The Party: The Secret World of China's Communist Rulers (15 page)

The organization department hasn’t stopped disciplining errant state business executives in the meantime. In early 2009, the heads of the three state airlines were all rotated overnight into rival firms to keep competition in check. The telco heads were switched a couple more times as well.

The organization department’s responsibility for choosing the bosses of about fifty of the largest state enterprises makes it relatively easy for it to play stern parent with these companies. But the lower the level of government, and the further they are from Beijing, the harder it is for the centre to instil discipline into the ranks. The experience of Li Yuanchao prior to his elevation to head the Central Organization Department in the capital was proof of that.

About six months ahead of the 2007 party congress, the Tai lake (Taihu) in Jiangsu turned green. A crucial source of water for tens of millions of people and the heart of ancient China’s fertile ‘land of fish and rice’, the Taihu had been blanketed by an algae bloom created from the discharge of raw pollutants from chemical plants around its edge. The algae had been a recurring phenomenon for some years on the lake. This time, the pollution was so bad the lake was smothered altogether by a thick green growth. The event galvanized the leadership in Beijing, which used it to demand, as they had many times before, that local governments more strictly enforce longstanding environmental laws. The desecration of an iconic waterway also raised sharp political questions closer to home, questions about its impact on Li Yuanchao, at the time the up-and-coming Jiangsu provincial party secretary.

Li’s prospects for promotion to the Politburo at the congress scheduled for later in the year were already well known. The local media had never been allowed to report that he, along with a few other rising stars, was slated to be elevated into the Party’s ruling council. But in the strange way such news seeps out in China until it becomes common knowledge, as if it had been carried on the front page of the newspaper all along, everyone somehow seemed aware Li had been anointed for higher office, although to exactly which position and at which level was not clear. The provincial staff accompanying Li during an interview in March 2007, only months before the Taihu incident, joked about his potential promotion when their boss wasn’t present. Li himself was less relaxed, pleading at the end of the discussion for any mention of his future to be left out of any article whatsoever.

Li had another message to deliver that day, talking at length about the performance benchmarks he was enforcing as party secretary in Jiangsu to grade officials. These days, he emphasized, the environment was ranked as highly as the economy. Li compared the excessive focus on economic growth at the expense of the quality of air and water to a child who over-indulges on lollies. ‘If a child has too many sweets, he will have rotten teeth. GDP is the same. [Sweets are] a good thing but you can’t go to excess.’ A few months later, Li found himself responsible for handling the fallout from exactly the kind of untrammelled growth he had been complaining about. The response of the authorities in Jiangsu to the algae-covered Taihu, however, was much more traditional than the modern benchmarking system that Li had been advocating beforehand.

In public, Li railed against the waterway’s polluters, saying he would sacrifice ‘15 per cent’ of economic growth in the province to clean up the lake, and ordered the closure of more than 2,000 small chemical factories. It was an attention-grabbing response in a country obsessed with economic growth, but it also ignored the fact that the disaster had happened on his watch in the first place. In the county where most of the polluters were based, the grassroots authorities had other ideas about how to handle the issue. They did not include throttling the output of chemical factories which were big local taxpayers, nor pandering to critics who wanted the area’s money-spinning businesses to be closed down. Rather than sacrificing economic growth, the local authorities focused their attention elsewhere, on a local activist, Wu Lihong.

Wu had been agitating for years for the polluters around the Taihu to be brought to account. His efforts had already won praise in Beijing, with his recognition in 2005 as one of China’s leading environmentalists. Along the way, he had amassed a mountain of evidence about the condition of the Taihu, in photos and physical samples, and made countless representations about the lake’s condition to the local, provincial and central governments. His worst fears had now been borne out by the algae spread thickly across the waterway. But far from being lauded for his pioneering work, which coincided with Beijing’s urgent policy emphasis on the environment, Wu was arrested. His conviction soon after, on charges of extorting funds from local companies by threatening to expose their pollution problems, was based on a confession which he said he signed after being deprived of food and kept awake for five days and nights in succession.

After his initial headline-grabbing burst on sacrificing growth to protect the environment, Li remained silent throughout this period, acquiescing in Wu’s detention and conviction. It was soon clear why. In November, at around the time that Wu’s appeal against a three-year jail sentence was being rejected, Li was formally appointed to run the Central Organization Department in Beijing. If Li was reprimanded internally for the despoliation of the waterway and the loss of a vital source of potable water, according to his own high-profile performance benchmarks, it was never made public. The incident certainly did not impede his career. With his long-expected promotion, Li became the tenth ranked leader in the country, one position outside of the nine-member Politburo Standing Committee, a body he could now reasonably expect to ascend into at the next congress in 2012. Li showed a keen sense of what was what from the moment he arrived in the capital. One of the first senior appointments under his watch was the elevation of his provincial propaganda chief from Jiangsu into the Central Propaganda Department, as a vice-minister, giving Li a powerful ally at the heart of the state media. As a longtime supporter of Hu Jintao, Li’s broader role was to secure as many senior jobs as possible for his leader’s camp, to tighten his hold on the party apparatus.

On the surface, Li’s elevation to the Politburo after presiding over an environmental catastrophe in the Taihu made him look like a hypocritical crony. But this criticism hid a larger reality about the political system and the way that power over the economy and personnel had been devolved down to grassroots administrators. Li could have sacked and disciplined the officials with on-the-ground responsibilities for the waterway’s pollution, but he would have created a political firestorm in the process that could have entirely devoured his career. The letter of the law was no help. There was no system of injunctions that he could have served on the recalcitrant polluters of the lake, let alone enforced. Local courts exist within the local party system and are not independent of it. In some ways, Li could do little until an emergency transformed the issue into a national crisis and galvanized the entire system, from Beijing down.

The weakness of a seemingly mighty provincial party secretary like Li Yuanchao in dealing with cadres appointed several levels of government below him was vividly brought home to me by another shocking pollution case, in Hunan province, around the same time. The narrative was familiar–tonnes of poisonous metals had been discharged into the Xiang river, the source of drinking water for millions of people in one part of the province. In trying to get to the bottom of what had happened in the county where the pollutants had been dumped, the biggest obstacle was not the central and provincial authorities, which were quite open about the problem, and anxious to fix it, but their subordinates on the ground.

The landscape around the Xiang river was littered with scores of large and small factories–China’s largest zinc factory, decades-old, was nearby–separated by pools of rancid water and vegetable patches. Local villagers joked sardonically that no one would buy their vegetables once they knew where they were grown. ‘We always offer tea, but no visitors will drink it when they come here,’ one villager told me. The most recent cause of damage to the river was discharges from fifty to sixty small indium factories in early 2006, built in just a few frenzied years of ramshackle construction to take advantage of the soaring global price of the metallic element used in the manufacture of semi-conductors and liquid-crystal display screens. Most indium had previously been produced by factories operating in Guangdong in southern China, but the entrepreneurs had decamped north to find greenfield sites after a spill had polluted a large waterway there.

The most striking moment of a dismal trip, however, had come beforehand, en route to the Xiang, in the office of the provincial head of the State Environment Protection Administration, in Changsha. An accommodating, straightforward man, he had told me that he was shuttering the offending indium factories. ‘I am signing the order to close them today!’ he declared. But when his office phoned the chief environmental officer near the epicentre of the problem, at the Xiang river, at my request, to take me around the area, he was instantly rebuffed. Permission for any such visit would have to come from the local township government, the province environmental chief was firmly told, and there was nothing he could do about it.

The Hunan provincial head of the State Environment Protection Administration, a government entity, far outranked the local environment officer but that was not where the real power lay. The officer near the Xiang river looked to his own local party secretary, who was the person who would ultimately decide whether he kept his job. The local party committee had better things to do than facilitate publicity for their lax pollution controls at precisely the time that Beijing was demanding they clean up their act. The local officials in the area around the Xiang had another reason for refusing access. They had a direct interest in keeping the indium factories open because the entrepreneurs who had established the businesses had gifted them shares in the plants. The officials in charge of the Xiang and the Taihu alike were in business too.

The officials brought a lot to the table in their dealings with business. They could open and close their factories at will at a time when the businesses were highly profitable. They could impose fines, or not, on polluters. They could calibrate the level of pollution allowed as well, and how and when it could be discharged. They controlled the police, who could keep any protesters at bay, or not. They were in charge of the judges in the local courts. They might even have been able to help arrange loans through the local bank. And with such largely unaccountable powers, they could, and did, demand a share in the businesses, for themselves or their relatives or cronies, in return for allowing a factory to stay open. This combination–of wide administrative discretion amidst unprecedented economic opportunity –means that on-the-ground officials can make or break businesses, especially in localities far from larger cities, where there is less scrutiny and accountability. The potential for corruption is obvious, but in China it takes a twist.

Many officials have been arrested for taking bribes in return for approving business deals. Of equal concern for the Party, and the organization department, is what is known in the US as ‘pay-for-play’, the thriving trade in official jobs themselves. The positions with the most monetary value are those of party secretary and the head of the organization department, because they ultimately decide who gets which government post. The trade in jobs makes a mockery of the organization department’s mission to find and promote virtuous and competent officials. It means that the department, which shadows the government, has become shadowed itself by an elaborate, underground black market in the very jobs it is meant to control. There are many documented instances of ‘buying and selling official posts’, as the phenomenon is called in China, none as blatant and far-reaching as the Ma De case, in Heilongjiang province.

Conventional bribery cases usually involve public officials seeking cash in return for favours. The way Ma De and his wife tell the story, he began taking bribes for the opposite reason, because so many people had pressed them on him, without him ever suggesting they needed anything in return. When Ma first took over as one of the vice-mayors of Mudanjiang city, in the far north-east of the country, near the Russian border, his wife said that he sometimes dared not turn on the lights when he returned home, tired out, at the end of the working day. ‘Once the lights were on,’ she said, ‘those gift-bearers would queue up outside.’

At the beginning of his stint in the city in 1988, Ma and his wife would not open the door to visitors bearing gifts. Later, they were chastised about their behaviour by a colleague. ‘So you don’t eat earthly things or what?’ Ma’s wife said they were asked. ‘If you do not accept the things which are brought to your doorstep, those people will think that you do not trust them. Are you pushing them into the arms of the other people? See how other people eat, drink and take massages. If you are going to become a lone commander, how can you do your work? If you do not accept the gifts, Ma De’s regime will not be stable.’

The belief that you cannot be successful without being corrupt is commonplace enough to have been the theme of a best-selling novel in 2007, called
Director of the Beijing Representative Office.
The book, part of a series about the Beijing-based lobbyist for an unnamed city government in north-eastern China, pits a clean official against a corrupt one at a time when they are competing for the vice-mayor’s job in a run-off in the local people’s congress. The work’s author gave the tome an extra level of credibility. It was written by Wang Xiaofang, who served as the political secretary to the vice-mayor of Shenyang, an industrial centre also in the north-east, at a time when the city government was infiltrated by the mafia in the late 1990s.