Just posting the first page, the rest is at the link
In many fields of international competition, China is less sanguine about its abilities than outsiders. Chinese leaders often remind Westerners that China is a developing country, with hundreds of millions of people living in poverty, an unbalanced economy, and high social tensions. What should most worry Beijing, and provide some comfort to those who fear Chinese military expansionism, is the state of corruption in the People's Liberation Army (PLA).
True, the world underestimated how quickly a four-fold jump in Chinese military spending in the past decade would deliver an array of new weaponry to prevent the United States from interfering in a regional military conflict. Top American generals have worried publicly about "carrier-killer" ballistic missiles designed to destroy U.S. battle groups as far afield as the Philippines, Japan, and beyond. Last year, China tested a prototype stealth fighter and launched its maiden aircraft carrier, to augment new destroyers and nuclear submarines. What is unknown, however, is whether the Chinese military, an intensely secretive organisation only nominally accountable to civilian leaders, can develop the human software to effectively operate and integrate its new hardware.
Judging from a recent series of scathing speeches by one of the PLA's top generals, details of which were obtained by Foreign Policy, it can't: The institution is riddled with corruption and professional decay, compromised by ties of patronage, and asphyxiated by the ever-greater effort required to impose political control. The speeches, one in late December and the other in mid-February, were given by Gen. Liu Yuan, the son of a former president of China and one of the PLA's rising stars; the speeches and Liu's actions suggest that the PLA might be the site of the next major struggle for control of the Communist Party, of the type that recently brought down former Chongqing party boss Bo Xilai. Liu is the political commissar and the most powerful official of the PLA's General Logistics Department, which handles enormous contracts in land, housing, food, finance, and services for China's 2.3 million-strong military.
"No country can defeat China," Liu told about 600 officers in his department in unscripted comments to an enlarged party meeting on the afternoon of Dec. 29, according to sources who have verified notes of his speech. "Only our own corruption can destroy us and cause our armed forces to be defeated without fighting." This searing indictment of the state of China's armed forces, coming from an acting full three-star general inside the PLA, has no known modern precedent.
There is no way to independently verify Liu's withering assessment of the extent of corruption in the PLA, but he is well-positioned to make it. His professional experience includes a decade in the government of the central Chinese province of Henan and a decade in the paramilitary, taking him beyond narrow lines of command and patronage. His logistics department is integrated with all other arms of the Chinese military and his status as the descendant of a high-ranking leader, or princeling, enables privileged informal networks across military ranks and the civilian side of the party-state. Some Chinese and diplomatic PLA watchers believe Liu, the highest born of all the princelings now climbing into power, is on his way to the very top of China's military as a vice chairman of the Central Military Commission (CMC) after the current leadership retires following this year's 18th Party Congress, the first large-scale transfer of power in a decade. It helps that he is a close friend of the princeling president-in-waiting, Xi Jinping.
While Chinese leaders regard the United States as a likely future adversary, Liu is more worried about what the PLA, which hasn't seen significant combat since a militarily disastrous invasion of Vietnam in 1979, is doing to itself in times of peace. In his February speech, he described the army beset by a disease of "malignant individualism" where officers follow only orders that suit them, advance on the strength of their connections, and openly sell their services at "clearly marked prices."
