New Year's Address

Constitutionalizing the Governing Ways of King Wen and King Wu
By Prof. Sheng Hong

The Nobel Prize-winning economist James Buchanan once asked, “Will there be anyone who has the motive to draft a constitution if proceeding merely from his own interest?” His answer was negative. He also believed that those who draft the constitution should have the ethics of constitutional citizenship. The Doctrine of the Mean said that, “Confucius coded the ancient traditions of Yao and Shun, and constitutionalized the governing ways of King Wen and King Wu”, which means that Confucius sorted out the public governance experiences and social norms from the age of Yao, Shun and Yu to the age of King Wen and King Wu into a set of universal basic principles, thus providing the vital constitutional framework for the development of the Chinese civilization, which is what Liang Shuming called the unwritten constitution of China. Needless to say, Confucius is one of those with the ethics of constitutional citizenship.

In today’s China, the constitutional resources of the Chinese civilization have been lost, while those outside of China have been rejected for a long time. This is the fatal problem with this society. In reality, a society without constitutional principles will not last long. This is because that, if minor principles usurp major principles, partial interests will trump the overall interests and short-term interests will trump the long-term interests, and the agent would arrogate the principal, the administrators arrogate the sovereignty, and political groups arrogate the people. The only way to avoid social break-down is constitutional reform.

Constitutional reform requires promotion by political power, and most importantly, constitutional preparations. In fact, only with a mature constitutional framework will constitutional reform be soundly carried out. This is because no political reform will be meaningful if it does not have a better constitutional framework as its political scheme, and a mature constitutional framework will help people to find peaceful solutions to conflicts when social unrest and violent changes take place during political reforms. This not only allows constitutional reform to have a smaller cost, but also allows people to accept more tolerant constitutional principles while solving conflicts and changes the confrontation among different politics into competition under constitutional frameworks.

I once said that, in comparison with the actors in the political arena, those who proposed constitutional frameworks and institutional solutions were more important; however, fewer have the motive to become this kind of person. This is exactly what the Unirule aims to do. In other words, the Unirule aims to become an organization possessing the ethics of constitutional citizenship. Constitutional preparations require lots of work, including exploiting the traditional constitutional resources of China’s own civilization, absorbing the constitutional resources of other civilizations and allowing unrestricted discussion by combining China’s history and current situations. This also has to overcome the difficulty of the intolerant environment for free expression.

Surely, in return, reforms with constitutional preparations will definitely be much better than those without constitutional preparations. The Unirule will feel rather satisfied if we can play this role.

Sheng Hong
Director, Unirule Institute of Economics

Current Events

Seminar on Classic Cases in Fights for Property Rights Held in Beijing

The Unirule Institute of Economics held the Seminar on Classic Cases in Fights for Property Rights in Beijing on Nov. 15th, 2011. Prof. Mao Yushi, Prof. Jiang Ping, Prof. Zhang Shuguang, Prof. Sheng Hong, Prof. Liu Xiaoxuan, Prof. Yang Fan, Prof. Feng Xingyuan, Prof. Zhao Nong, Prof. Shen Kui, Prof. Zheng Yefu, Prof. Mao Shoulong, Mr. Qiu Feng, Mr. Zhao Xu, and some lawyers and entrepreneurs attended the seminar. With the classic property right dispute case of Shaanxi Yulin Kaiqilai Energy Investment Co., Ltd. as the background and based on related media reports, a thorough discussion was carried out on the following topics: protection and exercise of property rights, judicial justice, and effective supervision over public power, etc. A consensus was reached at the seminar: the active protection of property rights and maintenance of judicial independence and justice to ensure the supply of high-quality public service by the government is an important prerequisite for further promoting market economic reform and safeguarding social fairness, justice and stability. The seminar appealed to the government to always bear in mind the principle of "sovereignty belonging to the people" and exercise its power within the principle framework of the constitution and constitutionalism under a market economic.

For more details:
http://english.unirule.org.cn/Html/Events/20111222105020380.html

Seminar "Land: Justice and Reform" Held in Beijing

Seminar "Land: Justice and Reform" was jointly held by the Unirule Institute of Economics, Guangdong Zhongguan Innovation Development Institute and China-Review in Beijing Dragonspring Hotel on 13th and 14th December 2011. Prof. Mao Yushi, president of the Unirule, and Chen Zhishi, member of the 10th Guangdong Provincial CPPCC and president of Zhongguan Innovation Development Institute gave the opening remarks respectively. Prof. Wang Weiguo, Prof. Zhang Shuguang, Mr. Zheng Zhenyuan, Prof. Sheng Hong, Prof. Cai Jiming, Prof. Feng Xingyuan, Prof. Liu Xiaoxuan, Prof. Mao Shoulong, Prof. Yang Fan, Mr. Zhang Lifan, Mr. Qiu Feng, Mr. Dong Yanbin, Mr. Yang Junfeng, Prof. Zhao Nong, Mr. Zhao Xu, Ms. Hua Xinmin, Ms. Ye Zi, Mr. Duan Jun and Mr. Zhang Weiyun attended the forum.

Experts attending the forum delivered speeches and carried out a heated discussion on the following topics: causes of and solutions to hotspots existing in China's property market changes and the land system reform, the root cause of the land system for China's warped property market, the legal framework to safeguard Chinese urban citizens' land property rights, how to protect urban citizens' land property rights, what sort of land-related rights do house owners have, the possibility for housing with limited property rights to be recognized, the decision-making mechanism, administration methods and ways of transformation, rural construction land and development right, the problem of private right protection existing in the process of farmers' concentrated residence and ways of improvement, land system and China's urbanization path, problems and reform ideas, Chongqing Model and Chengdu Model and comparison of domestic and foreign experiences in state administration.

The Unirule CCPPP Members Salon 2011 held in Beijing

The Unirule CCPPP (China Center for Public-Private Partnership) Members Salon 2011 was held in the conference room of the Unirule office on December 22nd, 2011. The theme of this salon was China's natural gas industry reform. Mr. Chi Guojing, member of the board of directors of CCPPP and secretary-general of China Gas Association, and Mr. Han Xiaoping, Chief Information Officer of China Energy Net, gave speeches on the current situation and prospect of the development of China's natural gas industry as keynote speakers respectively. The director, vice director and researchers of CCPPP all attended the salon.

News

Prof. Feng Xingyuan Attended the Academic Salon Held by the Prelawyer Association of CUPL
Prof. Feng Xingyuan attended the Academic Salon on Exploration of and Reflection on Wenzhou Crisis held by the Prelawyer Association of China University of Political Science and Law (CUPL) by invitation. He delivered a speech on the theme and carried out heated discussion with members of the Prelawyer Association and other students of CUPL.

Prof. Feng Xingyuan Attended the Nddaily Public Forum
Prof. Feng Xingyuan attended the Nddaily Public Forum by invitation and delivered a speech entitled "China's Development Path and Difficulties and Future Prospects Faced by Chinese SMEs" in Shenzhen on December 18th, 2011. In his opinion, regulations on private economy should be loosened, and more people should be encouraged to start an undertaking and become rich. Meanwhile, privilege in various fields, including state-owned enterprises, should be abolished. In addition, he believed that private enterprise should be given more space so that China's economy can continue to grow in the future. For one thing, more freedom for maintaining and enhancing economic activities is needed. For another, stable environment for economic operations should be maintained.

Current Researches/Consultings

Research on China's Strategy of Breaking Administrative Monopoly
State-owned enterprises have been severely criticized in recent years for their tendency to gradually expand in an existing field rather than to retreat. State-owned enterprises not only solidly occupy the non-competitive fields, but also continue to exist in the field of private goods. China's state-owned enterprise reform has now reached a new turning point after thirty years. More importantly, the problem of administrative monopoly is rather severe in China and requires urgent reform. Until this problem is fixed, there can be no fair competition between state-owned enterprises and the private sector. Unfortunately, China's administrative monopoly reform still has a long way to go. This research aims to provide a feasible plan for administrative monopoly reform and to help create a fair market environment with deepening economic reform. This research lasts for roughly half a year and has been completed by now. The initial research result will be released in early 2012.

The Special Planning of Industrial Development in Qianhai Cooperation Zone
Commissioned by the Authority of Qianhai Shenzhen-Hongkong Modern Service Industry Cooperation Zone of Shenzhen, Unirule conducted research aiming to make a full analysis of the current development status and trend of modern service industry in Guangdong-Hong Kong region, to propose a general framework and development goal of industrial development planning in Qianhai Cooperation zone, to make a detailed analysis of four major industries, to propose the major missions and key projects of the development of the four major industries and the construction plan of the supporting service system from the perspective of international cooperation, Guangdong-Hong Kong cooperation and Shenzhen-Hong Kong cooperation, and to propose relevant measures to guarantee the implementation of the industrial development planning in Qianhai Cooperation Zone.

Research on Large Enterprises in the Marketization Reform
During the process of China’s transformation from a planned economy to a market economy, the interaction of various economic subjects exerted a significant impact on China’s economic and political system and policies. As one of the major economic subjects of huge scale, large enterprises possess a strategic industrial position, large state-owned enterprises, in particular, have a historical relationship with the government and have exerted much influence on China’s social structure and development direction. This research aims at making a thorough investigation on various kinds of large enterprises, sorting out their position and influence on China’s economic operation and political activities, exploring the mechanism of this process and giving suggestions on better institutional plans and policy suggestions so that the government could work out better systems and policies which will benefit the adjustment and growth of large enterprises in the future.

Research on the Development of Social Organizations in Zhongguancun from the Perspective of Constructing World-class Scientific Innovation Centers
The State Council approved the construction of the Zhongguancun National Innovation Demonstration Zone and requested that Zhongguancun should be built into a world-class scientific innovation center. Zhongguancun has the opportunity of a new round of leapfrog development. As an organic part of the innovation activities in Zhongguancun, social organizations play a positive role in promoting the formation of innovation clusters and the supply of public services. Under the new historical circumstances, it’s of great significance to make a thorough analysis of the current development status and direction of social organizations in Zhongguancun by learning from the development experiences of social organizations in Silicon Valley so as to make suggestions on the direction and relevant measures of governmental control. Entrusted by the Administrative Committee of Zhongguancun National Innovation Demonstration Zone, this research will analyze the current status of and existing problems with social organizations in Zhongguancun, propose certain targeted, prospective and operative ideas, institutions and procedures, and give answers to a series of questions.

Research on Urban Water Supply Performance Assessment and Administration System
Entrusted by the Urban Water System Planning and Design Institute, China Academy of Urban Planning and Design, Unirule conducted research to analyze the current status of, and problems with, the assessment and administration of performance of China’s urban water supply enterprises, to introduce international experience in assessment and administration of performance of urban water supply enterprises, to propose guidelines, goals and basic principles of assessment and administration of the performance of urban water supply enterprises, to clarify the participants of assessment and administration of the performance of urban water supply enterprises and their responsibilities, and to make certain policy suggestions.

An Electricity Group's Business Planning in Water Industry
This electricity group has strong comprehensive strength in funds, investment, and project operation and management. In order to expand its investment fields, the group has decided to seize the opportunity to enter the water market and has planned for long-term cooperation with local provincial water resources department. However, due to its long history in the power industry, the group is lacking in deep understanding of the water industry. In addition, the water industry requires enormous prophase financing and sunk capital, and is weak in short-term return ability though it has consistent long-term returns. This lack of understanding makes it hard for the group to make long-term goals with regards to the water industry.

Based on a thorough analysis of the current status of the water market in local area and the advantages of this electricity group, Unirule worked out an integrated plan for this group to enter the water market, including their strategic position in the water market, the short-, medium-and long-term goals of development of their water business, segmented market strategy, entry mode and breakthrough point, selection of cooperation partners and strategic coordination, etc. This electricity group has approved this plan and is putting it into practice.

Research on Promoting Governmental Information Disclosure
In this research, a scorecard was designed to comprehensively evaluate the information disclosure status of city and county local governments. Different from the ambiguous governmental information disclosure rules and regulations, the scorecard will pay more attention to the respect and protection of the people’s right to know and right to participate. This research was launched in October 2011 and will be completed by July 2012.

Upcoming Events

Unirule Biweekly Symposiums
Unirule’s Biweekly Symposiums are known in China and throughout the world for their long history of open and in-depth discussions and exchanges of ideas in economics and other social sciences. Over 380 sessions have been held and over 15,000 scholars, policy makers, and students, as well as countless readers on the web, have directly and indirectly, and participated in the Biweekly Symposium for close to 20 years.

Biweekly Symposiums begin at 2 p.m. every other Friday and are free and open to the public.

Schedule
Biweekly Symposium No.446 : Jan. 20th, 2012
Biweekly Symposium No.447 : Feb. 17th, 2012

Previous Biweekly Symposiums

Biweekly Symposium No. 441
Time: November 11th, 2011
Topic: China’s Medical System Reform: the Division of Labor of the Government and the Market—A Preliminary Assessment of Local Medical System Reform
Lecturer: Prof. Zhu Hengpeng

Prof. Zhu Hengpeng, Prof. Yu Hui and Prof. Fu Jun made an assessment of the effectiveness of fiscal inputs in medical system reform in sixteen cities. The assessment report pointed out that most of the sixteen pilot cities did not take virtual measures and that some pilot cities which worked out certain public hospital reform schemes simply repeated the scheme of the central government. Prof. Zhu Hengpeng believed that the unsatisfying result of the medical system reform should mostly be attributed to the lack of incentive because this reform was promoted by the media and scholars while local governments, hospitals and part of the doctors were not so much enthusiastic about the reform at all. He also pointed out that the reform path of China’s public hospitals should be reviewed and that China should step out of the government-dominated reform circle so as to promote the medical system reform.

Biweekly Symposium No. 442
Time: November 25th, 2011
Topic: Transparency and China's Public Governance Reform
Lecturer: Wang Xixin

Prof. Wang Xixin elaborated the relationship between transparency and China’s public governance reform. He believed that China’s ruling party continued to promote governmental information disclosure in the hope of optimizing China’s administration. Through information disclosure, one of the administrative technologies, the public will be able to have access to information and get involved in administration of the country. Moreover, certain changes will also happen to the relative strength of the ruling party and the public. This might become a breakthrough point of China’s administrative structural adjustment. Prof. Wang also touched on several other issues, such as, the practical effects of information disclosure, what should be done in information disclosure in the future, etc.

Editor: Jiang Hong
Revisor: Jude Blanchette