Opinions are divided among scholars about the corruption situation before China’s Reform and Opening. Some scholars argued that, as China was still under the planned economy at that time, all the planning, production, and distribution were controlled by the government, the corruption phenomenon was rare under such a rigid management system. Meanwhile, some other scholars pointed out that when the market economy of China was underdeveloped, the market did not function effectively as a mechanism for allocating resources, thus there was much room for “connection” (Guanxi) to enter in, which resulted in serious corruption. This paper will provide a perspective to this disputation by discussing an embezzlement case of the Heilongjiang Province.
This embezzlement case was made public under the “twin-hitting” (Shuang Da) campaign implemented in 1978 with the advocacy of Hua Guofeng. This paper also focuses on the exposing process of the case and points out the disadvantages of anti-corruption campaign.
After this embezzlement case, Liu Binyan, a famous writer and reporter of the People’s Daily, went to Heilongjiang Province, carried out field study, and wrote the reportage Between human and demon (Ren Yao Zhi Jian) which received a warm response. This reportage not only includes a lot of details of the embezzlement case that were not mentioned by the authorities, but also analyzed the basic social reasons of it. Since Liu Binyan’s argument was different from the mainstream opinion within the Party, a fierce debate took place afterwards, which revealed the limitation of anti-corruption activities led by the Chinese Communist Party.
By the discussion of the case, it can be concluded that there had been serious corruption under the China’s planned economy. And three reasons of corruption can be summarized: 1) “absence of ownership” caused by public ownership, 2) serious human dependence in bureaucratized companies, and 3) the over-importance of connection due to shortage economy. Meanwhile, the anti-corruption campaigns, like the “twin-hitting” (Shuang Da) campaign, tend to transform into private conflicts on the local level, thus weakening the effect of anti-corruption. Furthermore, the corruption exposure activities supported by the Party’s high level officials, like Liu Binyan’ reportage, would not be allowed by the Party when they challenged the reign of the Party. These are considered to be important reasons why China can not eradicate corruption.
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