Is the "iron rice bowl" no longer iron—has it rusted?

These voices are coming from Shanxi, where a reform is underway... focused on just one thing: streamlining the workforce and government.

Round after round of institutional reforms has, over time, seen the initial fervor fade into the ordinary, with no clear focal point.

However, Shanxi has taken the initiative to “clear the minefield,” moving beyond merely “striking without breaking through.” Ultimately, with fewer temples, there are fewer abbots.

Viewed this way, the strategy of “pulling the strings and striking at the vital point,” “stepping on the nerve and making them feel the pain,” speaks for itself in terms of its shock value and penetrating power.

Some call it “cutting officials,” but that is not the case. Wherever there is a need, officials must go there, breaking the “iron rice bowl” and willingly serving as “guides.”

The model for reform is not replication, but exploration.

Iron Rice Bowl

A Crack Has Been Opened

This reform in Shanxi was launched in 2020.

Among them, six small counties with populations under 200,000 were designated as pilot reform areas. Recently, Hequ County announced that its goal of a “large-department system” had been largely achieved, drawing nationwide attention.

36 Party and government agencies were streamlined to 22

The number of leadership positions was reduced from 135 to 114

186 public institutions subject to reform were consolidated into 40

1,964 public institution positions were reduced to 659

It is clear that the reforms have focused on streamlining Party and government institutions and reducing the number of leadership positions.

How did Shanxi carry out these reforms?

First, institutions with similar functions were reorganized.

The County Party Committee Office can easily share office space with the County Government Office. The Human Resources and Social Security Bureau was merged with the Civil Affairs Bureau to form the County Civil Affairs and Human Resources and Social Security Bureau.

Second, deputy county magistrates directly assume the roles of directors for certain bureaus.

This would result in a deputy county magistrate holding the titles of director for three bureaus. This not only reduces the number of approval levels but also significantly shortens processing times.

In particular, the responsibilities of units involved in investment promotion must break away from the habitual mindset of “waiting, relying on others, and asking for handouts.”

Before the reform, the Investment Promotion Service Center was only responsible for follow-up services during the project’s initial stages, such as matching, negotiation, signing, and implementation. After the reform, it must assume full responsibility throughout the entire process—from project attraction, signing, and implementation to groundbreaking, construction, and production.

Previously, the Project Promotion Center’s work concluded once a cooperation agreement was signed with a prospective enterprise. Now, it must ensure the project is successfully implemented. Attracting investment is the foundation, but ensuring the project is implemented and sustains long-term success is the key.

At the heart of this lies the human factor. To break free from the “iron rice bowl,” one must first break free from one’s status.

Promotion and Demotion

The key question is: who gets demoted?

The reform ultimately hinges on three key aspects:

First, how to structure the organization; second, how to appoint leadership; and third, how to assign personnel to their posts.

The first two aspects are actually not difficult to resolve; the real challenge lies in the third.

In terms of streamlining institutions alone, the efficiency has been high, and the objective has been achieved. However, once institutions that should be abolished are abolished and those that should be merged are merged, staffing becomes a major challenge.

In Hequ County, the reduction from 36 agencies to 22 implies at least 14 changes in top leadership positions; if Party and government roles are separate, the number could be even higher.

So, who stays and who goes?

As things stand, there has been no strict distinction made between promoting or retaining capable individuals and removing or retiring incompetent ones. There is no need to elaborate on the capable; however, there is still no clear pathway for incompetent individuals to be removed, nor has an atmosphere of accountability been established.

From this perspective, it is not a completely successful model. If staffing is not properly addressed, how can we even discuss assigning personnel to specific positions?

Therefore, reform in small counties is a systemic endeavor. County-level institutions must clarify their respective functional roles while effectively managing various administrative transitions.

The Best-Fitting Shoes

is not necessarily the most expensive

This year, the topic of “985” elite university graduates moving to county towns quickly gained traction.

Some argue, “Big cities need ‘985’ graduates more; don’t waste high-end talent”; others say, “Talent drives county-level economic development”—opinions remain divided.

I believe both of these arguments are rather macro-level. Every “job” is created at the distribution end of economic output; economic results never materialize out of thin air.

A faucet doesn’t produce water; it isn’t even a carrier of nature’s resources. A bottled water factory involves a series of production, packaging, and transportation processes.

Any distribution must first identify the “source.” The same applies to the “iron rice bowl.”

The issue is straightforward: the higher the investment in labor costs, the higher the expected return. Many small counties are simply unable to meet these expectations.

County-level finances are at the end of a long chain of fiscal transfers; they operate at a low level of the distribution hierarchy yet rely heavily on fiscal infusions.

Clearly, this is not a stable “water source.” If the flow of fresh water from the source diminishes, the reliability of county-level fiscal support becomes questionable. When the water in the fiscal “reservoir” runs low, the extent of financial security for county-level governments is self-evident.

Of course, the “rice bowl” remains, but one must “find” one’s own sustenance. Whether labor-related production factors can generate economic benefits depends on rational allocation; higher investment does not necessarily guarantee higher output.

Conclusion

In local reform, only by undertaking what others cannot or will not do can one glimpse a “ray of light.” This underscores that foresight and vision are essential qualities for local leaders.

What is “foresight”?

It is the ability to make judgments before local issues show even the slightest sign of trouble.

Strategy is like choosing a lane: if you pick the wrong one, even if you’re driving a BMW, you’ll have to watch helplessly as a Geely overtakes you.

Therefore, local reform requires a holistic perspective: rise above the fray, clearly assess the road ahead, and then return to the car to choose the right lane. The greatest crisis in local reform is not failure, but complacency.

If you’re always fixated on immediate problems, you’ll miss new opportunities and choose the wrong track.