Tuesday, January 31, 2023

New Discussion Draft Posted: "Chinese State-Owned Companies and Investment in Latin America and Europe"

 

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I take this opportunity to let people know that I have posted a new discussion draft, "Chinese State-Owned Companies and Investment in Latin America and Europe." The abstract describes its objetives:

The Chinese state owned enterprise (CSOE) presents an anomaly in the operation of the well-ordered construction of a self-referencing and closed system of liberal democratic internationalism, especially as that system touches on business responsibilities under national and international human rights and environmental law and markets driven norms. The anomaly is sourced in the increasingly distinct and autonomous framework principles within which it is possible to develop conduct based systems respectful of both human and environmental rights which is emerging as between liberal democratic and Marxist-Leninist systems. This essay considers the forms and manifestations of these disjunctions where CSOEs are used as vehicles for the projection of Chinese economic activity beyond its borders. The essay first situates the CSOE within the political ideology of its home state. The CSOE cannot be understood except as a specific expression of that ideology suited to the times and the context in which it operated. The essay then examines the outward projection of the CSOE national model. To that end the essay focuses on the formal structures for CSOE surveillance by state organs that operationalize the guiding ideology through which they are conceived and operated. This provides the basis for a deeper consideration of the way that the projection of CSOEs abroad is structured within a conceptual cage of policy objectives: specifically the Belt & Road Initiative and emerging conceptions of socialist human rights, including environmental rights and obligations, as these are manifested when CSOEs operate abroad. The focus is on the development of conceptions of risk in that context guiding decisions about the conduct of economic activity. The essay concludes with a suggestion of the greater rift between Marxist-Leninist and liberal democratic approaches—the differences in embracing risk models grounded in prevent-mitigate-remedy strategies.
The analysis centers political ideology and its formal expression through law, regulation, guidance, and operational supervision (theory does matter in this context, perhaps a lot). Nonetheless, at its core, the study is about risk--its ideology and the way it is expressed through governance expectations and principles. One speaks here about legal risk (to align the discussion with the 1st Pillar of the UN Guiding Principles), but also of business risk (aligning the markets driven, private law structures of the UNGP 2nd Pillar).

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More importantly, the sort of risk that one encounters here, in comparing the liberal democratic and Marxist-Leninist models of human rights and sustainability, is intimately tied to the principle of "prevent-mitigate-remedy, and its administrative-compliance overlay.  In a sense, when one speaks to human rights and sustainability, and especially climate change, one is using the  qualitative language of rights to speak to the quantitative probabilities of risk of harm, and more importantly risk of irremediable harm. The function of those principles, then, framed through the prevent-mitigate-remedy principle is to provide a formula for valuing those risks, and for placing them within a hierarchy of risk tolerance. Increasingly in liberal democratic regimes, risk tolerance for strategies that do not privilege prevention (and then mitigation and last remedy) are reduced, or in some cases, risk aversion is implicitly or explicitly the result of the application of the "principles" analysis.  That is fair enough and represents the culmination of conversation about value choices.  Nonetheless, Marxist-Leninist systems approach risk, and risk tolerance in a different way.  That difference is in part a function of differences in the conceptualization of both human rights and sustainability as a function of development and collective prosperity. But it is also in part a reflection, effectively, of what might be preferences for mitigation-remediation (or otherwise exit if the costs of prevention exceed the anticipated vale of an activity), at least indifference as between the strategies as a function of expected value. That poses some challenges for any project that seeks global consensus on  what had once been the unchallenged valuations and framework of liberal democracy.   

The Abstract, Introduction and Conclusion follow. The text of the draft may be accessed HERE. Engagement always welcome as this moves from draft tp more finished versions. 

 

Saturday, January 28, 2023

The Conundrums of Current Iterations of ESG in Market Economies--Utah et al v. Walsh: Challenging the Biden Administration's Rulemaking Incorporating of Certain ESG Factors in Pension Investment Decisions

 

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ESG, has been driven by the private sector and intensely debated in the context of privately ordered responsible business conduct standards, and formed part of a rich debates among market actors and public international organizations about the role and nature of so-called non-financial siclosure in genmeral, and sustainability and climate related factors in decision making. The idea has been that consideration of these factors could substantially change the way that businesses approach value maximizing deciswions by giving value to these non-financial factors.   

Over the past few years, massive asset managers and financial institutions have increasingly focused on prioritizing ESG factors when making key investment decisions. They have particularly set their sights on investing in companies based on those companies' efforts to combat climate change and curb their carbon footprints.Companies like BlackRock, State Street and Vanguard, which collectively manage trillions of dollars in assets, have taken lead roles in the ESG movement. (25 states hit Biden admin with lawsuit over climate action targeting Americans' retirement savings)

The problem, however, has always been the reluctance to embed these within financial disclosure regimes and to preserve their role as qualitative risk factors. The move to metrics has produced additional challenges.

Regarding ESG metrics, there is a strong argument that the quality and reliability of ESG metrics need to improve. The role of ESG metrics as a proxy of sustainability performance is highly prominent in empirical studies in the SRI performance theme. However, there are two main measurement problems with ESG metrics: lack of transparency and lack of consistency or convergence. (A Systematic Literature Review of Socially Reposnible Investing (SRI) and Environmental Social Givernnace (ESG), p- 25).

On the other hand, for the World Bank Groups Internaitonal Finance Corporation, "ESG Standards comprise the Performance Standards, which define clients' responsibilities for managing their environmental and social risks, and the Corporate Governance Methodology, which sets out an approach to evaluate and improve the corporate governance of clients." (IFC, Environmental, Social, and Governance).

The goal oriented policy objectives of ESG have also been underscored by the OECD, one that seeks to recionceive the traditional focus on value maximization grounded in traditional financial analysis to  a more generalized set of public objectives toward which economic actoivity can contribute, on e in which the markers of financial value are made more a function of public good objectives. 

While noteworthy progress has been made, considerable challenges hinder the efficient mobilisation of capital to support ESG and climate-related objectives. Greater comparability of climate transition methodologies, as well as transparency and interpretability of climate finance and ESG metrics are urgently needed. In response to the rapid growth of market practices with respect to ESG investing to assess and manage climate transition risks in financial markets, the OECD Committee on Financial Markets (CMF) has developed a substantive body of work that provides analysis on challenges with respect to current market practices, and proposes policy considerations to improve them (OECD, Policy guidance on market practices to strengthen ESG investing and finance a climate transition. p. 7)

ESG initiatives have been tied to the UN Sustainability Development Goals and its 2030 Agenda. It has also become a focus of shareholder actions within enterprises, and regulatory programs in the US federal government.

ESG breakthroughs last year included a surge in shareholder proposals meant to pressure corporations to do better on climate, diversity and similar topics. Meanwhile, the Securities and Exchange Commission unveiled a slew of guidance and rule proposals to improve disclosures and add clarity to ESG investing, including the agency’s controversial proposal for climate risk disclosure. (Investors defend ESG ‘materiality’ in expectation of more attacks).

More recently it has become lumped together with a host of what opponents call an ideological push to transform society in all sorts of ways--and that has in turn produced an increasingly vocal and organized resistance. It has now also become a focus of politics, one with increasing importance. "EU rules require large companies and listed companies to publish regular reports on the social and environmental risks they face, and on how their activities impact people and the environment."  (EU Corporate sustainability reporting (disclosure touches on environmental matters; social and employee aspects; respect for human rights; anti-corruption and bribery issues; diversity on board of directors)). 

The emergence of ESG narratives and methodologies has generated reaction--not only in the economic but in the political sphere as well. ESG has been increasingly treated as an ideological movement the object of which is the erosion  of a key element of core objectives in the economic sector. That assault is undertaken through sideways strategies, ESG included, that seeks to transform purpose by changing the focus of fiduciary duty (and director discretion in decision making), and by adding categories of risk into decision-making analytics. Even if the traditional core purpose of economic activity, to maximize the value of the economic value of collective activity, is retained, its meaning and the factors that must be considered can substantially change the environment in which decisions are made and analytics are fashioned. The core concept of value maximization, remains highly relevant. It was nicely summarized, even in an environment friendly to ESG analytics, in instruments such as the Santiago Principles (Principle 19: "The SWF’s investment decisions should aim to maximize risk-adjusted financial returns in a manner consistent with its investment policy, and based on economic and financial grounds."). And in this form the concept of value maximization serves political ends in transnational spaces. It underlines the strong connection between purpose, concepts of maximization, and the protections of markets as the driving force of economic activity (around which states serve to protect their own interests through regulation and the protection of a level playing field in which they shed their political advantage when they enter the market (and the market distinguishes between between public (political) and private (economic) activity on the basis of some sort of value maximization theory based on financial, rather than social, governance or other criteria. 

Yet ESG is still in search of a disciplinary maturity. Issues of consensus, scalability, quantification, and comparability remain unresolved.  The marketplace for ESG modalities is vigorous. Its anchoring in qualitative analytics and risk analysis produces a temptation for speculation that can be used to advance strategic agendas. No one has been particularly shy about trumpeting these background objectives.  Yet risk based analysis produces it own problems. The issue emerges from the essential political ideology of risk in economic activity.  The thrust of much public policy over the last century has been both to unearth, but also to constrain risk and risk taking.  Prevent-mitigate-and remedy strategies, for example, suggest a preference for risk aversion.  The state and its instrumentalities tend to be risk averse--the essence of the ideology of compliance based governmentality.  However, the ideology of risk taking in markets based economies had, at least in its inception, been grounded on notions of facilitating, and in some respects (eg asset partitioning) encouraging risk. Risk taking is an essential feature of the value of capital and labor pooling to achieve value growth.  The state, then, in a markets privileging environment is caught on the horns of potentially incompatible objectives: the convergence of economic and administrative collectives around notions of compliance and state duty; or the promotion of risk taking in economic ventures to create prosperity and enhance the production of value that can then be tapped for all kinds of purposes.  Conundrum follows--yet most participants in the chattering about this remain blissfully oblivious to the analytics of that conundrum.

It ought to surprise few people, then, that in this anarchic and dynamic environment, the concept of value maximization, its meaning, and its relevance remains hotly contested, sometimes as part of the debate about corporate purpose (see Brief Thoughts on Martin Lipton: "ESG, Stakeholder Governance, and the Duty of the Corporation" (Harvard Law School Forum on Corporate Governance). That aligns with the continued robustness of the core principles of globalization based on idea of a level playing field in which states have a duty to enhance value in the macro community, while economic enterprises have a micro obligation of value enhancement (mindful of business, legal, and financial risk) toward its community of investors or in some instances for the enhancement of its value as a going concern (discussed here).  The investment industry has tried to push back, "pressing the importance of environmental, social and governance considerations in U.S. financial markets ahead of an expected pushback from Republican Party aligned officials as they take control of the House. Firms and funds with acute interest in ESG are adamant that issues such as climate change and human capital management are financially material, albeit non-traditional, issues. The fight against ESG may even add to the growing body of evidence that such factors are critical to investors, according to some." (Investors defend ESG ‘materiality’ in expectation of more attacks).

It has also taken a turn toward law. In late 2022sit was reported that some influential senators threatened to use their oversight powers to consider the implications under US antitrust laws, of the development of ESG reporting and decision making modalities (Senate Republicans warn U.S. law firms over ESG advice). 

The senators cited a "collusive effort to restrict the supply of coal, oil, and gas, which is driving up energy costs across the globe and empowering America’s adversaries abroad." They said Congress would refer anticompetitive actions made in the name of ESG to federal antitrust authorities and told the firms they have a duty to inform clients of such regulatory risks. (Ibud.).

More recently 25 State Attorney's General have recently filed a lawsuit challenging a Biden Administration effort to incorporate ESG in Pension fund investment decision making. The Press Release issued by the Attorney General of Virginia nicely summarizes the action and its rationale:

Attorney General Jason Miyares filed a lawsuit alongside 24 other state attorneys general challenging a Department of Labor rule which would affect the retirement accounts of millions of people. The rule would allow 401(k) managers to direct their clients’ money to ESG (Environmental Social Governance) investments and runs contrary to existing rules and the Employee Retirement Income Security Act of 1974 (ERISA). 

The new rule, “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights,” will take effect on January 30, 2023. Two-thirds of the U.S. population’s retirement savings accounts would be affected, totaling $12 trillion in assets. Strict laws placed in ERISA are intended to protect retirement savings from unnecessary risk. 

“The Biden Administration continues to use other people’s money to achieve its political goals. Virginia families have worked hard to build their retirement accounts. The federal government should be protecting that money, not putting it at risk to support the progressive ESG agenda. But this new rule—created by an unelected and unaccountable bureaucracy without input from Congress or the American people—puts progressive politics above Virginians’ financial wellbeing and security. It is another unilateral and illegal power grab by the Biden Administration,” said Attorney General Miyares.  

From the complaint: “[T]he 2022 Investment Duties Rule makes changes that authorize fiduciaries to consider and promote “nonpecuniary benefits” when making investment decisions. ... Contrary to Congress’s clear intent, these changes make it easier for fiduciaries to act with mixed motives. They also make it harder for beneficiaries to police such conduct.” 

The complaint may be accessed here and below.

 

Friday, January 27, 2023

‘Regulation of State-Controlled Enterprises' - Hybrid Book launch Event; University College London, 10 February 2023

 


 I am delighted to invite interested people to attend the book launch of Regulation of State-Controlled Enterprises:An Interdisciplinary and Comparative Examination (Julien Chaisse, Jędrzej Górski, and Dini Sejko (eds); Singapore, Springer, 2022).

This book analyses actual and potential normative (whether legislative or contractual) conflicts and complex transnational disputes related to state-controlled enterprises (SCEs) operations and how they are interwoven with the problem of foreign direct investment. Moreover, SCEs also fall within the remit of international political economy, international economics and other SCE-related fields that go beyond purely legal or regulatory matters. In this connection, research on such economic and political determinants of SCE’s operations greatly informs and supplements the state of knowledge on how to best regulate cross-border aspects of SCE’s and is also be covered in this book.

The Book Launch event will be organized in hybrid form with some speakers present in person and some attending online via Zoom.

In person attendance: Denys Holland Lecture Theatre, Bentham House, Endsleigh Gardens, London WC1H 0EG.

Online attendance: You will receive a Zoom link via email before the event. REGISTER HERE.

Those participating include:  Dr Alessandro Spano, Lecturer in Chinese Law and Co-Director, UCL China Centre (Chair); Prof Leila Choukroune, Professor of International Law and Director of the University of Portsmouth Thematic Area in Democratic Citizenship (Co-Chair);Prof Larry Catá Backer, Professor of Law, Pennsylvania State University; Mr Ji Ma, Research Associate, China, Law and Development Project at Oxford University;Prof Julien Chaisse, Professor of Law, City University of Hong Kong (CityU);Dr Dini Sejko, Research Associate, Centre for Comparative and Transnational Law at the Chinese University of Hong Kong.

Hope you will be able to attend. More information about the book follows below. 

Thursday, January 26, 2023

The Costs of Financing Arms Sales--Norway Pension Fund Global Excludes AviChina Industry & Technology Co and Bharat Electronics Ltd.

 

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In a recent press release, the Norwegian Pension Fund Global announced two interesting exclusions from their investment universe:
Following recommendations by the Council on Ethics, Norges Bank today announced the exclusion of the companies AviChina Industry & Technology Co and Bharat Electronics Ltd.
The companies were excluded due to an unacceptable risk that the companies sell arms to a state that uses them in ways that constitute serious and systematic violations of international humanitarian law.
The background for this recommendation is the companies’ sale of arms to the Government of Myanmar.
Please find the Council’s recommendation below.

Council’s recommendation to exclude AviChina Industry & Technology Co
Council’s recommendation to exclude Bharat Electronics Ltd.

In both cases the Council (and thereafter Norges Bank) drew a red line that they actually refused to cross: "the Council takes the position that anyone selling weapons to Myanmar since 2018 should have understood that they could be used in violation of international law." (Bharat Electronics Ltd.; AviChina Industry & Technology Co).

AviChina is a Chinese company that engages in the development and sale of aircraft and aviation products. In December 2021, several light combat aircrafts, of the type K-8, were delivered to the armed forced in Myanmar. The aircrafts are thought to have been produced by a company AviChina controls. It has been reported that such aircrafts have previously been used in combat in Myanmar.

BEL is an Indian producer of aviation and defence electronics. In July 2021, BEL delivered a remote-controlled weapons station to Myanmar. This weapons station has been developed to remotely control weapons from inside an armoured vehicle. It is reported that such vehicles are used in attacks on civilians in Myanmar.

The Council continues to apply a broad foreseeability standard that is grounded on their own interpretation of conclusions that can be gleaned from their investigation and assessed against their "reasonable company" standard: " With respect to the company’s knowledge of the weapons’ use, the Ethics Commission’s report states that it must be possible “with a reasonable degree of certainty to substantiate that the company had knowledge of or should have been able to foresee use that constitutes a violation of international humanitarian law” (Recommendation to exclude Bharat Electronics Ltd from investment by the Norwegian Government Pension Fund Global (GPFG), p. 3). The rationale for this standard is also equally straightforward and grounded in the policy choices that the Norwegian state has made as implemented through their global financing instrumentality: "In keeping with the ethical guidelines as a whole, exclusion under this criterion is not intended to punish companies but to sever the GPFG’s association with unacceptable conditions that are ongoing or may occur in the future. In other words, the decisive factor is the risk of norm violations forward in time." (Recommendation to exclude AviChina Industry & Technology Co Ltd from investment by the Norwegian Government Pension Fund Global (GPFG), p. 3).

Also interesting is the categorical analysis; assessment is based on the potential for a particular class of product to be used militarily, rather than based on an assessment either of intent or of effect (actual use)

The first question in this case is whether the K-8 aircraft is a weapon encompassed by the criterion. Since such aircraft can be used in combat and it has been reported that such planes have previously been used in this way, the Council concludes that the aircraft does fall within the scope of the criterion. The damage potential is substantial and attacks made using this type of aircraft could impact civilians. (Recommendation to exclude AviChina Industry & Technology Co Ltd from investment by the Norwegian Government Pension Fund Global (GPFG), p. 6).

The first question in this case is whether a remote-controlled weapons station (RCWS) is a weapon encompassed by the criterion. The product is not, in and of itself, a weapon. However, it is an item of military equipment that is also encompassed by the criterion. The RCWS may be installed in armoured vehicles, which are known to be used against civilians in Myanmar. The Council notes that this was a one-off delivery. (Recommendation to exclude Bharat Electronics Ltd from investment by the Norwegian Government Pension Fund Global (GPFG), p. 6)

Wednesday, January 25, 2023

Invitation to Virtually Attend Lecture: Keren Wang, "Social and Moral Engineering in the Age of Big Data: Personalized 'Pillars of Shame' and the Chinese Social Credit System"

 



 It is my great pleasure to pass along the announcement of what is going to be a fantastic lecture by my colleague, friend and former student, Keren Wang, now an ACLS Post-Doctoral Fellow at Emory University (Atlanta, Georgia USA).  The lecture, "Social and Moral Engineering in the Age of Big Data: Personalized 'Pillars of Shame' and the Chinese Social Credit System" examines one of the most sensitive areas of legal development--the transformation of the modalities and language of law from text to symbolic action, and its enforcement from an administrative task exogenous to the act, to the development of systems of governmentality (the governance of modes of thought in this case) grounded in quantification and nudging strategies that internalize compliance.  The way that traditional textual-qualitative-exogenous legalities will be aligned with symbolic-quantitative-endogenous legalities will reshape our understanding of law for some time to come.

The specific focus in this case is China and its  pioneering work in this context organized within regimes we have come to label generically Social Credit. 

The construction of the Chinese Social Credit System (SCS) represents one of the most ambitious social engineering projects in post-Mao China. It is also arguably the most significant governance-by-data experiment thus far in the 21st Century. This lecture explores the ways in which the SCS project was prompted by a ritual impulse to inculcate Chinese social moral character in the big data age.

The lecture will take place Monday 6 February 2023 from 7.00 to 8.00 PM (US East Coast Time) and may be accessed via ZOOM:

https://emory.zoom.us/j/94409772969 

 The lecture is sponsored by the Department of Russian and East Asian Languages and Cultures (REALC) at Emory University, an interdisciplinary department dedicated to the study of languages and cultures in the geographic continuum from Eastern Europe through Eastern Asia. It is the first of this semester's Faculty Spotlight Lecture Series.

I hope you will consider attending.

Tuesday, January 24, 2023

Instruments in the Marketplace of Liberal Democratic Multilateralism: Brief Thoughts on Stewart Patrick, "Four Contending U.S. Approaches to Multilateralism"

 

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 The narrative, carefully cultivated in the United States and even more carefully cultivated by on set of factions of the leading forces of American collective society, is that the period between 2016-2020 was some sort of aberration and that the correction gloriously brought forth by the voting choices of a bare majority of those participating in the 2020 American presidential election, has set to rights the otherwise well tended course of American engagement in the world.  

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It is, if nothing else, comforting. And to the extent that there was a correction from the crude boorishness of communication during those years (expressed in brutalist style text and policy) to the more refined Neo-classical style of post -1945 American discursive and policy engagement, the forms of discourse and policy have again assumed an outward appearance more in keeping with the expected forms of politesse among stakeholders in the international community. Nonetheless, it remains unclear whether the forms of engagement continue to mask an affirmation of precisely many of those products of that brutalism and many of the fundamental re-orienting frameworks that were so boorishly rolled out  after 2016. And, indeed, the even more interesting question is one of continuity--that the manufacturing of the narrative of aberration and break between 2016 and 2020, and the return to Neo-classicism  actually serves to mask a strategic set of continuity choices of trajectories of choices with respect to which the political climate before 2016 made substantially harder to advance.

The Biden Administration National Security Strategy (October 2022) made this later point somewhat clearer:

Our goal is clear—we want a free, open, prosperous, and secure international order. We seek an order that is free in that it allows people to enjoy their basic, universal rights and freedoms. It is open in that it provides all nations that sign up to these principles an opportunity to participate in, and have a role in shaping, the rules. It is prosperous in that it empowers all nations to continually raise the standard of living for their citizens. And secure, in that it is free from aggression, coercion and intimidation.
Achieving this goal requires three lines of effort. We will: 1) invest in the underlying sources and tools of American power and influence; 2) build the strongest possible coalition of nations to enhance our collective influence to shape the global strategic environment and to solve shared challenges; and 3) modernize and strengthen our military so it is equipped for the era of strategic competition with major powers, while maintaining the capability to disrupt the terrorist threat to the homeland. (NSS, supra, pp. 9-10).
The President made this quite clear in the introduction to NSS:

The 2022 National Security Strategy outlines how my Administration will seize this decisive decade to advance America’s vital interests, position the United States to outmaneuver our geopolitical competitors, tackle shared challenges, and set our world firmly on a path toward a brighter and more hopeful tomorrow. . . Around the world, the need for American leadership is as great as it has ever been. We are in the midst of a strategic competition to shape the future of the international order.

To a large extent, then, one might be forgiven if the thought creeps in unbidden that the current iteration of the American foreign policy vision appears to be to preserve and augment the effective goals of America First but without its impolite and offensive discursive rabble rousing. In its place is a language and practice better conforming to international practices of discursive politesse.  That state of things would, at the very least, have the salutary effect of aligning the discourse and intentions of the United States and of China, each incarnating quite distinct visions of and for the world for each each has reserved for itself the position of apex vanguard leadership. At the same time, however, it becomes discursively critical to take the opportunity of personnel and discursive shifts to suggest that the change in discourse also has produced a change in objective. Moreover, it leaves open the question of the constitution of the amalgamation of willing states assuming various relationships with the leading forces of American functionaries and others with the authority operationalization of discourse and policy.   

This all becomes clearer as one considers the quite interesting contribution that that important mission, Stewart Patrick, "Four Contending U.S. Approaches to Multilateralism," published 23 January 2023 through the Carnegie Endowment for International Peace. The core purpose of the contribution is to think through modalities of multilateralism and their risk-reward profiles. The four that serve as the basis of analysis reflect what is put forward as the core consensus strategic approaches around which American leaders and their allies now strategize and with which they now argue among themselves. 

 

("Four Contending Approaches to Multilateralism," supra)

True to the times, the essay situates its contribution within the four corners of the new American foreign policy discursive orthodoxy. "The era of U.S. president Donald Trump exposed the shortcomings of a unilateralist and hypernationalist approach to the pursuit of U.S. global objectives. . . Biden has turned the page on Trump’s “America First” foreign policy, but the debate over alternative approaches to intergovernmental cooperation has just begun." (Four Contending U.S. Approaches to Multilateralism," supra). Patrick aligns the analysis, quite rightly, to the necessity of bending strategy to the realization of the NSS core objectives of American leadership over a rules based multilateral order.

The essay may be accessed HERE. The essay is an important one and well worth reading and thinking through. Brief reflections follow below. 

Saturday, January 21, 2023

外交部副部长谢锋:推动构建人类命运共同体是应对世界之变、时代之变、历史之变的中国方案 [Vice Foreign Minister Xie Feng: Promoting the building of a community with a shared future for mankind is China's solution to changes in the world, times, and history]

 

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 Chinese Communist Internationalism is, according to those who believe this, built on the smoldering ashes of the failures of the post 1945 World ordering--as envisioned and constructed under the leadership of the United States and its allies--the realities of the failures of which have only definitively emerged  in the last decade or so of the 21st century. Into this void, and articulated for the world in a more developed form by General Secretary Xi published in Qiushi (Seeking Truth),  and recirculated through Xinhua (1 January 2021), is a Communist (Socialist) alternative grounded in what is described as a different set of ordering principles built on the experiences of the post-colonial and developing world the leading forces of which are represented by China. That alternative is commonly amalgamated as the core internationalist principle of "Jointly building a community with a shared future for mankind." 习近平:共同构建人类命运共同体 2021-01-01 [Xi Jinping: Jointly build a community with a shared future for mankind].

What happened to the world, what should we do? This is the question that the whole world is thinking about, and it is the question that I have been thinking about. In my opinion, to answer this question, we must first clarify the most basic question, that is, where did we come from, where are we now, and where are we going? . . . The common aspiration of all mankind for more than 100 years is peace and development. However, this task is far from complete. We must obey the voice of the people, take over the baton of history, and continue to forge ahead on the marathon track of peace and development. . . China's plan is to build a community with a shared future for mankind and achieve win-win and shared benefits. . .The key to building a community with a shared future for mankind lies in action. I believe that the international community should make efforts in terms of partnership, security structure, economic development, civilization exchanges, and ecological construction. (习近平:共同构建人类命运共同体 ).

This was elaborated in a serious way for global consumption since the start of the Trump Administration (see, e.g.,  Wang Yi, "Work Together to Create a Community of Shared Future for Mankind" (31 May 2016)

The latest elaboration of this Socialist construction of the basic premises for shaping the global order through a revived Communist International(ism) was recently circulated by Vice Foreign Minister Xie Feng [外交部副部长谢锋]--"Promoting the building of a community with a shared future for mankind is China's solution to changes in the world, times, and history (16 January 2023) [推动构建人类命运共同体是应对世界之变、时代之变、历史之变的中国方案]. The original text in Chinese and my crude translation follows below.  I add only these brief comments:

1. It may be useful to foreground that the Chinese approach is grounded in a premise that politics is a means of expressing economic inevitability, and that internationalism as politics and economics is closely tied to the central objective of interaction at the national and international levels--the imperative of development.  "The 20th National Congress of the Communist Party of China made it clear that promoting the building of a community with a shared future for mankind is one of the essential requirements of Chinese-style modernization." [二十大报告明确将推动构建人类命运共同体作为中国式现代化的本质要求之一。(推动构建人类命运共同体是应对世界之变)] It is also important to understand the trajectories of that modernization--a trajectory first clarified during the Reform and Opening Up Era and now better aligned with the political front in the New Era. That overarching objective is tied to the fundamental mission of the Leninist leading forces vanguard--to establish a communist society. The path to that establishment is development at a sufficiently high enough level to make issues of economic necessity irrelevant to the organization of social relations. Modernization, of course, may be bent to other objectives.  That is the point of "Promoting the building of a community with a shared future for mankind." And yet, by framing post-liberal democratic internationalism around a Chinese Leninist understanding of modernization, it pulls all variants within the orbit of its core historical and policy objectives. That said, the point is not that this redirecting is either good or bad; the point is that it is there and rarely engaged in its own right. 

2. The general outline of the principal elements of "Promoting the building of a community with a shared future for mankind" remain substantially unchanged.

First, we must adhere to common development and inject impetus into solving the global development deficit. . . Second, we must promote common security and contribute to the realization of lasting peace for mankind. . . Third, we must promote common opening up and create opportunities for deepening cooperation and win-win results. . . Fourth, we must promote common values and build bridges for exchanges and mutual learning among different civilizations. . .Fifth, we must assume common responsibilities and do our best to maintain international strategic stability. (推动构建人类命运共同体是应对世界之变)

 Here the important element is the way ion which these are manifested in contemporary Chinese policy. That manifestation suggests the way different policy areas are valued (that is arranged in orders of importance), as well as the ways in which the trajectories of modernization based Chinese internationalism would then suggest a value maximizing set of alternatives (as well as alternatives worth rejection). 

3. China continues to use its current palette of international programs as the model against which elaboration of the five elements of Chinese internationalism ought to be measured and with respect to which the working styles of the international community ought to align. Thus, for example, with respect to common development, the Belt & Road Initiative is offered as " a platform for common development and cooperation created by China, and a vivid practice of realizing the 'world version of common prosperity'."(推动构建人类命运共同体是应对世界之变). Common security, the second prong, in interpreted in tyhe shadow of the Russo-Ukrainian War and China's foreign policy choices in that conflict. 

For this reason, President Xi Jinping proposed a global security initiative, emphasizing that mankind is an indivisible security community, advocating a common, comprehensive, cooperative, and sustainable security concept, paying attention to the legitimate security concerns of all countries, and advocating the construction of a balanced, effective, and sustainable security architecture. (Ibid.).

That position, of course, is incompatible in the strongest possible way, with that of at least some of the leading social forces in the liberal democratic camp; though it is quite useful in fostering factionalism in that camp by offering a conceptual rabbit hole into which certain elements of German, French, Hungarian and reactionary isolationist American vanguard members (among others) might find shelter. The third prong, common opening up and global integration elaborates the understanding of the so called win-win policy in trade. It is also the basis for moving forward economic interactions based on a dual circulation strategy (at least at the core). It is also a basis for attacking the American version of dual circulation grounded in national security imperatives--especially in the tech field. That makes sense from the Chinese side but poses challenges for those who seek to protect their own national security in a context where the appearances suggests that national security will be determined elsewhere. At the same time there is an intimation that only great powers have national security concerns that are not a cover for domestic market protection--a concept that is likely to be further elaborated this year. 

4. The common values prong tends to be undervalued by China's liberal democratic competitors. But it is important.  The elaboration of "whole process democracy" as a counter to liberal democratic  electoral based orthodoxies poses a substantial challenge to the contemporary structures of markets driven collective organization facilitated through notions of electoral representative politics manifested in public state organs. The last common responsibilities prong was the most interesting.  It suggests a further step toward the public elaboration of the principles of post-global empire in which the leading states--China and the United States--bear substantially heightened responsibility for the organization and management of the global collective orders. 

China and the United States share broad common interests and shoulder special and important responsibilities in maintaining world peace and stability and promoting global development and prosperity. Sino-US relations go beyond the bilateral scope and have a bearing on the future and destiny of the world. (Ibid.)
5. And thus the shape of post-global imperial management, which is tied both to the common security prong and  frames the basis for ideological competition critical for framing the way geo-politics is judged and shaped, especially in the context of war and social relations:

China and the United States have extensive common interests in bilateral and multilateral fields. There are many things that can and should be cooperated. The two sides should strive to make the list of cooperation longer and longer instead of shortening and shortening. Cooperation should take care of each other's concerns, give and take; it should be mutually beneficial, equal and balanced; it should benefit the whole world and benefit the world. [作为最大的发展中国家和最大的发达国家,中美在双多边领域存在广泛共同利益,可以合作、应该合作的事情很多,双方应努力使合作清单越拉越长,而不是越缩越短。合作要照顾彼此关切,有取有予;要互利互惠,对等平衡;要兼济天下,造福世界。] (Ibid.)

This is a delicate task as it threatens the public adherence to the principle of sovereign equality., and the notion of imperialism is still so discursively tied to its racist, ethnocentric and territoriality driven manifestations that ended after 1945, that either a new vocabulary for imperial responsibilities will have to be developed or re-education will be necessary to box the prior iteration of the imperial impulse within the cage of history. It also suggests that the borderlands of the new imperial order is ideological rather than territorial, abstract rather than concrete, and that stability at the borderlands is the optimum task of global management of the community of states and sub-national communities.

China and the United States should recognize the differences in each other's social systems and development paths, and respect these differences, instead of trying to change or even subvert each other's systems. China welcomes the United States to maintain prosperity and development, and the United States should also respect the rights of the Chinese people to pursue a better life. [相互尊重是中美交往互动的前提。中美应该承认彼此社会制度和发展道路的不同,尊重这种不同,而不是试图去改变甚至颠覆对方的制度。中国欢迎美国保持繁荣发展,美国也应该尊重中国人民追求美好生活的权利。] (Ibid).

 6. What is missing is the development and deployment of the counter vision from the liberal democratic camp.When it does come, it appears in fits and starts  perhaps (see eg Summit for Democracy) in part because of the focus of American elites on the internal squabbling that reached its high water mark during and after the 2020 elections and its institutionalization of a high level of corrosive internal fracture. Not that the counter narrative cannot be more strategically developed and deployed; strategic advantage, though may suffer as a result of less attention.

The speech, then, is richer than it might appear on first reading.  It is well worth a read and follows below in the original Chinese text and in a crude English translation.  A summary of the remarks, prepared in English by the Foreign Ministry may be found HERE.

Greetings and Best Wishes to Those Who Celebrate

 


Friday, January 20, 2023

《中国共产党处分违纪党员批准权限和程序规定》 ["Regulations on the Approval Authority and Procedures of the Communist Party of China for Disciplining Party Members Who Violate Disciplines"]

 

Pix Credit HERE

 

It has turned out, despite  the sneering in some quarters, that one of the most relentlessly implemented principles that has emerged in its New Era formulation (because nothing ever emerges out of whole cloth) has been the principle of rule of law understood in its most relevant application--the development of rule based structures for the constraining of the exercise of administrative discretion by functionaries. Most well known as 把权力关进制度的笼子里 [locking power in a cage of regulation], the principle emerged very early in the leadership of Xi Jinping (though often misunderstood because of the premises and expectations built into some of the analytic lenses available at the time). As nicely considered at the time by Kong Ling (孔玲 把权力关进制度的笼子里 ), 

On January 22, 2013, General Secretary Xi Jinping emphasized at the second plenary meeting of the 18th Central Commission for Discipline Inspection that "we must strengthen the restriction and supervision of the exercise of power, and lock power in the cage of the system." . . "Put power in a cage" can be described as a famous political saying in today's society. Before General Secretary Xi Jinping spoke, some politicians once said similar words: "In the thousands of years of human history, the most precious thing is not the dazzling technology, not the classic works of the vast masters, but the realization of the rule of the taming of those who lived there, and the fulfillment of the dream of keeping them in cages". Today, General Secretary Xi has made it even more clear that power should be locked in a cage of "systems," which is to emphasize the need to use a rigid legal system to restrain and control state power. . . Why do we have to put power or rulers in a cage? In the final analysis, it is determined by the nature of human beings. . .

In western countries, the traditional basic way to restrict power is "rule of law", and its basic method is "use power to restrict power" or "use force to deal with force" as mentioned above.  In our China, the basic way of its political tradition to restrict power is "rule of virtue". Political personality, strongly advocates them to implement "benevolent government", implement "kingly way", resolutely oppose blindly "tyranny" and wanton "hegemony". In today's society, under the leadership of the Communist Party of China, while inheriting and carrying forward China's fine political traditions, it also draws on the achievements of human political civilization, and puts forward "the combination of governing the country by law and governing the country by virtue". But it also pointed out that this combination must be based on the basic strategy of "ruling the country by law". (孔玲 把权力关进制度的笼子里 )

While much of the focus of 把权力关进制度的笼子里 [locking power in a cage of regulation] has been on the administrative apparatus of the state, the Chinese Communist Party has also sought to develop such rule systems to more tightly discipline the institutional operation of the vanguard. Important development in the context of caging regulatory and discretionary administrative authority within cages of regulation  within the CPC were announced in the run up to the 20th CPC Congress, one of which--regulation for the promotion and demotion of cadres was considered here). 

Nonetheless, the CPC has indicated that additional reform is necessary. Most interesting in that respect has been the 17 January 2023 issuance by the Central Committee of the Communist Party of China of "Regulations on the Approval Authority and Procedures of the Communist Party of China for Disciplining Party Members Who Violate Disciplines" --中共中央印发《中国共产党处分违纪党员批准权限和程序规定》. The Reforms reflect the objectives of CPC improvement specified in the Report to the 20th CPC Congress:

In strengthening the Party politically, we will enforce strict political discipline and rules, ensure that Party committees (leading Party members groups) at all levels fully assume their principal responsibilities, and enhance the political judgment, understanding, and implementation of Party organizations and Party officials at all levels. (Xi Jinping, "Hold High the Great Banner of Socialism with Chinese Characteristics and Strive in Unity to Build a Modern Socialist Country in All Respects" Report to the 20th National Congress of the Communist Party of China (October 16, 2022)).

The Reforms touch on the twin an intertwined objectives of strengthening ideological integrity and practical efficiency of the mechanisms.

Regarding violations of Party discipline, each and every infraction identified must be strictly investigated and handled. We will work in concert to enhance Party consciousness, improve Party conduct, and tighten Party discipline. This will enable Party members to maintain firm ideals and convictions, enhance their Party consciousness, and bolster their resistance to corruption and moral decline. (Ibid; Part XV, 6 )

These regulations reformed and superseded the Central Commission for Discipline Inspection July 6, 1983 the "Specific Provisions on the Approval Authority of Party Members Who Violate Party Discipline" (6 July 1983) and the "Notice on Amending the Specific Provisions on the Approval Authority of Party Members Who Violate Party Discipline" (March 28, 1987) ( 中国共产党处分违纪党员批准权限和程序规定》 ¶56). Article 54 The Central Military Commission and the Central Commission for Discipline Inspection share authority for administrative elaboration and interpretation. (Ibid., ¶¶ 54-55). 

The reform of the Party Discipline Regulations focus as well on better aligning its provisions with the New Era's ideological and policy framework in the “两个确立”与“两个维护” [Two Establishments and Two Safeguard] principles. These were also elaborated at about the time of the 20th CPC Congress. See 胡长栓 “两个确立”与“两个维护”内在统一的本质和要求 [Hu Changshuan, "The Essence and Requirements of the Internal Unity of "Two Establishments" and "Two Safeguards"]. These suggest the deep embedding of ideological principles into the constitution and operation of any system of disciplinary supervision.  In effect, the cage of regulation may constrain the range of discretionary decision making, but the cage of regulation is itself a practical application--and subject to--the hierarchically superior cage of ideology. 

The revised regulation follows below along with Hu's essay in the original Chinese and in crude English translations.