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How to Lessen the Political Burden of Economic Reform

February 1, 2012

I will share something not from the bigger political picture or focused specifically on human rights, but something that reflects my way of observing China politically and economically, which is based heavily on social issues.

If you look at China today and not focus on the social issues that everybody— including the Chinese government—is facing, you will miss a lot of things. The Chinese government’ s behavior and the logic of its policymaking are now increasingly focused on and oriented towards social issues inside China.

As an example, I want to share my organization’ s [China Labour Bulletin] process for promoting collective bargaining in China. There was one very interesting incident in September 2010 when the Guangdong government was trying to propose legislation called Guangdong Enterprise Democratic Management Regulations (广东省企业民主管理条例). The regulations included giving workers the right to bargain with their employers, and the right to elect their representatives. There was a big push-back from Hong Kong manufacturer and business associations, which sent huge lobbying groups to Beijing and to Guangdong; eventually, they succeeded. They took out a huge one-page advertisement in Hong Kong’ s Sing Tao Daily, and titled it something like “Against Guangdong government’ s legislation on democratic management. ” So they were worried about giving human rights to the workers. Their ad stated that they had contributed to the country’ s economy for so many years and the government shouldn’t forget that.

Our organization decided to take out our own advertisement, a half page stating that we support the Guangdong government legislation giving workers collective bargaining rights. In that advertisement, we urged Hong Kong manufacturer and business associations to behave more like business associations; that is, they should negotiate with the international buyers on price levels instead of squeezing the workers all the time. If the price goes too low, no factory would be willing to pick up such a contract.1 Doing that would make a business association more like an actual business association, rather than a gang that beats up weaker people.

So that was our little battle, but in the end they won. The Guangdong government withdrew the draft legislation. I think it was already the third draft. So now, one year later, nothing has happened. We are still expecting that some time before the next National People’ s Congress something will happen. I don’t know, nowadays you never know.

I will say this is a very typical case that deals with economics but also involves political rights. Workers’ rights in China should include the right to elect their own representatives and to bargain with their employers. This is a simple livelihood issue but one that also includes the right to collective bargaining and freedom of association—which are political rights. That is, freedom of association only becomes a harsh political issue when the government suppresses it; otherwise, it stays mainly within the economic realm.

Let’ s go back to my first point. I am quite positive when observing China today, that more and more labor rights issues are dealt with as economic, rather than political, matters. Even just five years ago, most major strike organizers would end up in prison. But now, you have these massive strikes, and the organizers are not in prison. Perhaps, if they burned some cars or damaged some machines, they would be detained maybe for a week. Maybe if they seriously damaged something big, that’ s another story. The Chinese government realizes that it is not politically wise to keep beating up workers. The workers don’t claim any political rights in the first place—they just want to deal with their bosses. So this realization is the main reason the Chinese government is becoming more tolerant of protests and being somewhat responsive to worker concerns or demands.

Another important aspect is that Hong Kong businesses actually contributed to these developments quite dramatically by dealing with the Chinese government, by dealing with legislation based on their own interests, and by protecting their own interests. This is normal. They are a part of civil society and have their own associations. They protect their rights. They try to keep more of their profits. That is normal. But it raises another question. If the business associations are strong enough, and if they have money to lobby, and they succeed as they did this time, then that means the government is accepting lobbying. If it accepts lobbyists from one side this time, that means they are on the record as listening to interest groups speaking up for their interests. In China, we have a labor force of, say, around 600 million. Even if only one-third of them start making the point that, hey, the business associations, the business societies, made a strong stance and were able to stop the legislation this time, then, at some point the government has to listen to the labor sector when it starts lobbying harder, which would present great pressure on the government. So I am quite optimistic about the near future. I am not really doing a political analysis of the Chinese government. My point is that it is in the Chinese government’ s own interest to respond to economic and social issues before they become political.

It is time for the government to look for more ways to share the cost of political and social stability. The last thirty years, at least, I would say starting with economic reform in the late 1970s, the government itself has been paying the political price for investments from everywhere around the world, including Hong Kong. The price is a very bad image within China, no matter what it is like internationally. Inside China, the Communist Party of China (CPC) is viewed as representing business, and representing capitalism. I’m not trying to frame this in an ideological way, but this is a fact. I do believe the CPC and the Chinese government recognize, at least to some extent, that this image is not good for maintaining political power and for the Party to still call itself a communist party. So therefore, at some point they will have to ask the businesses to share the burden.

For example, to go back to my original point: if there is a collective bargaining system, there would be no need for the government to use any political force or other kind of coercion to force employers to pay more to the workers and make the workers happier in order to have less political and social unrest. Instead, there needs to be a system giving workers the right to bargain and elect their representatives, and that obligates employers to bargain and respond to workers’ requests. If a democratic system or a system with very fundamental democratic values and democratic standards were set up, then there is no need for the government to step in. Workers and employers will deal with each other directly and if the workers are successful, at some level, in asking for higher wages, and, in the end, both sides come to a compromise, then the workers will make more and will be happier. So the government, by just standing in the middle, gains political credit.

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