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One private passenger carrier that remains is Spring Airlines,a tenacious startup run by a founder so frugal that he shares a 100-square-foot office with his chief executive and takes the sub-way to business meetings.
That founder,Wang Zhenghua,survived in part by building his own computer reservation system.He canceled a planned interview.But in Chinese news reports,he was caustic about the state subsidies given his competitors.''Now with the injection of 10 billion yuan'' for China Eastern and China Southern,''everything is in chaos,'' he told Biz Review,a Chinese magazine.
China's private entrepreneurs have a catchphrase for such maneuvers:''guo jin,min tui,'' or ''the state advances,the private sector retreats.''
State-owned enterprises in China have taken the best of the economy for themselves,''leaving the private sector drinking the soup while the state enterprises are eating the meat,'' Cai Hua,the vice director of a chamber-of-commerce-style organi-zation in Zhejiang Province,said in an interview.
First in Line
Mr.Cai says he believes that China needs gov-ernment-run industries to compete globally and manage the country's domestic development.But locally,he said,their advantages -- being first in line for financing by state banks,first in line for state bailouts when they get in trouble,first in line for the stimulus gusher -- have created a ''profound inequality'' with private competitors.
Some analysts argue that the state-owned con-glomerates,built with state money and favors into global competitors,have now become political power centers in their own right,able to fend off even Beijing's efforts to rein them in.
Of the 129 major state enterprises,more than half the chairmen and chairwomen and more than one-third of the chief executive officers were ap-pointed by the central organization department of the Communist Party.A score or more serve on the party's Central Committee,which elects the ruling Politburo.They control not just the lifeblood of China's economy,but a corporate patronage system that dispenses top-paying executive jobs to relatives of the party's leading lights.
China's leaders have sought occasionally in the past year to curb speculative excesses by state-controlled businesses in real estate,lending and other areas.In May the State Council,a top-level policy body sometimes likened to the cabinet in the United States,issued orders to give private companies a better shot at government contracts -- for roads and bridges,finance and even military work -- that now go almost exclusively to state-owned companies.Virtually the same rules were issued five years ago,to little effect.
One private passenger carrier that remains is Spring Airlines,a tenacious startup run by a founder so frugal that he shares a 100-square-foot office with his chief executive and takes the sub-way to business meetings.
That founder,Wang Zhenghua,survived in part by building his own computer reservation system.He canceled a planned interview.But in Chinese news reports,he was caustic about the state subsidies given his competitors.''Now with the injection of 10 billion yuan'' for China Eastern and China Southern,''everything is in chaos,'' he told Biz Review,a Chinese magazine.
China's private entrepreneurs have a catchphrase for such maneuvers:''guo jin,min tui,'' or ''the state advances,the private sector retreats.''
State-owned enterprises in China have taken the best of the economy for themselves,''leaving the private sector drinking the soup while the state enterprises are eating the meat,'' Cai Hua,the vice director of a chamber-of-commerce-style organi-zation in Zhejiang Province,said in an interview.
First in Line
Mr.Cai says he believes that China needs gov-ernment-run industries to compete globally and manage the country's domestic development.But locally,he said,their advantages -- being first in line for financing by state banks,first in line for state bailouts when they get in trouble,first in line for the stimulus gusher -- have created a ''profound inequality'' with private competitors.
Some analysts argue that the state-owned con-glomerates,built with state money and favors into global competitors,have now become political power centers in their own right,able to fend off even Beijing's efforts to rein them in.
Of the 129 major state enterprises,more than half the chairmen and chairwomen and more than one-third of the chief executive officers were ap-pointed by the central organization department of the Communist Party.A score or more serve on the party's Central Committee,which elects the ruling Politburo.They control not just the lifeblood of China's economy,but a corporate patronage system that dispenses top-paying executive jobs to relatives of the party's leading lights.
China's leaders have sought occasionally in the past year to curb speculative excesses by state-controlled businesses in real estate,lending and other areas.In May the State Council,a top-level policy body sometimes likened to the cabinet in the United States,issued orders to give private companies a better shot at government contracts -- for roads and bridges,finance and even military work -- that now go almost exclusively to state-owned companies.Virtually the same rules were issued five years ago,to little effect.
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