In 2008, China underwent the poisoned baby milk scandal. There had been problems with the global food crisis of that year, cattle feed was too expensive for China's poor farmers. The "solution" to this problem was to put melamine, a poison industrial chemical, into the supply chain, in order to boost the measured protein content in the milk. This melamine wound up, eventually, in baby formula. Several babies died, and houndreds of thousands of others were sickened, often with kidney stone ailments and other serious problems.
One man, Zhao Lianhai, decided to do something. He had been an official in the Chinese food safety department. His own child had become ill from the tainted milk, and so he began to form a movement.
He created a website called 'Home for Kidney Stone Babies'. Other parents gathered there and exchanged advice and stories, and started to plan on ways to get redress from the government. He exposed corruption, such as posting allegedly leaked documents from a hospital that proved that officials were being pressured by the government to downplay the consequences of the scandal upon the health of infants. He organized meetings and protests with the other parents.
The government came down on him, hard. He was arrested and sentenced to several years in prison. His family members and his associates were harassed and persecuted by the state officials. His website was shut down.
After a great deal of pressure, the government let him go, after he agreed to some sort of false confession of his 'crimes'. After he was released, he recanted the confession, unable to bear the cognitive dissonance swirling around inside his head.
Melamine was also discovered in Chinese eggs.
Now, Chinese companies have been producing fake plastic rice, and selling it to poor people. The solution given by the government is to increase regulation. They claim that this will solve the problem.
It is baffling. They have the answer at their fingertips - their own population is wanting to participate in the regulation, like Zhao Lianhai, but instead they are persecuted. It is enough to make one agree with Alan Greenspan in his book Age of Turbulence. His argument went something like this: More regulation doesn't necessarily accomplish much. It allows corruption to become more 'legitimized' by the institutions that are supposed to be regulating it. Greenspan, instead, spoke of the importance of whistleblowers, from inside organizations, coming out and airing the injustices being perpetrated within organizations. Only then could regulators really go after wrongdoing.
This is a bit ironic and topsy-turvy, considering what Greenspan did to Brooksely Born at the Commodities Futures Trading Commission in the 1990s. She wanted to study whether we should make Credit Default Swaps and other credit derivatives more transparent and open to public scrutinty. Greenspan, Larry Summers, Arthur Levitt, and several others shouted her down and destroyed her government career. The Commodities Futures Modernization Act of 2000 passed, with her input being largely ignored.
Those Credit Default Swaps would later become the heart of the Synthetic CDO, which enabled trillions of dollars of subprime mortgage loans to be created for house flippers and cash-out refinances in the middle of the largest speculative financial bubble in recent memory. It was like Tulipmania in 1600s Netherlands, but instead of Tulips we had mortgages. This led directly to the crash of 2008, the Great Recession, and the bailouts of the big banks by the taxpayer.
So although Greenspan might believe in the principle of whistleblowing as an effective means of preventing wrongdoing, his own wrongdoing provides one of the best examples of why whistleblowers should be protected.
Again and again, we see the consequences of persecuting whistleblowers. It goes far beyond a simple violation of human rights, or a petty political squabble between two differing camps inside an organization. In the absence of whistleblowers, corruption becomes endemic, it becomes rampant. The ecosystem of the well run organization is overturned and destroyed, and replaced with incompetence and reckless decision making that goes forward unbothered by honest discussion or dissent.
This is how you have a country that continues to churn out poisoned food, even with a massively, centralized police state that monitors the twitters of hundreds of millions of people, yet cannot monitor the products of it's own food factories, even after poisoning hundreds of thousands of it's own children.
It is not a problem of regulation, China is one of the most regulated societies on the planet. It is a lack of human rights, the right to free speech, the right to petition the government, the right to criticize corporations and officials, and the right to blow the whistle.
China’s poor treated to fake rice made from plastic: report By David Edwards Tuesday, February 8th, 2011, rawstory.com
Age of Turbulence, Alan Greenspan, 2008
A chinese dissident is freed, but he's still not free Simon Says by Scott Simon, npr.org, 2011 6 25
China’s poor treated to fake rice made from plastic: report By David Edwards, Tuesday, February 8th, 2011 , rawstory.com
China milk scandal: Families of sick children fight to find out true scale of the problem, Malcom Moore, 3:56PM GMT 03 Dec 2008, The Telegraph (UK)