by Rob Schmitz
“That’s just awful,” I said.
“It’s not painful at all,” said Fu. “It feels nice and cool. It begins to take effect after just ten minutes!”
I looked at the other photos spread across the table. Brown, black, and yellow discharge covered an array of Heavenly Happiness pads. One photo of a pad covered in dried blood claimed to have been from a woman who had gone through menopause. She was now menstruating again, thanks to the wonders of Nurturing Lotus.
Mr. Clean put his hand on my shoulder. “Here,” he said, giving me a Heavenly Happiness package. “The restroom’s down the hall. Go put one inside your underwear.”
I reflexively crossed my legs. “Um…no, thanks,” I said.
Mr. Clean’s facial tic fired once more before turning into a frown. “I’ve used them for two months. They’re very comfortable. You won’t feel a thing.”
I shook my head.
“It’ll boost your sex drive!” Mr. Clean assured me, smiling. “You’re a journalist, right? You should try it so that you can report on it from your own personal experience.”
“I report on China’s economy, not on sexual health pads,” I said firmly.
“Then maybe you can report on my husband’s other company,” said Mr. Clean’s wife. “He’s the CEO of a helicopter business. In ten years, everyone will be riding around in helicopters! There’s an eighty percent chance of it getting launched,” she said confidently.
Mr. Clean nodded. I glanced over at him and imagined what his life must be like: one day recruiting people to sell underwear pads, the next day, selling shares of his commuter-helicopter scheme to poor people.
I looked around the table at the others—all of them were retirees like Fu. They spent their days in and out of investment meetings like this, trading secrets, championing their favorite merchandise, recruiting one another, receiving and delivering sales pitches for products that were too good to be true. One day they were predators, the next, prey; selling and buying from each other, spinning and spinning until hunter and the hunted had circled one another so many times they could no longer recognize which side they were on, only knowing they were all in this together, a human pyramid, bound by the force of guanxi.
I picked up a box of Heavenly Happiness and turned to Mr. Clean. “So how much do these cost?”
“Three hundred and ninety-eight renminbi for a box with twenty pads,” he replied.
I did the math. It was equal to $75, nearly $4 a pad. Uncle Feng would have to sell 150 scallion pancakes to afford a box.
“That sounds expensive,” I said.
“It’s a very good deal,” Mr. Clean said with a serious face. “And if you sell these, you’ll make a lot of money. Once someone tries it, they keep buying them.”
I looked at the photos spread across the table and tried to fathom why someone would keep buying a product that triggered uncontrollable discharge and made your underwear look like a soiled diaper.
Mr. Clean sensed my skepticism, and his face twitched. “Once you stop using these pads, you begin to feel very uncomfortable,” he said with a facial tic wink. “Before you know it, you feel like you can’t live without them, and you’ll always come back for more.”
He picked up a black dry erase marker. He began writing numbers on a whiteboard next to the television. It cost ¥4,000—around $700—for a membership that included fifteen boxes of pads. After I sold those, he said, I would get half off my second order. Once the discount kicked in, he said, I would have a ¥200 profit on each package of Heavenly Happiness I sold.
Auntie ran the numbers for me. “That’s a forty-five-percent profit!”
Mr. Clean nodded. “It’s that simple,” he said.
“What if I recruit other people to sell boxes of this?” I asked, playing along.
Mr. Clean’s face twitched with excitement. “And with your connections abroad, I’m sure you will!”
He turned to the board and scribbled more numbers. “If you find someone to help sell, you get a ‘first generation income,’ which is 25 percent of your friend’s sales. And let’s say he finds others to sell the pads, too. Then you’d get ‘second generation income’ of 15 percent, and it goes on to 10 percent of third generation, and then it’s 9.5 percent extending to the tenth generation. Just follow me here, and I’ll explain how it all works.”
Mr. Clean feverishly covered the whiteboard with dots and then turned to us. “You see this?” he asked.
We nodded.
“Now watch,” he said.
He turned around and drew lines connecting the dots, filling the board with small triangles, his face twitching more rapidly. He then connected all the triangles, and turned to us, out of breath. On the board, the shape was clear.
“This,” said Mr. Clean, “is a pyramid.”
I looked over at Auntie. She smiled at me, and motioned to the whiteboard.
Mr. Clean continued, pointing his marker at me. “Let me ask you something. Would you rather I give you one million renminbi after a month’s time, or I give you one renminbi the first day of the month and then multiply it by two each day after? Which would you choose?”
I played dumb. “I think I’d take the one million,” I said.
Auntie couldn’t contain herself and let out a snort of laughter.
“Okay,” laughed Mr. Clean. “You take that and I’ll take the one-renminbi option. Let’s see who made the right decision. The first day I get one yuan; the second day, two; the third day, four; the fourth day, sixteen…”
Mr. Clean scrawled the numbers furiously while the rest of the room chanted the calculations in unison. “Then 4,096! Then 8,192! Then 16,394! Then 32,768!”
By day 25, Auntie was slapping her knee excitedly as Mr. Clean again took over the chanting, his booming voice overpowering the room. “Then it’s over two hundred million! And on day thirty it’s over five hundred million! Wah! But you,” he said, pausing to take a breath, “only get one million. You see? That’s how our sales work!”
It was a neat multiplication game, but sales didn’t work that way, particularly sales of overpriced Chinese medicinal sexual health pads.
“How many people have you recruited?” I asked Mr. Clean.
His face twitched a little as he considered an answer. “Five or six,” he said.
“How long have you been selling these pads?” I asked.
“Three months,” he answered.
Auntie put her hand on my knee. “A friend of his from Wenzhou recruited him to sell these here in Shanghai!” she said.
Of course, I thought: a Wenzhou connection. “How much have you made?” I asked Mr. Clean.
“I’ve just started!” said Mr. Clean, forcing a smile. “Plus, I’m also preparing to start my helicopter company, so I’ve been busy with that.”
One of the women in the room stepped forward. She was in her eighties, and before the infomercial began, she told me she had made so much from investments like this that she could afford to send her granddaughter to a university in Australia. She put her hand on my shoulder, sensing the conversation had gotten off topic.
“Aiya! You journalists don’t make much money, right? How much do you make? Not a lot. Only businesspeople make a lot of money. Selling these pads could help you earn some extra income.”
Auntie nodded. “They’ll give you a trial box that you can share with your friends. If they like it, then come back and ask for more.”
“Bring this product back home to the United States,” urged the old woman.
“But I thought you said you’re already selling them in America,” I said.
“She’s just asking you to help promote the product there,” assured Auntie.
Mr. Clean stepped in. “We’ll help you connect with the company to discuss how to bring it to the American market.”
The old woman touched my hand. “It’s a good opportunity,” she told me, patting my arm. “We’re honest people. We would never cheat others.”
“157 SENIOR
S IN NINGBO Have Their Investment Dreams Smashed, Over RMB 12 Million in Pensions Poured Down the Drain.”
This headline was the first to appear on a Chinese search engine after I typed in “Liaoning Dingxu,” the name of the mushroom company into which Auntie Fu had poured much of her pension. “More than 100 Ningbo seniors are suspected to be mired in a Ponzi scheme,” began the article in the Southeastern Business Report of May 15, 2014.
The article claimed Liaoning Dingxu had drawn capital from all over China. Its target investors were Chinese in their seventies and eighties.
The city of Ningbo was just two hours south of Shanghai. I wondered if the perpetrators there were the same ones who had flown Auntie to the company’s mushroom farm and taken her fifteen thousand yuan.
The company’s CEO had been arrested along with two others at the Ningbo branch office. They were charged with stealing millions of dollars from 157 seniors, some who had invested their entire pensions into the company. The suspects had convinced the seniors they would earn an annual interest of 15 percent on their investments once the company was listed on NASDAQ.
Separate articles had reported the company was on the verge of bankruptcy. The Liaoning Evening News had discovered the greenhouses supposedly growing mushrooms—the same ones Fu had toured—were a façade, and had actually been rented out to local farmers who didn’t work for the company.
According to the article from Ningbo, the seniors who lost their pensions refused to believe they had been tricked. “Despite the fact that the case was nearing the sentencing period,” read the report, “several investors still wanted to discuss the U.S. listing with the defendants.”
The judge in the case was astonished. Prior to sentencing the defendants to prison, he took one last look at the conned investors assembled in his courtroom and asked them, incredulously: “Do you still believe the company will get listed?”
He then uttered a traditional Chinese saying, called a chengyu, from the bench—“Ku xiao bu de”—I don’t know whether to laugh or cry.
IT WAS IMPOSSIBLE to know how many people in China had fallen victim to investment scams. The government didn’t keep track of these sorts of things. Both companies Auntie Fu had bought shares in—Gatewang and Liaoning Dingxu—had promised listings on reputable stock exchanges in the West. At the time, several Chinese companies were listing on NASDAQ and the New York and London Stock Exchanges to great media fanfare.
When it came to pyramid schemes like Nurturing Lotus, China’s government had a little more experience. In 2014, China’s State Administration for Industry and Commerce allowed forty-nine companies to legally participate in direct sales, the selling and marketing of a company’s products between individuals instead of through fixed retail locations, as long as those companies and their army of laobaixing salespeople agreed to follow Chinese laws. The forty-nine included foreign ones like Amway, Avon, and Herbalife. Unsurprisingly, Nurturing Lotus didn’t make the official list and was therefore an illegal operation. But even for the companies on the list, there were problems. More than a few had been venturing into the recruitment and brainwashing techniques typical of pyramid schemes.
As one scholar who studied pyramid schemes in China put it, China’s Communist Party has always kept a close watch on these direct sales networks for good reason. “The growth of [these] grassroots networks is very similar in some ways to the Party’s own early organization and its early fervor. They harken back to the sects and cults that have traditionally thrived in the Chinese countryside, where the Party once found its most zealous supporters.”
That’s why I worried about Auntie Fu. She had grown up an uneducated peasant in the mountains of Sichuan. She was recruited by the Party to farm a desert in Xinjiang. Then she followed her husband across the country to the wilds of Shanghai, a place where money seemed to be everywhere besides her own pocketbook.
Like so many people of her generation, she didn’t know how to make money in this new China, so she gravitated toward what was familiar to her from the Mao years: a smiling recruiter promising a path to happiness and prosperity. And, just as a wide-eyed village girl was an ideal convert for Party recruiters in the 1960s, a poor elderly woman with little education and no access to the Internet was even easier prey for scam artists in twenty-first-century Shanghai.
THERE WERE NO DECORATIONS in Auntie Fu and Uncle Feng’s spartan room, save a poster of a Renaissance painting above their bed. The winged man in the painting appeared to be the Roman god Saturn. In one hand, he carried a nude woman and was poised to fly off with her. In the other, he gripped a sickle, using it to jab a man who was languishing on the ground.
“Why do you have that painting on the wall?” I asked the two.
I’d stopped by to have a heart-to-heart with Auntie about her investments after what I had found out about Liaoning Dingxu, but Uncle had been at home alone. When Auntie finally showed up, they started bickering. I needed a diversion.
“It’s from Germany,” Uncle said. “It’s an ancient painting. It’s depicting history. It’s about the feudal society.”
I wasn’t sure how he had come to this conclusion. Maybe it was the sickle the winged man was holding. Maybe it was the pastoral background. Auntie didn’t believe him, either.
“History? What do you know?” she said. “They’re not even dressed properly. How can you call that history? You’re talking like Chairman Mao! Feudal society! Class struggle! Aiya.”
“You don’t understand anything,” Uncle shot back. “You’re talking nonsense.”
“Mao was evil and cruel,” Auntie said to her husband.
“You can’t say he’s evil,” he said, glancing in my direction. “He was just following a different path.”
“He killed my father. He killed my uncle too, just because he graduated from a Kuomintang school. They were both innocent,” Auntie said. “Now all I’ve got left is one uncle who is barely surviving.”
“Then why don’t you go and visit him and share all that money you must be making from all those investments of yours!” shouted Uncle.
“I will when I’m through with this lawsuit,” she said.
“You and your stupid lawsuit!” Uncle shouted. “What the hell is the matter with you, filing a lawsuit! If it weren’t for me, you’d still be poor, toiling away in Xinjiang.”
“The air in Xinjiang is good!” Auntie screamed. “The food is safe. Everything’s cheaper! The climate is cool in the summer and warm in the winter. Where else can you find such a place where life is like heaven?” she asked.
“Then go back!” shouted Feng.
You just watch, old man, I thought to myself, she will. For Auntie Fu, Xinjiang represented a time in her life when she was happy, when life was simple. She didn’t live in a cold, dark hovel in Xinjiang, and she wasn’t in debt. There wasn’t a mistress in Xinjiang, and Auntie wasn’t driven by greed or revenge.
Auntie Fu pointed to Uncle’s back. “You want me gone so that you can do bad things while I’m away!”
She turned to me. “The only reason we’re in Shanghai is because of our children. The education system is better here, but everything else is better in Xinjiang.”
“Oh! It was for the children!” mocked Uncle. “How much money did you give the children? Did you buy a house for them? No! I’m the only one who helps them. All your money has been cheated away! You buy health products and other garbage and now you’re spending money on a lawsuit? What bullshit!”
I stood up to leave in the most polite way I knew.
“I’ve really got to go,” I stammered, looking at my phone. Auntie’s face was red with anger, her ears deaf to my departure notice. She grabbed my arm, stopping me. “Remember when I told you about how he forced me to come home to give birth in Shanghai? Remember that?”
I remembered. She had told me the story the day we met. We were in the middle of the underground church service; the rest of the congregation was singing a hymn. I had been struck by how her story—depa
rting Xinjiang to give birth in her husband’s ancestral home—was similar to the story of Mary and Joseph, leaving for Bethlehem to comply with the Roman census. Instead of giving birth in a manger, Auntie Fu had gone into labor on a bus in the middle of the desert and disembarked to give birth to her son at a run-down clinic. Afterward, she had suffered from complications of the birth and a doctor had introduced her to the teachings of Christ.
“Yes, I remember,” I said.
Auntie Fu wiped her eyes and took a breath. “That son died,” she said.
Uncle looked up from his television and glared at his wife.
She pointed to her husband. “His mother took our son to Anhui with her. One day he drowned in the river. He was studying to be a doctor at the Shanghai Medicine University. It was 1990. He had just turned eighteen. His mother brought him to Anhui, and he died in the river, just like that.”
I sat back down and braced for another fight, but the two fell silent, leaving the voices of the doctors on Uncle’s health program to fill the cold, dark room.
Three long minutes later, Auntie grabbed a bag of dried fruit from her cupboard, opened it, and offered me some. “Have an apricot,” she said with a soft smile.
I took one and looked at Uncle Feng. He stared into his television, listless. He didn’t say another word.
For much of Zhao Shiling’s adult life, the trip from her flower shop on the Street of Eternal Happiness to her hometown in Shandong province took 13 hours. Then, on the afternoon of July 1, 2011, a high-speed rail line appeared. What used to be a slow, bumpy overnight journey on a rickety sleeper bus suddenly became a 3-hour, 200-mile-per-hour jaunt on a bullet train gliding so smoothly above the rice paddies of the Yangtze Delta that you could stroll from the dining car back to your plush window seat without spilling a drop of your latte.
I took a sip and looked out the window at the Chinese countryside. It soared past so quickly it was difficult to focus on anything for more than a second or two. Before China built high-speed rail, a train ride was ideal for contemplation. I would often stare out an open window watching people work, and sometimes they would notice the foreigner and wave with a smile as the train crawled past. I would stick my head out, take a deep breath of country air, and wave back. I would think about the work they would have to do before the sun went down. I would think about their children who were studying at the village school, and I would imagine the life they led out here in the spaces in between. The sealed vestibule of a speeding bullet train offered no such opportunity for contemplation. You no longer breathed the same air as the villagers; there was no longer time to inspect a river gorge from the bridge above. These days, a train ride in China was spent engrossed in a movie on a tablet or checking email on your phone. If you were bored enough to have a look outside, the instant your eyes managed to focus on a farmer hoeing his field, he was gone.