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Lying to the Leader

Lying to the Leader
If they lie to their own dictator, will they tell us the truth?
By Michael Ledeen

Two years ago, Chinese dictator Xi Jinping sent Xu Lingyi, the Deputy Secretary of the Central Commission on Disciplinary Inspection, to the province of Shaanzi, to investigate charges that many luxury villas had been constructed over the past decade. The investigation led to the production of a 20,000-word document that shows that Xi is still being deceived by local officials, despite a purge of those involved, and the destruction of many of the villas they constructed.

The Xi’an report has found a home at the Epoch Times, which obtained the full text. It documents the widespread practice of lying, even to the top levels of the Chinese state. And odds are long that if they lie to the dictator, they will lie to us without blinking.

Lying is commonplace in China; indeed it is a basic tool for advancement. At each level of society, those with real information have many good reasons to invent it. There is invariably a dollar sign attached to each lie, while the truth has a price tag.

Over the past decade, United States counterintelligence has become acutely aware of this Chinese threat, and action against China has increased accordingly:

Two Chinese researchers with alleged ties to the Chinese military have been arrested on federal charges while attempting to board China-bound flights, according to separate criminal complaints unsealed on Aug. 28.

One of the arrested was Guan Lei, a 29-year-old researcher at the University of California, Los Angeles (UCLA), who was charged with destroying evidence to obstruct an investigation by the Federal Bureau of Investigations (FBI) into whether he had transferred sensitive U.S. software or data to China, the justice department said.

Also on Friday, University of Virginia (UVA) researcher Hu Haizhou, 34, was arrested and charged with theft of trade secrets and computer intrusion, the department announced. This came days after he was caught at a Chicago airport trying to transport back to China advanced computer codes that he allegedly stole from the university, prosecutors said.

The arrests of Guan and Hu are the latest in a long string of U.S. prosecutions targeting Beijing’s efforts to exploit American academic institutions for economic or military gain. They show yet again the degree to which Chinese officials are prepared to lie to one another in order to conceal the degree of corruption that exists within China.

A leaked internal Chinese government inspection report shows that Party leader Xi Jinping was lied to by close to 100 officials in his orders to destroy illegal villas in the Qinling Mountains in Shaanxi, which are known as the “dragon vein”.

The Dragon Vein shows how rational the policy of lying can be, and suggests that no “official” data coming out of China should be taken at face value. Every “source” reporting up the line has a reason to lie, and the lies multiply as one works one’s way up the reporting chain.

Official data are a hoax, designed to increase the income of Chinese bureaucrats, not to measure the productivity of the system.

The fraud constituted by the official data helps explain the urgency with which the Chinese pursue American technology, from universities to corporations. The recent arrests focus on whether the would-be smugglers were trying to destroy the material they had stolen from two leading U.S, universities, UCLA and the University of Virginia. Both were employed by their universities, and simultaneously by the Chinese military, a clear violation of their obligations under American law.

Under the circumstances, the relationship between the two biggest economies in the world is changing. There are two basic changes under way: the first shifting production from China to other countries with lower labor costs, the second changing to different shipping routes for goods produced in China itself:

U.S. brands have started to explore sourcing options closer to home, with Latin and South America gaining significant traction in recent months, according to a survey by Qima, a Hong Kong-based supply chain inspection company.

The survey conducted in July among more than 200 businesses around the world found that respondents are increasingly moving their sourcing away from China. Ninety-three percent of U.S. respondents reported that they had plans to further diversify their supply chains.

In addition to the expansion of Latin American ports and shippers, the United States has increased its use of Vietnam and Taiwan, and “for U.S.-based companies, sourcing destinations closer to their home country continue to grow steadily, with the popularity of Latin and South America almost doubling compared to last year.”

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