In many respects, the plan outlined March 10 is a continuation of a three-decade process of state-led bureaucratic reform and reshuffling, albeit on a smaller scale than previous reforms. Over the years, these reforms have transformed the once-swollen Chinese government (which had more than 100 major bureaucracies in the 1970s and 1980s) into a significantly leaner 25 ministries employing about half as many civil servants as during the early years of Chinese leader Deng Xiaoping's "Reform and Opening" process.
Changing Priorities
The new plan includes the termination of the National Population and Family Planning Commission, which previously oversaw the formulation of population strategy and the provision of family planning services. Population strategy will become the responsibility of the much more powerful National Development and Reform Commission, while family planning will be handled by the new National Health and Family Planning Commission.
With this move, the state is sending a strong signal that family planning (and its core, the one-child policy) is a much lower priority now than in the past. In part, this reflects the deep unpopularity of the one-child policy. On another level, it signals the shift in China's demographic makeup, since the country's rapidly aging population and low fertility rate has cut into the large working-age population upon which China's current economic model is based. In an effort to offset these trends and counter the rising costs of a population that is aging too quickly to sustain the country's economic development, Beijing is showing that it is preparing to readjust its birth control policies.
Another priority shift is evident in Beijing's effort to streamline and consolidate its maritime enforcement agencies. This change reflects Beijing's goal of building a more coherent and integrated coast guard to support its increasingly assertive maritime strategy.
Perhaps the most significant institutional reform announced March 10 is the dismantling of the powerful and controversial Ministry of Railways. As with the former Family Planning Commission, the Ministry of Railways' responsibilities will be divided and transferred to other bureaucracies. The Ministry of Transport will now handle policy and administrative responsibilities, and the newly established China Railway Corporation will oversee commercial operations.
The abolition of the Ministry of Railways carries symbolic weight, since the ministry was widely perceived as the last major holdout from China's era of planned economy. Beijing had originally intended to restructure and tighten its control over the Ministry of Railways during the bureaucratic reforms as early as the late 1990s. But the ministry's long-standing ties to the military (during Mao Zedong's era, railways were considered a pillar of national defense) and its position as the centerpiece of national infrastructure development allowed it to resist Beijing's efforts. Over the years, the ministry's autonomy and lack of external oversight encouraged widespread corruption, overproduction, waste and a massive debt burden — problems that grew only worse after Beijing's 2009-2010 stimulus drive pumped hundreds of billions of yuan in credit into large-scale high-speed rail development. Following the February 2011 ouster of former Railway Minister Liu Zhijun and the July 2011 Wenzhou train crash, Beijing has taken advantage of the ministry's dismal financial straits and unpopularity to reassert closer central control and prepare to open railway construction and operation to competition.
Beijing's Broader Strategy
Bureaucratic reshuffles have been part of Beijing's broader political-economic reform package since the early 1980s and have become a more prominent part of Beijing's overall reform attempts. Particularly during China's transition from its planned economy to liberalization and opening to the outside world in the 1990s, bureaucratic reform became a centerpiece of Beijing's attempts to redefine the state's responsibility in socioeconomic activities, with the goal of gradually relinquishing the state's role and freeing up the market. As part of this, the institutional reshuffles made in 1993 and 1998 were designed to break up the state's monopoly over key industrial activities. These changes included the removal of 10 powerful ministries, including power generation, coal mining and heavy machinery, in an effort to introduce competition and to readjust the central government's role in oversight and strategic planning.
These reforms, made under Chinese leader Zhu Rongji, were an important step forward in the central government's longer-term struggle to streamline bureaucracies and reassert its own primacy over strategic planning in key sectors. However, the following decade was marked by enormous backlash from ingrained bureaucratic interests, and bureaucratic reform repeatedly led to re-expansion. Moreover, with the state's continued reluctance to relax its control over the economy, such bureaucratic reforms in many cases bolstered the state's role in socioeconomic activities.
Nevertheless, as Beijing continued fine-tuning its control over the ministries, institutions and policies that hold the basic structures of China's society and economy in place, the direction of bureaucratic reform reflected the Communist Party's vision of its relationship with the state regarding socioeconomic matters. Thus, Beijing's reforms sometimes changed course. For example, since the beginning of the 1990s, Beijing's approach to industrial streamlining and institutional reforms came alongside the trend of a broader bureaucratic consolidation, which Beijing in 2008 made clear in its strategy to promote the establishment of super ministries. Beijing may see the process as necessary to strengthening the Party's grip on power. Whether intentionally designed by the Party or as an inevitable result of the lack of change in the Party's strict control, the bureaucratic structural changes merely alter the institutions; only substantial political reform will readjust the relationship between the Party, the state and the market.
