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China Change, October 8, 2018
This weekly bulletin is NOT a news summary of the week, but a reading of ‘signs’: signs of quickening changes and shifting ground. Not every new development is suited to a fully fleshed-out analysis, and as with so much in China, many reports cannot be immediately confirmed or properly evaluated. Nevertheless, while each individual brush stroke may not be decisive, we hope that upon stepping back a fuller picture would emerge. Sign of China catalogues and contextualizes these items so as to grow an awareness and keep a record of sort. As incomplete as it is destined to be, we hope the series is edifying and useful. — The Editors
Pence’s Speech and Two Emblematic Chinese Responses
On October 4th, during the ‘golden week’ of the National Day of the People’s Republic of China, the U. S. Vice President Mike Pence delivered a speech that laid out in full the Trump administration’s views of China and the Chinese communist regime. You should watch it in full, but the editor of China Change has offered a crude summary of the speech: “Pence’s speech in a few words: the United States has done nothing to hurt China for more than 100 years. If it weren’t for America’s help, where would China be today? Not only do China’s leaders seem ignorant of what’s good for them, but they repay these favors with low and despicable acts in order to walk all over us and squeeze us dry. This is just asking for a good beating.”
One academic tweeted: “This one is going down in the history books. Not because of any soaring feats of oration or anything like that. But this marks a fundamental shift. Four decades of American policy has been overturned. Today is the end of an era.”
“The Sino-U.S. trade war has gotten to the point where America’s president and vice president have both stepped out to speak. All the while, the Chinese side has left the matter to just three spokesmen from the departments of defense, trade, and foreign affairs.”
“In the past, whenever the U.S. and China had some conflict, Chairman Mao himself would confront the other side. Today the American vice president Pence has come knocking at our door; can’t we find a leader of our own, someone a bit higher in rank than a spokesman [to come out and say something]?”
“Comrade Zhang” had observed the conspicuous absence of his country’s leaders in the diplomatic arena and felt something amiss. It’s a feeling the censors didn’t want him to have.
A Chinese human rights lawyer, disbarred by the authorities earlier this year, said after Pence’s speech, “Our prevailing attitude is silence. Going back a few years, you may have been able to find throngs of people filled with indignation at America’s actions. Such is the change.”
The Curious Case of Meng Hongwei
Sometimes in late September, Meng Hongwei (孟宏伟), president of Interpol and the Deputy Minister of Public Security, boarded a plane in Stockholm and returned China. Three days ago his wife reported him missing to French authorities. She had been receiving threats via phone and other venues. On Sunday, within an hour after Grace Wang gave a press conference in Lyon, the Chinese authorities announced that Meng was “under investigation by the National Supervision Commission for alleged violation of the law.”
Meng’s Interpol presidency was a cherished prize for China, representing China’s attempt to use the international organization for its own political purpose.
Meng’s term as Interpol chief expires in November 2020. The fact that the Chinese leaders were compelled to take down Meng at the steep price of ruining their credibility indicates the emergent nature of the matter involving Meng. It’s clear that Meng knew his trip back to China was an ominous one, and made arrangements with his wife that deviated the Party’s protocols: to publicize his disappearance and appeal to international help, instead of staying silent and “trusting the Party” (相信党). What Meng did is no less than to betray the Party. Maybe it is a matter of problematic loyalty. A Deputy Minister of Public Security knows too much and is involved in too many high-stake issues. His allegiance became questionable, and therefore he had to be pulled back at all costs. This is the only reasonable explanation we at China Change can come up with.
We will refrain from wallowing in the rich irony and absurdity of the event, but there are a few points to register:
- People who hold positions in international organizations, regardless of their position or nationality, should perform their duties as independent individuals, rather than as representatives of their respective countries. But the Chinese Communist Party (CCP) affords none of its members such independence, Meng Hongwei among them. As far as the CCP is concerned, he is the Party’s man above all, and the Party can sanction him at any time as it sees fit, even during his Interpol term.
- It follows that Meng Hongwei, in his capacity as Interpol chief, was inevitably subject to the Party’s directives and control.
- Meng Hongwei’s mafia-style abduction sends a stark message to the international community: totalitarian China does not conform to international procedures and is incapable of participating in world affairs as a normal country.
- Almost exactly a year ago, Xi Jinping attended the 86th Interpol general assembly in Beijing and delivers a keynote speech emphasizing “cooperation, innovation, the rule of law and win-win results and build a universal and secure community of shared future for mankind.”
The next time Xi Jinping, or any Chinese leader, speaks at any international event, whether at the UN, the Davos Forum, or at international and regional summits, about globalization, climate change, free trade, world peace, think of what the Meng Hongwei episode says about China and just laugh .
In another report, RFI quoted the Japanese-language edition of Business Journal, which on Oct. 1 said it had found via CCP diplomatic channels that the Party elite had given up on resolving the Sino-U.S. trade frictions in the short term. From internal documents it was revealed that the children of senior Communist Party officials have been ordered not to study in the United States, and those already in the U.S. will be called back to China.
One analysis offered by the Business Journal of the order is that the Chinese government is worried that the high-ranking children could be held hostage by Washington. Another speculation is that the CCP has recalled its cadres’ children to shore up their loyalty — officials whose offspring and assets are in the territory of the United States may not have the Party-state’s best interests in mind. The CCP may wish to avoid the Three Kingdoms-era conundrum of “being present in the Cao camp while serving the Han at heart.” (身在曹营心在汉)
Former President of Xinjiang University Sentenced to Death
According to Radio Free Asia Uighur service, former president of Xinjiang University, Professor Tashpolat Tiyip has been sentenced to death with two year reprieve for ‘separatism.’ The two sources cited by the RFA report, one was the political director of the Federation of Literary and Art Circles in Xinjiang and the other from a police station in Kashgar Prefecture, learned the sentence of Professor Tashpolat Tiyip from a 90-minute internal, ‘cautionary’ film.
According to Baidu encyclopedia, Professor Tashpolat Tiyip was born in 1958, a scientist in geoscience and remote sensing, and enjoyed a special allowance for experts by the State Council. He was dismissed in March 31, 2017, and that probably was also the time when he was arrested.
Another report has it that Kurban Mamut, the 68-year-old retired editor-in-chief of Xinjiang Culture magazine, was taken to a “re-education camp” in February 2018.
In a 4-minute video, Torchlight Uyghur Group compiled an incomplete list of Uighur public figures who have been given staggering sentences or sent to camps, including scholars, scientists, intellectuals, writers, artists, educators, and businessmen.
News from Xinjiang continue to roll in daily: grim, bleak, and desperate. Journalists noted (here and here) that, on government websites, officials’ resumes have been altered to remove their positions at “vocational schools.” By inference, the city of Atush alone, with a population of 200,000, has at least seven such “schools.”
Two weeks ago, we wrote in the second issue of Signs of China that the Uighurs detained in concentration camps were being transferred to other parts of China. There were only bits and pieces of information available at that point, but now the news has been confirmed via various sources.
The situation is developing on a large scale and with shocking speed. Radio Free Asia reported that since the beginning of September, the Xinjiang authorities started deporting Muslims held in so-called “deradicalization education centers” and “vocational schools” to other regions. According to a number of Muslims in Xinjiang who spoke on condition of anonymity, the transfer has targeted Uighurs in Kashgar, Hotan and other places in southern Xinjiang, as well as Kazakh communities in the Ili Kazakh Autonomous Prefecture in the northern part of the province. The number of people being moved could be as high as 200,000 or 300,000.
Police Given Authorization for Unlimited Access to Internet Privacy
China’s Ministry of Public Security recently released its “Public Security provisions on public Security organs internet security, supervision, and inspection,” effective Nov. 11.
According to the Provisions, the public security organs are cleared to inspect companies that provide internet access, internet data centers, content distribution, domain name services, online information, and the like.
Reasons for inspection include looking into whether or not the company has taken measures to follow laws pertaining to the recording and retention of user registration and login information; whether it is taking relevant preventative measures to control the publishing and transmission of information prohibited by law or administration regulations; or whether they have recorded the user data in hosting or virtual space leasing.
In other words, Chinese police are now authorized by government regulation to walk into any internet firm and copy everything on their servers at will. They have had such unfettered access to domestic internet companies already; now it’s every company without exception. Even foreign companies like Apple and Amazon have handed over server access to their Chinese partners after China’s Internet Security Law was promulgated June 1, 2017.
Growing Industrial Pepper: For Hot Pot or for Pepper Spray
Starting in the spring of 2018, in dozens of towns and villages across Guizhou Province, farmer started receiving instructions and training from commercial technicians teaching them how to plant a new kind of industrial pepper, RS-3. It is currently the hottest pepper that can be produced as a crop, and it is reportedly best cultivated in Yunnan and Guizhou, where there is dry soil and ample sunlight.
The county of Zhenning (镇宁) has planted about 10,000 mu (about 1,500 acres) of RS-3 with assistance from the Guizhou Red Star Development Company (贵州红星开发公司). A total of 100,000 mu are planned. The county’s Party secretary personally inspected a number of planting “bases” to ensure that the crop had reached or exceeded the issued quota.
In the city of Panzhou, the Guizhou Huikangyuan Agricultural Technology Co., Ltd. (贵州汇康源农业科技有限公司) reached an agreement with farmers in several townships to cultivate 21,000 mu of the industrial pepper. It is also being grown in Puding.
One mu of land can produce 3,000 to 4,000 kg of RS-3 pepper. The developers are covering initial investment costs for the farmers, and will also purchase the crop at a fixed price. Agriculture materials such as seedlings, fertilizer, fluorescent films, and pesticides are being provided by county governments.
The neighboring province of Yunnan is also growing a variety of industrial pepper — 150,000 mu and still expanding, per one report. The province first began growing them in spring 2017.
These peppers are too hot to be consumed by people or animals. Farmers picking the crop must wear protection to avoid touching the pepper directly and causing damage to their hands. If the fruit is broken and the juice comes into contact with skin, it will cause burning that lasts four to six hours.
Speaking with the Chinese state media, one technician claimed that industrial peppers are widely used in the food industry. But netizens were quick to point out one particular usage: “More importantly, industrial peppers are of great use in military and defense application, such as counter-terrorism and riot prevention.”
According to one report, China “gets almost all of its red pepper, chili oleoresin, and capsaicin from India. India is the world’s largest pepper producer, and is at the forefront in industrial pepper extraction technology.”
Chinese Staple Crop Production Takes a Sharp Dip
According to the Weibo account of the China National Grain and Material Reserve Bureau, as of Sept. 25, total purchases of grain in major producing areas — Hebei, Jiangsu, Anhui, Shandong, Henan, and Hubei — amounted to 48.139 million tons, a year-on-year decrease of 22.406 million tons.
Major rice producers of Zhejiang, Anhui, Fujian, Jiangxi, Hubei, Hunan, and Guangdong reported total acquisitions of 7.689 million tons of long-grained rice, a 1.155-million ton decrease compared with the same period last year. Total production of rapeseed was 1.104 million tons, a 137,000-ton decrease. (Thanks to Tian Beiming [田北铭] for providing this information on Twitter.)
In July, the General Office of the State Council issued a notice to deploy a nationwide inspection of the quantity and quality of policy food stocks. The scope of the inventory includes central reserve grain, minimum purchase price grain, national temporary storage grain, national one-time reserve grain, local grain reserve, and the quantity and quality of commodity grain stored in policy food enterprises. The purpose is to verify “the true reliability of these stocks.” March 2019 will be the statistical reporting date of the food inventory inspection.
Disgruntled PLA Veterans Clash With Military Police in Shandong
During the National Day celebrations, hundreds of veterans waving flags of the PRC and the Party gathered in Pingdu, Shandong Province, to protest the police brutality and the blockage of their attempts at appeal. They prepared wooden sticks in advance for each man to defend himself with.
On Oct. 5, the veterans occupied the Pingdu Agricultural Technology Market and spent the night there. On the 6th, their representatives met with government officials. Negotiations apparently failed, since in the afternoon, the police violently clashed with the protesters. The police used tear gas and pepper spray to disperse the crowd, while the veterans fought back with fire extinguishers and their sticks. Over a thousand more special policemen were deployed, and the veterans were effectively routed that evening. Only about a dozen of them remained in the square. Surrounded by large numbers of police, they too were forced to leave as darkness set in.
On Oct. 7, veterans from other regions arrived in Pingdu. News reports indicate that Shandong Province has mobilized police and even contracted security personnel from all over the country to confront them. Newly shipped riot gear, such as batons and helmets, have been unpacked and put into use on the streets. The situation is still in progress.
On Oct. 11, 2016, nearly 10,000 veterans surrounded the Central Military Commission building in Beijing, demanding the government give them fair benefits and treatment, shocking the Party elite. This incident led directly to the establishment of the Ministry of Veterans Affairs on April 16, 2018. The Chinese government’s response seems to be a combination of placating them with money and arranging for a number of them to receive public employment.
Many observers believe that these PLA veterans are defenders of the system. Provided their immediate wishes are satisfied, they wouldn’t hesitate to become the regime’s thugs.
Live video footage of the protests are currently available on WeChat and other video sharing platforms. While having confirmed the authenticity of the events from other sources, we appreciate the comprehensive reportage provided by Twitter user @lifang072.
A Reality Check on October 5
Lest we forget the nature of political life in China, this WeChat post directs our attention to two events, both of which occurred decades ago on the 5th of October.
The first were the famous “five regulations” issued in a document by the CCP Central Committee and the State Council on October 5, 1993. These regulations stipulated that Party and government leaders at or above the county (division) level were not allowed to operate business enterprises or use their powers to benefit spouses, children, or other relatives and friends; in addition, officials were not allowed to work part-time and receive any remuneration in economic entities, buy or sell stocks, receive monetary gifts or securities at official events; or use public funding for entertainment.
Today, 25 years later, there are no officials in China who are not corrupt, and the country has all but set the curve for corruption worldwide.
Second, the People’s Republic of China signed the International Covenant on Civil and Political Rights at the United Nations on October 5, 1998. Today, 20 years later, a Nobel Peace Prize laureate has died after a long period of languishing in prison; political dissidents have been jailed and sentenced to severe punishment; human rights lawyers are disappeared and tortured; civil society organizations’ public welfare activities have been brought under strict control. Millions of Uighurs and other Muslims have been locked up in concentration camps; house churches have been suppressed or forced to disperse. The words and actions of virtually every citizen are subject to the eyes and ears of an omnipresent panopticon.
As with the case of Meng Hongwei, we are seeing increasing use of enforced disappearance, torture, and unnatural death as means of solving internal power entanglement.
There are those who are, ostensibly, trying to determine whether the problem lies with Xi Jinping or the system itself. We think they’ve had more than enough time to reach a conclusion.
Signs of China (1), September 16, 2018.
Signs of China (2), September 22, 2018.
Signs of China (3), September 30, 2018.
China Change, September 30, 2018
Unsettling news from China emerges every week — on social media, in reports, and from our own sources in the country. Not every new development is suited to a fully fleshed-out analysis, and as with so much in China, many reports and developments cannot be immediately confirmed or properly evaluated. Nevertheless, while each individual brush stroke may not be decisive, upon stepping back a fuller picture begins to emerge. China Change catalogues and contextualizes these items so as to keep a growing awareness of changes in China. — The Editors
‘Public-private partnerships’ 2.0: la chasse à courre
Chinese officials have come out with a string of comments recently that have spooked private companies. The first was a “senior financial figure” Wu Xiaoping (吴小平), who advised that “the private sector in China has already completed its task of assisting state sector economic development, and it should now gradually diminish in importance.” This was shortly followed by vice-minister of the Ministry of Human Resources and Social Security, Qiu Xiaoping (邱小平), saying that private enterprises must implement the “democratization of management, with the participation of workers led by the Party organizations of private enterprises,” and that “workers and enterprises must work together to create mechanisms for co-creation of benefits, sharing of benefits, and sharing of risks.” This process appears to be already underway.
On September 26, The Economic Daily (《经济日报》) defended the practice of SOEs buying stakes in troubled private companies and becoming the controlling owners. The paper argued that private companies encountering difficulties should turn to SOEs to be rescued — and indeed there have been many private companies that have already “sold” control rights to SOEs or state capital to survive. “The introduction of new SOE shareholders in listed private enterprises and the reform of mixed ownership are very much in the same direction. Both are in order to stimulate enterprise vitality, improve production efficiency, and achieve mutual benefit and win-win results.” Yet the author neglected to delve into the institutional reasons as to why private enterprises in China are facing such peril. “According to the chief economist of China Merchant Bank, all 11,000 businesses that went bankrupt between 2016 and the first half of 2018 were private,” Huang Yasheng wrote in an op-ed in The New York Times.
In a September 27 article titled “Vigilance against new public-private partnerships under the banner of ‘sharing’”, Hu Deping (胡德平), the son of the former Party secretary Hu Yaobang (胡耀邦), voiced unease and opposition to the above prescriptions and maladies. He cited a certain ‘Document 15’ from 1991 meant to encourage the development of private enterprise. Hu concluded that, “At a time when the private sector is in such difficulty, I feel that what’s happening in some places differs starkly from what people thought they understood clearly yesterday. Problems that have been understood clearly and resolved previously are now being brought back in a new form. There’s still a wish to crush private enterprise and force them into public-private partnerships. If this becomes a trend, and none dare to criticize it, then the consequences will be frightening.”
Just a few days ago, an essay titled “Wandering in the land of one’s ancestors” began spreading on the Chinese internet, despite being repeatedly censored and deleted. Who is said to be wandering on the land of their ancestors? China’s private enterprises — because the country doesn’t belong to them. A 60 year-old businessman lamented, as the author explained it: “After so many years of doing business and experiencing so many trials and tribulations, this is the first time that death has felt so close to his business: he suddenly felt like a wanted fugitive and pursued by tax, environmental, industrial, and urban management authorities, even neighborhood committees. In order merely to survive, his enterprise debt has been levered up to a degree that would wake him in his dreams. His company is walking on a tightrope. If short sellers attack him in the market, or a bank tries to pull one of the loans, the company could collapse overnight.”
The author writes: “Chinese SOEs occupy over 70% of the resources, but generate less than 30% of GDP, whereas in the four decades of reform the private economy contributed at least 50% of China’s GDP, 60% of the tax base, 70% of the technological innovation, and more than 80% of urban employment. Even in 2017, the peak year of the targeted tightening of supply-side reforms, private industrial enterprises outperformed state-owned industrial enterprises, getting an overall return on net assets of 19.6%, versus less than 10% return on net assets by SOEs. If private enterprises can be liquidated and banished at any moment, is there any other outcome than a net loss for society?”
The author continued: “It is no accident that China’s economy has been on a downward spiral since 1956 when joint public-private operations came into effect. By 1978 China’s GDP’s accounted for only 1.8% of global GDP, and the national economy was on the verge of collapse.”
The article features numerous graphs and data points.
The reason private companies can be ‘beaten’ at a moment’s notice, the author writes, is because of their ‘identity,’ or the nature of their ownership. The fact that the enterprises are private means that they’ll always be outsiders and exiles in China. The author asks: “Why can’t we put aside the debate about the ‘identity’ of who owns the means of production? Why can’t all enterprises simply follow the law across the country, work hard, serve this country, and be equally treated, honored and praised? Why is that so hard?”
It’s very hard. Because it’s the equivalent to demanding that China changes its political nature, establish a functioning rule of law, protect private property rights, and enshrine liberty and equality before the law. For the Communist Party, this is a hard ask indeed.
123 Hong Kong-listed SOEs amend their charters to give the Communist Party sweeping control over companies
Hong Kong’s Apple Daily reported that, from March 2017 to today — a period of about 18 months — 123 Hong Kong-listed SOEs have amended their articles of association to expand the power of their Party committees without limit, including eight blue-chip companies: Commercial Bank of China (939), Industrial and Commercial Bank of China (1398), Bank of Communications (3328), Bank of China (3988), CITIC (267), Sinopec (386), PetroChina (857), and China National Petroleum Corporation (1088). The state-owned companies involved included Conch Cement (914), China Jiaotong Construction (1800), and China Huarong (2279), among others.
The revised constitution stipulates that the companies must set up Party Committees: “The Party Committee will play a core leadership role, taking charge of the direction, managing the overall situation, safeguarding implementation, ensuring supervision of the implementation of Party and state policies in the company, and implement the major strategic decisions of the Party Central Committee and the State Council.”
The revised constitution also gives the Party Committee the power to override the board. “When the board makes major decisions, it must first listen to the opinions of the Party Committee.” Also, executive appointments and dismissals also fall into the hands of the Party.
Aren’t they just writing into articles of association what they already practice?
Xi embarked on a tour of northeast China this week. He visited the Heilongjiang Agricultural Reclamation and Construction Jiansanjiang Administration (黑龙江农垦建三江管理局), an important grain production base; in Qiqihar, he visited China First Heavy Group (中国一重集团), the old industrial base of China’s planned economy; he went to Chagan Lake in Jilin and the oil fields in Liaoning; he also went to Lei Feng Memorial Hall.
One may as well say that Xi was on a trip strengthening the symbolism of the Maoist era.
He also visited the Zhongwang Group (忠旺集团), a private enterprise in Liaoning, and said that the Party has always encouraged private economic development, and has promoted policies supportive of the private sector. Huh? Does China’s Chairman-of-Everything not know that private companies in China are falling off the cliff?
Of the 30 minutes of CCTV’s Evening News (新闻联播) on September 30, 25 minutes were dedicated to Xi Jinping’s inspection tour of the three northeastern provinces. One of the recurring watchwords was ‘self-reliance.’ Chinese must be self-reliant on grain, self-reliant in industry, etc.
Observers noted that whenever the Party was faced with serious political and economic challenges on the one hand, and become isolated internationally, it called for ‘self-reliance.’ The phrase first appeared in 1941, when the Party mobilized its people to grow opium in Nanniwan, near Yan’an, in the Party’s Shaanxi-Gansu-Ningxia base. The second time it was used was in 1960 during the great famine, and the third time in 1975 during the Cultural Revolution. This is the fourth occasion. Those who study China can reflect for themselves on the meaning of those four occasions.
Throughout his trip in the three provinces, Xi Jinping talked about ‘rejuvenating the Northeast.’ In the course of his visit, he even held a seminar on the very topic. The fact is that the economies of the three provinces — Liaoning, Jilin, and Heilongjiang — have been deteriorating for a long time now (read more), exhibiting the weakest economic growth numbers in China, and likely exhibiting decline over the last few years.
Less discussed is the bureaucracy, corruption, and mafiazation of the northeastern political sphere. In 2016 Sina Finance published an article titled ‘How bureaucratism has destroyed the northeastern economy,’ which was quickly deleted. The article however is still visible on some discussion forums.
None of these hard facts has made into Xi Jinping’s photo ops and the state media verbiage.
On the other hand, China’s grain crisis has been a major topic of public discussion recently, and research indicates that China is headed for serious food supply problems in the years ahead. On September 21, Xi led the Politburo in its ‘eighth collective study session’ to discuss the implementation of his rural revitalization strategy.
On September 26, the State Council issued the ‘Strategic Plan for Rural Revitalization’ (2018-2022), the first basic principle of which is to “adhere to the Party’s control over rural work,” and “ensure that the Party always assumes full control of the overall situation in rural work, coordinates all parties, and provides a strong political guarantee for rural revitalization.”
No reporting bad economic news
Chinese regulators in recent days have demanded that online finance websites like Sina Finance and Phoenix Finance be suspended and rectified. ‘Big V’ financial commentators on Weibo have also been commanded one-by-one to stop posting. Media reporters revealed that almost every web portal received notice from the Central Propaganda Department to cease reporting in six categories of news: 1) Disclosure of declining economic data, 2) Local government debt risks, 3) The adverse effects of Sino-US economic and trade frictions, 4) Data showing a decline in consumer spending, 5) Inflation and economic stagnation, and 6) Hot social trends. All such reports are to be strictly censored, the notice said.
The New York Times has a detailed report on this.
Once again, a campaign against ‘bourgeois liberalization’
Global Times said CCP has new rules that will “expel members who express support for bourgeois liberalization online.” We ran through the article twice trying to find out just what ‘bourgeois liberalization’ is. We didn’t find a definition but we did learn what behaviors can lead to expulsion under the label: “opposing the Party’s decisions on reforms and opening-up through online platforms,” “speaking out against the Party’s major principles online,” and betraying faith in the Party without discarding Party membership.
Also, criticizing problems like corruption, or the gap between rich and poor is also ‘bourgeois liberalization.’
Beijing-based historian Zhang Lifan (章立凡) said that the bourgeois liberalization being talked about now appears to be referring to freedom of thought outside the scope of the regime. “The ruling party has become the biggest landlord and the biggest capitalist in China; the crony capitalists are the real bourgeoisie, and they treat those who think and speak critically of them as ‘bourgeois liberalists.’” Zhang continued: “Raising once again the idea of anti-bourgeois liberalization is due to the Sino-US trade war of late, which brought out a lot of divergent views from within the party, and so now they’re clamping down on public opinion.”
Deng Xiaoping was the one who invented the term “anti-bourgeois liberalization,” because he was afraid that the opening up and reform he had championed would lead to the erosion of the Party’s ideology. In 1987, there was a national “anti-bourgeois liberalization” campaign in response to vibrant discussions of democratic values on university campuses.
Mass trials in Xinjiang; Uighurs are being shipped to other provinces
Many thanks are due to Twitter user @uyghurspeaker who has been translating reports from RFA’s Uighur service into both English and Chinese. We post below some of his tweets edited for clarity:
Kunes County, Ili, is reported to be holding mass trials in internment camps, sentencing around 500 prisoners on each occasion. Officials asked the inmates: “Will you eat halal or non-halal foods?” Those who answered “halal” were sentenced to 3-5 years. (link)
Mass trials are also taking place in camps in Tokkuzak, Kashgar. At least 50 people per day have been sentenced for 3-15 years. Nejmidin, the political commissar at the Bulaksu police station, said that he escorted a group of convicts to prison in Chinese provinces three weeks ago. (link)
These RFA reports about mass sentences in internment camps are consistent with recent news of railways closed-off in Urumqi, Gansu, and Qinghai for the purpose of dispatching Uighurs throughout prisons in China. That is, it appears the authorities are handing down sentences, then sending Uighurs to prisoners around the country. We first noted The Epoch Times’ reports of such news in Signs of China (2).
A RFA Chinese report, citing a Uighur service report on September 28, says that in a township in Kashgar, policemen were taking local Uighurs in internment camps to other provinces in China. They said the transfer started early this month.
The Chinese railway and Urumqi tourist bureau announced that “due to adjustment to the operation schedule of passenger trains,” starting October 22, the railway will not sell train tickets going to or leaving Xinjiang. It didn’t say when service will resume.
The Uighur writer and activist Ilshat Kokbore writes: “We’ve already heard some things about this. The farthest they’ve transferred Uighurs is to prisons in Heilongjiang.” Heilongjiang is China’s northernmost province, bordering Siberia.
More Uighur elites sentenced or sent to camps
According to an RFA report, Halmurat Ghopur, president of the Xinjiang Food and Drug Administration’s Department of Inspection and Supervision in the regional capital Urumqi, was taken into custody in November 2017 and is being held in an unknown location for “acts against the state,” sources in exile told RFA’s Uighur Service earlier this year. He was recently given a two-year suspended death sentence for exhibiting “separatist tendencies,” according to an official source.
According to a RFA Uighur-language service report, Sattar Savut, chief in the education bureau, and Yalkun Rozi, a writer, critic, and editor, as well as three others, were charged with separatism for teaching children about Uighur cultural figures. Sattar’s sentence was given with two years of reprieve, while Yalkun was reported to receive a life sentence.
‘Where are my family members?’
Member of the Uighur diaspora initiated a YouTube series in which overseas Uighurs tell stories of their loved ones who have gone missing, been tortured, or died in internment camps.
How much money do Chinese officials have in the United States?
The United States recently announced sanctions on PLA lieutenant general and director of the military’s Equipment Development Department, Li Shangfu (李尚福), because the department he led violated American sanctions by buying military equipment from Russia. The sanctions on Li include a visa ban that restricts him, and his agency, from U.S. financial transactions and access to any assets in the jurisdiction of the United States.
Some have asked: is there any evidence of the much-talked-about notion that high-level Party officials and relatives have assets in the United States? The Weibo account ‘Los Angeles Landlord’ (“洛杉矶房东”) recently reminded everyone of a case as a way of answering this question: “A shocking case took place in the San Francisco Bay Area last year, where a certain Tiffany Li (李凡妮) was charged with murder of a man. Bail of $70 million was put up. Tiffany’s Li’s mother, Li Jihong (李继红), traveled from China to the United States and submitted to the court real estate assets of $62 million, as well as $4 million in cash for the bail. This was the eighth largest bail amount in the history of the U.S. court system.”
According to the reporting of Apple Daily last year, a California property insurance company’s investigation revealed that Tiffany Li and her mother, personally and in a trust, had multiple properties in San Mateo and the elite areas of Hillsborough and Burlingame.
Internet users are adamant that Tiffany Li’s mother, Li Jihong, is the younger sister to Li Jinai (李继耐), former director of the General Political Department of the PLA.
The example of the Li family highlights why sanctions against characters like Li Shangfu might cause unease and panic among senior Communist Party officials who have family and vast wealth in the United States.
Men in Black on Tiananmen Square
PRC National Day is upon us (it falls on October 1), and security officers are now out in force on Tiananmen Square. The following video clip was posted online, showing the conspicuous ‘undercover’ officers in black suits, with black umbrellas. What is the purpose of the latter? So that if anything happens on the square, they can quickly open their umbrellas, cover the scene and prevent it from being seen or photographed.
Signs of China (1), September 16, 2018.
Signs of China (2), September 22, 2018.
China Change, September 22, 2018
Unsettling news from China emerges every week in a constant flow — on social media, in reports, and from our own sources in the country. Not every new development is suited to a fully fleshed-out analysis, and as with so much in China, many reports and developments cannot be immediately confirmed or properly evaluated. Nevertheless, while each individual brush stroke may not be decisive, upon stepping back a fuller picture begins to emerge. China Change catalogues and contextualizes these items so as to keep a growing awareness of changes in China. — The Editors
Local Government Debt: Going Bankrupt, or Raising More?
On September 13, the General Offices of both the Chinese Communist Party and the State Council jointly published a document giving ‘guiding opinions’ on limiting the debt that state-owned enterprises can take on. One line that attracted particular note said: “Local Government Financing Vehicles [LGFVs] whose assets are severely insufficient to collateralize their debts and have lost the ability to repay should engage in bankruptcy and restructuring, or liquidation proceedings, according to the law; resolutely guard against ‘Too Big to Fail,’ resolutely guard against the accumulation of risk becoming systemic risk.”
LGFVs are entities established by local governments around China, including fixed asset investment companies, real estate and urban development companies, and urban asset management companies. They invest in municipal construction and infrastructure projects, and are a de facto form of municipal debt (from 1995 to 2009 municipalities in China were forbidden from issuing bonds).
In early 2009 the People’s Bank of China (PBoC) and the China Banking Regulatory Commission (CBRC) issued the policy that gives the regulatory framework for this behavior, which “supports qualified local governments to organize infrastructure financing vehicles, issue debt, medium-term notes, and other financing instruments, in order to expand complementary financing channels for central government investment projects.”
Beijing economist Hu Xingdou (胡星斗) told Radio Free Asia (RFA) that the scale of LGFV debt in China has probably reached 40 trillion yuan, and the bankruptcy of LGFVs will likely cause serious losses among a very large investor base. “In particular, much municipal debt has been funded by Wealth Management Products [WMPs] sold through banks, and many people hold these products in their portfolios. A lot of people may lose their life savings.”
Chinese internet users remarked that bankruptcies in LGFVs equate to a default on the debt, and that a lot of people are going to lose their money. Some estimated that the number impacted in the coming LGFV bankruptcy wave will far outstrip, by an order of magnitude, the recent losses in the peer to peer investment sector, which saw thousands of angry investors protest in cities across China.
Yet even as municipal debt vehicles face bankruptcy, on August 14 the Ministry of Finance put out a circular demanding the rapid expansion of local government infrastructure bonds, which led to a massive rush of issuance. These bonds are the major way local governments finance their infrastructure expenditures. According to Xinhua, as of mid-September, around 200 billion yuan of new debt had been issued, which added to the August new issuance of 428 billion, making total new debt issuance in just 1.5 months over 600 billion yuan.
Why is so much new debt being issued even as the central government is warning against systemic risk and demanding the municipalities unable to support their debt initiative LGFV bankruptcy proceedings? We profess to have no clue.
The Government Wants Chinese to Spend, Spend, and Spend More
On September 20, the CCP and the State Council published a circular providing “a number of opinions” on encouraging more consumer spending: make the public increase their expenditures on food, clothing, accommodations, travel, and more; increase the quality and expand the number of things they spend money on (cultural products, travel, sports, health, retirement spending, housekeeping, education, training, children); create new consumer products, make them spend more online, consume more customized products, and also spend money on ‘smart’ technologies, fashion, and other popular trends. Rural residents are encouraged to up their consumption too.
Any economy is driven by investments, exports, and domestic consumption — but with the extraordinary growth of China’s fixed asset investment being largely exhausted, and exports facing tariffs from the Trump White House, the government seems desperate to boost consumption, even though it has been promoting it for some time now.
Someone in Zhongnanhai is evidently working overtime on these new opinions and demands, which are falling down like snowflakes.
Affirming for the 1001st Time That China’s Judiciary Is the Party’s Judiciary
Lawyer Liu Xiaoyuan noted the following piece of news: that on September 12 the Party Group of the Henan Higher People’s Court issued four circulars expelling from office 48 judges in the court. The circular attributed the decision to the provincial Party’s Organization Department. Liu Xiaoyuan notes that whether required by the provincial Party apparatus or decided upon by the court, going about it this way is against Chinese law. According to the Chinese constitution and the Law of the People’s Republic of China on the Organization of the People’s Courts, court presidents are elected by People’s Congresses at the same level; deputy court presidents, presiding judges, deputy presiding judges, and judges must be appointed and dismissed by the Standing Committee of People’s Congresses at their same level.
Meanwhile on September 17, the Ministry of Justice held a meeting in Yunnan for the promotion of “Party Building Work” among lawyers. Minister of Justice Fu Zhenghua (傅政华) spoke at the convocation, demanding that “the Party must assume comprehensive leadership in lawyer work; implement total coverage of Party Organization and Party Work across the legal field before the end of this year; guarantee the three year goal of Party building having achieved total coverage, total conformity, and total leadership by 2020.”
Is China Moving Muslim Internees to Other Parts of China in the Face of International Outcry?
The Chinese edition of The Epoch Times, a Falun Gong-associated newspaper, recently reported the following: “An official source in China recently obtained information from an associate in the police that over the last few days Uighurs in internment camps in Xinjiang have been distributed to different areas around the country. This work is being conducted with a high level of secrecy, and the travel routes used are all under police and military control. The source told The Epoch Times that 1,500 people were sent to the area he is in, and the police involved were all made to sign confidentiality agreements. The source speculated that, because the government plans to spread the 1-2 millions of Uighurs detainees, they would be sent to different prisons and detention centers, and he expressed the fear that the Uighurs might be killed.”
This reminds us that, in mid-August, there were rumors that internees from Xinjiang were being sent to Jiuquan (酒泉), Wuwei (武威) in Gansu province and Delhi (德令哈) and Golmud (格尔木) in Qinghai. A screenshot of a WeChat conversation describes an unusually heavy presence of security forces at train stations, and the understanding was that Uighurs were being transported.
Uighurs: More Professors Sent to Internment Camps; One Literary Editor Jumped to His Death; Highest Ranking Uighur Cadre So Far Sacked for ‘Corruption’
At least four senior Uighur officials from Kashgar University in Xinjiang have been removed from their posts for “two-faced” activities [i.e. disloyal to the CCP, critical of Party policies, or showing sympathy to targeted ethnic groups]. They include President Erkin Omer, vice president Muhter Abdughopur, and professors Qurban Osman and Gulnar Obul; information about them has been scrubbed from the university’s website. Read more.
According to a report by RFA’s Uighur service: Professor Azat Sultan, former President of Xinjiang Normal University and former chairman of Xinjiang chapter of China Federation of Literary and Art Circles, has been arrested for being a ‘double faced person.’ His whereabouts are unknown.
RFA Uighur service also reported that Keyser Keyum, the editor-in-chief of Literary Translation magazine, jumped from the 8th floor of his office building. It is said that he had received a call from police that day about sending him to ‘re-education’ camp.
On September 21 Xinhua reported that the deputy director of the National Develop and Reform Commission and director of the National Energy Administration, Nur Bekri, was suspected of severe violations of Party discipline and is being investigated by the Central Commission for Discipline Inspection. Hu Ping, a U.S.-based dissident, expressed horror at the news: “Nur Bekri was the chairman of the Xinjiang Uighur Autonomous Region in 2009 during the July 5 incident. In Xinjiang, the only other Uighur to be secretary of the region’s Party Committee was Saifuddin Azizi, and subsequently all Party Secretaries were Han, and the highest ranking Uighurs were only chairmen of the region [not chairmen of the Party Committee of the region]. And now, Bekri himself has been toppled. From this it can be seen how serious the situation is in Xinjiang, and how horrific the plight of Uighurs in China.”
Hu Ping noted that “according to Bekri’s official curriculum vitae, he received a Han education since he was a child and joined the Party in his early 20s. Following the July 5 incident he was promoted to the Central Committee during the 18th Party Congress, but didn’t remain in the Central Committee during the 19th Party Congress, nor become a deputy in the 13th National People’s Congress. It’s clear therefore that he had not been trusted by the Party center for some years already.”
On the second day of the riots in Xinjiang in July 2009, Bekri went on television to criticize Uighurbiz.net, a Chinese-language website run by Professor Ilham Tohti and his students, accusing it of “inciting violence and spreading rumors.” In March 2014 during the ‘Two Meetings’ in Beijing, Bekri told a press conference that the evidence showing that Ilham—arrested in January of 2014—had engaged in splittist activities was conclusive and unquestionable.
Ilham Tohti was sentenced to life imprisonment in 2014 and is currently being held in the Xinjiang No. 1 Prison. There has been almost no word about Ilham circumstances for the last two years, and many now worry about his health.
Moving Ordinary Residents out of Heart of Beijing
A social media post recently noted that following the expulsion of residents and demolition of buildings along Fuyou Street (府右街, the street along the west side of Zhongnanhai) and Xihuangcheng street (西皇城根, adjacent to Fuyou Street), a similar operation on the east side of Zhongnanhai has taken place, expelling residents along Nanchang and Beichang streets (南长街和北长街). The eviction and demolition notices stipulate that state leaders who live on these streets are not the targets of eviction. The post also said: “In the future, Nanchang street, Beichang street, and Fuyou street have all been closed off for regular traffic. According to the plan, in the next one to two years there will be a gradual eviction and demolition of residences on both sides on Jingshan (景山公园), the east of the Forbidden City, along Nanchizi and Beichizi streets (南池子和北池子), around Beihai park (北海公园), and around Shichahai (什刹海), in order to expand the living space for central Party leaders.” The elementary school on Beichang street, as well as Beijing 161 Middle School not far from Tiananmen, will both be relocated and incorporated into other schools.
We drew a rough outline of the area affected by the project based on the social media post:
Twitter User Detained for 10 Days for “Attacking Leaders of the Party and Country”
On September 11, a 42-year old Twitter user in Beijing, Quan Shixin (全世欣), went to the Haidian Public Security Bureau to request permission to demonstrate, and was administratively detained. He was released on September 21. The notice of administrative detention given to her said: “Quan Shixin used internet circumvention methods to attack the Party and state leaders on Twitter, the circumstances being severe. Thus she was administratively detained for 10 days.”
No Foreign Programs in Prime Time, and Foreigners Not Allowed in Key Positions on Chinese TV
On September 20, the National Radio and Television Administration published a draft version (for public comment) of a set of regulations regarding non-Chinese citizen involvement in television, broadcasting, and shows. The regulations apply to those from Hong Kong, Macau, Taiwan, and the rest of the world. The basic content is as follows: without the approval of the NRTA, TV outlets may not broadcast overseas programs from 7:00 p.m. to 10:00 p.m.; television stations may not spend more than 30% of their daily broadcast time on foreign films, shows, cartoons, documentaries, or other programs; the screenwriter and director of a program cannot both be foreign persons; male and female lead roles cannot both be played by foreigners; television and film producers who employ foreigners as creative staff must register the contract with the NRTA within five days of its signing.
Foreign television programs are popular in China, and it appears rules of this nature are meant to curb the availability of imported programs and the enthusiasm for them.
When a band in China named Fangu (反骨) [Rebels] applied for a permit to perform in Suzhou and Shanghai, the authorities told them to change their name before they could be approved. The band announced on social media that “due to force majeure, the band has temporarily changed its name to zhenggu (正骨) [Bone Correction], and we ask for your understanding.”
The Berlin Schaubuehne theatrical troupe’s performance of Henrik Ibsen’s An Enemy of the People has received a warm welcome in Chinese drama circles, but after three performances in Beijing the original plan to put on another two performances in Nanjing were cancelled. The authorities said that this was due to “technical reasons,” but is it possible that the drama’s storyline and theme felt a little too close to home for the Chinese authorities?
On September 15, the city of Jinan, Shandong Province, held a Rocket Music Festival (火箭音乐节); at one point during the event, when the audience felt particularly moved by the music, they began swaying their bodies together (as often happens at music festivals). At that moment, a police officer dashed onto the stage, stood at the microphone, stopped the music, and delivered a stern warning about public safety. “If you don’t cooperate, we’ll have to stop this performance [this elicited loud laughter]. Everything is subordinate to safety! If everyone is like you just were, then it absolutely cannot proceed. Everyone knows that our country is currently engaged in a special struggle in Sweeping the Black and Eliminating Evil… I’m watching everyone’s behavior from the stage. If there is danger, the performance could be stopped at any moment.”
‘Totalitarian’ Is the Word
Stein Ringen, Professor of Political Economy at King’s College in London, wrote a letter to fellow China analysts, asking that “we set our work straight in language.” “The People’s Republic of China is a totalitarian state,” he wrote. “Of its own kind, to be sure, hence neo-totalitarian, but totalitarian it is. No clarity of analysis is possible without clarity of language. The PRC is not ‘an authoritarian system,’ it is ‘a totalitarian state.’”
At China Change, we began to use the term “totalitarian,” “neo-totalitarian” and “market-totalitarian” in as early as 2013.
Signs of China (1), China Change, September 16, 2018.