Media Control and the Erosion of an Accountable Party-State in China

In recent weeks, a scandal of international proportions involving the consumption of tainted Chinese milk has emerged beginning with the Sanlu Group extending out to include 22 producers of baby formula—among them China’s major dairy companies Inner Mongolia Yili Industrial Group and Mengniu Dairy Company—impacted over half a dozen countries. Within China, the current toll of the milk scandal involves 53,000 sickened infants, 300,000 government inspectors mobilized, and RMB$7 billion worth of costs for the Chinese government (BBC Chinese Online, September 23;). Premier Wen Jiabao apologized profusely to affected countries at the United Nations General Assembly and promised to overhaul safety regulations for food, drugs and other products (Wen Wei Po, September 21). The scandal seriously calls into question the capability of the government to effectively regulate food quality and production, the value of an independent regulatory agency, and by extension how the party’s control over the economy and information undermines the independence of any regulatory system. “The system needs to be re-examined, top to bottom,” said Eliot R. Cutler, an expert on regulation and energy policy at the Beijing office of Akin Gump, an international law firm (New York Times, September 27). The public outrage over the scandal has focused on how the media could be tight lipped at the onset of the outbreak, with parents wondering how they could have fed tainted milk to their babies for months without realizing that their babies were being poisoned. For the public, this brings into question their confidence in government accountability and the media’s failure to warn the public.

There is plenty of blame to go around, with victims pointing their fingers at Sanlu. Sanlu is in turn blaming the local dairy farmers for tainting milk before shipping it to Sanlu, which would explain how the problem spread to 22 producers. Local government regulatory bodies have also been a logical target for criticism. It comes as a surprise that Sanlu—based in Shijiazhuang City in Hebei Province—is at the center of the scandal because of its impressive history: it was established in 1956, it is currently a government sanctioned national brand, and it was valued at $2.1 billion (RMB$14.9 billion) until recent events (Xinhua News Agency, September 16). Sanlu had won many awards, including a quality and efficiency award at the Hebei provincial quality award conference in November 2007 (Shijiazhuang Quality and Technical Supervision website, November 14, 2007). The government rated the dairy company as among the safest producers, and it has been exempted from mandatory inspections. When news of an outbreak was first reported on September 15, China’s Ministry of Health Vice-Minister Ma Xiaowei announced that Sanlu milk formula had caused the formation of kidney stones in nearly 10,000 infants who consumed the product—only days later, the number increased to over 30,000 infants affected. As of September 22, there have been a total of 53,000 infant victims in over 20 provinces, with 4 fatalities (World Journal, September 24).

Media Restrictions and Social Stability

The repercussions from the Sanlu incident have revealed the dangers of the Chinese Communist Party’s (CCP) discriminate censorship of information, which occurs in the backdrop of domestic fanfare that claims the media has been opening up in recent years. Since the days when the CCP came to power, it has made the importance of propaganda and control over public opinion a top priority. To control public opinion and ensure social stability, there has been a greater need to strictly control media and block reports on issues that are not conducive to maintaining social stability in order to ensure economic growth and avoid challenges to the party-state. Reporting on negative news—social movements demanding individual rights, public protests, corruption among officials—have generally been restricted. A recent example was when an August edition of the Economist critical of the Beijing Olympics was pulled off all newsstands throughout the country overnight. However, the countervailing pressure toward Beijing’s censorship elicited from the international community pressured Chinese leaders to loosen its clamp on the media, especially during the Olympics, by allowing foreign press to report throughout the country. The government has loosened media restrictions overall, but there is evidence that the party has also tightened it to specifically restrict negative reports that may harm the party’s image domestically. This about-face by the government may affect the public perception of the publically-beneficial role of the media, with the public thinking that media is becoming transparent, while it is still restrictive in certain instances that challenge social stability, economic development and party dominance.

There were several early reports of the Sanlu milk formula incident months before it was officially reported in the media. In Hunan, the General Administration of Quality Supervision, Inspection and Quarantine posted a letter on its official website dated June 30 by a concerned mother calling for a recall on powdered formula, media attention and medical exams for affected infants. Fu Jianfeng, editor at Southern Weekend, an independent newspaper publication in China, wrote in his personal blog that he discovered cases of sickened children as far back as in July, but could not publish articles “so close to the Games” for the sake of China’s international image (Central Daily News, September 30). In Gansu province, the Health Bureau spokesman Yan Jingke said his agency sent an urgent report in July to the Ministry of Health in Beijing about the incidences found in local hospitals (Duowei News, September 11). Yet the first individual to make an official report was the Shanghai-based Oriental Morning Post reporter Jian Guangzhou, who personally observed the phenomenon of kidney stone formation in infants and believed that many more would be affected if the news were delayed further (Northeast Web, September 11).

The Sanlu Group had covered up the severity of the situation by using the media to advertise the high quality of their products and to preempt suspicion. Sanlu’s most deplorable act was allegedly paying Baidu Web $430,000 (RMB$3,000,000) to restrict negative media toward the company (China Times, September 15). According to state media, Sanlu had received complaints about its powdered formula last December, yet Sanlu never issued a public warnings. On August 2, Sanlu company officials informed the board about the melamine problem, and a major Australian dairy company Fonterra, which owns a 43 percent share of Sanlu, pushed for a public recall only to be overruled by the rest of the board (New York Times, September 27). Mr. Fu wrote on his blog that when reporters discovered the tainted milk situation in mid-summer, Sanlu blocked reporting by using its political connections to prevent newspapers from publishing articles on the problem. It was weeks before the Olympics’ opening ceremony, and “we couldn’t do any investigation on an issue like this, at that time, in order to be harmonious,” wrote Mr. Fu (New York Times, September 27).

In China, there is a close connection between the government, private sector and media, with the party’s interests dominating all three. Over the past two years, the Central Propaganda Department had been issuing reporting guidelines in its classified Communist Party bulletin, emphasizing the promotion of good news about the Olympics (Central Daily News, September 30). Propaganda officials issued rules that made it mandatory for domestic publications to obtain permission before publishing articles about food safety and other politically sensitive subjects. The tainted milk problem was finally exposed in September when the New Zealand government contacted Beijing after a discussion with Fonterra executives. Chinese officials have stated that they had not known about the scandal until September, but a Fonterra spokesman said they believed the central government knew about the situation as early as August, the month of the Olympics (New York Times, September 27).

Restricting information can intensify an already serious public health situation, as with this case and with the Severe Acute Respiratory Syndrome (SARS), which was alleviated with broader public recognition of the problem. SARS is the flu-like disease that first surfaced in southern China in November 2002 before it spread to almost 30 countries and regions, infecting more than 8,000 people (5,327 on the Chinese mainland) and killing nearly 774, among them 349 on the mainland (People’s Daily, January 20, 2004). In the beginning, the CCP completely restricted information on SARS, but in the end Beijing was forced to report this phenomenon in order for take preventative public health education measures for the entire population, which finally resulted in controlling the spread of SARS. The differences between the two are that the root of the problem with SARS was from a virus found in nature, but the trouble with Sanlu was man-made. Thus, there are individuals who are culpable at the source of the Sanlu scandal. The latter more clearly indicates a regulation failure of the part of the government and the perils of media self-censorship. The similarities between the SARS outbreak and the Sanlu scandal are that they both started out with high media restrictions—conceivably to maintain social stability, party rule, “harmonious” Olympic games. Yet in the end open media reporting of the situation has been the most effective way to quickly stem the crisis.

Media Transparency and Integrating with the World

Since the late 1990s, China has begun to engage with and integrate into the world. Integrating with the world has domestic repercussions, as in 2007 when China exported toxic pet food that killed many pets in the United States and resulted in a recall of 60 million cans of cat and dog food that was tainted with the same chemical melamine (USA Today, April 2). In the current situation, toxic milk formula was not only sold to Chinese families harming Chinese infants, but related milk products were sold to many other countries, such as Singapore, Malaysia, Brunei and Bangladesh in Eurasia. Gabon and Burundi in Africa have all restricted imports of China’s milk products, sparking an international panic. In this way, integrating with the world means that China’s domestic regulatory failures have a direct impact on the rest of the world, which then reverberates back to the Chinese government.

Integrating into the world means that products must comply with international quality standards. Information transparency regarding repercussions of quality problems and efficiency of reporting must also be aligned with the outside world, since they will ultimately render judgment on China. When China’s tainted products reach foreign markets with free presses, these countries will exert exogenous pressure onto China. On September 22, the World Health Organization’s (WHO) Western Pacific Director Shigeru Omi made a public statement criticizing China for handling this incident with a lack of transparency and for misconduct in managing milk formula production (BBC Chinese Online, September 22). China had not proactively reported all similar cases to the WHO, such as toxic furniture sold to Europe, toxic seafood sold to North America, toxic pet food, and the toxic milk formula in this case. The Chinese media had limited domestic coverage of these past public health incidences. It is important to note that these previous cases were of a much smaller magnitude than what China is currently experiencing and they did not occur during such a sensitive time as the Olympics. In previous cases, the Chinese government had passively waited for the WHO to request an explanation before acting.

Media Transparency as Part of an Independent Regulatory System

Beijing had addressed past scandals by firing high profile officials, but this is not the systemic change needed to solve this problem. In last year’s food and drug safety crisis, Zheng Xiaoyu, the former head of China’s Food and Drug Administration was executed in a high-profile corruption case that served as a warning to lower officials (People’s Daily, July 10, 2007). His corruption sentence was another example of how government, businesses and media are closely tied in China. The following four-month crackdown yielded 1,197 criminal investigations, 300 closures of drug manufacturers, 192,400 closures of unlicensed food shops and 1,400 closures of sub-standard slaughter houses. Firing and executing top officials as warnings are futile attempts to solve the systemic problems by continuing to operate within the system. The problem still exists, and mass food contaminations will continue to repeat as it has with last year’s food and drug scandal, pet food scandal and toxic furniture example. It is the same core issue of ineffective regulation manifested in different outcomes in the past, as it will be in the future. Arthur Kroeber, managing director of a Beijing-based consultancy, said that the root of the problem is that the party is involved in pricing control, company management and flow of information, “the party views control of all three as necessary to rule, further major scandals are inevitable” (New York Times, September 27).

Although Beijing’s grip over the media had loosened to a certain extent during the Olympics, for instance Premier Wen Jiabao’s press conference to explain the Tibet crisis and China allowing more open foreign reporting in the country, the overall degree of press freedom is still a far cry below the international standard upheld by the world’s most economically vibrant and powerful countries. Though the toxic milk formula incident began with a cover-up, it ended with open reporting on a large scale because the authorities knew that transparency was the only way to solve the problem. As with SARS and other public health related incidences, widespread reporting and a concerted effort from the people were able to prevent a worse catastrophe. The government can use media to educate the public in order to help solve a social problem, and in reverse, a more open media can put pressure on the government to mobilize political resources to address a social problem.