MCLC: wealth watch

[Denton, Kirk]

MCLC LIST
From: kirk (denton.2 at osu.edu)
Subject: wealth watch
***********************************************************

Source: The Guardian (9/7/12):
http://www.guardian.co.uk/world/2012/sep/07/chinese-watch-signs-wealth

Chinese keep watch on signs of wealth as party preaches austerity
Cases such as the official with several expensive timepieces raise
questions about corruption and nepotism, experts say
By Tania Branigan in Beijing

Ferraris and Swiss watches may be catnip to a certain class of wealthy
Chinese consumer. But to the Communist party they are proving a headache,
an uncomfortably blatant sign of the wealth some have amassed.

There is no shortage of cases. In recent days one official, Yang Dacai,
faced scrutiny online for obtaining watches worth tens of thousands of
pounds on a salary estimated at about £1,000 a month. That was followed by
reports this week that the victim of a fatal Ferrari crash in March had
been the son of one of President Hu Jintao's key allies.

"Cases like the Ferrari and Yang cases hurts the regime's legitimacy
terribly," said Xiaobo Lu, an expert on corruption at Columbia University.
"The government has a huge challenge with the 'trust deficit'."

At best, such images highlight the growing gulf between China's rich and
poor, and the extent to which officials and their families appear to be
aligned with the winners. This year sharp-eyed observers drew attention to
the designer brands on parade at the annual session of the National
People's Congress, the largely rubber-stamp parliament that includes
numerous business tycoons, with some dubbing the event Beijing fashion
week.

At worst, they raise embarrassing questions about corruption and nepotism.
"I can't imagine that an official who is a fanatic when it comes to
procuring luxury watches is serving the people wholeheartedly," Wang
Wenyu, who sparked the Yang storm by posting pictures on Weibo, told the
Global Times.

Dali Yang, a political scientist at the University of Chicago, said
consumption that could not be supported on official salaries, combined
with behaviour that "flaunts one's wealth or violates norms … chip at the
credibility of the party, which tends to call for a more austere
lifestyle, and undermine popular trust. And when such incidents are aired
on the web, they can serve to galvanise public opinion."

The party's provincial discipline inspection commission was investigating
Yang Dacai's assets, an officer told the Global Times. Pictures posted
online showed Yang wearing at least five different luxury watches,
including, it was claimed, a Vacheron Constantin model worth between
200,000 and 400,000 yuan (£20-40,000).

Yang later said the most expensive was a Montblanc worth 35,000 yuan, and
said he had bought the watches over the course of a decade using his
legitimate income. Shortly after that interview, photos emerged of the
Shanxi official wearing six more watches.

A blogger using the name Huazong who has pioneered the tracking of
expensive timepieces – evaluating the watches of more than 300 officials
last year – said his work was "not necessarily a good anti-corruption
tool. It can't take the place of the government's anti-corruption organs.

"The key is to make officials' incomes public. Because all officials'
incomes are kept in the dark, ordinary people can only guess. They will
search about officials with luxury goods as a way to vent their pent-up
emotions."

He said the donning of luxury watches did not prove corruption, but did
tell observers something else: "Chinese officials are not elected,
therefore they will not care about their public images."

In a sign of the subject's sensitivity, Huazong's website was shut down
and police summoned him to "drink tea", a euphemism for an intimidatory
conversation.

The government has sought to rein in spending by officials, with orders to
eschew luxury cars and expensive banquets. An HSBC report on the luxury
sector in China says: "With challenging economic conditions, high-profile
graft cases and rising social tension driven by China's growing wealth
divide, there is a risk that corporate gifting may suffer as the
government clamps down on conspicuous consumption and gets tough on
corruption."

Lu said the premier, Wen Jiabao, had promised to look into implementing a
"sunshine law" requiring officials to declare their assets. "One can only
assume there is strong resistance to such tough transparency rules. But
without it, people will remain cynical," he said.