Tuesday, August 4, 2009
Back in 2003, I was asked to present a paper on nonprofit organizations in China. Eager to visit Beijing, I eagerly set out to find out all I could about China's laws pertaining to charities. After all, China was in the midst of transitioning from the "iron rice bowl" to a market based economy where profits rule, social causes are subordinated to profit making and inequality is inevitable. Market economies are amoral and profit implies winners and losers. I am not prepared to disagree with Adam Smith's notion that the greedy search for individual profit is the best way to ensure the best lives for the most people. Something about each individual's selish hunt for profit generating innovation and increasing the size of the pie. But one thing is certain, in order for some to get rich, others must be poor. Charities and other nonprofit organizations are moral actors in amoral capitalist societies. They operate under the assumption that people, whatever their skill, luck, inheritance, moral qualities, etc., have a right to basic necessities of life even if they cannot afford those necessities. Charities, in short, ameliorate the ravages of capitalism. Sound socialist, I know, but ours is not and never has been an exclusively capitalist society. We have intentionally tempered our amoral (and some say immoral) focus on profit via charities that seek social justice ahead of profit.
So in my 2004 article, "The Neglected Role of International Altruistic Investment in the Chinese Transition Economy" I predicted that Chinese NGO's would not fill that admittedly westernized view of NGO's, particularly because Chinese law requires each exempt organization have a government sponsor answerable to the central government. This, in turn, implies (if it does not say so explicitly) that Chinese NGO's must operate consistently with governent policy. Recent press reports out of China confirm that logical extension. The Christian Science Monitor, for example, reports today that Chinese officials are increasingly bringing financial and criminal pressure on Chinese NGO's that take a critical view of the central government:
It began with a tax notice for $200,000. Three days later, on July 17, officials raided the group's Beijing office and seized its computers. Then, just before dawn on July 29, police detained its founder, Xu Zhiyong at his home On the same day, government officials went to the office of Yi Ren Ping, another nongovernmental organization, and confiscated copies of its newsletter on the grounds that it didn't have a publishing license. Taken together, the raids appear part of a tightening of controls on critical voices in the run-up to Oct. 1, the 60th anniversary of the founding of the People's Republic of China. The two NGOs are among a growing number here using the law to hold authorities to account on issues such as food safety, patient rights, and illegal detention. But they share another common thread: Both received grants from American and other foreign donors. The tax fine for Open Constitution Initiative, the group headed by Mr. Xu, was assessed largely on a donation from Yale Law School. Xu, a lawyer and elected legislator, is being detained on suspicion of tax evasion, according to an OCI official. The harassment of these and other foreign-funded NGOs in Beijing has raised fears of a Russian-style squeeze on civil society. Since 2006, Russia has stripped the tax-free status of many foreign foundations and forced NGOs to report their activities in exhaustive detail, while accusing foreign-funded human rights groups of being Trojan horses for Western powers. It recently amended its NGO law, easing some of these controls. An alternate view in Beijing is that the groups targeted had pushed too aggressively into forbidden political zones, setting off a reaction. NGO workers and experts on civil society say the investigations into taxes and licenses are a smokescreen for a clampdown on legal activism, including the recent disbarring of 20 civil rights lawyers in Beijing.
A recent Wall Street Journal opinion piece reports similar government efforts to shut down Chinese NGO's:
Gongmeng’s work was a rarity in a country where authorities brook little public dissent. Its lawyers represented victims of the Sanlu toxic milk powder scandal—which made nearly 300,000 babies ill—and investigated institutions like “black prisons,” which are illegal detention centers. Gongmeng researchers studied the Tibet riots last year and concluded the Tibetans were protesting because of failed government policies that threatened their way of life. Gongmeng bravely published its findings in Chinese. Like other nongovernmental organizations, Gongmeng always operated in a legal grey zone of China’s own making. It’s impossible to register an NGO without government sponsorship. So most NGOs—including Gongmeng—register as a business instead. That gives Beijing wide latitude to shutter NGOs when they start to expose real problems. Government officials removed computers and files containing sensitive client data from Gongmeng’s offices Friday. Last week the firm was slapped with a hefty $200,000 fine for tardy payment of taxes.
In my article, I even predicted that public interest lawyers would be the first to be shut down under Chinese laws regulating Chinese charities. In the westernized version, the N and the G mean "nongovernmental;" In China, charities are expected to be PGO's, "pro-gvoernmental organizations" and when they are not, they are squashed. I never did get to go to Beijing because the conference was scheduled to commence a week after the 9/11 attacks and was cancelled for fear of more terrorist attacks.