China: country of corruption

Liao Mengjun (15) died at his school in Foshan, China, with officials alleging suicide. His...
Liao Mengjun (15) died at his school in Foshan, China, with officials alleging suicide. His parents believe he was killed because they spoke out against illicit fees and other graft.
Corruption is an everyday experience for millions of Chinese. The problem threatens China's stability and political system. Mark Magnier, of The Los Angeles Times, reports from Foshan in China.

The last time his parents saw Liao Mengjun alive, he was heading to school to pick up his junior high school diploma. A few hours later, they were called to the morgue.

They found that their lanky 15-year-old son's forehead had been bashed in. His right knee jutted through the skin.

Both his arms had been broken. He had several stab wounds, internal injuries and a swollen foot.

His index finger was slashed, suggesting his tormentors had tried to make him write something in his own blood. As if things could not be worse, writer Liao Zusheng and his wife, Chen Guoying, concluded that they knew who had killed their son: his teachers.

And they believed they knew why: because of their bitter, public complaints about unauthorised fees and systemic corruption in schools and across Chinese society.

Corruption is an everyday experience for millions of Chinese that taints not just schools but relations in business, on farms and in factories, and potentially any contact citizens have with officialdom.

Foshan appears no more corrupt than any other city in China, specialists say.

It is noteworthy only as an example of a pervasive problem that threatens China's stability and political system. Senior Communist Party officials know that decades of remarkable economic progress are at risk if graft and bribery stretch the chasm between the haves and have-nots too wide.

But they have limited room to manoeuvre.

Any meaningful effort to crack down endangers the party's monopoly on power. The system depends on legions of police, local party and government officials to enforce Beijing's policies and quash dissent.

All too often, critics say, local officials regard their position as a licence to steal. Throughout the country, the economic growth has created a gold rush mentality.

Without both the strictures and the social safety network of Mao Zedong's rigid system, millions of people are seeking ways to prosper - legally or illegally. Corruption in China accounts for an estimated 3% to 15% of a $US7 trillion ($NZ12.1 trillion) economy, and party membership can be an invitation to solicit bribes or cut illegal land deals.

Membership hit 74 million at the end of 2007, a 10% jump from 2002, as moneymaking opportunities increasingly trumped ideology.

Nearly 5000 officials at the county level or above were punished for corruption over the past year, state media reported last week.

"Of course everyone hates corruption," Qiao Zhanxiang, a Beijing lawyer who took on the Ministry of Railways for alleged price gouging and lost, says.

"But everyone also wants to be a part of it."

The result is a growing divide between people who benefit from corruption and their victims.

It is at the grassroots level where this chasm is most harshly felt, among those abused by the system, like Liao and Chen, or others who simply have been left behind.

"Common Chinese people are in hell," said Ai Xiaoming, a documentary film producer and professor at Zhongshan University in the neighbouring city of Guangzhou.

"Hell is not some future. It's right now."

Foshan, or "Buddha Mountain," is the ancestral home of martial arts star Bruce Lee, the place where severe acute respiratory syndrome, or Sars, first was observed, and the source of some of the worst air pollution in the Pearl River delta industrial heartland.

Factories produce ceramics, furniture, toys and household appliances, including items sold by Wal-Mart, Kmart, Avon and Home Depot.

But if you spend time in Foshan, a city of 5.9 million residents and 2.3 million migrant workers, you find it's also a place where bridges and houses collapse; where half-finished skyscrapers sit empty and tilting dangerously.

It is a place where counterfeit currency shows up in ATMs and pay packets.

It is a place where factory workers from inland provinces can be shaken down, beaten - and allegedly sometimes even killed by brutal auxiliary police.

It is a place where a cash-stuffed "red envelope" can ensure that doctors do their best in the operating room, or that you will pass your driving test even if you never leave the parking lot.

In China, it is also unremarkable, said Ren Jianming, vice-director of the Clean Government Research Centre at Beijing's Qinghua University: "What you observed in Foshan can be seen to a certain extent everywhere."

Liao, a former soldier and a longtime Communist Party member, and his wife say officials at Huangqi Middle School turned against them after he spoke out against a $US3900 "selection fee" the school tried to charge without a receipt.

He also posted several essays on the Internet on corruption and waste in China.

Frustrated by what they said was systemic police harassment and stonewalling, including refusal to release their son's autopsy report, Chen and Liao decided to investigate the death themselves.

They said the information they gathered before witnesses were intimidated by police convinced them that the dean of Mengjun's class, two teachers and a guard attacked him that evening two years ago.

It is difficult to verify the parents' account because witnesses often stay quiet for fear of reprisals.

There is no independent police, courts or media.

Foshan's propaganda ministry said Mengjun was caught stealing, attacked his teachers and committed suicide.

Police and the head of a Government team dealing with the case declined to comment.

One of the teachers, Liang Xibo, said he was in his office that day but didn't see or hear anything. But local officials offered the couple large amounts of money to end their quest for justice.

First it was $US20,000. Then $US50,000, if they destroyed all the evidence and stopped talking about the case.

Finally, it rose to $US70,000, several years' income for the family. They also urged Chen (42), and Liao (38) to have a "replacement" child under China's strict one-child policy to "ease their grief".

Liao is not interested.

"It's blood money," he said. But many others decide early on to play the game. Families face unauthorised demands for book, uniform and lunch "fees".

With all sides complicit, most go unchecked, including the pressure to deliver red envelopes, particularly to teachers whose subjects feature prominently on college entrance exams.

"If there are 50 students and 40 give gifts, you definitely don't try very hard with the other 10," said one education industry official, who is also a parent.

"Unfortunately, that's our system."

Tao Jun says he has seen the same process play out in a new arena of wealth and opportunity: private business. Executives say Government and party officials demand payments and abuse their power to award contracts or issue permits.

Companies that under-bribe or otherwise anger officials learn quickly that the most routine inspection can turn into a nightmare.

"Even if you lease a building for 50 years, they can take it back tomorrow," said one Foshan businesswoman, who like others interviewed declined to be identified or discuss details for fear of repercussions.

Although cash is straightforward, executives said gifts of department store and restaurant vouchers are more difficult to trace, as are artwork and stock, paid "study" trips, prostitutes or paying overseas tuition for officials' children.

High tax rates exert further pressure, said Tao, an activist who once worked as a general manager of an Internet company in Foshan.

The company handed out $US140 in bribes each month to avoid $US1400 in taxes, he recalled.

"I know because I signed the vouchers," Tao said.

"It's hard to be a good person in China. The system makes you numb to what's right and wrong."

Companies bribe each other, passing on the cost to customers, and use payoffs to cut corners, accelerate growth or box out competitors.

Occasionally, scandals become public, suggesting how much money is at stake.

In one high-profile case here in recent years, industrialist Feng Mingchang was implicated in a $US1.2 billion loan scandal in which he reportedly bribed 223 bankers and government officials.

He was sentenced to life in prison, and one of his bankers received the death penalty.

But sometimes, business executives can turn the tables on corrupt officials. Lin Ze, a law professor at the Central Party School in Beijing, said businessmen would treat officials to lavish meals, foot massages, saunas and other entertainment, and secretly tape it.

"Then once you don't do things according to their plan, they turn you in."

Villagers say they doubt that much of anything can check the power of their local officials.

In almost any showdown, here or elsewhere in China, police will support local authorities, in part because a riot could weaken the party's political position. "Even if the central Government wanted to see justice carried out at the village level, it is afraid of losing the support of local officials," said Tang Jingling, an activist based in Guangzhou.

"They need them to control society since they're scared to death of any sort of unrest. And to do that, they must let them run their fiefdoms."

In the past, officials have acknowledged that many land protests turn violent.

A survey last year of 90 cities found that 22% to 80% of new land projects were illegal, according to the official New China News Agency. In Lichong, villagers say, the gold rush began in 1988, when officials built seven porcelain factories.

They promised jobs to displaced farmers, but the factories lost money, were stripped of value and sold back to the Government.

As Foshan has expanded, the value of land has skyrocketed.

By law, the proceeds should be distributed among Lichong's 2300 resident-shareholders. The main co-operative project is a complex of apartment buildings as high as 23 storeys near a planned subway stop that will link the area with Guangzhou.

Villagers say their share of the profits was arbitrarily cut to about 35%. Even then, they should be doing well.

But local party officials say the co-operative is almost broke and give them each no more than $US107 a month. Later, it became clear where at least some of the money had gone.

Officials had deposited more than $US1.5 million in a postal bank, pocketing portions of the interest and principal.

The bank allegedly operated a Ponzi scheme that siphoned off as much as $US240 million. Farmers have fought back in several villages.

They say several of their leaders have been beaten and imprisoned on trumped-up charges.

One farmer from nearby Sanshan died in custody. A few continue to work the land among the factories, bulldozers and housing projects. Chen Qixi (38) raises ducks on a few acres of flooded land beneath an elevated highway.

As he tended his flock recently, unemployed villagers looked on.

Chen Rutian (65) said his ancestors had worked this land for 23 generations.

"We've seen emperors come and go," he said. "Now these local officials are driving us off a cliff."

Bare feet, shabby clothing and communal cooking pots sully the marble floors, chandeliers and wood panelling of the five-storey office building in Foshan's Xiantang village. According to Chinese tradition, old age should be a time of respect and security.

But in an act of defiance, dozens of neighbours, most of them elderly, stormed the building in July 2007. Their anger was sparked by a demand that they move their shops from land they collectively own to a private market where they would have to pay rent.

The new market was part of a five-storey condo development on land the village of 3700 people had recently sold to a developer. At the same time, villagers say officials dole out just $8 a month to most residents, an amount that has remained constant since the early 1980s.

"I want to get my money back," said toothless, 91-year-old Cui Neng.

Other protesters guarded 11 boxes of documents bound with tape and locked in a disabled van near a picture of Mao.

The boxes contain evidence, they believe, that officials embezzled more than $US5 million over the past decade. It is illegal for them to examine the documents, they said, so they wait and hope that the central Government will send someone to investigate.

In July, a year after the protest started, village elections were held.

But villagers said the new party leader just bought the position from his predecessor. For months, tattered red protest banners fluttered listlessly outside the village hall.

One read: "Officials should go and collect pig manure if they won't work for the people."

Although the banners have come down, the protest continues.

Some say it is the longest sustained act of civil disobedience in the history of Communist China. - Los Angeles Times-Washington Post


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