“China is a rule of law country . It is much better than before.” – comment on a social media site for networking in China.
The comment above shows a common untruth propagated by foreigners and companies working in China. The idea is to convince those of you who have never worked here, that business in China is not much different than business back home.
Unfortunately, nothing could be farther from the truth. The danger of such comments and the mutual admiration society that propagates such myths, is that they shield potential buyers of Chinese products and stocks as to the reality of what goes on in China today.
In order to clarify, in this article I will explain what the rule of law means, why it is useful and how and when it does not apply in China. I will then explain why this should be a concern to everyone.
As China invests in our countries, sells stock on our exchanges, and becomes integrated into our economies, we must truly understand her. It is imperative to have a working knowledge of how China operates, including the weak legal system and the power of the communist party.
These are two key elements of the problem with the ‘rule of law’ and China. As the world admires China for her advances, they often fail to acknowledge such inconvenient truths.
Vested Interests Shield the West from the Truth
Vested interests fail to advise the Western world of the true power that the communist party still has, and its impact on most everything that happens here. The reasons are many.
Outside of China, Chinese leaders are reluctant to admit that they share a repressive form of governance that is known for its brutal and unjust nature. To proclaim their ‘communist nature’ beyond their borders is less than appealing. After all, who wants to be known to share a governmental structure with a country like North Korea, one of China’s best friends?
As for the Chinese people, it embarrasses many of them to be associated with communism and all of the negative baggage associated with it. They realize that the image of communism is not favorable outside of China, and thus they seek to avoid this topic.
What the typical person here will do is to call China a “socialist” state, ignoring the facts.
Downplaying the “Communism” in China
Businessmen, as well, wish to play down the ‘communist’ aspect of China. It is hard to tell the good folks back home that communist countries like North Korea are part of the ‘axis of evil’, yet China, who is also communist, is not that bad.
In addition, how do we justify the toppling of the former Soviet Union in order to thwart the spread of communism and its harmful ways, yet we rush to support China and its growth? How does one justify communist China becoming a banker and key partner in trade for free and democratic countries around the world?
It’s not in the best interest of a business to allow the consumer to know that those Chinese companies listed in the USA stock market ALL have communist party oversight. In China, this is a must. But of course, how many of us really know this?
And how about the comment that “China is a rule of law country”? This is nothing less than the white-washing of truth by entities whose interests goes no further than the 1’s and 0’s in their sales ledgers.
Rule of Law in China
The rule of law is essential for a healthy nation. At its most elemental level, the rule of law is defined as follows:
“The Rule of Law, in its most basic form, is the principle that no one is above the law. The rule follows logically from the idea that truth, and therefore law, is based upon fundamental principles which can be discovered, but which cannot be created through an act of will.
The most important application of the rule of law is the principle that governmental authority is legitimately exercised only in accordance with written, publicly disclosed laws adopted and enforced in accordance with established procedural steps that are referred to as due process. The principle is intended to be a safeguard against arbitrary governance, whether by a totalitarian leader or by mob rule. Thus, the rule of law is hostile both to dictatorship and to anarchy.” (2)
Thus, in a rule of law country, laws are predictable, fair and equal. The necessity of such a system is obvious. If one is going to do business or live in a country, then one would like to know the acceptable parameters for behavior, both good and bad.
Contracts, for instance, are deeply rooted in trust in the law. It is assumed that the signing of a contract establishes a mutually agreed upon set of actions and consequences.
Predictability is essential to the process. If the law is adequate then one can trust in a contract. This is true because a contracting party can be sure that even if the other party to the contract does not uphold their obligations, then one can resort to legal measures. In a rule of law country, this means that justice will be done.
The lack of rule of law and an unpredictable legal system destroys trust. The mandates of a contract become useless if they will not be upheld. Thus, for those who wish to promote doing business with China, it is essential to foster the belief that China is a rule of law nation or progressing that way.
For if China were proven to have a weak legal system with no rule of law, then how could one justify investing billions upon billions of dollars here? (3)
Evasion Tactic – Compare China to America
What many apologists do, in order to make business in China seem less of an outlier, is to say that the US at times is not a ‘rule of law’ country. The idea is to convince us that China is not that bad; not much different than we are.
These apologists are correct in their assertion that the US and all countries have instances where the rule of law has been cast aside.
Some would argue that the Teddy Kennedy Chappaquiddick incident (4) proves this, or the Trayvon Martin Case.
The truth is that every country has examples of when they have failed to uphold the rule of law. What must be understood, however, is where a country stands in the rule of law spectrum. In other words, how often is the rule of law upheld.
The apologists are aware that many US citizens acknowledge the shortcomings of our country. The problem is that when it comes to China, many of us operate with incomplete information. Lacking complete information, it is easy to be manipulated into believing half-truths about the People’s Republic of China.
Thus, when an apologist references a case like Teddy Kennedy, the commoner may tend to agree with the apologist. The problem is that China is not a ‘full disclosure’ country. In order for the facts to come out, they usually must be vetted at the highest levels.
Consequently, most of what we hear about china is merely the tip of the iceberg, we know so little.
“China’s central authority’s decision to investigate Bo Xilai’s serious discipline violations and his wife’s case shows respect for the rule of law, local officials and civilians said on Friday (5) .-Chinadaily.com
China, not surprisingly, would like to have us believe that laws and not communist party dictates, govern their country.
In order to buttress this contention they can point to the Chinese constitution, a beautifully crafted document replete with laws befitting the most advanced countries. China’s laws, which were penned by the best and brightest of the international community, oftentimes hold little sway over communist party dictates. (6)
The rule of law with “Chinese Characteristics” can best be showcased by China’s actions rather than their words. An excerpt of China’s treatment of the Bo Xilai scandal serves as a good example.
The Bo Xilai Case
Xinhua, another communist party paper, published an article entitled “Rule of law, purity of party highlighted in handling Bo’s case,” which said that the official investigation into Bo’s “serious violations of discipline” have won wide support from the public and prove how China is a country ruled by laws and not the whims of its leaders.”
The propaganda department of the communist party would have us believe that by seeking prosecution of a high flying official, that China is pursing the dictates of a rule of law country. The reality of the event, however, shows how far from the truth this really is.
As if often the case with China, they leverage the press to push forth an agenda or belief that has little basis in fact. The reality is that the detainment of Mr Bo and his wife offer nothing less than insight into communist party politics and the malleable nature of law in China.
For example, Mr Bo and/or his wife are allegedly behind the murder of Neil Heywood, an English friend of the family. The death and subsequent cover up of the cause of Mr Heywood’s demise occurred at a time when Mr Bo was still the ‘darling of Chongqing’ and positioned for one of the top three spots in China’s hierarchy.
Had China really been a rule of law country, would they have allowed for the cremation of Mr Heywood’s body such that no autopsy to ascertain the cause of death could be performed? Would they not have been just aggressive in pursuing justice when Heywood died in 2011 as they are today in pursuing Bo or Gu’s role in the death?
Aside from this, it is alleged that while operating as a communist apparatchik in Dalian, China, Mr Bo in Chongqing was personally responsible for the torture and death of at least three people, but in his tenure that figure is much higher. (7)
Whats more, it is alleged that Bo was behind the bombing of an airplane that took 100 lives (8), one of whom was a political foe of Bo Xilai. This fatal event occurred over a decade ago when Bo was the powerbroker in Dalian, but why has it just come to light?
Would a rule of law country allow ten years to pass before outing one of its party loyals to come under investigation for such a harrowing event?
Impartial Application of Justice
A basic tenet of rule of law is the fair and impartial application of justice. By waiting such a protracted period to act against Mr Bo, one has to wonder if his communist party position had anything to do with the decision to not punish Mr Bo’s act. Why did they wait until he had alienated the party?
Rule of law means justice, but not the guarded threat of punishment to be wielded like a weapon and used when one alienates the powers that be. In the case of Bo Xilai, the latter seems to be the case.
Expounding on this, one can analyze the treatment of Mr Heywood’s wife and how the rule of law applies to her. After the case into the death of Mr Heywood was reopened, his widow Lulu- a Chinese citizen, is reportedly being barred from speaking with the press. In addition, Lulu is not allowed to receive visitors and Chinese PLA guards surround her home. (9)
Apart from that, Lulu has been told that she must not communicate with the press. While she has broken no laws, her constitutional rights to freedom of speech, and association, as articulated in Article 35 of the 1982 state constitution have been violated. (10) In a rule of law state this would not occur.
Worse yet is the fact that the journalist to break the news of the connection of Bo Xilai’s family and Mr Heywood was thrown in jail for breaking the news. (11) This also, shows that the rule of law in China is not consistently applied.
The reality is that the ex-post facto handling of Mr Bo and his alleged transgressions appears more like a party ‘witch hunt’ a-la the purges of the 60’s and 70’s, than the strict application of law. And this misapplication of laws is a prevalent theme witnessed by several recent marquee events. China’s toxic melamine milk scandal is a prime example.
Although the truth was not told until after the Olympics had passed, the communist party had foreknowledge that poisoned milk was being used by Sanlu as far back as 2005-6. Deaths from Sanlu milk were reported and investigated even as late as July of 2008.
Tian Wenhua, the GM and communist party Secretary was apprised of the problem and assisted in its coverup. Even though Ms. Wenhua had supposedly told the central government about the problem, pre-Olympics, she was told to remain mum, and so she did.
The party was holding the Olympics and such a scandal was the last thing they needed. The communist party had set aside the rule of law so that their keystone event would not be marred. Hosting the Olympics and providing a nice image does not take precedence over pursuing justice, when a country correctly applies the law.
References & Image Credits:
(1) Our Civilisation
(2) Lexis Nexis
(3) Interestingly enough, China is ranked highly in contract enforcement. The reasons for this ranking are many and beyond the scope of the current article.
(5) China Daily
(6) Carl F. Minzner, China’s Turn Against Law , Fordham Law School, American Journal of Comparative Law, 2011
Washington University in St. Louis Legal Studies Research Paper No. 11-03-01, http://ssrn.com/abstract=1767455 ;, “ Within months, Chinese courts were enmeshed in the “Three Supremes” campaign, which emphasized Party doctrine and populist sentiment as equal (if not superior) to the constitution and law as sources for guiding judicial work.
(8) Want China Times
(9) Daily Mail
(11) Want China Times