Building the Rule of Law in China

Ideas, Praxis and Institutional Design

Weidong Ji

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351613057
• Edition: 1
• Topic: Derecho
• Subtopic: Teoría y práctica del derecho

After thirty years of Mao era (1949-1979) which was struggle-based, the Communist Party of China has begun to change its position as a pioneering revolutionary party, evolving into a universal ruling party that transcends class interests. Meanwhile, administrative and judicial reforms oriented toward a more efficient, serving government and the rule of law have been actively carried out.

As the earliest work on constructive jurisprudence of new proceduralism in China, this book elaborates on the ideological confrontation on the "direction of China". It includes academic debates on politics and law which the author has been involved in, and top-level institutional design in China. Besides, this book introduces, analyzes and evaluates the focus of Chinese contemporary jurisprudence, making some critical summarizing propositions on the practical experiences. A review of Western contemporary jurisprudence and the forefront of legal research is also covered, aiming to provide ideological resources for the rule of law in China.

Scholars and students in Chinese legal and social transformation studies will be attracted by this book. Furthermore, it will help different civilizations conduct rational dialogues on justice and order.

1
The second ideological emancipation or a Utopia?

A thesis about social development models and “institutional fetishism” published by two scholars, Roberto Unger and Cui Zhiyuan, in Twenty-First Century (August 1994), raised an important issue at an extremely delicate time: how will Chinese politics and its legal system develop in the next stage of modernization, when China has established its national policy of marketization?

The starting point of Unger’s and Cui’s arguments is that “a country’s future could have various possibilities”; thus, the vision for it should not be confined to models of one-dimensional evolutionary and universalistic determinism. If Western-style modernization was seen as the only method of development, other newborn ideas would be constrained, and a pluralistic status is more conducive to institutional innovation. However, Cui grounded his arguments in two different areas – one was the recent Western academia’s New Evolutionism, Analytical Marxism, and critical legal studies, and the other was the analysis of the status quo of China. Cui arguably had good intentions of exploring China’s institutional innovation to transcend the dichotomy of capitalism and socialism by combining the latest Western theories with China’s reality. However, there exist problems concerning both the theoretical basis of his argument and his understanding of China’s national situation. If these problems have not been clarified, although ideology can certainly be emancipated, the prospect of the so-called institutional innovation is perhaps merely a mirage.

I. Basis of criticism and basic criticism

One of the theoretical bases of Cui’s institutional innovation and institutional design is “New Evolutionism.” The formation of biological traits can be explained by a creature’s natural variation and natural selection, based on the classical theory of evolution. In recent years, great progress in genetic engineering and molecular biology has made it possible to control biological traits through genetic manipulation. Cui made an analogy between biological trait control and institutional design, believing that “survival of the fittest” cannot be used to judge the old socialist system. Those systems, which seemed to be eliminated by “natural selection,” could perhaps reproduce their rational factors after self-reference and institutional innovation. Arguably, the biggest problem in Cui’s theory does not lie in whether natural science can be applied to (or make an analogy of) social research (in many cases, it arguably can be applied), but that the problems faced by the New Evolutionism are totally different from the social system research.

The fact that gene recombination can be used to control biological traits and thus transcend natural selection determinism has a premise that in recent years the relationship between biological traits and genes has received a thorough, comprehensive, and even reductionist understanding. However, the conclusion drawn by human experience in the 20th century seemed to be contrary to the aforementioned developments in biology as to whether a social institution with too many variables as a whole could be artificially designed. A socialist planned economy was originally designed based on the holistic theory of some sort of evolutionism. The negations of Stalin’s socialist pattern and planned economy in the late 20th century have largely proved that Karl Popper’s criticism of the so-called utopian social engineering was justified.

Although it is erroneous to argue that China’s various existing systems could not be redesigned or combined, however, to date, it remains for us to distinguish the institutional design under a planned system using utopian social engineering. In fact, how institutional design should be viewed in the process of social rationalization and modernization is a controversial issue. In the early 19th century, with the tide of modernization sweeping Germany, the proposal of codifying in accordance with the theory of natural law to promote society to transfer from a status system to a free economy system emerged and became increasingly popular. However, the historical school of law, led by Friedrich Carl von Savigny, firmly opposed, and eventually blocked, efforts toward the instant success of legalization at that time. The school seemed to argue that law, like grass and trees in the wilderness, could grow without any toil; thus, legislation was not necessary. However, in fact, they were emphasizing that before the formation of a well-thought-out theoretical system, the work of institutional design should not hastily begin. As a result, it took 39 years for Friedrich Carl von Savigny to complete the theoretical systematic study of Roman law after he stopped the legislation and waited 50 years or so to witness Germany’s large-scale codification. During that time, many people severely criticized Savigny’s conservatism and fogyism, even Hegel was quite impatient. However, Savigny had his own reasons. His criticism of the legislation was out of fear of the abrupt transformation of the legal system; conversely, it was also out of a sense of wariness about the social situation that would be fixed by legislation in accordance with the incomplete natural law theory.¹ Obviously, he was not to find the essence of folk law from local experience, but to combine the digestia jurisprudence system with social reality to enable people to conduct “concept computation” intuitively. This is the reason why Savigny is called the ‘Father of Modern Private Law.’ Germany’s experience reminds us that we cannot be more careful when we talk so much about grand institutional designs, such as “formulating economic plans” and “formulating political plans.”

Cui’s second theoretical basis is Analytical Marxism. However, his application of Analytical Marxism is to be questioned. For example, concepts such as “capital organic structure” are built on the basis of the labor theory of value. However, as Das Kapital’s labor theory of value has been severely criticized by modern economics, it can be questioned whether concepts such as “capital organic structure” can still be used simply. Cui thought that the biggest illumination of Analytical Marxism was to get rid of Technological Determinism, as it advocated that productive forces did not correspond one to one with production relations, and one form of advanced production technology can have a variety of systems cooperating with it. For Marxists in China, it has long been a common sense, as early as Mao Zedong objecting to Technological Determinism. It could be difficult for China’s institutional innovation today to form a theoretical consensus through this simplistic reinterpretation of Marxism.

Cui’s third theoretical basis is Law of Criticism, which arguably contains the most solid argument and is the most creative part. Law of Criticism is a rather popular topic in Western academia, which has two basic characteristics. The first characteristic is that it is rooted in the historical traditions and realities of Western law, especially American law. The second is that its criticalness outweighs its constructiveness. For American society, whose legal system is becoming increasingly cumbersome, litigation is running rampant, and legitimacy of the rule by law is in danger, a direction of reflection with great vitality has been formed by the Law of Criticism. However, it should not be forgotten that the premise of this criticism is the tradition of regarding rule by law as right and proper in the modern Western world. Once removed from the Western context and reality, and looking at China, where legal systems are still imperfect, it is rather doubtful that the Law of Criticism could have a guiding influence on the practice of the legal system. Indeed, the setback of the “law and society” movement in the mid-1970s has declared the end of the universal concept of modern Western regimes. This means that industrialized countries have lost the ultimate basis of values and orders, and non-Western developing countries have lost the unified and clear objectives of institutional reform and construction. However, at the same time, it should be noted that modernization, whether in the East or the West, has the same basic structure. As for China, the common features of modern society should not be forgotten when discussing the differences in political models in different cultural societies. In addition, full attention should be paid to those universal institutions and effective experiences formed in the process of Western modernization. Therefore, modernization can be regarded as the largest experiment in human history. When considering experimental democracy and institutional innovation, we must seriously study the formation and development processes of various institutions of the modern West, analyze the contents to find out which parts could be universally applied and which parts could not, and discover how each part was eliminated, deformed, saved, and transformed by comparing different countries’ practices in introducing modern Western institutions. Only then can we choose the right path and better institutional form in a larger space that is comparable and selectable.

II. Does China adore or despise institutions?

Cui put forward the concept of “the second ideological emancipation” based on the thought that “institutional fetishism” prevails in China now. Instead of providing the exact definition of “institutional fetishism,” Cui gave it the following meanings: a) it was inherent, inevitable, and universal to have superstition in a certain form of institution; b) it was based on elite’s self-interest and people’s blind faith in them; c) it was the political model repeatedly conducting structural changes based on the principle of self-organization that existed as the counter proposition of “institutional fetishism.” Thus institutions could only use the specific arrangements under the specific historical conditions. Cui believed that “institutional fetishism” was already or would hinder our understanding of the examples of institutional innovations taking place in China (by citing different views on the “shareholding cooperative system” and the election of a villager committee). However, China does not have to apply the concept of “institutional fetishism,” even under Cui’s understanding of it. What hinders China’s institutional innovation is that it despises, rather than adores, institutions.

In political science, institution is the stereotyped product of people’s behavior, and its essence lies in the predictability of behaviors. Therefore, if the iterations of behavior in accordance with a considerable degree of regularity on a factual level are opposed, while only the infinite possibilities of changes in behavior are blindly emphasized, then, essentially, it is the institution itself, rather than “institutional fetishism,” that is denied. It should be pointed out that emphasizing the certainty of institutions does not mean adhering to the thinking method of determinism. The importance of the probability of phenomenon should be acknowledged, but the importance of the non-randomized treatment through public selection should be focused upon. Unger’s and Cui’s intentions should not be mistaken for encouraging people to follow their own inclinations and ignore institutions. They intended to emphasize the variability and diversified choices of institutions, at the same time advocating that institutions alone should not be firmly depended upon. It must be pointed out that the institution Unger and Cui mentioned referred to the system in the modern Western legal framework. However, it could be easily noted by looking back in history that the predictability of behavior in traditional Chinese society was built from top to bottom in an orderly manner on the Rule of Li. In addition, the basis of the predictability of Chinese people’s behaviors after 1949 was the ideological identity that clearly distinguished the left from the right. Apparently, neither the Rule of Li nor ideological identity is the basis of the predictability of behavior required by modernization, which is to say that China lacks a kind of institutional awareness that is built on the modern market economy and becomes the constraint of the predictability of free individuals’ behavior.

The Critical Legal Studies Movement’s criticism of institutionalism and determinism, which was vigorously promoted by left-wing scholars such as Unger, pointed directly to the idea of a country under the rule of law. Therefore, the lineage of the idea of “institutional fetishism here” could date back to Marx’s views on a “jurisprudential world outlook,” the substitute of a “theological world outlook,” Antonio Gramsci’s “cultural hegemony” concept on governance, and realist jurist Jerome N. Frank’s disclosure of the myth of law. The scholars of Law of Criticism considered the modern Western legal system as a belief system that weakened people’s desire for reform and made them acknowledge the permanence of the existing order.² To understand the legal system as a political process in their new legal concept might be meaningful to the American society, which puts a lot of emphasis on law. However, as for Chinese society, which has a powerful tradition of the Rule of Li and an ideological identity, and continues to combine law with politics, it does not elicit many new ideas.

In fact, the spiritual tradition of virtuous people under a benevolent system of rule has shadowed China for thousands of years; there is, therefore, not much room left for holy law and institutional worship. The lineage and geographical relations are often more powerful than national institutions among the general public. For decades, two trends, de-legitimization and anti-legalization, have dominated society jointly, and most efforts to create an institution have been interrupted by endless political movements. After the floods of “breaking through the cumbersome rules and regulations” and “smashing the public security organs, prosecutorial organs, and people’s courts,” is it necessary to be unduly worried about “institutional fetishism” when a new institution that is intended to be built has not been built yet? Only by feeling the pulse first can the remedy to the case be identified. China’s problem is not its unfailing faith in the prevalent institutional forms of the rule of law but rather its unfailing faith in the pattern of different sequences that are disparate and variable; and not its blindly following of the technical elite group that promotes modernization, but its failing to effectively form the reasonable structure and social prestige of such an elite group. These are all reasons why China’s several modernization efforts were done by halves and why it could only criticize and damage the old system instead of successfully establishing new ones. Chinese people have been accustomed to someone’s certain charisma, which is the biggest obstacle to institutional construction.

In China’s closed environment, which has both a strong “Celestial Empire psychology” and a strong “reversion trend,” putting eyes on the outside world could expand the imaginary space of institutional complementarity and innovation. In this way, a minor influence of “institutional fetishism” as a form of motivation does not matter at all.

III. Behind the institutional innovation

China’s reality constituted another level of Unger’s and Cui’s argumentation. They attached great importance to China’s ongoing reform and selected instances with Chinese characteristics as the foundation of its institutional innovation. However, China’s reality should not only be analyzed as to how it appears on the surface; the essence of these instances should also be analyzed deeply as well as the promoting mechanism behind them, or the instances might be mistaken and misused. There are many such questionable examples in Cui’s article, such as the “shareholding cooperative system” he mentioned. It is acknowledged that under the existing conditions in rural China, the “shareholding cooperative system” has significant practical effects on farmers and restructuring the relations of family enterprises. However, according to an investigative report, there are no essential differences between the specific composition of the “shareholding cooperative system” and the compound partnership form of “capital shares” and “identity shares” that appeared in the late Qing Dynasty. As a modern enterprise system, stock cooperatives belong to the legal category of ‘unlimited company’ (general partnership and company partnership), and some are similar to joint ventures (partnership in commendam, limited partnership) composed jointly by managing partners with unlimited liability and investors with limited liability. Although such kinds of companies use the expression “share” (holdings), it is radically different from a joint-stock company. Cui understood the “shareholding cooperative system” by combining unlimited companies, or joint ventures, with joint-stock companies. He even seemed to regard stock cooperatives as a new form of joint-stock company, which represented the direction of development of enterprise organizations. It is certain that although stock cooperatives could gradually be transformed into joint-stock companies, they could not be directly equated with joint-stock companies with the same kind of characteristics. As for the combination of a cooperative system and a shareholding system, further consideration is needed. The cooperative system and shareholding system are two basic ways of sharing property. In the former, all owners have their respective rights of the property as a whole, and in the latter, shareholders own parts of rights, according to their shareholding ratios. Their institutional logics, operation modes, and imputation mechanisms are all very different. In Britain, the combination of these two systems was considered a long time ago in order to improve the operating conditions of enterprises with rather strong state-owned characters (such as the British Petroleum Company). The conclusion was that it was possible but not necessary.³ This was because the implementation of the combination of ownership and management, and the “one person, one vote” democratic management to part of the property, while separating ownership and management in accordance with the principles of the shareholding system and allowing the professional management of the business elite in the other part, might not necessarily take into account both economic democracy and economic benefits. Legal researchers tend to assume the worst possibility. For instance, if the investment fails, and then the company is involved in debt and sued, to what extent shall the liability of satisfaction be held accountable? Is it to make people participating in the democratic management bear joint and unlimited liability for a manager’s mistakes or to force creditors to implement a private remedy to the collective public shares? If only limited liability is born, then characteristics of a cooperative system are bound to disappear. “Limit...

Table of contents

• Cover
• Title
• Copyright
• Contents
• List of tables
• Preface to the English translation
• Preface to the first Chinese edition
• Foreword
• 1 The second ideological emancipation or a Utopia?
• 2 On the innovation and transplantation of institutions and its self-organization
• 3 The considerations and a mistake of critics
• 4 Organism and liberty: the paradox of Hayek’s rule of law (a discussion with Prof. Deng Zhenglai about spontaneous order)
• 5 The wisdom and prejudice of Carl Schmitt’s constitutional theory
• 6 On two analytical frameworks provided for the debate of jurisprudence
• 7 Definite uncertainties and the grand design of the legal system in China
• 8 The judicial reform in China: the status quo and future directions
• 9 To implement the rule of law through “the system of three kinds of review”
• 10 Legal mode of social transformation
• 11 Tradition and innovation of legal order
• 12 Conditions for modern rule of law
• 13 The roots of law and its efficacy
• 14 Institutional combinations between “sollen” and “actuality”
• 15 Efficiency-seeking jurisprudence
• 16 The quantitative analysis and prediction of changes in law
• 17 The rule of private law and economic development
• 18 Reflections on relational contract theory
• 19 The status and role of parties in action inside and outside of court
• 20 Law and society geared to the 21st century: reflections on the 31st session of the symposium of the research committee on the sociology of law of the international sociological association
• Epilogue to the enlarged Chinese edition
• Index