REUTERS/Jason Lee
Zhou Yongkang
Zhou Yongkang, one of China's most powerful politicians is officially being investigated for suspected "serious disciplinary violation."
In the scope of Xi Jinping's corruption crackdown aimed at tigers (high ranking officials) and flies (low ranking officials), Xi has snared himself a tiger.
71-year old Zhou is a former member of the Politburo Standing Committee (PSC) — the most important decision making body in the Chinese Communist Party.
Zhou rose through the ranks from China's oilfields. He began as a technician at the Daqing oilfield in Heilongjiang and eventually became head of the Liaohe oil sector, reports Keith Zhai at South China Morning Post. In 1996, he became head of China National Petroleum Corporation (CNPC). From Zhai:
Most of Zhou’s top aides from the oil sector days have also been detained, including Li Hualin, CNPC’s vice-general manager and Zhou’s former personal secretary . Zhou’s family members are also under investigation for alleged unlawful deals involving the CNPC, including Zhou’s eldest son Zhou Bin, daughter-in-law Huang Wan, his brother Zhou Yuanqing, sister-in-law Zhou Lingying and her son Zhou Feng.
Jiang Jiemin, former CNPC head and another Zhou protégé, was questioned by the Central Commission for Discipline Inspection, the party’s anti-graft watchdog, in 2012 for paying to silence families of victims involved in a car crash in Beijing that claimed the life of the only son of Ling Jihua, the former top aide to former president Hu Jintao. Jiang was later expelled from the party and remains under investigation.
Millions of dollars illegally transferred from CNPC’s company account raised suspicions that Zhou’s camp has forged an alliance with Ling, who was a rising power in the party but now holds only a symbolic post after the deadly car crash involving a luxury Ferrari.
Zhou came under the scanner in May of 2012, when his ties with Bo Xilai landed him in trouble. Back then Communist Party members wrote to then president Hu Jintao asking for the dismissal of Zhou. They alleged that he was part of a movement to revive a Maoist movement in China.
The Implications Of Zhou's FallSomeone of Zhou's political stature hasn't been taken down in 30 years, Bill Bishop, author of Sinocism, told Business Insider.
It ends the notion that once you've made it to the PSC you have immunity, Bishop said.
Zhou's takedown, of course, fits nicely into Xi's move to consolidate power. "There is little doubt these people were engaged in remarkable amounts of corruption, and there are all sorts of unproven rumors about plots and deals among this group in the runup up to the 2012 18th Party Congress," Bishop said. "But taking down this network has also allowed Xi to gain control over the security services, and much faster than most observers expected.
"Given the interests affected by this corruption crackdown, it is vital for Xi to have under his control the elements of hard power that can keep grumbling and complaining about the campaign from spiraling into much more serious and viable resistance. My understanding is that by Q3 of 2013 he had successfully consolidated control over this system."
It isn't immediately clear what form of sentence Zhou might receive, but he is expected to be handed over to the judicial system next.
But this will send a clear message that no one, including officials in China's giant state owned enterprises (SOEs), is immune.
Bishop argues that this is bullish for the economy, because economic reforms can't be pushed through without reforms in the political sphere.
Xi does however face an interesting problem now. If he goes after too many former PSC members it will shake faith in the system.
"It's very embarrassing for the party," Bishop said.
But if he stops at just one, it could end up just looking like a power struggle.
This may only be the beginning of the story.
