Commentary on Political Economy

Sunday 17 October 2021

An insider’s view of China’s Communist Party: Corruption and capitalist excess

 In recent months, the leader of the Chinese Communist Party, Xi Jinping, has been promoting a new ideological-political framework called “common prosperity.” On the surface, the campaign is directed at blunting, even reversing, China’s pronounced income inequality. As Xi told Chinese officials early this year, “We cannot let an unbridgeable gulf appear between the rich and the poor.”

Some observers see this as a striking move to the left by Xi as he pursues a controversial third term as Communist Party leader next year. Sensing the mounting frustration of Chinese citizens as they navigate the social tensions sparked by new technologies and the proliferat- ing number of billionaires who created them, Xi might be tacking back to the party’s socialist roots to shore up its legitimacy, not to mention his own political future.

This view is hard to sustain after reading Desmond Shum’s remarkable new memoir, “Red Roulette: An Insider’s Story of Wealth, Power, Corruption, and Vengeance in Today’s China.” The Chinese Communist Party depicted in Shum’s firsthand account is the epitome of capitalist excess, with the sons and daughters of high-ranking party officials going on global shopping and gambling sprees, spending the vast sums their parents and relatives amassed through rampant corruption, influence-ped- dling, ruthless political maneuvering and back- stabbing. With shelves groaning under the weight of books on modern China, Shum’s is a standout as a rare bona fide insider account of

SEE CHIN the decidedly anti-socialist nexus of money and politics that defines China’s authoritarian political system. It is essential reading for anyone interested in piercing the carefully controlled and orchestrated propaganda ve- neer Beijing has erected.

Shum was born in Shanghai in 1968 at the height of the Cultural Revolution, Mao Ze- dong’s campaign to remake China through a revolutionary baptism. As the Maoist chaos swirled around him, Shum’s life inside his household was typified by “degradation and punishment” at the hands of his parents. His mother belittled him; his father beat him. His lucky break came in 1978, when he moved to Hong Kong, the then-British-controlled is- land territory just off China’s southern coast. As capitalist as the mainland was communist, Hong Kong was, in Shum’s description, “an- other world.” After completing his undergrad- uate education in the United States, Shum returned to an investment gig in Hong Kong and began his ascent to the heights of political and financial power in China.

At the heart of Shum’s book is the story of how he and his wife, Duan Weihong, amassed a fortune by exploiting their relationship with Zhang Beili, the spouse of then-Premier Wen Jiabao. After first meeting at a social engage- ment, Duan built trust and friendship with “Auntie Zhang” (as she was affectionately known to the couple), which soon translated into access to a growing number of insider- connected business deals. As their relation- ship with Zhang grew, it also afforded inti- mate contact with other political elites, in- cluding Xi. At the height of their business dealings, Shum and Duan (who went by the English name Whitney) had business and social connections with nearly all the top political players, including Sun Zhengcai, a rising party official thought to be a possible successor to Xi, and Ling Jihua, the head of the Communist Party’s General Office, which functions as the nerve center for party administration.

Anyone familiar with these last two names will be able to guess how Shum’s story ends. The couple rode the wave of the corrupt, cowboy capitalism that exemplified much of China’s economic-reform era, but then the wave crested and crashed as Xi came to power in late 2012. Within a year of his accession, he rolled out an aggressive anti-corruption cam- paign that eventually felled some of the party’s senior-most cadres, including Sun and Ling. Sadly, Duan was collateral damage. In 2017, she was detained by the Chinese authorities, and to this day, she remains in custody without charge, a Kafkaesque fate that befalls

RED ROULETTE An Insider’s Story of Wealth, Power, Corruption, and Vengeance in Today’s China By Desmond Shum

Scribner. 310 pp. $30

Though Chinese President Xi Jinping has led aggressive anti- corruption campaigns, top leaders in the Chinese Communist Party are still obsessed with money and power, writes Desmond Shum.

many whom the party believes have commit- ted political crimes.

Shum’s book is a remarkable indictment of the Chinese Communist Party, coming at the precise moment that Xi is attempting to rebrand it as a morally pure force working selflessly on behalf of the Chinese people. “Red Roulette” lays siege to this effort by depicting a ruling class obsessed with power, luxury and status. This perhaps explains why the party went to such great lengths to guard two recent phone calls from Duan to Shum in which she pleaded with him to halt the book’s publication, lest harm come to her and his family.

The details in Shum’s memoir also high- light the limitations of more formalistic analy- sis of China’s political system. While the

hierarchical, Leninist nature of party govern- ance and decision-making remains an impor- tant conduit for the exercise of authority, it is in the informal interactions among the politi- cal, business and military elite that true power is exercised. In this, Shum’s depiction of how power is wielded brings to mind Milovan Djilas’s 1957 critique of Soviet communism, in which he observed: “Meetings of party fo- rums, conferences of the government and assemblies, serve no purpose but to make declarations and put in an appearance. They are only convened to confirm what has previ- ously been cooked up in intimate kitchens.”

As Xi continues to nudge China’s political system in the direction of dictatorship, the official rhetoric of equality and socialism will become more pronounced as he attempts to


reforge the party’s popular legitimacy. Yet, as Djilas observed about the Soviet Union, so long as the Communist Party controls all power and property, “it inevitably creates privileges and parasitic functions.” Xi hopes that his very public denouncements of corrup- tion signal a new model of clean authoritarian governance, but as Shum warns in the book’s final passage: “The reality is that the Party’s main purpose is to serve the interests of the sons and daughters of its revolutionaries. They are the primary beneficiaries; they are the ones sitting at the nexus of economic and political power.”

Jude Blanchette holds the Freeman chair in China studies at the Center for Strategic and International Studies.

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