Chapter 17 4. Top 10 Surveys Part 2: Institutions in China

The commodity economy dominated by the market system is an open economic model. In this economic model, all economic subjects are required to realize self-management and conduct business games in accordance with market rules. When the country combines power and capital At that time, the power formed is absolutely difficult for ordinary operators to match. In the face of state-owned capital, private capital can only advance and retreat freely and continue to develop only if it always adheres to the standpoint of cooperation rather than competition, supplementation rather than substitution, and subsidiary rather than overriding.

Introduction to the topic: A common institutional topic——the tragedy of "retirement of the country and advancement of the people"—the game study of politics and business From history to reality, we have returned to the discussion about the system. In China, what kind of entanglement will occur between the new profit-oriented system and the old political-oriented system? This is actually a question that has been demonstrated by countless people, almost like a cliché.The reason why we are still talking about old problems is that state commercialism has always existed, and in the past 10 years, China's economic growth has increasingly shown the appearance of state commercialism.

In fact, the emergence of state commercialism is definitely not an accidental phenomenon. What we already know is that the state-owned property rights system we have implemented in the past means a kind of state intervention and regulation of social and economic behavior, but in reality, any country or government in the world will inevitably carry out social and economic development. Intervention and regulation are not only the innate ability of the state, but also the concrete manifestation of the will of the state. If we look back at history, we can find that state commercialism is not a new thing; the state actively participates in and regulates commodity and currency activities, and cooperates with other policy means to seek political and economic interests to the maximum extent. It has lasted as long as 2000 years in Chinese history.Even in contemporary Western capitalist countries, it is still the mainstream discourse in economics, because there are indeed reasonable places in it.

When the country makes good use of market rules, when the country masters economic laws, when the country actively participates in and regulates commodity and currency economic movements, when the country focuses on the future and actively escorts private enterprises, Its role in regulating national income, inhibiting vicious competition and excessive expansion of capital, and supporting the private economy are all decisive. In addition, the existence of state commercialism can directly create huge financial resources for the government. Income, to achieve the ultimate goal of "all citizens are rich" as soon as possible.

However, as with anything, the rise of state commercialism has had a polarizing effect. Although state intervention is a necessary condition for social and economic development, when the state intervenes in economic activities as an operator, its purpose of competing for interests becomes obvious. In addition to capital, the state In his hands, he has a condition that ordinary private operators do not have-political power. There is no doubt that the commodity economy dominated by the market system is an open economic model. In this economic model, all economic entities are required to realize self-management and conduct business games in accordance with market rules. When power and capital are combined, the power formed is absolutely unmatched by ordinary operators.

So we can see that in the process of clarifying property rights, when there are differences of thought between the local government and entrepreneurs, the result of the game between politics and business often ends in the rapid decline of the enterprise. In the general pattern of macro-control, when private enterprises try to enter the heavy industry and monopolistic fields, they often achieve some gains in operation, but they have to face policy risk factors. Due to the wrong judgment of the macro situation, in In each round of macro-control, many private enterprises have fallen to the ground in areas that have received key policy governance, and many of them are even familiar names.

When the time went to 2002, the strategy of "retire the country and advance the people" implemented by the central government had been in operation for four years, and more than 40% of the state-owned enterprises had either disappeared or changed their property rights in the process.Its strength is not insignificant, and the fresh vitality it brings to the Chinese economy is obvious to all. However, just as the Chinese economy was advancing vigorously, a series of jaw-dropping tragedies suddenly occurred in the Chinese business community. However, he still has doubts about the changes in China's economic system.

In the wave of "retirement of the country and advancement of the people", due to the division of interests in the system reform and the game between politics and business in the process of clarifying property rights, private enterprises that should have been more vigorous in the field of market competition have emerged in various fatal situations. crisis. The most shocking tragedy happened to the famous Jianlibao. Until 1998, it was still the leader in China's beverage industry in terms of output, output value and profit tax. But what is unknown is , the relationship between its head, Li Jingwei, and the local government has become tense due to differences in property rights.

Under the premise of retreating the country and promoting the advancement of the people, selling Jianlibao to private capital has almost become the consensus of everyone. However, what is surprising is the attitude of the local government towards the sale—it can be sold to anyone, but it cannot be sold. To Li Jingwei. In this way, on January 15, 2002, the local government made a unilateral decision to transfer 75% of Jianlibao’s shares for 338 million yuan. According to statistics, Jianlibao’s total assets at that time were as high as 3.5 billion yuan, only its book value There is a huge amount of 650 million yuan.

It is said that on the day of the signing and transfer, Li Jingwei "looked at the sky with tears in his eyes and said nothing" on the venue, which moved almost everyone. After the transfer, Jianlibao quickly fell into a situation of wrong business decisions. In 2004, it was even on the verge of bankruptcy. Finally, in 2007, Jianlibao, which had become a second-rate enterprise, was transferred to Taiwan Uni-President Group again. Not only did it lose its former glory , so much so that we can only find this name in our memories. A similar tragedy happened on March 11, 2002, and this time the protagonist was Brilliance Auto.

Different from Jianlibao, the reason for Brilliance Auto’s tragedy lies in the competition of local interests. In Brilliance Auto’s strategic plan, the company must expand to other regions and form an industrial advantage with a national layout. However, in the fierce competition of regional economy, all regions hope to firmly control resources and enterprises, and there is strong hostility between regions. Therefore, when Brilliance Automobile hopes to launch a new project in Ningbo, Zhejiang, An unexpected situation happened. When Liaoning Province, where Brilliance Auto is located, realized the momentum of Brilliance's "running away from home", Brilliance Auto naturally fell into a battle for interests between regions, and this time the outcome of the political and business game was: not only Brilliance's strategic planning It became a bubble, and its entire enterprise was also placed under the name of the Liaoning government at one time. Four years later, Brilliance, which originally had an annual profit of 1.8 billion yuan, has fallen to a huge loss of 400 million yuan, and even the factory production is almost at a standstill. In addition, a large number of enterprises such as Guangdong Kelon Electric Appliances and Chunlan Air Conditioning Group have also suffered heavy losses in the political and business game. Flow into a river. Such stories have happened continuously in the past 10 years. What we know and say is only the tip of the iceberg. Among the countless failed cases, the phenomenon of political and business games is too frequent, which leaves us with endless sighs and sighs. and questions that need our thinking. The question is – why are so many businesses caught up in the entanglement of the old and new economic systems?And, for a long time to come, how should Chinese business operators deal with this situation? In the protracted political and business game, the weak position of private enterprises is self-evident. In the entanglement between the two systems, our private enterprises have paid a heavy price for this. Constrained by our long tradition of national commercialism, for quite a long time to come, the boundaries between politics and economics will not be separated as some experts predict, and will certainly continue as before. It is precisely because of the existence of this feature that our entrepreneurs must master a kind of political insight and accomplishment in addition to business operations. A typical example is Wu Renbao, the head of Huaxi Village. During his 48 years as the village party secretary, he had to read newspapers and watch TV news every day to grasp the pulse of the political situation.So we can see that in the 48 years, Huaxi Village has become an advanced model in almost every period, which has brought about geometric growth in wealth. At many critical moments, this kind of insight of entrepreneurs is the key to determining the fate of enterprises. We have seen that many outstanding entrepreneurs in the past 10 years have all shown amazing talents in business, but they are in the game of politics and business. Mishandling among them dragged the enterprise into the abyss of falling. As an entrepreneur who survived the intricate system entanglement, Feng Lun, chairman of the board of directors of Vantone Group, made this assertion: "In the face of state-owned capital, private capital can only advance and retreat freely and continue to develop if it always adheres to the standpoint of cooperation rather than competition, supplementation rather than substitution, and subsidiary rather than overriding." When an entrepreneur makes such a judgment, we cannot but be dumbfounded. This is not only the helpless voice of the cuckoo crying blood, but also a true portrayal of survival in the cracks. , For almost ten years, this decade can be called the most thrilling decade for Chinese entrepreneurs. In the next ten years, due to the further strengthening of state commercialism, it will be difficult for the market economic system to coexist outside the planned economic system. Therefore, small changes in policies will still have a significant impact on the private economy, whether it is Whether future entrepreneurs or existing operators, they must learn the ability to analyze the business environment and understand the essence of "political and business game science" in addition to pure business thinking. It is foreseeable that in the next few years, centering on monopoly industries, capital reorganization activities will occur repeatedly. When the country is committed to the reorganization of state-owned capital, all we need to do is be cautious. After all, in addition to business challenges, we need to face too much.