At Large

Corruption Haunting China

Some habits are too ingrained to be eradicated.

By 1.26.14

UPI
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There is a practice in China that has been going on for many generations, but most prominently since the expansion of trade with the West in the 1800s. It has become accepted that whenever an advantageous exchange occurs a material or monetary “grateful thanks” will be offered. This is called a cumshaw, a foreign bastardization of the Mandarin, and it can be anything from a hotel gratuity to some special “additionality” to a multi-million dollar industrial deal. Under recent communist governments officials at all levels, including generals, have become rich by receiving cumshaws after approving certain civilian contracts and military purchases. What originally was a custom expressing thanks to an impoverished servant has led to high-level corruption — and China’s new president wants it rooted out.

If the State Department of the United States were not so pre-occupied with trying to extricate itself from its miserable performance under the last two world-traveling secretaries, it might have been able to focus on America’s greatest competitor who also happens to hold the single largest portion ($1.317 trillion) of the immense foreign debt of the United States. China is going through a period of dealing with historic corruption. Less than fifteen months ago China’s new president, Xi Jinping, warned that he considered his country infected with the disease of what he referred to as “rampant corruption and bribe-taking.”

The year-long investigation begun by President Xi purposely has centered on senior civilian officials and top officers of state-owned companies. The military connection, which is far more devastating to the nation’s economic probity, has remained one of Beijing’s most closely held study subjects. Focus is placed on rockets to the moon and the dangers posed by the U.S. Pacific Fleet when China’s greatest economic and political problems remain in its own socio-cultural infrastructure.

Tying together this practice of high level gratuities that give recognition of the special relationship between “giver and receiver” is the very active practice of guanxi. This is an activity not unlike the networking among people of the West who have similar backgrounds, economic and political ties, and club relationships that are often tied to fraternities of university days. The broader and more influential one’s guanxi, the more effective is one in his business and political dealings.

The Chinese Communist Party developed its own guanxi over the years in which having participated in Mao Tse-tung’s Long March  — and later being related to someone who had been on the March — was the single most important element in post-WWII networking. This shared experience in the revolutionary development of modern China tended to fall apart during the Cultural Revolution, but has since returned with a new vigor. When President Xi speaks of bringing back “old values,” he means a reformation and reconstitution of this commitment and its relationships that were the initial factors that brought about cohesiveness in the leadership of contemporary China. It is not unlike the siloviki of intelligence and security backgrounds who helped build and protect Vladimir Putin’s post-Brezhnev rise to power.

The new guanxi of China today may be broader and more inclusive of both civilian and military leadership components within the Party, but it’s just as calculated. What makes any congress of interests work, however, is the discipline and loyalty of the participants and a careful division of the advantages gained by the special status. The fraternal links with disgraced Bo Xilai, ex-party secretary of Chongqing and son of a former prominent Long March veteran, have been tracked down and detained.

Following Xi Jinping’s general directions, the Party’s Discipline Inspection Commission has rounded up major executives in the oil and gas industries who had close ties with a former member of the Politburo Standing Committee — who was also a close friend of Bo Xilai. The former head of the State-owned Assets and Supervision Commission, part of the same “Bo club,” was also detained. High and low level managers are under scrutiny as the Office of the President keeps careful tabs on the roundup.

President Xi Jinping obviously intends to cleanse the workings of both the government and private sector. The military is undergoing a similar “purification,” even if it’s far less public. Any anti-corruption campaign of this note in China includes military relationships with private suppliers, both foreign and domestic. The relatives and friends of on-duty officers as well as many retired generals have ownership positions and/or employment in various industries and trading firms. The guanxi is extensive and intricate. China’s new and vigorous leader has his hands full.

Aside from the few branch and desk officers in Washington specifically concerned with matters of the Peoples’ Republic of China (PRC), little attention is paid by the political echelon of the Obama Administration to matters Chinese. Every now and then some interest is shown by the policy planning element of the Pentagon to the growing power of the Chinese in space and at sea — but not to the degree the issue demands. 

Conflict between China and Japan regarding ownership of some small islands in the East China Sea did bring a statement from the State Department. But the muted reaction of the Secretary of Defense over Beijing’s declaration of an expanded new maritime and air defense zone in that area gives some idea of the lack of priority or even attention being paid by the White House to the largest still-communist country in the world. Somehow President Obama’s call for a “pivot to Asia” just doesn’t seem to have stirred his foreign affairs bureaucracy. It seems like a good strategic time for President Xi Jinping to do some house cleaning while attention is elsewhere.

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About the Author
George H. Wittman writes a weekly column on international affairs for The American Spectator online. He was the founding chairman of the National Institute for Public Policy.