Growth of Capitalism Meant Growth of Corruption for Chinese : China: The Communist Party was first known for its honesty and integrity. But now it stands as one of the world’s most corrupt political machines.

The Communist Party of China, with more than 50 million members, is the largest political machine in the world. It is also one of the most corrupt. While the post-Mao regime periodically announces “clean government” drives, party bureaucrats plunder the nation’s economy through what amounts to a huge political-protection racket.

Indeed, among Chinese who remember before the revolution, it has become common to debate which is more corrupt, Chiang Kai-shek’s Kuomintang at the time of its collapse or Deng Xiaoping’s Communist Party today. The choice is difficult, even though the pervasive corruption of Chiang’s Nationalist army and bureaucracy is cited as a main reason for the Communist victory in 1949.

As China’s octogenarian leaders celebrate the 70th anniversary of the Chinese Communist Party this month, they will not dwell on the complex web of corruption the party has woven around Chinese society--save, perhaps, to blame those aspects of the malady they do acknowledge on persistence of “feudal” customs and baneful Western influences. Rather, they will celebrate the party’s heroic past. They will recall July, 1921, when 13 young Chinese secretly met in Shanghai to convene the first CCP Congress.

It will be noted that Mao Tse-Tung was a delegate. It will be even more pointedly noted that Deng Xiaoping joined soon after--in 1923, at age 19. Much will be said and written about how the nascent party was caught up in one of the most massive and militant social revolutionary movements of the 20th Century. How the party organized millions of peasants and intellectuals in a war of resistance against invading Japanese; how it triumphed, against overwhelming odds, over the forces of Chiang Kai-shek in a civil war that took the unprecedented form of the revolutionary countryside “surrounding and overwhelming” conservative cities.

Although embellished and romanticized, there will be little untruthful about the history related. There is no need to lie. For the history of the Chinese Communist Party during the revolutionary era is heroic. Before 1949, few who joined the Communists did so out of self-interest. Chances of survival were small and prospects for success slim. For the most part, the party attracted courageous and idealistic people. Their story was one of self-sacrifice, martyrdom and bravery.

How then did a party that built so much of its reputation on the honesty of its members and the integrity of its institutions degenerate to the point where it is now compared with its KMT predecessor--the archetypal example of bureaucratic corruption?

To be sure, with the victory of 1949, the Communist Party underwent a profound change. Revolutionaries who became rulers wished to enjoy the fruits of victory. The Communist Party was transformed from a revolutionary organization into a state Establishment that attracted careerists and opportunists as well as revolutionary idealists. Joining the party after 1949 was neither heroic nor dangerous--just the first step on the ladder of success in the new society.

These and other common post-revolutionary phenomena contributed to the party’s moral decline after 1949. There was increased use of official position for private ends, ever greater differentials in material rewards based on one’s place in the political hierarchy and the growth of corruption in a party that controlled economic as well as political life.

Problems were apparent soon after the founding of the new regime. By 1957, Mao complained, “Some cadres now scramble for fame and fortune and are interested only in personal gain.” His complaints became ever harsher as bureaucratic greed--and the number of bureaucrats--grew. But to little avail.

What transformed the scope and nature of China’s bureaucratic corruption were the much-celebrated market-type “reforms” introduced by Deng after 1978. It was soon apparent to China’s bureaucrats--or at least to the more astute and avaricious--that they were in a uniquely favorable position to profit from the new market mechanisms. In lieu of an existing capitalist class, party and state officials hastened to fill the socioeconomic void.

Opportunities Communist Party bureaucrats exploited included the rapid expansion of free markets, decollectivization of agriculture, encouragement of private enterprise, a vast expansion of foreign trade, an influx of foreign capital through loans and investments, and various forms of decentralization. These measures, whatever their initial economic efficacy, combined to breed corruption in epidemic proportions and to transform Communist bureaucrats into capitalist-type entrepreneurs.

Ranking Communist officials--including Deng and former party chief Zhao Ziyang--used political influence to set up relatives and friends in lucrative private businesses. Economic bureaucrats profited by buying scarce commodities with public funds at low state prices and selling them on the free market at far higher prices. Officials acquire low-interest loans from the state for ostensibly public purposes and privately reinvest the money at high rates. Government agencies, even army and secret police units, have formed “joint ventures” with foreign capitalists to build luxury hotels.

Such are some results of the marriage of the market to an entrenched bureaucratic apparatus, the heart of which is the Communist Party of China. Graft, bribery and “backdoor” deals are only minor aspects of the bureaucratic capitalism stifling Chinese society. It is a politico-economic monstrosity that blurs distinctions between illegal activities and private entrepreneurship. The line between bureaucratic privilege and official profiteering has all but vanished.

More than any other issue, it was public revulsion against corruption that brought together students, workers and ordinary citizens in the massive Democracy Movement of 1989. In the two years since the bloody suppression of the uprising, little has changed, save that the system of organized economic corruption is now enforced by harsher political methods. Both the enforcer and the major beneficiary is the Chinese Communist Party. Now, on its 70th anniversary, few have reason to remember it was once an organization that justly prided itself on forging an egalitarian tradition of “plain living and hard work.”