A Close Look at the Brainwashing Industry in China: Revenue I (Part 2 of 4)
As briefly covered in part 1 of this series, the government fundings for brainwashing centers cover two major costs: construction and operations. In addition, centers draw revenue from three main sources: payments collected per detained practitioner (including education and companion fees from practitioners' employers), government awards for “successful transformations,” and extortion of practitioners and their families.
In part 2 and 3 of this series, we outline the major sources of funding and expenditures.
Building Construction and Equipment Costs
From figures provided in Part 1, provincial-level brainwashing centers cost on average 20 million yuan to construct, while city-level centers average 1.8 million yuan. Funding comes from the central government, local governments, and the private sector.
For example, of the 35 million yuan used to construct Shapingba Labor Camp Brainwashing Center, about 20 million came from government bonds. Wuhan City in Hubei Province once allocated 4 million yuan in the name of building a new flood control headquarters, but the money was actually used to construct a brainwashing center. 
In addition to the construction of buildings (or renovations in case of re-purposing existing buildings), brainwashing centers also require the installation of various confinement and torture equipment (e.g. solitary confinement cells, surveillance systems, electric batons, handcuffs, chains, “death beds,” etc).
From time to time, additional funding is needed to add new or replace worn-out equipment. For example, the Lanzhou City 610 Office in Gansu Province gave the Gongjiawan Brainwashing Center 100,000 yuan in June 2012 for meeting room furniture, television sets, and bedding.  Jinan Brainwashing Center spent 103,035 yuan in May 2012 installing surveillance systems. 
The private sector provides contributions in the form of mandatory donations: when the Hebei Province 610 Office ordered provincial and city-level organizations to make donations for renovating brainwashing centers, Shijiazhuang Dongfang Thermoelectric Company paid a lump sum of 200,000 yuan. 
Daily operational costs include staff salaries and benefits, utility fees, and rental costs (if the property is not owned). For example, the rental cost alone for Changchun Brainwashing Center in Jilin Province is in the hundreds of thousands of yuan each year. 
Local governments usually fund the staff members' salaries. For example, Lannigou Brainwashing Center in Guizhou Province employs two Communist Party secretaries and many officers responsible for logistics, security, collaborators, etc. Secretaries are given cars and chauffeurs.
In addition, dozens of “educators” are hired to “transform” practitioners. They work 9 hours a day, and shuttles were arranged for their transportation needs. A large security staff is also hired, most of whom are unemployed workers. Staff members working in the dining halls are often inmates from detention centers. However, their salaries are paid to their detention centers, not the individuals.
These expenses translate to high operating costs: Beijing Brainwashing Center costs as much as 400,000-500,000 yuan per day to operate,  while the Banqiao Brainwashing Center in Hebei Province costs three million yuan per year.  Xili Brainwashing Center in Shenzhen, Guangdong Province, with only 12 staff members, costs about 300,000 yuan monthly.  Officials often travel domestically or overseas in the name of “training” and receive large bonuses.
Revenue from “Education Fees”
For each practitioner admitted, a brainwashing center charges an “education fee.” These fees are paid by the practitioner's employer (if it is a state-owned enterprise) or local government. For example, when the Langfang City 610 Office arrested and sent 85 practitioners to a brainwashing center located in a hotel, the practitioners' employer, China Petroleum Pipeline Bureau, had to pay 850,000 yuan. These fees vary wildly by geographic region: in rural areas, it ranges from 1,500 yuan for a local resident to 30,000-50,000 yuan for a detainee from another town.
While some state-owned businesses were forced to pay the fee, others volunteered to do so. For example, after the Liaohe 610 Office arrested and sent nearly 100 practitioners from Liaohe Oilfield to a brainwashing center, Liaohe Oilfield officials voluntarily paid 3,500 yuan per practitioner as the education fee. 
Some businesses were intimidated by the steep fees. When Ms. Qiu Liying was arrested in January 2003, officials asked her employer, Shijiazhuang Oil Refinery, for 15,000 yuan.  After negotiations, the cost dropped to 50,000-60,000 yuan for 12 months, or 4,000-5,000 yuan per month. 
When the Changle Labor Camp held brainwashing sessions, officials often held practitioners there for one or two months. After a teacher was detained for 53 days, officials extorted 13,000 yuan from her employer, who refused to send more practitioners to the brainwashing center.
Even if practitioners have retired or were laid off, their previous employers were still held responsible for these education fees. For example, retired kindergarten teacher Ms. Huang Yanyun was detained at the Xining Brainwashing Center in September 2012 for 35 days. Officials forced Dongfeng Kindergarten, her former employer, to pay 5000 yuan.  Another case was Mr. Wang Zhiliang, a Shijiang City practitioner who had been laid off. When officials sent him to the Shijiazhuang Brainwashing Center in September 2007, they extorted 3000-6000 yuan in education fees from his former employer. 
Education fees vary by geographic location and are usually several times or more than ten times higher than the regional average salary. For example, Hubei Brainwashing Center charged an education fee of 15,000 yuan per month while the average salary was 460 yuan; as the average salary increased to 580 yuan in 2007, the education fee increased to 30,000 yuan per month. 
Below is a list of education fees charged by 42 brainwashing centers for which we have detailed information available.
As shown in the table above, education fees tallied from cases in which detailed information was available. The average fee is more than 9,400 yuan per month for each practitioner.
When a practitioner is not affiliated with a state-owned business, the local government absorbs the entire cost. In the case of Luotaishan Brainwashing Center in Fushun City, Liaoning Province, the county-level government paid 1,500 yuan per practitioner per session, while city and state-level governments each paid 1,000 yuan.  Each session is about one month long.
For each Shenzhen practitioner sent to the local brainwashing center in 2012, the city government paid 70,000 yuan.  Ximeng officials in Inner Mongolia adopted the same system; in 2011, the fee was 7,000 yuan per practitioner. 
Revenue from Companion Fees
Brainwashing centers typically employ four types of staff members: officers from the 610 Office or labor camps, “teachers” (previously “transformed” practitioners), companions from practitioners’ employers, and security personnel hired as temporary workers.
In addition to paying the education fees, practitioners’ employers were also required to send at least two companions to stay with practitioners and watch them 24 hours a day. When the National Working Committee held a brainwashing session in Changping District near Beijing in July 2001, they required three companions from each practitioners’ workplace, including one manager and two coworkers. 
Instrumental to the “transformation” process, companions are ordered to isolate practitioners physically and mentally from other practitioners. For example, at the Xinjin Brainwashing Center in Chengdu, Sichuan Province, practitioners are not allowed to go to the dining hall; instead, one of their companions must retrieve their meals for them.
Even bathroom visits require approval from both companions: one would make sure no other practitioners were around before escorting his assigned practitioner to the bathroom. Companions also play propaganda videos to their assigned practitioners, keep detailed records of their behavior, and report to officials.
Employers who do not wish to contribute two companions are required to pay a “companion fee” for labor provided by the brainwashing center. Based on the limited statistics available, the charge for each companion ranges from 80 to 100 yuan per day.    Centers require two companions per practitioner. The companion fee per practitioner (two companions per practitioner) ranges from 4800 to 6000 yuan per month. We use 5400, the average of the 4800 and 6000 for our estimate of the scale of the industry presented in part 1.
Brainwashing centers make a large profit margin on companion fees. For example, in 2003, a brainwashing center in Fushun, Liaoning Province hired individuals to act as companions and paid them 280 yuan per month.  In 2010, Xinjin Brainwashing Center in Chengdu, Sichuan Province paid companions 700 yuan per month, in addition to room and board.  The Shenzhen “Legal Education School” pays unemployed workers just over 1000 yuan per month to act as companions and monitor detainees around the clock. 
In some cases, practitioners' employers take advantage of this system and assign their relatives to act as companions to make some easy money. For example, in Hebei Brainwashing Center, a practitioner's employer used company funds to pay his sister a company travel stipend (100 yuan per day over several months) to act as the practitioner's companion. Sometimes, these funds would later be deducted from the practitioner's wages. 
This concludes the second installment of a four-part series on China's brainwashing industry. More details about how the system allows officials to amass personal fortunes will appear in future articles.
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