Nick Cohen

How British managers and Chinese communists are destroyed by the perks they take for granted

How British managers and Chinese communists are destroyed by the perks they take for granted
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On the face of it, Lu Wei, the former director of China’s Cyberspace Administration, and Professor Max Lu, vice chancellor of the University of Surrey, have little in common. Mr Lu was the world’s most powerful censor. He maintained the great firewall of China and did all he could to stop 730 million Internet users reading or seeing anything the Communist Party might not approve of.

Professor Lu, by contrast, is an authority on chemical engineering and nanotechnology. When Surrey appointed him a delighted spokesman  exclaimed he was one of ‘only 150 double highly cited academics in the world, with over 500 peer-reviewed articles published in top journals, attracting more than 31,000 citations’. By all accounts, Professor Lu is a brilliant man, as dedicated to opening the world to inquiring minds as Mr Lu is to closing it.

The Chinese Communist party has now charged its former enforcer with taking advantage of his position to receive 'a huge amount of property', and of shamelessly trading 'sex for power'. With the shrill invective communists have mastered since the days of Lenin, the party accused Mr Lu of being 'inflated with ambition,' and 'wanton'. He was, it concluded, a 'typically two-faced person'.

Meanwhile back in Guildford, the worst that can be said of Professor Lu was said by Channel 4 on Monday in its investigation into the expense accounts of Britain’s vice chancellors. While his fellow vice chancellors showed that the wine list at high table is not what it was when they claimed 'pornstar Martinis' on expenses, the station revealed that Lu made the University of Surrey spend £1,600 transporting his pet dog, a Maltese called Oscar, since you asked, from his old home in Queensland.

It hardly seems fair to compare them, but British managerialism and Chinese communism set near identical traps for men and women who benefit so gratefully from their favours. Both systems are widely hated but under no serious threat. But neither is as strong as it seems. Individual managers in Britain and individual communists in China find that the rewards they take for granted can still destroy them.

Here is how the trap snaps shut.

Britain has engaged in an experiment ever since Margaret Thatcher’s day. Destroy the trade unions, the theory ran, and managers will be liberated to innovate and produce riches. ‘Managers must have the right to manage’ the slogan of the 1980s maintained – although as many of us noticed at the time, its corollary 'workers must have the right work' never had the same prominence. If the Thatcherite dream of unleashing management creativity were true, Britain would be full of world-beating companies.

Yet British managers are on the whole mediocrities. Lavishly paid mediocrities, I grant you. But mediocrities nevertheless. it see Productivity in UK companies still lags behind other advanced economies. All that has changed are the salaries and bonuses. It would take a UK worker on a salary of £28,000 (median full-time earnings) 160 years to earn what an average FTSE 100 CEO is paid in just one year. Notoriously, corporate excess has spread into the public sector although to nothing like the same degree.

You might have expected an upsurge of union organising. It would have been more than justified. But in the private sector trade unions barely exist. As 'Hired', James Bloodworth’s superb exploration of zero-hours Britain makes clear, there’s a great mood of fatalism among the working class. Collective action is seen as a waste of time and a dangerous waste of time in many companies. None of which means that people at the top are safe. The system may endure but individuals can still fail precisely because they pocket the rewards their contemporaries take for granted.

If a future Labour government wants to renationalise the utilities, its propagandists will soften up the public by attacking the pay of the energy and water company bosses. The £4.6 million John Pettigrew, the chief executive of the National Grid received last year — plus a £500,000 relocation allowance when the company moved office – is not when you think about it much of an argument for or against nationalisation. But most people are instinctively repelled by his pay and the pay of his colleagues and conclude that any system that allow it must be rotten. Why should a bureaucrat be paid so much for running a public service? When and if the time comes to take over the privatised utilities, pay which is normal in the boardroom, will be seen as an intolerable aberration

You can see the process at work in the universities. The £1,600 Surrey paid Professor Lu for the cost of moving his dog or the £468,000 pocketed by Dame Glynis Breakwell, Bath University’s now famous vice chancellor, is loose change when set against the higher education budget. But the universities cannot justify attacking the pension rights of lecturers or putting students into half a lifetime of debt when their leaders have no moral authority. Be assured ministers either in this government or the next will use the luxurious culture at the top of the universities as an excuse to tear into them.

While they wait, academics might want to consider Mr Lu’s China. President Xi Jinping doesn’t want to end corruption in China. His own family has managed to accumulate over $1 billion in wealth, according to reports by Bloomberg. The absence of the rule of law and property rights guarantee that the one-party state will be corrupt. Just as the absence of strong trade unions guarantees that mediocre British managers will be over rewarded. Rather than challenge the system, Xi uses corruption as a weapon against his enemies. You can guarantee that if an official is seen as an opponent of his plans to take more power he will be arrested on corruption charges, and then his supporters be ushered towards the empty space at the trough.

As one China scholar put it,

Xi’s anti-corruption campaign is reshaping the magnitude and composition of the ruling coalition and the size of the payoffs to remaining members, thereby strengthening his own hold on power.

A world divides Mr Lu and Professor Lu. But as everyone says, globalisation is making the world smaller.

Written byNick Cohen

Nick Cohen is a columnist for the Observer and author of What's Left and You Can't Read This Book.

Topics in this articlePoliticschina