The Shared Responsibility of Collective Decisions

Just as much of the risk of investment projects is absorbed by local industrial circles, so is the responsibility for investment decisions. Since government agencies have taken it upon themselves to intervene actively and compensate for "objective conditions," they take up much of the responsibility for investment decisions.

An enterprise's initial project proposal (xiangmu jianyi shu ) is submitted to its industrial bureau, but after that point various government agencies become involved. The industrial bureau commissions a feasibility study and may order revisions. Depending on its size, the project will then be taken to the planning commission, or to higher levels of government, for approval and to arrange a funding package. Finance bureaus and banks will examine the project proposal and arrange funding; when a tax break is required, the tax bureau must also be consulted. The loan repayment contract represents prolonged discussions by these agencies. Symbolically, it must be affixed with the seals of the enterprise itself, its industrial bureau, the finance bureau, bank, and tax bureau.^[43]

In effect, the investment is not the enterprise's decision: it is a collective one of all of the local agencies that have discussed and approved it. "The responsibility is unclear, however, who it is that gives final approval, or who it is that has the right of final denial. If any one of these organs turns you down, you can't get it. So the responsibility is unclear. No one is entirely responsible."^[44] In controversial cases, the decision follows from a long process of consensus building, which may in the end be settled by the planning commission or the mayor's office. The manager's plans have been scrutinized and approved by the entire local industrial circle. If something goes wrong that cannot be attributed directly to the manager's subsequent actions, all of the departments involved share responsibility for the initial decision to go ahead. This is one important reason, in addition to the more obvious economic ones, why local industrial circles are prone to save firms in financial difficulties. Not only can "objective conditions" be blamed, but they are themselves implicated, since they set the financial conditions under which firms operate.