How not to lose your shirt in China

Each time I write something about human rights in China, as I did recently in The Spectator, I receive e-mails from men, always men, doing business in China whose message is this: China is becoming a world-class economic power with its own moral standards, so why don’t I shut up and praise it for its tremendous accomplishments?

Now comes James McGregor with this simple message: ‘The sad fact is that the Chinese system today is almost incompatible with honesty — almost everybody is at least a little bit dirty.’ And since McGregor’s book is a guide to doing business in China, here is some of his advice: ‘Once you get below the level of the big multinationals doing large deals, China becomes a swamp.’ American companies, he notes, are ‘forbidden from engaging in any form of bribery by the Foreign Corrupt Practices Act.’ So,

American attorneys help multinationals [which he had just said don’t do this] to draft contracts that do what they call ‘papering over’ the FCPA. ‘Once you go through that process, you want as little information as possible,’ said a veteran China attorney. The company’s China boss keeps that one copy in his office safe so that if internal auditors begin an enquiry, he can destroy the contract quickly.

Some executives embark on a course of ‘don’t ask, don’t tell,’ says McGregor, but he recalls several American executives ‘who couldn’t wait to escape from their Chinese assignments because selling their soul or wrecking their career was an unspoken daily dilemma’.

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Samuel Gregg

The welcome fall of Klaus Schwab

His book is chock-full of concrete tips and riveting arcana about how not to lose your shirt in China, and maybe make some money. One rule:

If you are looking for justice and fairness in China, remember that the Communist party, like the 2,000 of imperial rulers who came before it, considers the ultimate justice in China to be whatever maintains the system and its stability.