Tea Leaf Nation

Nickled, Dimed, and Renminbi'ed

Does Chinese President Xi Jinping really make one-twentieth of Obama’s salary?

On March 5 at the National People's Congress, an annual meeting of China's legislature, Beijing announced it plans to spend $2.45 trillion in 2014. While it's unknown how much of that goes to salaries (the budget is broken down by industries), the amount for top officials is likely surprisingly low.

Based on available information, if Chinese President Xi Jinping were to decide to buy a 100-square-meter (about 1,080-square-foot) two-bedroom apartment in central Beijing, it would set him back almost $1 million at current prices. That means Xi, who by all appearances draws a nominal annual salary of about $20,000, would have to toil for 50 years as China's top leader to afford this modest property -- assuming, that is, that he and his family didn't pay for any other living expenses during that time. By contrast, if U.S. President Barack Obama were to do the same in the swankiest bits of Washington, D.C., he would have to pay about the same sum, but one amounting to a little over twice his annual salary of $400,000.

Of course, Xi would never need to worry about purchasing an apartment on his salary alone. He and his family live in the sprawling Zhongnanhai compound in the heart of Beijing. As a high-ranking official in China, his food, transport, and medical care are also covered by the state. And a Jan. 21 report by the International Consortium of Investigative Journalists shows Xi's relatives have held corporate entities offshore in the Cook Islands or British Virgin Islands. That's not illegal, but it's a move that the entities' owners often make to store or protect assets. Xi's family is not exactly hurting.

The salaries of China's top leaders are not public information, so details about them reaches the public in unintentional dribs and inferred drabs. In June 2011, while speaking to university students at a public event, Yu Zhengsheng, a member of China's ultra-powerful Politburo, made the rare disclosure that his basic salary was approximately $1,700 a month based on salary standards for Politburo members, and he claimed that he had to "pay for his own cigarettes" and "buy clothes at market prices." Since Xi is also a Politburo member, Yu's statement is a good baseline to gauge Xi's salary. In April 2013, state-owned weekly magazine China Newsweek reached a similar number through deduction, calculating that the basic salary for China's top leader was likely around $1,600 a month by examining the salary slips of ordinary civil servants and noting the incremental increase at each promotion.

If that's correct, and Xi had to survive in Beijing on his basic salary -- approximately twice the average salary of $850 per month in the city -- he would not only be unable to afford an apartment, but he'd have to scrimp just to make ends meet. A popular infographic that made the rounds in October 2013 on Sina Weibo, China's popular microblogging platform, calculates that someone living in Beijing on a salary just shy of Xi's would be left with savings of $50 each month after deducting reasonable expenses, including approximately $500 a month for rent and $250 a month for food.

On March 5, 2014, China's ambassador to the United States, Cui Tiankai, reportedly said at a public forum that newcomers filling slots in the foreign ministry -- one of the most coveted jobs for new graduates in China -- could not afford to rent an apartment in Beijing. But luckily for them, Chinese civil servants have long benefited from generous government subsidies to supplement their modest official incomes, and can sometimes count on gray income or even outright bribery. That's one reason that over the past 10 years, the number of young Chinese college graduates taking the civil service exam has surged from approximately 120,000 in 2003 to more than 1.5 million in 2013, roughly an elevenfold increase. As housing prices in China's major cities rose drastically in the first decade of the millennium, graduates and their parents began to favor the housing subsidies, retirement benefits, and other tangible perks that come with a civil servant position over nominally high salaries in the private sector that lack the same safety net. This preference has become controversial: Economist and Nobel laureate Edmund Phelps reportedly slammed the "frenzy" of competition for Chinese government posts as a "waste of talent."

The fever may now be cooling a little. As part of a crackdown on corruption, endemic in party ranks, Xi introduced the so-called "Eight Point Regulation" in December 2012 to rein in perks and gray income for civil servants. According to domestic media reports, junior civil servants were disproportionately affected, while their seniors largely carried on as before. The results of an anonymous survey of public servants by liberal outlet Beijing News, released Jan. 9, showed that 92 percent of participants reported that their "income from outside of work" had fallen over the past year. In 2014, wealthy Zhejiang province counted 25 percent fewer applicants to its civil service positions than in an analogous period the year before.

Top leaders like Xi will never have to worry about paying the bills, even as they spearhead crackdowns on nonessential perks. But civil servants in China, who likely make far less than the president, may want to start looking into more modest homes in Beijing's vast suburbs.

Lionel Bonaventure/Pool/Getty Images

Tea Leaf Nation

Zhou Decline Watch: Video of His Family Compound Released

Tracking the downfall of one of the most feared men in China.

The most important and confusing story in China right now concerns the probable downfall of Zhou Yongkang, formerly one of the most powerful men in China. The 71-year-old Zhou ran the state security apparatus as a member of the Politburo Standing Committee -- the top Communist Party body -- from 2007 to 2012, and now the ruling Chinese Communist Party, under General Secretary Xi Jinping, is almost certainly trying to bring him down. Reportedly under house arrest, Zhou hasn't been seen in public since October, and dozens of people, if not more, affiliated with him have been arrested.

As I wrote on Feb. 24, "Zhou's case -- if there is indeed a case against him -- is arguably the most important Chinese corruption investigation in decades, if not in the People's Republic of China's 65-year-history. Yet -- and here's the maddeningly opaque part -- we can only hypothesize about the what, when, why, and how of 'the case.' This murky struggle, playing out behind closed doors throughout China, is inaccessible to those outside China's elite."

Zhou may be publicly tried, or he may be allowed to wither away under house arrest. But as speculation grows that Zhou's day of reckoning is nigh, we at Foreign Policy thought regularly posting noteworthy hints of his decline as they appear would help contextualize the mystery surrounding Zhou's fate.

What: On March 4, Tencent News, owned by the Internet giant, published a video purportedly of the "Wuxi mansion of wealthy Beijing businessman Zhou Bin." The elder Zhou's only known son, Zhou Bin has been accused by Chinese media of shady business deals and is reportedly cooperating with the investigation against his father. The video, presumably shot by a drone, pans over a stately white compound in a rural Chinese village. The story doesn't mention Zhou Yongkang's name, though it links to an article that does.  

Why it Matters: Top Chinese officials live shrouded in privacy. Even fallen leaders enjoy a level of privacy for themselves and their families that prevents disgruntled Chinese from tracking them down. During the very public disgracing of former Chongqing Party Chief Bo Xilai in 2012 and 2013, state media was allowed to discuss many of the case's salacious details -- of murder, seduction, and betrayal. But they never published the location of the Chinese home of Bo or his family. The story accompanying the video describes, in great detail, the location of the house: "After driving for a little more than two kilometers, you will see a nearly 2 meters high, 1.5 meters wide brown stone" that marks the village, in which the Zhou compound "is very easy to find."