China’s “princelings” — the offspring of senior Chinese officials who benefit from lavish privileges in education, employment and business — are coming under scrutiny as never before. Former secretary of the Chinese Communist Party’s (CCP) Chongqing branch Bo Xilai (薄熙來), the son of one of former Chinese leader Mao Zedong’s (毛澤東) comrades and a supposed “immortal” of the revolution, was recently sentenced to life in prison after his conviction on charges of corruption and abuse of power.
Outside China, princelings are feeling the heat as well. Not long ago, the US Securities and Exchange Commission announced that it was investigating JPMorgan Chase’s hiring of princelings in Hong Kong, who apparently delivered lucrative underwriting deals for the bank.
While recent scandals have put China’s princelings under a harsh media spotlight, they have been hot commodities for Western companies seeking to capitalize on their guangxi — connections — in order to secure multibillion dollar transactions. The list of financial institutions that have engaged in such hiring practices reads like a who’s who of investment banking.
It is premature to conclude that JPMorgan violated the US Foreign Corrupt Practices Act by employing children of Chinese officials who oversaw companies that retained the bank to underwrite their stock offerings. Nonetheless, the case highlights a broader trend: The wooing of China’s princelings by prestigious Western educational institutions and businesses for the purpose of advancing their parochial interests in the burgeoning Chinese market.
The unseemly race to recruit princelings starts at the world’s leading colleges and universities. Because China has no universities that rival the Ivy League or Oxford and Cambridge, senior Chinese officials prefer to send their children to these schools.
Given the opacity surrounding admission to these highly selective institutions, it is impossible to tell whether princelings get in on merit or because of their family background. It is notable that princelings are not found in the most prestigious doctoral programs, where professors, not administrators, make admission decisions. Likewise, the Massachusetts Institute of Technology and the California Institute of Technology, have a dearth of princelings.
Indeed, the sheer number of princelings, including children of incumbent Chinese leaders, now attending Ivy League universities clearly points to the importance of family ties. Chinese President Xi Jinping’s (習近平) daughter, for example, studies at Harvard under an assumed name, and Bo’s son has been a student at Oxford and Harvard’s Kennedy School of Government; he is studying at Columbia Law School.
Elite Western colleges and universities, having identified China as a top market for fund-raising and high-end network building, regard the princelings as a valuable investment. Nurturing ties with China’s political elite is good business, and they can help open doors.
However, preferential treatment for princelings at elite universities (and business schools) has real social costs. A place awarded to a less-qualified student is a place denied to a qualified applicant.
Worse still, this injustice is self-perpetuating. Western investment banks and multinationals can use elite academic credentials to justify a job offer, even if the real reason is the hope that putting a princeling on the payroll will give the company a rainmaker in China.