Disposing of an Industry's Black Veil

From cover, issue no. 386, Sept 22, 2008
Translated by Ren Yujie, Zuo Maohong, Liu Peng
Original article: [Chinese]

Comparing with previous public health and safety scandals, the recent exposure of melamine-laced milk products is much more astonishing and depressing.

The number of well known enterprises and branded dairy products involved have stunned the public, overthrowing the ingrained prejudice that only illegal backyard workshops were capable of such violation.

More depressingly, the recent scandal has unfolded in a déjà-vu manner for major public incidents -- cover-up, delayed exposure, silenced the whistle-blower, taking defensive stands, finger-pointing, and then came the sacking of officials and swift revamping of the entire industry concern.

Without exception, each scandal would place the related administrative agency under pressure, and it appears that taking action against administrative officials for "leadership problem" has become a routine solution.

Yet the public has become increasingly dissatisfied with post-scandal damage control measures. Prevention is better than cure, but would it be unrealistic to demand administrative agencies to guarantee an incident-free environment? Especially when an industry has so many enterprises and players.

The above line of thought thus bring about the repeated calls for self-discipline among industry players and the need to instill high business ethics. However, some argue that when taking in the subjective matters of morality and conscience into problem solving, things seem to be even more intangible.

In fact, the issue of business morality may not be that intangible if viewing it as part of a culture, which depended on the larger societal system to nurture and shape.

Morality requires trust, and trust evolves partly from predictable behaviour, which in turn demands standardized and consistent conduct. An honest and efficient government, a relatively independent judicial system, all-pervasive journalists, a highly-self-disciplined society... All these prop up a favorable environment and social system.

The question is: what has hindered the above-mentioned elements from exerting their influence over our society?

The interlocking relationships and joined interests between politicians and businessmen, local officials and local businesses, have often been cited as the core contributor to nearly all public health and safety incidents in China in recent years.

To the general public, some local grassroots officials, who function as a bridge between supervisory administrative agencies and industry players, are the chief culprits for a dysfunctional system.

Local protectionism has long been a target for criticism. Even the superiors of grassroots officials appear to be incapable of reigning in local situation, and for this failure, the administrative chiefs took the blame for their subordinates' wrongdoings.

Some suggested that former Shanxi province governor Meng Xuenong, who resigned over the collapse of a dam that killed hundreds, was the sacrifice lamb for the misdeeds of local grassroots officials.

However, why so many local officials would risk to protect problematic companies is far beyond the explanation of lack of party disciplines and moral degeneration. Blaming local officials does not solve the root of the problem.

When an administrative system rates its officials' performance and honor based on local economic growth, the system in itself is a hindrance. Local officials are trapped in conflicts of interests while pursuing high growth rate through ensuring companies' profits while juggling with goals of public welfare delivery.

More often than not, local officials would side companies' interests for economic growth, rendering the judicial process or media scrutiny toothless. Under such an administrative framework that blends politics and commerce,  it has negative impact on nurturing a culture of business morality. 

When it comes to exposing the black veil of an industry, in some of the more matured market economies, that usually refers to unraveling the dark side of certain business practices, and rarely about the linkage between politics and business.

In those countries - business, politics, and judiciary are three separate entities, but what about here in China? Would the arrest of some "conscienceless businessmen" or "evil mining bosses" solve scandals related to public health and safety? Would such "justice" stop the public from questioning defects in the system?

Therefore, one urgent challenge facing us today is the rethinking of a system that would better balance the interests of various parties while promoting economic growth and welfare delivery.

If the root of the problem is not solved, it could lead to a collective feeling of exasperation and powerlessness among dedicated officials, concern public and the media, which has repeated similar scandalous story telling countless times.