A FEW COMMENTS ON THE DEVOLUTION OF POWERS1
JUNE 3, 1988
Since we started devolving powers, the results in the past few months appear quite good. With the new powers granted to them by the city government, districts and counties have become more energized, as have enterprises receiving powers from the various bureau-level agencies. These are the two fundamental actions we must focus on this year in devolving powers and reforming functions. At this point, it seems that the devolution of powers to districts and counties has been executed better than in the case of enterprises, which are not yet sufficiently energized. Thus we should focus harder on them in the second half of this year. We should also affirm that devolution is the direction we are taking, and the various bureau-level agencies must actively and earnestly devolve responsibilities and the corresponding powers to enterprises as well as districts and counties.
Once the devolution of powers and fiscal contracting are in place, district governments will have to change their thinking and use their devolved powers well and energetically. District governments must clearly understand that they are the top level of government, so they must coordinate, balance, plan, and arrange the affairs of the entire district well. They must take firm charge of the duties devolved to them and make good use of the powers entrusted to them.
All districts and counties are indeed working very hard to do this. Let me give an example. One report from the Shanghai People’s Radio said that the Yangpu district made a very detailed analysis of all the work stoppages, halts in production, street demonstrations, and petitions over the past year. It included the reasons for these actions, how to work on these matters, and how to prevent them. After reading this report, I felt that we should encourage all districts to do such work—that is, to take full responsibility for work in the districts.
Although some of the enterprises in your districts might belong to the central government or to the city and you have no say in many matters regarding them, you are after all the top level of government. You’re there to manage these things, and if you can’t do so, you can let me know—I can help you in such cases. This way, you can effectively and rather quickly resolve many things that can’t be managed vertically. We’re counting on you to nip many hidden dangers and incipient problems in the bud. Of course this isn’t absolute, but you should do better at taking the pulse of the people and understanding their mood—in this matter I’m afraid you have more direct contact than our vertical leadership or me. That’s why we must count on you for many things. Whether things in Shanghai are handled well will depend on your efforts.
Another point to stress is that although all of you 12 district heads are “mayors” and bear responsibility for all matters, you must obey administrative orders from higher authorities and cannot each do as you please. Whenever you feel uncertain about a matter, you should still keep the relevant bureaus informed and not act rashly. That kind of behavior won’t win you any support, or sympathy from other districts. Certain cases require unified coordination. When a street spans several districts, if each were to act on its own and if districts didn’t accept citywide coordination, chaos would ensue. We therefore expect district heads to have a comprehensive perspective; to consider problems in greater detail; to think more about those above, below, and around you; and to communicate more frequently.
Districts should also streamline administration and devolve powers internally. Your agencies have to maintain overall balance, so don’t keep everything in your own hands. If everything below you is run as a “vertical dictatorship,” nothing will get done. Shanghai’s enterprises are different from those in other places—they have a much better foundation and have many capable people. If you unleash their energies, they’ll be able to accomplish a great deal and won’t need your guidance on everything. Shanghai management is of a very high standard and has a very tight system of checks with entire sets of ways to manage people: its various laws and rules have been memorized well; hence people are tightly bound and unable to put their enthusiasm to use. I say let’s cut out some of these things. The key is to make the frontline enterprises and publicly funded institutions come alive—then we will be able to do better.
On this point, I hope you will note that your work consists mainly of macromanagement, whereas you are a bit more micro than we are. You are closer to the front lines in many matters, but you should still be working primarily on macromanagement.
A final point: leaders of all districts should be familiar with urban management, particularly with financial management. Urban management is a science, one that everyone should study. If you don’t understand urban management, you won’t be able to get anything done. Yesterday I went to the Nanshi district and visited the Temple of the City God and its markets. The temple is a “golden rice bowl,”2 but its markets are not of the caliber I had expected, especially in view of its international reputation. I thought it wasn’t bad when I saw it a few years ago, but now my expectations are higher and I feel it isn’t even as good as many of the markets in Zhuhai’s Jiuzhoucheng shopping area and its special economic zone. Shanghai has really fallen behind. We aren’t making adequate use of this world-famous Temple of the City God. Take over the residences inside it. Otherwise, people will be eating downstairs with diapers hanging out to dry overhead—how could foreigners go into such a place? The temple interior can be renovated step by step, with a fine food street surrounding it where people can have fun, have things to see and things to eat. It should also have a parking lot and toilets. District heads have to learn to identify which places generate revenues. They should focus on this and make things more dynamic.
Furthermore, although you’re focusing on money now, you mustn’t take over the streets. I’m worried that the more you develop, the more you’ll expand into the streets and make a mess of traffic. Next week we’ll be passing a resolution on improving Shanghai’s traffic situation within three to five years. One of its provisions is to clear the streets. Otherwise how can we solve future traffic problems? We must always be forward in our thinking and depend on district governments to do much of the work of improving traffic management.
Can the district governments also focus a bit on the city’s appearance and its sanitation issues? These are also aspects of government work. If the city’s appearance is poor, people will be in a bad mood and it will be very hard for them to work enthusiastically. If city leaders can pay more attention to this issue, it should be possible to improve the look of the city somewhat. I travel all over the city en route to meetings and see garbage everywhere. It makes me feel terrible—this is really too uncivilized and I hope everyone will focus on this a bit.
1. This is the main part of a speech by Zhu Rongji during the new administration’s first meeting of district leaders. After the central government enacted fiscal contracting for Shanghai, the Shanghai Municipal Party Committee and government made a decision to enact contracting and to clearly delineate the responsibilities of district governments. The necessary powers in planning, foreign trade, commerce, labor personnel, and urban construction associated with fiscal contracting were devolved to them. In March 1988 the Shanghai municipal government decided to enact a fiscal management system for its rural counties whereby they contracted fiscally to turn over a set sum. That April, the municipal government further devolved the powers of review and approval for fixed capital investments to the districts and counties.
2. Translator’s note: a golden rice bowl is a metaphor for a profession or a position that is stable and that pays well.