How oil became the latest Chinese food scandal
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Hello and welcome to Chinese Whispers with me, Cindy Yu. Every episode I'll be talking to journalists, experts and long-time China watchers about the latest in Chinese politics, society and more. There'll be a smattering of history to catch you up on the background knowledge and some context as well. How do the Chinese see these issues? Whenever I go back to China, I try to eat as much as I can. Delicious Chinese food that I can't have outside of the country, whether that's childhood favourites or the latest food trends.

But I'm often struck by those of my relatives and friends who turn their noses up at many of these delicious dishes. They commonly say, 不敢吃, I'm scared to eat it. The Chinese middle class can now be very discerning about the food that they eat. And who can blame them? In the last 20 years or so, there seems to have been a steady stream of food safety and hygiene scandals. Most infamously, milk powder laced with melamine in 2008, which poisoned tens of thousands of babies.

Since then, we've heard about pesticides being put into steamed buns to improve their texture, used cooking oil being ladled from gutters to be reused, and lamb meat that might contain rat or fox. The latest scandal, breaking over the last couple of months, is that of fuel tankers being used to carry cooking oil without the tankers being cleaned in between. So what gives? Are these scandals a particularly Chinese phenomenon? Why hasn't government regulation or punishment worked?

And how does this impact political credibility in the eyes of the middle class? I'm joined by two brilliant guests to discuss all of these questions and more. Dali Yang is a political scientist and sinologist at the University of Chicago, whose research has focused on Chinese regulations when it comes to food and medicine. His latest book is Wuhan, How the COVID-19 Outbreak in China Spiraled Out of Control. James Palmer is deputy editor at Front Policy and author of numerous books on China. He worked for years as a journalist inside China.

So Dali and James, welcome to Chinese Whispers. James, to start with, can you explain what's been happening with the cooking oil scandal? So about a month ago now, I believe it's Beijing News, which is a very big and also very good local paper operating under the conditions of Chinese media, of course, which always involves some censorship and so on, reported that transport trucks were being used to carry both

Cooking oil, which is the mainstay of pretty much, you know, like 90% of dishes in China and fuel oil. So the oil that, you know, powers stoves, the industry and so on.

And once they kind of broke the dam on this, and this is quite common in Chinese media, once you've sort of broken a scandal and it's been allowed to be reported on, dozens of other people are able to follow up on the scandal because there's all these very talented reporters and citizen journalists and so on. But normally they are somewhat limited and they're cautious about touching stuff. So once...

They said broken. Suddenly, there were all these reports of this happening across multiple sectors, including the use of oil tankers or ships to do the same thing. And of course, people were shocked by the idea that the oil that their food is cooked in could be contaminated by the much rorer conditions of fuel oil and grossed out. Basically, people are worried and disgusted.

And this, there have been a bunch of oil related scandals in China in the past, particularly around the use of gutter oil, that is, oil that was amateurishly recycled and put back into the food chain. And so people were very prepped for the idea that like oil could be a problem.

Dali, this is not the first food scandal that has hit China, not by a long mile. As James says, there are other oil-related ones, but also there are lots of really concerning food ones in general, going back the last few decades. And I think the most seminal one is maybe the milk powder scandals of the early 2000s.

Well, yes. The one, in fact, in the Olympics year 2008, there was this scandal concerning the, at our region, really, milk companies, or baby formulas in particular, were produced with milk that included industrial chemical called melanin. And of course, that actually is a sort of ingredient. They

basically got into all manufactured or processed milk, including baby formulas, and of course caused widespread concern in China. In fact, not only in China, because for example, even dog food imported into the U.S. included that as well. And

The most striking thing about that incident as well was, number one, of course, it affected young children at a time when Chinese parents were eager for their children to get better nutrition. They were consuming a lot of baby formulas and so on at that point. But equally important was how widespread, like the current oil, cooking oil incident as well, it was actually really spread all across China and to some extent globally.

But what's also equally striking was how, in fact, the story didn't break in the place where it originally happened, in the places where milk was produced. But in fact, in this particular case, for example,

Newspapers originally reported, without bearing to mention the names of the companies really that were concerned, until a journalist by the name of Jian Guangzhou in Shanghai decided to actually reveal that name in Shanghai. And then suddenly it exploded into a big, massive story, essentially.

Now, what's striking also is, on the one hand, there was a crackdown, and one of the companies in Hebei province essentially was severely punished, but others were let go. For example, the biggest ones that continue to exist today actually basically were given slaps on the head and basically said, oh, behave yourself. But on the other hand, the journalist who went into the investigative process

reporting. In this particular case, Mr. Tian shifted to other things because he realized it's so dangerous to carry out the reporting, mock repeating of this kind.

But by the large corporates rather than by the government or both? No.

partly by hard hands by the corporates, but also because they don't get support from the local governments because the local governments get tax revenue and other benefits from the presence of these companies.

they tend to be very protective of the companies as well. And in the current case, in terms of the cooking oil scandal, the entire Chinese establishment, the propaganda system, has been censoring this story to keep it down because

Partly because of the timing, but partly because of how pervasive it is. As Jim mentioned, it could be fuel trucks that were shipping the cooking oil without cleaning the tankers, essentially. But in fact, it could be those trucks

Trucks could be shipping other chemicals as well, again, without cleaning them. So the dangers actually could be more pervasive. But also it's not just actually related to cooking oil itself that actually are used in cooking.

That oil very often goes into, for example, cookies, a lot of other things as well in terms of the food products. So I think actually the Chinese government, especially because of the timing that coincided with the third plenum and so on, so they decided to keep it at all.

I think we often see a sort of cycle whereby a story goes viral, is able to play itself out for two or three days without being censored. And it's partially because there's a...

kind of attempt by the system to establish, are we going to allow this to be covered? Are we going to shut it down? The lines often aren't clear at first. And so you have, and sometimes stuff can flare up in such a way that kind of carries past the censorship and everybody becomes aware of the story. And then when the story becomes shut down, they become more sensitive about it being covered up and more aware of it. And this kind of keeps the cycle going because then you become angry about the coverup.

And James, it's easy for us outside of China to be talking about all of these problems with government regulations, the scandals that are happening. But how seriously do the Chinese themselves inside China take this story? Maybe you can give us a taste of basically how much anxiety there is related to these kinds of stories when it comes to the actual Chinese mindset as well.

Oh, it causes enormous anxiety because it touches this very fundamental kind of aspect of life, the food, you know, the stuff you take into your body. And because people know that they exist in an environment of censorship about it, that worsens the fears. Like, what are they not telling us? What are they covering up? And most of the time, people, most things like

politics and so on, people don't care that much because it doesn't hit them at that same like immediate level. But with food, it's so personal. It makes me think of Upton Sinclair and the jungle, the United States, which, um,

was a book written by a socialist, a socialist writer who wanted to write about the labor conditions in Chicago. But people ended up caring not about the labor conditions, but about the food production conditions exposed. And it was an enormous scandal back in the late 20s, early 30s. And he said, you know, that he had set out to hit the American people in the heart and instead hit them in the stomach.

And that kind of applies in China, too. The stomach is so personal, so intimate. And you look at, for instance, the baby formula scandal. And that caused, of course, massive fear for all these young parents. And people were going to any extreme they could to import untainted products.

milk powder from outside, the price of it soared 10 or 20 times on the Chinese market. And if you went to London at the time, I remember this, you went into a supermarket in London, the supermarkets had signs up saying limits of two formula cans per customer, because both Chinese parents and Chinese kind of, you know, entrepreneurs were just coming in and like,

Buying up everything. And every time something like this happens, you can see that anxiety really being reflected in prices. So, for instance, after Fukushima, and this wasn't a regulatory thing, this was a kind of panic radiation thing, there was a worry that I think it was salt water.

had been contaminated. And again, the prices just went all the way up. And so it's incredibly personal. It's incredibly immediate. I think in most cases, it doesn't transfer into political action or expressions of anger in that way, because there's no real vehicle for people to be able to do so, especially when the problem is so widespread. Where exactly do you go to protest? Who do you try to shut down? And of course, because any attempts at protest, even if it's

at a course that the government

broadly normally approves of like food regulation the active protest itself is risky and gets shut down. Yeah I certainly remember going back from the UK to China definitely smuggling some milk powder in our family suitcases when we went back to see family full time and Dali let's talk about how widespread that responsibility is spread then because that does seem to be part of the problem that there is no perhaps no one authority that is in charge that no one person to blame can you tell us about what basically the

policy and regulatory environment is that has led to this prevalence of food scandals? Well, I think a lot of it, it depends on the specifics of the cases. Before the melamine milk formula scandal, in fact, there was a regulatory move to enhance the nutrition content of the milk.

That actually meant that manufacturers, the producers, actually sort of were tougher on standards for nutrition.

But then the reason was that there was another scandal going back a few years earlier in 2003, whereby babies were undernourished because their baby formulas contained really very little milk. As a result, the government actually enhanced the standards, saying that you have to contain so much in terms of protein and so on. The problem is, however, in the process, because

Some of the cows in China did not produce actually milk that had such high protein content. But in the process, Iowa, the testing was testing for a particular ingredient. So suddenly it became actually standard practice in many parts of the country that they included some melamine into the milk.

to boost the test results. So that's the kind of a situation, essentially. In the case of the current, the chokers, the oil or cooking oil crisis, essentially, clearly this is the case where there are standards governing cooking oil and so on. And

the wholesalers proudly display all that information in their stores. But somehow people forgot that actually a lot of that industrial, the oil used in food industries and so on, and also in large kitchens, tended to be purchased in bulk and then repackaged across the

different territories in China. And as a result, actually, this is needed to be shipped. So the vacuum for shipping was that in recent years, there are many truckers who have purchased their trucks, but they face high charges, highway tolls, for example. And so they are really barely actually making it.

across the highway system, and they have to save on money. Every time, for example, a tanker is cleaned, it costs 700 yuan, and that's actually an entire day's profit probably for many of the truckers. And of course, if they could get a road visit, they would, and clearly that's the case. And again, the pact is just spread. Nobody was paying. Basically, there was a lot of connivance at what happened.

In this particular case, James was mentioning how often St. Clair's got the attention of the American people. But of course, at that point also, it got the attention of the American president, Theodore Roosevelt. In this case, it turned out the oil that's used, typically the Chinese elite got their own supplies. But the understanding in this case is actually that this

cooking oil crisis actually affected the elite as well. So therefore, it became actually even less allowed in a way. So I think actually that's part of the reason the track town will be swift, generally speaking, and they have to try to do something. But trucking, however, is regulated by the Ministry of Transportation and so on. So there are a lot of inter-jurisdictional issues that needs to be handled.

But part of the reason, again, is this is a relatively new phenomenon. In 2008, for example, still, trucking wasn't as big a story in a way. But today, it's a much bigger portion of shipping and so on. And as a result, it's become much bigger. It's very standardized in many ways with the tankers and so on. And they ply the highways. But then it became a newly emerging. And of course, it's a big issue in this particular.

So things keep happening partly because the technology, the social conditions have changed. The regulation has not been paying as much attention. In fact, we have been sleeping on the, especially during the COVID lockdowns and so on. They let the truckers go and the testing was focused on whether the drivers had COVID, but a lot of the other things actually got ignored.

Well, that question of regulation lagging behind market conditions or social conditions, I mean, it's a theme that happens in other countries and economies as well. But are we being unfair in talking about China's scandals? Does it happen more often than in other situations? Or does China's regulations particularly lag or is particularly lax bite? Jali, I don't know if you have thoughts on that. Well, that's a great question because people tend to say, oh, this is China. The regulators tend to be harsher and more swift and so on.

In a way, it is. But there is also the issue, and this relates to COVID as well,

namely, China is a gigantic country with a lot of spatial variations. Things are different across different parts of the country. The most important thing is usually there are weak links. I think in the case of the cooking oil in particular, the chokers are the weak link. But why are the chokers the weak link, actually? A lot of the reason is there is in China this

The macro system is actually one that undervalues labor. Labor are not treated with a lot of respect, care. And the emphasis tends to say, oh, we want you to be paid as little as possible in a way. That relates to whether the really truckers are a way of the big drivers. They make a lot of big investments, but at the same time, relative to their own income, but at the same time, they are not being paid.

compensated very well. Of course, they tend to cut colors, but in the process, however, it's very often because the margins for Chinese chocolates is so low in recent years, the e-card existence, very often they are in significant debt. And as a result, actually, I think the regulation should not be just about the quality.

It's actually about the industrial working conditions. And that relates not only to the truckers, but also to the DD drivers, for example, and to the industrial, the factory workers as well. A lot of the issues relate to this. Over time, China has been catching up, whether it's actually labor protection and so on. But generally speaking, it doesn't happen until there is

either by major incidents and so on, where it captured the attention of the people. And James, in the Beijing News Xinjingbao report initially, I was reading and it said something about how in recent years, in particular, competition has got more for these truckers, so that the bottom line has become more intense, the competition has been more intense, so they have to cut more corners. I wondered in that, actually, if there was a pandemic impact there, in the sense that the economic growth is slowing down, and so...

you know, people are having to compete a bit more? Well, there was an even more direct pandemic impact because so many truckers lost significant portions of their income during lockdown. They often started not taking contracts at all if it took them near COVID, potentially COVID-ridden areas, because they could be caught in lockdown and basically lose two or three months of income without any form of compensation. Now, almost all truckers in China are freelancers, basically. They're kind of

The average size of a trucking company is 1.5 people. They are like mom and pop operations. They're often couples who drive trucks.

who drive together. And this means that they have very little money, they live on the margins, they don't have the money to invest, as Dali mentioned, into improving their own trucks, their own conditions. And in most countries, supermarkets, big restaurant chains, and so on, operate their own fleets, basically their own supply chains almost. And these fleets are

can have significant capital investment from the company to improve the trucks, and in particular for refrigeration. But in China, because these are such fairly low-income, marginal people doing this work and who went into debt often to buy their truck in the first place, they don't refrigerate the trucks, for instance. Only less than 25% of all meat in China goes through cold storage when transported, less than 5% of all vegetables.

So this stuff is just sitting in the back of trucks for sometimes days in, you know, sometimes like 40 degree heat. And then Danny mentioned the highway tolls. And I think just to give a little background there, Chattanooga,

China has highway tolls everywhere. Like it's why I think one of the most surprising things for foreigners coming in if they drive between cities is you hit so many tolls so constantly because they were used to fund the construction of the highways in the first place. They were often put in on a 10 or 15 year basis and the government just kept running the tolls anyway because people had generally bought up the rights to control the toll income separately. So the whole situation

chain of rent seeking going on there. And so this kind of goes back to the question of is this a uniquely Chinese thing? Well, you know, all countries have their problems. But in China, you have this combination of very recent, in historical terms, economic growth, these big booms creating these new conditions, and

of a huge country that has fragmented systems of government, like much more than I think the average person understands from the outside. There are many different levels of local, provincial, national government and so on. And the national government is pretty small. Like it's a pretty thin layer at the top, paradoxically. Most of this goes through local authorities. And this can produce stuff like

Highway tolls being high imposes this extra burden on truckers, and this extra burden on truckers forces them to cut costs to the bone, not just cold storage and food transport, but also overloading. You'll see these trucks that are packed on just enormous amounts of stuff because they can't make a profit on the route otherwise.

So if you want to solve these problems, you have to tackle these multiple layers of stuff. You have to try and find a way to ensure fair working conditions and decent capital injections for trucking companies, for instance, rather than, as at the moment, having them all go through middleman apps.

sprung up in the late 2010s that send them all over the country and that have them in the same way as delivery drivers are locally as basically gig workers. So

On the one hand, you have straightforward corruption and big vested industrial and agricultural interests that work against regulation. And on the other, you have regulators who are trying to do their jobs but are struggling with these very difficult conditions. One of the paradoxes, I think, in labor protection in particular is that sometimes the laws on paper are very, very good because of the country's socialist heritage. Sometimes you have these laws that are like

you know, if the thermometer goes over 40 degrees, like workers get the day off and you can't fire anybody without consulting with the local government and all this kind of thing. But because those regulations were so heavy on paper, they're so often ignored in practice and people get used to ignoring the regulations or working their way around the regulations. And

that starts to apply even to the ones that directly affect safety and working conditions. Yeah, that's why I find it quite funny whenever there's a trope of Chinese people being very law-abiding or rule-takers. It's actually the Chinese people I know are some of the most opportunistic about cutting around the corners or just directly infringing things that they're meant to be doing. Well, this is really interesting what James just mentioned. And for example, in terms of the temperature regulation,

But then the local authorities have an incentive to under-report the temperatures. So a recent complaint is actually how come the U.S. embassy records a temperature in Beijing that's higher than the city of Beijing's actually. And for the same reason, Shanghai had only reported

actually reported only one day thus far, I think, of 40 degrees above Celsius a day that actually requires significant protective measures and so on. So there are those kind of situations. But I do want to emphasize the power of the apps, the platform companies has become

a huge in the trucking industry as well, just as it does in terms of the taxi companies. And they tend to be very powerful, not only in allocating jobs, but also in terms of taking a big share of the

of the earnings. And that's been another big complaint in China as well. So in many ways you could argue, and there are suggestions to suggest actually some of the policing of the truck drivers could easily be done by the platforms because it requires, for example, and I think actually that's likely to be a big portion of the

follow-up regulation in terms of the recent problem and scandal. But at the same time, the underlining challenges is still that actually we are going to see some reaching transformation in the trucking industry because

Many of those truckers cannot survive in current conditions. But as we all know, however, China is going through a deflationary period with intense competition, and that's been the case for several years now. I think one of the hard things, too, is who pays the costs in this case? Because the instinct is going to be, let's regulate the drivers better. Well, the app's going to say, if your truck doesn't meet these conditions, you can't function on the app. They're not going to provide any help.

for the drivers to actually upgrade their tracks. Yes, it's quite punitive. Yeah, and it reminds me of the Didi crackdown back in what was about 2015, 2016, I think. My date's off today because I just realised the jungle was actually 1905, not the 1920s, too. As soon as Ali said Theodore Roosevelt, I was like, oh, God. It's...

It's a Friday. So it's a Friday. I'm 46. My memory is, you know, gradually eroding with time. So with Didi, you know, like Didi apps, which is the Chinese Uber, absolutely exploded in China and pretty much everybody started using it. It transformed. You couldn't get a cab without Didi.

But this created a new class of urban migrants because people in the countryside were buying cars and then they were coming into the city to work as DD drivers, which was at the time very profitable. And they were sleeping in their cars.

So you had a huge influx of new migrants. And now one of the preoccupations of the city authorities in China is keeping the population down and shutting the migrants out or ideally forcing them away from the top tier cities to these sort of second or third tier cities where they want more development.

And so they hated this. They hated this big influx of numbers. And there were some social issues because you had all these basically homeless or semi-homeless guys living out of their cars parked all over the place. So they forced Didi to impose Hukou regulation on drivers. You had to have a residence permit for the city in order to be able to drive in it. And this

cut down the numbers considerably, but it also took a bunch of cabs off the street, cost a bunch of people their livelihoods, and so on. And so the balancing act...

often tends to end up screwing over labor. Like they're the guys who tend to get dumped on most of the bottom, even if it can also hit the tech companies themselves, it can impose these big costs on the tech companies, but they will try and pass down as much of this cost as possible. Well, actually, so a lot of this, what we're talking about, and especially talking about the platforms of the gig economy as well, I wonder if another aspect of this is particularly Chinese, Dali, is how quickly the economy is changing. Yeah.

expanding, but also how quickly it's changing in terms of the industries that are up and coming. Obviously, many, many economies across the world grow and grow fast, but I don't think Chinese growth, and to the extent it is now, is really kind of replicated in many other places. Well, certainly it's the scale, but also the tremendous commitment to something that

As someone who has lived in China since the 1980s, for example, you see the waves of new consumption coming in and investments. Very often people emulate each other and really keeping up the Joneses, but on a scale that's unprecedented.

whether it's the handbags or all for that matter, the vehicles and so on. And of course, in the current phase, a lot of it is about the, for example, new vehicles that are becoming available. And of course, these people driving, you

In a way, on a scale, again, with a massive number of new drivers going on the road. And also, there are many seniors who are driving unlicensed as well in unlicensed vehicles. And interestingly, so that's another aspect of this. Sorry, that they don't have driving licenses or the vehicle is not licensed?

They don't have driver's licenses. Their vehicles are not properly licensed. The local governments know that those vehicles are not licensed to drive on the highway. So they drive and they technically should be driving on the sidewalk, for example. But there are so many, a lot of the substandard vehicles as well that are electric actually today that are emerging today.

at the same time. So we see both the formal aspect of the economy, of the technology, but at the same time, we also see alongside the formal something fairly informal, but also tolerated in a way. And for the same reason, the Chinese government across the country has been cracking down on electric e-bikes.

because they have been found to cause fires. And so there are a lot of complaints about, oh, why are you complaining on cracking down on this? Didn't you approve of all this before they are being put on the market? And so there is actually a big debate about this issue because people find it very convenient to drive the e-bikes, but they do, and some of the batteries are substandard and there have been fires that have been caused as a result. And so it's a big issue again. And of course,

Local authorities also have another reason to crack down on the bikes because they want to promote their electric vehicles, which generate tax revenue. So there are also some mixed motives in the process. Well, actually, I wanted to ask how much corruption was a problem. You know, is this a matter of

regulators being bribed or is it just, you know, is it callousness or is it deliberate corruption? James? I was going to note too on e-bikes it also speaks to scale because in fact San Francisco had these e-bike fires too but in San Francisco's case these were isolated kind of incidents even though the number of fires I think something like

tripled in the course of a year when e-bikes were adopted it didn't cause big problems but in China because of the sheer scale and density these e-bikes were being parked really close together too so instead of like one guy's bike catching on fire and that's and you know it gets put out you had these fires that would start in like parking lots or compounds where like

50 e-bikes had been put together and one battery goes up and then it spacks off the others and you have these quite deadly conflagrations. So just the sheer number of people really accentuates the

speed of change it becomes this multiplying factor where stuff can change very rapidly for instance in mongolia but mongolia has two three million people it's very easy to kind of control these things in relative terms but when if five percent of the chinese public adopts a new technology suddenly that's 70 million people doing it and so it's just much harder to cope with

On corruption, I think you have a couple of things going on. You have the kind of high level sort of development corruption where the industries themselves are directly driving regulators. And that does happen. It happens a lot. Like it's very common to have essentially an understanding with the guy who's like doing the inspections at your factory, at your farm, whatever. Yeah.

But you also have the sort of small scale extractive corruption that has these knock on effects. And I was thinking with driving licenses now, back in 2003, 2004, I remember if you wanted a driving license, you had to hongbao the guy administering the test. You had to bribe. Right. Like it was a red envelope. Almost a regularized bribe. There was a recognized amount.

And this amount varied depending on whether you were in the countryside or the city, what kind of license you were trying to get. But it effectively added another layer of cost to anybody getting a license.

And so you would have people who, especially in the countryside, who didn't get these licenses because they couldn't afford the cost and were basically like, well, I will take the risk of being caught and fined against this known cost. And this is one of the things that I think corruption does. It just creates this atmosphere in which

even the regulators themselves can never quite know what burdens are really being imposed on ordinary people. Does Xi Jinping's anti-corruption drive help much? No, because the anti-corruption drive mostly hit what I would call

expressions of corruption through consumption. It had some effect on high-level exchanges, though to a large degree it just pushed them into, like, you must now make deals with Xi's faction. And it had a big effect for a while, though this has gone down a lot,

on your ability to spend the money that you earned through corruption because that was what the regulators were really looking for well you know were you holding a banquet with a thousand people for your daughter's wedding did you just buy a new sports car or this kind of thing um it didn't have much effect on these kind of like low level kind of demands for regulated drives like um

in driving licenses or in hospitals where it's very understood that you have to pay the surgeon if you're getting a surgery, you're giving, it's kind of somewhere between a tip and a bribe. It's like an expected kind of form.

And that anti-corruption didn't really focus on those small exchanges, which are very hard to surveil in most cases too. And so it didn't have a big kind of effect on them. That makes sense. Dali, is there anything we can learn from the food safety scandals in terms of other areas of Chinese governance? In particular, you know, you've got a recent book out called Wuhan about the Chinese government's response in the pandemic. Are there similarities there that you see?

There are similarities. Actually, there are striking similarities, if one digs a little deeply. Namely, everybody seems to be doing their job. If you look carefully, the truck driver drives, the app delivers the jobs to the truck drivers, the local governments do their jobs, the regulators do their job. So somehow there is this vacuum.

In a way. And for the same reason, in Wuhan, for example, in late December 2019 and early 2020, everybody seems to be busy again. But of course, then the Wuhan people...

found some excuses not to report the cases to Beijing until the national, the China CDC, directed General Lin about the initial cases on social media. And then they basically told, the National Health Authority told the local authorities, you should report new cases to us because, of course, that would mean something. That means, of course, the virus was spreading or something. And there were a lot of new pickpockets

Patients showing up in hospitals, but actually in Wuhan, those cases were not recognized as new COVID cases for more than two weeks, actually, at that point. And of course, there were efforts, in fact, by the local hospitals to file cases into the national disease reporting system.

They were blocked by the provincial authorities. But in the end, however, the provincial authorities found excuses for themselves to say, oh, we can't report because we are waiting for the test to arrive from you guys from Beijing and so on. There is this issue in the end. And one question that kept running in my head was who is minding the stall? Because you need the strategic...

thinker, the strategist in looking over the situation, deciding that this requires intervention and to make it more effective and better in terms of the results for the country and so on. And that's not happening. And I think actually again and again, we have this kind of almost like it's a bureaucratic organizational collective action problem. People knew there might be problems. A lot of people saw the situation at hand, but

Then they say, oh, I'm doing my job, but it's someone else's business and so on. And I think that's the big issue. And the current system has not helped in a way because, again, she has been focusing on

cracking down on dealing with risk. But in fact, in the process, there is a cadre in China of people, officials, who have decided to become very risk-averse. They tend not to want to bother with things not exactly being asked to do. So even Xi became himself actually exasperated. Basically, at one point he was asking, "Do you have to wait for my instructions?"

in order to do something. But the problem is the very system has created conditions for local authorities in China, basically saying that, oh, if I do something on my own, I may get into trouble. If I wait for instructions, I always report the situation, but I wait for your instructions before I move. As a result, actually, the system

tends to be slow in responding to major issues until they become a crisis. And even when they become a crisis, people may not pro-offer their outlandish or certainly their controversial views because they don't want to be punished for being the messengers bearing the bad news. And for the same reason, also in China, for example. But part of the reason, again, the system tends to say, oh, we encourage you to report the good views on it.

So in China, we have a situation, the National Bureau of Statistics

Rather than focusing on getting the better quality data reported to the national authorities, gets into the job of saying, actually, we need to be optimistic about the economy and so on. That's not the job of the Statistics Bureau. The Bureau's job is to report good data so that decision makers can make the decisions. But then they forget their mission. The reason is political harm.

optimistic statistics? I will say a lot of the National Bureau of Statistics guys would just express, sometimes in public, this kind of like despair with the provincial level reporting. And they used to, I think they've stopped doing this because of this push for

positive energy. But they used to complain pretty regularly about the provincial level GDP data and pollution data, for instance, and they would issue they had at one point a kind of list of bad provinces up on the website that chastised people directly. But again, as I mentioned, because of this good news, positive energy kind of push we've seen across the board,

It's very, very hard to raise problems. And an interesting example of this is within the Ministry of Foreign Affairs, they used to have a dissent channel that paralleled the U.S. dissent channel, whereby quite low-level staff could register complaints directly to the top. And it was always risky to use because this is, after all, China. You don't have any... If you like...

go around your boss and he finds out you're still screwed. Yeah, so there's anonymous employee surveys that companies give you. A certain, you know, let a hundred flowers bloom quality about the whole thing. Like, why not tell us your complaints? Please list your name and address.

But it did apparently function in some cases, and then it was actually just formally abolished around 2014, 2015. And so the whole atmosphere, because one of the things that happened with anti-corruption

was that they were really afraid of and hostile towards grassroots anti-corruption and ordinary people reporting. You would have this big swell of people doing sous-vailants, monitoring the system from below. The classic example being the official who, you know, appears with like five gold watches at a press conference.

And the internet immediately goes into overdrive. You know, like how much money does he make? Where did he get those watches? This kind of thing, or videos of officials behaving badly. And part of the point of the anti-corruption drive was to essentially bring the entire narrative of anti-corruption control and reporting purely

purely back inside the party because it went alongside this massive crackdown on bloggers, on reporters, on expression online. But this then produces this problem where you get into this, you know, who will guard the guards themselves, who watches the watchman situation. The people who are...

monitoring the system are also the people benefiting from the system in a lot of cases. And, you know, the party tries to have these internal groups that like allow for inspections and so on, but it generally just,

keeps going back into this cycle of failure because without transparency, without outside monitoring, you can have all the campaigns you like, but the rot just keeps coming back in again and again, whether it's for steroids in pigs or Dofus schools or any of the myriad kind of regulatory issues. You can't ultimately solve the problem purely from the top. Yeah, yeah, Tofu schools being those constructions that have been so, corners being cut so much that they actually quite shoddily

That actually leads up quite nicely to my next question about the people who can hold these authorities or these actors to account, which in this case was actually a state media paper, Xinjing Bao and Beijing News. It goes against the narrative of what people understand Chinese media to be like, that there is this proper investigative journalism aspect going on. Dali, is this common? Yeah, the...

In fact, the information about the truckers shipping cooking oil and so on had been around for years, but very low profile fashion in many ways. So it's this dedicated reporter, Mr. Han, Han Futao, who actually did the reporting and really panned down how it happens and the scale of this.

As a result, however, he's pretty much actually disappeared from social media in recent weeks. Apparently, the top leadership of the paper has been replaced, not because they did good reporting, but because they did this good reporting. That's the status, the

Essentially, over the last 20 years in particular, good investigative reporting has been under tremendous pressure. Many of the best, most dedicated journalists doing investigations have been forced to leave or in certain cases have been made to disappear. And that's really one of the most sad aspects of Chinese journalism in many ways.

But again, though, it shows from time to time there are reporters who realize, who are so dedicated, who are oblivious to some of the pressures, who decide to focus on important issues like Mr. Ha. He has been reporting on various situations that are not welcomed by the authorities. But nonetheless, he felt that is his mission to report on. But again, though, this particular case got so big.

So he's been under a lot of pressure. My sense is he remains safe at this moment. Actually, even though he's disappeared from social media, he essentially cleared up his, for example, Weibo account and so on. But it's not likely that he'll be allowed to be in the limelight for quite a while. And in certain cases, some reporters have decided to do it online.

on their own. But it's being reported now that the Chinese authorities are also trying to tighten. As James has been mentioning, actually, it's very often if you want to go through the system, there are just so many hurdles to do things. So as a result, the social media in particular remains quite powerful. And

And even officials, even police chiefs sometimes when they feel they have been wrong, instead of filing their complaints through the Chinese system officially, they go on social media, including Jiangxi in recent days as well. And this is where one channel where it's actually its former mistresses and so on who feel wrong decide to report on corrupt cases by going to social media.

But as James has mentioned, however, the Chinese government also doesn't like the social media to be so free in such a way that it can capture to take the limelight away from the authorities because authorities want it to be better controlled and so on. So there is this

hand and mouse game over time. And for the same reason, corruption has been evolving too. There are major cases of corruption in certain areas that have been cracked down and the problems have been addressed, for example, in securities listings and so on over time. But at the same time, a lot of the corruption have been transformed, including, for example, resulting to

cryptocurrencies and so on that the Chinese authorities have banned but continue to thrive away from China and so on. So there have been, again, a lot of these kind of developments over time.

And I think a big issue, therefore, is again that the authorities, the Chinese system, focuses on putting things under their own control, but not empowering the people to hold the system accountable. And I think that's the fundamental issue with the Chinese system. And thus far, the Chinese system has grown quite well.

And they have actually, as a result, have been able to deal with a lot of the issues that have arisen. But over time, however, as growth slows down dramatically, as a lot of the issues actually move underground, and as authorities actually have staff who have seen their pay cut in recent years as well. So the motivation within the system actually is a little bit, you know,

low morale mode. So that's a very interesting dynamic that's happening within the Chinese system. James, one last thing I wanted to get your thoughts on because we kind of brushed over it earlier in the podcast, but we were mentioning this kind of special supply of food and drinks to the Chinese leadership, the Tegong. Let's just finish up by telling listeners what the hell that's about.

So this is a decades old system that essentially creates a whole separate food supply chain for communist leaders from sort of the mid to high level up, I believe. There hasn't been a lot of reporting on it. There hasn't been a lot of coverage on it because it's very sensitive. Because again, in the same way as the food scandals hit the stomach, the idea that

that the privileged get to evade these food scandals is really sort of scammers. But it's a top to bottom chain. Like it goes from essentially like organic farms through to transport, through to the supermarkets or supplies or delivery that only certain people can access. And in some ways it's a kind of throwback to the old kind of like

pre-market economy days when there were all these different systems that you could only access if you had the connections, the power that allowed you to get foreign goods, for instance, allowed you to buy a car even in some cases. But this has stuck around, I think, for so long because it's something that people really know they want. It's the privilege you really protect because it fits so intimately to your safety.

Interestingly, when I've asked people about it in China, very few people knew about it. Unless they were in the system themselves or had access to it, they just didn't know it was a thing. And I think it's deliberately very downplayed because of that sensitivity. Yeah. Of course, it predicts the takeover of power by the Communist Party nationally existed before it actually was very much borrowed from the Soviet system. Right.

in many ways, but of course it's become very elaborate. And today, however, in China, there are, for example, local governments have dedicated farms and so on to provide some supplies. Even some companies themselves may do the same as well. Partly, and in certain cases, essentially because they have access to the land and they also want the convenience and so on.

But very often, we have special rules regarding the use of, for example, pesticides in particular, because many people recognize there is a serious issue. And a lot actually is related to the issue of commercialization and the issue of accountability, because as the supply chains grow longer,

people become much more anonymous and the growers don't consume their own products and then they care a little less unless there are strict regulations and that regulation is not always there. Yeah. Well, it's so interesting as you guys were saying that maybe this cooking oil one, given that it is potentially impacting the turgone system as well, might have a different outcome, but we'll wait to see how it does resolve and also wait till probably the next food scandal, which is never that far away

to be honest. James Palmer and Dali Yang, thank you so much for joining Chinese Whispers. Thank you so much. My pleasure. And thanks for listening to this episode. If you want to hear more about labour challenges in China, check out the episode of Chinese Whispers on the gig economy. And finally, remember, if you enjoyed this podcast, do give it a rating and a review and subscribe to it too. Thanks for listening.