China’s ruling engineers (8 out of 9)

DR. WEEKS’ COMMENT:  China, it seems, is run by engineers and demonstrates accountability (albeit ruthless at times). Gee.  Maybe we should disquality lawyers from applying for public “service”then we would get things done!

From   NEWSWEEK  by Rana Foroohar  China’s Economy Stays Out of the Red  Jan 19th 2009

…..The leadership’s faith in its own ability to mold markets may derive from the fact that most are engineers, trained to build from a plan. Eight out of the nine top party officials come from engineering backgrounds, and the practicality of their profession may also help explain why they didn’t buy into risky and Western financial innovation. At a recent Chinese business conference in Barcelona, Xu Kuangdi, vice chairman of the advisory body to China’s Parliament, and President of the Chinese Academy of Engineering, mocked the “virtual” products sold over the last decade by Western bankers: “They had Ph.D.s in physics inventing tools that the banks themselves couldn’t understand or regulate. Investors listened to their stories and were told how wonderful all this would be, how much better it was than producing real goods. Everyone was working in a dream.”

A command-and-control system run by relatively skilled technocrats allows China to get things done, quickly. “I’m always struck by the ability of the Chinese state to move in a coherent manner and to marshal its people and the resources of the country to a common target,” noted David Murphy, head of CLSA’s China Reality research division, in a recent report on the country’s efforts to bolster growth. Contrast this to Russia, where thuggish autocracy has created an “anything goes” environment in which neither investors nor most officials have any idea what might happen from one moment to the next.

The ruling engineers preside over a system that is highly process-oriented and obsessed with performance metrics. One economist who works closely with top government officials notes that many of them serve the same brand of Chateau Lafite Bordeaux at their dinner parties because of its exceptional rating by the Wine Spectator’s Robert Parker. Ambassador Wu Jianmin of the Chinese foreign ministry recalls a recent meeting with a deputy mayor from the city of Wuxi who could compare in detail his own local economy with that of the United States in the 1970s. The official was concerned about why his service sector hadn’t grown larger, given the respective per capita income growth (the town’s party secretary has since been dispatched to America to hunt for service-sector talent).

Leaders who don’t meet internal performance standards are, more often than not, held accountable, and do get sacked, which is still unusual in many developing economies. For instance, the scandal in which at least six Chinese kids died and 300,000 fell ill from toxic milk mixed with melamine to give a falsely high protein level led to the swift sacking in September of six city officials—including the mayor and party secretary—in the hometown of milk-powder maker Sanlu. China’s top food safety inspector also stepped down and the company’s chairwoman has gone to trial. Such moves seldom fully satisfy public anger but they do rattle officials.

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