Corruption, power and the truth about my wife’s disappearance – with Desmond Shum
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Before we get into today's episode, I wanted to tell you about the live Chinese Whispers podcast I will be hosting at London's Battle of Ideas Festival. On the 19th of October, myself and a panel of special guests will be talking the latest on China's economic slowdown, and we'll be asking what are the social and political implications of it? Is China in decline?

Chinese Whispers listeners can get a 20% discount on the ticket price with the code WHISPERS24. Click the link in the description to find out more and get your ticket. Hello and welcome to Chinese Whispers with me, Cindy Yu. Every episode I'll be talking to journalists, experts and long-time China watchers about the latest in Chinese politics, society and more. There'll be a smattering of history to catch you up on the background knowledge and some context as well. How do the Chinese see these issues?

In the early 2000s, Desmond Shum and his wife Whitney Duan were among some of the richest people in China. They had their fingers in projects spreading from infrastructure to hospitality and real estate. And they had some of China's most influential politicians on speed dial. But that all changed in 2017 when Whitney was disappeared by the Chinese state. Desmond now lives in the UK where in 2021 he wrote his memoir Red Roulette. And he is now a commentator on Chinese politics.

He joins me today on Chinese Vespers. Desmond, welcome. Thank you for having me. Now, to start with, can we get you to introduce yourself and explain how you came to have a front row seat to Chinese politics in the 2000s? Oh, that's a long story. I first went back when I was born in Shanghai. I grew up in Hong Kong. I went to school in the States. And I started going back to China for business at the beginning of the 90s. So, 1993, 1994.

And I've been there in and out of China for about 30 some years. And I really, I think, yeah, the front row seat to the cause of my ex-wife. So we were we were a business partner with the premier Wenja Baoz family. And then it's well, it's well documented. Both basically broke apart by the New York Times story on my ex-wife. And that just come, I guess, that sort of

our foray into the global stage. You mentioned that New York Times expose, that was a really high profile one at the time. So just explain a little bit about the relationship of you and Whitney with those politicians. It wasn't just having friends in high places, it was more than that. You guys were white gloves, is that fair to say? Yeah, that's a generally used term of people who are basically in partnership with the power, with the political power figures,

and also fronting for them in business. So that's a general term, white-glove in Chinese

And in our case, we started doing business, I would say, but Winnie and I married in 2003, I believe, 2002, 2003. And we started doing business about 2003, 2004. So we were in business with them for about 15, 10, 15 years.

And in general, I gave very detailed description of how we do business with them, what our relationship, what are the interaction. So, yeah, so we were, you know, obviously, we were a lot more closer than just knowing them. We were, well, I mean, in Whitney's case, she sees, we call her Auntie Jia, which is the wife of Wenjia Bao on a daily basis.

And, you know, I talk about in the book, she's almost like a daughter to her. And then she, in a way, sees her in a similar fashion. And that's why she sort of stepped up to the place or take the responsibility for the fall of the New York Times story. And ultimately caused a lot of trouble for her, for us, you know, so...

Yep, and that New York Times story basically revealed the $2.7 billion worth of wealth that the Wen Jiabao family had amassed, some of them under proxy such as you and your wife, Whitney. The reporting, though, remarkably said that had Whitney saying that it was really her wealth and that she was using the Wen Jiabao family identities to divide and front up her own wealth and not the other way around. I mean, this is just incredible.

And it's also an explosive story because these were supposedly communist officials, but also particularly because Wen Jiabao himself always had a down-to-earth reputation. So that's why it was such a big story. So Desmond, what was that time like for you? They contacted us probably two weeks before New York Times, contacted us like two weeks before the story came out and said, well, we are planning to publish this story. And what do you have to, you know, do you have anything to say to this?

So, obviously, we scrambled with the Wens, the Wen family, and they said, well, you know, this is happening, you know, what you guys want to do? You know, when Auntie John said, well, tell Wendy, he said, well, you go out and talk to them and say, you know, basically everything, rationale, explanation, we gave to the New York Times and tried to persuade them not to publish it. It was this tension by the Wens.

And the reality actually at the time, I was telling Whitney just like, in general, in this kind of cases, you just stop talking to the media, right? You don't talk to them because it's nothing, you know, they write whatever they're going to, they're going to publish whatever they're going to publish. And then you basically let them do their thing and then you stay back. That's probably the best response. The more you speak, and especially in that kind of situation that

the more incriminated, so to speak, you will be. But, you know, the wen want her to step in the front and take the fall. And then she sort of

seeing almost, you know, she sees the Wens as patrons, almost to the extent of like a family elder, Auntie Janice to her. And she said, well, I'm going to do it for them. So she went out and then the story came out. And then basically it's sensationalized. I mean, the Wens and us obviously all together make a lot of money. The others, they probably make a billion about between the two, the Wens and us.

But, you know, it's painted as corruption. And then obviously, one is painted as corruption. We can go into detail. I don't see it as such. But the second is, you know, obviously, the first time one of the power figure, the power figure of China came out to be exposed to have that much wealth, which has never been done before.

And that's just a front page and it was sensational because it's ever happened on a power figure or PRC.

And the story seemed to blow over when Jiabao leaves office the next year in 2013 because his 10-year term is up. His leadership with Hu Jintao was replaced by Xi Jinping and Li Keqiang. But sadly, part of the reason you wrote your memoir is that Whitney was actually disappeared by the CCP in 2017. What happened there? I never know why she was disappeared. I mean, she was disappeared by the state. I mean, actually together with three of her colleagues were stopped.

So four of them were to disappear on the same day. And none of them was ever charged. She was disappeared for four years when she came out a few days before my memoir came out. Her staff came out a year before that. So they were disappeared for three years. And it's all, you know, we can all guess why it happened in such a way. But I would guess, I would say it's probably most likely our politics related.

given we were so closely related to Wen Jiabao. And Wen Jiabao still has a lasting influence. Has she now been released? There were a handful of reports of her in public last year. Yeah, she came out. She reached out to me like three days before my book came out, trying to persuade me not to publish it and not to release it. And then she had been out since. So she's...

She has relative freedom within China. They won't let her out of China. She's reachable. She's relatively free to travel within China. So that's incredible then.

She disappears in 2017 and by that time you had already got a divorce, I think. Yeah, we were divorced in 2014. Yeah, but the family were never told why she was detained, where she was detained. You share a young son and he never really knew what happened to her. To an extent, they didn't even tell anybody they had detained her.

I mean, you know, her family, her parents, nobody from her family ever heard from the authority she has been taken. She just, you know, vaporized on the street of Beijing and just gone. And then you just, the authority never take, they have taken her.

And in your book, you theorize that she was the victim of kind of political factions within the Chinese Communist Party, that the Wen faction, enemies of the Wen faction essentially wanted to get at her. Is that what you still think has happened? It is.

Well, actually, let me actually talk about two things in terms of power politics. The first thing is the New York Times story. The story came out, and then the New York Times obviously have a lot of documents. I mean, so this holding of the Ping An Insurance, which is the second largest insurance company in China, the shareholding of the company actually broke through multiple layers of company within China. And then the New York Times have the document to trace all the way back.

you know, obviously the Wen has a deep interest in how does that happen, right? I mean, you know, how does that happen? So Wen actually looked into it and then according to them, they share with us, it's like, it's from the Bo Xilai fashion. So Wen was instrumental in helping Xi Jinping to take out

When took down Bo Xilai, which is arch rival in a way to the power of Xi Jinping. If Bo Xilai wasn't out, you know, wasn't taken out and actually joined the Politburo, the history of China could be different. And it could very possibly be different.

And we can go into detail. So what we learned subsequently is fashion of member, the Bo Xilai, handed two cases of document to the New York Times journalist. And that's how the story happened. It wasn't investigate journalist.

How can you know that for sure? No two white guailo or journalists from America are going to go into China and dig through multiple layers of companies and then trace out a member of the Wang family to hold a share.

I mean, does anybody have any common, if anybody has any knowledge of China or just have a broad knowledge of China, we'll know that's not possible. So according to the Wen, that's what happened.

According to the one. Yeah. I mean, I would say that's very credible, right? I mean, this is the Wen Jiabao family, the premier family, looking into how the biggest news story of news in Chinese history happened on New York Times. And that's what they share with us. And I would think that's very credible. And I would think that's probably what happened. Yeah. So that's on the New York Times story.

In terms of Whitney's disappearance, so what happened if you look at Xi Jinping's administration, this is not something, you know, that's me making assumptions based on my knowledge and experience. His first administration always plays generally all about concentration of power, right? You look at all the dozens of most powerful political figures he's taken out.

The millions of people he arrested, bureaucrats he arrested, on the, I wouldn't say pretext, maybe that would be too strong a word, but on the allegation of corruption, right? Basically, he took down millions and everyone is because of corruption. Some of it, I think, is genuine. Plenty of it has, I wouldn't say the accusation is not genuine, but I would say the motive is not because of corruption. I mean, I believe the whole world understands that.

So, in terms of wins, the win, obviously, was last, for me, one of the most powerful figures in China. And he is also the political figure in China in the highest echelon of power, actually came out to say,

Democracy is a good thing. The institutional democratic reform is needed. Universal value is a good thing. Rich universal value today is actually, you can't even search the word universal value in China. It's a banned word.

So he's the figure who actually came out and said that. And for that, he actually has a lot of admiration within the Chinese society. So what are the usual tactics in power struggle in CCP is

Instead of attacking your target direct, you attack all the people around it. So in this case, it will be like, basically, it's one, it's all well known. It's well known that we are close to the West, right? We're close to the West. So he took custodian of her, and then that essentially sends multiple message to the West. One is,

I have you in my sight. So who is he? I mean, Xi Jinping. Right. So sending a message to the Wednesday, one is I have you, I have you in my sight. Even though Wen Jiabao was one of his supporters at the beginning in 2012. Yes. Two is I'm holding somebody who has inflammation on your family, which I can possibly use.

And so essentially that's the message. And then so you look at, you know, then basically sending message to the Wen Jiabao's line, you look at what you say and you look at how to behave. That's what it is. That's a very common tactic used in power struggle within China. So Whitney was an insurance policy.

It's not insurance bond, it's a warning sign. It's a warning signal to the whales. And you and Whitney, you know, you had such amazing success during that period. In your book, there's all sorts of incredible kind of insider scenes that you recount. Even stuff like after that New York Times expose that actually Wen Jiabao threatened to divorce his wife, divorce Auntie Zhang, Whitney's patron, and actually become a monk. And the party stopped him,

Tell us about that because I just wanted to, of the many gossip in your book, I just wanted to pick up on that particular bit. That was incredible. Yeah, because I mean, actually, one of the things my book talks about, and a lot of people actually don't believe it, is when Jiabao knows his family is in business, that he knows. I mean, Andy Zhang is one of the first entrepreneurs who run a restaurant company.

She runs a listed company, which is they own in jewelry. And so it's the first batch of listed, which was a rich, that company was the first batch of Shanghai listed company. So she knows business and then she, he knows she has, you know, she had business interests and then she runs around in the business world. What he doesn't know is how much wealth they have accumulated through that business.

That he doesn't know. This is his own wife. He didn't know his own wife had accumulated this amount of wealth. Yes, because the way their family run this, first of all, the two of them are very, very close. And then Auntie Zhang is...

He's the power figure within the family. She runs the house. And then, you know, she's busy, he's busy, and then he's, you know, on a job 24-7. And he takes care of everything around her and assists him in even political affairs. And I talk about it in my book. So, I mean, she generally doesn't know how much business is interested, how large a business empire they had built. And so when the New York Times story came out,

It really surprised him in a way, actually, he shocked him. And then he is a person, if you look at the way he has behaved over his 10 years in power, he's a person who cared, he cared the most about his legacy. That's what he cared the most. So obvious that story, the news completely destroys that.

And that's what really, I think that really deeply saddens him and affects him. And the reason he wants to say, I want to be a monk, you know, go out of the monastery,

is essentially the way to clean his name in his way, right? And then say, well, you know, I'm not the one who's sorting wealth. I'm not the one who, you know, I'm willing to go, you know, even to be a monk in a monastery. So that's the way he want to like clean his name, maintain his magazine. Then obviously that's, you know, but then the party will never allow that, right? That's emitting guilt, right?

And then obviously also, you know, a ex-Prime Minister, a Premier going to be a monk in our ministry, that's probably another sensational story for forever.

But the party will never allow that. You seem like you believe him that the second most powerful man in China at the time didn't know that his wife was amassing all this family wealth. It's surely that he just didn't want to know. No, it's not he didn't want to know. It's, you know, he know, he know. I mean, it's not obvious. How do you know, you know, your family actually were billionaires?

You see the cars, you see your family car change from an Audi to a Mercedes to whatever, but that doesn't mean nothing. I mean, his wife was individually wealthy because of her work in the listed company.

That's part of the thing that the world that your book describes. I think, you know, I would love for you to kind of illustrate that a bit more because for ordinary people watching this, you know, British or Chinese or American or whoever they are, the incredible wealth and extravagance.

of that period of time and of the world in which you inhabited, is I don't think it's very obvious that you say you can just change these fancy cars without even thinking about it. But actually, that was the ecosystem, that was the environment. So tell us about how that kind of extravagance lubricated the business and the political dealings of China at the time. Well, several things I want to say about that. First of all, when I wrote that, I know that's what I'm going to be criticised for.

I know that. I mean, you can imagine, right? We're talking about, you know, riding private jet to go into France to, you know, to drink like a hundred thousand dollar bottle of Bordeaux. You know, I know that. I mean, I'm not an idiot to the media world, but I still went ahead and talk about it and then tell all in the book is because

That is not me. I mean, I'm not talking me. I'm just talking about me. I'm recording a period of history, the top of the flight entrepreneur. That's how they behave. That's how we all behave. And when I say, oh, I mean, that crowd of like entrepreneurs, you know.

And also that's their outlook to the world. I mean, that's how they look at the world. That's how they present themselves to the world, how they behind the door, they, you know, they hold themselves. So I tell those parts, not because I'm proud of it or particularly want you to know how much, you know, I enjoy my life.

It is, I'm recording history, knowing that I'm going to get those wrote back. Right? I mean, if you look at, no, no, no. If you look at the criticism I have, when my book first came out, like the most of criticism is on that. People say, oh, you know, look at that. You know, he's,

so extravagant, ridiculously lavish, and all that. And it's just, for a lot of people that color their lenses, they look at the book and they look at me. But I want to bring that out because that is how that crowd and that world at that time behaved.

That's what struck me most. It wasn't that you particularly were bad or anything like that. It was just the world that you painted such that, you know, I think there was this, you were quite close to Xu Jiaying, the former founder of Evergrande, that real estate developer that's got into so much trouble and the extravagance that he had, you know, kind of turning down luxury yachts because they were too small and, you know, not big enough for what he wanted. Yeah.

This is a world that's unimaginable to most people and most Chinese. And I think it just really paints a picture of just how much wealth and corruption was happening at the top of Chinese business and politics at the time. And I think that's why it's important. Yeah, yeah. I'm presenting the world like how things actually run in, you know, behind the scenes. Yeah. But so...

Can you tell us about what that relationship between the party and business was like back then? And do you think that has changed now under Xi Jinping? Because in the last few years, we've seen billionaires like Jack Ma, like Su Dain that we've talked about, people who are punished, left the country, disappeared themselves. Do you think that world that you paint still exists? And especially after the anti-corruption drive as well?

Well, first of all, I would say that, you know, the anti-corruption drive, I mean, that world always will exist. When you have unchecked political power, which is not monitored by anyone, that world will always exist, right? So a book I particularly talk about is the current vice president of China, right? And then his daughter, what was it? There was

more than 20 years, yeah, about 20 some years ago, has the, has the, under the, so it's like 15 million US dollar cash

in a bank in Australia. I mean, obviously, $15 today in China doesn't seem like that 20 years ago, it was a quite an amount. Because I was talking to this Chinese and people, oh, that's not that much for a person of his status. And I was like, well, that's 20-some years ago, okay? And then they say, oh, okay, 20-some years ago, it's quite a bit of money. And that's not a rumor or anything. It's the party found out themselves.

So at the time, it was a power struggle. The party secretary was arrested by the Wu Jintao and Wen administration. So they were looking, you know, usually what happened when you arrest a party secretary, the mayor steps up to be the party secretary.

And so they were looking into the mayor, the affair, and then they find out, oh, he has a daughter in a university in Australia at the time, and has 15 million US in the bank. And that's the reason he was sidelined, and Xi Jinping came in to be the party secretary of Shanghai.

So, and then, so at the time, the reason they didn't arrest him is because they say, well, Shanghai is the most important financial city of China. If we arrest the party secretary and we arrest the mayor, it will be complete chaos. And they don't want that. So you can, from that, it's a terrible message, right? Law is flexible. Law is the selective reply. So I thought at the time, I was like, oh, wow, you know, when I heard, you know, we learn all this from the West.

When I learned that, I was like, wow, okay, wow, that's something. And the second thing I thought was that must be the end of his political career. Well, God forbid, now today he's the second vice president of China, right? And then he also promoted by Xi Jinping, right? I mean, and obviously in China, the CCP has a fire on everybody, a special figure of that sort. So it is not, Xi Jinping has no way of it. So when you look at that particular case, then you say where, you know,

Really? Is it really all about anti-corruption? That's just one very well-known case I personally report in time. If you look at other cases, the current head of People's Congress, it's well-documented, reported in global financial papers. His daughter and his daughter's boyfriend had a run on the pension hotel in Hong Kong.

and want to do a hostile takeover of a pan-insular hotel. This is documented. This is basically the daughter-in-law of this head of People's Congress. And then it was exposed in the paper, and then he sold all the shares, and then no longer be on the scene. And it just happened under his administration. So anti-corruption, yes. I mean,

I mean, it's definitely a cleansing, but it's also a cleansing of rivals, cleansing of people who he doesn't trust enough or doesn't trust as much.

But then the next batch come on with unchecked political, the same game goes on. It just goes on. The game was played by different group B. Do you think that the game has changed in a sense that there are not so much factions anymore under Xi Jinping today than there were when you were wheeling and dealing, as it were? Yeah, that I agree. That I agree. There's Xi faction and...

I wouldn't say the other fashion exists, but it's definitely not as powerful and a lot of it is laying low and underground. Because he has managed to centralize power so much through the methods that you've already described. Yes, and they crush everybody and he arrests so many. The rest actually this year, the first nine months are the rest of high-ranking politicians

because in the financial industry, it's the highest it has been in the early days. Well, that strikes me as the other thing that's changed, that even if it's not about tackling corruption, Xi Jinping has taken more control of the private sector. And he doesn't seem to care about damaging business confidence or investor confidence when he starts to kind of tackle people like Jack Ma and Xu Jiaying and other financiers. That seems to have had a repercussion in terms of China's economic slowdown.

Yes, that's why I wrote on my Twitter, and you may have seen it, is when you look at Xi Jinping, the first thing we really need to recognize and put in front and center is he's a man of belief. I mean, he has belief. I mean, he's not just like some people presented. He's just hungry for power and wants to be a prebend dictator.

He is a man of belief. He believed that the Communist Party should have eternal power in China. So that's the first thing. And the second thing, because of that belief, he is, in his mind, he's trading short-term

sacrifice for long-term gain. Even when he first came into pilot, he said, you know, knowing that, you know, his crush on the private enterprise, the technology industry, the tech titans, real estate industry, and all that will do damage to the Chinese economy. But as he said, well, I'm willing to sacrifice these short-term losses in order to the long-term gain to sort of defer

political power of the Communist Party, because he sees all those things are eroding and taking power away from the diffusing power throughout a society taking power from the party. So he's willing to do that. But what I always you know, I always call him stupid is because he failed to realize

the pain and suffering and losses he inflicted is so severe, he actually changed the trajectory of China to the extent that now he's retreating. He's taking tactical retreats because the trajectory is

completely changed and the downturn is still severe, it actually may be turning into a long-term loss in terms of a long-term gain. Can you elaborate on that? Because that's quite a bold claim that he's turned the trajectory of China's economic success. That's a really big mistake if that is the case. But China, if I were, let's say, the Chinese foreign ministry now, I would say China is still growing at 6%.

somewhere between 3% to 5% of GDP every year. That's economic growth that other countries would kill for. China has bright spots in its economy, such as renewable energy, such as semiconductors, more and more obviously subject to American export controls. There are reasons for optimism in China's economy.

and that all economies go through cyclical phases. Why do you think that actually he's done such a drastic thing that he's actually turned the trajectory? First of all, I think it's two things. First of all, I think nobody believed that the growth number is what they presented. I mean, nobody believed it. Everybody thinks below, it's beneath that, but people disagree how much is beneath that. I mean, I have seen very credible economists, I can, you know, send you their names, came out and say,

the year before the China GDP growth is negative. Instead of 3% presented by the state, it's actually negative minus one to minus two. China in recession. So, yeah. And nobody believed this 5% they're calling it is actually 5%. And then you look at the news on the ground, nobody can tell you that's 5%. Yeah. And so that's just like an offline figure. But you look at everything, right? You're looking at

the situation China's export industry face for investment coming into China. You look at the domestic infrastructure spending, you know, how much you can build, right? And you look at the consumer spending, it's all about pink door, door, downgrading or spend, you know, number. So everything is going south. And then the reason, you know,

We joke around within the Chinese community. It's like, he was handed a great hand of playing a poker game. He was handed a great hand.

And we cannot imagine he played a game to such, you know, so lousy. That's where we are at this moment. You know, when he came in, China was going at 8%. You know, those are the decades actually China was suppressing the number. They were growing at 10%. They say, well, we are actually growing only at 8%. Now we are a different game. Gaming is going to grow at 5% this year. But nobody believes it's going to grow over 5%. And so I was guessing how much beneath 5% it's actually happening. So.

This reminds me of an incredible conversation that I was party to earlier in the year in Shanghai with some very high net worth business people who were all kind of sitting around the dinner table thinking,

What's his plan? You know, they were all trying to figure it out. And you can see that in front, especially in front of a foreign journalist, they didn't want to say anything negative. But the underlying message was totally, I'm totally baffled. I don't understand where he's taking the economy, what his long term plan is. And one of them actually said, I can only imagine that he does have a plan and I'm too stupid to understand it.

Yes.

One of the reasons I particularly wanted to talk to you now is because of this recent reporting from the Financial Times that some primary school teachers in some parts of China have been asked to hand in their passports to the local authorities and they have to apply to have foreign travel. Now, that just struck me so hard because, of course, local authorities sometimes take passports of party cadres, very senior public sector servants, and their movements are tracked. We know this.

But for primary school teachers to even apply for a foreign holiday, that just seems so like the antithesis of what we have come to associate with modern Chinese identity, or at least since reform and opening, you know, these Chinese tour groups that are all over the world to the extent that they've become a bit of a hassle to a lot of people.

And it just seems like all of that is turning back on a social element as well. Yeah, but one of the things I have been saying and I try to illustrate with my own story in the book is things change not...

sort of revert back to the communist, you know, our idea of how our communist-controlled country is run after the financial crisis of 2008. It doesn't change under Xi Jinping. It quickens, you know, and then he took it to another pace during his administration, but it didn't stop with him.

So, taking passport away from... It started actually before Xi Jinping, and I deal with them. So, even in 2000, around 2010, they start taking... It's a gradual process. So, first, like, okay, the bureaucrats, you can travel overseas...

And for a period of time in the 2000s, it wasn't checked. Basically, you get some excuse, you go into an exhibition, you're doing company visits, you get invitations, then you can go. And then it becomes like, okay, you can go, but only within 15 days. And within the 15 days, you can do more than three countries.

And then it becomes, okay, within 13 days, no more district country. And then you have to hand your passport back after you went. And so at the end of the bureaucrats ranking who need to be, who are under control becomes like it permeates, it permeates, right? Like more and more bureaucrats can get, you know, get catched with that.

So it doesn't really start with Xi Jinping. It's just the net has broadened over time. Why was 2008 the turning point? I think 2008 really changed the perspective, not just the party. Actually, at the time, it was the entire society's perspective of politics.

what's the model China wants to go with? And so what, recount the history of that. So before the 2008, you know, 90s and that, even Deng Xiaoping, you know, the reason he said, you know, in Hong Kong, the 50 years

You say, you know, you can still do karaoke dance, you can still horse racing in Hong Kong, it's going to go on for 50 years. Because basically not, you got to revert to us, we got to come to you, right? We got to merge, we got to be more and more like you, right? So before the financial crisis, the general consensus within the party and the broader societies, we got to be more and more like the West.

The disagreement is like, "At what pace are we going to move? At what pace are we going to change?" That was the broad consensus. The financial crisis, what happened with it was all of a sudden, all the democratic world, the economy, the state finance, and all that was in trouble.

and then spread over to Asia. And then the Western countries, the democratic countries were looking to China. They said, well, at the time, they were looking at whether China was going to hold an exchange rate. If China is not going to hold an exchange rate, we have to worry about export numbers and then

Then it would lead another round of depreciation across Asia, and it would further destabilize the entire economy globally. Wen Jiabao hold exchange rate, he launched the all-famous now 4 trillion yuan stimulus plan. And that really changed the trajectory of the global economy at that point.

And that was a time the Chinese actually all of a sudden looked at themselves and they said, well, actually, their system's not that great, and our system is not that bad. And that's the China model and all that, that we need to try our own course now. Now Xi Jinping is everything is the China careeristic, culturally China careeristic.

like socialism or with China's characteristics. Everything is with China's characteristics. So that really changed the perspective of the entire society and particularly the political elites. How they look at the world, how they look at their own system, where they want to take the country. But see, China's success in 2008 could also lead to a different conclusion that actually this state-led capitalism

The way in which business people like you worked with politics was, you know, the state first, but also letting the market in and with a fair amount of, you know, backdoor deals and that kind of stuff. Surely the conclusion is that that has been working for China. But what China is now economically is much tighter, much less market-tised.

and much more arbitrary in terms of state power. That surely isn't the winning model that got China to where it was in 2008. You know, that's not a Deng Xiaoping model. So what happened in 2008 was...

Until the 2008, generally it's all about privatization, all about letting market take the lead. In the book, I even talk about episode, we have dinner with Wang Qishan, the vice president of China. And he was telling us, we're going to sell off their assets, get your capital ready when the floodgates open.

And so you can tell, Yuan Shisan was believing that's the route they're going to take. What happened in the financial crisis was they want to deploy a huge amount of capital in a very, very fast way. And then they find out that the fastest way to deploy that is through the stay-on-enterprise.

Because you work through the market, you work through private enterprises, you cannot tell the private companies, "Well, tomorrow you're going to put $100 million to work." It doesn't work like that, right? You work for the banking industry, you reduce the interest rate, then you have to wait until the enterprise, the consumer come in to take out their loans and put it to work. It's a process.

But the failing enterprise, they say, well, tomorrow you start 10 projects and I want you to double the speed and then start tomorrow. And then they tell the banks, which are all stay-owned, say, well, you put $100 million into that company's bank account tomorrow. And then so it's a direct command. And obviously, a situation like that, it's not more efficient.

All quicker, not necessarily more efficient. They really changed the perspective. They said, well, wow, if we lose that direct command in some situation like this, what are we going to do? Yeah. Right? And then they look at how effective it is now we having our company, state-owned enterprise, directly under command. And that really changed the story. Mm.

Desmond, there's so much more I want to talk to you about, but I'm mindful I've taken up so much of your time already. So let's just bring this back to the experience of your family then. Have you spoken to Whitney since she's been released? Has she told you about what happened to her during those years? I mean, I talked to her at the beginning when she first came out and...

I'm sure she's fully aware of it. I'm aware of it. Her phone was being tapped into. She's not going to say anything negative of the States. If anything, she's going to sing the glory song of the Polish party. And she can't leave the country, presumably, and you would not be able to go to China. I go in, I wouldn't come out. Yeah.

And since, you know, this ordeal and your books come out, you know, you've been quite outspoken. You know, even in this interview, you've been quite outspoken about your criticisms of the party, of the ugly parts that are behind the scenes that the party doesn't want people to know about. Are you afraid of the repercussions of that? To publish a book is a struggle. I mean, that's a real struggle. Then you put yourself in the bucket list of the party.

Once I went ahead with it, then in my mind, it's like the heck of the list. It's too late. I'm already on the target list. What else can happen? Well, thank you so much, Desmond. I'm sure this won't be the last time I try to get you on Chinese Whispers, but thank you so much for your time today. Oh, thank you. Thank you for having me.

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