Zhou Yongkang Used Start in Oil Industry to Rise to Public Security Czar
(Beijing) – Zhou Yongkang, a former member of the Politburo Standing Committee, the Communist Party's supreme decision-making body, has been the highest ranking party cadre to be a target of a corruption investigation.
The party's graft fighters announced the investigation into Zhou on July 29, after having rounded up a number of his allies in Sichuan Province and China National Petroleum Corp., where he used to work.
The 31 years Zhou spent in the oil industry paved the way for his ascendance to the Politburo. They also meant a lot to him personally.
He left Liaoning for Beijing in 1985 to become vice minister at the old Ministry of Petroleum Industry. In 1988, the ministry was dissolved and most of its assets were used to form China National Petroleum and Natural Gas Corp., the predecessor of China National Petroleum Corp. (CNPC). Zhou was appointed deputy general manager of the new company.
From 1989 to 1990, Zhou was party secretary and commander of the Tarim Oil Exploration Campaign, a project to exploit oil reserves in the desert of southern Xinjiang. Concurrently, he held the posts of party secretary and director general of Shengli Petroleum Administration, a Sinopec subsidiary, and party secretary of Dongying, a city in Shandong Province near the Shengli oilfield. During those two years, Zhou frequently traveled between Tarim, Dongying and Beijing.
In the preface he wrote for a book on the Tarim Oil Exploration Campaign authored by Wang Tao, the oil company's then general manager, Zhou said the campaign established an oil company management model with Chinese characteristics, featuring modern corporate governance mechanisms such as a bidding-and-tendering system for projects development.
The book says that in May 1989, upon receiving tip-offs about violations of internal financial regulations at the Tarim exploration team, Zhou immediately sent auditors to investigate the problem and punished the perpetrators. The results were published to serve as a warning to all employees in the firm.
It also recalls that Zhou was trapped in Tarim's inhospitable Taklimakan Desert once when his helicopter could not take off in a sandstorm.
As of 1993, the oil company had found six oil fields in Tarim with known reserves of 280 million tons and built facilities with an annual production capacity of 1.6 million tons.
During his tenure at the Shengli oilfield, Zhou made the acquaintance of Jiang Jiemin, who became his close ally and would eventually make it to the top of CNPC.
In December 1996, Zhou took over the positions of the retiring Wang, becoming the oil company's general manager and secretary of its Leading Party Members' Group. In January 1997, Jiang Zemin and Li Peng, then China's premier, met with the firm's top leaders, including Zhou, in Beijing's Great Hall of the People. Zhou became a member of the party's Central Committee later that year.
"Zhou is aggressive and assertive in the sense that he always makes his own judgment after hearing people's opinions and sticks to his decisions no matter what others say," a source with the oil company's exploration force said. "Objectively speaking, he is very well suited to be a leader."
Zhou has been behind several of the firm's biggest achievements, including beginning to accept foreign investment in domestic oil exploration and submitting winning bids for oil projects in foreign countries. It was also during his reign that the firm started to restructure its share ownership and prepare to go public.
On March 10, 1998, the ninth National People's Congress passed a plan to reform the structure of the State Council, China's cabinet, which included forming the Ministry of Land and Resources (MLR) by merging four existing departments. Zhou was appointed to head the new ministry.
It was not an easy job to integrate the four departments, but Zhou handled it gracefully – in part because he immediately ordered the construction of more spacious homes for MLR's engineers, a decision that made him popular among the workers.
Zhou spent less than two years at the MLR and was transferred to Sichuan as secretary of its party committee in December 1999.
The Sichuan Years
In Sichuan, Zhou prioritized the development of information technology and promoted the modernization of agriculture, taking advantage of the central government's support for development of the country's western region. Sichuan's GDP went from 401 billion yuan in 2000 to 487.5 billion yuan in 2002, posting annual growth rates of 9.0, 9.2, and 10.6 percent.
"Zhou is very vigorous and resolute. He marked a sharp break from Sichuan's old bureaucracy style," an official familiar with Zhou's tenure said.
"In the past, Sichuan was little more than a big agricultural province, and things moved slowly. Zhou's arrival brought some new ideas."
The emphasis he gave to information technology, for example, laid the foundation for Chengdu's development as a center for the telecom industry. His legacy includes the city's cooperation with Intel Corp.'s arm in China. Negotiations started in 2001 and in 2003, soon after he left, Intel announced that it would invest US$ 375 million in Chengdu to build its first assembly facility in China.
That was the largest single foreign investment the city had ever received. Since then, Intel has increased its financial commitments in Chengdu and enlarged its operations. By 2012, nearly 50 of world's top 500 IT enterprises had a presence in the city.
Zhou has also been credited with improving agricultural yields in Sichuan using modern technology and management techniques. He created two pilot zones and encouraged other regions to learn from their success. From 2000 to 2002, the total output of farming, forestry, animal husbandry and fishing in Sichuan increased by 11 percent.
Zhou also emphasized tourism development. Sichuan lagged far behind Yunnan Province in terms of management of scenic areas, and site operators were known for ripping off visitors. The problems were brought up to Zhou about one year after he took the reins, a source close to him said. And Zhou's reply was: "Come back and you'll find that great changes have been made."
In the first six months after he arrived in Sichuan, major transportation accidents, including a series of ferry disasters, killed a total of 3,000 people.
"Zhou was livid and lambasted the provincial governor," a source close to the situation said. The accidents prompted Zhou to tighten safety regulations, he added.
In 2002, Zhou for the first time raised the idea that Sichuan needs to adopt a "leapfrog" model of development to close the gap with China's more prosperous eastern regions. But he did not stay in the province to see it through. In early December 2002, he left to return to the central government, this time as Minister of Public Security.
In his farewell speech, Zhou said he had been "educated deeply by his experience in Sichuan" and "would always care about the province and wholeheartedly support Sichuan's development" wherever he went.
Indeed, through his protégés and allies in the provincial party committee, Zhou's influence in Sichuan persisted long after he left.
Three people – Li Chongxi, Guo Yongxiang and Li Chuncheng – feature prominently in the network of allies he left behind.
Li Chongxi served as deputy secretary of the Sichuan party committee for almost 10 years, starting in May 2002. For five of those years, he also served as the secretary of the provincial party's discipline inspection commission.
"He is sophisticated, discreet and stern and has a strong influence inside the discipline inspection system," a source with the Sichuan government said.
Guo, on the other hand, "is smooth and slick … He always had a smile on his face and was willing to do small favors," a former colleague of his said. He also said Guo is an eloquent speaker and has a good memory.
Guo had spent 26 years in the oil industry before following Zhou to the MLR in 1998 as director of its general office. Zhou brought him to Sichuan as his personal secretary in 2000.
In Sichuan, Guo is known for his connections. The locals view him "as the eyes and ears of Zhou Yongkang, and at times his go-between," a source familiar with him said.
After Zhou left for Beijing, Guo remained in Sichuan and became vice governor in January 2006. He oversaw agriculture, forestry and water projects. He retired as vice governor in 2008 and was elected vice chairman of the provincial people's congress and appointed president of the Sichuan Federation of Literary and Art Circles.
Li Chuncheng, a 56-year-old native of Liaoning Province, worked his way up in the northern city of Harbin, the capital of Heilongjiang Province, where he served as the city's deputy mayor until moving to Chengdu in 1998. At first he served in the Sichuan capital as deputy mayor. Later, he oversaw the city's rapid expansion as mayor from 2001 until 2011.
In November 2002, Li Chuncheng was elected an alternate member of the 16th Central Committee. The next year, he became the secretary of Chengdu's party committee.
One of Li Chuncheng's main projects was revitalization of the northern part of Chengdu, where struggling, state-owned military factories were concentrated. His plan was to move these firms out and open up the area to retail development and the financial, tourism and entertainment industries.
Zhou returned to Sichuan at least six times after he left for Beijing. On two of the trips in 2010, he praised Li's revitalization efforts, saying they should be expanded.
With Li as mayor, Chengdu saw rapid GDP growth. He was acclaimed by economists as the rare official who understands the field. Economist Zhang Wuchang, for example, described him as someone who "has good sense and raises hard questions."
Li Chuncheng failed to be reelected as an alternate member of the Central Committee at the 17th party congress. Sources with knowledge of the matter said it was because he was implicated in a bribery investigation involving Han Guizhi, a former chairman of the political advisory body in Heilongjiang Province. But at the 18th congress in November 2012, he became a Central Committee alternate again.
"Li Chuncheng was not in Zhou's innermost circle, but his control of Chengdu as its two-term party secretary perpetuated Zhou's influence in Sichuan," an official familiar close to the situation said.
At the age of 60, Zhou joined the Politburo in November 2002. In December of that year, he started serving as the deputy secretary of the Central Politics and Law Committee, a position that had been vacant for almost five years.
Also in December, he was selected as minister of public security, becoming the first Politburo member to concurrently hold that position in nearly three decades. In March 2003, Zhou became a state councilor.
In November 2003, the Ministry of Public Security released a policy document setting up the framework for what was to become an unprecedented campaign to maintain social stability.
The policy says the priority of all public security organs is to protect national security and ensure social stability, with special emphasis on preventing and properly handling "mass incidents," the official term for rallies not sanctioned by the government.
It also urges localities to include their top public security officials on local party committees, a practice that some say would wrongly place the police force above the courts and the judiciary system.
That is because court presidents and chief prosecutors normally do not serve on their local party committee. Instead they hold a bureaucratic rank above that of the jurisdiction's public security chief – reflecting the superiority of the law over the police forces.
Critics fear that this relationship could be turned upside down if local security chiefs sit on the party committee. Proponents claim the arrangement allows better coordination.
As of May 2011, the security chief of 26 of the country's 33 provinces, municipalities and autonomous regions concurrently held a position on the party committee at the same level.
Zhou took over the security ministry while crime was on the rise and the police were being accused of abusing their power and selective enforcement.
Meanwhile, security bureaus complained about budgetary shortfalls. Many were forced to rely on excessive and arbitrary charges and every policeman faced a task of collecting a certain amount of fines from traffic rule violators and prostitutes, said Lu Zhuo, who was then in charge of the Sichuan provincial public security department.
"A major source of police corruption lies in that the police have become a for-profit business, and that inevitably affects their enforcement," Lu said.
The provincial government surveyed police spending in 2003. It singled out one county with a population of 1 million, saying that the government paid for only one-fifth of the local police bureau's expenses, or about 27 million yuan every year. To make up the shortfall, the police had to collect fines and charges equal to 20 yuan for every resident in the county.
Lu started pushing for reforms to change the situation in 2003 and was behind the provincial government's decision in the next year to ensure that the budget covers the police's expenditures. The moves took place not long after Zhou left Sichuan and were widely considered to have been supported by him. In 2005, Lu was demoted for violating land use regulations.
Meanwhile, police were getting more and more involved in carrying out local government orders such as forced demolitions and solving disputes, which are not part of their legal mandate. Zhou's approach also seemed to be changing. He rebuilt the security ministry's offices, improved the work environment and, according to the ministry's former employees, solved the housing problem for several hundred senior officials in the ministry.
He also organized several large-scale movements, including one implemented in 2003 that imposed "five bans" prohibiting the police from drunk driving, drinking while carrying guns and gambling, among other things. The existing regulations already included the prohibitions, but Zhou summed them up neatly, observers said.
Also in that year, the ministry required all workers to study the central government's policies and discuss how to implement them. In 2004, it required all units to train employees in special sessions to improve their knowledge and combat skills. In 2005, it launched yet another campaign, requiring all police units to "open the gate" so every petitioner with a grievance can meet with the head of the police bureau. The next year, the ministry said all police units should be dedicated to building firm connections with grassroots people for the next three years.
Responses to these movements were mixed. Some said they improved the public security system's ability to fight crimes, while other said the cost outweighed the benefit.
Wu Boxin, a professor at the People's Public Security University, said the movements were reminiscent of the ideological campaigns in the old days and the grandiose pursuits masked real problems that needed fixing.
During that time, more than 90 percent of petitioners stopped their complaints, the ministry's data shows. What it does not show, however, is that local governments and police increasingly used violence to force petitioners into dropping their case. "Black jails," facilities set up to hold petitioners illegally, became common as a result.
"During Zhou's tenure at the ministry, there were improvements regarding the norms of police behavior, but the boundaries of police power were expanded and the relations between the police and the people were further strained," a politics observer who declined to be named said.
This is partly because the improvements were made through rule by man instead of by law, he said. "When Zhou and people like him have had a taste of the benefits a small group can have by using the machine of state violence without restraints, all they can think becomes how to make the best of the power rather than limiting it."
Reaching the Top
Zhou's political career reached its zenith when he was elected in 2007 to be a member of the Politburo Standing Committee. He also became the secretary of the law committee and headed the Central Leading Group on Maintaining Stability.
Over the next five years, maintaining social stability received unprecedented attention from the higher-ups as Beijing hosted the summer Olympics in 2008 and celebrated the 50th anniversary of the founding of the country in 2009. In 2010, Shanghai hosted the World Expo.
Zhou was able to consolidate his power during those years by cracking down on petitioners in the name of maintaining social order. Many villagers in his hometown in Wuxi, Jiangsu Province, have been victims of forced demolition and illegal detention as they tried to have higher-level authorities hear their grievance.
People started blaming Zhou for the mistreatment they suffered, and many would vent their anger by calling out Zhou's name in front of the surveillance camera at the gate of his office in Beijing, a villager said. He never showed up.
Zhou also arranged for an official's performance in maintaining social stability to become a key criterion in assessments. It was so important that a poor score in this field could override all achievements in other categories. Even courts have been required to help maintain stability, a job that critics say conflicts with judicial independence.
"As long as it can stop people from continuing to petition, no one dared to say a word regardless of the measures taken, indulging or coercive, even when they were clearly against the law," a former judge who had worked in the system for almost three decades said.
Zhou was a firm supporter of Bo Xilai. Bo, a former Politburo member and Chongqing party boss, was convicted of bribery, embezzlement and abuse of power and is now serving a life sentence.
Bo started a campaign against crime in Chongqing in June 2009. As of October 25 that year, the police had caught 2,915 suspects.
One month into the operation, the law committee said it issued guiding opinions for all local units to crack down on crimes. Three months later, the Chongqing government announced the progress of its anti-crime campaign, saying it was implementing the committee's requirement to eradicate crime. Soon after that, Liu Guanglei, secretary of the committee's unit in Chongqing, said: "It was the central government's required move to deepen the targeted battle against evil and criminal forces."
The municipal government also said Zhou highly approved of its effort, saying that it was good for the people and society.
During the next years' annual legislative meetings, Zhou met with representatives from Chongqing and praised the city's achievements in fighting crime. Bo chaired the meeting and thanked Zhou for his support.
Zhou also spoke highly of Chongqing's effort to put sales of seized property online. The website rmfysszc.gov.cn, a national platform for such sales opened by the Supreme People's Court in 2012, was modeled on that of Chongqing.
Wang Fenghai, former deputy secretary-general of the China Association of Auctioneers, a trade group, said Shanghai also had a similar auctioning platform and many thought it was better.
"But the key is not about which platform to choose, but to follow laws and procedures while choosing, so monopoly and arbitrary decisions by leaders can be prevented," he said.
Zhou praised almost all of Chongqing's policies and political efforts under Bo's rule and said many of them should be expanded.
We may never know whether the compliments were only a tool for political alliance or he actually meant it. But even after Wang Lijun, the former security chief of Chongqing, turned against Bo in a dramatically public manner that led to Bo's downfall, Zhou still met with Bo, while others shied away during the annual legislature's meeting in March 2012. A month later, Bo was placed under investigation by the party.
(Rewritten by Wang Yuqian)
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