Principal-insiders Agent: An Exploration Of The Relationship Between The State And Civil Society

Through a typical case study of China Society of Red Cross, which hasbeen developing more than one hundred years in China, submitted to theChart of International Federation, the research draws a conclusion that,the designed frame ‘Principal-insiders Agent’, involving theprincipal-agent model and the State-insider instrument, is able toanalysis the relationship between the society and the state since thereform and opening up.This Principal-insiders Agent model includes an implicit contractbetween the state and the Red Cross. On the one hand, the state entruststhe Red Cross with duties of Geneva conventions and additional protocolsigned by the International Committee of the Red Cross; On the other hand,the State successes in keeping the operation control of the Red Crossby directly dispatching Principal-insiders to the Red Cross as the leader,managing its staff with reference to civil servants management, treatingits organization as a public institution（Shiyedanwei），and making anannual financial budget for its daily implementation, etc.Principal-insiders Agent model essentially helps the State maintainingthe control of the Red Cross Society of China as a branch of theInternational Federation. The model can be generalized for explainingthe Dual Control System for universal social organization administrationby demonstrating that the business supervisors from the state play ananother kind of implicit role of Principal-insiders, which executes anindirect Principal-insiders Agent on social organizations.Although insufficient in social efficiency, the social risk is reasonably controlled under the Principal-insiders Agent with a ratherbetter supervise on the process of social disembedding from the stateand social organizations development. Principal-insiders Agent as agovernance mechanism practically presents a vivid experience about thestate-civil society relationship in the condition of the reform andopening, while theoretically conducting a dialogue with the mediatingstructure suggested as “squire society” and “unit society”. As well,the Principal-insiders Agent model ideologically acted as an externalcounterspell dealing with organizations governance puzzle of “insiderscontrol”.But here has been coming the irrevocable social differentiation andcommunity self-government. The civil society should be empowered,especially supported by social property system while encountering lackof the principal ability depended on property right.A legal society rather than an one proxied by the state would make a moreeffective state. Only shaped by the constitution and law regulation, therelationship construction of the state-civil society could overcome“insiders trust endless loop”, and achieve good governance on the basisof effective state and societal self-government.