Organizer: Andrew Wedeman, University of Nebraska
Chair and Discussant: Richard Baum, University of California, Los Angeles
Although Johnson has argued that high levels of corruption may lead to disintegrative regime crises and many observers assert that "endemic" corruption in China signals the decay of CCP's rule, in the absence of observable social unrest it remains unclear whether corruption does in fact have tangible political consequences or is simply part of the political "background noise." To determine whether and how corruption affects politics, this panel analyzes specific types of corruption and their political consequences. Lu Xiaobo analyzes bureaucratic corruption from a Weberian perspective, arguing that such corruption not only results in predation by the state on society, it also infringes on the power of the political leadership, ultimately producing a degenerate form of "booty socialism." Andrew Wedeman examines the misappropriation of agricultural purchase funds by local governments, asserting that even though this form of institutional corruption represents an economically rational use of scarce capital, the state's failure to pay cash for purchases not only enrages farmers and may, in extreme instances, lead to riots, it also increases inflation and can lead to urban unrest. James Mulvenon examines the impact of corruption on the PLA, arguing that corruption creates serious internal contradictions within the military and between the military and political leadership, thereby weakening the state's ability to mobilize coercive power. Melaine Manion shifts the panel's focus, analyzing the relationship between political expectations and corruption in Hong Kong. Manion argues that mounting corruption is a consequence of declining regime confidence. These papers, therefore, suggest that although corruption may be ever present, specific types of corruption have tangible and adverse political consequences.
Booty Socialism, Bureau-preneurs, and Economic Development in China
Xiaobo Lu, Barnard College; Sun Yan, City University of New York
Political corruption is nothing new in human society. Neither is it a novel subject in social science research. However, if anything, it remains one of the most debated and contentious topics among social scientists on the definition, causes, as well as effects of corruption. The "moralist school," which had dominated the field until the 1960s, saw corruption as a degenerating and destabilizing phenomenon detrimental to political and economic development. Since the 1960s, the field was influenced by the "revisionist school" which argued that corruption not only facilitates economic development, it also helps stabilize political systems by offering opportunities, through illicit actions notwithstanding, to those who would otherwise have had no chance in accessing bureaucratic decision makers.
This paper intends to join the debate on consequences of corruption by looking into the role of the state in economic development in reforming China. I will adopt the Weberian model of "patrimonial state" where the struggle is lodged among the ruler, the staff, and the masses-a three-way struggle rather than oft-adopted dichotomy of state vs. society. The paper will show that Chinese bureaucrats have gained in what Weber has called "the appropriation" process where they not only pray on the masses, but also encroach upon the interests of the state, similar to those found in some developing nations (e.g., Indonesia). Such "booty socialism," with the state coffers and pockets of common folks being looted by what I call "bureau-preneurs," renders a short-term illusion of boom and rapid growth. Yet it also seeds many potential problems and long-term, sustainable development will suffer.
Soldiers of Fortune: Military Corruption in Post-Mao China
James Mulvenon, University of California, Los Angeles
Corruption has become virtually endemic in the People's Republic of China (PRC) since the onset of post-Mao reforms, pervading both the governmental and private spheres. One particularly troubling phenomenon is the increase in corruption among the officer corps of the Chinese People's Liberation Army (PLA), whose participation in commercial activities has facilitated access to new opportunities for profiteering and embezzling. This paper proposes to study military corruption in the PRC, employing key concepts from Joseph Nye's cost-benefit model to evaluate the relative effects of corruption upon Chinese party-military relations, PRC regional security and the PLA's drive towards greater "professionalism." It concludes that, unlike instances in command economies where corruption can serve an "integrative" purpose (i.e., alleviating shortages or correcting systemic inefficiencies), military corruption in the PRC is completely "disintegrative," because it undermines the basic institutional ethoi of a "professional" military (i.e., discipline, egalitarianism, and sacrifice). These trends have a number of possible short- and long-term consequences, ranging from military readiness in small regional conflicts to various scenarios of military "involvement" in the post-Deng succession crisis.
Stealing From the Peasants: The Political Economy of the Misappropriation of
Agricultural Purchase Funds in China
Andrew Wedeman, University of Nebraska
Since the late 1980s, China has experienced repeated problems with the misappropriation of funds allocated by the central government for the purchase of key agricultural commodities. Rather than holding onto the cash allocated to them, many localities divert these funds, using them to finance local industrial development, engage in real estate speculation, or lend them out to outsider investors. Because once diverted funds frequently cannot be recovered in a timely manner, these localities then find themselves unable to pay peasants for crops sold to the state and thus issue IOUs, many of which are not redeemed for months. This paper examines the political and economic consequences of IOUs, focusing on the relative efficiency of legal versus illegal allocations and peasants' strategies to deal with IOUs. The paper finds that by diverting capital from the sluggish agricultural sector to the more dynamic urban-industrial sector, and from the sluggish interior to the dynamic coast, the misappropriation of these funds may actually represent an optimal use, given capital shortages. Politically and economically, however, misappropriation has serious negative consequences. Denied payment for their labors, peasants must choose between acquiescence, revolt, flight to the cities, or cutting back on production. Although they may prevent rural revolt, flight and cut-back create additional problems for the state in urban areas. Uncontrolled migration to the cities leads to the emergence of large "floating populations." Production cut backs reduce the supply of key commodities and thus fuel inflation. The resulting combination of inflation and urban unemployment thus create conditions conducive to urban unrest. As a result, even though this form of institutional corruption may solve one economic problem, it spawns additional political and economic problems that outweigh its macroeconomic benefits.
Corruption and Anti-Corruption in Hong Kong
Melanie Manion, University of Rochester
According to a wide variety of sources, a situation of widespread corruption and a general view of corruption as usual or normal characterized Hong Kong as recently as the mid-1970s. Indeed, descriptions of the situation a couple of decades ago in Hong Kong strongly resemble those of the current situation in the People's Republic of China (PRC)-despite the differences between Hong Kong and the PRC.
This paper examines the effort by the Independent Commission Against Corruption (ICAC) since its creation in 1974 to eliminate endemic corruption and a culture of corruption in Hong Kong. A particular research interest is to assess the impact, on corruption and anti-corruption in Hong Kong, of the economic relationship with the PRC and the shadow of the post-1997 future. Each of those elements of involvement with the PRC has grown over the past decade, at the same time as endemic corruption and a culture of corruption has increasingly characterized economic and political life in the PRC.
Primary sources for the paper include interviews, official accounts, statistical reports and findings from a set of eleven mass surveys, commissioned by the ICAC in 1977-94, made accessible to me and presented here for the first time as part of an academic inquiry.