Globalization, Path Dependency and the Limits of Law: Administrative Law Reform and Rule of Law in the People's Republic of China

Globalization, Path Dependency and the Limits of Law: Administrative Law Reform and Rule of Law in the People's Republic of China By Randall Peerenboom* The People's Republic of China ("PRC") has spent the last twenty years rebuilding its legal system and creating a modem administrative law regime as part of its efforts to adapt to the needs of a market economy and a political system that is moving away from its totalitarian past toward a new form of polity. To what extent has the process been a response to or shaped by the forces of globalization, including China's increasing integration into the global economy? Is China's administrative law system converging on the best practices of administrative systems elsewhere, or will the path-dependent nature of reforms push China in a new direction? China is a single party socialist state saddled with a transition economy, an immature legal system, and a historical legacy of more than two millennia in which the subordinate role of law as a means of achieving social order stunted the growth of a culture of legality. Can institutions, rules and practices that play a central role in modem western liberal democracies with mature market economies be transplanted to China? Will they take root and flourish in China's very different soil? It is now common practice to begin every discussion of globalization by observing that its meaning is contested. Having noted that the term is used in multiple, often contradictory ways, the author then proceeds to offer his or her own interpretation. Not wanting to risk upsetting settled expectations, I shall define "globalization" for present purposes as the processes of convergence in * Acting Professor of Law, University of California, Los Angeles; J.D., Columbia Law School; Ph.D., Philosophy, University of Hawaii; M.A., Chinese Religions, University of Hawaii; B.A., Philosophy, University of Wisconsin - Madison; [email protected]. I would like to thank Michael Asimow, Anne Carlson, Donald Clarke, Michael Dowdle, Mitu Gulati, Jerry Kang, Ken Klee, Stanley Lubman, Eric Orts, William Rubenstein, Richard Steinberg, Kirk Stark, Wang Xixin and Jonathan Zasloff for providing numerous truly helpful comments on earlier versions of this Article. Guy Scoffoni was kind enough to respond to my inquiries regarding French administrative law. In addition, I owe a special debt of gratitude to Jody Freeman for en- lightening discussions regarding her work on the role of private actors in contemporary U.S. administrative law and its relation to administrative law reform in China, Bojan Bugaric for providing both materials and insights regarding globalization, and Professors Jiang Mingan and Fang Shirong for their assistance at various stages of this project. I also thank the Berkeley Journal of International Law editors who worked on this article. 162 BERKELEY JOURNAL OF INTERNATIONAL LAW [Vol. 19:161 the economic, political, cultural and legal realms in countries around the world as evidenced in institutions, rules, norms and practices. Globalization is both a cause of convergence and a measure of the degree to which convergence has occurred. The emphasis on the processes of globalization captures both the ac- tive and resultant dimensions by bridging cause and effect, while drawing atten- tion to the dynamic, multifaceted and interactive nature of globalization. Specifically, I assess globalization's role in facilitating convergence in the goals of administrative law in China, institutions (including mechanisms for control- ling administration discretion), rules and outcomes. Part I sets the stage by locating the impact of globalization on China's administrative law reforms within the general context of globalization in the economic, political and legal realms. The forces of globalization have shaped developments in all areas in China, although the degree of impact differs in various areas. The effects are most noticeable in the economic realm, where China has embarked on reforms that have increased the role of markets and resulted in China's economy becoming increasingly integrated in global and re- gional economies.' In contrast, political reforms have been slower, as China has resisted the trend toward democracy and challenged the universality of human rights. Legal reforms fall in the middle. China appears to be marching toward a socialist version of rule of law with Chinese (some would argue Asian)2 charac- the road ahead remains a long and winding one with many teristics. However, 3 bumps and most likely the occasional detour. Globalization can be measured in many ways. Indeed, whether one finds convergence, and hence signs of globalization, or divergence, depends to a large extent on the particular indicators that one chooses, the time frame and the degree of abstraction or focus. Markets, democracy, human rights and rule of law are broad standards, and each is capable of significant variation in theory and practice. For instance, economic growth in many Asian countries, including China, has been attributed to a form of managed capitalism in which the state actively intervenes in the market; government officials blur the line between public and private spheres by establishing clientelist or corporatist relationships with private businesses; and universal laws are complemented, and sometimes supplanted, by administrative guidance, vertical and horizontal relationships, 1. See generally BARRY NAUGHTON, GROWING OUT OF THE PLAN (1995). 2. See Kanishka Jayasuriya, Corporatism and Judicial Independence within Statist Legal In- stitutions in East Asia, in LAW, CAPrrALISM AND POWER IN AsIA 173, 177-81 (Kanishka Jayasuriya ed., 1999) (contrasting "East Asian statist" rule of law with western liberal rule of law; whereas the latter is defined in terms of liberal markets, an autonomous civil society reflecting pluralistic social arrangements and legal institutions with the role of resolving conflicts between various interests in civil society, the former consists of a managed form of capitalism, a regulated civil society charac- terized by an organic conception of the state, and legal institutions that serve to implement the policy objectives and interests of the state). 3. See generally Randall Peerenboom, Ruling the Country in Accordance with Law: Reflec- tions on the Rule and Role of Law in Contemporary China, 11 CULTURAL DYNAMIcs 351 (1999). For more skeptical views, see STANLEY LuBMAN, BIRD IN A CAGE: LEGAL REFORM IN CHINA AFTER MAO xvi (1999) (professing cautious pessimism about the future of legality in China); William Alford, A Second Great Wall? China's Post Cultural Revolution Project of Law Construction, 1I CULTURAL DYNAmicS 193 (1999). 20011 ADMINISTRATIVE LAW REFORM and informal mechanisms for resolving disputes.4 Similarly, China's nascent socialist rule of law diverges in important ways from more familiar liberal dem- ocratic versions of rule of law, in part because it is embedded in a historical, cultural and ideological context in which the role of the state and the relation- ship between the state and individuals differs significantly from their counter- parts in the West. 5 Assessing the impact of globalization requires, then, that the broad standards of markets, democracy, human rights and rule of law be refined and supplemented by other measures. Nonetheless, these standards provide a starting point for measuring globalization. In contrast, globalization of culture is much more nebulous and difficult to capture. While counting the number of McDonald's and Madonna CDs is sug- gestive of the spread of pop culture, it does not tell us much about the impact of globalization on more fundamental modes of being and values that are more constitutive of a community, people or nation. Nevertheless, culture is perva- sive, and shapes the way the forces of globalization operate and their ability to affect change in each of the other areas of economic, political and legal reform. Rather than attempt a general assessment of globalization on Chinese culture, I focus on the particular ways in which Chinese traditions and cultures affect administrative law reform. Although China has not been immune from the forces of globalization, reforms in China have been, and will continue to be, driven primarily by domestic factors. China's leaders emerged from the ashes of the Cultural Revolution with a mission: to modernize the country, and most importantly, to stimulate economic growth. Deng Xiaoping and others realized the regime's legitimacy and survival depended on improving people's living standards. 6 Similarly, China's efforts in the last two decades to rebuild the legal system and create an administrative law regime are an attempt to deal with modernity. As such, the project is a continuation of an on-again, off-again struggle that began in the late Qing dynasty when China first sought to import legal institutions and codes from the West and Japan.7 While legal reform today is partly a response to the forces of globalization, such as WTO requirements and the demands of foreign investors, the main driving forces behind post-Mao reforms have been a visceral and per- sonal reaction to the arbitrariness of the Cultural Revolution by many senior Party leaders, which led to the call for a more law-based order;8 the regime's 4. See John Gillespie, Law and Development in "the Marketplace": An East Asian Perspec- tive, in LAW, CAPITALISM AND POWER IN ASIA, supra note 2, at 118, 123. 5. See infra Part I.C. 6. Deng Xiaoping returned to power on a platform that emphasized the "two hands policy" and the "four modernizations." The two hands policy meant that on the one hand, the economy must be developed while on the other hand, the legal system must be strengthened. The four modernizations referred to the need to modernize agriculture, industry, national defense, and science and tech- nology. See Jianfu Chen, Market Economy and the Internalisationof Civil and Commercial Law in the People's Republic of China, in LAW, CAPITALISM AND POWER IN EAST ASIA, supra note 2, at 70.

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