In the last days before the crash, the rush to build the railways added a final, lethal factor to the mix. In June, the government had staged the début of the most prominent line yet—Beijing to Shanghai—to coincide with the ninetieth anniversary of the Chinese Communist Party. A full year had been slashed from the construction schedule, and the first weeks of the run were marred by delays and power failures. According to a manager in the ministry, high-speed-rail staff were warned that further delays would affect the size of their bonuses. On the night of July 23, 2011, when trains began to stack up, dispatchers and maintenance staff raced to repair the faulty signal and ignored the simplest solution: stop the trains and regain the signal. Wang Mengshu, a scholar in the Chinese Academy of Engineering who was deputy chief of the committee investigating the crash, told me, “The maintenance people weren’t familiar enough with their jobs, and they didn’t want to stop the train. They didn’t dare.”

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When the crash occurred, Great Leap Liu was no longer running the Railway Ministry. In August, 2010, the National Audit Office reviewed the books of a big state-owned company and came upon a sixteen-million-dollar “commission” to an intermediary in return for contracts on the high-speed rail. The intermediary turned out to be a woman named Ding Shumiao, who, perhaps more than anyone else, embodied the runaway riches created by China’s railway boom. Ding was an illiterate egg farmer in rural Shanxi—five feet ten, with broad shoulders and a foghorn of a voice. In the nineteen-eighties, after Deng Xiaoping launched the country toward the free market, she collected eggs from neighbors to sell in the county seat. That was illegal without a permit. The eggs were confiscated, and years later she still talked of her embarrassment. In time, she came to run a small, thriving restaurant, where she gave away food to powerful customers and exaggerated her own success. “If she has one yuan, she’ll say she has ten,” one of Ding’s longtime colleagues told me. “It makes her look more influential, and bit by bit people began to think that they could benefit from their friendship with her.”

Ding’s restaurant became a favorite with coal bosses and officials, and soon she was involved in coal trucking. Then she was “flipping carriages,” as it’s known in the railway business: working her connections to get cheap access to coveted freight routes and, according to Wang, the investigator, reselling the rights “for ten times what she paid.” She became friendly with Great Leap Liu around 2003, and, with her ties to the railway business, she prospered. Her company, Broad Union, signed joint ventures and supplied the ministry with train wheels, sound barriers, and more. In two years, Broad Union’s assets grew tenfold, to the equivalent of six hundred and eighty million dollars in 2010, according to China’s Xinhua news service.

Ding’s given name, Shumiao, betrayed her rural roots, so she changed it to Yuxin, at the suggestion of her feng-shui adviser. She was easy to lampoon—Daft Mrs. Ding, people called her—but she had a genius for cultivating business relationships. A longtime colleague told me, “When I tried to teach her how to analyze the market, how to run the company, she said, ‘I don’t need to understand this.’ ” Caixin chronicled her audacious social ascent. To gain foreign contacts, she backed a club “for international diplomats,” which managed to attract a visit in 2010 by Britain’s former Prime Minister Tony Blair. Her lavish receptions drew members of the Politburo. She joined the lower house of the provincial legislature, and made so many charitable gifts that in 2010 she ranked No. 6 on the Forbes China list of philanthropists.

Ding was detained in January, 2011, suspected of taking kickbacks totalling sixty-seven million dollars, according to the Global Times. (The ministry also accused her of working her connections to get Liu’s brother transferred from jail to a hospital.)

Like many others, Ding knew something that government auditors uncovered only later: China’s most famous public-works project was an ecosystem almost perfectly hospitable to corruption—opaque, unsupervised, and overflowing with cash, especially after the government announced a stimulus to mitigate the effects of the 2008 global financial crisis. It boosted funding for railway projects to more than a hundred billion dollars in 2010. In some cases, the bidding period was truncated from five days to thirteen hours. In others, the bids were mere theatre, because construction had already begun. Cash was known to vanish: in one instance, seventy-eight million dollars that had been set aside to compensate people whose homes had been demolished to make way for railroad tracks disappeared. Middlemen expected cuts of between one and six per cent. “If a project is four and a half billion, the middleman is taking home two hundred million,” Wang said. “And, of course, nobody says a word.”

One of the most common rackets was illegal subcontracting. A single contract could be divvied up and sold for kickbacks, then sold again and again, until it reached the bottom of a food chain of labor, where the workers were cheap and unskilled. (The practice is hardly unique to the railways: in 2010, a rookie welder employed by an illegal subcontractor was working on a dormitory in Shanghai when he dropped his torch and set the building on fire; fifty-eight people died.) In November, 2011, a former cook with no engineering experience was found to be building a high-speed railway bridge using a crew of unskilled migrant laborers who substituted crushed stones for cement in the foundation. In railway circles, the practice of substituting cheap materials for real ones was common enough to rate its own expression: touliang huanzhu—robbing the beams to put in the pillars.

With so many kickbacks changing hands, it isn’t surprising that parts of the railway went wildly over budget. A station in Guangzhou slated to be built for three hundred and sixteen million dollars ended up costing seven times that. The ministry was so large that bureaucrats would create fictional departments and run up expenses for them. Procurement was a prime opportunity for graft. The ministry spent nearly three million dollars on a five-minute promotional video that went largely unseen. The video led investigators to the ministry’s deputy propaganda chief, a woman whose home contained a million and a half dollars in cash and the deeds to nine houses; her husband, who also worked for the ministry, was found to have a collection of gift cards—a discreet alternative to cash bribes. Other government agencies also had serious financial problems—out of fifty, auditors found problems with forty-nine—but the scale of plunder in the railway world was in a class by itself. Liao Ran, an Asia specialist at Transparency International, told the International Herald Tribune that China’s high-speed railway was shaping up to be “the biggest single financial scandal not just in China, but perhaps in the world.”

In most countries, the effects of kleptocracy are easy to predict: economists have calculated that for every point that a nation’s corruption rises on a scale of one to ten, its economic growth drops by one per cent. (Think Haiti under François Duvalier or Zaire under Mobutu.) But the exceptions are important. In Japan and Korea, corruption accompanied the nation’s rise, not its collapse. There is no more conspicuous case than the United States. When promoters of the first transcontinental railroad were found to have secretly paid themselves to build it—the 1872 scandal known as Credit Mobilier—the scale of plunder was described by the press as “the most damaging exhibition of official and private villainy and corruption ever laid bare to the gaze of the world.” Between 1866 and 1873, the country put down thirty-five thousand miles of track, minting enormous fortunes but also, as Mark Twain put it, displaying “shameful corruption.” (Twain’s novel “The Gilded Age,” written with Charles Dudley Warner, gave the era its name.) The excesses of the railroad boom led to the Panic of 1873 and subsequent financial crises, before political pressure to curb abuses gained momentum during the Progressive Era.

In China, as in the United States, corruption and growth flourished together. In the nineteen-eighties, a carton of Double Happiness cigarettes was enough to secure a job transfer or the ration coupon for a washing machine. But in 1992 China began to free up the distribution of land and factories for private use, and the corruption boom was under way. According to the sinologist Andrew Wedeman, in a single year the average sum recovered in corruption cases more than tripled, to six thousand dollars. Cartons of Double Happiness gave way to Hermès bags, sports cars, and tuition for children studying abroad. The larger the deal, the higher the cadre needed to approve it, and bribes moved straight up the ranks.

A writer I know named Hu Gang, a small, meticulous man of fifty, happened to be one of those doing the bribing. He was running an auction house, a business in which a single signature from a judge bestows the right to auction off buildings, land, and other assets and collect a hefty commission. Everyone seemed to be in on the take, Hu said. “So, I began to think, If they can do it, why can’t I?” Hu was a natural; he bribed judges—first with cigarettes, then banquets, then trips to massage parlors. He followed certain rules of his own: never bribe a stranger; time cash gifts for the fall, when tuition bills come around. Before long, he was juggling relationships with so many judges that he had to make three trips to the massage parlor in a single day. After five years, he had a nest egg worth a million and a half dollars. Then he was picked up in a routine crackdown and served a year in jail.

Officials and businessmen looked out for each other by organizing themselves into “protective umbrellas,” a step in what Chinese scholars have termed the “mafiazation” of the state. By 2007, the China scholar Minxin Pei found that nearly half of all Chinese provinces had sent their chief of transportation to jail for corruption. It was costing China three per cent of its gross domestic product; that would be two hundred billion dollars today—more than the national budget for education. Since then, the opportunities to steal have only diversified. This summer, the Modern Chinese Dictionary, the national authority on language, added a new word: maiguan, “to buy a government promotion.”

Today, the scale of temptation for members of China’s government is unlike anything encountered in the West. According to Bloomberg News, the richest seventy members of China’s national legislature gained more wealth in one year—2011—than the combined net worth of the United States President, his Cabinet, all the members of Congress, and the Justices of the Supreme Court. Bloomberg went a step further, and reported, in June, that the extended family of China’s incoming President, Xi Jinping, has tens of millions of dollars in real-estate and financial assets. The government has since blocked the Bloomberg Web site.

There are two basic views of how corruption will affect China’s future. The optimistic scenario is that it is part of the ambitious transition from Socialism to a free market, with highways and trains that inspire envy even in the developed world. In July, the U.S. Transportation Secretary, Ray LaHood, told a reporter, “The Chinese are more successful because in their country only three people make the decision. In our country, three thousand people do.”

The other view holds that the compact between the people and their leaders is fraying, that the ruling class is scrambling to get what it can in the final years of frenzied growth, and that the Party will be no more capable of reforming itself from within than the Soviets were. Last year, the central bank accidentally posted an internal report estimating that, since 1990, eighteen thousand corrupt officials have fled the country, having stolen a hundred and twenty billion dollars—a sum large enough to buy Disney or Amazon. The government has vowed that officials will forgo luxury cigarettes and shark’s-fin soup, but vigilant Chinese bloggers continue to post photographs of cadres wearing luxury watches and police departments with Maseratis and Porsches painted blue and white. Even Wen Jiabao, the Prime Minister, who will leave the Politburo next month, declared that corruption was “the biggest danger facing the ruling party”—a threat that, left unchecked, could “terminate the political regime.”

In February, 2011, five months before the train crash, the Party finally moved on Liu Zhijun. According to Wang Mengshu, investigators concluded that Liu was preparing to use his illegal gains to bribe his way onto the Party Central Committee and, eventually, the Politburo. “He told Ding Shumiao, ‘Set aside four hundred million for me. I’m going to need to spread some money around,’ ” Wang told me. Four hundred million yuan is about sixty-four million dollars. Liu actually managed to pull out nearly thirteen million, Wang said. “The central government was worried that if he really succeeded in giving out four hundred million in bribes he would essentially have bought a government position. That’s why he was arrested.”

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Liu was expelled from the Party the following May, for “severe violations of discipline” and “primary leadership responsibilities for the serious corruption problem within the railway system.” An account in the state press alleged that Liu took a four-per-cent kickback on railway deals; another said he netted a hundred and fifty-two million dollars in bribes. He was the highest-ranking official to be arrested for corruption in five years. But it was Liu’s private life that caught people by surprise. The ministry accused him of “sexual misconduct,” and the Hong Kong newspaper Ming Pao reported that he had eighteen mistresses. His friend Ding was said to have helped him line up actresses from a television show in which she invested. Chinese officials are routinely discovered in multiple sins of the flesh, prompting President Hu Jintao to give a speech a few years ago warning comrades against the “many temptations of power, wealth, and beautiful women.” But the image of a gallivanting Great Leap Liu, and the sheer logistics of keeping eighteen mistresses, made him into a punch line. When I asked Liu’s colleague if the mistress story was true, he replied, “What is your definition of a mistress?”

By the time Liu was deposed, at least eight other senior officials had been removed and placed under investigation, including Zhang, Liu’s bombastic aide. Local media reported that Zhang, on an annual salary of less than five thousand dollars, acquired a luxury home near Los Angeles, stirring speculation that he had been preparing to join the exodus of officials who take their fortunes abroad. (In recent years, corrupt cadres who send their families overseas have become known in Chinese as “naked officials.”)

In the months that I spent talking to people about the rise and fall of Liu Zhijun, his story seemed to confound both his enemies and his friends. His rivals acknowledged that, unlike many corrupt officials, Liu had actually achieved something in office, and produced a railway system that, if the problems can be repaired, will ultimately benefit the nation. And his defenders found themselves awkwardly saying that he was doing nothing that his peers were not. Liu’s colleague, an affable former military man, told me that at a certain point corruption became difficult for Liu to avoid: “Inside the system today, if you don’t take bribes you have to get out. There’s no way you can stay. If three of us are in one department, and you are the only one who doesn’t take a bribe, are the two of us ever going to feel safe?”

Not long ago, I met a subcontractor for the railway, and I asked if things had been cleaned up since Liu’s downfall. He let out a humorless laugh. “They made a show of it, but it’s still the same rules,” he said. “They caught Ding Shumiao, but she’s just one person. There are many, many Ding Shumiaos.” Li Xue, as I’ll call him, is fifty-four, with a growl of a voice and a face weathered by life outdoors, but he was funny and relaxed when we met, and I liked him immediately. He’d spent his career blasting railroad tunnels—assembling crews, punching holes through mountains, and then moving on to the next job. He is a grandfather now, and proud of all that the country has built in his lifetime: “America always criticizes us for human rights,” he said. “It’s our weakness. But construction is our strength. We put people together fast. The bosses don’t have to listen to anybody but themselves.”

One weekend, Li invited me out to his latest job, in the rocky hills of Hebei Province, a few hours’ drive from Beijing. Over lunch, he talked wistfully about what he called a “golden age” a few years ago, when costs were lower and officials didn’t know how much they could earn on the side. “The bribes we pay now keep growing,” he said. “We’re the ones who get squeezed.”

We got into his black Audi sedan and climbed a road up into the hills, where we turned onto a rutted muddy track lined with cornfields and brick farmhouses. I asked if he enjoyed the wining and dining that comes with building tunnels. He shook his head. “It’s exhausting,” he said, and explained the taxonomy of bribes. “There’s the head of the department, and then the managers and the ones who run the warehouses. You’ve got to take care of them just like praying to the Buddha—you don’t pray, you run into trouble.” The hardest days were groundbreakings, when everyone who showed up expected a cut. “It costs us a fortune,” he said. Recently, he had turned over the entertainment duties to a younger colleague. “He really excels at it,” he said.

We reached a plateau, with excavators and bulldozers, and parked outside a tunnel into the hillside. Li introduced me to the explosives chief, a thin man in his twenties, with a coxcomb of spiky hair. I asked where he’d learned his trade. “Self-taught,” he said.

Li spat into the mud and handed me a hard hat. Inside, the tunnel was cool and dark, about thirty feet high, with a smooth ceiling, faintly lit by work lights along the edges. Li had dug ten tunnels in his life, and this would be the longest—two miles end to end.

After a while, we reached a group of eight workers in cotton shoes, hard hats, and military-surplus uniforms. They were wrestling a heavy iron frame into a side door in the tunnel. They groaned and heaved and slipped in the mud, in a scene illuminated by a single light bulb. It could have been 1912, instead of 2012. Li said that ten days earlier he had run into a problem: he hadn’t been paid by the subcontractor overseeing the tunnel, and now he had to lay off workers and stop digging. The Railway Ministry wasn’t as flush as it once was, and less money was trickling down to him.