Written on February 2, 2019, this essay describes how China’s ruling elite fights for enormous financial privileges.
Using the luxury hotel industry as an example, it explains the influence once held by Li Peng’s group and how the structure was attacked under Xi Jinping’s rule.
The article argues that the true nature of Chinese politics cannot be understood merely by reading mainstream Japanese newspapers or watching NHK.

February 2, 2019.
What kind of country China truly is cannot be clearly understood simply by subscribing to newspapers such as the Asahi Shimbun, Mainichi Shimbun, or Tokyo Shimbun and watching NHK.
I will republish a chapter I posted on March 9, 2018 titled “Because China’s ruling class controls enormous privileges and accumulates wealth from them, power struggles are essentially battles for those privileges.”
This is because it allows one to clearly understand realities about China that cannot be known merely by reading those newspapers or watching NHK.
The following continues from the previous chapter.
It is just like a yakuza turf war.
Udagawa.
In China, firearms also circulate on the black market.
There are many soldiers who lack moral discipline.
Xi Jinping has done many things within that environment that have earned him resentment.
For example, recently there was a report that in Chinese hotels dishes were washed using toilet-cleaning tools.
I believe that report was likely leaked by Chinese authorities on Xi Jinping’s side.
When obtaining permission to open a hotel in China, one must first submit an application to an intermediary before reporting to the authorities.
Until recently, Li Peng’s group handled that role.
When I was involved in opening the Swissôtel in China, I went to the Hong Kong–Macau Center under the China National Tourism Administration to obtain the intermediary’s approval.
There I nervously met Li Peng and received his approval.
After that I went to the State Council, which formally stands above that office, for an interview.
However they immediately granted permission, saying, “We have heard Mr. Li Peng has already approved it.”
I did not submit any of the building design plans that were originally supposed to be submitted to the State Council.
Kawazoe.
So Li Peng had long been the top figure controlling the privileges related to luxury hotels.
Udagawa.
That privilege structure has now been attacked.
According to what I heard from hotel officials on site, the three hotels mentioned in the reports were required to reapply for permits.
The intermediary role previously held by Li Peng was removed and replaced by Wang Huning, ranked fifth in the leadership hierarchy.
If they refuse to comply, the hotel will be forced to suspend operations.
Kawazoe.
Since China’s ruling class controls enormous privileges and accumulates wealth from them, power struggles are essentially battles to seize those privileges.
It is just like a yakuza turf war.
To be continued.