28 January

the party organizer

By Richard McGregor

Published: September 30 2009 22:23 | Last updated: September 30 2009 22:23

In line: Chinese leaders at the National People’s Congress

About a kilometre west of Tiananmen Square and the compound housing China’s top leaders in central Beijing stands a large unmarked building. No sign hangs at the entrance to indicate the business conducted inside. The occupant’s phone number is unlisted; calls from the building do not display an incoming number identifying their origin, just a string of zeros.

As the Communist party on Thursday marks 60 years in power, however, the occupants of the office complex will be quietly celebrating as well. Little known even within China, the body based there and known as Zhongzubu – the Central Organisation Department – has emerged from the country’s economic upheaval of the past three decades as indispensable to the party’s hold on power.

Below: Trade in state posts

China’s embrace of the market since the late 1970s has driven a surge in economic growth and a social revolution. Chinese citizens are in many respects freer and richer than they ever have been under communism, able to work where they want, travel overseas and buy homes and cars. But while easing controls over aspects of the economy and society, the party has worked to ensure it maintains its grip on other levers of power.

Li Yuanchao

The party still directly controls the armed forces and the media. The Central Organisation Department is its third and least-known pillar of power and the key to its hold over personnel throughout every level of government and industry. Far from undermining the department’s position, the freedoms unleashed by the market economy have made personnel control more essential than ever in fending off rivals for power. The ability to vet government staff for their loyalty to the leadership, senior officials believe, is also essential to the party’s grip on power into the future.

The department has been headed since late 2007 by Li Yuanchao, one of the more open-minded figures of the new generation of Chinese leaders. Mr Li studied briefly at the Kennedy School of Government at Harvard University and has been at the forefront of moves to cultivate ideas to modernise the party. His day-to-day duties at the department, however, are decidedly old-fashioned.

The department replicates what was known in the Soviet Union as the nomenklatura, the “list of names” of party members who formed the Communist ruling class through their eligibility to fill prized jobs in any sectors the state controlled. “The system is all from the Soviet Union but the CCP has taken it to an extreme,” says Yuan Weishi, of Sun Yat-sen University in Guangdong. “China is more radical. [The party here] wants to lead everything.”

To glean a sense of the dimensions of the organisation department’s job, conjure up a parallel body in Washington. The imaginary department would oversee the appointments of US state governors and their deputies; the mayors of big cities; heads of federal regulatory agencies; the chief executives of General Electric, ExxonMobil, Walmart and 50-odd of the remaining largest companies; justices on the Supreme Court; the editors of The New York Times, The Wall Street Journal and The Washington Post, the bosses of the television networks and cable stations, the presidents of Yale and Harvard and other big universities and the heads of think-tanks such as the Brookings Institution and the Heritage Foundation.

All equivalent positions in China are filled by people appointed by the party through the organisation department. With a few largely symbolic exceptions, the people who fill these jobs are also party members. Not only that, the vetting process takes place behind closed doors and appointments are announced without any explanation about why they have been made. When the department knocks back candidates for promotion, it does so in secret as well.

The organisation department’s Beijing headquarters

The patronage dispensed through the department, in the form of the most powerful party and government positions in the country, has turned it into a forum for the system’s toughest internal political battles. Politburo members, factional groupings, the centre and the provinces, and individuals aligned to different ministries and industries all struggle to place their people into positions of influence in state institutions.

“If the job of a bureau chief becomes vacant, then a lot of senior officials in Beijing will want to have it filled with their person. In times like this, the organisation department will have a very difficult task,” says Wu Si, the editor of Annals of the Yellow Emperor, a prominent liberal magazine. “It is meant to be about virtue and talent but it becomes a test of your relationship with the department and the seniority of your patron. At the end of the day, the department cannot be bypassed.”

In the absence of elections or any overt competition for government posts, the behind-the-scenes battles to secure appointments are the very stuff of politics in China. As the clearing house for these disputes, the organisation department has become not only the institutional hub of the entire political system but also the battleground over reforms crucial to the party’s modernisation.

It is beset by constant competing tensions. The Politburo has striven to professionalise the selection of top officials, while at the same time undermining the process by fixing appointments in favour of loyalists and relatives. Officials presiding over local fiefdoms have swept aside the rules even more crudely, establishing markets in which government positions are bought and sold for gain.

Outwardly, the organisation department is these days very different from the body established by Mao Zedong in the 1930s. Rules for appointments are codified in more than 70 articles that read much like legislation. Promotions are tied to length of service, education levels and mandatory classes at a party school every five years.

Officials holding posts such as governor or mayor are rated according to a lengthy list of numerical indicators that look like they were drawn up by management consultants. Economic growth, investment, the quality of the air and water in their localities and public order all theoretically count in the performance metric.

The department has developed all the trappings of a sophisticated multinational headhunter, using psychological tests, lie detectors and confidential interviews with colleagues of officials up for promotion. For modernisers in the party, the benchmarks are essential to elevate the standard of government administration and keep corruption to a minimum.

But the regulations contain loopholes. Officials judged to be “exceptionally talented young cadres”, for example, can be promoted regardless of seniority. “It all depends on whether you get noticed at the end of the day,” says an adviser to the department. “There is no scientific system. Nearly everyone gets the same points in all of these elaborate assessments anyway, because for you not to do so would reflect badly on your superior.”

Senior leaders have long held sway over jobs in select ministries and industrial sectors. Li Peng, the former premier, was the longtime ruler of the power sector, where two of his children rose to hold powerful jobs. Zhu Rongji, another former premier, oversaw the finance sector, allowing him to appoint the heads of large financial institutions and make his son the highly paid head of China International Capital Corporation, the country’s largest investment bank.

Jiang Zemin, the former party chief, reigned over the technology sector, brushing aside professionals in the organisation department to usher loyalists into top jobs and his son into important positions within the sector in Shanghai. More recently, Politburo members in charge of the law and state security have been influential in senior energy appointments.

The party’s most effective tool in elevating competence over cronyism over the last decade has been a resolutely old-fashioned one. The department stress-tests promising officials by rotating them through jobs in diverse parts of the country and in different administrative units, before hauling them back to Beijing into the big league if they pass muster.

By the time Chen Deming was tapped to be commerce minister in 2007, for example – a post that put him in charge of trade policy and negotiations and foreign investment policy – he had already served in three distinct positions.

In Suzhou, as mayor and party secretary, Mr Chen helped build the city in the Yangtze delta near Shanghai into one of China’s most advanced manufacturing hubs, winning kudos on the ground by standing up for local interests even when it embarrassed Beijing.

After Suzhou, Mr Chen was dispatched to Shaanxi, where his reputation survived. Finally, he was put in charge of the sensitive energy portfolio in Beijing before being promoted to take charge of trade.

Carlos Gutierrez, his counterpart in the administration of George W. Bush, met Mr Chen in 2007 and remarked how impressed he was by his grasp of his portfolio after a short period in the job. Mr Chen’s career path, said Mr Gutierrez, reminded him of the rigours that successful multinationals put their up-and-coming executives through, sending them first out into the field to difficult regional offices and underperforming divisions before bringing them back into head office to see how they performed there.

The organisation department has been gradually lifting the secrecy that surrounds its operations. Old habits die hard, however. This year it appointed a spokesman but has yet to identify him or her. In spite of requests, the department did not grant an interview for this article.

The only way a member of the public can make contact with the department in Beijing is through its sole listed number, 12380, which has a recorded message, or a website allowing the caller to report any “organisational” problems.

Friends of Mr Li once joked that they wanted to ask him as latest head of the department about what they considered to be the absurd level of secrecy that surrounds it. “Are we still an underground party?” exclaimed one of his longtime friends, before admitting he could talk to Mr Li about anything – except his work.

Trade in state posts

When the mayor of Shenzhen, the commercial city bordering Hong Kong, was sacked in June for alleged corruption, much about the case was familiar. Xu Zongheng remains under investigation for claims he took bribes in return for approving construction projects, standard fare for graft indictments in China.

But another allegation against Mr Xu was more worrying for the central government’s corruption fighters – that he had purchased his job as head of one of China’s richest cities. Buying and selling official positions is commonplace in local governments in China but little known for posts as senior as that of mayor.

Xu Zongheng

In small localities, the most popular positions up for sale are those of party secretary and head of the local organisation department. Both jobs carry enormous discretionary powers and the ability to bestow patronage on individuals under them in return for cash.

The bribery, corruption, treachery and sheer desperate self-interest that characterise the practice are detailed in frank internal documents written by the organisation department in Jilin province. The documents, obtained by the Financial Times, depict the competition for promotions as the “four running races” that subvert the department’s rules.

In “sprints”, officials opportunistically grab chances at the moment of leadership reshuffles to lobby superiors for promotions. In the “long-distance” races, they “suck up to leaders through all means, and make emotional investments, like providing hospitality, gifts and help to solve problems” of their bosses.

The “relay” race requires drumming up “multi-layered recommendation from relatives, friends, classmates and people from the same local area” to get close to leaders. In the “hurdles”, officials go over the heads of their immediate bosses, often using retired Communist party cadres to put pressure on the organisation department on their behalf.

“The older senior officials who survived wartime were different from the younger officials who tend to think about themselves and are mainly after power, salary, status, housing and medical care,” Zhang Quanjing, head of the department for five years until 1999, has told local media. “This thinking triggers jealousy and encourages the buying of official posts to get promoted.”

The market’s value was shown by a case in Sichuan in 2007, when a man passing himself off as an organisation department official secured a payment of $63,000 from a local bureaucrat under the guise of finding him a government post.

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