Since 2008, Beijing has tried to bring Taipei closer through increased economic and people exchanges. But the recent vote on the island suggests this approach isn't working. Please follow this link to read the entire article, "How Taiwan's Election Highlights the 'Failure' of China's Cross-Strait Strategy," featuring Jerome A. Cohen and Yu-Jie Chen published online by the Asia Society.
The following comment by Professor Jerome A. Cohen appeared in the New York Times "Room for Debate" web-feature on July 31, 2010. Professor Cohen was one of several scholars to comment upon China's recent ban on public shaming of criminal suspects.
Some years ago, I went to the city of Fushun in northeast China to meet the deputy mayor in an effort to settle a dispute that started with a Chinese company's fraud against its American joint venture partner. I was prepared to report the case to the police and prosecutors if necessary but could hardly be confident whether I would be taken seriously.
As I approached Fushun by taxi, I was passed by a long parade of open trucks that interested me more than it did the roadside pedestrians who took little note. In the open part of each truck stood three hapless Chinese, each held by the scruff of the neck by a uniformed policeman and each wearing a large sign with the name "Economic Criminal."
It was not clear where they were going or had come from. Were they en route to a public accusation, a mass trial or sentencing or even a mass execution? Or was this vehicle parade, held during one of China's periodic "strike hard" campaigns against crime, simply a public deterrent against further misconduct?
I told the mayor, who was responsible for supervising the defrauding company, how happy I was to see that economic crime was being vigorously suppressed. He got the point and settled amicably.
Every government "shames." The questions are always: how, for what purposes and with what effects? Some government actions are designed to shame, but shame is often a byproduct of other actions that serve less controversial purposes.
The Chinese people continue to be troubled by crime and need effective police protection. Yet their increasingly educated and "rights conscious" society increasingly condemns police arrogance, brutality and errors. Memories of the public humiliation, torture, suicide and killing of the Cultural Revolution are still in the minds of mature citizens, and the Internet and, occasionally, investigative journalists reveal and ridicule today's law enforcement scandals.
Ordinary Chinese who formerly had no voice are beginning to express a strong desire for equality, fairness and justice and for recognition of individual dignity in daily life. They now ask: Why are alleged prostitutes paraded before they are convicted? What about their patrons and pimps and the corrupt police who will let them work again as soon as the "strike hard" campaign is over?
Will this latest attempt by the central government to stop this form of "shaming" succeed? Those who understand China's government have a saying: "The center has its policies. The locality has its ways of evading them."
This article was published in the New York Times on July 28, 2010 under the title, "A Scholar’s Insight Into China’s Budding Legal System."
Author: Richard Bernstein
NEW YORK — It was the early 1970s, and Jerome A. Cohen, at the time a specialist on China at Harvard Law School, was having dinner with Prime Minister Zhou Enlai in Beijing.
“I told Zhou, ‘You should put somebody on the International Court of Justice,”’ Mr. Cohen recalled. “Well, he and the other Chinese officials at the dinner laughed uproariously. They thought I was Jack Benny. Why would Communist China want to put somebody on a court where they’d be outvoted by all those capitalist judges?
“But they’ve done it,” Mr. Cohen said, illustrating one of the things that seems normal in China today but that was almost unthinkable when China’s opening to the world was brand new. “They’ve staffed all international organizations with excellent legal talent.”
Mr. Cohen, who essentially created the U.S. study of law in the People’s Republic of China, has been following developments in Chinese law for roughly half a century, lately as professor of law at New York University and as a frequent commentator on various legal and human rights cases in China.
It’s fair to say that when Mr. Cohen got started, the U.S. study of modern Chinese law didn’t exist, and neither really did law in China. And so, he’s had a privileged view of a remarkable development, the creation virtually from scratch of the entire Chinese legal system.
Mr. Cohen recently celebrated his 80th birthday, which seemed a good time to ask him to assess how China has done over the years.
Most people who follow the frequent accounts of human rights violations in China would answer that China hasn’t done very well, and when it comes to human rights, Mr. Cohen largely agrees. In the last few years he has become a major source of information about human rights, or their absence, in China, his specialty being the instances where China fails to observe its own law.
Only last week Mr. Cohen published an article on the case of Xue Feng, a naturalized U.S. citizen recently sentenced to eight years in prison in China for helping his U.S. employer purchase a commercial database on Chinese oil resources — an act that the Chinese Ministry of State Security deemed to be a violation of the country’s catchall state secrets law.
Mr. Cohen’s article, published in The South China Morning Post and in Chinese in The China Times on Taiwan — both newspapers that are paid attention to inside China — listed at least half a dozen instances in which the police or prosecutors broke China’s own law in their handling of Mr. Xue’s case.
After he was seized by the Chinese police in November 2007, for example, Mr. Xue was held incommunicado for months in a secret prison. He was tortured. He didn’t have access to legal counsel for about a year. And his trial was closed not only to the public but to Mr. Xue’s family — all in blatant violation of China’s own Criminal Procedure Law.
In addition, the U.S. Consulate wasn’t informed of the arrest of Mr. Xue for 32 days, rather than the four days provided for in the two countries’ consular agreement.
But while Mr. Cohen has the expertise to point out these violations and to publicize them, he takes a moderate and balanced view of the overall picture, seeing some promise in the creation of an entire legal culture that simply didn’t exist before.
“There are now some 200,000 judges, close to 180,000 prosecutors, roughly 170,000 lawyers, and thousands of law professors, as well as tens of thousands of people with legal training who staff local, regional and central government agencies and most large enterprises,” Mr. Cohen said. “And while they have different viewpoints, they all do have an interest in promoting a legal system that’s blatantly inadequate in some respects, but does well in others.”
Over the years, Mr. Cohen has met with members of numerous legal delegations organized by the Chinese Supreme Court that have visited the United States, including one soon to arrive to study punishment policies — “because they want to improve, and they know they are under enormous criticism abroad because of their death sentence policy.”
“Last year a delegation came to study exclusion of illegally obtained evidence, an effort to stop coerced confessions and torture,” Mr. Cohen said, pointing out that last month China published new rules trying to ensure that coerced confessions wouldn’t be admitted in courts.
“But,” Mr. Cohen said, “when it comes to the most basic questions of the fundamental decencies that every government should observe toward its own citizens, this government and this party have failed to cut the mustard.”
It’s a paradox, explained in part by Mr. Cohen as an unintended consequence of China’s efforts to build a legal system, which its leaders want for the sake of credibility and legitimacy.
“They’ve done a lot to create an awareness of law and rights, and they’ve trained a series of overlapping legal elites that want to use their legal educations to help people defend those rights,” Mr. Cohen said.
But with more and more people seeing the law as a means of challenging arbitrary authority — by protesting being evicted from their homes by real estate developers, for example — the security apparatus steps in to enforce what China often calls “social stability.”
“The first reaction of the leaders is repression,” he said. “And in cases that involve state security, they’re not too fastidious about their own law.”
Mr. Cohen has what might be called the foreigners’ advantage in calling attention to China’s human rights shortcomings. He can freely write and publish, where Chinese colleagues cannot. And, while he has no doubt angered the authorities from time to time, he is clearly held in high esteem by many in the budding Chinese legal world itself.
In May this year, Tsinghua University Law School in Beijing held a conference on criminal justice and the role of defense lawyers in honor of Mr. Cohen’s 80th birthday, which would seem to be a sign of progress in itself, even if, as is often the case in China, a note of repression marred the event. At the last minute, one leading Chinese criminal defense lawyer was removed from the program by the authorities — no explanation provided.
BEIJING—The detention and televised confession of political crimes by a Swedish activist in China has sent chills through communities of foreigners that engage in civic issues in the country.
Beijing’s public shaming of Peter Dahlin is a sign that China’s leaders may now be trying to muzzle international critics with the same tactics they’ve deployed against local dissidents, say activists, lawyers and academics.
In footage that was played repeatedly by state broadcaster China Central Television on Wednesday, Mr. Dahlin is shown admitting to having broken Chinese laws through a small legal-aid nonprofit he co-founded in 2009.
“I have caused harm to the Chinese government, I have hurt the feelings of the Chinese people,” Mr. Dahlin says in the video. “I apologize sincerely for this and am very sorry that this ever happened.”
State media reports accused the Swede of endangering state security—a serious crime that carries a potential life-sentence—by funding Chinese human-rights lawyers and compiling reports on China’s rights record. They also alleged that hostile foreign forces planted Mr. Dahlin in China.
In a statement on Thursday, a spokesman for Mr. Dahlin’s nonprofit, called the China Urgent Action Working Group, dismissed the allegations as baseless and suggested his confession had been coerced. The charges show “the authorities consider the promotion of human rights through public interest litigation to be a criminal activity,” said Michael Caster, the spokesman.
The Swedish Embassy in Beijing noted the media reports about Mr. Dahlin but declined to comment further. Swedish officials “continue to work intensively” on Mr. Dahlin’s detention, an embassy spokeswoman said.
China’s Foreign Ministry has said it is respecting Mr. Dahlin’s legal rights, including granting consular officials access to him.
Televised confessions are increasingly common in China, but rare for foreigners and even more so for political crimes. In 2013, Charles Xue, a Chinese-American businessman who criticized the government online, confessed on TV to soliciting prostitutes. The same year, Peter Humphrey, a British investigator involved in a business dispute, confessed on TV to illegally obtaining personal information on Chinese citizens for profit. Both men were detained and then released, Mr. Humphrey after nearly two years.
This image from Chinese TV shows Peter Dahlin, the Swedish co-founder of a nonprofit in China, confessing to political crimes that his advocates say was coerced. PHOTO: CCTV VIA AP VIDEO
Mr. Dahlin’s disappearance in early January and subsequent reappearance on television two weeks later has stoked anxiety among other foreigners working on Chinese civil society issues, including in areas previously seen as less sensitive, such as anti-discrimination.
“This is a red alert. It’s super red,” said one former country director of a foreign nonprofit in China.
The portrayal of Mr. Dahlin as an instrument of hostile foreign forces comes amid a resurgence in Maoist ideological rhetoric and heightened concern in China over the influence of foreign ideas.
Much of Beijing’s attention has focused on the influence of foreign civic groups, which Beijing fears could be trying to foment unrest of the sort that toppled regimes in the former Soviet Union and more recently in the Middle East. Foreign media coverage, textbooks and scholarship have also come under attack in state media.
Jeffrey Wasserstrom, an expert in modern Chinese history at the University of California, Irvine, said the treatment of Mr. Dahlin illustrates the growing difficulty of determining where Beijing’s political red lines are—and the harsher punishments meted out for crossing them.
“There are many cases where things that seemed relatively unproblematic to do a few years ago or even 12 months ago have gotten people into trouble,” he said. “The system has always been far from purely rational and predictable, but now it is even more so.”
One key source of concern in Mr. Dahlin’s case, some foreigners say, is state media’s depiction of reports he wrote on China’s human-rights situation as being a part of his criminal activity. CCTV said reports Mr. Dahlin sent to foreign groups were based on data he collected online and hadn’t personally witnessed, raising questions over their accuracy.
Legal experts say these were likely standard memos that are required by nearly all major nonprofit donors.
“They make it seem like it’s some sinister foreign intelligence report when in fact it’s the most natural of observations about how money is being spent to improve human rights in China.” said Jerome Cohen, a veteran China legal scholar at New York University.
The segment also showed an interview with a member of China Urgent Action Working Group identified only by his surname, Wang, who said Mr. Dahlin twisted or fabricated facts in the reports. “In fact, the aim was to create a disturbance, to wait for the right moment to try to subvert our nation’s sovereignty and the leadership of the party,” the man said. Chinese activists identified the man as Wang Qiushi, a human-rights lawyer who was detained by police this month.
The criminalizing of negative reports about China could potentially curb the activities of not just activists, but academics, analysts, journalists and others involved in collecting and publishing information about China, legal experts said.
“One could well imagine that reports regarding health or other subjects like that which might be considered injurious, given the very broad definition China has of its national security, could also be subject to prosecution,” said Lester Ross, a lawyer with many years’ experience working in China.
Some in China have advocated using the country’s criminal laws to more aggressively counter international criticism of the country. In December, a website belonging to the Communist Youth League quoted legal scholar Zhu Wei arguing that a German citizen who had compared Mao Zedong to Hitler in a controversial YouTube video could be punished under Chinese law—even though he lives abroad.
Mr. Wasserstrom said a rising tide of official criticism might make it riskier to conduct some research in China and lead to self-censorship by younger scholars eager to maintain research access in the country.
Published January 21, 2016.
BEIJING—The detention and televised confession of political crimes by a Swedish activist in China has sent chills through communities of foreigners that engage in civic issues in the country.
Beijing’s public shaming of Peter Dahlin is a sign that China’s leaders may now be trying to muzzle international critics with the same tactics they’ve deployed against local dissidents, say activists, lawyers and academics.
Alvin Y.H. Cheung discusses the disappearance of the Hong Kong booksellers and its major implications for freedom in Hong Kong. Please click this link to read the Irish Times article, "Return of TV confessions spells trouble for dissidents in China."
Chinese vase frenzy: bribery and the auction house
As the Chinese government pays ever more attention to the country's pervasive corruption, art auctions have become the latest ruse for those giving or soliciting bribes.
By Malcolm Moore, Shanghai
12:30PM GMT 25 Mar 2011
Auction houses on the Chinese mainland are poorly-monitored, according to Li Ling, a law lecturer at Northwest University in Xian, and present a useful forum for people to pass bribes to each other.
The Chinese vase frenzy: Bribery and the auction house
The vase came from the collection of Dai Run Zhai, a Chineseman who became New York's most distinguished art dealer after moving to America in 1950
The practice helps to explain some of the hugely-inflated prices that have been paid for Chinese art in recent years, although there is no suggestion that international auctions are also being exploited by grafters.
A typical scenario would see the person who wants to be bribed putting an artwork or antique of little value up for auction. The briber then buys the agreed piece for a huge sum, according to Ms Li in a research paper, 'Performing Bribery in China.'
Sometimes, the auction house is not even required.
In one case discovered by prosecutors in the eastern city of Nanjing, a property developer bought two paintings directly from a government official. The appraised value of the paintings was 3,000 yuan (£284), but the developer paid more than 333 times as much.
The sly arrangement, and the role of the auction houses, has become the subject of a quasi-autobiographical bestseller by Hu Gang, a Chinese author and former auctioneer.
Mr Hu was convicted in 2003 for bribing three judges with 490,000 yuan in exchange for commissions to carry out auctions of court-seized property. He wrote "Celadon", a novel about a corrupt auctioneer, from his jail cell.
In the book, a protagonist called Mr Zhang bribes a judge in a remarkably circuitous way.
First Mr Zhang arranges for a tutor to teach the judge's son Chinese calligraphy. Then, he discreetly auctions the son's calligraphy at his auction house, and instructs his friend to bid for it. As the auctioneer, he then hands an envelope of cash to the judge, even subtracting the auction commission from the total.
"It can stand any investigation," Mr Zhang reassures the judge.
Mr Hu has confirmed that while the book is fiction, it is an accurate reflection of real life. The book has become wildly popular in China as a manual of how to practice the delicate, and often underhand, art of cultivating business relationships.
The plight of Chen Guangcheng and his family continues to attract attention inside and outside China. Chen is a self-trained legal advocate who has represented farmers, the disabled, and other groups. He is perhaps best known for the attention he drew to population planning abuses, particularly forced abortions and forced sterilizations, in Linyi city, Shandong province, in 2005. In deeply flawed legal proceedings, authorities sentenced him in 2006 to four years and three months in prison for, among other things, "organizing a group of people to disturb traffic order." While imprisoned Chen was reportedly beaten by fellow inmates and denied medical treatment. Following his release in September 2010, Chen, his wife Yuan Weijing, and their six-year-old daughter have faced stifling conditions of home confinement and constant surveillance. Chen and Yuan reportedly have been beaten since being released, and until recently their daughter was denied schooling. Chen's health also remains in doubt as he suffers from a digestive disorder. Authorities have continued to employ violence to prevent the growing numbers of journalists and supporters from visiting the family. Online campaigns in support of Chen have also sprung up in China, yet the government has censored terms that relate to him or his case. Witnesses examined why the Chinese government has not permitted access to information regarding Chen Guangcheng's circumstances and well-being nor permitted visitors to see Chen. Witnesses also examined the criminal procedure violations related to Chen's current detention under an illegal form of "house arrest" and Chen's access to legal counsel.
This article was originally published in The New York Times on April 20, 2012 under the title, “Chinese court overturns a young tycoon's death sentence."
BEIJING — The Supreme People’s Court on Friday overturned the death penalty against a 31-year-old woman who was convicted of financial fraud three years ago after becoming rich through a company that sold beauty products and other goods.
The case of the woman, Wu Ying, ignited an enormous outcry in China, especially on the Internet, and strengthened public criticism of the death penalty.
Xinhua, the state news agency, reported that the supreme court, which agreed in February to review the case, refused to approve the death sentence imposed by a lower court and said that the sentence needed to be revised by the High People’s Court of Zhejiang, a coastal province that is home to Ms. Wu and many other entrepreneurs.
Ms. Wu was sentenced to death in December 2009 by the Jinhua Intermediate People’s Court in Zhejiang for cheating investors out of $60.2 million. Ms. Wu, the founder of Bense Holding Group, raised $122 million from investors between 2005 and 2007, according to official reports.
Her supporters said she had been transparent in her business dealings and had not tried to hoodwink investors. Rather, they said, she was trying to raise money through private financing and loans. In China, private entrepreneurs can have a tough time getting financing from state banks, which prefer to lend to state-owned enterprises. In Zhejiang, and particularly in the manufacturing city of Wenzhou, near Ms. Wu’s hometown, underground lending markets catering to ambitious entrepreneurs have sprung up as a result.
Critics of the lower court’s decision also said that double standards had been applied in Ms. Wu’s case: well-connected defendants convicted of financial fraud appeared to get more lenient sentences, they said, than did Ms. Wu, a self-made tycoon who quit school as a teenager.
Opponents of the death penalty praised the supreme court’s decision and posted triumphant comments on microblogs, where discussion of Ms. Wu’s case had gained the most traction, especially among intellectuals.
“This is a victory for Internet public opinion in China,” wrote Hu Xijin, the editor of Global Times, a populist newspaper that often takes a nationalistic line. “I still say this: No murder, no death penalty. This applies to everyone.”
He Bing, the outspoken vice dean of the law school at the China University of Political Science and Law, wrote, “It should be recognized that the Internet provides a convenient venue for public supervision of justice.”
But in its ruling, the supreme court reaffirmed the guilty verdict in the case. That raises the prospect of Ms. Wu’s supporters continuing to lobby the courts to overturn the original verdict.
“Wu obtained an extremely large sum of money through fraudulent fund-raising, causing severe losses to the victims, undermining the national financial order and creating extremely harmful effects, and thus entails a penalty in line with the law,” the supreme court said in its ruling, according to Xinhua.
In an online interview with Internet users, Ms. Wu’s father, Wu Yongzheng, said he was “not satisfied” with the review by the supreme court and did not trust the court in Zhejiang to resentence his daughter.
Jerome A. Cohen, a scholar of Chinese law at New York University, said in an e-mail interview that the supreme court decided that the accused need not be sentenced to immediate execution, opening the way for a new sentence, including death with a two-year suspension. That usually means that the convicted person will never be executed; after two years of good behavior, he or she might get a life sentence.
“But, by sending the case back for resentencing, it leaves open the possibility that Wu may immediately get an even lighter sentence than a two-year suspended death penalty, such as 15 years,” Professor Cohen said. “This seems a typical Chinese judicial compromise between what those who call for the death penalty wanted and what Wu’s many supporters, both popular and professional, have called for.”
China executes more criminals than any other nation, but it is not unusual for a high court to reject a death sentence after a review. People following Ms. Wu’s case expected the supreme court to reject the original sentence after Prime Minister Wen Jiabao said at a news conference in March that the court should handle her case carefully.
Some people say the supreme court’s decision could also be related to a political scandal that has enveloped the highest ranks of the Communist Party.
Famously, there were no rejections by higher courts of any of the 13 recent death sentences that resulted from what was billed as an anticrime campaign in the western metropolis of Chongqing. That campaign, called “smash the black,” was started by Bo Xilai, the city’s party chief and ambitious member of the central Politburo.
But Mr. Bo was removed from his Chongqing post in March and is now under investigation for “serious disciplinary violations” while his wife, Gu Kailai, is being investigated in the murder of a British businessman, Neil Heywood. Many prominent lawyers say the smash the black campaign was an affront to the justice system, and some victims of it say it was an effort by Mr. Bo to destroy his or his allies’ personal enemies.
Li Bibo and Edy Yin contributed research.
BERNARD GWERTZMAN: Greetings. Welcome to our call-in show. And we have a lot of news to talk about today.
And we're lucky to have as the speaker Professor Jerome A. Cohen, who's probably the leading expert on Chinese law in this country. He's worked in China. He speaks fluent mandarin. And he's been writing his head off about the human rights problems in China for many years.
And I'm going to launch the first question, which is on the news, which just happened in the last several hours, this -- Jerry -- Chen Guangcheng, the blind Chinese dissident who had fled house arrest and somehow miraculously, with the help of his supporters, ended up in the American embassy in Beijing. And the coincidence in timing was fortuitous because Secretary of State Clinton and Mr. Geithner, the Treasury secretary, were on their way to China and they're there now for these annual security and economic talks.
And a deal apparently was struck with the Chinese government allowing him to leave the embassy, get medical help at the hospital and then to be transferred to another city in China where he'll be able to study and live with his family.
Can you fill in some details on this?
On May 4, 2012, Professor Jerome Cohen discussed the possibility of Chen Guangcheng's stay as a visiting scholar at NYU School of Law with PBS NEWSHOUR host Ray Suarez. Please follow this link for the video excerpt of Professor Cohen's Public Broadcasting Station NEWSHOUR discussion with Ray Suarez, "Chen [Guangcheng] Might Soon Study in U.S., but Concerns Persist."
The Eighteenth Chinese Communist Party Congress opens on Thursday amid murky signals about the Chinese leadership transition, says CFR's Jerome A. Cohen. He says that of the top seven political leaders who make up the Standing Committee of the party, Xi Jinping, the designated next president, and Li Keqiang, the designated premier, are known, but "we don't really know what they stand for, what they're likely to do." Cohen says no matter who was elected U.S. president this week, it "isn't going to make much difference because every president, when the political rhetoric is over, has to come to grips with this rising, unknown difficult phenomenon" of China.
Two days after Americans voted to reelect Barack Obama as president, the Eighteenth Chinese Communist Party Congress will convene in Beijing, from which a new Chinese political leadership will emerge. What are your thoughts about this coincidence?
The processes by which the two governments select their leaders could not be more different. In Beijing, two days before the opening of the Congress that will select the seven top people, the Standing Committee of the Politburo of the Chinese Communist Party, very little is known. We know the identities of two of the seven: Xi Jinping, who next year is likely to be the next president of China, and Li Keqiang, who is slated to become premier. But we don't really know what they stand for, what they're likely to do, and we don't know how they've been selected.
What about the other five?
It's even murkier because it is not clear who they will be. There are still discussions going on, as far as we can tell. We don't know who the decision-makers are, who are the horse traders in deciding who's on and off the seven-person Standing Committee. Of course, all the contenders for the final five spots, even if they lose, will be on the broader twenty-five-member Politburo itself. But what do these people really stand for? Are they simply very intelligent, very cautious political bureaucrats who have risen through a variety of challenges, never really revealing what they think, always trying to pander to the policies of the higher-ups? And once they reach the inner circle, is there any way of knowing what they're going to do? Of course, in every government, it's hard to predict how a presidential candidate, for example, will behave as president.
Why don't you talk first a bit about the two who are definite, Xi Jinping and Li Keqiang?
Xi Jinping is a so-called "princeling." His father, former vice premier Xi Zhongxun, was a famous leader. Although he could be said to have grown up initially with the Communist equivalent of a silver spoon, he spent a long time out in the boondocks trying to carve out his own reputation for doing things without parental assistance. He's an intelligent, balanced person, well-educated, highly experienced, and virtually unknown – and perhaps unknowable. Predictions for him include, "Once he gets confident in office, he's likely to be an intelligent law reformer and political institution reformer." Another view, and more likely to happen, is he's likely to be a disappointing bureaucrat, some say in the model of former Soviet leader Leonid I. Brezhnev – someone who was not able to meet the challenges that a highly developing country is confronted by.
Li Keqiang is significant in one respect certainly. He is the first law graduate to assume a high office in the People's Republic. There's never been, as far as I know, any law school graduate in the Standing Committee in the Politburo. This man is highly intelligent. His classmates at Peking University Law School, where he graduated in 1982, give him high marks, although devoted to politics even at that time. Since then, he's shown little evidence of his legal training. He's shown no real proclivity for helping to reform a legal system that badly needs to be reformed. He has been highly political in some cases. People say he shows insensitivity to human rights. But again, all these people are enshrined in mystery and very, very cautious about saying anything publicly.
How much influence does President Hu Jintao maintain?
There is an ongoing negotiation among the leaders who have at least nominally retired, those who are about to retire, and those who are about to ascend to office. It's kind of a three-cornered struggle, or bargaining process, and it's all behind very, very closed doors where rumors emerge of a very uncertain nature. It's a preposterous way for the leaders of such an advanced and prominent country to be selected.
Even if one disregards the desirability of consulting the people of the country about who their governors are going to be, just from the point of view of an efficient way of arranging things, these people have not moved very far beyond the selection of the elite under the Manchu Dynasty. And when you get into murder plots involving one of the members of the Politburo, Bo Xilai, who was hoping to be among the seven members of the Standing Committee, and the poisoning of someone [Neil Heywood] said to be a foreign spy by Bo's wife, who feared exposure of their corruption, this is a little much.
Do we have any sense of how relations between the United States and China will be in the next several years?
The Chinese are confronted by a problem similar to ours. People worried, "What if Mitt Romney won? What will our China policy be, compared to if Obama won?" But experience over the last forty years suggests that it probably isn't going to make much difference because every president, when the political rhetoric is over, has to come to grips with this rising, unknown difficult phenomenon: China.
And the Chinese have a similar problem. They know they need the United States very, very much. They know they have interests that seem to clash rather sharply in some respects. And they know whoever takes over has to be cognizant of the complexity of the relationship and the desirability of not only sustaining it, but also improving it.
You have been very critical of China's human rights record. Can you speak to that?
The Chinese are faced with a broad range of challenges, not least of which is what to do about the rule of law. What is going to happen to a growing demand in the country for human rights, not just to close the gap, which is huge now, between rich and poor, but also to try to create institutions that will provide outlets for the very large number of grievances publicly expressed – often in violent forms – that seem to plague China? The leaders either have to continue to rely on repression, which seems to be their immediate weapon of choice, or they have to decide to give more vent to the increasing steam from below.
In the mid-1980s, in Taiwan, you had a Kuomintang Nationalist Party dictatorship that was confronted year after year by more and more demands for freedom, for democratic process, for liberal institutions. And they kept repressing them. Chiang Kai-shek's son, Chiang Ching-kuo, knowing he was quite ill and didn't have that much time to go, decided that they couldn't go on relying on repression. They had to start a process that would gradually open up the system and give greater participation to the rights-conscious people who were increasing every year in number. When I first went to Taiwan in 1961, he was in charge of the secret police. He was known to be a vicious repressor of all democratic instincts, especially those where people were trying to say they wanted to be independent of the Kuomintang mainland Chinese rule. And yet when he died in 1988, I found myself saying quite nice things about him, because in the years just before his death, he had initiated a process that has now – we can see a generation later – led to the first democratic rule of law society that the Chinese have ever really spawned. It is more democratic than Singapore and eons ahead of anything produced on the mainland.
Are any of the current leaders advocates of a more liberal policy?
You don't get to the top of this greasy pole by advocating liberal political reform, human rights, and rule of law. We never know until a person gets to the pinnacle how he's going to behave. Nobody knew in 1956 that Nikita S. Khrushchev was going to adopt a policy known as de-Stalinization. I had thought Khrushchev was another running dog of Stalin. Well he was, and he hated it. And when he got to power three years after Stalin's death, he initiated an opening process. It didn't go as far as many liberal reformers wanted, but it was a surprise to people, including the Chinese who were present at the Twentieth Party Congress of the Soviet Communist Party. Nobody knew that Mikhail Gorbachev, despite the fact that he was known to be a law school graduate, was going to engage in perestroika. He may not have known it himself.
The New York Times scrutinizes this fellow Wang Yang, the Communist Party secretary of Guangdong province, right next to Hong Kong. Wang Yang, from time to time, has sounded like he might be the next generation's liberal reformer among the party elite. Until about a year ago, he made considerable noises to support that idea and occasionally engaged in some enlightened policies. In the last year or so, though, he's been rather quiet, especially since the fall of Bo Xilai, who was often seen to be his opposite number and rival. He has been trying to behave himself so he would look just as staid and boring as the other candidates – innocuous, reliable, a team player, a consensus builder; not somebody who is colorfully going to stick his neck out and try to engage in democratic experimentation.
This article was originally published in The New York Times on November 24, 2012 under the title, “Lobbying, a Windfall, and a Leader's Family."
SHENZHEN, China — The head of a financially troubled insurer was pushing Chinese officials to relax rules that required breaking up the company in the aftermath of the Asian financial crisis.
The survival of Ping An Insurance was at stake, officials were told in the fall of 1999. Direct appeals were made to the vice premier at the time, Wen Jiabao, as well as the then-head of China’s central bank — two powerful officials with oversight of the industry. For more news on Wen Jiabao published in the New York Times, please follow this link.
“I humbly request that the vice premier lead and coordinate the matter from a higher level,” Ma Mingzhe, chairman of Ping An, implored in a letter to Mr. Wen that was reviewed by The New York Times.
Ping An was not broken up.
The successful outcome of the lobbying effort would prove monumental.
Ping An went on to become one of China’s largest financial services companies, a $50 billion powerhouse now worth more than A.I.G., MetLife or Prudential. And behind the scenes, shares in Ping An that would be worth billions of dollars once the company rebounded were acquired by relatives of Mr. Wen.
The Times reported last month that the relatives of Mr. Wen, who became prime minister in 2003, had grown extraordinarily wealthy during his leadership, acquiring stakes in tourist resorts, banks, jewelers, telecommunications companies and other business ventures. Please click this link to read more on the "hidden riches" of Wen Jiabao's family.
The greatest source of wealth, by far, The Times investigation has found, came from the shares in Ping An bought about eight months after the insurer was granted a waiver to the requirement that big financial companies be broken up.
Long before most investors could buy Ping An stock, Taihong, a company that would soon be controlled by Mr. Wen’s relatives, acquired a large stake in Ping An from state-owned entities that held shares in the insurer, regulatory and corporate records show. And by all appearances, Taihong got a sweet deal. The shares were bought in December 2002 for one-quarter of the price that another big investor — the British bank HSBC Holdings — paid for its shares just two months earlier, according to interviews and public filings.
By June 2004, the shares held by the Wen relatives had already quadrupled in value, even before the company was listed on the Hong Kong Stock Exchange. And by 2007, the initial $65 million investment made by Taihong would be worth $3.7 billion.
Corporate records show that the relatives’ stake of that investment most likely peaked at $2.2 billion in late 2007, the last year in which Taihong’s shareholder records were publicly available. Because the company is no longer listed in Ping An’s public filings, it is unclear if the relatives continue to hold shares.
It is also not known whether Mr. Wen or the central bank chief at the time, Dai Xianglong, personally intervened on behalf of Ping An’s request for a waiver, or if Mr. Wen was even aware of the stakes held by his relatives.
But internal Ping An documents, government filings and interviews with bankers and former senior executives at Ping An indicate that both the vice premier’s office and the central bank were among the regulators involved in the Ping An waiver meetings and who had the authority to sign off on the waiver.
Only two large state-run financial institutions were granted similar waivers, filings show, while three of China’s big state-run insurance companies were forced to break up. Many of the country’s big banks complied with the breakup requirement — enforced after the financial crisis because of concerns about the stability of the financial system — by selling their assets in other institutions.
Ping An issued a statement to The Times saying the company strictly complies with rules and regulations, but does not know the backgrounds of all entities behind shareholders. The company also said “it is the legitimate right of shareholders to buy and sell shares between themselves.”
In Beijing, China’s foreign ministry did not return calls seeking comment for this article. Earlier, a Foreign Ministry spokesman sharply criticized the investigation by The Times into the finances of Mr. Wen’s relatives, saying it “smears China and has ulterior motives.”
After The Times reported last month on the family’s wealth, lawyers representing the family said the article contained unspecified errors and that the family reserved the right to take legal action.
In addition, the Chinese government blocked access to the English-language and Chinese-language Web sites of The Times in China — and continues to do so — saying the action was “in accordance with laws and rules.” For more information on the Chinese government's censorship of the New York Times, please follow this link.
Neither Mr. Wen, who is expected to retire in March, nor Mr. Dai, who is now the head of the National Social Security Fund, could be reached for comment.
Western and Chinese bankers and lawyers involved in Ping An’s 2004 Hong Kong stock listing and a subsequent 2007 listing in Shanghai said they did not know that relatives of Mr. Wen had acquired large stakes in the company.
Executives at Morgan Stanley and Goldman Sachs, which once held sizable stakes in Ping An and served as lead underwriters for the Hong Kong public offering, also said they were never told of the holdings. At Ping An’s urging, the two investment banks had also appealed in 2000 to Mr. Wen and other regulators for the waiver from the breakup rule. The private equity divisions of the two investment banks sold their combined stakes to HSBC in 2005 for about $1 billion — a 14-fold increase on their initial investment. Please follow this link for more news on private equity published in the New York Times.
Thousands of pages of publicly available corporate documents reviewed by The Times suggest that the Ping An stakes held by the prime minister’s relatives were concealed behind layers of obscure partnerships rather than being held directly in their names.
In an interview last month, Duan Weihong, a wealthy Wen family friend, said that the shares in Ping An actually belonged to her and that it was an accident that Mr. Wen’s relatives appeared in shareholding records. The process involved borrowing their government identity cards and obtaining their signatures.
China and Hong Kong have detailed regulations on the disclosure of corporate information deemed material to a publicly listed company’s operation, like the identities of large shareholders and details about whether companies controlling large stakes are related parties. But legal experts say enforcement is often lax, particularly inside China. There is also, they say, a culture of nominee shareholders — when one person holds shares on behalf of someone else — that is difficult for even the most seasoned lawyers and accountants to penetrate.
The Times found no indication such regulations or any law was broken, nor any evidence that Mr. Wen held shares in Ping An under his own name.
After reviewing questions from The Times, the Securities and Futures Commission of Hong Kong and the Hong Kong Stock Exchange declined to comment. The China Securities Regulatory Commission in Beijing did not respond to inquiries.
HSBC, today Ping An’s largest shareholder with about 15.5 percent of its stock, declined to comment. The company announced last week that it is considering selling its stake in Ping An as part of a broad effort to raise capital.
Ping An today is a hugely successful conglomerate with revenue of $40 billion last year and about 500,000 insurance agents across China. It is China’s only fully integrated financial institution, with the second largest insurer, a trust company and brokerage house.
In late 2010, Ping An added more firepower, announcing a $4 billion deal that has since given it control of the Shenzhen Development Bank, one of China’s midsize commercial banks. Ping An is now building a new headquarters here in Shenzhen, a spectacular 115-story office tower that was designed by the New York architectural firm Kohn Pedersen Fox. Please click this link for more information on the design of the Ping An Financial Center.
Ping An’s Close Call
Ma Mingzhe, the Ping An chairman and chief executive, was a high school graduate who got his start as an aide to Yuan Geng, a pioneering figure in some of China’s earliest economic reforms and an early leader of Ping An.
Impressed with Mr. Ma’s intellect, Mr. Yuan put him in charge of human resources at a state-managed industrial park, and eventually at a new insurance firm, Ping An, which took root in Shenzhen, a coastal boomtown.
Mr. Ma’s timing was opportune. China was just beginning to restructure its state-led economy. The government began dismantling the iron rice bowl system, which had guaranteed pensions, social insurance and living quarters to Communist Party cadres.
Although Ping An was founded as a state entity, it was one of the first Chinese insurance companies to experiment with Western management systems, including the use of actuaries and back-office operations, as well as foreign shareholders.
Mr. Ma helped manage the tiny company when it was founded in 1988. Several years later, he was looking for big-name shareholders from the United States.
In 1994, the private equity divisions of Morgan Stanley and Goldman Sachs each paid about $35 million to acquire 7.5 percent interests in Ping An. At the time, they were the largest foreign investments ever made in a Chinese financial institution.
Much of the company’s early success was attributed to Mr. Ma, a hard-charging executive who was admired for his management and political skills — and for taking risks.
“He had all the qualities of a great entrepreneur,” says Yan Feng, who helped run Ping An’s Shanghai office in the 1990s. “He was a quick learner, knew how to adapt to new situations and was really determined. He’d do whatever it takes to get what he wants.”
But the company’s growth drive ran into trouble in the late 1990s, when China’s economy weakened after the 1997 Asian financial crisis.
The bloated state sector began to collapse, and by 1998, some of the nation’s biggest banks were nearly insolvent.
Ping An’s hard-won fortunes were also evaporating. Like most big Chinese insurers, Ping An had won new clients with investment products that guaranteed big returns over long periods based on the high interest rates banks offered for deposits during a time of inflation. When interest rates plummeted in the mid-1990s, losses piled up.
In 1999, senior executives at Ping An began to acknowledge that the company could soon be insolvent. As a joint-stockholding company, Ping An had big institutional investors, mostly state companies. But many of them refused to come to the company’s aid by purchasing additional shares, which would have provided needed capital.
“They weren’t sure Ping An would survive,” said one former Ping An executive who spoke on the condition of anonymity.
There was also mounting pressure from the government. Worried about systemic risks to the financial system, regulators in Beijing stepped up their enforcement of laws that required financial institutions to limit the scope of their business activities.
Banks were told to sell their stakes in brokerage houses or trust companies; and insurance companies had to choose to operate in life or property insurance, but not both.
After China’s new insurance regulatory agency was established in 1998, it began pressing Ping An to shed its trust and securities business, and to split its life and property insurance divisions into separate companies.
At a news conference in November 1999, Ma Yongwei, then the chairman of the China Insurance Regulatory Commission, said the agency had already drawn up plans to split up Ping An and other insurers.
“The separation plans have been submitted to the State Council for approval,” Ma Yongwei told the media, adding that they would “deepen reform of the insurance system.”
Pushing Back the Regulators
With his company about to be broken up, Ma Mingzhe, also known as Peter Ma, fired off letters to leaders in Beijing, dictated memos reminding himself to “buy golf clubs” for high-ranking officials, and kept detailed charts outlining the lobbying responsibilities of each top executive at Ping An, according to a copy of those records verified by former Ping An executives.
Mr. Ma focused much of his personal energy on China’s highest government administrative body, the State Council, a 38-member group whose senior leaders were Prime Minister Zhu Rongji and Wen Jiabao, then vice premier. The company also sought the support of Dai Xianglong, the nation’s central bank chief, who also had oversight over the insurance industry.
Mr. Wen was in a unique position. He was head of China’s powerful Central Financial Work Commission, which had been established in 1998 to oversee the country’s banking, securities and insurance regulators, as well as China’s biggest financial institutions.
When Mr. Ma met regulators, he told them his company was facing insolvency and asked them to help shore up the company’s balance sheet by approving a Hong Kong stock offering, according to transcripts of Ping An meetings and interviews with participants.
“Now, Ping An’s life insurance is in a loss, and property insurance and the trust company have thin margins,” Mr. Ma wrote in the Sept. 29, 1999, letter to Mr. Wen. The contents were confirmed by two former top Ping An executives.
Rather than an out-and-out breakup, Mr. Ma offered a middle road. After seeking advice of other investors, Mr. Ma proposed the formation of a holding company that would effectively separate life insurance from property but keep them under one corporate umbrella, along with the securities and trust division.
The company, he said, would re-establish itself as the Ping An Group, according to Ping An documents reviewed by The Times. He then began looking for allies to promote his proposal.
In January 2000, with Mr. Ma’s backing, executives from Morgan Stanley and Goldman Sachs wrote a joint letter to Mr. Wen arguing that a breakup would “violate China’s policy to encourage and protect foreign investment,” according to a copy of the letter reviewed by The Times. The letter’s authenticity was verified by former executives at the two investment banks.
The American investment banks warned that “as a listed company in the U.S., we could be required to disclose our losses relating to the investment in Ping An, which would not be helpful for the image of China’s policy of reform and opening to the outside.”
The letter came after months of aggressive lobbying on the part of Ping An executives and the two American banks to persuade other high-ranking officials in Beijing, including the central bank and the insurance regulator, to hold Ping An together, according to corporate documents reviewed by The Times.
As early as 1999, executives at Ping An also began making contact with the relatives of Mr. Wen.
Hu Kun, a former Ping An employee who served as Mr. Ma’s staff assistant from 1997 to 2000, recalled a 1999 meeting between Mr. Ma and Zhang Beili, the wife of Mr. Wen.
Mr. Hu said he was not told what transpired at the meeting, but he recalled his boss’s reaction. “Because of that meeting, Chairman Ma got very excited,” said Mr. Hu, who is now living in the United States and who has quarreled with Ping An over 52,000 shares he claimed he was owed.
Corporate records reviewed by The Times indicate that Mr. Ma held an afternoon meeting and then dinner with the prime minister’s wife and Li Chunyan, who ran Ping An’s office in Beijing, on June 17, 1999.
It is not known what they discussed, but the relationship seemed to flourish. Around the same time, a diamond company partly controlled by the relatives of Ms. Zhang began occupying office space at the Ping An office tower in Beijing, according to records the diamond company filed with regulators. Later, a start-up co-founded by Wen Yunsong, the son of Ms. Zhang and the prime minister, won a lucrative technology contract from Ping An, according to interviews with former Ping An executives.
Mr. Ma, who is 56 and still runs Ping An, declined to comment for this article. Interviews with four senior executives who worked with Mr. Ma and Mr. Hu at the corporate headquarters in Shenzhen during the same period corroborate Mr. Hu’s recollections and the content of the documents reviewed by The Times concerning Ping An’s lobbying efforts and meetings with the relatives of Mr. Wen.
In addition, Li Chunyan, who ran the Beijing office, confirmed in a telephone interview that during that period he had brought Ms. Zhang to meet the Ping An chairman, Mr. Ma.
The documents and interviews shed no light on whether those meetings played a role in the decision by government regulators to abandon plans to split up Ping An. But in April 2002, the nation’s top regulators delivered their verdict. With approval of the State Council and insurance regulators, Ping An began the process of transforming itself into a financial conglomerate.
The company was not only allowed to retain property and life insurance licenses, but also licenses that permitted it to operate a brokerage and a trust company. It was also allowed to obtain a bank license.
Together, analysts say, the licenses were worth a fortune in China’s tightly regulated marketplace.
“They were one of the few who got to enjoy these gold-digging benefits,” said Bob Leung, a longtime insurance analyst at UBS in Hong Kong.
By late 2002, Ping An had not simply survived the downturn, its prospects had begun to look bright. The company’s restructuring bolstered revenue and profits. In October of that year, one of the world’s biggest banks, HSBC, agreed to pay $600 million to acquire a 10 percent stake in the company from Ping An. Just over a year later, regulators approved the company’s application to list and sell shares on the Hong Kong Stock Exchange.
While Ping An was preparing for its listing in Hong Kong, a group of investors with close ties to senior officials in Beijing, including Wen Jiabao, were quietly accumulating large blocks of Ping An stock.
Buying Into Ping An
On Dec. 26, 2002, Ping An filings show, a company run by Duan Weihong, a Wen family friend from the prime minister’s hometown, acquired Ping An stock through a company called Taihong. Soon after, the relatives of Mr. Wen and colleagues of his wife took control of that investment vehicle, the records show.
According to documents Ping An filed ahead of its Hong Kong listing, Taihong acquired 77.7 million shares of Ping An from the China Ocean Shipping Company, a global shipping giant known as Cosco, and 2.2 million more shares from Cosco’s Dalian subsidiary. A two-for-one stock split doubled the number of shares Taihong owned. So in June 2004, just before Ping An’s Hong Kong offering, Taihong held 159.8 million shares, or about 3.2 percent of Ping An’s stock, according to public filings.
In an interview, Ms. Duan said she had paid about 40 cents a share at current exchange rates, or a total of $65 million, to acquire the shares.
The price seems to have been a huge and unusual discount, analysts say, since HSBC had two months earlier acquired its 10 percent stake for about $1.60 a share, according to public filings.
Cosco did not return calls seeking comment.
For Taihong, it was a blockbuster purchase. By 2007, when the price of Ping An’s stock peaked, the 159 million shares were valued at $3.7 billion — though by 2007 Taihong had already significantly reduced its stake, according to public filings.
While Taihong was the shareholder of record, the beneficiaries of the Ping An deal were cloaked behind more than a dozen investment vehicles controlled by the relatives of Mr. Wen, including two brothers-in-law, a sister-in-law, as well as several longtime colleagues and business partners of his wife, Zhang Beili, according to corporate and regulatory documents. All of them were listed, along with Ms. Duan, as the owners of Taihong.
And by 2007, the prime minister’s mother, who is now 91, was listed on public documents as holding $120 million worth of Ping An stock through a pair of investment companies linked to Taihong.
Ms. Duan, who says she got to know the prime minister’s family in 2000, said that she bought the Ping An shares for her own personal account. The Wen relatives only appear in the Taihong shareholding records, she said, because her company borrowed the government-issued identity cards of other people — mistakenly, she said, from relatives of the prime minister — to help mask her own Ping An stake from the public.
“In the end,” Ms. Duan said, “I received 100 percent of the returns.”
In 2001, China issued new regulations that put restrictions on trading in listed shares by Communist Party members and their families.
For instance, the rules barred party officials in charge of a state-owned company from using their parents, children — or even their children’s spouse’s relatives — to trade stocks of a listed state-owned company.
The Times found no indication that Mr. Wen shared inside information with family members.
But there are many unanswered questions about the relatives’ holdings, analysts consulted by The Times said, like who might have known about the relatives’ purchases and whether anyone had a legal obligation to disclose that information.
Executives at Morgan Stanley and Goldman Sachs say they were unaware of the share purchases and were not involved in the transactions.
The companies also said that a typical I.P.O. process is unlikely to uncover the ultimate identity of shareholders who are hiding behind layers of investment vehicles using unrecognizable names.
According to regulations in Hong Kong and China, publicly listed companies and their professional partners who help sell shares to the public are legally obligated to disclose the identities of only those shareholders controlling a stake larger than 5 percent. The Times found that at its peak, Taihong, the investment vehicle tied to the Wen family, never held more than a 3.2 percent stake.
Another question that remains unanswered is how Taihong was able to buy shares of Ping An at a price that appears to have been highly discounted. By late 2002, Ping An had already become a hot I.P.O. prospect following a big investment by HSBC.
The answers to some of the questions, legal experts say, may turn on who was involved in brokering the deal that led to the relatives’ acquiring shares in Ping An in the period before the company’s public offering in 2004, and whether the deal-makers were seeking to gain favors from the regulators.
“The key questions are: why were these people chosen, and on what terms did they get the shares?” said Jerome A. Cohen, a professor at New York University Law School and an expert on China’s legal system. “Obviously, everyone would like to get in before a hot I.P.O.”
Text courtesy of NYU School of Law News
The event, now in its 18th year, brought together current scholars, faculty, alumni and friends of the Hauser Global Law School Program. Following welcoming remarks by Dean Richard Revesz, Gráinne de Búrca, Florence Ellinwood Allen Professor of Law, highlighted the achievements and research of current Hauser fellows, and Leah Trzcinski ’13, editor in chief of the Journal of International Law and Politics, spoke of the journal’s adoption of a peer-review process. Please follow this link for the announcement of the Journal of International Law and Politics' peer-review process.
Rita E. Hauser, the alumna who founded the program with her husband Gustave Hauser (LL.M. ’57), kicked off the evening’s main event with an introduction of Chen, from his background as a “barefoot lawyer” who fought on behalf of victims of forced sterilization, to his insights into human and civil rights in today’s China.
Ira Belkin ’82, executive director of the U.S.-Asia Law Institute, gave an overview of the institute’s current projects on issues as wide ranging as land reform and the death penalty in China, and noted that its scholars not only do research, but also speak out publicly. Jerome Cohen, professor of law and specialist in East Asia law, welcomed Belkin’s return to NYU Law and shared with the audience the story of his friendship with Chen and how he became involved in Chen’s departure from China.
Speaking in Mandarin with Belkin serving as interpreter, Chen thanked his supporters in the room and offered clarification for a widely reported comment that he made in a phone call to former Secretary of State Hillary Clinton after his departure from the U.S. Embassy in Beijing last April. He had meant to say “I want to see you” rather than “I want to kiss you,” Chen said.
In New York, where he lives with his wife and two children, Chen has been able to rest for the first time in seven years, he said. He spends about half of his time working on a memoir, and the other half studying English and law and meeting with different organizations. He continues to follow events in China with interest. “Change in China is inevitable,” Chen added. “Whether the authorities are willing to change, this is the course of history.”
Asked what role he may play in this evolution, Chen answered that he is preparing for the future shifts in China by studying the Declaration of Independence and the U.S. Constitution.
Vincent R. Johnson and Stephen C. Loomis' recent article, "The rule of law in China and the prosecution of Li Zhuang," published in The Chinese Journal of Comparative Law (2013), cites current and former USALI research fellows Margaret K. Lewis, Ling Li, and Elizabeth Lynch's research on corruption and criminal justice issues in China.
On February 28th, the Pacific Century Institute awarded Professor Jerome Cohen the 2013 PCI Building Bridges Award, established to honor people who have enhanced relations between Americans and Asians and who exemplify PCI's commitment to building bridges to a better future. Former awardees include Kathleen Stephens, U.S. Ambassador to the Republic of Korea 2008-2011; Harold Brown, US Secretary of Defense 1977-1981; Maestro Lorin Maazel of the New York Philharmonic; and Christopher Hill, US Assistant Secretary of State 2005-2009.
Upon accepting the award, Professor Cohen delivered the following speech:
EAST ASIAN-AMERICAN RELATIONS: REMINISCENCE AND REFLECTION
Jerome A. Cohen
I am grateful to the distinguished Pacific Century Institute, Spencer Kim, Don Gregg and their colleagues for giving me such a welcome opportunity to think about "building bridges to Asia" - past, present and future. I feel like the man who discovered he'd been writing prose all his life! I hope you will accept my remarks as weightier, if not more humorous, than those of the late Conrad Hilton. When asked to reveal the lessons of his forty years in the hotel industry, he quipped: "Always keep the shower curtain inside the bathtub"!
Allow me at the outset a few reminiscences and thoughts about the past.
When, over half a century ago, I started to combine law teaching with research on China, some people were supportive, some thought I must be having a nervous breakdown to throw away a promising career in order to study a country so hostile to the United States, and others simply gave me poor advice. I especially remember three bits of bad advice: 1)Academic life is not a good base for activism; 2)Law will never be important to the peoples of China and East Asia; and 3) Chinese do not care about the niceties of legal concepts and terminology. In short, they said, I was barking up the wrong tree.
Certainly, as the examples of Felix Frankfurter, John K. Fairbank and many others in the respective fields of law and Asian studies have shown, the independence, security of tenure and access to knowledge of academic life have enabled many a professor to be a participant as well as an observer. Those of us who opposed American military involvement in Vietnam benefited enormously from the university presidents and deans who defended our right to speak out. Moreover, in free countries, universities have often permitted faculty to offer shelter to foreign political reformers forced to flee their own country's repressive government. I remain very thankful to Harvard for inviting Korea's Kim Dae Jung, Taiwan's Annette Lu and the Philippines' Ninoy Aquino for periods of residence and learning that gave them both protection and intellectual stimulus while awaiting political progress at home. More recently, NYU has generously welcomed China's valiant "barefoot lawyer," the blind activist Chen Guangcheng.
The observation that law was and would continue to be relatively unimportant to East Asian countries proved equally inaccurate. When in 1960 I began my study of Asia, Japan was already refuting this proposition, demonstrating that Confucian/Buddhist culture was no barrier to democracy, human rights and the rule of law. Within three decades, both Taiwan and South Korea provided further impressive evidence as each peacefully overcame oppressive dictatorship. I returned only yesterday from taking part in a unique exercise in which Taiwan's government, excluded from United Nations' regimes, nevertheless asked foreign international law specialists to evaluate its progress in implementing the provisions of the two major international human rights covenants.
Today, over sixty years after establishment of its government, perhaps the most important, controversial and difficult problem confronting China's new leadership is what to do about law and justice. Can Xi Jinping and his comrades begin to transform their "socialist legal system with Chinese characteristics" into a credible instrument for coping with immense challenges, such as corruption and environmental degradation, while satisfying the rising popular demand for not only social and economic fairness but also political freedoms and constitutional and legal justice? Vietnam is currently in the midst of similar ferment. In each country the Communist Party confronts the issue whether it will allow the development of an autonomous legal system whose proudest achievement is an independent judiciary.
The third argument - that Chinese are indifferent to legal ideas and language - also turned out to be spurious. Echoes of the millennial debates between Confucianists and Legalists can still be heard throughout East Asia. Those of you who have diplomatic experience with Chinese officials, whether from Beijing or Taipei, are undoubtedly aware of the significance they have long attached to the articulation of principles and linguistic nuance. Think of the great 1972 U.S.-China Shanghai Communique, for example. The same is true in the domestic legal systems of the Mainland and Taiwan. At the moment, both foreign and domestic scholars are scrutinizing how the large number of carefully crafted and negotiated terms and phrases in China's new Criminal Procedure Law are being interpreted and applied in practice.
THE NEED FOR NEW BRIDGES
Now for some controversial reflections about the need to build new bridges in East Asian-American relations. As we all know, this is a dangerous time for several reasons. Let me briefly touch on new ideas in two areas, despite the obvious obstacles to their implementation.
First, North Korea. It is a cliché, in light of the DPRK's recent third nuclear test, to call for a fresh but more hostile response to the North, and many proposals are being made to this effect. Impatient calls for "regime change" are stronger than ever, despite horrendous risks. At a minimum, there is substantial appetite for much harsher condemnations of and UN sanctions against Pyongyang, even while acknowledging that they are unlikely to be any more effective than their predecessors. Fortunately, some voices urge caution and oppose hasty overreaction, and a few wise counselors, recognizing the increasing danger of our long failure to bring the North fully into the world community, are groping for a more positive approach that might radically improve the situation. I am glad to see that both Spencer Kim and Don Gregg are among them. Of course, realistic suggestions for halting the present escalation of tensions and beginning to reverse the moribund policies of both sides are hard to come by, particularly in view of the reservoir of ill will and mistrust that has accumulated during more than six decades.
My own preference dates back to the critical year 1972 when my family and I were living in Japan. After many months of discussions with North Korean officials based in Tokyo, my wife Joan and I, together with our three middle school sons, visited the DPRK for two weeks. It was at that optimistic time, marked by the then recent Nixon-Mao Sino-American breakthrough, that the idea of a comprehensive "grand bargain" with Pyongyang first seemed conceivable. The goal then, as still today, was two-fold: first, to gradually assuage the deep sense of strategic insecurity that Pyongyang understandably harbors and the reciprocal insecurity necessarily felt by South Korea, Japan, the United States and even China vis-a-vis the fiercely independent DPRK regime; and second, to go well beyond required arms control and security arrangements by welcoming the DPRK as a full member of the world community, in politics, economics and other respects, including normal diplomatic relations with the U.S. and its allies.
That early family visit - only the third to the DPRK permitted by the United States (New York Times and Washington Post correspondents preceded us) - made it clear that the North had no Zhou Enlai to smooth the way toward dramatic reconciliation. Several visits I made to the DPRK during 1997-98, however, revealed a government much better prepared to reach out to the world, especially for economic cooperation. Also in 1998, at the invitation of the Council on Foreign Relations, where I then headed Asian affairs, the DPRK sent a small group to Washington and New York for groundbreaking business and political talks. That led to a series of training seminars in international trade and investment law for North Korean officials, but held in China, with the co-sponsorship of NYU Law School and the Asia Foundation as well as our Chinese hosts. It also led two American multinational companies to explore business transactions in Pyongyang. Yet these promising sprouts died with the end of the Clinton Administration.
I mention these previous private initiatives because private initiatives may represent the best way forward with the North at this time. I hope that, given its farsighted record and board of trustees, PCI might consider taking the lead in convening, as soon as possible, a series of Track 2 or Track 1.5 dialogues, first with China together with Japan, South Korea and the United States, and then with representatives of the DPRK as well as these other countries to explore the ingredients of a "grand dialogue." I am confident that appropriate co-sponsors can be found outside the DPRK and hope that Pyongyang will respond favorably to the prospect of such meetings, although it may insist, at least at the outset, on only a bilateral dialogue with Americans. In any event, NYU's US-Asia Law Institute would be proud to be involved.
To be sure, the obstacles to the success of a Grand Bargain with the DPRK are probably greater than ever, both in this country and in Northeast Asia. Yet it may be possible to revive the atmosphere of the final days of the Clinton Administration, the last time when a breakthrough with the DPRK seemed possible. Indeed, perhaps former President Clinton and former Secretary of State Albright can be enlisted in our endeavor.
The second and final area I want to touch upon is the crisis in the East China Sea and South China Sea concerning disputes over both territorial sovereignty and the delineation of maritime boundaries. The danger of accidental or intentional armed conflict grows daily as an increasingly nationalistic, rising China asserts its international law claims in a frighteningly muscular fashion that has incited nationalistic reactions in other contending states.
In the East China Sea, during the past three years the forceful manner of Beijing's assertions of sovereignty over the Diaoyu (Senkaku) islands has backfired. It has alienated China's neighbors and prejudiced their views about the validity of China's underlying legal claim, which on the merits may be at least as persuasive as Japan's. The United States, because of our security treaty with Japan, is especially concerned that it may be drawn into any conflict.
Beijing's similar maneuvers over island sovereignty disputes in the South China Sea have also damaged its relations with adjacent ASEAN states. But the situation there has been exacerbated by its broad invocation of and vague justifications for the so-called "nine-dash line" in order to claim jurisdiction over most of the waters of the South China Sea. That claim has aroused the anxieties of the United States, Japan, India and other maritime powers as well as those states within the region.
If these disputes are allowed to fester, the risk of armed conflicts is high. Yet how should they be settled? In principle each of the contending parties maintains that it is prepared to enter into negotiations over maritime boundaries but not over the sovereignty of islands that they occupy but that are claimed by others. The occupants of the disputed East Asian islands usually argue that there is no "dispute" and therefore nothing to negotiate about or to seek to settle by other means. This is the Japanese position about the Senkaku (Diaoyu), also claimed by China; the Chinese position about the Paracels, also claimed by Vietnam; and the South Korean position about Dokdo (Takeshima), also claimed by Japan. Failure to settle these territorial issues , however, has made the negotiation of mutually acceptable maritime boundaries more difficult.
Can these perilous territorial stalemates be broken? Of course they can if the disputants are willing to submit the claims they voice with such confidence to determination by an impartial international tribunal. That, however, is not a step that major powers take lightly, especially if the dispute involves a matter of any importance and if public opinion is inflamed. Resort to third party decision-making surrenders control over the outcome, while negotiation and conciliation do not. Confucian-influenced East Asian nations have had a traditional, cultural distrust of arbitration and adjudication in lieu of negotiation or conciliation. There is also a lingering historical suspicion that international tribunals might not give them a fair hearing because of racial considerations. In the case of Asian communist countries there is additional distrust based on ideological and political grounds. China has consistently made clear that it is not prepared to accept international adjudication or arbitration of sovereignty disputes, although for the past three decades it has posted judges to take part in the International Court of Justice.
Japan is slightly less adamant in this respect. It has expressed willingness to take its claim to Takeshima (Dokdo) to the International Court of Justice (ICJ), perhaps because it was certain that the occupant, South Korea, would refuse the challenge. Until late last year, however, it rigidly clung to the position that there can be no "dispute" over the Senkaku (Diaoyu), which Japan occupies. Then, startlingly, on the eve of his and his party's departure from office late last year, Japan's Foreign Minister Gemba, in an International Herald Tribune op-ed, challenged China to take its claim to the Senkaku to the ICJ. He boasted that Japan always supports international law and, unlike China and the United States, has accepted the ICJ's "optional protocol" requiring it to agree to engage in litigation brought by any other state that has also accepted the ICJ's compulsory jurisdiction. This appeared to suggest implicit or conditional abandonment of Japan's long-standing and increasingly indefensible position that there is no "dispute" over the Senkaku. Unfortunately, virtually no one took note of Gemba's statement, and Prime Minister Abe's new, more nationalistic, LDP government has ignored it and renewed Japan's traditional stand toward the islands.
More recently and more momentously, a genuine break in the South China Sea logjam has occurred. The Philippine Government has been jousting with China over ownership of some of the Spratly islands and other modest territorial features near its shore, as well as China's expansive claims over sea boundaries. On January 22nd, it stunned informed circles by challenging not China's territorial claims but some of its maritime claims, especially the "nine-dash line," before an arbitral tribunal authorized by the United Nations Law of the Sea Convention (UNCLOS) to which both the Philippines and China adhere. Unlike the ICJ system, under UNCLOS all state-parties by virtue of their membership agree to litigate or arbitrate maritime claims brought against them in an UNCLOS tribunal unless they can persuade the tribunal that the claims fall within certain exceptions designed to free them from this obligation. Following prescribed procedure, the Philippines accompanied its claims with a carefully-prepared brief spelling out the arbitral tribunal's jurisdiction, the basis for its claims and the identity of the arbitrator that it is entitled to appoint as one of the five arbitrators who will constitute the tribunal.
This presented China with a difficult challenge. Would it respond to the Philippine complaint by the February 21 deadline, appoint the arbitrator to which it is entitled and defend its case? Or would it thumb its nose at the proceeding and endure the condemnation of many UNCLOS members and others? Unfortunately, the People's Republic chose the latter course, criticizing the Philippines for choosing to go to arbitration rather than continuing the long and thus far fruitless sparring in which China and the ASEAN states have been engaged over developing a code of conduct for resolving their disputes.
China's spurning of the UNCLOS dispute resolution process does not end the matter, for the UNCLOS system provides for the president of its Law of the Sea Tribunal, who is currently a Japanese expert, to appoint an arbitrator on behalf of the non-responding party and, if necessary, the other three required arbitrators as well, so that the dispute can proceed to be heard even in China's absence. The case is an embarrassment not only to China but also to the United States, which has thus far shamelessly resisted all efforts to persuade it to ratify UNCLOS and take part in the system, although it purports to observe most of the UNCLOS provisions in practice.
Needless to say, I was delighted with the Philippines' daring resort to international law and disappointed, if not surprised, by China's response. In an article published last October in Hong Kong's South China Morning Post and Taiwan's China Times, I urged all the East Asian states to take their territorial and maritime boundary disputes either to the ICJ or some other international tribunal or to establish their own regional tribunal to handle these matters. The Philippine claim does not directly advance the resolution of its territorial disputes with China, but it is a major first step for all states eager to witness a rational and fair solution to the current crisis rather than one reflecting the threat or use of force.
A regional tribunal would take some time to establish but, like the ICJ and UNCLOS systems, would have an immediately beneficial effect if all the states that begin negotiations to establish it would agree at the outset to submit their claims to it, thereby diverting the claimants from their current reckless game of "chicken."
Whatever the precise path or paths chosen by the disputants, submission of all territorial and maritime disputes to an impartial third-party decision-maker will constitute progress towards a more peaceful and rules-based world rather than one where might makes right, as the Philippine Government recently noted in filing its now famous submission. This would not be the first time that international law and legal institutions come to the rescue.
Many other issues deserve the attention of this audience, including the protection of human rights in East Asia and the political and legal aspects of the Taiwan, China, U.S. relationship. Perhaps we can discuss them during the question period. Many thanks for your attention.
On Thursday, May 9th, 2013, USALI Executive Director Ira Belkin and Affiliated Fellow Maggie Lewis presented their views on Reeducation Through Labor (RETL) at the Congressional-Executive Commission on China's (CECC) Roundtable, "The End of Reeducation Through Labor? Recent Developments and the Prospects for Reform."
On Friday, October 11, USALI Co-Director Professor Jerome Cohen received the American Society of Comparative Law's Lifetime Achievement Award, in recognition of his "extensive and rich work in Chinese law." The award was given at the Society's Annual Meeting in Little Rock, Arkansas.
The American Society of Comparative Law, Inc. (ASCL) is the leading organization in the United States promoting the comparative study of law. Founded in 1951, it is a thriving organization of more than 100 institutional sponsor members, both in the United States and abroad, and a growing number of individual members. It is a member in good standing of the American Council of Learned Societies and International Association of Legal Science.
The Lifetime Achievement Award was established in 2003 to honor living senior comparatists whose writings have changed the shape or direction of American comparative or private international law. It is a “non-monetary recognition of lifetime extraordinary scholarly contributions to comparative law in the United States.” Previous awardees are Alan Watson, Distinguished Research Professor and Ernest P. Rogers Chair, University of Georgia School of Law, and Mirjan R. Damaška, Sterling Professor of Law Emeritus, Yale Law School.