption Prevention under the Chinese cabinet. As per its first chairman Ma Wen, “the founding of the bureau [was] to meet the need to effectively prevent corruption in China.” But the problem has only grown since. Going by reports in Chinese state media, party’s disciplinary system has handled more than half a million corruption cases since 2007.
Moreover, these anti-corruption efforts focus largely on local or lower-ranking officials and rarely reach all the way to the top echelons of the party’s leadership. Even then, the risk of going to jail remains low for those caught with their hands in the cookie jar. Since 1982, 80 percent of the officials disciplined by the party for malfeasance have been left with a warning. As per Minxin Pei, only 6 percent were criminally prosecuted and of these, only 3 per cent were sent behind bars.
Clearly, notwithstanding the strong words on corruption, the current Chinese system is incapable of preventing graft. But will it “prove fatal to the party”, as Hu Jintao recently warned?
Richard McGregor, in his book, The Party: The Secret World of China’s Communist Rulers provides the answer. “China may be 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 sometimes both. They are the losers in political power struggles, or their corruption has been so outrageous that it embarrasses the system, and thereby jeopardises 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.”
Wouldn’t it be suicidal for the Party to remove the glue that keeps the system together?
Sushant K Singh is Fellow for National Security at the Takshashila Institution and editor of Pragati-The Indian National Interest Review