Global Policy Forum

By Luis Ramirez

A group of women stand outside a Beijing train station hawking slips of paper. They are blank receipts, complete with the official stamps of hotels, restaurants, office stationery providers and other businesses. The receipts go for $2 each - a small investment for those who buy them and then submit them to their employers for fraudulent reimbursement.

Analysts say this Beijing street scene is a broad-gauged reflection of what is happening within China's political system. They say corruption has become pervasive, especially in the atmosphere of a booming economy and rampant materialism. In January, President Hu Jintao told Communist Party officials that corruption is the strongest factor threatening the party's ability to stay in power. He urged changes to - in his words - "gradually remove the soil that generates corruption."

Mr. Hu called for new rules that would fight corruption by promoting education, institutional accountability, and civil monitoring. Politics professor Joseph Cheng at the City University of Hong Kong says such remarks indicate that leaders recognize how corruption threatens the government. "They are certainly aware that the widening of the gap between the rich and poor, when exacerbated by corruption and abuse of power on the part of the cadres, that will be a sure recipe for general social and political dissatisfaction and instability. They are taking the issue very, very seriously," he says.

Many political experts say the government fears that public anger over corruption could trigger mass protests that could destabilize the country. China has seen a rising number of peasant protests recently. Several were triggered by revelations that local officials had stolen public money that was meant to compensate impoverished farmers for land the government seized for development projects.

In the weeks leading up to this year's National People's Congress, the government stepped up its anti-corruption campaign, publicizing the arrests of allegedly crooked Communist Party cadres and officials at banks and other state-owned enterprises. Authorities say they disciplined more than 150,000 corrupt party members last year and uncovered more than $300 million in misused public funds.

However, many China analysts predict the effect of the arrests and campaigns will be minimal. University of Michigan political science professor, Kenneth Lieberthal, says the greater challenge for China's leaders lies in finding a deeper, structural cure. "The problem for them is that the Communist Party itself has become very corrupt, along with government officials and along with many who don't serve in the political apparatus. It's hard to clean up corruption when the instruments you're relying on are themselves corrupt," he says.

Observers say one big problem is the way the Communist Party's system of checks and balances is structured. The system relies on what are known as disciplining commissions to investigate corrupt activities. But Professor Lieberthal says the commissions are flawed. "The people that they're investigating are also their bosses. As long as you have that situation existing, you're not going to get very thorough investigations of the real centers of corruption at each level of the national hierarchy," he says. He and other experts say one solution is to make the commissions answerable to higher-level officials.

Another problem lies in the lax management of many state-owned businesses. Officials at these inefficient industries have long been able to pad their own bank accounts by siphoning off cash or taking favors from vendors. Analysts say the government does not appear ready to relinquish direct control of state-owned enterprises, because the individual interests of literally millions of officials are at stake. But even China's rapid economic liberalization and move toward private business foments new corruption.

Liao Ran with Transparency International, an anti-corruption group based in Germany, says economic reforms, including privatization, provide officials with new opportunities to cheat. "It's a market economy, but it's still halfway a centrally planned economy. That means the government officials still have power, but the market is there so all the people try to get rich. They trade money with power," he says. As a result, analysts say, while deputies at this session of the National People's Congress may discuss anti-corruption legislation, profound changes are unlikely.

While officials talk, many Chinese on the streets express anger over the seemingly unending reports of graft. At the funeral of purged Communist Party reformer Zhao Ziyang in January, a mourner stood on a sidewalk and recited a poem she wrote, one that speaks of despair over failed efforts to stamp out corruption. The mourner says the government has long fought corruption, seemingly to no avail. She says the hearts of the Chinese are heavy as they see what is happening. Leaders, she says, should be clean, righteous and honest.