Opinion / Raymond Zhou
The 'rats' just keep nibbling
By Raymond Zhou (China Daily)
Updated: 2007-05-24 06:54
It may be the most powerfully suggestive detail of a toothpaste
commercial: After trumpeting all the benefits of a brand, the advert
closes with the stamp of approval from an authoritative organization
called Ya Fang Zu, the Chinese acronym for the National Tooth Health
Protection Group.
Imagine the shock when the Health Ministry dismantled the group, which
the Chinese press described as "one table and two people". Actually, it
had a staff of six people and has raked in 27 million yuan ($3.37
million) since its inception in 1997.
The surprise is that its certification was not legally binding and the
group itself was not even a legal entity. The non-surprise: Much of the
money went into staffers' own pockets.
Mind you, this was not the brainchild of some scam artist. It was indeed
affiliated with the Health Ministry but not exactly a department of the
ministry.
It is reported that P&G donated 10 million yuan ($1.3 million) to the
group in 2002. The multinational company later explained that the money
was meant for the namesake foundation and had nothing to do with the
certification of its toothpaste.
Whatever the truth, the pattern is clear: A government-endorsed agency
uses its power - power that is ultimately derived from taxpayers - to
enrich itself rather than serve the public.
Suffice it to say, Ya Fang Zu was not the only offender, maybe not the
worst either. The incremental cost to the consumer is so negligible that
most people would never have given it much thought.
But there are so many agencies like that in China that they constitute a
major burden on the economy. Take the real estate sector. Before ground
is broken, the builder needs to get approval from dozens of government
agencies. The process involves paying the nominal fee and, very often, a
much higher charge in the form of a bribe or a coerced donation.
On top of that come the greedy developers, who add their obscenely fat
margins. No wonder housing prices are as high as those in countries where
per-capita GDP is 100 times higher than China.
A friend who is a college president told me he had to get an approval
letter stamped by 100 different agencies before the college could build
something on its campus. And a college is not a business, at least not in
name.
That is why officials are adamant in opposing any measure that will
require real estate developers to disclose their cost structure.
A senior official in the Northeast recently told me that, in an effort to
build affordable housing for the poor, he pressured all agencies to waive
their fees. Eventually he was able to lower the cost to 600 yuan ($75)
per square meter. As a result, even the poorest of the urban poor could
afford a decent unit.
Each of these agencies is supposed to provide a service. But shouldn't we
ask how many of these services are really necessary and how many have
evolved into get-rich-quick schemes that harm the public more than help
it?
For example, food inspection is extremely important. Yet it is not
uncommon for inspectors to descend on a farmers' market only to collect
their fees. Any inspection they conduct is haphazard, driven by so-called
campaigns - meaning when their boss is checking on them.
If you compare the cost of a restaurant meal in China with one in a
Western country, you will find that miscellaneous fees levied by the
government make up a much bigger share here. This may not be alarming
when the economy is running full steam ahead, but it will drain our
competitiveness. In a classic poem, these fee collectors are called
"rats" that eat away the well-being of the people.
E-mail: raymondzhou@chinadaily.com.cn
(China Daily 05/24/2007 page10)
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