Good-Bye Director Lu?!

The unconfirmed rumor confirmed fact that CCAA Director Lu Yin will be leaving his post after eight years has resulted in much speculation as to the reasons and impact his "promotion" re-assignment will have on China's international adoption program. While I have nothing directly to add to the puzzle, there are a few pieces of information that might help clarify what this change means to Director Lu and the adoption program in general.

Given the ambiguity of the move, there is reason to suspect that this move is not a promotion. First, he is being moved from a directorship in a top-level department (CCAA) to a "post" in a "department". The lack of title may be meant to suggest that he is being moved down the bureaucratic ladder.

There are three main hypothesis as to why Director Lu has been moved from his position as director of the CCAA:

1) The Chinese central government is so proud of the job Director Lu has done that they feel his talents are now needed in another area of the Chinese Social bureaucracy. Thus, this move can be viewed as a promotion.

2) The central government realized that the increased international attention being brought on the Chinese adoption program is a result of pressure placed on orphanage directors by Director Lu. In recent years repeated "inquiries" of the China program by the Dutch and Canadian governments (among others) has left the central government feeling that it is only a matter of time before another scandal breaks out, and that Director Lu has done little or nothing to curb the abuses that are resulting in the negative international attention. Thus, by quietly moving Director Lu from the CCAA, the central government can respond to future controversies by claiming they were proactive in removing the offending director, thus "saving face".

3) Director Lu has overseen a 70% decline in China's adoption program over the past four years, from a peak of over 14,000 children in 2005 to under 5,000 adoptions in 2008. This fall in adoptions, with its accompanying decline in adoption revenues ($27 million), has prompted the central government to seek a new head of the CCAA.

All three of the above scenarios are possible, but some are more likely than others. Scenario 1 appears unlikely since there has been no official announcement on the CCAA website, the official announcement (made after we made this posting) lacks any indication that Director Lu was given a directorship position. It says only that he joins the staff of the "Department of Social Welfare and Charitable Corporation Advocacy at the Ministry of Civil Affairs". Additionally, as of this writing none of the orphanage directors we spoke with had even heard that a change was being made. This lack of "publicity" of a promotion discounts the probability that it is a promotion. Rather, it appears that Director Lu is being quietly "re-assigned" in a fashion very common in Chinese government -- reassign as quietly as possible to avoid questions and controversy.

Scenarios 2 and 3 are both likely, in my opinion, but recent events increase the possibility of scenario 2 being the reason. The Central Government must realize that there are serious issues in the adoption program, issues that are becoming increasingly visible as more and more investigations are conducted (even now there are several Chinese and international investigations taking place). It is unlikely that given the realization that at any moment "another shoe can drop" that they would put themselves in a position of being complicit in the problems. Thus, scenario 2 can be viewed as a "house-cleaning", replacing Director Lu with a new director who will shortly announce "changes in orphanage procedures" to clean up the problems. In this way, if new reports surface of corruption and wrong-doing, the central government can assert that such problems have been rectified, and responsible parties removed from their positions (the standard response to such discoveries).

Scenario 3 is possible if the Chinese are politically tone-deaf and seek simply to expand their adoption program to increase funding into the Social Welfare program. In this scenario, Director Lu's attempts to increase adoptions by increasing the orphanage donation to $5,000 in January 2009 is seen as ineffective, given the apparent lack of response from orphanage directors in general. Thus, a new director that can play "hard-ball" is needed to increase the pressure on directors even more, either through "growth quotas" or some other idea. This scenario pre-supposes that the central government is not happy with the decline in adoptions over the past four years, and Director Lu's apparent inability to rectify it.

In summary: Given the short and terse announcement of Director Lu's re-assignment, and the complete lack of awareness inside China of Director Lu's "re-assignment" (it is not at all clear whether his new job is a promotion, and in fact does not seem to be) seriously undermines the contention that this change is a result of exemplary job performance on the part of Director Lu. Thus, it is likely that Director Lu is being moved to make way for a new director (Zhang Shifeng, previously the assistant director of the Ministry of Civil Affairs), who will bring significant chances to the CCAA's handling of international adoptions. Will the new director reign in the orphanages by instigating "procedural changes" to eliminate "reward" programs, or will he increase pressure on orphanages to produce more children for international adoption? Given the press coverage of corruption the CCAA has had to deal with in recent years, one would assume this change is to improve the ethical underpinnings of China's IA program, but this assumption is only partially offset by the desire of the Chinese to improve their social welfare system on the backs of a healthy and vibrant IA program.