Civil Society and Limited Government

CIVIL SOCIETY AND LIMITED GOVERNMENT

-- TAKE THE CHINESE CHAMBERS OF COMMERCE

FOR EXAMPLE

Dr. Liu Junning

I. Chamber of Commerce and Civil Society

II. Interaction between Chamber of Commerce and Government

1. Effect of Government on Chamber of Commerce

2. Effect of Chamber of Commerce on Government

III. Chamber of Commerce and Governance

1. Complaint and Articulation of Interests

2. Making Interest Demands

3. Communication and Dialogue

4. Participation in Legislation and Policy-Making

5. Self-Development

6. Increasing Transparency

7. Rule of Law and Peaceful Settlement of Conflicts

8. Charity and Public Welfare

IV. Preliminary Conclusion

In modern society, governance in any sense is under the market economy. First of all, it is interaction between the government and the market society. The rise of modern civil society is closely related to the market economy. There is no civil society in a strict sense in a self-sufficient natural economy and under the economic structure in which all economic activities are controlled according to government orders. So civil society and government governance are inseparable from commercial activities and the corresponding free and voluntary association under the market economy. All constitutions in modern society recognize people’s freedom of association. There will not be civil society without freedom of association. Therefore, investigation of the status of the chambers of commerce in all localities in Chinese society and their influence on government governance at the current stage should constitute an indispensable link in study of the relationship between China’s civil society and governance. For this reason, I choose the “chambers of commerce” in present-day China as the object of case study. The purpose of research is to observe, through the case study of the federation of industry and commerce, how the civil social organizations which emerge in the process of the reform designed to establish the market economy in China play a unique role in the establishment of limited government in China which is compatible with the market economy and democratic politics.

The research is designed to discuss the revival of the chambers of commerce in present-day China and the motive force for their development, study their status in China’s civil society, discover the basic factors for promoting or impeding the revival of the chambers of commerce as a major civil social organization in China and the impact of the growing chambers of commerce on government governance and assess the impact. The so-called governance refers to the methods, behaviors and process of the government’s management of public affairs. In the research, governance refers to the method of exercising public rights in the process of management of economic and social resources of a state for the purpose of achieving economic growth.

I. Chamber of Commerce and Civil Society

The official name of China’s chamber of commerce is the All-China Federation of Industry and Commerce. According to official determination of its status, it is a mass organization for the industrial and commercial circles throughout the country, the civil chamber of commerce for internal and external ties, a national organization for local federations of industry and commerce at all levels, a component of the united front and a member unit of the Chinese People’s Political Consultative Conference.

The All-China Federation of Industry and Commerce was established in 1953. But the task entrusted to it at that time was not to promote the development of industry and commerce and private economic sector, but to eliminate private economic sector in coordination with the Communist Party of China (CPC) and governments at all levels under the leadership of the CPC, complete the socialist transformation of capitalist industry and commerce and conduct socialist education and ideological remolding among private industrialists and businessmen. After the planned economy, public ownership, proletarian dictatorship and regime were established and private enterprises and economic sector disappeared, the All-China Federation of Industry and Commerce and its local organizations at all levels which represented the interests of private enterprises and economic sector lost the value and the social, political and economic basis for its existence. For 20 years from 1959 to 1979, the All-China Federation of Industry and Commerce and its local organizations at all levels which served as the Chinese chambers of commerce ceased almost all the activities and existed in name only. The Sixth National Conference of the All-China Federation of Industry and Commerce held in November 1988 decided that the organization is the civil chamber of commerce for internal and external ties and stipulated that it is a united front organization. The object of the case study is the All-China Federation of Industry and Commerce (also called the National General Chamber of Commerce in the article) and its local organizations: local federations of industry and commerce (also called local general chambers of commerce).

The principal members of the Chinese chambers of commerce are private enterprises and entrepreneurs in all localities. Unlike cultural organizations, organizations for social movements and the promotion of civil rights and other civil social organizations, the Chinese chambers of commerce are professional service organizations. As China’s politics and economy undergo a transition, the status of the chambers of commerce is at a stage of the transition. The following is the determination of the status of a provincial chamber of commerce. This determination of the status reflects the nature of the chamber of commerce which is undergoing a change. “The (Hainan) General Chamber of Commerce should be fully aware that it has greater advantages than other organizations of industry and commerce. As the federation of industry and commerce, it was an important component of the Party’s united front. It is gradually civilian-run and moves towards civil self-governance, but it is still and will be a component of the united front. This requires that on the one hand, it should consolidate its status in the people’s political consultative conference and use the forum of the people’s political consultative conference to participate in the deliberation and administration of state affairs on behalf of the industrial and commercial enterprises and that one the other hand, it should utilize the group advantages to adapt to the new situation and ensure that the chamber of commerce is a part of the united front, represents the economic sector and is civil, so as to promote the reform. At the same time, it should keep to leadership by the Party throughout the process of reform and construction. Only by keeping to leadership by the Party and concentrating firmly on the central task of economic development will the chamber of commerce certainly make progress in its improvement and various reforms.”[1] From this we can see that on the one hand, the chamber of commerce should free itself from the original status as the tool of the united front and be civilian-run and independent and that on the other hand, it must continue to accept leadership by the Party and meet the needs of the united front.

Because regional development in China is uneven, there are great differences in the development and activity of the chambers of commerce in different areas. Chambers of commerce in economically developed southeastern coastal areas are usually better than those in backward areas in terms of their development, independence, sound organization and impact on social and economic activities. Chambers of commerce in economically developed areas have stronger wishes for self-development than those in backward areas. For example, Hainan Provincial General Chamber of Commerce has put forward a new way of thinking for its self-development, that is, if the general chamber of commerce “develops, it must improve the central link of the provincial general chamber of commerce, be based on grass-roots chambers of commerce, trade councils and professional associations and become a civil, self-disciplined system of social intermediate service organizations. We should further establish the authority of the provincial general chamber of commerce. The chambers of commerce should make a shift from being loosely organized to being well-organized, from independent operations to combined operations and from decentralized activities within their system to the network coordinated activities under unified command, so as to pool efforts and enhance the cohesiveness within their system.”[2] This way of thinking shows that Hainan Provincial General Chamber of Commerce ardently hopes for self-development. It is hard to find the way of thinking for development from the chambers of commerce in backward areas. Another index for proving this point is that chambers of commerce in backward areas seldom set up their web sites in Internet. But chambers of commerce in economically developed areas set up their web sites in Internet.

As a reviving civil social organization and especially an organization for private enterprises in a socialist country, the chamber of commerce in China is of special significance. The revival of the chamber of commerce gives new impetus to the development of the market economy. As a result, the relationship between enterprises and the government begins to undergo a change, and private enterprises begin to expand considerably. On the one hand, the emergence of private enterprises and the chambers of commerce requires that existing political system tolerates them. On the other hand, they pose a direct challenge to the method of governance under the old planned economy. From this we can see that the local chambers of commerce which serve as the federations of private enterprises are the backbone of the civil society and that they are the most representative external factor which can result in a change in governance.

With regard to the nature, objectives and functions of the Chinese chambers of commerce, we can find some clues from the rules of the chambers of commerce at all levels. For example, the Rules of Hainan Provincial General Chamber of Commerce make the following stipulations.[3] With regard to its nature, the chamber of commerce is “a mass organization under the leadership of Hainan provincial Party committee and provincial government, a federation of civil chambers of commerce which are voluntarily organized by industrial and commercial enterprises, groups and individuals in Hainan Province and an affiliated organization of the All-China Federation of Industry and Commerce”. (See Article 3 of the Rules). With regard to its objectives, “all the activities of the chamber of commerce conform to the Constitution of the People’s Republic of China which serves as cardinal principles and the various laws, statutes and regulations promulgated by the state and Hainan Province and are designed to unite with industrial and commercial circles, safeguard the legitimate rights and interests of its members and serve social stability, reform, opening to the outside world and economic prosperity in Hainan Province, socialism with Chinese characteristics and the reunification of the motherland.” (Article 4 of the Rules). With regard to its functions, the chamber of commerce has the duty to “carry out the Party’s basic line, help its members conscientiously study and observe the state policies and laws, help and educate them to love the motherland, devote themselves to their work, abide by the law and perform their due social responsibilities. It safeguards the legitimate rights and interests of its members, checks their complaints and reports their opinions, requests and suggestions to the competent government functional departments.” (See Article 5, Sections 1 and 2 of the Rules).

We can also review the provisions of the Rules of the All-China Federation of Industry and Commerce adopted in November 1997.[4] According to the Rules, its nature is that “the All-China Federation of Industry and Commerce is a mass organization and civil chamber of commerce which is organized by the Chinese industrial and commercial circles under the leadership of the Communist Party of China, a link and bond between the Party and the government on the one hand and figures from non-public sectors of the economy and an assistant for helping the government manage non-public sectors of the economy.” (Article 1 of the Rules) Its objectives are “to hold high the great banner of Deng Xiaoping Theory, to adhere to the Party’s basic line and program for the primary stage of socialism, the basic economic system which takes the public sector as the dominant part and makes the economy with diverse forms of ownership coexist and the basic principle of one country, two systems, to persist in uniting with, educating, guiding and serving its members, to promote the sound development of non-public sectors of the economy and to make contributions to the promotion of socialist material progress and ideological and cultural progress, reform and opening to the outside world, the reunification of the motherland and the rejuvenation of the Chinese nation.” (Article 3 of the Rules) Its major tasks and functions are “to participate in political consultation about the fundamental state policies and major issues concerning politics, economy and social activities, play the role of democratic supervision and participate in the deliberation and administration of state affairs; to help its members take an active part in national economic development, promote the gradual improvement of a socialist market economy and bring about all-round social progress; to recommend representative figures from industrial and commercial circles for political appointments; to carry forward the fine tradition of self-education, publicize and carry out the principles and policies of the Party and the state and strengthen and improve ideological and political work; to advocate love for the motherland, devotion to work, the need to abide by the law, raise the quality of its members and train the contingent of activists.” (See Article 4, Sections 1 to 4 of the Rules)