How looters scrapped a new Chinese ironworks

China's official news media have been offering a glimpse into what appears to be a persistent difficulty in maintaining the country's law and discipline. In doing so they have also illustrated the part played by China's press in ferreting out and publicizing violations of the law.

The example recently publicized is an ironworks that used to produce nearly 60,000 tons of iron per year. According to an account in the official People's Daily, it has been turned into a ''ruined battlefield'' after an orgy of stripping and looting led by its own director.

The Communist Party's central discipline inspection committee calls the incident ''a typical, severe case of violation of law and discipline and of criminal acts.'' The wording indicates the incident is not seen as an ''isolated case.''

The case was first publicized by the People's Daily, official organ of the Communist Party, in March, but the central discipline inspection committee did not publish its report until Aug. 29.

The director, Meng Qiufeng, was tried and sentenced Sept. 4 to two years hard labor, suspended for two years. The relatively lenient sentence suggests he still has friends in the city of Handan, where the incident took place, some 270 miles south of Peking.

According to the central discipline inspection committee's report, the Hengshui district ironworks in Handan City, Hebei Province, was built in 1973 to turn iron ore into pig iron. In five years of operation (1974-79), its losses totaled 15,600,000 yuan (about $10 million).

Thus, when the central government announced a sweeping economic readjustment policy under which enterprises operating at a loss were encouraged to merge with others, to shift their products, or to close down, the Hengshui district party committee decided to close the ironworks.

According to the official version, factory director Meng, who was concurrently second secretary of the party committee, connived with Gao Jinmin, director of the supply and purchasing department, to sell off the ironworks equipment at ridiculously low prices.

For instance, the ironworks' 55 cubic meter blast furnace was sold for 7,500 yuan ($5,000). The purchaser then resold the blast furnace, making a profit of 2 ,600 yuan. A smaller blast furnace sold off for 425 yuan netted its purchaser a resale profit of 4,600 yuan. Twelve tons of steel were sold to a nearby commune for an undisclosed low price. The commune resold it to the state, making a profit of 5,300 yuan.

Director Meng and his subordinate Gao obviously made handsome profits from these transactions. The Worker's Daily describes Mr. Meng's background as a purchasing agent who had no knowledge of technology. But he was said to be a good talker who traveled widely and had a network of acquaintances in high places.

After the ironworks closure, he was said to have sent around a six-ton truck filled with coke to be delivered to the director of the district industry bureau , and other officials ''to close their mouths.''

The ironworks party secretary Li Renjiu took no action because he had taken his wife on sick leave to Canton and was absent for three months. When he returned, he was mostly concerned about smoothing the way for his next post as director of the education department of Hengshui district. The deputy factory director, Guo Zhiyi, took an ironworks jeep to Tsingtao to get a job for his son. On his return he took waterpipes, cane furniture, and wine cupboards from the ironworks to his own house.

Outsiders, noticing what was going on, were said to have come in their tens and hundreds to cart or backpack away pig iron, coke, coal, lumber. ''Like a hunk of fat pork,'' the Worker's Daily said. '

One ironworks officer, Li Haicheng, tried to expose the wrongdoing. But he only offended his superiors and lost a salary raise.

Ultimately, however, the People's Daily heard about the case and sent a reporter to investigate. His report, corroborating Li Haicheng, was published in an internal publication of the People's Daily in January 1981 and eventually in the newspaper itself March 3. (In China, much news considered too sensitive for public consumption is published in internal publications with varying degrees of secrecy.)

Mr. Li has recently been commended and promoted to be deputy director of the industry and commerce administrative control bureau of Hengshui district.

The Worker's Daily said in an editorial comment that people like Li Haicheng are all too often isolated. ''Those who work vigorously and hard are isolated, those who dare to uphold the way of righteousness are isolated.'' And the prestige of the Communist Party suffers yet another blow.

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