Institutions of the Party-State

1
Institutions of the Party-State

• Major debate about the capacity of the Chinese
  state
• Where does Pei Minxin stand?
• Alternative argument Yang Dali

2
Institutions of the Party-State

• Major debate about the capacity of the Chinese
  state
• Where does Pei Minxin stand?
• Alternative argument Yang Dali
• China has made significant institutional reforms
  to improve governance
• Critique strong on policy weak on
  implementation
• Remaking the Chinese Leviathan
• Now lets look at some empirical evidence to
  assess the relative merits of each side in the
  debate.

3
Institutions of the party-state

• Fiscal Policy Background1994 tax and fiscal
  reforms
• Established National Tax Service (collects
  central and shared taxes under Tax Sharing
  System) historic!
• Budgetary revenue as share of GDP
• 1994 10.8 percent
• 2005 17.3 percent
• Centralized control over fiscal revenue
• Centers share of budgetary revenue
• 1993 22 percent
• Since 1994 gt 50 percent
• Continued decentralized expenditure
  responsibility
• ? Revenue squeeze on local governments

4
Central provincial shares of total revenue and
expenditures ()

• 1993 2003
• Revenue 35 66 (31)
• Expenditure 45 49 ( 4)
• Source Wong 2006

5
Fiscal Policy Background

• Further centralized control over fiscal revenue
• 2002 reassigned corporate and individual income
  taxes from local to shared category with center
  taking 60 percent
• Abolished agriculture taxes
• ? burdensome on low-income farmers
• After 2002
• No Ag Special Products Tax
• No Slaughter Tax
• After 2004
• No Agriculture Tax

6
Fiscal Policy Background
6

• Why is central fiscal capacity important?
• Is Dali Yangs optimism justified?
• p.44

7
Institutions of the party-state

• Implications of fiscal policy fiscal gap
• 40-45 percent covered by local and shared taxes
• 40-50 percent of fiscal needs covered by
  intergovernmental fiscal transfers
• 5-10 percent of fiscal needs unmet (Wang Yongjun
  estimate 2006).
• High degree of dependence on fiscal transfers
• Central gov. sends resources to poorer areas
• Reliance on off-budget funds and local gov. debt
• Exacerbated by political pressures
• Tenure, promotion criteria

8
Institutions of the party-state

• Using law to govern (Dali Yangs argument)
• Under Mao, used ideology more than law
• During reform era, new role for law
• Bring regularity to government operations
• Indicate policy direction
• Supervise/regulate functioning of state agencies
• Key institutions for ruling by law
• Peoples Congresses
• Courts

9
Institutions of the party-state

• Hierarchy of authoritative documents
• Enactments with the formal status of law
• in the sense of being enforceable by courts
• Constitution xianfa ??
• National Peoples Congress Standing Committee ?
  statutes/laws falü ??
• State Council ?
• administrative regulations xingzheng fagui
  ????
• Provincial-level peoples congresses ?
• local regulations difangxing fagui ?????

10
Institutions of the party-state

• Problems with the hierarchy of authoritative
  docs
• No good system for authoritatively resolving
  conflicts between different rules
• Technically,
• Constitution
• Law on Legislation
• National Peoples Congress Standing Committee
• May review and invalidate legislation passed by
  lower-level bodies
• NPC not known to have overturned a single
  administrative or local regulation (Chen 2004114)

11
Institutions of the party-state

• Problems with the hierarchy of authoritative
  docs
• Courts
• Not allowed to play role of resolving conflicts
  of law/rules
• Not allowed to invalidate legislation
• Can only either appeal to higher legislative body
  or apply lower-level rule
• Regulations passed by lower-level governments
  often trump superior regulations
• In practice, local governments dominate
• Administrative Litigation Law
• In principle, citizens can sue in court to force
  governments to follow only laws already on the
  books ? land ex.

12
Institutions of the party-state

• Courts beholden to local party-state
• No tenure for judges
• Local government controls funding
• Local party committee and party political-legal
  committee (?????)
• Have influence over
• Court personnel
• (technically Peoples Congress authority over
  personnel)
• Acceptance of cases
• Handling of cases

13
Chen Guangcheng, blind lawyer

• Sought to enforce 2002 Population and Family
  Planning Law
• Family planning shall be practiced chiefly by
  means of contraception Article 19
• informed choice
• Led lawsuit by rural residents of Linyi against
  local government practices
• Sterilization
• Forced abortion

14
Chen Guangcheng, blind lawyer

• Beijing University Law Professor, Zhan Zhongle,
  who helped draft the 2002 Population and Family
  Planning Law re Chens challenge
• By suing the government, Linyi peasants are
  merely asserting their legal rights. Whether the
  courts accept the case, and how they handle it,
  will be a test of Chinas Justice system and of
  whether China can govern according to law.
• (Source Washington Post, 8/27/05)

15
Institutions of the party-state

• Local Peoples Congresses
• In principle, new supervisory role over local
  governments (Dali Yang, p. 49)
• Must approve work report of government
• Must appraise local officials performance
• Must approve local government budget
• In practice, very limited
• Lack authority to actually punish local
  governments
• Only party performance appraisal matters
• Party group steers Peoples Congress Standing
  Committee
• PC lacks adequate data or staff to meaningfully
  supervise budget

16
Institutions of the party-state

• Local Peoples Congresses
• Examples of real attempts at supervision
• (reflects what PC deputies hear from local
  citizens)
• Hubei, Shiyan PC vetoed work report of government
  to highlight misappropriation of poverty relief
  funds
• Hubei, Wuhan PC vetoed work report of government
  to highlight poor implementation of employment
  re-training project for laid-off workers
• What really happens
• Governments ignore
• PC signal sent to higher level party apparatusit
  then can choose whether to take action

17
Institutions of the party-state

• Questions for discussion
• To whom are local cadres accountable?
• What aspects of the system promote effective
  policy implementation?
• What are the structural obstacles to effective
  governance?

18
Questions for discussion

• Why has the passage of significant environmental
  legislation and the building of an extensive
  environmental regulatory framework not led to
  improved policy implementation or reduced
  environmental degradation?