China, as I once was memorably told by a group of lawyers in Beijing, is a volcano waiting to explode. It is difficult for those not familiar with the country to comprehend the scale of corruption, the waste of capital, the sheer inefficiency, the ubiquity of the party and the obeisance to hierarchy that is today\’s China. The mass of Chinese are proud and pleased with what has been achieved since Deng Xiaoping began the era of the \”socialist market economy\”. But there is a widespread and growing recognition that the authoritarian model has to change, a fact that every disaster dramatises.
The railway ministry is a classic example. It is a state within a state, making its own rules and with its own well-honed, corrupt hierarchy commanding unquestioning obedience. Charged with building 9,000 miles of high-speed rail by 2020, as well as developing an allegedly indigenous high-speed rail capability better than Japan\’s or Europe\’s, it has pulled all the familiar levers to achieve its task. Huge loans from state-owned banks, directed to lend to the ministry in effect for free, have been thrown at the project. Technology has been purloined and stolen from abroad. Productivity, efficiency and safety are secondary to two overwhelming needs: to complete the network fast, so creating crucially needed jobs, and to be able to boast that China\’s capability is cheaper than anybody else\’s.
To win the lush contracts, officials\’ palms have to be liberally greased. Rail minister Liu Zhijun, architect of the high-speed rail plan, was suspended pending a corruption investigation in February. Nor is there is any open system to see whether the technologies actually function properly. There is no back-up for any systems failures, because there is no structure of accountability or any penalties if there are mistakes. The only excuse has been that until now the system has delivered. But Japan\’s bullet train has been operating for nearly 50 years without a single death. Now China has 39 on its hands with a system only four years old.
It also has 10,000 kms of high-speed rail already built whose economics depends on the trains being full. But nobody trusts the technology or the integrity of the officials running the system. The government promises a full inquiry, but nobody has any faith it will be anything else than a fix. China is discovering that a sophisticated knowledge economy operating at the frontiers of technology is incompatible with an authoritarian one-party state.
Remember, this is the man who insists that the British State must have much more power over the British economy. Who argues, wee3k in and week out, that the State must be building more infrastructure. He can see the mote in the Chinese system but not the beam in his own recommendations.
The answer to this conundrum being of course that in Willy\’s version of England Willy will be the one doing the telling everyone what to do. And he is clever enough, omniscient, benevolent enough, not to ever fall into the trap of doing the wrong thing.
Kip Esquire\’s Law again: all those who advocate planning see themselves as the planners. And clearly immune to any of the mistakes that other planners make.