Inter-Jurisdictional Relationships in the Chinese Political System

The People's Republic of China is by far the world's largest and most populous political system not to employ some form of federalism, Taiwan, Hong Kong and Macau notwithstanding.Footnote ¹ In contrast to their counterparts in federal countries such as India, and even in unitary systems like the United Kingdom, China's sub-national jurisdictions are instruments of administrative expediency rather than political representation or preference aggregation. The People's Republic is organized in hierarchical form, with province and municipal-level administrative units being both responsible for each subordinate level and responsible to each super-ordinate level. Accordingly, and again in contrast to most large countries, the Chinese system provides exceedingly few formal mechanisms for inter-jurisdictional cooperation or interest-bargaining between administrative units. Nonetheless, the People's Republic features stark regional variation in demography, culture and economic structure.Footnote ² How are these highly differentiated local and regional interests pursued within a notably centralized, hierarchical political system?

One way to address this question is to look at an issue which necessarily entails both horizontal relationships between sub-national jurisdictions as well as vertical relationships between central and local levels of government. This article examines the management of waterways which are shared between Chinese sub-national administrative jurisdictions, in the conviction that “Water, because it crosses administrative boundaries, forces different organizations and administrative units to do what they most abhor – deal with each other.”Footnote ³ In seeking general lessons on Chinese political dynamics from the specific case of water resource issues, this article follows earlier analyses of the role of various political actors, including both bureaucracies and civil society, in debates and disputes over issues like dam construction.Footnote ⁴ This analysis builds upon such previous work by using water resource issues to examine inter-jurisdictional as well as central–local relationships. The stakes in hydropolitics are growing: in 2011, the vice-minister for water resources conceded that China faces an “increasingly grim” water resource challenge.Footnote ⁵

Hydropolitics in China broadly encompass three inter-related issues. First, the proliferation of large dams and related water works has increased the supply of water for some areas while disrupting and inundating others.Footnote ⁶ Second, the over-utilization of major river systems, most notably the Huang He 黄河 (Yellow River), has created growing tension between water users in neighbouring provinces.Footnote ⁷ Third, increases in water pollution have catalysed serious disputes between upstream and downstream jurisdictions. These three issues are notable for being highly sensitive to divergent local economic interests. As a Wuhan University Law School study remarks, water resource issues and disputes are characterized by “a close relationship to local economies and local-benefit thinking on the part of some local governments.”Footnote ⁸ This aspect of hydropolitics in China challenges most of the literature on central–local relations. Scholarship in this arena has historically stressed vertical relationships between levels of government, but has largely ignored the dynamic and often contentious horizontal relationships which obtain among and between China's administrative jurisdictions.

Despite a long-standing aversion to “localism” in Chinese political thought and institutional design,Footnote ⁹ the challenges of ruling a large and diverse country have compelled successive regimes, including the People's Republic, to rely on sub-national agents at provincial and local levels for the exercise of most administrative functions.Footnote ¹⁰ This paradoxical phenomenon creates something of a conceptual challenge, which most Chinese political scholars have attempted to resolve with the aid of some variant of the influential model of “fragmented authoritarianism” (FA). An FA-based understanding sees Chinese politics as being animated by competing political interests beneath the apex of power, including the interaction of functional-bureaucratic actors, such as ministries, and territorial administrative jurisdictions, such as provinces.Footnote ¹¹ The FA model thereby explains variation in policy outcomes and implementation as well as opportunistic behaviour at local levels even within the confines of an authoritarian system.Footnote ¹²

However, schools of thought in China's central–local relations differ in the extent to which local agents are seen as being able to act independently and counter to the interests of their patrons at the centre.Footnote ¹³ The least strident strand of the literature views central–local relations as dynamic, such that power is fungible and autonomy variable depending on the issue, actors and circumstance in question.Footnote ¹⁴ A more strident strand emphasizes that the reach of the People's Republic has always been limited in particular segments of society, particularly in rural areas.Footnote ¹⁵ The most strident strand of the central–local relations literature holds that sub-national agents have gained real autonomy during the period of economic reform, to the extent that they are insulated from the exercise of central power in a system of “de facto” or “behavioural” federalism.Footnote ¹⁶ But, all three theoretical frameworks rely on central–local tension as the animating factor in Chinese inter-governmental politics, and understate the importance of inter-jurisdictional relationships in shaping the behaviour of sub-national actors.

In this article, I examine case studies where the central government did not employ its vertical control mechanisms to restrain the behaviour of competing sub-national administrative jurisdictions. As I detail below, this situation typifies hydropolitics in China because local interests outweigh those of the centre except in extreme cases. During the late 1990s, for instance, the Yellow River's failure to reach the sea became a national embarrassment, and the centre combined invasive regulation and intensive coordination with provincial-level authorities to restore flow.Footnote ¹⁷ But application of central coercion in water resource issues is exceptional, and in its absence, inter-jurisdictional horizontal relationships constitute the dominant force in Chinese hydropolitics. In this article, I examine these relationships, and in particular how competing localized interests are pursued in several cases. In each, the central government sets the rules of the game, but the players are sub-national, and their strategies are calculated to gain at the expense of their competitors. They thereby illustrate the importance of horizontal conflictive relationships between sub-national administrative units in understanding Chinese central–local relations.

I draw on open-source material to select three cases manifesting each of the hydropolitical issues described above: water project construction, namely the Daliushu High Dam (Daliushu gaoba 大柳树高坝) near the border of Gansu and Ningxia; water resource allocation, namely the Yellow River Water Quantity Allocation Plan (Shuiliang peihe fang'an 水量分配方案), which allocates water among Yellow River basin province-level jurisdictions; and finally, water quality, namely a water pollution dispute between municipalities in Zhejiang and Jiangsu provinces. In each case, I rely on documentary sources to examine sub-national interests and behaviour, and key-informant interviews to illuminate central-level interests.Footnote ¹⁸ This approach was taken because sub-national interviewees often claim to be implementing centrally-formulated policies, even while demonstrably failing to do so,Footnote ¹⁹ and also to assess potential bias in case study selection, which was based partly on information availability. My informants, each of whom is familiar with water resource issues in China as a whole, indicated that while my cases may be especially poignant, and therefore over-represented in media and official sources, they are not anomalous.Footnote ²⁰ Moreover, these cases evince a consistent pattern: administrative units formulate divergent preferences with respect to shared water resources, and pursue these objectives through strategies of direct competition and conflict with neighbouring jurisdictions.

This article thus challenges a hierarchical view of central–local relations by examining the pursuit of divergent preferences through horizontal local–local conflict and competition. In doing so, I draw upon an element of the FA model which describes horizontal bargaining between bureaucratic units of equal rank,Footnote ²¹ as well as the FA-inspired account of China's “soft centralization” in which provincial-level administrative units have assumed growing importance in policymaking.Footnote ²² However, I refine the FA-based understanding of inter-jurisdictional relationships by detailing specific strategies used by sub-national administrative jurisdictions to pursue divergent preferences within China's centralized hierarchy. I also make the broader argument that although the Chinese system employs several mechanisms to reduce preference-divergence between central and local actors, China generally lacks the effective means to solve horizontal collective action problems between administrative units of equal rank. Hydropolitics in China are thus symptomatic of a dichotomous structure of its central–local relations, in which horizontal competition and conflict occur within a system of vertical central control.

I pursue this argument in three steps, each corresponding to a different section of this article. First, I review in detail extant literature on central–local relations to describe how China's centralized political structure constrains the centre's ability to solve inter-jurisdictional collective action problems. Second, I describe how processes of fiscal decentralization since 1978 promote competition between administrative units for increasingly scarce water resources. Third, I provide evidence for this argument by means of three case studies. I conclude by drawing some general implications from my argument for further analysis of inter-jurisdictional collective action problems in China. Before proceeding, however, the structure of vertical control and the circumstances under which it permits horizontal conflict bear further elaboration.

Stalling: the Daliushu Dam Dispute

The first strategy for pursuing individual jurisdictional interests within China's centralized system relies on playing different elements of the central government bureaucracy against one another. This “stalling” strategy seeks to prevent the central government from employing its coercive resources in order to favour one jurisdiction's preferences over those of another. The stalling strategy is likely to be most effective when employed by province-level units, since they enjoy ministerial-level rank within the Chinese bureaucratic system and can operate on a formally equal footing against central government ministries. Such a strategy is illustrated by the Daliushu Dam dispute, which arose in 1954 when the Yellow River basin comprehensive development plan proposed construction of a dam at a site near the border of Gansu province and the Ningxia Hui Autonomous Region.Footnote ⁵⁹ This proposal pitted provincial interests against one another in a particularly direct way: a high dam could provide water to irrigate a large portion of Ningxia, but would inundate a substantial area of Gansu, while a lower dam would minimize inundation but store less water and generate less hydropower.Footnote ⁶⁰

Consequently, almost from the outset, Ningxia and Gansu adopted competing preferences for both the height and siting of the dam. In 1958, the Ningxia government issued a document calling for a high dam at Daliushu 大柳树 so as to irrigate more farmland within its borders.Footnote ⁶¹ The Gansu government objected to this proposal, calling instead for a dam within its own borders at Xiaoguanyin 小观音. This initial dispute prevented dam construction through 1981, when, following a sustained lobbying campaign by Ningxia, the Inner Mongolia government expressed its support for Daliushu. In response, Gansu announced soon afterwards that it would support both the construction of a high dam at Xiaoguanyin and a smaller dam at Daliushu.Footnote ⁶² Subsequently, the two provinces have continued to stall both projects through lobbying different elements of the central bureaucracy as well as the public at large. Indeed, the Daliushu case is of particular note because in recent years both governments have established websites advocating their respective positions, thus bringing the debate into the public eye.Footnote ⁶³

Both governments claim to have important elements of the central government on their side. Ningxia claims that the Ministry of Water Resources (MWR) and a State Council commission both support construction at Daliushu,Footnote ⁶⁴ while Gansu stakes its claim on the fact that its proposed dam at Xiaoguanyin was approved by the State Planning Commission in 1975.Footnote ⁶⁵ But neither province has been content to rest on these claims. The Ningxia government has courted State Council delegations sent to resolve the dispute by escorting them to impoverished villages it claims will be irrigated with the Daliushu project, and in 2010, Ningxia's delegates to the National People's Congress submitted a petition en masse to start construction of Daliushu dam as soon as possible.Footnote ⁶⁶ Gansu, for its part, has enlisted outside experts to its case, and contracted the China Hydropower Consulting Group in 2001 as part of a renewed push for construction of the two-stage dam project. Unsurprisingly, the consulting group's report endorsed the Gansu government's two-stage dam proposal, even claiming that the Daliushu project may cause major earthquakes.Footnote ⁶⁷

The two governments also compete publicly by arguing that their respective proposals best further socio-economic and national development objectives. Ningxia argues, for example, that the Daliushu project is vital to improving regional water security and to poverty alleviation and socio-economic development.Footnote ⁶⁸ In addition, however, it asserts that the project will promote full implementation of the “open up the west” development programme, a national-level strategic objective.Footnote ⁶⁹ Perhaps most poignantly, an article featured on the Ningxia government's Daliushu website argues that the Xiaoguanyin project would be a “long-term error in decision-making” (changyuan de juece shiwu 长远的决策失误).Footnote ⁷⁰ Gansu, for its part, argues that the two-stage project would avoid inundating its most agriculturally productive region, thereby preventing “grave social problems.”Footnote ⁷¹ Gansu also asserts that a two-stage project is necessary to meet increasing energy demand in the north-west region and to fulfil national energy policies such as the National Renewable Energy Plan.Footnote ⁷² Gansu and Ningxia have thus succeeded in pursuing localized interests within a centralized system by exploiting bureaucratic fragmentation at the centre, thereby stopping the centre from employing its coercive resources to preference one side over the other.

Stealing: Over-Abstraction from the Yellow River

A second strategy for pursuing localized interests within China's centralized system relies on sleight-of-hand to “steal” resources allocated to other jurisdictions by the centre, and is illustrated by over-abstraction of Yellow River waters by both province and municipal-level jurisdictions. Beginning in the early 1980s, increasing tensions between water users along the Yellow River led the central government to devise an inter-provincial water allocation plan. The plan, which was formulated by the then-Ministry of Water and Power and approved by the State Council in 1987, was based on extensive consultations with provincial governments on projected water needs (see Table 1).Footnote ⁷³ Because the plan reflected the pattern of economic development in the early 1980s, however, it substantially favoured the downstream provinces, particularly Shandong.Footnote ⁷⁴ This allocation has become increasingly unrealistic, and jurisdictions not so favoured by the 1987 plan have responded by exceeding their abstraction quotas. Importantly, this is accomplished by exploiting vulnerabilities in the monitoring system established by central bureaucracies, including by over-abstracting water from tributaries to the Yellow River where the centre lacks flow-monitoring stations.

Table 1:

Yellow River Available Water Quantity Allocation Plan (Prior to SNWTP) (100 Million m³)

Source:

Li, Dong 2010.

This behaviour is acknowledged by the centre. A 2011 report admitted that “In implementing the Yellow River water quantity regulations, there exist some localities which do not put into practice the water quantity allocation and dispatch plan, and exceed the allocation limits in using water resulting from inter-provincial flows not according with control limits.”Footnote ⁷⁵ Another report more obliquely notes that, “a small number of local governments and departments use administrative measures to interfere with normal management, making it difficult for Yellow River water administrative entities to control and regulate” water use.Footnote ⁷⁶ A recent news report, though, is far more direct, asserting that provinces skirt Yellow River allocation rules by extracting water from Yellow River tributaries before it enters the main stream. “Tributary water quantity allocations are not clearly defined,” the report notes, “meaning that each province can utilize water before it enters the Yellow River, and before it becomes part of the Yellow River water quantity allocation limits.”Footnote ⁷⁷ Thus, while not directly undermining centrally formulated policy, individual jurisdictions nonetheless attempt to steal water from their neighbours to supplement what they view as an unfair and unrealistic allocation.

The centre has taken some steps to address this situation. Regulations and monitoring of water use were strengthened considerably in the late 1990s in response to the Yellow River's failure to reach the sea, and these efforts have succeeded in maintaining minimum stream flows to the lower reaches.Footnote ⁷⁸ However, this successful application of the centre's coercive power has not extended to reconciling the divergent preferences of Yellow River jurisdictions. Downstream jurisdictions have successively prevented further reform of the 1987 allocation, despite its widely acknowledged obsolescence given the rapid development of the middle and upper reaches, climate change, and groundwater depletion.Footnote ⁷⁹ In spite of these deficiencies, the centre has expressed no desire to modify the original plan.Footnote ⁸⁰ Interviews with water resource specialists indicate that this hesitancy is owing to the difficulty of negotiating with provincial governments, particularly those which, like Shandong, benefit disproportionately from the present quantity allocations.Footnote ⁸¹ As an MWR official explained, such negotiations are “a game, and it's hard [for the central government] to play.”Footnote ⁸² Individual jurisdictions along the Yellow River have thus skilfully exploited gaps in the system of vertical control to make competing demands on scarce water resources.

Shirking: Polluting Downstream Jurisdictions

A third strategy for the pursuit of individual jurisdictional preferences is shirking centrally formulated policy objectives. This strategy is illustrated by the case of selective implementation of water pollution regulations, which pit environmental protection objectives against local economic interests, particularly in jurisdictions which lie upstream of their neighbours.Footnote ⁸³ In recent decades, the central government has adopted a number of measures intended to address the growing problem of pollution on inter-jurisdictional waterways. China's principal water laws articulate general principles for resolving inter-jurisdictional disputes through “negotiation and consultation,”Footnote ⁸⁴ and the National People's Congress has developed special instructions on dealing with such disputes which indicate that higher level governments should issue binding directives when efforts at informal inter-jurisdictional negotiation fail.Footnote ⁸⁵ Despite these efforts, however, upstream municipal-level jurisdictions routinely attempt to shift the burdens of water pollution control onto their downstream neighbours,Footnote ⁸⁶ as poignantly illustrated by a dispute between municipal-level jurisdictions in Zhejiang and Jiangsu that is sometimes referred to as the “blocking dam” incident (zhuba shijian 筑坝事件).

Beginning in the 1990s, pollution from the printing and dyeing industries in Suzhou 苏州, Jiangsu province, began to heavily degrade water quality in downstream Jiaxing 嘉兴, Zhejiang. In 1993, a large number of fish died in the waterway which flows between the two cities, leading to a number of appeals by Jiaxing residents for compensation from Suzhou.Footnote ⁸⁷ Despite several central-level interventions, including an agreement brokered by the State Environmental Protection Administration (SEPA) requiring that Jiangsu province maintain prescribed levels of water quality as it flowed into Zhejiang,Footnote ⁸⁸ downstream water quality did not markedly improve. In 2001, Jiaxing residents created a fund to buy old boats and other objects, which were subsequently and deliberately sunk in the waterway, forming a dam which backed up the polluted water into Jiangsu.Footnote ⁸⁹ This incident provoked an immediate but ponderous response: the State Council issued “comments” (pishi 批示), which were translated by an MWR work group into a “seven basic principle opinion” on the basis of consultation with provincial-level water resource bureaus, as well as a separate “four-point resolution opinion” negotiated by SEPA after consultation with leaders from each province, both of which were eventually delegated to separate work groups for implementation.Footnote ⁹⁰ This application of the centre's coercive power was ultimately successful: the dam was eventually removed.Footnote ⁹¹ However, the complexity of the centre's intervention also illustrates the high cost of regularly applying this power.

The Jiaxing case represents the pursuit of individual jurisdictional preferences in a particularly pure form. Embedded in a system of vertical control and responsibility, Jiangsu authorities had few incentives to cooperate with Zhejiang officials prior to State Council-level central intervention. As Peng Huan's assessment of the case concludes, “local administrative fragmentation often leads to pollution prevention and control entities ‘sweeping only their own doorstep’ [zi sao menqian xue 自扫门前雪] when it comes to regulation.”Footnote ⁹² Similar conclusions are expressed in the case of Taihu Lake 太湖, another notable case of inter-jurisdictional water quality conflict.Footnote ⁹³ Driven by divergent jurisdictional interests, such horizontal disputes often fester owing to the lack of suitable inter-jurisdictional dispute resolution mechanisms. As one interviewee explained, central ministries like the MWR are both “players and referees” (yundong yuan, caipanyuan 运动员, 裁判员)Footnote ⁹⁴ in trans-boundary water resource disputes, leaving actors in the vertical system of control ill-equipped to resolve these issues.