Operation Fox-hunt

Beijing's unofficial fight against Party corruption

When most people think of China today, they think of a society which has become dramatically more prosperous in the space of 40+ years, bringing a much higher standard of living to more than 500M people. Obviously, this is a good thing, isn't it?

In fact, the story is not nearly that simple. Yes, a higher standard of living and good education are important and more opportunities are all pluses, but such dramatic change also created externalities for the society and for the government.

In China, the situation is compounded by the fact that government is dominated by one ruling party, the Chinese Communist Party, ruling over a population of 1.4B. Almost all senior positions are held by Party members, an organization which has 90M members, and whose system of governance is largely opaque to non-party members. Power and authority flow to the top, with almost all important decisions being made by the Central Committee and General Secretary.

For the Party, the biggest externality which affected its governance was the potential for corruption. Before China's reform and opening up in 1979, the scale of corruption was very small because everyone was poor. As it opened up, capital flowed into the country to make business investments and to develop real estate. In order to make these investments, government officials, all of whom were Party officials, had to give their approval on development projects. Within the government and Party organization, these officials were judged according to how many new projects they could attract to their town, city, province and region. The more projects they could attract, the better they were performing. In the early days of reform, all the incentives were skewed for the officials to approve as many projects as they could: foreign investors going into China wanted to invest in projects, and the Party leadership wanted more investments.

This set the stage for corruption where foreign investors could get faster approval for their investments if they gave "gifts" to the officials. The "gifts" became extravagant quickly. Soon, corrupt officials were selling their approval for projects. This led to government officials granting approval to all kinds of projects, including many projects which were bad for the environment, creating general unhappiness among the public. Many officials built lavish homes, had large numbers of mistresses, and were driven in expensive automobiles while dining at expensive restaurants with businessmen and investors. There was no way a government official with an official salary of approximately US$20k could live that way without being corrupt.

For the Party leadership, the writing was on the wall: even though China had become more prosperous, many Chinese were losing their confidence and trust in the Party. When the PRC was founded in 1949, the Party had won the trust of many Chinese by stating that they were not corrupt like the Nationalists (KMT) were under Chiang Kai-shek. Reform had brought a higher standard of living, but now many Party officials were just as corrupt, if not more corrupt than the Nationalists had ever been. If the scale of this corruption continued, wouldn't this lead to the undermining of the Party's own legitimacy? Eventually, would this not lead to the erosion and downfall of the People's Republic, just as corruption had seriously weakened China's previous imperial dynasties?

The situation came to a head around 2008, following the Beijing Olympics. The special challenge was that the corruption came from within the Party ranks. Under the Chinese system of government, there is no independent judiciary which appoints an independent investigator to prosecute. The corruption had permeated the system at all levels. It was like a cancer where the patient had to find the cancer, prescribe treatment, and undergo his own treatment according to his own plan. 

The solution which the Party leadership settled on was for the Party to appoint trusted investigatory officials to go after corrupt officials, extract confessions from the officials, and after they confessed, expel them from the Party where they would face criminal charges in the courts and then be sentenced.

The name of this fight against corruption was Operation Fox-hunt 猎狐行动。Operation Fox-hunt has operated largely in a black box; party members don't know if they are being investigated until they receive a notification called 双规 in Chinese. The notice was very simple: "Appear at this place on this date to answer questions." Some officials would commit suicide rather than appear; this way they could protect their ill-gotten gains. 

When the campaign started, the Party General Secretary was Hu Jintao. In 2013, Xi Jinping became Party General Secretary; he made the fight against corruption his main platform when his term began. Among many Chinese, Xi's popularity is based on his unrelenting fight against corruption. In his public statements, Xi has made it clear that the fight against corruption is not a short-term campaign; it is a feature of Party rule which should continue unabated. 

Many western observers have stated that they believe that Xi has used the anti-corruption campaign to oust his political foes; an early victim was his main challenger for Party General Secretary, Bo Xilai, who was jailed for life for corruption. This claim is speculative; it is not clear. As for Xi personally, he has been outspoken in criticizing waste, especially food waste, and he does not seem to have a lavish personal lifestyle.

If you are interested in learning more about Operation Fox-hunt, and how the Party's fight against corruption has evolved, and how white-collar crime has developed, please leave a comment.

Next week: Chinese Crime will feature an interview with author Qiu Xiaolong, who has written the popular and award-winning English-language Inspector Chen detective series, which are set in contemporary Shanghai.