Eight people connected with the Chinese business news website 21st Century Net were detained earlier this month by the police and charged with taking payoffs from financially vulnerable companies in exchange for flattering coverage. The scandal widened last week when the editor in chief and the general manager of The 21st Century Business Herald, the website’s print counterpart, were taken into custody. According to the Chinese state-run media, in recent years the website’s top leaders have accepted up to $50 million by brokering backroom deals with more than 100 companies.
The state-run media rushed to condemn the website’s employees as a few bad apples who blight the reputation of the entire profession. On CCTV, the state broadcaster, they were referred to as the “black sheep who threaten the welfare of the whole herd.”
Paying for news coverage — and paying to have news go unreported — is on the rise in China, along with other forms of bribe-taking and hush money that are known as red-envelope journalism. Unless the government is willing to treat corruption in journalism as a symptom of a society-wide infection, red-envelope journalism will continue to spread.
Corruption in journalism has its roots in the rapidly changing nature of the Chinese media landscape. Before 1978, all newspapers, magazines, TV and radio stations were owned and funded by the government. The primary qualification for a career in journalism was a politically solid background. Almost all writers, like those of Xinhua and other state-run publications today, worked under the supervision, and often explicit direction, of government propaganda offices in exchange for the security of being government employees — beneficiaries of the so-called iron rice bowl.
In the early 1990s, liberalization spurred a media boom. Greater freedom of the press was evoked, at least in name, but the more concrete change came in the reform of personnel recruitment. Due to economic decentralization and ineffective tax laws, the Communist Party could no longer afford to run news outlets the way it used to. Rather than being guaranteed stable salaries in perpetuity, writers and editors began to be hired on a contractual basis, with little job protection.
In recent years, the survival of any given publication, with the exception of party organs like People’s Daily, has come to depend largely on its ability to attract advertising. Because the government no longer subsidizes publications, the thousands of newspapers and magazines must now scramble to find their own sources of funding, and after years of being buoyed by the state, many have found the transition onerous.
The growth of social media has further intensified the competition. Censorship, pervasive if uneven, also continues to limit the ability of news outlets to compete on what they actually publish.
The asymmetry of liberalization — economic but not ideological — has rendered traditional journalists, whose poor pay has earned them the moniker “news laborers,” more susceptible to bribery. In 2002, two journalists from China’s official news service, Xinhua, reportedly accepted gold bars to cover up coal mine accidents. In 2009, 10 journalists were charged with collecting more than $300,000 for not reporting such an incident, which purportedly killed dozens.
In the same way that a news publication worked as one with its chief benefactor — the party propaganda bureau — 40 years ago, a news outfit today makes little distinction between its business and editorial sides. Indeed, journalism has usually been valued less as a means of providing reliable information than for its utility in furthering the ends of whoever has paid for it.
Some media outlets have admitted that there have been cases of red-envelope journalism, but none have dared to talk about it as a cultural phenomenon. There have been no major corruption probes into other publications.
Supervision at financial publications is generally more lax than at political ones, and the 21st Century Net website, which since 2010 has operated under The 21st Century Business Herald, a state-backed newspaper in Guangzhou, was conveniently positioned to weather risk and exploit opportunity. 21st Century Net was loosely supervised and under considerable pressure to garner advertising. By colluding with PR firms to identify image-conscious companies on the verge of preparing for their initial public offerings, 21st Century would bury unfavorable reports, thereby misleading potential investors, if the companies agreed to buy between $30,000 and $50,000 worth of advertising contracts.
“These companies’ demands were plain and simple: Just don’t write negative articles about us no matter what,” said one of the website’s top editors on state television after his arrest. “In exchange, we get what we call internally as a protection fee.”
It seems almost inevitable that market-dictated realities, coupled with low journalistic morale, would induce the sort of rule-bending that quickly spirals into corruption. As China presses on in its path of breakneck economic growth, it has also demolished its own safety net, which once guaranteed the professional class — including “news laborers” — some basic level of security.
In this sense, the scandal at 21st Century does not solely belong to certain journalists or even to the field of journalism alone. Red-envelope journalism has evolved symbiotically with a government whose legitimacy partly depends upon exercising the sort of control it may no longer be able to afford.
By JIAYANG FAN September 29, 2014 in The New York Times