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China's Slavery Scandal Reveals Weaknesses in Governance
Willy Lam, The Jamestown Foundation, China Brief
8/25/2007

The slave labor scandal in Shanxi Province has exposed not only the near-barbarity of the “early stage of capitalism with Chinese characteristics” but also the deep-seated administrative malaise in the Chinese system. Since early this month, the nation has been stunned by reports revealing that more than 1,000 “slaves,” including children and mentally retarded men, were working for long hours with no pay in primitive brick-making kilns in hilly and remote counties in the underdeveloped province. Investigations ordered by the Chinese Communist Party (CCP) leadership have discovered that massive kidnapping and smuggling of children and youth—and their subsequent enslavement in shoddy kilns, mines and other makeshift workshops—has taken place in Shanxi during the past few years. While some 359 victims have so far been rescued, the shocking incident is a slap in the face of the “putting people first” and “harmonious society” credos of Chinese President Hu Jintao and Premier Wen Jiabao.

More importantly, the scandal has revealed serious lapses in the administrative ability of both Beijing and the provinces. In spite of the fact that President Hu had launched a full-year, Maoist-style ideological campaign in 2004 to “raise the governance capability of party cadres and members,” poor governance and corruption has persisted throughout all levels of the Chinese government. Aside from the slave labor scandal, for instance, the Shanxi provincial government has also been responsible, in numerous cases, of the gross mistreatment of urban workers and peasants. Thousands of mostly migrant laborers from the outer provinces have died or sustained heavy injuries in coal mines that lack rudimentary safety measures. Additionally, little has been done regarding the upsurge in cancer incidence rates in towns and villages: three among the country’s ten most polluted cities are located in Shanxi. Provincial authorities have also turned a blind eye to collusion among local cadres, triad bosses as well as private entrepreneurs, who are responsible for the practice of human trafficking and slave labor.

Officials in the provincial capital of Taiyuan, however, have apparently been successful in keeping eyesores from Beijing’s knowledge—largely through forbidding local media from reporting “negative news.” This is despite the fact that since taking power in late 2002, Hu and Wen have made frequent inspection trips to the provinces; ministries and departments in Beijing have also periodically sent “work teams” to the localities to ferret out instances of corruption or dereliction of duty. In early 2003, the Hu administration also erected a 24-hour, fully computerized “advance warning” systems in Beijing—in units including the Ministries of Public Security and State Security—as well as in major cities to tackle tufa (“unexpected” or emergency) events ranging from riots and acts of urban terrorism to large-scale fires, traffic and mining accidents. These expensive mechanisms, however, have not been functioning well. The brick-kiln scandal came to light only after a few Henan Province papers and websites earlier this month had carried the appeals of 400 Henan parents who suspected that their sons had been kidnapped and “sold” to slave masters in neighboring Shanxi (Dahe Forum, June 5).
Alarmed by the negative national and global impact of the slave story, Hu and Wen, together with three other Politburo members, gave stern instructions in mid-June on exterminating the practice immediately. It is symptomatic of bureaucratic overlapping and the lack of clear-cut division of labor among central units that “special work teams” were dispatched to Shanxi simultaneously from four different departments—the Ministry of Public Security; the State Prosecutor’s Office; the Ministry of Labor and Social Welfare; and the CCP-affiliated All-China Federation of Trade Unions. It is also a testament to the indifferent attitudes of regional bureaucrats that Shanxi officials started taking action only upon receiving Hu and Wen’s instructions. Shanxi Party Secretary Zhang Baoshun said his province would “seriously implement the important decrees of the central leaders.” On June 18, the first of the kiln bosses were arrested. A few days later, Shanxi Governor Yu Youjun accepted responsibility for the law-and-order breakdown in his province and tendered an apology to Shanxi residents, the central leadership as well as the victims and their parents (People’s Daily, June 20; Wen Wei Po, June 22; Outlook Weekly, June 24).

In his self-criticism, Governor Yu admitted that the incident “has exposed the low political aptitude and awareness of cadres in the party, government and enterprises.” He added, “They have not established the concept of administration for the sake of the people.” Yu also told the hundreds of Chinese and foreign reporters who had converged in Taiyuan that “Shanxi Province welcomes supervision from the media” (People’s Daily, June 22). There is widespread suspicion, however, that Zhang, Yu and other senior cadres have consistently muzzled the local media regarding mishaps in the province’s tens of thousands of illegally or improperly run mines, factories, kilns and workshops. This is despite the fact that prior to his transfer to Shanxi, Zhang had served as the Vice Director of Xinhua, China’s largest news agency.

A few of the more liberal local papers outside Shanxi have taken advantage of the furor to report that despite the tough action taken during the past fortnight, the basic problem of local officials providing shelter to illicit mine and kiln owners has remained unresolved. For example, at least two-thirds of the brick kilns in remote counties in Shanxi remain unregistered. A State Council edict last year forbidding officials from becoming investors in private coal mines and other small-scale but lucrative businesses has also not been fully observed (Chongqing Morning Post, June 20; Xiaoxiang Morning Post, June 22). In other words, unless there is rigorous pressure from the Politburo—or from the Hong Kong and overseas media—many more of China’s long-suffering migrant workers and uneducated children will continue to be exploited in Shanxi.

The Shanxi disaster has proven particularly embarrassing for President Hu because several of the recent regional scandals have taken place in provinces run by potential Fifth Generation leaders from his own Communist Youth League (CYL) Faction. Shanxi Party Secretary Zhang, 57, worked together with Hu in the CYL Central Committee when the latter was CYL chief in the mid-1980s. Zhang was transferred to Shanxi as acting governor in early 2004. While Governor Yu, as head of the provincial government, has borne the brunt of the responsibility for the “slave labor” incident, it is clear that Zhang’s career has suffered a setback. After all, Zhang's status as the top cadre in Shanxi means he will have to shoulder at least some of the political responsibility for the poor state of his populous province.

In similar fashion, the reputation of the Party Secretary of Jiangsu Province, Li Yuanchao, has been dented by the uproar last month over the dangerous water quality of Lake Tai, one of the most famous scenic spots in southern China. Several lakeside towns, including the historic city of Wuxi, have depended traditionally on the lake for drinking water. Now Lake Tai is so laden with silt, chemicals and metal particles that its water is blanketed with rancid, blue algae, and it is not fit for even washing clothes. Li, 56, another CYL stalwart, is even closer to President Hu than Shanxi’s Zhang. The fast-rising star from affluent Jiangsu has often been mentioned as a possible successor to Hu.

Usually deemed an efficient administrator, Li did not pay a visit to Lake Tai and Wuxi until the international press had reported a mass exodus of residents from the boomtown. Yet, blue algae had first been found in the lake in 1990; and the State Council had in 1998 earmarked more than a billion yuan to purify the water. Jiangsu officials, however, waited until Premier Wen personally instructed them to improve the Lake Tai situation before issuing ironclad orders to a few hundred chemical factories in the vicinity to close down. Unlike his counterparts in Shanxi, however, neither Li nor any of his senior colleagues bothered to offer an apology. Several lower-level bureaucrats were instead made scapegoats and either fired or demoted (Xinhua Daily, June 1; Associated Press, June 12; Ming Pao, June 25).

With the 17th CCP Congress approaching in October, the attention of ordinary party members and the nation’s intelligentsia alike is very much focused on the dramatic deterioration of governance at both the central and local levels. The Wen cabinet has failed, despite repeated attempts since 2004, to tame the "irrational exuberance" in sectors ranging from iron and steel to the real-estate market. The bull-run on the Shanghai and Shenzhen stock markets has raised alarm bells not only in Beijing and Hong Kong but also in London and Washington. Incidents similar to those in Shanxi, Jiangsu and a host of both wealthy as well as poor provinces have further called into doubt Hu’s ability to rein in regional cadres who have flagrantly run afoul of central edicts. As the belated firing of former Shanghai Party Secretary Chen Liangyu last September illustrated, the CCP leadership has now resorted to questionable tactics, such as wielding the “anti-corruption card,” to get rid of particularly defiant “warlords.”

In theory, large-scale personnel changes scheduled for the 17th Congress should give the CCP leadership an opportunity to restructure its ranks and induct not only younger but more capable and forward-looking cadres into senior party and government slots. The preoccupation of Hu, Wen and powerbrokers such as former president Jiang Zemin and Vice-President Zeng Qinghong, however, is to maintain an overall factional balance so as to attain “political harmony.” Given the party’s ironclad hold over the army, the police and other elements of China’s formidable control apparatus, it is unlikely that massive popular frustration, or demonstrations and riots, over scandals such as those in Shanxi and Jiangsu can prod the powers-that-be into considering real and thorough reform

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