To No End: Why China’s Corruption Crackdown Won’t Be Stopping Soon

[LeveragedBuyout]

http://ftalphaville.ft.com/2014/09/11/1967222/chinas-anti-corruption-trillions/

China’s anti-corruption trillions
David Keohane Comment | Share

Some thoughts from Nomura a little while back on where exactly all of this anti-corruption cash being swept up in China on the orders of Xi Jinping might end up.

Potentially, in the coffers of local and central government:

Our anecdotal checks reveal that for cases involving cooperation among various local and central governments, distribution of any recovered funds has largely been based on negotiation among the governments involved.

… a billion here, a billion there

In the Report on the Work of the Supreme People’s Procuratorate (8 May 2014), the government disclosed that there were 2,581 corruption cases valued at CNY1mn or above in 2013, resulting in recovery of CNY10.14bn in illegal proceeds. Reuters reported on 30 Mar 2014 that Chinese authorities had seized assets valued at at least CNY90bn related to the Zhou Yongkang case. Oriental Daily reported on 1 Jul 2014 that Xu Caihou had turned in CNY1bn-plus of illegal proceeds and may have another HKD10bn tucked away in Hong Kong. We note that reported corruption cases have occurred in some well-oiled sectors, including the military, coal, energy and utilities. With Beijing expanding investigations into local governments’ past land sales and the financial space, on top of the SOEs, total seized assets will likely rise. Hypothetically, if 3% of China’s GDP since 1995 went to corruption, this would total CNY4tn, assuming the amount was compounded at the modest PBOC 1-year benchmark savings rate and a 25% recovery rate. We note the actual amount could be even higher considering the decade-long bull market in various assets.

So, perhaps the LGFV risk is not so unmanageable after all?

While the distribution of seized illegal gains among central and local governments would be subject to technicalities, we are talking about a lot of money that could help to fix quite a few problems. China’s fiscal income was CNY12.9tn and fiscal deficit was CNY1.1tn in 2013. As of end-June 2013, the balances of China’s local government funding vehicle (LGFV) and local government debt were estimated at CNY7tn and CNY10.9tn, according to the National Audit Office. While family members have been allowed to retain illegal proceeds in cases where the official(s) involved are deceased or out of jurisdication, we expect tougher efforts by Beijing to seize all illegal gains under the new Code of Criminal Procedure effective in 2013, the Ministry of Public Security’s “Fox Hunting 2014” project and the APEC anti-corruption network established in August 2014.

We have no idea if this will come to pass — or, if it does, how big a risk there is that local governments will respond to this incentive in dangerous ways.

But it does paint a very direct picture of the reform battle (maybe) being waged at the top levels in China. As Michael Pettis has said many times before, “what will largely determine the path China follows is the political struggle the Xi administration will have in imposing the needed reforms on an elite that will strongly resist these reforms – mainly of course because these reforms must necessarily come at their expense.”

The above (and yes the obvious caveats about the drivers behind this anti-corruption drive apply — there remains no guarantee this isn’t an exercise in control, in the absence of real reform) would be a pleasingly streamlined example. Just need to find one for those who gained via the system rather than through corruption directly next.

 

[cnleio]

I think we can see where Xi is trying to lead both the party and the nation.

China in the era of Mao was a typical collectivist economy. Whole economy was virtually controlled by state and it was a very typical autarky that only made limited trade with it's allies (the eastern block). The problem experienced with that model was stagnant economic growth, due to lack of competition among stakeholders, inefficiency of an economy run from a single center, unable to challenge the wrong policies due to lack of democracy and free speech. The list can get longer and longer with more arguments yet still I guess I made my point about an autarky. By the way no autarky survived in the history of humanity.

However Mao was an important leader in Chinese history, because he was the first leader who could create a true nation from Chinese people with a mutual identity and a common "standardized" culture. In order to become a true nation people should have some common points and feel some form of "attachment" to all people living among the nation. Therefore despite Mao's great failure in the "great leap forward", he is a very important figure in Chinese history.

Deng Xiaoping was the leader who reformed the economy that was destined to stagnate with Mao's policies. He simply destroyed the Chinese collectivist economy in favor of state and individual capitalism (reforms) and destroyed the autarky to make trade with the whole world (opening up).

What we've seen in Chinese economy after Deng Xiaoping reforms was a Mixed Economy, relies on FDI, very limited domestic consumption with phenomenal saving rates. Main growth engines are : FDI, Exports, Infrastructure projects, SOE's. This model let China what it is today. It has a GDP per capita close to 7000$, it's the world's second largest economy, the country that broke the record for lifting the most of it's population from poverty in a single generation.

But is it maintainable? Definitely not, that's the point where Xi comes into play.

This anti-corruption campaign has two faces. The first face is really anti-corruption which is a Western argument against Chinese economy that has solid background (I know a great deal of arguments coming from western hemisphere to developing countries are baseless and biased and fuels a lot of stereotypes but this is not one of those). In order to protect the worldwide prestige of the Chinese economy this effort is a must.

Second face is crippling the inner-party resistence to Xi's reforms for getting to the 3rd phase of reforms. Remember Deng Xiaopeng's reforms started a chain of reaction and huge public resistence and that led to events at Tiananmen. Xi's reforms are also seeing resistence.

@LeveragedBuyout - In Xi's reforms you can see that he is promoting personal capitalism [1] [2]. Reform for leaving out the Mixed Economy and becoming a true Capitalist Economy is what Xi trying to do right now. Is it a solid policy improvement for corruption? Of course yes. Chinese SOE's are making trillions of dollars in revenues in a year. Of course the SOE's are "professionally" managed and they are being traded in various stock markets which makes the companies prestigious. However I think this trillions of dollars in revenue (billions in profit) makes the actual monetary motivation for corruption. Passing to personal capitalism will sure bring out some other forms of corruptions but those problems will be the problems of the next leadership.

- Mao brought China to early 19th century West (Nationalization)
- Deng Xiaoping brought China to early 20th century West (Mixed Economy)
- Xi is trying to bring China to post 1950's West (Personal Capitalism, Neoliberalism)

After Xi's reforms China will probably be transformed into a true bourgeois dictatorship just like US is right now. If China even can go the extra mile after 3-4 decades and strike a true balance between the power of elite and power of people it could end up being like Northern Europe (In my subjective opinion, currently the most developed state of the human society).

After Xi's reforms China's growth engines would be : More Infrastructure, FDI, Exports, Domestic Consumption, Private Companies, Innovation.

This model could at least save China for 3-4 decades if they could manage to transform to it. But so far they've done great.

Indeed very well !

Salute to you ! A true wise man . U find out the answer from history evolution, Past hundred years of West nation just reduce to decades in China development.

1. Mao reunify China & Chinese
2. Deng open China to the world
3. Xi try to make normal Chinese RICH, not only CCP members.

- Mao brought China to early 19th century West (Nationalization)
- Deng Xiaoping brought China to early 20th century West (Mixed Economy)
- Xi is trying to bring China to post 1950's West (Personal Capitalism, Neoliberalism)

After Xi's reforms China will probably be transformed into a true bourgeois dictatorship just like US is right now. If China even can go the extra mile after 3-4 decades and strike a true balance between the power of elite and power of people it could end up being like Northern Europe (In my subjective opinion, currently the most developed state of the human society).

After Xi's reforms China's growth engines would be : More Infrastructure, FDI, Exports, Domestic Consumption, Private Companies, Innovation.

This model could at least save China for 3-4 decades if they could manage to transform to it. But so far they've done great.

 

[Audio]

Excellent points. We won't know how well this anti-corruption process works until well into the future.

This anti corruption drive is just purging the CCP of an unfavourable faction (Jiang Zemin's one). And it even looks good for the masses. Win-win for the guys at the helm, who ofcourse are clean as a whistle. And debate about their personal fortunes is "discouraged".

 

[LeveragedBuyout]

Swatting ‘Flies’: The Uphill Battle Against China’s Corruption Culture | The Diplomat

Swatting 'Flies': The Uphill Battle Against China's Corruption Culture
Yang Hengjun investigates the role of corruption at the grassroots level.

By Yang Hengjun
October 15, 2014

Before the National Day holiday, I went to Fenghuang and Zhangjiajie, famous scenic spots in Hunan province. It’s been five years since I last visited Golden Whip Brook. When I was there in 2009, I wrote a blog piece about an old woman selling goose eggs who told me that “the Americans have become beggars.” This became one of my most popular blog pieces; nearly all the readers who know my name have read this article. I can’t help but feel a bit regretful – this blog didn’t feature academic theory or clever writing, but only systematically narrated an incident I experienced. It’s easy to see that representative true stories have the most potential to move readers.

This time, I could not find the old lady selling goose eggs in Golden Whip Brook. The tour guide told me that most residents raise ducks; he couldn’t think of anyone who raised geese. There were also more than a few new residential buildings in Zhangjiajie. The last time I was there, the old lady selling goose eggs talked with me about how “Americans want to borrow money from China due to the financial crisis.” This time, my conversations with locals centered on the new leadership’s strenuous fight against corruption. To my surprise, the people of Zhangjiajie, despite low education levels and a constant struggle to feed their families, had very clear views on anti-corruption. One local told me that President Xi’s anti-corruption campaign has good momentum, but it would be very difficult (and would likely take decades) for the campaign to really influence the lives of “low-class people” like himself.

Another local told me that, although those “tigers” were despicable, they don’t directly harm the lower classes, or at least not in a way that people notice. In fact, whenever “tigers” come to visit small towns, they are friendly and cordial. They even push the lower-ranking officials to complete their assignments. But the local-level officials aren’t like that – they associate with villagers day and night. If they have an opportunity for corruption, the locals will really feel it.

A driver told me that the local welfare funds, which were intended for people in need, had in large part been spent on those people with connections to government officials. There were people who received welfare even while owning their own cars. Another local told me, in summary, that the most corrupt officials are village chiefs, town chiefs, or leaders at that level. One local leader gambled all day, every day, and everyone knew about it – and wondered where the money came from. Still, there’s no way to prosecute such leaders.

Compared to the central government, which devotes its energies to catching “big tigers,” the locals I met in in western Hunan province were clearly more concerned about the ubiquitous “flies” they encounter in their lives. Their only criteria for judging the success of the anti-corruption campaign is to see whether or not the “flies” continue to bother them. As for whether or not fighting “tigers” is useful for intimidating the “flies,” almost everyone I spoke to shook their heads. One local believed that maybe that tactic would be useful it there were only a few corrupt officials. But if most officials are corrupt, they know that you can’t catch every single one, so they’re not afraid.

In many such conversations, I got the impression that everyone has high hopes for the current leadership’s anti-corruption campaign. But deep down, most people still believe that no matter how Xi fights corruption, at the present time it will be very difficult to touch every level of cadre, and particularly those who are among the vast number of grassroots officials. For this reason, even though the anti-corruption efforts at the national and provincial level are fierce, the campaign obviously remains distant from the lives of local people.

Because these people cannot envision a future where corruption has been cleaned up, the only way they can avoid being harmed by corruption is to find an opportunity to be corrupt – or to find a powerful backer. Based on this attitude, some grassroots people have developed a deep-set love-hate relationship toward corruption and “undesirable work styles.” They hate it when others are corrupt but will not miss an opportunity to be corrupt themselves. The “tigers” at the top eat the “flies,” the “flies” eat the little people, and the little people are always looking for an opportunity to bully those even farther down the totem pole. In my exchanges with people in Hunan, it was this phenomenon that made me feel both sad and helpless.

What truly makes me feel hopeless is that a culture of corruption has spread to a majority of people; it’s not as simple as being limited to corrupt officials. In one of my conversations, my counterpart sudden became interested in my status. I said that I used to be an official. He immediately asked, “Did you break the rules?” I said no, and he gave me a suspicious look. I said that people can leave their official posts even without breaking the rules, and they can still care about clean government. After that, the previously harmonious conversation between us came to an end because he no longer trusted me. In his view, in all of China there could never be a public servant who left the government without breaking the rules, and afterward cared about clean government.

In one conversation with a tour bus driver, the driver talked a lot about tourism and corruption. I said I was aware of this issue, because I had previously worked as a low-level chief in a government tourism department for over four years. He immediately retorted, “Not possible!” His face was full of disdain. Afterward I understood – in his view, how could a “chief” from a government tourism department spend money on a tour in his broken-down vehicle? He thought I was blowing smoke. Thus ended our conversation about corruption.

These are just some small cases; there are some incidents that I find hard to talk about. Maybe because I’m pale and plump and know how to speak “bureaucratese,” people seemed to think I look and sound more like an official than a blogger. Because of this, while conducting my informal social surveys, I was welcomed and “respected” by many people. But when people discovered I was no more than an ordinary person who detests corruption, they immediately became cool toward me. I even made use of this mentality to fool others. When I was being abused or “bullied” by some low-ranking person, I would “leak” my “identity” in the conversation. That always solved the problem immediately.

In this moment, when the attitudes of ordinary people changed, I saw that there are reasons even beyond the system why corruption is so rampant. I also discovered the root cause of “bullying,” and understood why some people, after causing trouble, will immediately yell, “My dad is Li Gang,” or “I am a bureau chief’s son.” Outside of those few example where news leaked out and the bullying failed, most of the time, when someone yells “My dad is so-and-so,” it really is a useful way to scare off the “wicked people.”

Just like the old lady selling goose eggs, simplicity and honesty go hand-in-hand with ignorance. It’s hard to know whether to admire this, feel sad about it, or despise it. In the world, Chinese people are somewhat rare. Most of them are full of contradictions, both victims and perpetrators. Intellectuals and idealists can sit in their studies and naturally imagine every beautiful kind of justice and goodness. But if you plant your feet on the ground and travel, look, and talk with people, your ideas will be more objective and comprehensive.

A version of this piece also appeared in Chinese on Yang Hengjun’s blog. The original post can be found here.

Yang Hengjun is a Chinese independent scholar, novelist, and blogger. He once worked in the Chinese Foreign Ministry and as a senior fellow at the Atlantic Council in Washington, DC. Yang received his Ph.D. from the University of Technology, Sydney in Australia. His Chinese language blog is featured on major Chinese current affairs and international relations portals and his pieces receive millions of hits. Yang’s blog can be accessed at www.yanghengjun.com.

 

[LeveragedBuyout]

Corruption and a changing China - The Washington Post

Corruption and a changing China
By Jason LyallOctober 27 at 12:53 PM

Plaques featuring Chinese leaders of the past and present are sold at a souvenir stall in Beijing. China’s Communist rulers declared that the country would embrace the “rule of law with Chinese characteristics,” official media reported last week after a key party meeting touted as heralding legal reform. (Greg Baker/AFP/Getty Images)

Editor’s Note: This is a guest post by Jeremy Wallace, an assistant professor of political science at Ohio State University. His research focuses on cities, information and authoritarian politics, especially in China. He is the author of “Cities and Stability,” a book about China’s management of urbanization and authoritarian regime survival.

China is changing. What began as an aggressive anticorruption campaign has grown into something bigger. The Chinese Communist Party is centralizing authority, broadcasting the self-criticisms of local officials and calling for a new morality in public life. The party’s decentralized and technocratic rule is over, replaced with a new, more political mode of governance aimed at better controlling local officials.

The most recent stop on this path to change was a major meeting of the party’s Central Committee last week. It released a communique on ensuring the party’s leadership in “the socialist rule of law with Chinese characteristics.” While the tension between party rule and an impartial judiciary remains, the communique called for concrete steps that should allow judges to hold local officials more accountable for their actions. Courts with cross-boundary jurisdictions may let judges rule against local leaders without having their own resources cut. Future evaluations will also include measures of performance on rule of law indicators.

The centralization’s most noted component is the increased activity and prominence of the Central Commission for Discipline Inspection (CCDI). Under Wang Qishan, the CCDI has targeted more and higher-level officials than previous efforts in the reform era, including Zhou Yongkang, a former Politburo Standing Committee member and Xu Caihou, a former Politburo member and vice chairman of the Central Military Commission. The CCDI has expanded, and its officers have ascended in the local political hierarchy. The center’s agents in the provinces can now check local authority.

The centralization of authority can be seen even in domains such as urbanization policy. As I write in “Cities and Stability: Urbanization, Redistribution, and Regime Survival in China,” the Chinese government has managed urbanization throughout its reign, promoting urban stability and attempting to restrict migration to and the size of the largest cities in the country. However, in recent years, there has been a push in the opposite direction, towards building true megacities in and around Beijing, Shanghai and Guangzhou. Yet this push appears to be more related to the desire for increased central control than purely about urban planning,assaulting the “fortress economies” of the different regions. As Zhang Gui, a researcher at Hebei Technology University put it, “Right now, every official will think of his own region first – from the construction of projects to investment,” because they were judged by the performance of these statistical measures.

This change is more than just centralization. The party has revived the Maoist idea of the Mass Line, encouraging party cadres to share in the experiences of ordinary Chinese and avoid hedonism and extravagance. Some of these officials also engaged in self-criticisms that were broadcast on national television; Hebei’s party secretary Zhou Benshun stated, “I cared very much about development speed and economic volumes but not as much about people’s own interests.”

This self-criticism recognizes the disjuncture between the rapid growth of China’s economic aggregates and the everyday lives of Chinese. Local officials had been evaluated and promoted based on the growth of a few key statistics. How they went about achieving that growth was of less importance for the center. With a free hand, local officials grabbed, resulting in economic corruption and wasteful investments. Even more, I show in a forthcoming paper evidence consistent with local officials “juking the stats,” adjusting politically sensitive numbers (GDP growth rates) at politically sensitive times. The center’s inability to observe local officials may have emerged from a recognition that allowing them freedom of action might encourage growth, but as conditions have changed, that freedom has become threatening.

These economic pathologies come alongside political problems. The pervasive corruption that found China leading a global survey of briberyundermined public confidence in the regime. If the regime’s legitimacy had been in large part based on its performance, controlling local officials that threaten that performance makes political and economic sense. This new mode calls for upright officials to govern China in a traditional, moral manner. Moving the basis for the regime’s legitimacy away from economic performance when it appears that performance is likely to slow has some obvious logic as well.

The party has maintained that while local officials may be corrupt, the center is pure. By tightening the strings controlling local officials, the center is tying its fate to theirs, confident in its ability to change behavior. While the vision of a China governed by the humane authority of a sage ruler has some appeal, centralized power in the hands of a single individual comes with serious dangers. Rae Yang entitled her Cultural Revolution memoir “Spider Eaters” based on a quote from Lu Xun:

Many historic lessons were obtained through tremendous sacrifice. Such as eating food—if something is poisonous, we all seem to know it. It is common sense. But in the past many people must have eaten this food and died so that now we know better. Therefore I think the first person who ate crabs was admirable. If not a hero, who would dare eat such creatures? Since someone ate crabs, others must have eaten spiders as well. However, they were not tasty. So afterwards people stopped eating them. These people also deserve our heartfelt gratitude.​

In this new China, the question becomes has the party learned the lessons of the disasters of Mao’s government by whim.

 

[LeveragedBuyout]

China’s Lurid Tales of Corruption Hide a Second Story - China Real Time Report - WSJ

• 

• October 30, 2014, 5:30 AM HKT

China’s Lurid Tales of Corruption Hide a Second Story
By Yiyi Lu

A street lamp is seen in front of coal-fired power plant in Shanxi province. Dark tales of official corruption have been flowing out of Shanxi since as a result of Chinese President Xi Jinping‘s anticorruption drive, but questions remain over how sustainable the campaign will be.
Reuters
With Beijing now touting its devotion to “socialist rule of law with Chinese characteristics” as part of its drive to clean up the Communist Party, it’s worth recalling a sharp commentary earlier this year by newspaper columnist Cao Lin that reflected on a key feature of news with Chinese characteristics: As soon as corrupt senior officials are brought down, Chinese media are often able to offer extensive information on their depravity and downfall, whereas previously one would be hard pressed to find even a shred of negatives new about them.

“Only the discipline inspection and supervision departments of the Party and the government can strike out at tigers,” Cao wrote (in Chinese), using Chinese President Xi Jinping’s catchword for high-ranking corrupt officials. “The media cannot confront tigers that are still alive. Only after the concerned departments have taken down the tigers, and they’ve become dead tigers, can the media attack the carcasses.”

While Xi’s two-year anticorruption drive has proven immensely popular inside China, it remains unclear how genuine and sustainable it is. In the past, such campaigns were sometimes political undertakings, designed to help new leaders side-line enemies and establish their authority. Once that job was done, the campaign ended and corruption crept back in. Media coverage of recently fallen officials that clearly follows the old pattern suggests the same could happen again.

So far, Beijing’s anti-graft campaign has netted the largest number of tigers in coal-rich Shanxi Province, where soaring demand for energy over the past decade spawned dense webs of officials, coal mine owners and corrupt resource deals. In the course of the campaign, over 50 mid- to senior-level Shanxi officials, including seven ministerial-ranked officials, have been removed from office and placed under investigation. They come from all 11 municipalities of the province.

As the anti-graft campaign leaves a trail of tiger carcasses in Shanxi, a steady stream of investigative reports have also appeared in Chinese media that paint a shocking picture of corruption, power abuse and lawlessness. One example is a recent report (in Chinese) by Honesty Outlook, an antigraft magazine published by the party-run Sichuan Daily, on the dark history of two fallen ministerial-level officials, Nie Chunyu and Du Shanxue.

Both Nie and Du served as Party Secretary of Luliang municipality during its golden decade from 2002 to 2012, when coal prices soared, bestowing massive windfalls on the previously poor mountainous region. During Nie’s tenure, according to Honesty Outlook, the buying and selling of government positions was an open secret. In the fall of 2009, a man claiming to be a vice mayor wrote a post online in which he wrote that his family had pooled 4 million yuan ($650,000) in a failed bid to bribe his way into the mayor’s position. The official who eventually landed the mayoral post was said to have paid 20 million yuan.

Rejecting calls for the author of the online post to be punished, Nie showed his “mild” side, the magazine said. Not only did he spare the vice mayor, he also tried to find other good positions for the losers in the mayoral race to placate them.

The other dead tiger, Du Shanxue, is said to have a far more aggressive leadership style than Nie. A local official told Honesty Outlook how he once saw Du berating a county-level party secretary for half an hour, until the man’s legs trembled with fear. According to a separate report (in Chinese) in China Economic Weekly, a magazine published by the People’s Daily, Du was widely reviled for a massive urban beautification project encompassing all 13 of Luliang’s counties, through which he raked large sums in bribes. The project involved widespread demolitions and disruptions, with much of the construction work going to Du’s relatives and close associates. Furious local residents gave him the nickname “Du Genzi,” a curse that he would die without descendants.

Du and Nie have both been under investigation for suspected “serious discipline violations” – code in China for corruption – since the summer, and have not been available to respond to the stories.

Stories like this have dominated the pages of China’s newspapers over the past month. Nor are they limited to officials. In September, Modern Express, a newspaper published by the official Xinhua News Agency, published a story (in Chinese) on Zhang Xinming, a Shanxi coal baron previously accused of fraud, who was detained in August and stands accused of spending 100 million yuan to bribe police in one major city. Zhang has become known as the “minister killer,” the paper noted, because he is believed to have ratted out two minister-level officials since being apprehended. Like Du and Nie, Zhang has also been unavailable to comment.

The vivid stories flowing out of Shanxi are satisfying to a Chinese public that is weary of corruption, but the circumstances of their publication – always after the suspects have been placed under investigation by the party – highlight the limited role the media and the public play in rooting out corruption. For all its size and power, the party needs help policing its own.

China’s corruption czar, Wang Qishan, has argued for the need to institutionalize the country’s antigraft efforts. The party’s new focus on legal reform, discussed at a plenary meeting of top leaders in Beijing last week, has been cast as one way to do that. Having more respect for the law would certainly help curb corruption and abuse of power, but until the public is given the right to supervise the government, tigers are likely to continue roaming the country.

Yiyi Lu, an expert on Chinese civil society, is currently working on a project to promote open government information in China. She is the author of “Non-Governmental Organisations in China: The Rise of Dependent Autonomy” (Routledge 2008).

 

[TaiShang]

China to protect whistleblowers exposing corruption
Published time: October 29, 2014 09:10

Chinese authorities have said, for the first time, that whistleblowers will receive legal protection amid the country’s ongoing fight against corruption.

The Supreme People’s Procuratorate, the country’s top prosecuting body, said in a Tuesday statement that new regulations outline legal rights for those exposing corruption and other malpractice. It urged people to file their reports via official channels and do it in a “lawful manner” without falsifying the truth.

"The 'regulations governing the work of whistleblowers' require that when the prosecutor's office receives a whistleblowing report from someone giving their real name, it has to assess the risks from the whistleblowing and develop whistleblower protection plans when necessary to prevent and end acts of retaliation against the whistleblowers," Reuters quotes the reported statement.

Last year the Central Commission for Discipline Inspection [the party’s anti-corruption watchdog] launched a new website for whistleblowers. The party also appealed for citizens to report on wrongdoing via a telephone hotline set up by the government. However, authorities don’t provide legal protection to those who make revelations outside government channels. For example, via Chinese social networks or in the mainstream media.

President Xi Jinping has made battling corruption one of the Communist party’s priorities since he took office in 2012. However, the idea of tackling malpractice through whistleblowing has the public suspicious that complaints will be ignored, and there are fears of arrests and further attacks on online whistleblowers.

In mid-October, a Chinese investigative journalist who wrote critical reports on a state-controlled construction equipment maker was sentenced to prison for defamation and bribery.

Since the latest anti-corruption campaign began, several bloggers who posted their allegations online have faced abuse and harassment.

Reuters reported that blogger Li Jianxin was stabbed in the face in July, blinded in his right eye by two unidentified men, who also splashed acid on his back.

CPC's anti-graft campaign will never end

Wang Qishan (left), head of China's top anti-graft watchdog angency, meets David Rubenstein, chairman of the Advisory Board and co-founder and co-CEO of the Carlyle Group, in Beijing, Oct 24, 2014. [Photo/Xinhua]

Senior leader of the Communist Party of China (CPC) Wang Qishan said on Friday the CPC's anti-graft campaign and its efforts to build a clean government will never be concluded.

Wang, secretary of the Central Commission for Discipline Inspection of the CPC, made the remarks while meeting with overseas members of the advisory board of Tsinghua University's School of Economics and Management.

The development path of a country can be observed through not only at the macro level, such as its past and present politics, economy, society and culture, but also the micro level such as an important meeting, Wang said.

The fourth plenary session of the 18th CPC Central Committee, which convened here from Oct. 20-23, has made an overall plan for rule of law in the country, he said.

To govern the country under the rule of law requires managing the party with regulations, he noted.

"The discipline of a ruling party with more than 86 million members concerns its popularity among the people and the destiny of the country," Wang said.

Since the 18th National Congress of the CPC in late 2012, the CPC Central Committee has been strictly governing the party, and improving the party's style of work, building a clean government and combating corruption, he said.

"All these efforts have gained the support of the general public," Wang said.

"This is just the beginning," he said, adding that the party's anti-graft campaign requires consistency, intensified supervision, discipline and accountability.

A clean government and a healthy and fair market offers the best soft environment for investment, he said.

Wang called for the overseas advisors to integrate international resources to give guidance for Tsinghua University's School of Economics and Management, and contribute to the development of China's education cause.

Advisors, including David Rubenstein, chairman of the Advisory Board and co-founder and co-CEO of the Carlyle Group, said they would continue to make positive efforts for China's economic and educational development.

The advisory board, founded in 2000, consists of professors from foreign universities and executives from renowned multinational corporations.

China bans private clubs in historical buildings, parks

China's central authority issued a decree prohibiting private clubs in historical buildings, parks and other public facilities on Monday in the latest crackdown against hedonism and extravagance among officials.

Private clubs set up in historical buildings and parks have damaged public interests, fanned corruption and triggered strong discontent among society, according to the guideline forwarded by the general offices of the Communist Party of China Central Committee and the State Council.

The joint decree was originally made by 10 different ministries.

High-end restaurants, gymnasiums, spas and hotels were among those listed as not allowed to open in historical buildings or parks.

Membership-only clubs inside historic buildings and parks not open to the public must be shut down, according to the decree.

Officials will be held accountable for their negligence and misconduct in the crackdown, it said, adding the public resources of historical sites and parks must be put under public supervision.

Public anger has been rising against private clubs, which are often illicitly built with public resources, sometimes in historical buildings or parks, and frequently visited by the powerful and rich.

The CPC has been effectively fighting corruption since Xi Jinping took the helm in November 2012, targeting official decadence and corruption in its ban of luxury banquets, flower arrangements in meeting rooms, expensive liquor, delicacies such as shark fin, and luxurious gifts during festivals.

Officials are also ordered not to use public money to attend expensive training programs such as EMBA classes to network with businessmen.


Xi says China adheres to socialist path in rule of law

President Xi Jinping said China will unswervingly follow the path of the socialist rule of law with Chinese characteristics on Tuesday.

Xi said the path, which embodies the achievements and experience in building socialist rule of law, is the only right course.

Xi made the remarks in a statement explaining the decisions of the fourth plenary session of the 18th Central Committee of the Communist Party Of China (CPC), which was released on Tuesday. The meeting was held in Beijing from Oct. 20-23.

The meeting decided to advance the rule of law and the overall target is to form a system serving "the socialist rule of law with Chinese characteristics" and build a country under "the socialist rule of law."

According to the decisions, under the leadership of the CPC, China will adhere to the socialist system with Chinese characteristics while striving for a complete law system, effective enforcement of rule of law and strict supervision of the rule of law.

The decisions on "major issues concerning comprehensively advancing rule of law" also said China aims to build a law-abiding government and a law-abiding society.

Xi said while advancing the rule of law, all the work must be done with the focus on forming a system serving the socialist rule of law with Chinese characteristics.

He said realizing the overall target of advancing the rule of law is conducive not only to updating state governance but also to deepening reform.

 

[Jlaw]

In due time not only will corruption tamed, but we will also have independent judiciary system.

 

[TaiShang]

In due time not only will corruption tamed, but we will also have independent judiciary system.

Yes, everything will go on the way China wants, on its own terms and based on its own dynamics. The Western pundits are just making uninvited noise. Their power to bring down governments probably works in Libya, but not in China.

I for long have given up taking them seriously. What a waste of time and effort. Well, if this how they make their living, good for them, nonetheless.

 

[Borr]

That is actually a good sign. Many men got facial imprints from their service time at low ranks.

It is sign that those guys ascended their position via wit, resilence or experience, rather than a good look or canary talks.

Ok, why do Chinese officials esp. local ones, look so ugly! They all have oily faces and nasty bellies. OMG, they disgust me! haha . Some of them are probably my age. With so much money they siphoned from public, cannot they just clean up themselves a bit?

 

[vtnsx]

The anti-corruption is seemingly successful. China need reform, but some government officials, management level from state companies in industries like oil, finance or electricity...these people form many groups, they have common interest, they live by leeching national interests. You are not dealing corruption with every single official, you are facing many groups, their power can reach to Politburo Standing Committee, it's hard. They are the biggest obstacles to reform, since China has made it clear the market will play a decisive role. Only President Xi can crack them down, everyday I keep hearing there is some officials are investigated, this is incredible. Xi's father was once China's PM, so he can do it, he don't fear fighting with corruption. If other leader without such background are pushed to the front line, they can't do better.

Then you must be corrupted. Give me your money!

 

[Aepsilons]

Just like the old lady selling goose eggs, simplicity and honesty go hand-in-hand with ignorance. It’s hard to know whether to admire this, feel sad about it, or despise it. In the world, Chinese people are somewhat rare. Most of them are full of contradictions, both victims and perpetrators. Intellectuals and idealists can sit in their studies and naturally imagine every beautiful kind of justice and goodness. But if you plant your feet on the ground and travel, look, and talk with people, your ideas will be more objective and comprehensive.

Profound.

 

[Edison Chen]

Then you must be corrupted. Give me your money!

LOL, corrputed, based on what? A steamed bun per day, this is all I get to eat. You tell me where my money is.

 

[Aepsilons]

LOL, corrputed, based on what? A steamed bun per day, this is all I get to eat. You tell me where my money is.

I told you before, Ed, stop playing Mah Jong and you'll be richer!

LOL

Kidding!

 

[LeveragedBuyout]

A Record Falls – Along with an Official – in China’s Anti-graft Drive - China Real Time Report - WSJ

• 

• October 31, 2014, 5:51 PM HKT

A Record Falls – Along with an Official – in China’s Anti-graft Drive

Reuters
China likes to do things in a big and record-setting way. Whether it is the height of its skyscrapers, the size of its foreign currency reserves or the heft of its economy – bigger is usually better.

That seems to be true even in the ongoing drive to stamp out corruption.

On Friday, China’s top prosecutor announced that investigators seized a cool 200 million yuan ($32.7 million) from Wei Pengyuan, a former deputy director overseeing China’s coal sector under the National Energy Administration, when he was taken into custody in May.

That was a record haul for China’s graft busters, according to Xu Jinhui, head of the anti-corruption department of the Supreme People’s Procuratorate.

Mr. Wei, who is still being held but has not yet been charged, couldn’t be reached for comment.

The same prosecuting agency said in May that it had placed Mr. Wei under investigation for suspected bribe-taking. At the time it gave no further details, but stories of a huge stash of cold cash had been circulating online.

Corrupt officials in China – as in other countries — are often fearful of depositing ill-gotten gains at the nation’s banks for fear of attracting unwanted attention. That has been particularly true during the current campaign against corruption, which has promised to go after “tigers and flies,” or officials big and small.

On the other hand, that could be inconvenient for corrupt Chinese officials, as the central bank doesn’t issue notes any bigger than 100 yuan.

After Mr. Wei’s investigation appeared in the media spotlight, some online joked that those officials who stashed cash at home at least were helping to hold down inflation. At least they weren’t pouring funds into property speculation.

Prosecutors said there were five other suspects besides Mr Wei who were involved in alleged corruption cases of more than 10 million yuan each.

More In Anticorruption

• Chinese Communist Party Members Urged to Abstain From Mahjong, Other 'Small Thrills'
• Grading China's CEO Pay Plan: Uncle Sam's 'Pay Czar' Weighs In
• Going Once: China’s Corruption Spoils Auctioned on Taobao
• Something’s Gotta Give: A Banker Weighs In on Hong Kong’s Leader
• China Legal Reform Push Could Be Setback for Xi

According to the prosecutors, 35,633 suspects had been placed under investigation for alleged corruption in the first nine months of the year, up 5.6% from a year earlier.

There were 27,235 corruption cases filed in the same period and 84.7% of them involved bribe-taking of more than 50,000 yuan or embezzlement of over 100,000 yuan.

China’s anti-graft bodies have reprimanded at least 40 senior officials, including one of the nation’s former top leaders, Zhou Yongkang. Numerous lesser officials have been ousted for corruption-related offenses. Mr. Zhou has been placed under investigation for serious violations of discipline but has not yet been charged with any crime. He has been unreachable for comment.

–Grace Zhu