Nominal: Starting with an entrance exam for a PhD in Economics at Peking University

Knowing this wasn't the time to hide his abilities, Qi Tongwei pondered for a moment and then said, "I don't know much about those large state-owned enterprises that are vital to the national economy and people's livelihood. But I studied in Handong for six years, and one of my university classmates was from the Jingzhou Canned Food Factory; both his parents worked. In the early 1990s, when the reform of state-owned enterprises had just begun, the person in charge of the reform was Zhao Lichun, the mayor of Jingzhou—I heard he was about to take over as the municipal party secretary. His reform methods were quite radical..."

He described some phenomena that occurred in certain places at the time under the "grasp the big and let go of the small" policy, such as simply pursuing the speed of reform and lax review of asset appraisals. "At that time, it seemed that as long as 'privatization' was completed, it was a political achievement. The factory director, through various manipulations, reported a factory that was originally doing well as one that was seriously losing money, and ultimately achieved a management buyout. At the time, many workers reported him for embezzling state-owned assets, but due to a lack of solid evidence, the matter was eventually dropped. Strangely, after privatization, it was still the same factory, the equipment and products were not much different, except for a significant drop in workers' wages and benefits, nothing else seemed to have changed, but the financial statements suddenly showed a 'profit.' When asked, they said it was entirely because 'the market economy is better than the planned economy,' but I have reservations about this."

Li Yiqing listened attentively, nodding occasionally, and then asked, "So, do you hold a negative attitude towards the reform of state-owned enterprises themselves?"

“Not entirely,” Qi Tongwei clearly stated his views. “I belong to the ‘conservative’ faction that supports reform but advocates caution. On the one hand, I believe that reform requires meticulous operation to avoid ‘one-size-fits-all’ approaches, and in particular, to prevent the loss of high-quality state-owned assets during the restructuring process. On the other hand, I believe that state-owned enterprises that are related to basic livelihood security and public services, even if they are temporarily losing money, have a social value that determines that they cannot be easily privatized.”

He recalled the chaotic situation that occurred in a city in later years after all hospitals were privatized, forcing locals to seek medical treatment elsewhere, which further proved this point.

Li Yiqing said, "These are all unavoidable growing pains in the process of reform. As the old saying goes, 'To correct a wrong, one must go to extremes.' If the support for reform is not strong enough, the resistance will be greater, and the effect may not be significant. From the perspective of laid-off workers, you see injustice and loss; but from the overall perspective of the country's economic transformation, these reforms have indeed revitalized existing assets to a large extent and injected new vitality into the national economy."

Qi Tongwei sighed, “A speck of dust in the era, falling on an individual, becomes a mountain.” He had heard this in his previous life and felt a deep resonance with it, so he couldn’t help but say it now.

Unexpectedly, Li Yiqing's expression turned serious: "Tongwei, you must be wary and not fall into the trap of the isolationism or individualism advocated by the West. They promote the idea that individual rights are absolutely superior to public rights everywhere. The Soviet Union, to some extent, was influenced by this kind of ideology."

Being deeply poisoned by this ideology will artificially separate and antagonize the individual from the nation, which is a shared destiny. This is extremely dangerous.

He further explained: "Take the textile factory example you just mentioned. There may be unfairness in individual cases, but most state-owned enterprises at that time had indeed reached the point where reform was imperative. Relying entirely on government funding to maintain operations had become a heavy burden. Where did the government's money come from? Ultimately, it came from the wealth created by all the people. This was equivalent to using everyone's money to support a portion of inefficient enterprises."

"If we only consider the immediate interests of some workers and maintain the status quo, where will the investment in key national infrastructure construction, scientific and technological innovation, and national defense modernization—investments that are crucial to long-term development and overall interests—come from? Shouldn't we create conditions for the development of the next generation?"

“Look at some South American countries, blindly imitating electoral politics. Politicians, in order to win short-term votes, abuse welfare and mortgage the future, ultimately making a mess of the economy.”

"Our country possesses a policy continuity and a stable governance system that are rare in the world. We are willing to bear temporary misunderstandings or even criticism for the sake of long-term interests, which is very commendable. It is understandable that ordinary people cannot see the big picture at the moment. But as a future economist—who may very well enter politics in the future, there is nothing you cannot say—you must have a vision that transcends the individual and the local, and see the whole picture and the long term."

Qi Tongwei lowered his head in sincere admiration: "Thank you for your guidance, teacher. I understand now."

Li Yiqing nodded in satisfaction and explained the upcoming arrangements: "Next year, I need to submit a special report on the reform of state-owned enterprises, and I plan to conduct on-site research at several enterprises that are undergoing restructuring. The State Economic Commission has provided several candidate enterprises, and originally we planned to go to one in Shanghai. Now, I've changed my mind." He looked at Qi Tongwei, "There's also one in your Handong on the candidate list, so let's go to Jingzhou to take a look. Go and make preparations, we'll leave this afternoon."

"Once the research is over, you can go straight home for the Chinese New Year, saving you the travel expenses," he added with a touch of humor.

"A company from Handong?" Qi Tongwei was somewhat surprised.

"You should have heard of the No. 1 State-owned Textile Factory in Handong Province. Its director is Cai Dafeng."

Dafeng Factory?!

Chapter 25 Return to Jingzhou

Qi Tongwei truly hadn't expected that he would have to return to Jingzhou less than half a month after leaving. He had tried his best to avoid Jingzhou and the troublesome place of Handong, but he always returned for various reasons.

It was as if an invisible hand was secretly manipulating the trajectory of fate.

The No. 1 State-owned Textile Factory of Handong Province, which later became the Dafeng Factory, the center of the turmoil, was one of the main battlegrounds for the power struggle between him, Zhao Ruilong, and Hou Liangping and Sha Ruijin.

He thought he would never cross paths with this place again in his life, but unexpectedly, he returned here so soon, and in the capacity of "state-owned enterprise reform researcher (temporary)".

Professor Li Yiqing specially applied for this title for him, so that he could be affiliated with the research group and receive a stipend.

As the train sped along, Jiang Fan looked at Qi Tongwei, who seemed lost in thought, and teased him with a smile, "What, do you have a deep connection with this First Textile Factory?"

Qi Tongwei naturally couldn't reveal his true thoughts, so he replied, "One of my junior brothers' childhood friends is the son of Cai Dafeng, the director of the First Textile Factory."

Jiang Fan had only asked casually, but upon hearing this, he immediately became interested: "Oh? What's this person like? Have you met his father?"

At this time, Qi Tongwei did not know Cai Chenggong. He cleverly quoted a classical allusion: "History books teach us that 'the vassal of my vassal is not my vassal.' Similarly, the friend of my friend may not be my friend."

"Then why are you bringing this up?"

“I’ll bring up this relationship later,” Qi Tongwei explained. “If they’re interested, they’ll naturally bring my junior brother to me. By observing their attitude, we can usually glean some clues.”

Professor Li Yiqing, who had been resting with his eyes closed, opened them and said, "This is not a bad method. Jiang Fan, you should learn more from Tongwei in handling interpersonal relationships."

Jiang Fan nodded in agreement, then turned to Qi Tongwei and exclaimed, "Junior brother, how did you come to this? You're five or six years younger than me, but you're much more mature than me."

Qi Tongwei smiled and said, "It's good for people to get experience at the grassroots level. Senior Brother Jiang, why don't you also find an opportunity to go down to the grassroots and hone your skills?"

Jiang Fan waved his hands repeatedly and laughed, "No need, no need. I plan to spend my whole life with Peking University and not go anywhere else."

This research trip was scheduled close to the winter break and was a last-minute decision, so only the three of them—the professor, his student, and himself—traveled lightly. Professor Li also had some doctoral students recommended and trained by ministries who were not on leave for their studies and rarely came; other students were busy with their dissertations and were unable to join the trip.

The train arrived at Jingzhou Station. As soon as I stepped off the platform, I saw a prominent sign that read, "Welcome Professor Li Yiqing for an inspection tour." Professor Li's trip was not an unannounced visit; he was not a disciplinary official, nor did he need to. His itinerary had already been arranged through the State Economic Commission and the Handong Province authorities.

The flow of people exiting the station was dense. Qi Tongwei and Jiang Fan flanked Professor Li Yiqing, moving towards the sign. Upon closer inspection, they discovered a familiar face standing beneath the sign.

"Teacher Gao, what are you doing here?" Qi Tongwei asked, somewhat surprised.

The visitor was Gao Yuliang.

Qi Tongwei quickly introduced Professor Li Yiqing: "Professor, this is Professor Gao Yuliang, the head of the Department of Political Science and Law at Handong University, and also my master's supervisor." He then introduced Li Yiqing and Jiang Fan to Gao Yuliang.

Gao Yuliang quickly stepped forward and warmly shook hands with Li Yiqing and Jiang Fan, repeatedly saying, "I've heard so much about you." After exchanging pleasantries, he turned to Li Yiqing and introduced his companions: "Professor Li, this is Wan Qingfeng, Deputy Director of the Economic Commission of Handong Province; this is Professor Fu Simiao of the Department of Economics at Handong University; and this is Ms. Chu Qin, an officer from the Provincial Economic Commission. Ms. Chu will be mainly responsible for coordinating specific matters with you all from now on."

Chu Qin is a woman in her early thirties, with a capable and poised demeanor.

After a brief exchange of pleasantries, everyone boarded vehicles arranged by the Provincial Economic Commission and headed to the guesthouse. A welcoming banquet had already been prepared. Professor Li did not drink alcohol, but thanks to the well-timed guidance and encouragement from Deputy Director Wan and Gao Yuliang, the atmosphere at the banquet was harmonious, and both hosts and guests enjoyed themselves.

After the banquet, Li Yiqing returned to his room to rest, and Qi Tongwei saw Gao Yuliang off from the guesthouse.

Walking along the tree-lined path outside the guesthouse, Gao Yuliang said earnestly to Qi Tongwei, "Tongwei, I'm mainly here to keep you company and fulfill my duty as a host. Professor Li Yiqing is a leading figure in the field of economics, with profound knowledge. I had a brief conversation with him at the dinner table and felt that I benefited greatly from it."

"It is a tremendous opportunity for you to become his student. You must cherish it, study diligently, and humbly seek his guidance."

Qi Tongwei respectfully replied, "I understand, and I will definitely follow Professor Li to do my studies diligently."

After seeing Gao Yuliang off, Qi Tongwei returned to the hotel. He had just returned to his room when Jiang Fan told him that Professor Li had left a message asking him to come over.

Entering Professor Li's room, one could see the professor with a slight frown. He cut to the chase, saying, "I had heard you mention this Professor Gao before, and I thought he was a kind and insightful academic colleague. But meeting him today, I find that he is indeed 'not as good as he sounds.'" Li Yiqing, nearly seventy years old, is a senior professor at Peking University and a member of the Chinese Academy of Social Sciences. He usually associates with high-level leaders and top scholars, and he was quite frank in commenting on Qi Tongwei's teacher.

"He does have a solid academic foundation," Professor Li commented objectively, "but judging from his conversation, he seems unfamiliar with some of the latest academic developments in the field of political science and law that even I am aware of. If this continues, he may really become a so-called 'administrative scholar'."

Qi Tongwei added softly, "Professor Gao... does indeed have the intention to transition into politics."

“No wonder,” Li Yiqing said with a hint of regret, “his words revealed a slightly eagerness for personal gain, but he hadn’t completely lost the aloofness of the old-style intellectuals. In this state, his future in politics would be uncertain.”

Qi Tongwei recalled Gao Yuliang's fate in his previous life and sighed inwardly. Professor Li's insight was indeed sharp; his words had almost come true.

"Alright, Tongwei, you should go back and get some rest too." Li Yiqing ended the topic. "Tomorrow we'll get up early and go to the Handong Provincial Economic Commission to review the relevant files of the First Textile Factory so we have a clear understanding before going to the factory for research."

"Okay, teacher." Qi Tongwei nodded in agreement and left the room.

Back in his room, Qi Tongwei quickly washed up and lay down on the guesthouse bed. His roommate, Jiang Fan, was already asleep, his breathing even. Outside the window, the night in Jingzhou was deep, with only the occasional distant car headlights piercing the darkness.

The day's events replayed in his mind. Professor Li Yiqing's insightful eyes, the profound scholarship and keen judgment displayed in his speech, and the composure he exuded in his interactions with others all deeply impressed him. He was not merely a scholar who devoted his life to studying in his study, but a wise man capable of applying his knowledge to practical matters and influencing national policy.

He recalled Professor Li's incisive evaluation of Gao Yuliang, his penetrating analysis of state-owned enterprise reform, and his authoritative yet gentle demeanor as a teacher. To spend so much time with such a mentor, and to harbor the shallow thoughts of merely obtaining a degree or expanding one's network, would not only be a waste of this rare opportunity but also a betrayal of oneself.

As he pondered, weariness gradually crept in, and he peacefully drifted off to sleep.

I'll be busy tomorrow too.

Chapter 26 The Current Situation of the Textile Factory

That night, while Qi Tongwei was soundly asleep in the Jingzhou Guesthouse, many corners of Handong Province remained brightly lit, with undercurrents stirring beneath the surface.

It was nearly midnight when Cai Dafeng, the director of the Handong State-owned First Textile Factory, finally dragged his weary body out of the Jingzhou Municipal Government building. He rubbed his throbbing temples and got into the factory's black Santana—the standard vehicle for state-owned enterprise leaders in this era.

His son, Cai Chenggong, the deputy head of the factory's sales department, was in the driver's seat. It wasn't that Cai Dafeng didn't have a personal driver, but at this sensitive time, his own son was clearly more trustworthy.

Cai Chenggong glanced at his father's bloodshot eyes through the rearview mirror and asked in a low voice, "Dad, are we going home?"

Cai Dafeng rubbed his face vigorously, forcing himself to stay alert: "No, I'll go to the factory."

Cai Chenggong started the engine, turned the car around, and drove towards the textile factory. The wheels rolled over the empty streets, making a monotonous sound.

"Dad, what did Mayor Zhao say?" Cai Chenggong couldn't help but ask.

Cai Dafeng sighed deeply, his voice revealing undisguised anxiety: "This expert from Beijing is someone who can reach the highest levels of government. If we don't handle this investigation well, the city may directly halt our restructuring plan."

Cai Chenggong's hand trembled, and the car almost scraped the curb.

"Drive properly!" Cai Dafeng scolded.

Cai Chenggong quickly gripped the steering wheel and asked unwillingly, "Can't the city think of a solution? We've sent so much money, and you've supported so many people in Jingzhou all these years, just to deal with situations like this."

“Success, you need to distinguish the hierarchy in relationships.” Cai Dafeng leaned back in his chair, closing his eyes to rest. “Your sales manager comes to my house with gifts every holiday. Can you say he’s supporting me? You young people like to watch Hong Kong movies, where vendors have to pay protection money to thugs. It’s pretty much the same for me. The money I pay is just to buy peace of mind, to keep them from causing trouble. If something really bad happens, you can’t rely on these people.”

Cai Chenggong, young and hot-blooded, slammed his fist on the steering wheel upon hearing this and cursed angrily.

Cai Dafeng ignored his son's powerless rage and continued to rest with his eyes closed. The textile factory was not far from the municipal government, less than twenty minutes away.

Upon entering the office building, Cai Dafeng immediately instructed Cai Chenggong to notify all factory leaders to attend a meeting in the conference room. The office lights remained on until 3 a.m.

......

The next morning, Chu Qin, an official from the Provincial Economic Commission, arrived at the guesthouse on time. After having breakfast with Li Yiqing and his party, they went to the Provincial Economic Commission to review documents.

In the archives of the Economic Commission, all the documents of the Handong State-owned No. 1 Textile Factory were neatly arranged on the table: including financial statements, balance sheets, profit and loss statements, cash flow statements, employee rosters and wage payment records for the past five years, raw material purchase lists, product sales ledgers, inventory details, equipment lists and depreciation information, as well as meeting minutes of discussions on various restructurings.

The information is so comprehensive that it can almost always meet any request.

Professor Li Yiqing's trip was facilitated by his connections with the State Economic Commission, representing the will of a higher level. Therefore, Han Dongfang almost always complied with their requests.

This is not to say that subordinates would not deceive their superiors, but clearly, in this matter, the Handong Economic Commission regarded it as a window to demonstrate its work results to higher authorities and was exceptionally cooperative.

Qi Tongwei carefully examined the neatly bound documents, which appeared almost flawless on the surface. Although the Economic Commission had generously provided all the materials, they stipulated that they could only be viewed in the archives and were not allowed to be taken away or copied.

In this respect, Qi Tongwei was far less experienced than Jiang Fan. Jiang Fan methodically categorized and organized the materials, marked key points with sticky notes, and frequently jotted down crucial data in his notebook. Qi Tongwei could only assist by searching for and delivering documents.

Professor Li Yiqing only glanced at the main reports before abandoning them and began chatting with the leaders of the Economic Commission. They talked about everything under the sun, from macroeconomics to local customs, seemingly taking the research trip lightly. Only when Jiang Fan compiled the summary would he come over and give it a quick look.

As noon approached, with less than a fifth of the data sorted out, Li Yiqing waved his hand and said, "Let's go eat first, and then we'll go to the textile factory this afternoon."

When no one was looking, Qi Tongwei asked in a low voice, "Teacher, we haven't finished reading the materials yet, should we stop now?"

Li Yiqing smiled slightly and lowered his voice: "The more a file is hidden, the more problems it exposes. On the contrary, files that are shown to you openly like this have already been dealt with, even if there were problems. Instead of wasting time here, we should go to the site and see the actual situation."

......

In the afternoon, the group arrived at the Handong State-owned First Textile Factory, which later became known as Dafeng Factory.

As the convoy entered the factory gate, they saw a group of factory leaders, led by Cai Dafeng, already lined up and waiting. Cai Dafeng, in his early fifties, was slightly overweight and wore a slightly oversized gray suit. He had a warm smile on his face, but the wrinkles at the corners of his eyes betrayed his weariness. Standing beside him was his son, Cai Chenggong, a young man in his twenties wearing a fashionable leather jacket, his eyes bright but also showing a hint of restlessness.

The welcoming ceremony was quite grand, with red banners hanging on the main road of the factory area, and workers dressed in neat work clothes standing on both sides, applauding and welcoming the workers.

At the subsequent symposium, Cai Chenggong, on behalf of the factory, gave a detailed report on the difficulties faced by the textile factory: accumulated debts of up to six million yuan, five months of unpaid wages to employees, serious backlog of products in the warehouse, and a continuous shrinking market share... A series of data all pointed to the same issue - reform was imperative.

After listening patiently, Li Yiqing asked, "If the privatization reform is completed, how do you plan to lead the textile factory out of its predicament?"

Cai Dafeng, clearly prepared, confidently replied, "We plan to utilize our existing factory buildings and equipment to transform and build a garment processing plant. On the one hand, we can imitate popular styles from coastal areas to quickly open up the market; on the other hand, we can take on foreign trade orders, leveraging our skilled workers..."

“These measures can be implemented now,” Li Yiqing pressed. “Why must we wait until privatization to carry them out?”

Cai Dafeng answered fluently: "Under the current state-owned system, workers lack motivation because they have secure jobs, sales staff lack incentives, and many decisions require multiple levels of approval, often resulting in missed market opportunities. These problems can only be completely solved after the reform."