Review: Red Roulette by Desmond Shum
An insider account of party corruption in China and of how businessmen managed to use the system to amass vast sums of money
Since 2021, the Chinese Communist Party (CCP) General Secretary (GS) Xi Jinping has called on the People’s Republic of China (PRC) to achieve “common prosperity” (gongtong fuyu). Although Xi has used the phrase more than 65 times in his speeches in 2021, it first appeared in the People’s Daily on September 25, 1953, when the paper published a list of 65 approved slogans for the commemoration of the fourth anniversary of the PRC. It aims to narrow the wealth gap between the “rich few” and “common many” and addresses the income disparity, which has the potential to threaten the legitimacy of CCP rule.
The reasons behind China’s move towards its socialist roots using the “common prosperity” campaign after 30 years of breathless economic growth can be gleaned from Desmond Shum’s Red Roulette: An Insider Story of Wealth, Power, Corruption, and Vengeance in Today’s China. Shum’s book is an insider account of party corruption and of how capitalists like him managed to use to system to amass vast sums of money through the persistent use of what the Chinese call “personal touch and relations” (guanxi).
Desmond Shum was born in Shanghai, raised in Hong Kong, and educated in Wisconsin. He collaborated with his wife Duan Weihong (Whitney) in business in the 1990s and early 2000s. Their major break came with the rise of “Auntie Zhang” or Zhang Beili, the spouse of then-Premier Wen Jiabao. The book revolves around how Shum and Duan exploited this relationship to amass wealth. It also highlights how the couple used Auntie Zhang’s network and interacted with multiple political characters to push their business agenda. The list included Sun Zhengcai, a rising party official thought to be Xi’s successor, and Ling Jihua, principal political advisor to GS Hu Jintao and the current PRC President Xi Jinping.
Auntie Zhang’s connections helped the couple develop the largest air cargo logistics facility in the PRC at the Beijing Airport Cargo Terminal. They also built the luxurious Bulgari Hotel in the heart of the Embassy District in Beijing. These achievements, Shum claims, were made possible by a culture of wining, dining and bribing, which capitalists in China employ to obtain party approvals. Troubles began to surface when The New York Times questioned Aunty Zhang’s wealth in 2012. It was the same year that Xi rose to power.
The decline of political opponents shouldn’t come as a surprise to China observers. Xi’s rise and his “anti-corruption” campaign to limit his political opponents marked the beginning of the downfall of Auntie Zhang, Sun and Li, among others. Shum and Duan crashed with them. Shum had to leave the country and Duan disappeared in 2017. Apparently, she was arrested by the Chinese authorities in 2017 and remains in custody without being charged. Shum states that the CCP swats down entrepreneurs who know too much, like Duan, or talk too much like Jack Ma, the founder of Alibaba.
This book presents a picture of China’s political reality since the turn of the century. Under Xi, the empires of tycoons considered close to his political opponents have been scrutinised, restructured, or dismantled. China is rewriting the rules of business, and those private entrepreneurs who are not aligned with the party’s priorities are expendable. As Shum warns, “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.”
Red Roulette also exposes the dark side of the governance of the CCP, which is not often visible due to the party’s strict control of the media. Unlike the popular belief that decision-making in China is restricted to a limited few, the book shows how it can be manipulated informally at all levels: central, provincial, municipal, prefectural, county, township and village. Although the stories in the book are not verifiable, and some have reportedly been falsified, it still provides the reader with insights into the system.
Now that Xi is on the verge of taking over as CCP General Secretary for the third time at the upcoming Party Congress later this year, it is evident that the era of runaway growth spurred on by unbridled capitalism – at least for his political opponents – is over. This was first made apparent when he spoke of “the eventual demise of capitalism and the ultimate victory of socialism” in an address to officials in January 2013. Since then, hundreds of Chinese billionaires and CEOs have disappeared. Some have emerged a few days, weeks or months later expressing their undying devotion to the CCP and Xi, while others like Duan are still serving prison sentences. Desmond Shum’s book highlights the corruption built into the structure of China’s governing institutions and shows how a select few used it to make a fortune during China’s glory days.
Suyash Desai is a research scholar currently studying traditional Chinese language at The National Sun Yat-Sen University, Kaohsiung, Taiwan.