Opinion / Editorials

Invigorating power cuts

(China Daily) Updated: 2014-11-07 07:53

The latest State Council decision to cut pre-approval requirements and make examination and approval processes traceable by all is a welcome follow-up to recent initiatives to shorten the list of matters subject to government approval. It is conducive to both investment promotion and corruption prevention, especially as the economic locomotive loses steam and the government struggles with credibility.

The less-than-inspiring growth figures and prospects call for powerful pushes. Loosening the grip of the government's "visible hand" may substantially invigorate our market-driven economy, and in turn reduce the government's burden of macro-control, as well as likelihood of rent-seeking.

That sounds as good as it can get, like many other ear-pleasing propositions in the past, thanks particularly to the pains taken to combine less government intervention and more transparency with enterprises' autonomy in choosing intermediary services.

But there is one truth that should never be underestimated: There are dozens of thousands of governments across the country, each having its own understanding of what the Cabinet truly means.

The latest proposals from the State Council sound forceful and unconditional. But such forcefulness can become vulnerable when "local conditions" weigh in.

Not to mention the obvious room left for manipulation. For instance, all matters that fall into enterprises' own autonomy should no longer be preconditions for approval, according to the new policy. But if each government can have its own definition of that autonomy, the clause may end up becoming toothless.

Even when it comes to intermediary services, a known hotbed for rent-seeking, leeway is readily available. Except for special needs that have the support of laws and regulations, no compulsory intermediary service or intermediary service agency should be designated. "Special needs" can be everything.

It is never easy to compose a one-size-fits-all policy for a country of 1.3 billion. That is why flexibility is a must.

But the same old trouble is some local governments and officials may take advantage of the State's concern about regional realities and compromise policy goals.

Since the new proposals are targeted specifically at potential rent-seeking and vested interests, it would be no surprise if they are rendered less aggressive in implementation.

As long as local governments are allowed to benefit from direct involvement in economic undertakings, it would be difficult to control their rent-seeking tendencies.

It is one thing to have them chant State Council-designated slogans. It is another to have them follow the latter's instructions.

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