: New: Book Report: The Party

If you're an American and you read this primer on China's Leadership Transition, you might be surprised that it says that party leadership and army leadership are more important than government leadership. The party? Yeah, the party. It's a big deal. I recently read The Party by Richard McGregor and I learned a lot about the CCP (China Communist Party) from it.

I live in the USA. Every so often my government does something wrong and various USA-ans chatter at each other: how can this happen? Surely a government can't act against the will of the people this way. But China shows us that it can happen. People put up with a lot. Sometimes it works out OK. In 1998, China's banks made a bunch of unrecoverable loans. "Unrecoverable loans" probably sounds familiar to USA folks today. But instead of just bailing out the banks, the Party brought them under central government control.

But the CCP gets weird. Most big companies in China aren't independent; they're under control of the Party. If CEOs in some industry get too big for their britches, the Party rotates those CEOs between companies. That larns those executives who's really in charge. Makes you wonder why those CEOs are motivated to do a good job, though.

And often things go very, very wrong. The CCP might be the Chinese People's greatest enemy right now.

This book gives a pretty good survey of the wide-scale corruption. E.g., an important first step to purging the corrupt government of Shanghai was promising to keep quiet the arrangements between those Shangai officials and former premier Jiang Zemin. Many people knew about these arrangements; everybody knew better than to talk about them. Taiwan, real estate scandals, milk powder poisonings, ...

There's some interesting insight (at least it was new to me). Reading the news, I think of corrupt local officials as a big problem in China. But this book points out that they're also helpful: the national government hands down nationwide edicts which perhaps don't make sense for some area or other. Sometimes the local officials are wise to ignore these nonsensical rules. Part of the reason that China has succeeded in business is that locales compete for business. Sometimes they cut corners to do so. If those corners are useless bureaucracy, then great; when they lead to poisonings... not great.

Tags: book china

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