Visiting the Triads: Pt III

This is part of an ongoing series of non-fiction detailing my journey to Western China. Read Part I here and Part II here, if so inclined.

There’s a strange duality to mafias that only becomes apparent when you’re in the midst of one.

Movies and television shows are good at presenting a behind-the-scenes filled with intrigue, back-stabbing, family drama, and occasional disasters. At best, the public perception of mafias has morphed into an intense, ongoing murder mystery, and at worst, deadly groups that don’t care about collateral damage.

But the reality, at least from an objective outside perspective, is far, far removed from that. In fact, the main goal for all mafias is to blend into their surroundings seamlessly — the less death, gunfire, violence, and red flags, the better. They go out of their way to make sure that no one can decipher where normalcy ends and money laundering begins. It’s a difficult, but rewarding, business. And be aware that it is very much a business.

I reflect on the bid Yong’s laid out: work at the bakery, move to China on a work visa, sign a year long contract. It’s an enticing offer for a multitude of reasons: I love the area of China we’re in, the food is the best I’ve ever had, cost of living is ~$750/month (if you spend like crazy), and I’ve made a ton of friends who want me to stay.

Considering my few financial obligations back in the United States and my family and friends endorsing a long-term move, there’s little holding me back. But I hesitate. Something feels… wrong, and I can’t put my finger on what. But Yong keeps messaging me on WeChat asking for an answer.

There’s an easy way to solve this problem. We haven’t discussed numbers, working hours, what I’d be tasked with, or why Yong even wants me to work for him, so we will. And the first topic brought up will be compensation, and my demands will be outlandish.

Napkin math leads me to requesting roughly $3,500 a month. Of course, to Americans this sounds negligible ($42,000/yr isn’t too much more than minimum wage in California), but here’s the napkin math laid out:

At the end, this would provide $2,770 a month going directly into savings, untouched, while still supporting a happy, fully-funded existence in China. After a single year I’d have enough money to help put a down payment on a home or travel across the globe.

I’m also keenly cognizant of the fact that I’m requesting far too much: Yong’s top level management probably don’t make close to that salary, that being obvious from cost of living in the area where the factory resides on the border of China and Myanmar (an even cheaper, more rural section of Western China). So, I demand $3,500, and without grace.

“Perfect,” says Yong instantly.

Not the response I was hoping for. The opposite.

“Okay then.” I say.

It takes a considerable amount of time to understand that I’m in the midst of triad members.

When I first arrived in China, my friend Ben took me to see a warehouse full of mining rigs, mining Bitcoin and Litecoin.

I didn’t know much about the process then, so I asked simple questions with simple answers. Foolishly, I posed questions exclusively to the miners, who were young and dumb and enjoying the end of the ‘17/‘18 bullmarket. Instead, I should’ve been speaking to Tao, the owner of the microdam who was supplying the miner’s electricity.

Though many aspects of financial markets in China are similar to our markets in the West, it’s good to understand the key differences:

• there is no private ownership of property, only leasing from the state for extended periods of time (40–60 year and 99 year leases are common)

• the government subsidizes many small ventures with the expectation that the good produced will supply the surrounding community

• despite government being involved in every market in big ways, the Chinese markets are experiencing many of the same issues that fueled the ‘07/‘08 financial collapse in the US, including intense speculation and poor loaning practices

These basics help shape one’s interpretation of how black markets can operate and thrive in the East, and it’s by working with one important partner:

This is how I come to understand I am enjoying the company of multiple triads.

Tao is underreporting his energy production to the state and selling any excess to the cryptocurrency miners. How he is moving this money, I do not know, but can assume he knows or has bribed the right people.

Tao’s microdam

Tao introduces me to Yong.

Yong owns a host of bakeries in the area and further afield, to the north. But he only has one factory operational, and it’s alone in the south of the province — far from any of his stores. The best comparison I can make in US terms would be a bakery with locations in San Francisco and Sacramento, but a factory that’s eight hours away in San Diego. There are legitimate reasons to make a business decision like this — mostly cheap labor — but the Myanmari-Chinese border suffers from extreme issues in regard to importation of illegally mined jade, illegally harvested rare hardwoods, illegal immigration (ongoing civil war in Myanmar), human trafficking, and, perhaps most often, opium and heroin importation.

Before I know it, I’ve met people providing scalped electricity to cryptocurrency miners, a bakery owner with a very suspiciously located factory, and a furniture salesman who admits to me that he relies on illegally imported hardwood (the results are works of art, but at an unfortunate price).

A beautifully crafted piece made from hardwood illegally imported from Myanmar

At no point am I threatened by the triad members, but as I stall for time and ask more and more questions, they distance themselves.

For instance, I ask Tao what he did before he came to lease large pieces of property and rent electricity to cryptocurrency miners. “Truck driver,” he says.

“Wow,” I say, “and you saved up and were able to get all of this?”

Tao laughs. “Sure. Yeah.”

The access I’d been afforded when I’d initially landed in China slowly dissipates, until one day Tao will no longer allow me to visit his microdam and Yong stops sending messages. And that’s how the mafia is supposed to work.

Everything, on the surface level, seemed legitimate, until suddenly and all at once, it didn’t. But the solution wasn’t to have the Westerner catching wind of the shady dealings murdered or threatened — the answer was to just deny me all access, especially if I wasn’t going to play ball.

People ask “What do think Yong intended you to do as an employee?” and I think the explanation is far less devious or criminal than anyone hopes. Likely, the goal would’ve been to make me the white face for his European-style bakery, thus helping to legitimize his business and ease any authorities suspecting him of nefarious activities. The odds I’d have gotten into trouble or been ripped off are nearly non-existant.

There was a great lesson I took away from my experience in Western China, though, and it was that a properly functioning mafia is impossible to spot at first glance, and if someone starts to catch on to what they’re up to the easiest method to silence them is to simply ignore them. The Triads are a properly functioning mafia and the Chinese Communist Party is more than happy to work with them.

Stay skeptical, friends.

Fraud. Fraud everywhere.