[House Hearing, 109 Congress]
[From the U.S. Government Printing Office]





                         FORCED LABOR IN CHINA

=======================================================================

                               ROUNDTABLE

                               before the

              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                             JUNE 22, 2005

                               __________

 Printed for the use of the Congressional-Executive Commission on China


         Available via the World Wide Web: http://www.cecc.gov


                                 ______

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              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                    LEGISLATIVE BRANCH COMMISSIONERS

Senate                              House
                                    
CHUCK HAGEL, Nebraska, Chairman     JAMES A. LEACH, Iowa, Co-Chairman
SAM BROWNBACK, Kansas               DAVID DREIER, California
GORDON SMITH, Oregon                FRANK R. WOLF, Virginia
JIM DeMINT, South Carolina          JOSEPH R. PITTS, Pennsylvania
MEL MARTINEZ, Florida               ROBERT B. ADERHOLT, Alabama
MAX BAUCUS, Montana                 
CARL LEVIN, Michigan                
DIANNE FEINSTEIN, California        
BYRON DORGAN, North Dakota          

                     EXECUTIVE BRANCH COMMISSIONERS

                  STEPHEN J. LAW, Department of Labor
                 PAULA DOBRIANSKY, Department of State

                David Dorman, Staff Director (Chairman)

               John Foarde, Staff Director (Co-Chairman)

                                  (ii)


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

Wu, Harry, founder and Executive Director, Laogai Research 
  Foundation, Washington, DC.....................................     2
Fiedler, Jeffrey L., President, Food and Allied Service Trades 
  Department, AFL-CIO, co-founder, Laogai Research Foundation....     5
Xu, Gregory, Falun Gong practitioner and researcher, Edison, NJ..     7

                                APPENDIX
                          Prepared Statements

Wu, Harry........................................................    24
Fiedler, Jeffrey L...............................................    36
Xu, Gregory......................................................    40

 
                         FORCED LABOR IN CHINA

                              ----------                              


                        WEDNESDAY, JUNE 22, 2005

                            Congressional-Executive
                                       Commission on China,
                                                    Washington, DC.
    The roundtable was convened, pursuant to notice, at 10 
a.m., in room 2255, Rayburn House Office Building, David Dorman 
(Staff Director (Chairman)) presiding.
    Also present: John Foarde, Staff Director (Co-chairman); 
Susan Roosevelt Weld, General Counsel; Patricia Dyson, Senior 
Counsel, Labor Affairs; Carl Minzner, Senior Counsel; Adam 
Bobrow, Counsel, Commercial Rule of Law; and Katherine Palmer 
Kaup, Special Advisor on Minority Affairs.
    Mr. Dorman. It is just about 10 o'clock, so we will get 
started in just a minute. Before we do that, I would direct 
everybody's attention to the table in the hallway, which has 
statements from all the witnesses. So if you would like to have 
a copy of the witness statements before we get started, now is 
the time to do that. Good.
    Well, thank you to our witnesses and to the audience for 
attending this staff-led issues roundtable, one in a series of 
roundtables put on by the Congressional-Executive Commission on 
China.
    Today, this roundtable will examine the use of forced labor 
in China. Forced labor is an integral part of the Chinese 
administrative detention system. China has adopted, like all 
members of the ILO, the Declaration on Fundamental Principles 
and Rights at Work, which includes a guarantee for freedom from 
forced labor. The Commission remains troubled that China is not 
meeting its obligation under that particular Declaration, hence 
the roundtable today.
    Section 307 of the Tariff Act of 1930 prohibits the import 
of goods made by prisoners into the United States. To enforce 
this law, the United States signed a Memorandum of 
Understanding with the Chinese Government in 1992 in which the 
Chinese Government agreed to assist in investigating reports of 
prison labor products reaching the United States. According to 
the State Department's 2004 Human Rights report, at last year's 
end, the backlog of relevant cases remained substantial. The 
Commission expects the Chinese Government to meet its 
obligations under the 1992 Memorandum of Understanding.
    There are continuing reports of the use of forced labor in 
Chinese detention facilities. Reports indicate that Falun Gong 
practitioners and other prisoners detained under China's 
reeducation through labor system have been producing goods for 
local and export markets under highly abusive conditions, and 
we will hear some testimony today specifically on that issue.
    Corruption associated with the management of profit-making 
prisons has generated some national attention in China. In 
September 2003, the Chinese Government announced experimental 
plans to separate the production units from the direct 
supervision of prison wardens and place them under the control 
of provincial administrators. To date, no such plans have been 
implemented.
    In spring 2005, Chinese diplomats assured U.S. officials 
that the International Committee of the Red Cross [ICRC] will 
soon be opening an office in Beijing. Once in place, the ICRC 
may be able to create more transparency in the Chinese 
detention system. Again, the Commission expects the Chinese 
Government to meet its obligation to allow an ICRC office.
    I am very pleased to introduce our witnesses. We have a 
very distinguished panel. As has been the case in previous 
roundtables, the way that we run the proceeding is to give each 
witness, after an introduction, 10 minutes for an opening 
statement. We are rather strict in holding witnesses to their 
time, to allow plenty of time for questions and answers. After 
all the witnesses have given their statements, we go to a 
question and answer period, giving each staff member on the 
dais five minutes to ask a question and hear an answer. We will 
continue the roundtable until 11:30, or until we run out of 
questions. Generally, we find it easy to fill out the entire 90 
minutes with conversation.
    I am very happy to introduce the first member of our 
distinguished panel, Mr. Harry Wu. Mr. Wu is founder and 
Executive Director of the Laogai Research Foundation. The 
Laogai Research Foundation has documented the use of forced 
labor in China since 1992. The Foundation publishes an annual 
Laogai handbook, newsletters, special investigative reports, 
and assists television media in preparing documentary films on 
the Laogai system.
    The Foundation has expanded its focus to report on other 
human rights issues, including organ harvesting and the 
persecution of religious believers.
    Mr. Wu, you have 10 minutes for your opening statement.

 STATEMENT OF HARRY WU, FOUNDER AND EXECUTIVE DIRECTOR, LAOGAI 
              RESEARCH FOUNDATION, WASHINGTON, DC

    Mr. Wu. Ladies and gentlemen, today we have come here to 
talk about forced labor in China. If we talk about forced 
labor, we must talk about the Laogai, China's vast labor reform 
system and the Chinese Communist Party's primary instrument for 
detaining political dissidents and penal criminals.
    The two major aims of the Laogai are to use all prisoners 
as a source of cheap labor for the Communist regime, and to 
reform criminals through hard labor and compulsory political 
indoctrination.
    Many actions have been taken over the past 15 years that 
were supposed to curb U.S. imports of products coming from 
Chinese prison camps. For instance, the Memorandum of 
Understanding on Prison Labor was signed by the United States 
and China, detention orders were enforced by the U.S. Customs 
Service, and companies suspected of importing Laogai products 
were taken to court. However, from the testimony of Mr. Fiedler 
and Mr. Xu, we can see that these actions have not stopped 
forced labor products from entering the United States.
    We must understand the nature of the Laogai itself in order 
to understand forced labor in the Laogai and to learn how to 
stop these products from being exported to countries outside 
China. The Laogai is not a dying institution, as some have 
suggested. It is true that the composition of the camps has 
changed. In the past, the majority of criminals were jailed for 
political reasons, and the majority of today's inmates are 
incarcerated for more common crimes. Nevertheless, this does 
not indicate a fundamental change in the nature of the Laogai. 
To the contrary, the Chinese Government's dependence on the 
Laogai as its primary tool of suppression is as strong now as 
it was in the days of Chairman Mao Zedong's rule.
    For those imprisoned for common crimes but deprived of 
their due process or forced to labor under barbaric conditions, 
the Laogai is alive. For those imprisoned for publicizing their 
beliefs, for those caught fighting for Tibetan independence or 
labor unions, for those persecuted for asserting their 
religious rights, the Laogai is very much a living institution.
    When President Ronald Reagan proclaimed that the Soviet 
Union was an evil empire, he had many reasons for doing so, but 
one of the main reasons was the existence of the Soviet gulag. 
Recently, much attention has been focused on the North Korean 
gulag. Some people today even say that the Guantanamo Bay 
prison camp is an American gulag. But why is there no 
discussion of the Chinese gulag? Very few people today talk 
about the Chinese gulag. The forced labor products we are 
talking about here today come from the Chinese gulag. If we are 
talking about forced labor products in China, we must also talk 
about the Laogai.
    Some American academics, including James Seymour from 
Columbia University and another professor from Georgetown 
University, have said that while the Laogai is ``pretty bad,'' 
it cannot be compared with the Soviet gulag. However, is this 
really the case? Today more than a quarter century after Mao's 
death, the Laogai system still thrives, and an untold number of 
prisoners continue to suffer behind the high walls and the 
barbed wire fences of more than 1,000 Laogai camps.
    A majority of the inmates currently in the Laogai is 
incarcerated for reasons that have little to do with politics 
or class background; however, the Laogai still serves its 
political purpose. Individuals deemed to be threats to China's 
one-party system may be held for ``crimes against the state or 
public security'' or ``revealing state secrets,'' or for other 
offenses that have the ring of more common crimes, such as 
hooliganism or arson, that actually mask politically motivated 
incarceration.
    Additionally, the general lack of due process in the 
Chinese legal system victimizes countless individuals. Well-
documented reports of several human rights organizations have 
revealed a system where individuals are often convicted and 
sentenced with no trial at all. Even when an individual is able 
to secure their right to trial, they are often refused the 
right to adequately defend themselves, or they are convicted 
through so-called ``evidence'' that was extracted through 
torture.
    If we want to see the advent of democracy and freedom in 
China, we must talk about the Laogai, because democracy and 
freedom are incompatible with the Laogai. There are many 
hearings in CECC and other institutions devoted to the 
discussion of human rights violations in China, including the 
persecution of Tibetans, Uighurs, Internet, and religious 
dissidents, and Falun Gong practitioners.
    These issues are all discussed separately, even though 
members of all of these persecuted groups are ultimately sent 
to the Laogai. The Laogai system, as a whole is never 
discussed. Efforts by the Laogai Research Foundation and other 
human rights groups to focus international attention on this 
system resulted in the Chinese Government dropping the term 
``laogai,'' (reform through labor) from its official documents 
and replacing it with the word ``prison'' in 1994. This, as 
well as other pronouncements by the Chinese Government in 
recent years, was designed to create the impression abroad that 
the Chinese system is similar to penal systems found in the 
West. However, as Chinese authorities emphasize, the function 
of reform through labor remains unchanged. Severe violations of 
human rights continue to take place in the Laogai system.
    China's efforts to stop the use of the word ``laogai'' in 
order to improve its international imagine came too late. The 
Laogai Research Foundation was pleased to bring about the 
addition of the word ``laogai'' in the Oxford English 
Dictionary [OED] in 2003, after over a decade of efforts to 
raise awareness and expose the Laogai, China's brutal system of 
labor camps. This marked an historical milestone for the Laogai 
Research Foundation and its work.
    The inclusion of the word ``laogai'' into the lexicon of 
the OED is not only a recognition of the Laogai's existence, 
but is also acknowledgement of the hard work of those trying to 
expose its atrocities. The Oxford English Dictionary's entries 
for ``laogai'' make the distinction between the Soviet gulag as 
a thing of the past and the ``laogai'' as a system that remains 
fully operational in China today.
    It is common knowledge that every totalitarian regime must 
have a suppressive mechanism to maintain its hold on power. 
China is no exception. Issues such as the persecution of 
Tibetans and Falun Gong practitioners, the detention of 
Internet activists, and forced labor products in China should 
not be discussed in isolation.
    The subject of China's Laogai encompasses all of these 
issues, and the system of repression embodied by the Laogai 
must be talked about as a whole in order to get to the root of 
the suppression that is taking place and bring about freedom in 
China. Thank you.
    [The prepared statement of Mr. Wu appears in the appendix.]
    Mr. Dorman. Mr. Wu, thank you very much. I just want to 
express our gratitude to you for testifying today and providing 
your expertise on this subject to the Commission.
    Next, we will hear from Mr. Jeff Fiedler, who is President 
of the Food and Allied Services Trades Department of the AFL-
CIO, and a co-founder of the Laogai Research Foundation.
    When Mr. Wu was detained in 1995, Mr. Fiedler coordinated 
the public campaign to win his release. Mr. Fiedler is a member 
of the Council on Foreign Relations and the Pacific Council on 
International Policy.
    He attended three of the American Assembly Conferences on 
China sponsored by Columbia University, and has been 
interviewed on CBS, NBC, ABC, CNN, and CNBC regularly on China 
policy, international trade issues, human rights, and child 
labor.
    Mr. Fiedler, you have 10 minutes for your opening 
statement.

  STATEMENT OF JEFFREY L. FIEDLER, PRESIDENT, FOOD AND ALLIED 
   SERVICE TRADES DEPARTMENT, AFL-CIO, AND CO-FOUNDER OF THE 
           LAOGAI RESEARCH FOUNDATION, WASHINGTON, DC

    Mr. Fiedler. I will limit myself to the United States and 
U.S. Government policy, practice, and recent history, if you 
will, regarding forced labor products coming into the United 
States, and I will not detail my written testimony.
    For background purposes, it is important to understand that 
the first Memorandum of Understanding [MOU] on Prison Labor 
that was negotiated by the State Department under the first 
Bush Administration was, in my view, in response to political 
circumstances in the United States that potentially exacerbated 
the relationship between the United States and China, and 
complicated the Most Favored Nation [MFN] status debate from 
some people's point of view. In its first instance, in my view, 
the term ``prison labor'' was intentionally misleading. In 
other words, the U.S. Government did not accept the term 
``forced labor,'' it used ``prison labor,'' which was deceptive 
in the following sense, that, oh, California has prison labor. 
We just do not want to import products into the United States 
that are made cheaply by prisoners in another country in the 
world. That was not, of course, our issue. Our issue was that 
the forced labor system itself in China was the aberration and 
was what should be dealt with.
    Then the MOU's implementation--by the way, there is one 
other variant of this, and that is, the word ``inspection'' was 
used in association with the MOU. If you look at the 
attachments to my testimony with the actual MOU, you will not 
see the word ``inspect'' anywhere in it. Those of you who have 
diplomatic experience understand that the word ``inspection'' 
is very different in meaning from the word ``visit.'' There are 
nuclear ``inspections,'' then there are ``visits.'' One term is 
more powerful than the other, the word ``inspection.'' And the 
Chinese never agreed, by the way, to any inspection. They 
agreed to a bureaucratic system that was not very good, and 
even then they did not implement it.
    But ending Chinese ``prison'' exports of forced labor 
products to the United States became a must-do condition in the 
MFN debate under the Clinton Administration--President Clinton 
set implementation of the MOU as a must-do condition for the 
Chinese.
    Well, there was no way that the Clinton Administration 
could say that the Chinese were implementing the agreement, so 
in a diplomatic sleight of hand, in my view, they negotiated a 
Statement of Cooperation which said the Chinese would do 
better. They then held the Statement of Cooperation up as 
compliance with the must-do condition. So you see that all of 
this stuff is done in a political context, which, arguably, 
would have been better if there were no sort of political 
pressure for this.
    Now, after the MFN, and subsequently Permanent Normal 
Trading Relations [PNTR] debates for China and entry into the 
World Trade Organization [WTO], the government has fallen 
asleep on the question of forced labor exports to the United 
States. The Customs Service certainly does not talk to us. They 
do not talk to the Falun Gong. You do not read anything about 
this issue. You see no findings in the Federal Register.
    Yet people like us and our researchers will go to the 
Internet to a Web site called ``China Big,'' which is co-owned 
by R.H. Donnelly, a U.S. company, and find, I believe, 126 
forced labor camps listed on the Internet with their commercial 
names. There are very few with their actual prison names, but 
there are a couple, and we believe 31 to be camps or production 
facilities run by the police that are associated with camps. 
This, by the way, is on top of the 99 camps we found doing $700 
million a year in production listed in Dun & Bradstreet's China 
directory some years ago.
    So what is the point of the U.S. Government doing it? You 
see in my testimony a series of proposals to change U.S. policy 
and change U.S. law. Our objective should not be, simply, under 
the 1933 Act, to punish U.S. people who import forced labor 
products. The evidence for that is largely in China, and the 
U.S. legal system does not recognize the validity of the 
testimony if the witnesses are somewhere else, or the paper 
documents are somewhere else, and I would not want to send 
somebody to jail, either, based upon flimsy evidence. But now 
the issue becomes, one, are we interested, as a matter of 
policy, in ending forced labor in China? Two, as a vehicle to 
do that, are we interested in ending forced labor exports by 
the Chinese to our country and other countries? If we are, then 
we should set different evidentiary standards for the 
importation of hand tools, for instance. Those are not human 
beings, those are hand tools.
    We should use our intelligence resources in ways that we 
have not done up until now. I mean, once someone asked us, 
``How come you can find forced labor product exports in the 
United States and the U.S. Government cannot? '' My not-too-
glib answer was, ``Because we want to, and they do not.'' I 
still believe that. So if people are serious, this Commission, 
and others, can sit down and say, all right--let's look at the 
problem. There is a task force, I believe, in the law that 
established this Commission, that has probably never met, or 
has rarely met, and has not issued a report of any kind that 
the public has seen, at least that I could find. And we sit 
down and say, ``All right, here is the problem.'' This is what 
they did when the Laogai Research Foundation exposed it: you 
drove them deeper underground. Oh, well. You got only a few 
dollars a year, but we are the U.S. Government and we have a 
little bit more.
    We will offer rewards to U.S. businessmen, and to Taiwanese 
businessmen, and Korean businessmen, and European businessmen 
and women, anybody who reports hard evidence to the U.S. 
Government that can be corroborated about forced labor in 
China.
    Let me tell you, I suspect that more than a few people are 
privately angry, such as the U.S. businessman was who was 
making binder clips and who took it upon himself some years ago 
to track the forced labor exports down himself, with our 
assistance. There are businessmen who are angry that they are 
being undercut by Chinese forced labor products. I am less 
interested in business than I am in ending the forced labor 
system. I am much more interested in that. But it is a vehicle 
for us to do so, and I think the Commission ought to give more 
serious thought to actually getting to enforce the cooperation 
and the task force that exists in current law. We would be more 
than agreeable to help in that process.
    Mr. Dorman. Good. An extra minute for Mr. Xu.
    Mr. Fiedler. I try to be timely.
    Mr. Dorman. Thank you very much for that testimony.
    Mr. Fiedler. He much deserves the extra minute.
    [The prepared statement of Mr. Fiedler appears in the 
appendix.]
    Mr. Dorman. Both you and Mr. Wu have provided us plenty to 
talk about in the question and answer session.
    Our next witness is Mr. Gregory Xu, a Falun Gong 
practitioner, and researcher on the treatment of Falun Gong 
practitioners in China. Mr. Xu has collected reports from all 
parts of China on the imprisonment of practitioners since 1991. 
He is a software engineer for a technology company.
    Mr. Xu, 10 minutes for your opening statement, please.

     STATEMENT OF GREGORY XU, FALUN GONG PRACTITIONER, AND 
  RESEARCHER ON THE TREATMENT OF FALUN GONG PRACTITIONERS IN 
                       CHINA, EDISON, NJ

    Mr. Xu. Mr. Dorman, staff members of this Commission, 
ladies and gentlemen, thank you for giving me this opportunity 
to speak on the plight of Falun Gong practitioners in China.
    We are grateful for the support that this Congress has 
shown us during this difficult time. We are, however, sad to 
report that in the past six years, the persecution of Falun 
Gong in China has gone into a covert one, but has continued to 
worsen. Over the years, between 200,000 and 1 million 
reportedly have been sent to forced labor camps without trials. 
The persecution methods used in such camps are extremely cruel, 
encompassing a wide variety of brutal tortures; and yet the 
Chinese Government has imposed strict blockades in an attempt 
to conceal information and absolve itself of responsibility.
    Most recently, Falun Dafa Information Center [FDI] has 
learned that Ms. Gao Rongrong, whose face was grossly 
disfigured as a result of torture in Longshan Forced Labor 
Camp, was murdered and died on June 16, 2005. Ms. Gao went 
through nearly two years of incarceration, brainwashing, and 
torture for her beliefs in Falun Gong. Her case even involved 
directives from Luo Gan, one of the Standing Committee members 
on the Chinese Communist Party's Politburo.
    In July 2003, Ms. Gao was sent to Longshan Forced Labor 
Camp. On May 7, 2004, at approximately 3 p.m., Tang Yubao, the 
deputy head of the No. 2 Prison Brigade, along with team leader 
Jiang Zhaohua, summoned Ms. Gao to the office and began to 
torture her with an electric baton.
    The torture continued for about seven hours, and the 
inmates in the labor camp said that Ms. Gao sustained multiple 
burns to her face, head, and neck. Ms. Gao's face was covered 
with blisters and her hair was matted with pus and blood. So 
severe were the injuries, that Ms. Gao's face was disfigured 
and she had difficulty seeing. Shocking photos made their way 
overseas, and they were publicized widely. You can see, 
actually, from the other report, Ms. Gao's picture. Details of 
her case were submitted to relevant government offices in the 
United States and other nations, and were also presented to the 
United Nations. As international pressure mounted concerning 
Gao's case, Luo Gan, one of China's highest-ranking officials, 
stepped in. Luo proceeded to order the Liaoning Province 
Chinese Communist Party Political Judiciary Committee, the 
Procuratorate, the Department of Justice, and the police 
department to conceal any and all information about Ms. Gao's 
case.
    On March 6, 2005, Ms. Gao was located by police and again 
abducted. Neither her location nor her condition was revealed 
to her family members until June 12, when she was sent to the 
Medical University Hospital in Shenyang City from the Masanjia 
Labor Camp. According to Ms. Gao's family, by the time they 
reached the hospital on June 12, Ms. Gao had lost 
consciousness. Her organs were atrophying, and she was hooked 
up to a respirator. They said she was little more than skin and 
bones. Ms. Gao died four days later. Chinese police are now 
pressuring Ms. Gao's family to cremate her body quickly, trying 
to eliminate the evidence of torture.
    Ms. Gao's death is part of a disturbing pattern of 
systematic rights violations, systematic cover ups, and zero 
accountability. Since China's former president, Jiang Zemin, 
launched the persecution of Falun Gong in 1999, according to 
incomplete statistics, more than 180 forced labor camps in 
China have directly participated in persecution through illegal 
forced labor of over 200,000 Falun Gong practitioners.
    In addition to forced brainwashing and torture, China's 
labor camps also force a large number of Falun Gong 
practitioners to work as slave laborers. Falun Gong 
practitioners have been made to work overtime shifts, subject 
to punishment by deprivation of food or sleep if assigned 
quotas are not met, and tortured if they refuse to cooperate. 
They are often arbitrarily detained beyond their release dates 
because of the huge profits that the camps stand to gain as a 
result of free labor.
    Practitioners are forced to work more than 10 hours a day, 
sometimes even continuously overnight. Because of the terrible 
working conditions and the highly labor intensive work, Falun 
Gong practitioners have all suffered various degrees of damage, 
both mentally and physically. Some have become disabled, or 
have even died. About 30 percent of all of the death cases of 
Falun Gong practitioners resulted from torture in the labor 
camps. Sixty-nine labor camps have directly caused the deaths 
of Falun Gong practitioners, including elderly people in their 
60s and an eight-month-old infant. Even women, children, or 
disabled practitioners were not spared.
    U.S. citizen Charles Lee was arrested upon arriving at the 
Guangzhou airport on June 22, 2003. He was rushed through a 
one-day show trial on March 21, 2003, and sentenced to a three-
year prison term for his intention of exposing human rights 
violations against the Falun Gong practitioners by the Chinese 
Government.
    According to the information from his friends, throughout 
two and a half years of detention, Dr. Lee has suffered both 
physical and mental abuses. He has been beaten, force fed, 
deprived of sleep, handcuffed for days at a time, and forced to 
watch anti-Falun Gong brainwashing videos. Starting from early 
to late June 2004, Dr. Lee was forced to make Christmas lights 
daily. At times, he was forced to work 10 to 12 hours a day, 
and seven days a week. These Christmas lights are to be 
exported to the United States.
    FDI and the World Organization to Investigate the 
Persecution of Falun Gong [WOIPFG] investigated the persecution 
of Falun Gong and has collected ample evidence that shows 
China's labor camps cooperated with companies to force Falun 
Gong practitioners to manufacture forced labor products without 
any payment during their detention. Products from these labor 
camps are exported to more than 30 countries and regions, 
including the United States, Canada, Australia, France, 
Germany, New Zealand, Southeast Asia, et cetera.
    For example, WOIPFG reported that there are two main 
products made for the Henan Province hair products industry by 
over 800 detainees, including illegally detained Falun Gong 
practitioners in Hunan Province's No. 3 Labor Camp and the 
Shibalihe female labor camp in Zhengzhou city, have been pushed 
to work day and night by guards who threaten them with torture, 
punishment, and humiliation. They work extra hours to bring in 
foreign exchange income and more profits for the labor camps 
for the Henan Rebecca Hair Products, Inc.
    To increase profits, Hunan Province and No. 3 Labor Camp 
even buy Falun Gong practitioners as slaves from other places 
for 800 yuan each. When the labor camp was short of funds and 
was about to be shut down, many Falun Gong practitioners were 
abducted and incarcerated in this camp where they were forced 
to make hair products. The United States is the largest 
distribution and consumer market of hair products in the world. 
Henan Rebecca Hair Products, Inc. accounts for a significant 
market share in the United States.
    Statistics show that the United States has a need for 15 
million human hair weavings, many of which come from Henan. 
WOIPFG has submitted a petition to the Department of Homeland 
Security for an immediate investigation and environmental 
action on certain wigs exported by Henan Rebecca Hair Products, 
Inc.
    The crackdown on Falun Gong over the past six years in the 
People's Republic of China has led to unjust imprisonment of 
hundreds of thousands of innocent practitioners. Consequently, 
many children have lost either one or both parents, sometimes 
even their caregiver. According to the 2005 report of Global 
Mission Rescue [GMR], on persecuted Falun Gong practitioners, 
five children were killed in police custody; 18 children lost 
both of their parents during the persecution; 102 children lost 
one of their parents; 43 children are directly targeted, 
tortured, and thrown into prisons in the labor camps because of 
their parents' belief in Falun Gong; 39 children were forced to 
separate from their parents because their parents are detained. 
In addition, hundreds of thousands of children have been forced 
to slander Falun Gong, or upon refusal, be expelled from 
school. Moreover, many young ones are discriminated against, as 
their parents are practicing Falun Gong.
    This data, however, only represents the information 
investigated and confirmed by GMR. Due to censorship and the 
tight hold on information related to Falun Gong in China, what 
has been reported so far represents perhaps only a tiny tip of 
the iceberg. I hope that this testimony will help you 
understand the severity and the scope of this ruthless campaign 
of persecution against the Falun Gong practitioners of China.
    Thank you for your consideration. I would be pleased to 
answer questions.
    [The prepared statement of Mr. Xu appears in the appendix.]
    Mr. Dorman. Mr. Xu, thank you very much for your testimony.
    For those of you who have arrived late, I just want to 
point out that written statements from the witnesses are on a 
table in the hallway. There are also additional materials from 
the Laogai Research Foundation on the table. Our Senior Counsel 
for Labor Affairs, Pat Dyson, has put a few copies of the new 
ILO report on forced labor on the table as well. So, please 
feel free to take copies if you would like.
    Each of the staff on the dias now has five minutes to ask a 
question and hear an answer from the witnesses. We should be 
able, I think, to get through two rounds of questions before we 
reach 11:30.
    I have a brief question for the entire panel, and a shorter 
question, if I have time, for Mr. Fiedler specifically.
    Realizing the depth of experience here today on this 
particular issue, and at least two of you have been researching 
this issue much, much longer than the Commission, I wanted to 
get a sense of where the Chinese leadership is on this issue 
right now, because an important part of what this Commission 
tries to do, as you point out, Mr. Fiedler, is to usefully, 
effectively, constructively, insert itself into the 
conversation. Pat Dyson recently showed me a speech from last 
year, I think, by China's Minister of Justice. The speech, 
which I referenced in my opening statement, described some 
plans, some intentions, some discussions by the Chinese 
Government to separate production units from the management 
authority of prison wardens.
    Something else that Pat has briefed me on is discussions in 
China on eliminating forced labor, not so much because it 
violates sensibilities and international agreements, but 
instead because the profits from forced labor feed official 
corruption, a problem we all know is growing in severity in 
China.
    So, based on your understanding and extensive research, 
could each of you in turn comment on your analysis of comments 
like this from Chinese authorities, and what these comments 
tell us in terms of intentions.
    Mr. Wu, would you like to begin?
    Mr. Wu. I think, first of all, we have to realize that 
American law is talking about forced labor in that, if the 
product is processed by forced labor, or partially or wholly 
made by forced labor, it is illegal.
    Jeff Fiedler mentioned the binder clips. The entire 
material of the binder clips comes from a legitimate factory, 
but they are only using female prisoners to assemble the clips. 
We have evidence that all the female prisoners' fingers are 
bloodied just from putting wires into the clips. This process 
is illegal. End it, and the prison men will go to court.
    Another case is artificial flowers. A witness who is now in 
New York was forced to make such flowers, in a detention 
center, before he had undergone a trial. The flowers were 
designed and made by other legitimate companies or factories. 
The prisoners, even before undergoing a trial, were waiting in 
the detention center and assembling products. This is illegal. 
So we must know what is the real definition of what is known as 
an illegal product? It is not like we are able to easily 
ascertain that, ``Oh, this is a brand from a prison camp.''
    The Chinese today say, ``Well, we have a police family 
workshop.'' So an American investigator goes to China and they 
say, ``Do you want to see it? I can show you all these 
daughters and sons of policemen working on the production line. 
They are not prisoners at all.'' But the parts come from the 
workshop in which the prisoners work.
    I can go further. I can tell you, probably seven years ago, 
Chrysler Corporation had a Jeep Cherokee factory in China. 
Several years ago, the Jeep Cherokee factory in Beijing 
announced that ``we are pretty good now, and most of our parts 
come from Chinese companies, not necessarily imported from the 
United States.'' They had a long list of Chinese suppliers. 
Among these suppliers, a number of them were prison camps. 
According to American law, it is illegal to import the Jeep 
Cherokee to the United States, because some parts were 
partially made by forced labor. I really doubt that Americans 
really care about this issue.
    If they really want to do something about it, they should 
implement the law. I am not talking about a human rights issue 
at this moment. I am an American citizen, an American taxpayer. 
I want to ask the government to implement the law. It is their 
duty. It is my right to ask for it. You listened to what Jeff 
Fiedler said. They do nothing. There is a case--and later maybe 
Mr. Fiedler can explain to you about the graphite products--and 
they just drop it. For example, the binder clips case. All of 
this hard evidence and these witnesses were produced by us. 
Otherwise, the case would never have come to light. But we have 
such a powerful Customs Service institution there, the question 
is whether they implement the law or not.
    Mr. Fiedler. To answer your question more directly, 
obviously I am suspicious of the Chinese leadership's 
expression of a desire to change. We have heard them on any 
number of subjects.
    In my view, they want their system to appear to be a prison 
system like everyone else's yet the sort of persecution of the 
Falun Gong has presented them with a dilemma. The government is 
acting much more like it did 30 years ago than like it was 
heading toward more recently.
    The notion of profitmaking. Actually, the rationale was not 
profitmaking to start with. The rationale was to have the 
system be self-paying so that it was not a drag on the 
government's revenue. It led into profitmaking.
    It led into profitmaking, in my view, among other reasons, 
because recently--in the last 10 or 15 years--you did not have 
any power in China unless you had access to dollars. Anybody 
who had access to hard currency and business was more powerful 
than somebody who did not. The overseers of the system did not 
want to be left out in the rush, in the laissez faire 
capitalist rush that was overtaking China, one can argue. So I 
do not believe that they are serious, other than to make it 
appear as if they have a new system. We do not see any 
evidence. As a matter of fact, we see all evidence to the 
contrary to that development.
    Mr. Dorman. Good. My time is up.
    Mr. Xu, if you would like to comment on my question, we can 
get it in the next round. I want to move on, because we have 
many staff members who would like to ask questions.
    I am going to turn the microphone over to John Foarde, my 
colleague, who serves as Staff Director for our House of 
Representatives Co-Chairman Congressman Jim Leach.
    John.
    Mr. Foarde. Thank you, Dave.
    Let me address this question to both Jeff Fiedler and Harry 
Wu, just for the record, so we can understand more fully. All 
three of you have spoken quite eloquently about the export of 
forced labor products to the United States from China. How much 
export of forced labor products is there to other countries 
besides the United States, and do you have any sense of whether 
or not it is more or less than to the United States, and 
roughly what percentage may be going elsewhere?
    Mr. Wu. We do not have accurate numbers because the 
statistics are hiding in, as the Chinese have said, indirect 
exports. The United States is the only country in the world 
that forbids products made by forced labor from being imported. 
We find many products in London, in Toulouse, in Paris, and 
nobody cares about that. So, we do not have any figures for 
that. But, anyway, they just go on.
    Mr. Fiedler. There are certain kinds of products. For 
instance, the Liaoning Laogai that historically produced entire 
trucks, which were exported throughout Southeast Asia. The 
Chinese product manuals that we have examined over the years, 
and of course ever since we exposed the information they kind 
of stopped bragging about it, always included information about 
exports. They would say they export to the United States, 
Europe, and Australia. I do not know how much of it is, in 
fact, true. We have no real sense of the size of the trade.
    But you can get a sense, from the Dun & Bradstreet 
information that was from the Chinese statistical annuals, on 
Laogai company revenue. Again, one must take such information 
somewhat with a grain of salt as with any statistics coming out 
of China. Of 99 camps, according to their information, they 
were doing $700 million worth of business.
    These were largely coastal camps and Guangdong camps that 
mirrored the sort of economic development of the country, not 
the backwater, provincial camps that make bricks and cement. By 
the way, the labor is no more gratifying in those places than 
it is in the coastal areas. So, it is very hard. We do not have 
any good numbers. I do not think anybody has any good numbers.
    Mr. Foarde. Thank you. I know that my colleagues all have 
questions, so I am happy to yield the floor to someone else.
    Mr. Dorman. I next would like to recognize the Commission's 
General Counsel, Dr. Susan Roosevelt Weld.
    Susan.
    Ms. Weld. Thanks, Dave.
    I am interested in the ways in which Falun Gong prisoners 
are treated either like other prisoners or differently. I 
wonder if any of you have statistics on the Laojiao--
reeducation through labor camps--which do not require a trial 
before people are sentenced to them. What percentage of the 
inmates in the laojiao system are Falun Gong practitioners who 
have been picked up for Falun Gong offenses?
    Mr. Xu. Since the information is blocked, we do not have an 
exact percentage. But I can give some examples. They have 
expanded the prisons, and spent a lot of money to expand the 
prisons after 1999, because with the imprisonment of so many 
Falun Gong practitioners, the cells were full. That is one 
example.
    Ms. Weld. What evidence do you have of the expanded 
prisons? Is it just size of population or the actual area of 
the prisons, or the kinds of labor?
    Mr. Xu. Expanding scales of prison size and incorporating 
Falun Gong practitioners.
    Ms. Weld. Thank you.
    Mr. Wu. According to Chinese law, the laojiao is not a 
prison, so they are not prisoners. So if an American wanted to 
visit a prison, they would say, no, this is the facility of 
some institution, not a prison. They would say that this 
facility exists out of consideration. I myself spent 19 years 
mostly in a laojiao prison, with no trial, no papers. That is 
it. Today, the estimated number of laojiao prisoners is 
probably, at a minimum, 300,000. The higher estimate is a half 
million. If we take the middle number, it is about 400,000, and 
probably 15 percent of these prisoners are Falun Gong 
practitioners.
    Ms. Weld. Fifty percent?
    Mr. Wu. Fifteen percent of them. It is probably around 
60,000, concentrated in certain provinces. They particularly 
focus on certain provinces, such as: Shandong, Liaoning, 
Heilongjiang, Henan, Hebei, and Shaanxi. These reeducation 
camps are full of Falun Gong practitioners.
    Ms. Weld. Very quick follow-up. Are the Falun Gong inmates 
segregated from other inmates and subject to different kinds of 

treatment?
    Mr. Wu. Yes. The Chinese Communist Government has a 
different policy for Falun Gong practitioners. The policy 
directive from the former president, Jiang Zemin, is that if a 
Falun Gong practitioner is killed, he should just be buried. 
Also, another policy is to deprive Falun Gong practitioners 
economically and defame them.
    The main purpose for putting Falun Gong practitioners into 
labor camps is, as the authorities call it, reeducation. They 
try to convert them, force them to give up their beliefs. You 
can hear many cases about torture, and the purpose for this 
torture is to force them to give up their beliefs.
    Mr. Dorman. Good. Thank you.
    I would like to recognize, next, Pat Dyson, who is the 
Commission's Senior Counsel for Labor, and she is also the 
person who organized this roundtable.
    Thank you, Pat.
    Ms. Dyson. I want to thank all of you for coming and giving 
your testimony. It has been most useful. I wanted to ask Mr. Wu 
to describe what the working conditions are. We are all talking 
about forced labor, but how many hours are people required to 
work? What are the safety conditions? What are the results on 
people's health and welfare when they have gone through four or 
five years of this process?
    Mr. Wu. Number one, it is a national policy that all 
prisoners are forced to work. The purpose for this is not only 
to make a profit to support the government, support the regime. 
This is a way that the government supposedly helps you to 
``reform.''
    The first day you arrive at the camp, the warden will say, 
``Do you know how you have become a criminal? We are going to 
help you.'' Is your sentence 5 years, 10 years? Not only will 
you receive punishment, but you have to engage in hard labor, 
or else you never can become a ``new socialist person.'' So 
this is not something to punish you, and it doesn't matter 
whether you like it or do not like it. You have to do it. If 
you do not engage in the hard labor, they say, ``Well, how can 
I help you? '' So this labor is a kind of offer from the 
government. You have to do what they say.
    Number two, there is no other country in the world where 
the prisons are enterprises. This practice of prison 
enterprises is not carried out just occasionally, or 
temporarily, or locally somewhere. This is national policy.
    Each labor camp, except one prison, Qincheng Prison--
because this is a very special prison, for high-level, senior 
political criminals--chooses names, both enterprise names and 
prison names. It is true that they are enterprises. The Chinese 
call this the Special Enterprise System.
    Number three, except in ``Potemkin villages,'' except for 
these model camps for foreigners to visit, the situation in 
common prison camps depends on the nature of the camps. If it 
is an agricultural camp, in the wintertime the labor is slow 
because there is nothing to do in the fields, and because other 
agricultural camps have stopped their work.
    Mostly, like me, we were digging a canal in the winter or 
repairing the roads. In the summertime, you work for a very 
long time. When the sun rises, you just go to work. When the 
sun is setting, you come back. There is no time out for rest. 
Sometimes, when you are harvesting the crops, you are working 
for a longer amount of time. This is in agricultural camps.
    As for the other camps--for example, the coal mine--I 
worked in a coal mine for nine years, from 12 o'clock to 12 
o'clock, two shifts a day. And I also worked long hours in a 
chemical factory, from 12 o'clock to 12 o'clock, two shifts a 
day. Today, there is a very special policy, the so-called 
``accumulate your score'' policy. According to this policy, if 
you work hard, you earn points. There is a daily quota for 
every laborer. If you work hard and you have done your job, 
then you earn points.
    If you accumulate points, they can reduce your sentence, by 
three months, or six months, or maybe give you a favor so that 
you can buy more food, or your family can come to visit you, 
and they have a special place where you can stay with your wife 
during the night because you work hard. Because today they 
really are talking about profit.
    Mr. Fiedler. There is nobody that we know of on the outside 
enforcing any conditions that we would normally think 
appropriate. There is famous footage that Harry took in the 
early 1990s in the Qinghai Hide Factory, which is a prison, of 
a prisoner standing half-naked in a vat of chemicals tanning a 
hide. In the United States, we do not tan many hides any more 
because the chromium tanning process is so toxic. We send most 
of our hides to China, actually. But there is nobody checking 
these conditions. They clearly vary, but nobody really knows, 
except for ex-prisoners who have suffered them recently.
    Mr. Dorman. Good. I would like to recognize, next, CECC 
Senior Counsel Carl Minzner for five minutes.
    Mr. Minzner. Thank you very much. I have to confess, I am 
not an expert in criminal or labor law, so this is definitely a 
very useful experience for me to be able to listen to you. Just 
from listening to your testimony, it sounds like you are 
describing the problem of forced labor in China as a two-part 
problem. On the one hand, it sounds like the central leadership 
has made a decision that it is permissible to use severe 
punishment and abuse of political prisoners, particularly of 
groups such as the Falun Gong.
    Second, it sounds like you are also describing a highly 
decentralized system in which each camp has significant 
incentives, particularly financial incentives, to make money 
and significant leeway to compel prisoners to engage in forced 
labor in order to generate profits for the camp staff.
    All of you have very eloquently talked about the first 
point. I wondered if you could explore the second point a 
little bit more. Particularly, what are the incentive 
structures that the individual prisons operate under?
    Are there quotas that are sent down on how much should be 
produced? Who keeps the money that results as a result of the 
products? Perhaps if we can understand what the incentives are 
in the individual camps, it might help us think more about how 
to address them.
    Mr. Fiedler. Can I start on that? In the prison literature 
from the government journals and some of their reports, prisons 
brag about how much money they kick upstairs to the central 
government. So, there is some number of dollars, X  percentage, 
that may go to the central government. The rest stays in the 
system. They have got a budget to operate the place. I do not 
know how many of you have done budgets, but I have never seen a 
budget that was not manipulated in some way.
    So, they run the place on X number of dollars, then there 
is money left over for themselves, and their families, and 
their friends, and the companies that they are dealing with.
    We have no idea what the financial relationship is between, 
for instance with the binder clips, the private company paying 
and what the kick-back was to the warden for providing the 
female prisoners. So suffice it to say, some people have 
criticized and said, ``Well, they are not really making a 
profit.'' Well, it depends. I mean, what is a profit? Profit at 
the end of the day is money left on the table, and there is no 
money left on the table because everybody else has taken it? I 
do not know.
    On the decentralization question, it is a national policy, 
as Harry said. It is a big country. It is hard to implement any 
national policy entirely. There is lots of leeway for people to 
do things. There was probably not a written national policy for 
torture, but I would not say that torture is the result of 
decentralization of the Laogai system.
    Mr. Wu. The financial system in the prison camps is divided 
into different time periods. For 30-some years, under the Mao 
time period, it was entirely what was called a ``planned 
economy'' system.
    At that time, everything was planned by the government, the 
local government, the provincial government, and whatever the 
profit, it was given back to the government as planned. The 
policemen made a fixed salary. They did not receive any bonus, 
just their salary. I was in a prison camp at that time, and in 
the prison camp there was no bonus for the prisoners at all. 
Prisoners simply had to work. Most of the work was primitive 
labor. There was no cost, so you could never figure out the 
output.
    After Deng Xiaoping came into power, there was a new time 
period of probably 10 to 15 years, under which a new system was 
implemented, called the ``market economy'' system. Each prison 
camp enterprise became an independent financial unit that made 
money. Police were given a salary and benefits, and the 
maintenance of the facility was funded by its production 
profits.
    If production was going well, the police could make a lot 
of money. They therefore wanted to encourage prisoners to work 
hard. They gave the prisoners a kind of bonus, a small amount 
of money.
    So, for example, there was a prison in Anhui Province. It 
was a pretty old industrial factory, making textile products, 
with very old machines. They could not renovate the machines, 
and the quality of their products was pretty bad. They could 
not earn much money, and then they went bankrupt. The local 
government said, ``You do not have money, and I am not going to 
pay your salary.''
    Some police in the prison camps were pretty wealthy because 
their products are produced for export, for the market, and 
they sold very well. They made a lot of money--double, maybe 
triple their monthly salary.
    This one, a textile prison camp, had no money, so the 
police had no money each month. They were suffering. Then they 
had a new order. They said, ``We will now gather 1,500 
prisoners, and another 500 prisoners, and another 500 police 
families together in a big meeting and say, ``We have a new 
policy. Everybody listen. I do not care who you are, whether 
you are a policeman or you are a prisoner. If you can offer me 
an opportunity to make money, I will take it. I will follow 
you.'' Then one person says, ``I can do it. I can offer you an 
opportunity.'' Then she offers something.
    The next day, this prisoner was taken out of her cell, and 
she was assigned to be a manager of the company, and then taken 
out of her prison uniform and accompanied by policemen out of 
the camp, in search of opportunities to make money. But the 
prison authorities were corrupt and the warden committed 
suicide because he violated the law.
    This caused big problems, because the whole security system 
is unstable. Some of the prison camps made huge amounts of 
money, and some of them suffered.
    Then Jiang Zemin came up with a new policy. Under this new 
policy, every warden, every police car over there, was given a 
certain payment. Under the so-called 3-3-4 system, 30 percent 
of the profit is given to the central government, 30 percent is 
given to the local government, and 40 percent remains in the 
prison for the benefit of the policemen. So if you earn more, 
it is to your benefit under this new system.
    Mr. Dorman. Good. Thank you very much. I would like to 
recognize Dr. Kate Kaup, the Commission's Special Advisor on 
Minority Affairs.
    Kate.
    Ms. Kaup. Thank you. I would like to follow up on a few 
questions that have already been raised, specifically on the 
conflict between implementation and existing laws and 
regulations. Clearly, implementation is a problem throughout 
China in a variety of policy arenas. But are there written 
regulations on the books for health and safety conditions in 
the Laogai system? Are there any kind of restrictions on the 
number of hours that prisoners are forced to work? Has the 
Chinese Government shown any willingness at all to discuss 
this, either with the United States or domestically?
    Mr. Wu. Oh, yes, they have a policy. Eight hours a day, six 
days a week. They can even enroll in a university and get a 
degree. Yes.
    Ms. Kaup. And are any of these regulations new or have they 
all been on the books for years?
    Mr. Wu. Just like the Chinese Constitution, all the time 
they had the articles there for the freedom of speech, the 
freedom of religion.
    Mr. Dorman. Thank you. Finally, I would like to recognize 
Adam Bobrow, a Senior Counsel on the Commission.
    Mr. Bobrow. Thank you, David. Thank you to all the 
panelists.
    Just a quick initial question for Mr. Wu. You mentioned 
that other countries where China might export some of these 
products have no laws on the books to prevent the import, or to 
make illegal the import, of prison labor product? That is true?
    Mr. Wu. Yes.
    Mr. Bobrow. So the United States is the only country that 
does.
    Mr. Wu. The only country. The British have a regulation. 
This is my favorite country because I am an American citizen. 
But some countries go pretty far. We even find Japanese 
companies that directly cooperate with prison camps in joint 
ventures, making tea. They do not care.
    Mr. Bobrow. In that light, I guess the problem is--and you 
can correct me if I am wrong--there is no way to tell the 
difference at the border between products made in prison and 
products not made in prison. Obviously, there is a serious 
amount of intermingling.
    Mr. Fiedler. They especially intermingled after Harry 
revealed the Shanghai Hand Tools factory exporting wrenches and 
stuff. The problem is not the evidence. The problem is not that 
they are intermingling. The problem is the will to develop a 
solution. So for instance, if we find evidence that the Chinese 
are intermingling, and therefore you cannot tell, what do you 
do? Let them continue to intermingle and con you? Or do you 
say, ``Tell you what, you cannot send us any hand tools at all 
because we cannot tell? We will get our hand tools from 
somewhere else.'' Then you have created an enormous amount of 
internal pressure among the legitimate hand tool manufacturers 
in China. They say, ``Hey, wait a second, government. Just for 
a couple of prison hand tools, you are going to mess up the 
entire hand tool industry in China? '' Now, does somebody think 
that is unfair? We are not putting anybody in jail here, we are 
just not letting them sell us any hand tools.
    So, we have sat back for, now, 13 years, and allowed the 
Chinese Government and the Chinese prison system to con us, 
based on our sort of silly standard. Oh, they are mixing them 
up. The head of Asbury Graphite in New Jersey, in 1995, 
admitted on national television that the graphite he was buying 
was made in a forced labor camp. He admitted it on camera, the 
7 o'clock NBC national news. Nothing ever happened to him. 
Graphite continued to come in because the U.S. Customs Service 
said, but we cannot tell the difference. It does not have a 
brand on it. Like, an apple does not have a brand on it either.
    So we said, ``Oh, can you do some forensic tests on it? '' 
They use a certain kind of graphite, by the way. The reason 
that they are getting it is because it is the only place in the 
country that produces this kind of graphite.
    There was testimony about brake rotors in a civil court 
case in Southern California where the person who imported them 
said, ``We did it.'' Nothing happened. We caught Columbus 
McKinnon, an upstate New York-based company, making chain 
hoists. We had photographs of the chairman of their board 
standing next to prisoners.
    The Customs Service investigated for two and a half years, 
referred it to a U.S. Attorney for prosecution, and the 
prosecutor turned it down because of the U.S. evidentiary 
problem. The Chinese Government built a new chain hoist factory 
in Zhejiang Province. The two places where you get chain hoists 
in China are two forced labor camps. So you think that it would 
occur to us, as a matter of policy, to say, ``Well, I will tell 
you what. We do not like your chain hoists. We will get them 
from Czechoslovakia, or somewhere, because you are mixing and 
matching, throwing `Double Pigeon' labels on it.'' I am 
offended. I really am offended by our lack of creativity. And I 
do not mistake it as a lack of creativity. I tag it as a lack 
of will on the part of our government to do anything about this 
problem. Sorry for the outburst.
    Mr. Wu. Can I add something?
    Mr. Dorman. Yes.
    Mr. Wu. It is a very difficult job for the Customs Service. 
I will give you a couple of examples. One is that of Diamond 
brand hand tools, wrenches. We found them in Texas. I went to 
China. I have all the photographs documenting the Zhejiang 
Province No. 2 Prison where they made the wrenches.
    But later it was difficult, because Diamond brand wrenches 
are very well-known around the world. I found these wrenches in 
London, in Toulouse, in Hong Kong, everywhere, because the 
brand name, just like McDonald's, like Gucci's, is very well-
known. Then the Chinese Government merged another two 
legitimate factories that produced the wrenches under the one 
brand, Diamond. It was a prisoner product. So you could not 
figure out that this one is made by prisoners, and this one is 
made by a legitimate factory. I can take you there and you can 
see it. It is a legitimate factory. That is one case.
    In a second case, I found boots, rubber boots, in Wal-Mart. 
It was a big shock. In Wal-Mart, K-Mart, and Home Depot. Also, 
I went inside China. I posed as a businessman. I went in front 
of the prison camp, I went to the sales department, I bought 
the boots, and I brought them back here. They were the same as 
the boots you could find in K-Mart, Wal-Mart, and Home Depot. 
But what can we do? Shall I name Wal-Mart? What is the 
evidence? Wal-Mart can deny it and say, ``We do not know.'' 
They came from a trading company located in Los Angeles. The 
source was different, but the product was exactly the same. I 
can show you which Wal-Mart I bought them from, and which 
prison camp in China that I bought them from. How can we take 
these people to court? I do not know. I am scared to death to 
do it.
    The other thing today, let me say it this way: the warden, 
the prison authorities, they are not able to choose 
professional workers or skilled laborers, because they are 
dealing with prisoners. They are dealing with peasants, maybe a 
teacher, maybe an old man. They have no choice. They do not 
hire people or interview people.
    So we have to be very clear. Most of this labor today in 
prison camps is primitive labor. They do not really make a lot 
of products. This is a very special situation today where 
people really do not need skills, and do not even need a 
facility. For example, they can just sit with a small bench and 
assemble artificial flowers. They do not need any skills. They 
do not need any knowledge. They can assemble toys, assemble 
Christmas lights, do processing work.
    Many today, in Guangdong and Fujian Provinces, are 
prisoners right now. But they are only doing a part of the 
processing, such as 1,500 prisoners in one prison camp, 
Jieyang. What are they doing? The design and cutting is done 
outside the prison camp. They only put a button on. You never 
know what is going on.
    So the major problem is ``what is the Laogai? '' Forced 
labor is a national policy. If this country can use these 
products, they will definitely continue with forced labor. It 
is their policy.
    Mr. Dorman. Good. Thank you.
    I have just a few more questions to begin the second round.
    Back to a theme from the first round of questions, and like 
then, I am looking for comments and insights based on your deep 
experience. One thing that the Commission has been watching 
closely is the Chinese Government's commitment to open an 
International Committee of the Red Cross office in Beijing.
    What is your sense of the impact this office will have when 
it opens? Will the ICRC find a more responsive Chinese 
Government in terms of prison visits and adding some 
transparency to this problem?
    Mr. Fiedler. Hopefully. I have great respect for the 
International Red Cross and I have little respect for the 
Chinese 
Government. So, it means it is all really up to the Chinese 
Government. You can have a very good International Red Cross 
representative there, and yet an uncooperative Chinese 
Government, and you are not going to accomplish much.
    Now, the fact that the Red Cross opens up an office, to 
some degree, confers legitimacy on the Chinese Government. 
Right? I mean, it makes everybody think wishfully that the 
situation is changing. I do not believe that the only criteria 
that we ought to set out for judgment on improvements in the 
Chinese system, even a major one, should be the presence of the 
International Red Cross.
    I think there are a lot of criteria, such as the existence 
of forced labor, the continued existence of torture, the 
continued lack of due process, the continued persecution of 
Catholics, Falun Gong, Protestants, or whatever. There are lots 
of other criteria that ought to be addressed as true measures 
of progress.
    Mr. Xu. I would like to comment on this ICRC office. I 
think it is a very good move. In opening this office, it will 
definitely monitor and put pressure on the Communist regime, 
and watch their behavior. Also, one suggestion. When you are 
dealing with the Communists, it is good to know, what is 
Chinese Communism?
    Recently, I read a series of articles from the Epoch Times. 
It is an editorial: Nine commentaries on Chinese Communism. It 
is very good and will tell you the nature of Chinese Communism. 
When you deal with them, it is better to look at that.
    Mr. Dorman. Good. Thank you.
    Another short question regarding current procedures 
regarding U.S. Customs. What is the procedure right now, if 
any, for providing information to U.S. Customs on prison labor 
products entering the United States? Is there a procedure?
    Mr. Fiedler. Procedure? Like, a formal, you fill-out-a-form 
procedure?
    Mr. Dorman. Telephone number to call?
    Mr. Fiedler. No, I do not believe so. I mean, in fairness 
to the Customs Service, they will take information any way you 
can give it to them: call them up, write it down, give them 
photographs. But the problem is not so much how it comes. The 
problem is that I do not think the Customs Service has actively 
solicited the information. I do not think that they are 
interested.
    I do not think, by the way--to be critical of Congress and 
the President--I do not know that there is any internal 
bureaucratic or political pressure for them to do so. So they 
are sitting back there saying, we will keep our heads down, and 
nobody is making any noise. Harry Wu has not gone into China 
again, because if he does he will do another 15 years. So, 
there is no pressure.
    Mr. Dorman. Good. Thank you.
    One final question, a quick question. I looked over your 
written testimony, and you point to the importance of current, 
accurate 
information on such practices. I have looked through Mr. Xu's 
written statement. Of course, I have Mr. Wu's Laogai Research 
Foundation handbook in front of me.
    Certainly without revealing sources or methods, can you 
give us a brief account of whether this information is current 
or not, or any other distinguishing features, that would be 
important, I think, for any government agency to take action.
    I am thinking in very general terms. Is most of this 
information based on first-person accounts of people who have 
been imprisoned in these sorts of facilities? What other 
sources do you use?
    Mr. Fiedler. Generally speaking, his information is largely 
on first person account as former prisoners, and family members 
of prisoners. Our information is based on a number of things, 
such as first person accounts, statistical information, Chinese 
documents, commercial data bases where the Chinese list these 
prisons, their addresses, their names, a lot of historical 
data. We have to be very careful. You will see some camps still 
listed in the handbook, and we say they are no longer camps, 
that they shut this place down. But we leave it in for 
historical purposes. I am sure that there are problems. We do 
not phone them up and poll them all, although that is not 
entirely a bad idea, if your Chinese language skills are good 
enough. We can scam them. We used to scam them inside China all 
the time. It is dangerous work. But there are a variety of 
sources for information.
    Mr. Wu. I want to briefly talk about the rubber boots case. 
This prison camp produces 8 million pairs of rubber boots every 
year. According to government documents, they are mostly for 
export, including to the United States and Japan.
    A couple of years ago, there was a deputy chief from a 
particular prison camp who defected. He escaped to Russia. I 
met him in Vladivostok. I interviewed him and collected all the 
information, written and by videotape. I turned it over to the 
Customs Service. In the Custom Service, there was a man named 
David Banner who interviewed this man in Moscow. Since then, 
nothing has happened. Unfortunately, the man was later forced 
by Chinese agents to return to China, and has now disappeared.
    The Falun Gong has offered lots of information, 
particularly regarding Christmas lights. Is Customs going to 
take care of it? This has been witnessed. A location has been 
established. The Customs Service says, let us talk to the 
Chinese authorities. I remember there was a bill passed by the 
House--John Foarde maybe knows about this--for $2 million for 
the Customs Service officials to stay in Beijing to take care 
of things. What have they done this year? I just want to know. 
They spend our money sitting in Beijing. What are they doing?
    I really care about the Memorandum Of Understanding. For 
example, according to the MOU, if America requests it, the 
Chinese have to, within a certain time period, respond and 
allow the Americans to visit the camps and investigate. But 
this never happens.
    Mr. Fiedler. By the way, I said in my written testimony, 
but did not say in my oral testimony, we should abrogate the 
MOU. It is meaningless. Once we abrogate the MOU, we can work 
on that. Why should anyone expect the Chinese Government to 
incriminate itself?
    I mean, it wants to keep its system going. We are asking, 
with a straight face, ``you give us the evidence so that we can 
criticize you or we can take action against you,'' I mean, it 
is nonsensical.
    Mr. Xu. To Mr. Dorman's question, mainly, our data was from 
personal accounts, Falun Gong practitioners that have been 
rescued to Western countries. They tell us their stories. There 
are between 200,000 and 1 million Falun Gong practitioners that 
have been sent to labor camps, and a lot of them, through the 
Internet, and also the telephone, release this information on 
their personal experiences to the outside.
    Mr. Dorman. Well, good.
    As always, the 90 minutes has flown by. We have more 
questions, but perhaps we can continue the conversation offline 
in the future.
    I, for one, have found this conversation very, very useful, 
and certainly am deeply appreciative of the fact that you have 
all come here and testified, and am particularly happy to see 
such a distinguished panel.
    So on behalf of our Chairman Senator Chuck Hagel, and our 
Co-Chairman Congressman Jim Leach, I will bring this roundtable 
to a close. And again, thanks to our three witnesses for 
testifying today and sharing their deep experience and 
knowledge on this subject. Thank you very much.
    [Whereupon, at 11:30 a.m. the roundtable was concluded.]


                            A P P E N D I X

=======================================================================


                          Prepared Statements

                              ----------                              


                     Prepared Statement of Harry Wu

                             JUNE 22, 2005

    While economic reforms have been implemented in China, political 
reforms have not been correspondingly carried out, and the Laogai 
system remains a critical factor in the Communist Party's ability to 
maintain political control. Efforts by the Laogai Research Foundation 
and other human rights groups to focus international attention on this 
system have resulted in the Chinese government dropping the term 
``laogai'' (reform through labor) from its official documents and 
replacing it with the word ``prison.'' This, as well as other 
pronouncements by the Chinese government in recent years, was designed 
to create the impression abroad that the Chinese system is similar to 
penal systems found in the West. However, as Chinese 
authorities emphasize, the function of reform through labor remains 
unchanged. Severe violations of human rights continue to take place in 
the Laogai system. The Laogai, just as the Gulag, is an obstruction to 
freedom and democracy. The Laogai is incompatible with freedom and 
democracy.
    The Laogai is not a dying institution as some have suggested. It is 
true that the composition of the camps has changed. In the past, the 
majority of criminals were jailed for political reasons, and the 
majority of today's inmates are incarcerated for more common crimes. 
Nevertheless, this does not indicate a fundamental change in the nature 
of the Laogai. To the contrary, the Chinese government's dependence on 
the Laogai as its primary tool of suppression is as strong now as it 
was in the days of Chairman Mao Zedong's rule.
    The Laojiao (re-education through labor) component of the Laogai 
was revived by Deng Xiaoping in the early 1980s, providing the 
Communist government with the right to arrest and detain dissenters 
without a formal charge or trial for a period of three years. Laojiao 
has since developed into one of the most commonly used tools for 
punishing and suppressing political and religious dissent, and is 
currently being used to suppress the Falun Gong movement.
    In recent years, Chinese authorities have sent thousands of Falun 
Gong practitioners to the Laogai, where many of them have faced and 
continue to face torture, beatings, starvation, and forced labor under 
terrible conditions. Meanwhile, petitioners who have traveled en masse 
to Beijing and other cities to air their grievances about the 
destruction of their homes, unemployment, or unfair treatment have been 
imprisoned in the Laogai. These petitioners have usually done nothing 
illegal, and the police officers who detain them are often given 
monetary rewards based on the number of people they detain.
    China has used lethal injection in its implementation of the death 
sentence since the late 1990s. This method of execution often takes 
place in hospitals. The Chinese government proclaims that this is a 
``civilized, progressive and humane'' way to execute criminals. 
However, with no checks and no transparency in the legal system, we 
have enough reason to believe that this method is abused and that 
lethal injection is often unjustly used toward the end of harvesting 
prisoners' organs. It is also very difficult for the outside world to 
learn about and therefore condemn executions that take place quietly in 
a hospital.
    The slogan for the Laogai remains ``Reform first, production 
second.'' Millions of Chinese in the camps still face the daily 
``reform'' components and political indoctrination, or brainwashing. 
Mental and physical abuse is common. The Chinese government, meanwhile, 
continues to refuse the International Committee of the Red Cross access 
to the Laogai.
    Regarding the ``production'' aspect of the above slogan, the dual 
penal and commercial role of the Laogai is affirmed by China's Ministry 
of Justice. In its 1988 Criminal Reform Handbook, the ministry states 
that the Laogai ``organizes criminals in labor and production, thus 
creating wealth for society.'' It has developed into diverse forms and 
plays an important role not only in the judicial but also in the 
economic arena. Our research and analysis shows that, as an institution 
within the Chinese communist regime, the Laogai has benefited 
tremendously from the opening of China to international commerce. 
International trade provides the camps access to hard currency as they 
export their products--everything from socks to diesel engines, raw 
cotton to processed graphite. By trafficking its forced labor products 
in the international marketplace, the Laogai system has grown bigger 
and stronger. This material reinforcement of the Laogai is happening 
despite the fact that the nature and scope of the system's abuses are 
becoming increasingly apparent to the world community.
    Due to strong resistance from Western nations against forced labor 
products, in 1991 China's State Council re-emphasized the ban on the 
export of ``forced labor products'' and stipulated that no prison is 
allowed to cooperate or establish joint ventures with foreign 
investors. However, the State Council's move was merely a superficial 
one, and prisoners today still produce forced labor products in great 
numbers. The Chinese government grants special privileges to 
enterprises using labor camps and prisons, to encourage and attract 
foreign investment and export. Prisoners are forced to manufacture 
products without any payment, and are often forced to work more than 10 
hours a day and sometimes even overnight. Those who cannot fulfill 
their tasks are beaten and tortured. The forced labor products these 
prisoners produce are exported throughout China and the world.
    Dictatorships throughout history have used mechanisms of fear and 
control to maintain the absolute power of their regime and annihilate 
political dissent. Hitler built the concentration camps of the 20th 
century not only to terminate the Jews but also to destroy his 
political opposition. Lenin began building labor camps right after the 
Russian Revolution to punish the anti-Bolshevik ``unreliable elements'' 
in 1918. His heir Stalin threw tens of thousands of Russians of 
different nationalities into the Gulag after the Great Purge that took 
place in the 1930s. Labor camps also played a significant role in the 
Soviet Union's industrialization at that time. Gulag prisoners were 
used as a source of infinite manpower to excavate the natural resources 
throughout the vast nation.
    The Laogai, modeled after its Soviet counterpart, the Gulag, was 
established under Mao Zedong to serve as an instrument of political 
control for the newly empowered Chinese Communist Party. A combination 
of forced labor and regimented thought reform were to be the methods of 
reforming ``counterrevolutionaries'' and ``reactionaries'' from the 
former Chiang Kaishek regime into ``new socialist beings.'' People were 
thrown into camps not because they were criminals but because they had 
been categorized into ``bad'' classes, as landlords, rich peasants, 
counterrevolutionaries, ``evil'' elements, rightists, etc. People were 
labeled as ``criminals'' because they or their parents belonged to 
these classes.
    An examination of the Laogai in both theory and practice reveals a 
system that is fundamentally different than other systems of crime and 
punishment. Regardless of any reduction of the ratio of political 
prisoners to other prisoners in recent years or of the claims of the 
Chinese government regarding improvements in the conditions in the 
Laogai and in the Chinese judicial system, the theories that form the 
basis of the Chinese system pre-determine certain conclusions regarding 
its function, its methodology and its ideology.
    In the fifty years since the creation of the Laogai, little of its 
organizational structure has changed. The Laogai system, despite minor 
modifications in regulations, is still governed by the same directives 
that were issued under Mao. These policies have led to three distinct 
categories of incarceration: Convict Labor-Reform (Laogai), Reeducation 
through Labor (Laojiao), and Forced Job Placement (Jiuye).
    Today, more than a quarter century after Mao's death, the Laogai 
system still thrives, and an untold number of prisoners continue to 
suffer behind the high walls and the barbed wire fences of more than 
1,000 Laogai camps. A majority of the inmates currently in the Laogai 
are incarcerated for reasons that have little to do with politics or 
class background; however, the Laogai still serves its political 
purpose. Individuals deemed to be threats to China's one-party system 
may be held for ``crimes against state or public security'' or 
``revealing state secrets,'' or for offenses that have the ring of more 
common crimes, such as hooliganism or arson, that actually mask 
politically motivated incarceration. Additionally, the general lack of 
due process in the Chinese legal system victimizes countless 
individuals. Well-documented reports of several human rights 
organizations have revealed a system where individuals are often 
convicted and sentenced with no trial at all. Even when an individual 
is able to secure their right to trial, they are often refused the 
right to adequately defend themselves, or they are convicted through 
``evidence'' that was extracted through torture.
    The Criminal Procedure Law of 1979, along with the Revised Criminal 
Procedure Law of 1997, have proven inadequate both in content and 
implementation. The ``legal reform'' that came about in 1978 and became 
more agitated in the 1990s did indeed bring some changes to the 
judicial field. The procuratorate, arbitration, notarization, and 
attorney systems were revised. Hundreds of laws and regulations were 
reviewed and reformed, and new laws were promulgated. Theoretically, 
there are now more managerial mechanisms in the judiciary than before, 
since the National People's Congress set up a supervisory organ to 
carry out supervision in the judicial area. However, everything must 
still follow the main principle of acting ``in favor of the leading 
role of the Communist Party.'' The fact that in the year 2001 China had 
more judges (130,000) and prosecutors (159,638) than lawyers (100,198) 
reflects the phenomenon of the unbalanced public and private legal 
situation in the country.
    The recent ``legal reform'' launched and touted by Chinese 
authorities has received a wide range of international assistance from 
European countries and the United States. This assistance has provided 
many public servants, such as prosecutors, public security officers, 
and wardens, the opportunity to go abroad to learn from Western 
countries' legal systems. Yet these better trained legal servants lack 
both the ability and the will to help their poor and underprivileged 
Chinese compatriots when they return to China.

                         HISTORY OF THE LAOGAI

    The initial conception of the Laogai was not a Chinese innovation, 
but was actually passed down to China from the Soviet Union, where the 
Soviet Communists had already formed the Gulag, the predecessor of the 
Laogai. This cooperation originated in a defense treaty signed by the 
Soviet Union and China in 1950 whereby the Soviet government agreed to 
lend aid to China and to assist in the development of certain basic 
institutions of society, including the Chinese penal system, to be 
modeled directly after the Gulag. This tutelage led to the early years 
of the Laogai, and to a blending of the tenets of both the Chinese and 
the Soviet philosophies of reform through labor to form what is known 
today as the Laogai.\1\
---------------------------------------------------------------------------
    \1\ Leong, Albert. Gulag and Laogai. Eugene: University of Oregon 
Press, 1999.
---------------------------------------------------------------------------
    During the early years of the Laogai, many prisons dedicated much 
of their labor force to massive state-run reconstruction projects that 
would have been impossible to undertake through the labor of the 
Chinese people at large. So it was that millions of Chinese prisoners 
came to labor on the massive irrigation, mining and dam building 
projects that were carried out during the Great Leap Forward at the end 
of the 1950s. The most infamous of these projects took place in the 
more remote provinces, such as Gansu, Guizhou, Xinjiang and Tibet. In 
numerous camps in these areas, prisoners were forced to work at 
projects to reclaim wastelands and to 
unearth dangerous mines. Due to the treacherous conditions and the 
famine that resulted from the disastrous policies of the Great Leap 
forward, hundreds of thousands perished in China's prisons during this 
time.\2\
---------------------------------------------------------------------------
    \2\ Jasper Becker. Hungry Ghosts: Mao's Secret Famine. New York: 
Henry Holt and Co. 1996.
---------------------------------------------------------------------------
    During the earlier years of the Laogai's existence, the proportions 
of political prisoners confined in its facilities were greater than 
they are today. Due to the massive and unending political campaigns of 
the 1950s and 1960s, there remained a constant influx of 
counterrevolutionaries who were forced to join common criminals serving 
time in the camps. During the 1950s, it is estimated that up to ninety 
percent of those serving sentences in the Laogai were initially 
arrested for political reasons. This number declined slowly but 
steadily during the sixties and seventies, but due to continuing purges 
and to the horrors of the Cultural Revolution, it was not until the 
1980s that the ratio dropped down to approximately ten percent. Public 
Security Bureau documents state that in 1985, 10 percent of those 
detained in Labor Reform Prisons (excluding Laojiao and Jiuye) were 
counterrevolutionaries and 1.8 percent were historical 
counterrevolutionaries.\3\ These numbers may have changed slightly 
since 1985, but it is impossible to calculate a precise estimation with 
a lack of official documents.
---------------------------------------------------------------------------
    \3\ Hongda Harry Wu. Laogai: The Chinese Gulag. Boulder: Westview 
Press, 1992.
---------------------------------------------------------------------------
    Because the reasoning for China's opening was motivated more by a 
desire to improve economic development than to achieve any development 
in the political system, the majority of laws written as a result of 
the opening related to economics and business and not to crime and 
punishment. There were, however, a small number of laws relevant to the 
prison system that emerged at this time. Among these, the Criminal Law 
of the PRC was among the most important. Signed into law in 1979, this 
law included guidelines on Laogai ideology, crime and punishment, the 
death penalty, and three different categories of political offenses. 
These categories include the following: crimes of counterrevolution, 
crimes of endangering public security, and crimes of disrupting the 
order of social administration. The law defines ``counterrevolutionary 
crimes'' as the following:

          ``All acts endangering the People's Republic of China 
        committed with the goal of over-throwing the political power of 
        the dictatorship of the proletariat and the socialist system.''

    When Deng Xiaoping came to power following Mao's death and hundreds 
of thousands of so-called counterrevolutionaries were rehabilitated, 
many thought the years of horror had passed. Although the era heralded 
by Deng the pragmatist brought an end to mass purges, statements of 
Deng Xiaoping also justified the suppression of political dissidents, 
such as the following:

          ``Under the present conditions, using the suppressive force 
        of our Nation to attack and disintegrate all types of 
        counterrevolutionary bad elements, anti-party anti-socialist 
        elements and serious criminal offenders in order to preserve 
        public security is entirely in accord with the demands of the 
        people and with the demands of socialist modernization 
        construction.'' \4\
---------------------------------------------------------------------------
    \4\ Deng Xiaoping Xuanji (Selected Works of Deng Xiaoping). 
Beijing: People's Press, March 30, 1979, pp. 87, 155, 333.

    The CCP, to this day, has also proven no more tolerant of dissent. 
Beginning with the brutal crackdown on those who participated in the 
Democracy Wall Movement of 1979, Deng set the rules for Chinese 
political life in the post-Mao era. Eventually, under Deng's 
leadership, Chinese authorities amended the Chinese constitution to 
abolish earlier guarantees of the rights to speak out freely, hold 
debates and put up wall posters. Authorities often do not think twice 
about suspending the legal guarantees that remain enshrined in the 
nation's constitution and laws. Against a backdrop of modernization and 
reform in Chinese corporate law, dissidents are still detained 
illegally, deprived of legal representation, tortured, and forced to 
labor and have their sentences extended for political reasons. In 
short, they remain the victims of a regime that does not respect the 
rule of law.
    Thus even as China moves toward further economic integration with 
the international community, the Chinese prison camp system retains its 
political function. According to the Chinese government document 
``Criminal Reform Handbook'' (approved by the Laogai Bureau of the 
Ministry of Justice in 1988):

          ``The nature of the prison as a tool of the dictatorship of 
        classes is determined by the nature of state power. The nature 
        of our Laogai facilities, which are a tool of the people's 
        democratic dictatorship for punishing and reforming criminals, 
        is inevitably determined by the nature of our socialist state, 
        which exercises `The People's Democratic Dictatorship.' The 
        fundamental task of our Laogai facilities is punishing and 
        reforming criminals. To define their functions concretely, they 
        fulfill tasks in the following three fields: 1. Punishing 
        criminals and putting them under surveillance. 2. Reforming 
        criminals. 3. Organizing criminals in labor and production, 
        thus creating wealth for society. Our Laogai facilities are 
        both facilities of dictatorship and special enterprises.''

    Several more legal reforms came in the 1990s, the most significant 
of these being the revised Criminal Code of 1997 and the Criminal 
Procedure Code of 1997. These two revised codes brought changes to 
certain provisions from the 1979 versions, although such alterations in 
language resulted in little progress in practice. For example, in the 
new law, the section from the 1979 law that was entitled 
``counterrevolutionary crimes'' was renamed ``crimes against state 
security,'' and the previously stated definition of 
counterrevolutionary laws was deleted from the provisions. However, the 
laundry list of political crimes remains within the law with few 
changes from its previous version. Far from indicating that activities 
previously considered ``counterrevolutionary crimes'' are now legal, 
this omission expands the scope of punishable acts to all those which 
fit the vague, undefined notion of ``endangering state security.'' 
Additionally, both the 1979 and 1997 versions of the Criminal Procedure 
Code included provisions for protection of rights to due process and to 
appeal in what appears on paper to be a law-abiding system of crime and 
punishment.\5\ Reports of human rights groups, governments and 
multilateral organizations everywhere document China's continuing 
failure to protect rights of due process for its citizens. In recent 
years, many reports have even stated that circumstances have 
deteriorated during the last few years as China has carried out 
crackdowns on groups such as Falun Gong, the China Democracy Party, and 
Internet authors who Communist authorities feel pose a threat to their 
power. Communist authorities have also recently cracked down on the 
large numbers of petitioners who have flocked to Beijing to seek 
justice for the loss of property due to construction projects, as well 
as for unfair employment practices and other grievances.\6\
---------------------------------------------------------------------------
    \5\ Lawyers Committee for Human Rights. Opening to Reform? An 
Analysis of China's Revised Criminal Procedure Law. New York: Lawyers 
Committee for Human Rights, 1996.
    \6\ See 2003 and 2004 reports from the U.S. State Department, 
Amnesty International, Human Rights in China, the Laogai Research 
Foundation and the Guancha web site, www.guancha.org in Chinese, 
www.cicus.org in English, published by the China Information Center.
---------------------------------------------------------------------------
    Despite recent societal advances in the People's Republic of China, 
the most troubling aspects of the Communist Party's leadership, such as 
the Laogai, still remain. With its roots in Mao's leadership, today's 
Chinese communist system is characterized by a massive bureaucracy that 
oversees the public ownership of the principal means of production, 
despite widely touted economic reforms. The Communist Party economic 
theory, whether espoused by Mao or Deng, posits that human beings are 
key instruments of production. While Deng loosened state control over 
certain aspects of Chinese people's private lives, he and his 
successors have continued to deny the Chinese people fundamental 
political rights such as the freedoms of speech, press, assembly, and 
association.
    The underlying rationale for China's forced labor camps remains 
political necessity. The primary purpose of the Laogai is not simply to 
maintain order in society or to punish criminals in accordance with the 
law, but to protect and consolidate the dictatorship of the Chinese 
Communist Party.

                             THOUGHT REFORM

    Perhaps the most unique aspect of the Laogai is the focus on 
thought reform (sixiang gaizao)Mirroring the enormous efforts of large-
scale thought manipulation of the Chinese population following the 
Communist takeover, thought reform has been an intrinsic part of the 
Laogai since its establishment. In October 1951, Premier Zhou Enlai 
stated at a national conferences to central government officials: ``Our 
thoughts have been either bandaged by feudalism or enslaved by 
imperialism . . . in order to serve the demands of our new China, we 
need to reform our thoughts constantly . . . thought reform is 
inevitable, if an intellectual wants to serve the new China and the 
people.'' On September 29 of that same year, Zhou had already given a 
five hour-long speech at Beijing University (Beida) with the topic 
``Regarding the reform of the intellectuals.'' Premier Zhou used his 
personal experience to persuade the students and teachers at Beida of 
the importance of correcting one's mistakes and reforming one's 
thoughts, stating that this was the only way to adjust an intellectual 
to suit to the socialist new China. After Zhou's speech, a movement of 
thought reform spread out among colleges and universities throughout 
the nation. Mao Zedong praised this campaign as a ``new phenomenon, 
worthy of being celebrated.'' Mao emphasized that: ``Thought reform, 
especially the thought reform of the intellectuals, is one of the most 
important conditions necessary to achieve real democratic reform and 
the step-by-step industrialization of our nation.'' \7\
---------------------------------------------------------------------------
    \7\ See Xiao Shu, ``Tianma de zhongjie-zhishi fenzi sixiang gaizao 
yundong shuiwei'' (The end of a heavenly horse--Some details about the 
thought reform movement of the intellectuals), http://www.boxun.com/
hero/xiaoshu/4_1.shtml.
---------------------------------------------------------------------------
    The tendency of Chinese authorities to emphasize the struggle of 
the majority to eliminate a tiny minority of enemies of the people 
remains prominent. The ongoing campaign against Falun Gong 
practitioners and members of various house churches in China 
illustrates this pattern. Struggles of this kind will drag on for 
months with hundreds and sometimes thousands arrested and sent to be 
re-educated. Meanwhile, the campaign will go on, reporting that while 
the masses continue their struggle, many individuals among the minority 
of enemies have been successfully reeducated, but the struggle must 
continue to eliminate the ``tiny, tiny recalcitrant minority'' of 
enemies that threaten the good of the people and the motherland.\8\
---------------------------------------------------------------------------
    \8\ Amnesty International, No One is Safe: Power, Repression, and 
Abuse of Power in the 1990s. New York: Amnesty International, 1996.
---------------------------------------------------------------------------
    Nowhere is this struggle more prominent than in the Laogai. While 
the intense political study sessions of the Maoist era are a thing of 
the past, prisoners must still repeatedly confess their crimes and 
provide self-criticisms, as the Chinese legal system still lacks a 
presumption of innocence. Prisoners are still stripped of their 
personal identity and reduced to accepting only the identity they can 
be offered through the Communist authorities. All criminals must 
renounce any political and religious beliefs that the state considers 
subversive. The Catholic priests, Falun Gong followers, and democracy 
activists trapped in the Laogai today must all confess their ``crimes'' 
against the nation, recant their beliefs, and undergo special 
reeducation classes, which according to recent reports may incorporate 
torture. Group humiliation is also a well-known tenet of Laogai thought 
reform patterns. Prisoners are turned against one another and are 
forced to criticize and sometimes even physically beat one another in 
struggle sessions. This again reinforces the isolation of the prisoner 
and the feeling that they will not become part of the group until they 
submit to the authorities and allow themselves to be ``re-educated.'' 
\9\ Even more common in contemporary China, however, is the melding of 
reform and labor to produce the desired results: the Chinese Communist 
Party squeezes out every available ounce of labor from its prisoners to 
prove that they are but tools at the mercy of the state.
---------------------------------------------------------------------------
    \9\ Robert J. Lifton. Thought Reform and the Psychology of 
Totalism. Chapel Hill: University of North Carolina Press, 1989. To 
read more about thought reform in the Laogai, see also the eight 
volumes of the Laogai Research Foundation's Black Series, a Chinese-
language series of political prisoners' autobiographies--information on 
this series can be found on the Foundation's web site, www.laogai.org.
---------------------------------------------------------------------------
                        COMPONENTS OF THE LAOGAI

    The Laogai Research Foundation has gathered evidence on the main 
components of the Laogai as defined by Chinese law, policies, and 
practices. The legal definition of the Laogai entails six main 
components: prisons (jianyu), reform-through-labor detachments (laodong 
gaizao dui or laogaidui), reeducation-through-labor facilities (laodong 
jiaoyangsuo or laojiaosuo), detention centers (kanshousuo), juvenile 
offender facilities (shaoguansuo) and the practice of forced-job-
placement (giangzhi jiuye or liuchang jiuye)In general, prisons and 
laogai detachments house ``convicts,'' prisoners who have received 
formal sentencing by the courts (due process and judicial independence 
in China notwithstanding)The distinction in the terms ``prison'' and 
``laogaidui'' originated in a 1994 Prison Law in which China's prison 
system was renamed, altering the term from ``Laogai'' (reform through 
labor) to ``prison.'' An article in the January 7, 1995 edition of the 
government-sanctioned Being Legal Daily (Fazhi ribao) revealed the 
reasoning behind this superficial change:

          ``Our renaming of the Laogai is what our associating with the 
        international community calls for, and it is favorable in our 
        international human rights struggle. Henceforth, the word 
        ``Laogai'' will no longer exist, but the function, character 
        and tasks of our prison administration will remain unchanged.''

    Reeducation-through-labor facilities, or laojiaosuo, house 
prisoners who receive ``administrative discipline'' and sentencing of 
up to three years by police or the courts with no formal trial. 
Detention centers are for ``convicts'' sentenced to short-term (usually 
less than two years') imprisonment by a court, those awaiting 
sentencing, and prisoners who are awaiting execution. Juvenile offender 
facilities are for adolescent ``convicts'' or reeducation-through-labor 
detainees. Finally, forced-job-placement personnel are subject to 
indefinite assigned labor at forced labor facilities as directed by the 
courts or the Laogai Department following the completion of their 
sentences. These prisoners are deemed ``not fully reformed'' and are 
therefore denied their freedom even after the completion of their 
sentences. This kind of extended imprisonment was widely practiced 
through the 1990s.\10\ Today qiangzhi jiuye has been largely abolished, 
but is still practiced in some regions.
---------------------------------------------------------------------------
    \10\ See Cheng Zhonghe, Forty Years in China's Inferno. Washington, 
D.C.: Laogai Research Foundation's Black Series, 2002. The author spent 
ten years in prison after he had already fully served his 20-year 
sentence. See also Palden Gyatso, Fire Under the Snow, The Harvill 
Press, 1997. Palden Gyatso, a Tibetan monk, stayed in prison for forced 
job placement for ten years after he had already fully served his 15-
year sentence.
---------------------------------------------------------------------------
    The Chinese Communist Party utilizes numerous forms of imprisonment 
under China's Public Security Bureau (PSB), the Ministry of Justice, 
and the People's Liberation Army. However, whether individuals are 
thrown into a prison (jianyu), a reeducation-through-labor camp 
(laojiao suo), a juvenile offender facility (shaoguan suo), a county 
detention center (kanshou suo), or are those inmates who have finished 
their sentences but are forced to remain in the camps as forced job 
placement (qiangzhi jiuye or liuchang jiuye) workers, all are equally 
deprived of their freedom. Whatever the Communist Party may wish to 
call them, they remain under de-facto imprisonment. Furthermore, it is 
only with rare exception that these prisoners--regardless of the 
pretext for their incarceration--are not forced to labor against their 
will. When it appears in this Handbook, the term Laogai is used to 
refer to all forms of imprisonment used by the Chinese Communist Party. 
The CCP maintains control over all of these entities, and depends upon 
each of them to sustain its power.

                      LAOGAI: REFORM THROUGH LABOR

    Only criminals who have been arrested and sentenced are confined to 
the Laogai prisons. All prisons include factories, workshops, mines or 
farms in which all prisoners are forced to labor. Each prison also has 
an alternate production unit name. It is very hard to say how many 
labor reform camps there are in each province or autonomous region with 
any certainty because of the secrecy with which the Chinese Communist 
Party enshrouds these camps. Never has the Chinese government allowed 
the Red Cross or any other international body to inspect conditions in 
the Laogai.
    According to testimony gathered by the Laogai Research Foundation, 
conditions vary from camp to camp and from year to year depending on 
the shift of ever-changing political campaigns. Certain basic tenets 
remain the same, however, as all prisoners are forced to labor, undergo 
thought reform and submit to prison authorities. Appalling conditions 
for laborers persist in many camps. LRF researchers have confirmed 
sites where prisoners mine asbestos and other toxic chemicals with no 
protective gear, work with batteries and battery acid with no 
protection for their hands, tan hides while standing naked in vats 
filled three feet deep with chemicals used for the softening of animal 
skins, and work in improperly run mining facilities where explosions 
and other accidents are a common occurrence. Political prisoners are 
commonly housed together with other prisoners, although there are 
numerous reports of the solitary confinement of political prisoners.
    Laogai prisoners are often forced to work extremely long hours, 
deprived of sleep and forced to take on a highly intensive workload. 
For instance, in 2001, prisoners at the Beijing Xin'an Female Labor 
Camp near Beijing were forced to work from 5 a.m. until 2 or 3 a.m. the 
next day to make toy rabbits.\11\ In another instance, some 10,000 
detainees at the Lanzhou Dashaping Detention Center and the Lanzhou No. 
1 Detention Center were forced to use their hands to peel the shells 
off melon seeds. While working outside, many of these detainees 
suffered frostbite, cracked and bleeding hands, damage to their teeth 
and the loss of fingernails. They were forced to squat on their heels 
to do this work continuously for more than 10 hours, with no pay. In 
2001, a Falun Gong practitioner and prisoner at the Lanzhou No. 1 
Detention Center was unable to finish his work quota because of the 
physical ailments he suffered as a result of the work, and was thereby 
tortured by prison inmates at the orders of a prison official. After 
suffering severe injury to his abdomen as a result of this torture, he 
died at the beginning of January 2002.\12\
---------------------------------------------------------------------------
    \11\ ``Investigation Reveals Production of Laogai Goods for 
Export,'' World Organization to Investigate the Persecution of the 
Falun Gong, reprinted in the Laogai Research Foundation's Laogai 
Report, 2003 Vol. I 1 No.4.
    \12\ Ibid.
---------------------------------------------------------------------------
    Reports of torture are common and include beatings with fists and 
cattle prods, exposure to extreme cold and extreme heat, sleep 
deprivation, shackling and starvation. Members of China's Uighur 
minority, among others, are frequent victims of torture in Chinese 
prisons. A 31-year-old activist from China's Uighur minority was 
tortured to death in the Chapchal Prison in Xinjiang Province in 
October 2000.\13\ According to the Tibet Information Network, during 
the 1990s, nuns imprisoned in the Laogai in Tibet had a one in twenty 
chance of being raped or killed while in prison.\14\
---------------------------------------------------------------------------
    \13\ Agence France Presse``Uighur Tortured to Death in Chinese 
Prison,'' October 24, 2000.
    \14\ Steven Marshall. Hostile Elements: A Study of Political 
Imprisonment in Tibet in 1987-1998, London: Tibet Information Network, 
1999.
---------------------------------------------------------------------------
    In 1994, the CCP responded to increasing international attention to 
the Laogai camps by officially changing the name of the camps from 
Laogai (reform through labor) to ``Jianyu,'' the Chinese term for 
prison. But as stated previously, this small change in semantics does 
nothing to change the essential nature of the camps, which continue on, 
in every other respect, just as they had prior to the change.

            ``REEDUCATION-THROUGH-LABOR'' (LAODONG JIAOYANG)

    Laodong jiaoyang, commonly abbreviated as ``Laojiao,'' serves as 
one of the most useful tools for the Chinese Communist Party in its 
constant efforts to silence critics and punish political prisoners 
without having to bother with legal proceedings. According to the 1957 
law which created Laojiao, it is an administrative measure of reform 
through forced labor designed to ``reform idle, able-bodied people who 
violate law and discipline and who do no decent work into new people, 
earning their own living; it is also made in order to further 
strengthen social order and enhance socialist construction.'' \15\ A 
1982 Chinese State Council circular to the Public Security Bureau 
titled ``Measures for Reeducation through Labor'' similarly refers to 
Laojiao as an ``administrative action for carrying out strict education 
and reform.'' This allows the Public Security Bureau to detain and 
sentence individuals for up to three years without any legal 
proceedings. A variety of agencies and individuals, from family members 
to employers to the police, can recommend, through a petition process, 
individuals to reeducation. Most often, local police determine a 
reeducation term.
---------------------------------------------------------------------------
    \15\ Law passed by the 78th meeting of the Standing Committee of 
the People's Congress on August 1, 1957. Promulgated by the State 
Council on August 3, 1957.
---------------------------------------------------------------------------
    Laojiao camps are not included in any official accounting of the 
number of prisoners in the Laogai system. By the same logic, those in 
Laojiao camps are not considered convicted prisoners and, as such, are 
not covered under the international treaties for treatment of 
prisoners, nor are the goods they are forced to manufacture covered by 
the bilateral agreements between the United States and Chinese 
governments banning trade in forced labor products.
    Reports by several other human rights organizations, including 
Amnesty International, Human Rights Watch, and LRF also document the 
continued use of the Laojiao system to arbitrarily detain both penal 
and political criminals alike.
    Evidence indicates a recent increase in the construction of Laojiao 
facilities, suggesting that the system has proven itself an effective 
muzzle for many individuals deemed hostile by the Chinese government. 
According to a 1997 report by the U.N.'s Working Group on Arbitrary 
Detention, published after the Group's trip to China that year, there 
are 230,000 persons in 280 Laojiao camps throughout the country. The 
figure represents more than a 50 percent increase over four years. At 
the end of 1993, the reeducation through labor population figure was 
150,000. A 1996 report issued by the Chinese Ministry of Public 
Security and obtained by a Taiwanese publication, indicates that as of 
September 24, 1996, there were a total of 1.78 million persons in 
Laojiao.\16\
---------------------------------------------------------------------------
    \16\ Li Zijing, Cheng Ming Monthly, November 1996, pp. 14-16. 
Excerpted in the January 1997 issue of Inside China Mainland.
---------------------------------------------------------------------------
                      JIUYE: FORCED JOB PLACEMENT

    One of the most blatant human rights abuses of the CCP is 
``Jiuye.'' According to Chinese government regulations and criminal 
theory, a prisoner who is deemed to be ``not well reformed'' or a 
recidivist may be forced to remain indefinitely in the Laogai camp in 
which they completed their sentence. Chinese law stipulates that the 
following individuals should be subject to Jiuye:

          ``Criminals who are not well reformed should usually undergo 
        forced job placement in the camp. They include: important 
        counterrevolutionaries . . . who show no evident signs of 
        repentance during their terms and may revert to crimes after 
        completing their terms, and assaulting the socialist system, 
        vilifying the Party's line, principles, and policies . . . 
        seriously violate reform regimen . . . those who consistently 
        refuse to labor, or deliberately sabotage production and do not 
        correct themselves despite repeated admonitions.'' \17\
---------------------------------------------------------------------------
    \17\ Decisions on handling fugitive and recidivist criminals and 
reeducation-through-labor personnel'' adopted by the 19th session of 
the 5th Standing Committee of the National People's Congress, June 10, 
1981.

    Forced Job Placement is an applied system without clear judicial 
regulations. There is no strict definition of the targeted groups or 
individuals--it is a prolonged laogai system. Hundreds of thousands of 
``criminals'' have been detained indefinitely in laogai farms, mines or 
factories to produce wealth for the state. Hundreds of accounts of the 
implementation of these inhumane regulations can be read in the memoirs 
of Laogai prisoners.\18\
---------------------------------------------------------------------------
    \18\ Many autobiographies have been written by former Laogai 
inmates--see the eight-volume Black Series of the Laogai Research 
Foundation, Washington, D.C. 2001-2004.
---------------------------------------------------------------------------
                        JUVENILE OFFENDER CAMPS

    In accordance with Communist regulations, juvenile offender camps 
are organized on provincial, municipal, and autonomous regional levels. 
Statistics show that there are now a total number of approximately 50-
80 such camps, with a total prisoner population of approximately 
200,000-300,000. These numbers do not include those juveniles who have 
been sent to Laojiao and prison facilities.
    All juvenile offenders are forced to labor like other prisoners and 
are organized along the same lines as their older counterparts.\19\
---------------------------------------------------------------------------
    \19\ Hongda Harry Wu. Laogai: The Chinese Gulag.
---------------------------------------------------------------------------

      THE LAOGAI ECONOMY AND FORCED LABOR IN CHINA'S LAOGAI SYSTEM

    The Laogai remains the most extensive and secretive network of 
forced labor camps operated by any country in the world. The slogan for 
the Laogai remains ``Reform first, production second.'' Millions of 
Chinese in the camps still face the daily ``reform'' components and 
political indoctrination, or brainwashing. Mental and physical abuse is 
common. The Chinese government, meanwhile, continues to refuse the 
International Committee of the Red Cross access to the Laogai.
    Regarding the ``production'' aspect of the above slogan, the dual 
penal and commercial role of the Laogai is affirmed by China's Ministry 
of Justice. In its 1988 Criminal Reform Handbook, the ministry states 
that the Laogai ``organizes criminals in labor and production, thus 
creating wealth for society.'' It has developed into diverse forms and 
plays an important role not only in the judicial but also in the 
economic arena. Our research and analysis shows that, as an institution 
within the Chinese communist regime, the Laogai has benefited 
tremendously from the opening of China to international commerce. 
International trade provides the camps access to hard currency as they 
export their products- everything from socks to diesel engines, raw 
cotton to processed graphite. By trafficking its forced labor products 
in the international marketplace, the Laogai system has grown bigger 
and stronger. This material reinforcement of the Laogai is happening 
despite the fact that the nature and scope of the system's abuses are 
becoming increasingly apparent to the world community.
    Due to strong resistance from Western nations against forced labor 
products, in 1991 China's State Council re-emphasized the ban on the 
export of ``forced labor products'' and stipulated that no prison is 
allowed to cooperate or establish joint ventures with foreign 
investors. However, the State Council's move was merely a superficial 
one, and prisoners today still produce forced labor products in great 
numbers. The Chinese government grants special privileges to 
enterprises using labor camps and prisons, to encourage and attract 
foreign investment and export. Prisoners are forced to manufacture 
products without any payment, and are often forced to work more than 10 
hours a day and sometimes even overnight. Those who cannot fulfill 
their tasks are beaten and tortured. The forced labor products these 
prisoners produce are exported throughout China and the world.
    Today, more than a quarter century after Mao's death, the Laogai 
system still thrives, and an untold number of prisoners continue to 
suffer behind the high walls and the barbed wire fences of more than 
1,000 Laogai camps. A majority of the inmates currently in the Laogai 
are incarcerated for reasons that have little to do with politics or 
class background; however, the Laogai still serves its political 
purpose. Individuals deemed to be threats to China's one-party system 
may be held for ``crimes against state or public security'' or 
``revealing state secrets,'' or for offenses that have the ring of more 
common crimes, such as hooliganism or arson, that actually mask 
politically motivated incarceration. Additionally, the general lack of 
due process in the Chinese legal system victimizes countless 
individuals. Well-documented reports of several human rights 
organizations have revealed a system where individuals are often 
convicted and sentenced with no trial at all. Even when an individual 
is able to secure their right to trial, they are often refused the 
right to adequately defend themselves, or they are convicted through 
``evidence'' that was extracted through torture.
    During the early years of the Laogai, many prisons dedicated much 
of their labor force to massive state-run reconstruction projects that 
would have been impossible to undertake through the labor of the 
Chinese people at large. So it was that millions of Chinese prisoners 
came to labor on the massive irrigation, mining and dam building 
projects that were carried out during the Great Leap Forward at the end 
of the 1950s. The most infamous of these projects took place in the 
more remote provinces, such as Gansu, Guizhou, Xinjiang and Tibet. In 
numerous camps in these areas, prisoners were forced to work at 
projects to reclaim wastelands and to unearth dangerous mines. Due to 
the treacherous conditions and the famine that 
resulted from the disastrous policies of the Great Leap forward, 
hundreds of thousands perished in China's prisons during this time.\20\
---------------------------------------------------------------------------
    \20\ Jasper Becker. Hungry Ghosts: Mao's Secret Famine. New York: 
Henry Holt and Co. 1996.
---------------------------------------------------------------------------
The Laogai Economy
    Besides being an important part of China's public security and a 
tool of the dictatorship of the proletariat, the Laogai camps are also 
an integral part of China's national economy. Chinese authorities see 
the Laogai as a source of endless cost-free labor and are continuously 
studying the application of forced labor in increasing productivity and 
profits. Since the establishment of Deng Xiaoping's expansion and 
reform of China's export economy, the Communist Party has sought to use 
these state organs of repression to turn a profit. The use of forced 
labor in China is simply seen as another input into the economic 
equations of the Communist State. The deliberate application of forced 
labor by the Chinese government has spawned an entirely new field in 
China's economy: the economics of slavery.
    The millions in the Chinese Laogai constitute the world's largest 
forced labor population. While those in the Laogai face political 
indoctrination and physical and mental deprivation as part of the 
``reform'' regimen, they are simultaneously forced to labor and face 
production quotas in their ``labor'' evaluation. The universal slogan 
in the Laogai is ``Reform First, Production Second.''
    However, in recent years, the economic goals of the Laogai have 
come to supersede even the political aims. Production seems to have 
taken the place of reform as the ultimate goal. Laogai officials are 
more concerned with meeting production quotas and turning a profit for 
the Communist Party and for personal gain than with actually reforming 
the criminals serving time in the Laogai.
    In an opening essay of an official Chinese government document 
entitled, ``On the Present Conditions of Laogai Economics,'' the 
integration of the Laogai as one segment of the central government's 
economic program is laid out accordingly:

          ``In our nation, the Laogai economy is a branch of the 
        economy of specific 
        nature. Laogai economics has the dual characteristics of the 
        management of economic administration and the study of reform 
        through labor. In viewing the socialist ownership of means of 
        production under the control of the whole people it is a 
        component of the socialist national economy . . . Among Laogai 
        products, some are indispensable goods in the national plan and 
        the people's lives, some are used in national defense 
        industries; some special products which are made with Laogai 
        characteristics are welcomed by society; some have already been 
        named as national or provincial superior products; [and] some 
        have reached world-class, advanced levels. Some of the products 
        are even exported to various parts of the world, not only 
        earning large amounts of foreign currency, but also winning 
        praise for the state.'' \21\
---------------------------------------------------------------------------
    \21\ Gu Jianguo, Laogai Jingji Xue (Laogai Economics). China 
Railways Publishers: 1990.

    Chinese authorities carefully monitor labor production in the 
Laogai system to reward the most productive facilities and ``correct'' 
the poor performance of less productive facilities. Laogai enterprises 
participate in national evaluations to confirm that forced labor has 
---------------------------------------------------------------------------
reached certain standards. As stated in a 1991 Asia Watch report:

          ``The use of forced labor is a central government policy, not 
        one developed on an ad-hoc basis by labor reform units in the 
        coastal provinces where a large portion of the goods are 
        produced.'' \22\
---------------------------------------------------------------------------
    \22\ Prison Labor in China. News from Asia Watch report. April 19, 
1991.

    In a bulletin entitled The Demands of the Country's Condition--
Strength and Realities, the CCP expounded upon the need for the Laogai 
---------------------------------------------------------------------------
camps to be productive:

          ``Due to our national condition and strength, the country 
        cannot provide to the Laogai Departments all the expenses they 
        require. Because of this, it is extremely necessary that Laogai 
        Departments, while not influencing the reform of criminals 
        [i.e. not sacrificing the reform aspect of the Laogai system], 
        strengthen production and management administration, and 
        mobilize and expand prisoners' enthusiasm to labor and produce, 
        thus creating more wealth for the state through reform-through-
        labor.'' \23\
---------------------------------------------------------------------------
    \23\ The Laogai Research Foundation, June 30, 1999.

    The actual scope of the ``Laogai economy'' as a component of the 
overall Chinese economy is difficult to quantify using open sources. As 
the Laogai became a major issue in world condemnation of the Chinese 
dictatorship's disregard for basic human rights, documentation of the 
Laogai became scarce. The Chinese government considers information 
relating to the camps to be ``state secrets.''
    The Chinese government refuses access to the Laogai by the 
International Committee of the Red Cross to inspect conditions of 
political prisoners. Authorities also deny the U.S. Customs and Border 
Protection the right to inspect Laogai facilities suspected of 
importing their products to the United States, despite a binding 
bilateral agreement to allow visits to the Laogai for such purposes. 
The Chinese government rebuffs any attempts by foreign organizations or 
governments to independently inspect or study the dual political and 
economic role of the Laogai. For instance, in June 2004, China finally 
agreed to allow the first visit by U.N. Special Rapporteur on Torture 
Theo van Boven after about a decade of discussions, but then postponed 
the visit at the last minute, prompting criticism from human rights 
groups and others.\24\
---------------------------------------------------------------------------
    \24\ Agence France Presse, ``Bush asked to pressure China to allow 
U.N. probe on torture,'' October 5, 2004.
---------------------------------------------------------------------------
    Laogai administrators must adhere to the traditional emphasis on 
reform of prisoners in order to mold them into ``new socialist 
persons'' while reaching certain productivity and profit levels. The 
removal of direct government support for the Laogai pushes the drive 
for increased production and income for individual enterprises. This 
causes, however, a contradiction between the traditional role of the 
Laogai camps as centers of reform and the necessary role of the Laogai 
as producer in the ``socialist market economy with Chinese 
characteristics.'' In China's attempts to modernize the Laogai economy 
and to make products and production suitable for international 
progress, the aspect of ``reform'' has often taken a back seat to 
production, and even more than that, to profit.\25\
---------------------------------------------------------------------------
    \25\ Ibid.
---------------------------------------------------------------------------
    Given that the end result of the emphasis on production is for the 
Laogai enterprise to look for the greatest source of income available 
in the marketplace, it follows for those Laogai enterprises that have 
the highest quality production to make the ensuing move on to 
international markets through exports. Despite denials by Chinese 
government officials, Laogai products have time and time again been 
found to be available on the international market. In reality, the 
Chinese government constantly encourages the export of Laogai goods, as 
can be seen in the following excerpts from Chinese government 
documents:

          ``Laogai units, which develop foreign-oriented economies, not 
        only create large amounts of foreign currency for the state and 
        increase state revenues; the Laogai units themselves develop.'' 
        \26\
---------------------------------------------------------------------------
    \26\ Ibid.
---------------------------------------------------------------------------
          ``Laogai units which develop foreign-oriented economics push 
        their products into the international market [where they] not 
        only win praise for the state, but also increase the foreign 
        currency revenue of the state and accelerate the economic 
        construction of the state. Because of this, the development of 
        the Laogai economy itself or the development of the national 
        economy as a whole is absolutely essential.''
          ``To vigorously develop foreign-oriented economics whenever 
        it is possible and permissible is an important path to further 
        strengthening the Laogai economy, to accelerate technological 
        progress, to arm the Laogai management detachments, to fully 
        utilize the initiative and creativity of cadre guards, 
        employees and technical personnel, and to improve 
        qualifications of all categories of personnel to enhance the 
        impact and role of the Laogai economy.'' \27\
---------------------------------------------------------------------------
    \27\ Ibid.

    As a result of these policies, goods made by Chinese prisoners have 
time and time again found their way into U.Sand world markets. And 
countless unknowing consumers have purchased goods produced in China's 
forced labor camps.
    Most Laogai camps have two names: a public name (usually an 
enterprise name), and an internal administrative name. Yinying Coal 
Mine in Shanxi Province, for example, is the public name for the 
Yangquan No. 1 Prison. In carrying out the dual political and economic 
functions directed by Chinese Communist forced labor theory, individual 
Laogai facilities operate under distinct names for each of their 
identities. Laogai facilities may operate under multiple enterprise 
names in order to publicize their production and participate in the 
commercial arena, as well as to avoid detection by international 
observers. Furthermore, Laogai facilities may also operate under 
multiple internal names as designated by the Judicial Department in the 
course of implementing the ``reform'' of prisoners and central 
government edicts. For example, the Laogai with the commercial name 
Qingdao Shengjian Machine Works has two internal names: Lanxi Prison 
and Prov. No. 2 Prison.

Forced Labor
    The grueling, punitive forced labor component of the Laogai, aside 
from presenting a cruel means of physical punishment for prisoners, 
also provides a number of financial benefits for the Chinese 
government. Since the establishment of Deng Xiaoping's ``open'' China 
and the formation of China's ``socialist market economy,'' the Chinese 
government has sought to operate the Laogai at a profit. Goods made in 
the Laogai have become a part of China's domestic economy, and to an 
extent, Laogai-made goods are also filtering into foreign markets, 
including the United States.
    The theoretical basis of the Chinese Communist ideas regarding 
reform through labor have their roots in the writings of Marx and 
Engels as they were interpreted by the Soviets and then reinterpreted 
by Mao Zedong. Fundamentally, these theories promote the idea of 
criminals as exploiters who do not possess the ideology of the 
proletariat. In order to be stripped of their ``parasitical'' ideology, 
they must be taught to work, like the members of the proletariat, and 
then therefore take on their revolutionary ideology.\28\ As the Laogai 
became an institution of Chinese society, labor and production remained 
integrally tied to the function of ``reforming'' criminals. In the 
following directive, the Chinese Communist Party defends forced labor 
by prisoners:

    \28\ Harold Tanner. China Information, ``China's Gulag 
Reconsidered: Labor Reform in the 1980s and 1990s,'' Vol. 9, No. 2/3, 
Winter, 1994-1995.
---------------------------------------------------------------------------
          ``Our Laogai facilities force prisoners to labor. It is 
        determined by the nature of criminal punishment in our country, 
        by the dictatorial functions of our facilities and their aim of 
        reforming prisoners into new, socialist people. Our Laogai 
        facilities are both special schools for Laogai prisoners and 
        special state-owned enterprises.'' \29\
---------------------------------------------------------------------------
    \29\ Approved by the Laogai Bureau of the Ministry of Justice. 
Shaanxi People's Publishing House, 1988, pp. 132-133.

    According to Communist theory, the ultimate goal of forced labor is 
---------------------------------------------------------------------------
two-fold, production and reform:

          ``Laogai production serves as a means for reforming prisoners 
        and bears the political obligation of punishing and reforming 
        prisoners; it also serves as an economic unit producing goods 
        for society and bears the economic obligation set by guidelines 
        of the state. These dual obligations and dual accomplishments 
        (the reforming of prisoners into new men and the production of 
        material goods) must be advanced and practiced throughout the 
        entire process of Laogai production.'' \30\
---------------------------------------------------------------------------
    \30\ Gu Jianguo. Laogai Jingji Xue (Laogai Economics). China 
Railways Publishers, 1990, p. 31.

    Mao Zedong explains the role of forced labor in the Laogai in the 
---------------------------------------------------------------------------
following statement:

          ``Towards enemies, the people's democratic dictatorship uses 
        the method of dictatorship . . . [that] compels them to engage 
        in labor, and, through such labor, be transformed into new 
        men.''  \31\
---------------------------------------------------------------------------
    \31\ Mao Zedong Xuanji (Selected Works of Mao Zedong), Vol. 4, 
Beijing, People's Press, March 30, 1979, p. 371.

    As a result, the Laogai forces its prisoners to plant, harvest, 
engineer, manufacture, and process all types of products for sale in 
the domestic and international markets. The theory behind the Laogai is 
---------------------------------------------------------------------------
clear:

          ``Except for those who must be exterminated physically due to 
        political considerations, human beings must be utilized as a 
        productive force with submissiveness as the prerequisite. 
        Laogai units force prisoners to labor. The Laogai's 
        fundamental policy is, `Forced labor is the means, while 
        thought reform is the basic aim.'' \32\
---------------------------------------------------------------------------
    \32\ Laodong Gaizao Faxue, Beijing University Press, 1991.

    According to Article 74 of the The Law of Reform through Labor 
(zhonghua renmin gongheguo laodong gaizao liaoli, 1954), the financial 
sources of the labor camps are as follows: (1) the national budget 
appropriation; and (2) the revenue of reform-through-labor 
institutions. Article 8 of the Prison Law enacted in 1990 includes a 
---------------------------------------------------------------------------
regulation about the structure of prisons:

          ``The state ensures the necessary structure of reforming the 
        criminals in prison. All of the prison's budget for the 
        people's police, the costs of reform, the living costs of the 
        criminals, and establishment and other special costs should be 
        included in the state's budget plan. The state guarantees the 
        production equipment and cost, which is necessary for the 
        prisoners' labor.'' \33\
---------------------------------------------------------------------------
    \33\ See the Prison Law of the People's Republic of China, http://
www.xsjjy.com/flk/jyf.htm.

    Since the market economy has largely taken over the planned economy 
in China, the importance of ``labor reform'' has shifted. Forced labor 
is no longer the means but in terms of the economic aspects is now the 
goal in the Laogai system. The state's appropriations to the prisons 
are insufficient, so that local prisons now have to manage their 
finances on their own. There is an system of self-reliance in place in 
the Chinese prison system that puts prison authorities under pressure 
to produce, be self-sufficient and hold the prison compound financially 
intact. The author Qu Mo wrote an article in which he suggested that 
prisons and enterprises should be separated. The Beijing author first 
criticized the current situation in Chinese prisons, and then talked 
---------------------------------------------------------------------------
about prison reform:

          ``In the long-term range of implementation, organizing the 
        prison inmates to work becomes a means of production. `Create 
        economic profit' becomes the end goal of labor reform. Even the 
        income and living standard of the warden are directly connected 
        to the prisoners' productivity. `Reform' has taken a step back 
        and `create and gain' has been pushed to the front. This kind 
        of upside-down management has is greatly in error. Prison 
        authorities exert the greatest efforts in making use of the 
        prisoners' manpower, instead of caring for their reform and 
        education.''
          ``Judicial authorities have also taken notice of this 
        situation. From September 1 (2003) prison reform has been 
        started at six trial locations--in Heilongjiang, Shanxi, 
        Shaanxi, and Hubei provinces, as well as in Shanghai and 
        Chongqing. According to a People's Daily report, the final goal 
        of prison reform is to separate the function of law 
        implementation and enterprise management.''  \34\
---------------------------------------------------------------------------
    \34\ See Qu Mo, ``Gaobie `jianqi heyi' tizhi'' (Farewell to the 
combined system of `prison and 
enterprise'), original Chinese text, at: http://news.bbc.co.uk/hi/
chinese/china_news/newsid 3143000/31434901.stm.

    Liu Shi'en, a professor at the Central Legal Police Academy, also 
showed great concern about the unreasonable economic rules in prison in 
his article ``Some Thoughts on Prison Production after the Separation 
of Prison and Enterprise'' (Jianqi fenkai hou jianyu shengcha dingwei 
de sikao) \35\ on the web site of the Ministry of Justice. In this 
article, Professor Liu suggested strongly that prisons and enterprises 
should be separated. He stated that prison enterprises are incompatible 
with the market economy, as the market competition principles of prison 
enterprises alienate the principle of reforming and educating the 
prisoner. Also, he argued that prisoners, who lack professional 
training and on average have a low degree of education, are not ideal 
workers in terms of productivity.
---------------------------------------------------------------------------
    \35\ See Liu hi'en's article: http://www.legalinfo.gov.cn/moj/
zgsfzz/2004-07/26/content_119995. htm.
---------------------------------------------------------------------------
    After making a case that prisons and enterprises should be 
separated, Liu offered some thoughts as to how prison production could 
be better developed, as follows: (1) There should be more investment 
from the state and other enterprises or financing initiatives from 
society; (2) prison production should be limited to certain fields of 
processing, because this does not require much equipment and the 
management is simpler; (3) the state should offer low interest rate 
credit to prisons in terms of capital assets and circulating funds; (4) 
favorable tax regulations should be implemented for prisons; and (5) 
the government should buy back prison products. 
According to Liu, with all of these measures and state support, the 
prison would develop a more healthy system of production and labor.\36\
---------------------------------------------------------------------------
    \36\ Ibid.
---------------------------------------------------------------------------
                                 ______
                                 

                Prepared Statement of Jeffrey L. Fiedler

                             JUNE 22, 2005

    The United States negotiated a Memorandum of Understanding on 
Prison Labor in 1992 (MOU) with the People's Republic of China during 
the Bush Administration. The Clinton Administration then negotiated a 
Statement of Cooperation in 1994 (SOC). The texts of these documents 
are attached.
    These agreements have not stopped the illegal trade in forced labor 
products from China. In my view, the motives of successive U.S. 
administrations have been more political than aimed at stopping the 
illegal trade. Specifically, the first Bush Administration was seeking 
to defuse the issue of Laogai products within the context of the debate 
about continuing China's Most Favored Nation trading status. The 
Chinese government also shared the concern and thus agreed to negotiate 
an agreement when it would have otherwise ignored U.S. entreaties on 
the subject. It is more than a little interesting to note that the MOU 
and SOC fail to use the term ``forced labor'' but rather use ``prison 
labor.'' Words are important. The result of this was to leave the 
impression that the Chinese Laogai is similar to the U.S. prison 
system, an argument that was made repeatedly during the MFN debate. 
Nothing, of course, could be further from the truth.
    Revelations of continued forced labor product exports by the Laogai 
Research Foundation in the years after the MOU was signed, Chinese 
government stonewalling implementation of the agreement, and the fact 
that implementation was a ``must do'' condition for the renewal of MFN 
forced the Clinton Administration to take action. Unfortunately, the 
action was more cosmetic than substantive. The SOC was signed just 
prior to the President's decision to renew China's MFN status. The fact 
that they had signed the SOC was presented as evidence that the Chinese 
were ``cooperating.'' This struck us as cynical at the time, and 
history has proven us correct.
    The most fundamental, and fatal flaw in both the MOU and SOC is 
that U.S. efforts to use them to enforce our laws is dependent upon the 
willingness of the Chinese government to provide evidence incriminating 
themselves. No one in America would be expected to do so, and the 
Chinese communists who want to profit from this trade certainly will 
not.
    The reality is that U.S. attorneys are unwilling (and to a great 
extent, unable) to prosecute cases against American citizens based upon 
evidence gathered in China. The only exception to this is when another 
American citizen witness is willing to come forward to provide 
irrefutable eyewitness evidence. The Chinese Laogai camps and trading 
companies simply continue to do business only being forced to go a 
little further underground.
    Current U.S. law concerning forced labor products is directed at 
punishing U.S. importers who ``knowingly'' import these products. While 
this is certainly justifiable, the real goal should be to end forced 
labor in China. To this end, our law should be designed primarily to 
punish the mainland Chinese companies which engage in this illegal 
trade. Under current law they escape punishment almost entirely. We 
must create a series of significant disincentives in our law which 
would have the effect of forcing the Chinese government to end the 
illegal trade. Such laws would be compatible with WTO rules.
    By no means should we change the rules of evidence for prosecuting 
American citizens suspected of committing a crime. These thresholds 
should remain high. But, when it comes to providing the Chinese the 
right to send their products into the United States we should apply 
different standards, ones which recognize the reality of how easy it is 
for the communist government in China to circumvent and manipulate our 
legal system.
    Representatives of the Customs Service and State Department have 
repeatedly testified before Congress about the problems of obtaining 
Chinese compliance with the MOU and SOC. The GAO published a report in 
1995 detailing specific problems. Nothing has changed in the last 
decade. The agreements are effectively useless.
    We propose that the United States abrogate the MOU and SOC and the 
Congress enact new laws which would:

          1. Provide the Customs Service the administrative authority, 
        based upon solid intelligence information, to ban entire 
        categories of products from China if it is found that forced 
        labor products of the same type are being sent into the United 
        States. For example, if China is found to be sending in brake 
        rotors from a Laogai camp, Customs would have the authority to 
        ban all brake rotor imports from China for a set period of 
        time. We suggest that a three year ban would be an appropriate 
        period to create a strong disincentive. This would also take 
        care of the current problem of the Chinese mixing Laogai 
        products with legitimately produced products as a way of hiding 
        the former.
          2. Provide the Customs Service the administrative authority, 
        based upon solid intelligence information, to ban all imports 
        from the Chinese state trading company which cooperates in the 
        illegal importation of forced labor products. For example, if 
        MinMetals is sending in the brake rotors it can no longer do 
        any import business with the United States. We have similar 
        laws and regulations in effect for weapons proliferators. The 
        Chinese company known as NORINCO is currently under U.S. 
        sanctions which prevent it from exporting products to the 
        United States and ban their subsidiaries from operating here.
          3. Provide the State Department and/or the U.S. Citizenship 
        and Immigration Services the authority to revoke the business 
        visa of any PRC national working in the United States for a 
        company or any of its subsidiaries which has been found by the 
        Customs Service to be involved in the illegal trade in forced 
        labor products. The State Department should further be required 
        to deny the visa application of any PRC national from the 
        company sent to replace the ones required to leave the United 
        States. This would have the net effect of banning the company 
        from operating a business in the United States.
          4. Include in the legislation a ban on U.S. companies from 
        doing business (buying, selling or establishing joint ventures) 
        in China with any company or its subsidiaries or parents which 
        has been found by the U.S. Customs Service to be dealing in 
        forced labor products.
          5. The Customs Service should institute a financial reward 
        system for anyone who reports information to it regarding the 
        export of Laogai products to the United States. Payment of the 
        reward would be forthcoming only after the information is 
        corroborated by other sources. It is my expectation that 
        business people of all nationalities would provide information 
        concerning their competitor's illegal practices. More than the 
        money involved, such informants would likely have to be 
        convinced that the U.S. government is serious about ending 
        forced labor in China rather than simply appearing to be going 
        through the 
        motions.

    Some would object by saying we would be punishing legitimate 
companies in China. This is true, but the Chinese have historically 
used ``legitimate'' companies to traffic in forced labor products and, 
we believe it is the only way to create the incentive inside China to 
abide by our laws. It also is narrowly focused on those products which 
on a case by case basis are found to be made by forced labor.
    My proposal shifts the negotiating power to the United States in 
dealing with this problem, and replaces an empty diplomatic agreement 
with real tools of enforcement directed at the source of the illegal 
trade. It removes from the process dependence on the Chinese government 
for information implicating itself, and it provides the means to combat 
Chinese evasions which the United States is currently powerless to 
combat. It also potentially creates substantial pressure on the Chinese 
government to end the practice of forced labor itself, especially if 
the United States were to enlist other of China's trading partners in 
this effort.
    Thank you.

 MEMORANDUM OF UNDERSTANDING BETWEEN THE UNITED STATES OF AMERICA AND 
 THE PEOPLE'S REPUBLIC OF CHINA ON PROHIBITING IMPORT AND EXPORT TRADE 
                        IN PRISON LABOR PRODUCTS

    The Government of the United States of America and the Government 
of the People's Republic of China (hereinafter referred to as the 
Parties),
    Considering that the Chinese Government has noted and respects 
United States laws and regulations that prohibit the import of prison 
labor products, has consistently paid great attention to the question 
of prohibition of the export of prison labor products, has explained to 
the United States its policy on this question, and on October 10, 1991, 
reiterated its regulations regarding prohibition of the export of 
prison labor products;
    Considering that the Government of the United States has explained 
to the Chinese Government U.S. laws and regulations prohibiting the 
import of prison labor products and the policy of the United States on 
this issue; and
    Noting that both Governments express appreciation for each other's 
concerns and previous efforts to resolve this issue,
    Having reached the following understanding on the question of 
prohibiting import and export trade between the two countries that 
violates the relevant laws and regulations of either the United States 
or China concerning products produced by prison or penal labor (herein 
referred to as prison labor products).
    The Parties agree:

          1. Upon the request of one Party, and based on specific 
        information provided by that Party, the other Party will 
        promptly investigate companies, enterprises or units suspected 
        of violating relevant regulations and laws, and will 
        immediately report the results of such investigations to the 
        other.
          2. Upon the request of one Party, responsible officials or 
        experts of relevant departments of both Parties will meet under 
        mutually convenient circumstances to exchange information on 
        the enforcement of relevant laws and regulations and to examine 
        and report on compliance with relevant regulations and laws by 
        their respective companies, enterprises, or units.
          3. Upon request, each Party will furnish to the other Party 
        available evidence and information regarding suspected 
        violations of relevant laws and regulations in a form 
        admissible in judicial or administrative proceedings of the 
        other Party. Moreover, at the request of one Party, the other 
        Party will preserve the confidentiality of the furnished 
        evidence, except when used in judicial or administrative 
        proceedings.
          4. In order to resolve specific outstanding cases related to 
        the subject matter of this Memorandum of Understanding, each 
        Party will, upon request of the other Party, promptly arrange 
        and facilitate visits by responsible officials of the other 
        Party's diplomatic mission to its respective companies, 
        enterprises or units.

    This Memorandum of Understanding will enter into force upon 
signature.

    DONE at Washington, in duplicate, this seventh day of August, 1992, 
in the English and the Chinese languages, both texts being equally 
authentic.

    For the Government of the United States of America:
    For the Government of the People's Republic of China:

  STATEMENT OF COOPERATION ON THE IMPLEMENTATION OF THE MEMORANDUM OF 
  UNDERSTANDING BETWEEN THE UNITED STATES OF AMERICA AND THE PEOPLE'S 
                   REPUBLIC OF CHINA ON PROHIBITING 
            IMPORT AND EXPORT TRADE IN PRISON LABOR PRODUCTS

    1. Summary: The statement of cooperation on implementation of the 
prison labor MOU was signed at 09:00 LT in Beijing March 14, 1994. 
Ministry of Justice Reform Through Labor Bureau Director-General Wang 
Mingdi signed for the Chinese side, Econ Mincouns Szymanski signed for 
the U.S. side. This message contains the final text of the document as 
signed and a background document distributed at Secretary Christopher's 
press conference where the signing of the document was announced. End 
Summary.
    2. Final text of the statement of cooperation on implementation of 
the prison labor MOU, signed at 09:00 LT in Beijing March 14, 1994 
follows:

                               BEGIN TEXT

    As the Chinese government acknowledges and respects United States 
laws concerning the prohibition of the import of prison labor products, 
and the United States government recognizes and respects Chinese legal 
regulations concerning the prohibition of the export of prison labor 
products;
    As China and the United States take note and appreciate the good 
intentions and efforts made by both sides in implementing the 
``Memorandum of Understanding'' signed in August 1992;
    The Chinese government and the United States government agree that 
conducting investigations of suspected exports of prison labor products 
destined for the United States requires cooperation between both sides 
in order to assure the enforcement of the relevant laws of both 
countries. Both sides agree that they should stipulate clear guidelines 
and procedures for the conduct of these investigations. Therefore, both 
sides agree to the establishment of specialized procedures and 
guidelines according to the following provisions:
    First, when one side provides the other side a request, based on 
specific information, to conduct investigations of suspected exports of 
prison labor products destined for the United States, the receiving 
side will provide the requesting side a comprehensive investigative 
report within 60 days of the receipt of said written request. At the 
same time, the requesting side will provide a concluding evaluation of 
the receiving side's investigative report within 60 days of receipt of 
the report.
    Second, if the United States government, in order to resolve 
specific outstanding cases, requests a visit to a suspected facility, 
the Chinese government will, in conformity with Chinese laws and 
regulations and in accordance with the MOU, 
arrange for responsible United States diplomatic mission officials to 
visit the suspected facility within 60 days of the receipt of a written 
request.
    Third, the United States government will submit a report indicating 
the results of the visit to the Chinese government within 60 days of a 
visit by diplomatic officials to a suspected facility.
    Fourth, in cases where the U.S. Government presents new or 
previously unknown information on suspected exports of prison labor 
products destined for the United States regarding a suspected facility 
that was already visited, the Chinese government will organize new 
investigations and notify the U.S. side. If necessary, it can also be 
arranged for the U.S. side to again visit that suspected facility.
    Fifth, when the Chinese government organizes the investigation of a 
suspected facility and the U.S. side is allowed to visit the suspected 
facility, the U.S. side will provide related information conducive to 
the investigation. In order to accomplish the purpose of the visit, the 
Chinese side will, in accordance with its laws and regulations, provide 
an opportunity to consult relevant records and materials onsite and 
arrange visits to necessary areas of the facility. The U.S. side agrees 
to protect relevant proprietary information of customers of the 
facility consistent with the relevant terms of the prison labor MOU.
    Sixth, both sides agree that arrangements for U.S. diplomats to 
visit suspected facilities, in principle, will proceed after the visit 
to a previous suspected facility is completely ended and a report 
indicating the results of the visit is submitted.
    Both sides further agree to continue to strengthen already 
established effective contacts between the concerned ministries of the 
Chinese government and the U.S. Embassy in Beijing and to arrange 
meetings to discuss specific details when necessary to further the 
implementation of the MOU in accordance with the points noted above.
_______________________________________________________________________
    Done at Beijing, in duplicate, this Thirteenth day of March, 1 992, 
in the English and the Chinese languages, both texts being equally 
authentic.

    Representative of the Chinese side: Wang Mingdi
    Representative of the United States side: Christopher J. Szymanski

    3. The statement of cooperation was signed, for the Chinese side by 
Ministry of Justice Reform Through Labor Bureau Director-General Wang 
Mingdi and for the U.S. side by Econ Mincouns Christopher J. Szymanski.

                    Prepared Statement of Gregory Xu

                             JUNE 22, 2005

    Mr. Chairman, members of this Commission, ladies and gentlemen:
    Thank you for giving me this opportunity to speak on the plight of 
Falun Gong practitioners in China.
    We are grateful for the support this Congress has shown us during 
this difficult time. We are, however, sad to report that in the past 
six years, the persecution of Falun Gong in China has gone into a 
covert one but continued to worsen. Over the years, between 200,000 and 
1 million have been reportedly sent to forced labor camps without 
trials. The persecution methods used in such camps are extremely cruel, 
encompassing a wide variety of brutal tortures; and yet the Chinese 
government has imposed strict blockades in an attempt to conceal 
information and absolve its responsibility. The labor camps in China 
have the authority to imprison Falun Gong practitioners for as long as 
three years without any due process and can arbitrarily extend the 
terms of imprisonment at will.

                  I. THE LATEST CASUALTY OF LABOR CAMP

    Most recently, Falun Dafa Information Center(FDI) has learned that 
Ms. Gao Rongrong, whose face was grossly disfigured as a result of 
torture in Longshan Forced Labor Camp, was tortured to death on June 
16, 2005. Ms. Gao went through nearly two years of incarceration, 
brainwashing, and torture for her beliefs in Falun Gong. Her case even 
involved directives from Luo Gan, one of the standing members on 
China's Politburo.
    Ms. Gao, an accountant at the Luxun College of Fine Arts in 
Shenyang City, was stripped of her job in 1999, soon after Falun Gong 
met with suppression. Ms. Gao then lodged legal appeals with 
authorities in Beijing, calling for an end to the wrongful persecution. 
Authorities then, acting outside the law, detained Ms. Gao. In July 
2003, Ms. Gao was sent to Longshan Forced Labor Camp. On May 7, 2004, 
at approximately 3 pm, Tang Yubao, the deputy head of the No. 2 Prison 
Brigade along with team leader Jiang Zhaohua, summoned Ms. Gao to the 
office and began to torture her with an electric baton. The torture 
continued for about 7 hours, and the inmates in the labor camp said 
that Ms. Gao sustained multiple burns to her face, head, and neck. Ms. 
Gao's face was covered with blisters and her hair was matted with pus 
and blood. So severe were the injuries that Ms. Gao's face was 
disfigured and had difficulty of seeing things.
    In a desperate attempt to escape her torturers, Ms. Gao later 
jumped from the 2nd floor office window of the facility, sustaining 
multiple fractures. Subsequent hospitalization allowed those close to 
Ms. Gao to take photos of the injuries to her face and body. The 
shocking photos made their way overseas, where rights activists 
publicized them widely. Details of her case were submitted to related 
government offices in the United States and other nations, and were 
also presented to the United Nations.
    While hospitalized, Gao was under constant surveillance from the 
Chinese police. Authorities declared she would be returned to captivity 
upon release from the hospital. On October 5, 2004, however, Ms. Gao--
having recovered sufficiently to be moved--was able to leave the 
hospital with the help of a small group of friends, thus avoiding 
abduction by police and the possibility of further torture.
    During Ms. Gao's short escape between October 5, 2004 and March 6, 
2005, Falun Gong practitioners in the United States contacted the U.S. 
Department of State for rescuing Ms. Gao. Politburo Standing Committee 
Member Personally Oversaw Gao's Case.
    As international pressure mounted concerning Gao's case, one of 
China's highest-ranking officials stepped in: Politburo Standing 
Committee member Luo Gan. Luo proceeded to order the Liaoning Province 
Chinese Communist Party Political Judiciary Committee, the 
Procuratorate, the Department of Justice, and the Police Department to 
conceal any and all information about Ms. Gao's case.
    After Ms. Gao's escape, Shenyang City Police Department (State 
Security Division) began tapping the phones of all Falun Gong 
practitioners in the region, hoping to discover who had helped 
publicize Ms. Gao's case and secure her escape. A manhunt ensued, as 
all individuals believed to have facilitated Ms. Gao's hospital escape 
were ordered rounded up. One such individual who was abducted, Mr. Feng 
Gang had to be admitted to Masanjia Hospital after thirteen days of 
hunger strike protesting his unlawful abduction. Another individual, 
Mr. Sun Shiyou, is reported to have been severely tortured by 
authorities, including having his genitals shocked by electric batons. 
Mr. Sun's family members were also abducted.
    On March 6, 2005, Ms. Gao was located by police and again abducted. 
Neither her location nor her condition was revealed to family members 
until June 12; they learned she was being held at Medical University 
Hospital in Shenyang City. According to Ms. Gao's family, by the time 
they reached the hospital on June 12, Ms. Gao had lost consciousness, 
her organs were atrophying, and she was hooked up to a respirator. They 
say she was little more than ``skin and bones.'' Ms. Gao died four days 
later. Chinese police are now pressuring Ms. Gao's family to cremate 
her body quickly, trying to eliminate the evidence of torture.
    It was reported that Public Security Bureau agents closely guarded 
the room in which Ms. Gao was held at the hospital. The agents intended 
to prevent news of her condition and maltreatment from reaching the 
outside world; this fits a pattern of complicity that reaches to the 
highest levels of China's regime.

                II. FORCED LABOR IN CHINA'S LABOR CAMPS

    Ms. Gao's death is part of a disturbing pattern of systematic 
rights violations, systematic cover up, and zero accountability. And 
Ms. Gao is just the latest victim of China's forced labor camp system. 
The re-education-through-labor system has become a very effective tool 
of control and suppression in the past fifty years for the Chinese 
Communist Party's (CCP).
    According to WOIPFG (World Organization to Investigate the 
Persecution of Falun Gong), there are two direct purposes behind 
China's system of ``re-education-through-labor,'' firstly to create a 
reliable and cheap labor force through forced labor, and second to 
brainwash prisoners. This is the so-called ``reform one's mind through 
labor.'' This not only violates the basic human rights of the 
detainees, but also encourages the prison and labor camp systems to 
persecute the detainees because of the huge profit in products made 
through forced labor. In addition, it shakes the stability of 
international labor and trade markets when these cheap products are 
dumped on the international market. Many consumers buy the products, 
totally unaware of the reasons behind the cheap price.
    Since China's former president Jiang Zemin launched the persecution 
of Falun Gong in 1999, according to incomplete statistics, more than 
180 forced labor camps in China have directly participated in the 
persecution through illegal forced labor of over 200,000 Falun Gong 
practitioners. In addition to forced brainwashing and torture, China's 
labor camps also force a large number of Falun Gong practitioners to 
work as slave labors. Falun Gong practitioners have been made to work 
overtime shifts, subjective to punishment or deprivation of food or 
sleep if assigned quotas are not met, and tortured if they refuse to 
cooperate. They are often arbitrarily detained beyond their release 
dates because of the huge profits that camps stand to gain as a result 
of free labor. Practitioners are forced to work more than 10 hours a 
day, sometimes even continuously overnight. Because of the terrible 
working conditions and highly labor-intensive work, Falun Gong 
practitioners have all suffered various degrees of damage, both 
mentally and physically. Some have become disabled or even died. About 
30 percent of all the death cases of Falun Gong practitioners resulted 
from torture in labor camps. Sixty-nine labor camps have directly 
caused the deaths of Falun Gong practitioners, including elderly people 
in their 60s and an 8-month-old infant. Even women, children, or 
disabled practitioners were not spared.
    For example, Qiqiha'er Shuanghe Female Labor Camp is a processing 
site that has no government approved certificate for producing 
agricultural chemicals. Falun Gong practitioners are, however, forced 
to pack very toxic pesticide powders with no protective worksuits at 
all, which have caused serious physical harm to the practitioners. Many 
practitioners have had bleeding noses, others feel sick, vomit, have 
had severe coughs (there was blood in their phlegm) and abnormal 
bleeding; still others have nearly gone blind because the labor camp is 
filled with choking toxic pesticide dust. The victims are forced to 
continue their work even when they show symptoms of being poisoned. On 
the packages, it is clearly stated that in producing the pesticides 
there must be protective facilities and workers must take showers after 
work. However, there are no shower facilities in the chemical factory. 
In the hot summer, when the chemical dust and sweat mixed together, it 
would irritate the skin; as the sweat dried out, one could attain 
tinea-type skin ulcers. The victims would feel itchy and painful. The 
police would often forbid practitioners to wash, and therefore these 
practitioners have to go to bed with chemical dust all over their 
bodies.
    At one time, Falun Gong practitioners Zhang Guiqin, Qi Baiqin, Lin 
Xiumei and Jiang Yuehong refused to work to protest the persecution, 
but they were tortured for doing so. They were forced to `sit on iron 
chairs,' a form of torture where their hands were handcuffed from 
behind their back, their feet were put into two square holes and they 
were sandwiched between the back of the iron chair and an iron slab in 
front of their chest. They were tortured until their feet were swollen, 
their skin torn and flesh gaping or they lost consciousness. 
Afterwards, six Falun Gong practitioners, headed by Gao Shanshan, 
jointly urged the authorities to stop the persecution. The labor camp 
confined Gao Shanshan into a solitary compartment at once and illegally 
extended her term in the labor camp for an additional two months to 
make this 20-year old practitioner suffer mentally.
    Zhang Zhijie, the team leader of the prison guards at the Shuanghe 
Female Labor Camp, and guard Chen Jianhua illegally extended most 
practitioners' terms of detention for another year so that they could 
maintain a high employment and high bonuses.
    Because it was illegal to produce agricultural chemicals, when the 
authorities came to inspect the camp, production would stop 
immediately. Falun Gong practitioners were also forced to pack 
sanitized chopsticks in their dormitories where they did not have even 
basic disinfected facilities, not to mention proper workshops.
    For another example, Shandong No.1 Female Labor Camp, located at 20 
Jiangshuiquan Road, Jinan City, is commonly known as Jinan Female Labor 
Camp. Since October 2000, however, the number of detainees increased 
sharply to more than 700 people. More than 95 percent of them were 
Falun Dafa practitioners who had been illegally kidnapped and detained 
there. According to WOIPFG, the labor camp signed business deals with 
Jinan Tianyi Printing Co., Ltd. and several other companies, and turned 
the labor camp into handwork workshops for these enterprises, in order 
to increase profit from foreign investment so that the labor camp staff 
could get more bonuses. The labor camp forced the detainees to do 
excessive amounts of labor work. As a result, detainees (including 
elderly ladies over 60 years old) had to work 13 to 14 hours a day and 
sometimes even overnight without pay. Due to working overtime for long 
periods of time, a lot of detainees had difficulty standing, and it was 
very common for someone to faint in the workshop. Those who refused to 
work would be put into a ``confined solitary compartment'' which was 
totally dark. The practitioners confined there were not allowed to go 
to sleep, to wash their faces or brush their teeth. They were also not 
allowed to come out of the compartment to go to toilet and were forced 
to stand continuously for more than 20 days until they became 
unconscious. These people would then have such swollen feet so that 
they could not wear shoes and could not walk.

                 III. WHY ARE CHINA'S PRODUCTS SO CHEAP

    Because of the strong resistance from western democratic countries 
against ``forced labor products,'' in 1991 China's State Council re-
emphasized the ban on the export of ``forced labor products'' and 
stipulated that no prison is allowed to cooperate or establish joint 
ventures with foreign investment. In reality, however, the Chinese 
government has granted numerous preferential policies to enterprises 
under labor camps and prisons, to encourage and attract foreign 
investment and export. In the document [2001] No.56 from the State 
Bureau of Taxation under China's Ministry of Finance, it is clearly 
stated that if the property rights of a company are solely owned by a 
prison or forced labor camp system, the company is exempt from 
corporate income tax and the land inquisition levy.
    FDI and WOIPFG has collected ample evidence that shows China's 
labor camps have cooperated companies to force Falun Gong practitioners 
to manufacture forced labor products without any payment during their 
detention. Products from these labor camps are exported to more than 30 
countries and regions, including the United States, Canada, Australia, 
France, Germany, New Zealand, Southeast Asia, etc.
    The forced labor system not only violates the basic human rights of 
the detainees, but also encourages abuse and torture as camps raise 
their quotas in pursuit of even more profit. Meanwhile, the camps use 
part of the profits to construct more forced labor facilities. In 
addition, the products produced through forced labor are competitive 
and highly attractive in international markets because of their extreme 
low cost. As a result, this has led some foreign companies not aware of 
a product's background to participate in joint venture production, 
importing and selling the forced-labor-produced items. This not only 
violates the laws of their own countries and international laws, as 
many countries forbid the importation and selling of products 
manufactured through forced labor, but also shakes the stability of 
international labor and trade markets, threatening some of their 
homeland companies that share the same market sectors.
    A good example is the lobbying campaign initiated by the six 
largest U.S. textile and fabric trade organizations during their summit 
in Washington, D.C., on June 10, 2003. On July 2, 2003, the American 
Textile Manufacturers Institute (ATMI) published a shocking report 
stating that with the quota removal for Chinese textile products, more 
than 1,300 textile plants in the U.S. would have to close by early 
2004, resulting in the loss of over 630,000 jobs. The U.S. textile and 
apparel market would be under China's control if protective measures 
were not implemented in a timely manner. Ample evidence indicates that 
some textile manufacturers such as the Shanghai Three-Gun Group Co., 
Ltd. the Shandong Leader Handicraft Articles Co., Ltd., and Henan 
Rebecca Hair Products Inc., China, collaborate with ``re-education-
through-labor'' camps or detention centers to force Falun Gong 
practitioners into unpaid hard labor during their detention. The 
unlawfully detained practitioners are forced to endure more than 10 
hours of hard labor per day or even overnight shifts in addition to 
their regular hours. Those products are produced at the cost that their 
competitors can not match.

                III.1. BEIJING XIN'AN FEMALE LABOR CAMP

    According to WOIPFG, Beijing Xin'an Female Labor Camp, located in 
Nanyuan, Daxing Country, Beijing, does handwork for several companies 
for their export products. Beijing Mickey Toys Co., Ltd, a joint 
venture specializing in design, manufacture, sales and export of soft 
toys, is one such company. In February 2001, nearly 1000 illegally 
detained Falun Gong practitioners were forced to make toys with no pay. 
This forced labor produced 100,000 toy rabbits for Beijing Mickey Toys 
Co., Ltd subcontracted by Nestle.
    Ms. Jennifer Zeng is a Falun Gong practitioner currently living in 
Australia. She was detained in Xin'an Labor Camp and was one of the 
practitioners forced to make Nestle toy rabbits. She described her 
experience as follows. ``In the labor camp, we were forced to do all 
kinds of heavy labor work, including planting grass and trees, clearing 
garbage, digging cellars for storing vegetables in winter, knitting 
sweaters, knitting cushions, making toys, producing disposable 
syringes, wrapping sanitized chopsticks and so on. Most of the products 
were for export. In particular, the sweaters we knitted were large 
sizes only suitable for foreigners who are big in build. In February 
2001, we received an order for 100,000 toy rabbits. According to the 
police, the toys were being made for Nestle to be used in their 
promotions. The rabbits were about 30 cm. long, brown in color, with a 
long neck, wearing a large bright red collar made from fleecy material, 
with two black whiskers on each side of the face, about 5-6 cm long. 
Some of the rabbits wore cowboy vests, some wore dustcoats, and some 
had one eye patched up like a pirate. There were English letters on 
their chests, with their fists clenched, thumbs up. There were three 
toes on their feet, canary yellow in color. Their tails were white in 
color and very short.''
    Falun Gong practitioners are forced to work for extremely long 
hours without pay in Xin'an labor camp. Ms. Zeng recalls, ``It would go 
through over 30 processing lines to make a rabbit like this, and it 
would take over 10 hours to make one. But the processing fee for each 
rabbit was only 30 cents (equivalent to Au$0.06, US$0.04). The 
processing fees were paid to the labor camp. We didn't get anything. 
Usually we began work after getting up at 5 o'clock in the morning, and 
worked until 2 or 3 o'clock in the morning the next day. Sometimes we 
had to work overtime, otherwise we could not finish the job. At the 
busiest time, I did not dare to wash my hands after going to the 
toilet, in order to save a few minutes. At night, sometimes I was so 
exhausted that I could not even count clearly from 1 to 9. Yet I still 
had to force my eyes open to knit sweaters. The pattern of the sweater 
was quite complicated; sometimes we finally finished the knitting after 
much effort only to discover the next morning it had been knitted 
completely wrongly. So, we had to unpick the stitches and redo it. Long 
hours of highly intensive workload and severe lack of sleep made me 
feel, for a very long period of time, that the only thing I needed in 
my life was sleep.''
    The picture to the left is a photo of the toy rabbits manufactured 
for Nestle taken from Mickey Toys Co. Ltd. It's clear that they are the 
same as Jennifer described.
    The Sydney Morning Herald and Geneva Le Temps, both reported on 
this case. On December 28, 2001, the Sydney Morning Herald published an 
article by Kelly Burke: ``Cute toy rabbits belie ordeal of Chinese 
labor camps.'' Nestle released a statement to the Herald, confirming 
that the company placed an order with an established Beijing-based toy 
manufacturer, Beijing Mickey Toys Co. Ltd. for 110,000 plush rabbits 
for a Nesquik promotion early that year.

 III.2. LANZHOU DASHAPING DETENTION CENTER AND LANZHOU NO.1 DETENTION 
                                 CENTRE

    Lanzhou Zhenglin Nongken Food Ltd, established in 1988 in Gansu by 
Taiwanese businessman Lin Ken, is one of the earliest Taiwan-financed 
enterprises in Gansu. From 1992, the company embarked on a joint 
venture with Lanzhou Dashaping Detention Center and Lanzhou No.1 
Detention Centre (also known as Xiguoyuan Detention Centre). According 
to WOIPFG, some 10,000 detainees (including dozens of illegally 
detained Falun Gong practitioners) were forced to use their hands to 
peel the shells off melon seeds, and were engaged in intensive physical 
labor work. Those detainees were forced to crack the seeds of a large 
variety of melon between their teeth, and then peel the husk off with 
their bare hands to remove the kernels. In winter, they had to do this 
work outside in the freezing cold. Many of them suffered frostbite and 
the skin on their hands split, with pus and blood from the wounds 
oozing onto the melon seeds. In the summer, the cracking and extracting 
of kernels from shells continued unabated. Many had their teeth cracked 
and damaged from cracking melon seeds, and even lost their fingernails 
in the process of extracting the kernels from their shells. The 
detainees were forced to squat on their heels to do the work from early 
morning till evening for more than ten hours continuously, with no pay.
    In order for Zhenglin Nongken Food Ltd and Xiguoyuan Detention 
Centre to make a huge profit, the detainees were given high quotas for 
their work. The detention center staff tortured the detainees at will. 
Furthermore, there was corruption and economic crimes. In 1998, a 
division chief of Dashaping Detention Center committed suicide with a 
gun when he was found embezzling money of melon seed process fees.
    In April 2001, 57 year-old Falun Gong practitioner Wan Guifu was 
illegally sent to Lanzhou No. 1 Detention Center. Wan Guifu was forced 
to crack melon seeds with his teeth and extract the kernels with his 
fingers. His lips were badly swollen and the fingernails of both his 
hands fell off. His fingers were bleeding and oozing pus. Because he 
was unable to finish his quota, Wan Guifu was tortured by inmates of 
Cell No. 9, after secret instructions from the captain of the 4th crew 
of Lanzhou No. 1 Detention Center. Wan suffered severe injury to his 
abdomen. On December 29, 2001, he was sent to the Lanzhou Dashaping 
Labor Camp Hospital but died three days later. The doctors extracted a 
lot of fluid from Wan Guifu's abdominal cavity, a direct result of the 
severe torture. According to confirmation by people (names omitted) who 
were detained at Lanzhou Dashaping Detention Center for a long period, 
the death rate of detainees at the center was very high, but because of 
the blockade of information, details of the death cases are usually not 
reported.
    These unpaid manual labor provided huge profits for Zhenglin 
Nongken Food Ltd. In just a few years, Zhenglin Nongken Food Ltd became 
the biggest production base in China in roasted seeds and nuts. Its 
main product line, ``Zhenglin handpicked melon seeds'' (shelled by 
detainees), is sold in more than 30 countries including the United 
States, Canada, Australia, France, New Zealand, and Southeast Asian 
countries. At present, Zhenglin Nongken Food Ltd has subsidiary 
companies overseas in the United States, Canada, Singapore, and 
Malaysia. In Australia, they have an import business liaison person.

       III.3. SHANGDONG PROVINCE NO. 1 WOMEN'S FORCED LABOR CAMP

    Shangdong Province No. 1 Women's Forced Labor Camp, also called the 
Jinan Women's Forced Labor Camp, is located at 20 Jiangshuiquan Road, 
Jinan City, Shandong Province. It is the manufacturing site for 
Shandong Leader Handicraft Articles Co., Ltd.
    The detainees are forced to make products without pay. Soon after 
October 2000, the number of detainees suddenly increased from 200 to 
700, with approximately 95 percent of the new detainees being Falun 
Gong practitioners. In order to earn foreign exchange and more bonuses, 
the camp often forced practitioners to work extra hours to sew bedding. 
The over-60-year-old women were also forced to suffer through their 
exhaustion, working overnight in order to complete the tasks. The 
detainees often fall in a dead faint on the floor because of the long-
term overtime and work overload. Those who refused to work were locked 
up in a dark, ``strictly monitored'' room. Rest, sleep, washing, and 
using the toilet outside were all denied. Detainees were forced to keep 
standing for over 20 days until they finally fainted. Their legs and 
feet became so badly swollen that they could not wear shoes and could 
not even walk. They were seriously debilitated, physically and 
mentally. The main products include handmade bedding and domestic 
accessories under the brand name of ``Lijie.''
    Within the first six months of 2002, this forced labor camp made 
570,000 yuan (US$70,000) from its production. Within two years, it 
built an office building over a dozen stories high, a reception 
building, and a big stockroom facility. The products it manufactured 
were sold to the U.S, Canada, Chile, Argentina, European Union, Saudi 
Arabia, Turkey, Kuwait, United Arab Emirates, Australia, Japan, Korea, 
Singapore and over 30 other countries. It is claimed that Shandong 
Leader Handicraft Articles Co., Ltd., is a major enterprise for earning 
foreign revenue. Its annual turnover is 70 million yuan (US$8.5 
million) and annual export is over US$10 million.

           III.4. SHANGHAI QINGSONG WOMEN'S FORCED LABOR CAMP

    Chinese citizen Li Ying lived in Shanghai City and graduated from 
Shanghai Tongji University in 1992 with a major in Business Management. 
She worked in the Shanghai Zhonglu Management Consulting Company. On 
October 16, 2001, she was detained for practicing Falun Gong and 
sentenced to two years' forced labor in the Shanghai Qingsong Women's 
Forced Labor Camp. As a result of the persistent appeals of her fiance, 
Australian citizen Li Qizhong, and the rescue effort of fellow 
practitioners all over the world, she was released on October 15 and 
arrived in Australia on November 29, 2003.
    Li Ying was forced to do hard labor during the time she was 
detained in Shanghai Qingsong Women's Forced Labor Camp, making 
products for many Chinese companies and factories. Aside for the plush 
toys exported to Italy, she had to make products for the ``Three-Gun'' 
brand of underwear. According to her testimony, all the ``Three-Gun'' 
underwear marked with ``examined by # 16'' are made by detainees of 
Shanghai Qingsong Women's Forced Labor Camp. The detainees have to get 
up at 5 a.m. and work from 7 a.m. until 11 p.m. or 12 midnight. These 
long hours of labor result in badly blistered hands and fingers, while 
the wage is just 3 yuan (US$0.35) a day. The detainees have to pay a 
boarding fee of 75 yuan (US$9) per month, which is deducted from their 
meager wages.
    Three-Gun Group Co., Ltd., is authorized to import and export. Its 
main product is the ``Three-Gun'' brand of underwear, which is sold to 
over 70 countries and regions. The Three-Gun Group is also a partner of 
the world-renown Dow Corning and Dupont companies, from which it 
imports technology.

III.5. HENAN PROVINCE'S NO. 3 LABOR CAMP AND THE SHIBALIHE FEMALE LABOR 
                         CAMP IN ZHENZHOU CITY

    Competition within the hair products industry is very intense since 
it is a highly specialized industry with minimal barriers in terms of 
capital, technology, and marketing. Furthermore, since the price of 
human hair raw materials and labor constitute a significant percentage 
of the overall product cost, companies fight for raw material resources 
and cheap labor. As a result, the detainees in nearby labor camps, 
jails, and detention centers have become the slave laborers for making 
low-cost hair products. Analysis of the situation reveals that this is 
one of the main reasons labor camps became the productionsites for 
Henan Rebecca Hair Products and other Henan hair products 
manufacturers.
    To make products for the Henan Province hair products, over 800 
detainees (including illegally detained Falun Gong practitioners) in 
Henan Province's No. 3 Labor Camp and the Shibalihe Female Labor Camp 
in Zhenzhou City have been pushed to work day and night by guards who 
threaten them with torture, punishment, and humiliation. They work 
extra hours to bring in foreign exchange income and more profit for the 
labor camps and Henan Rebecca Hair Products Inc. To increase profits, 
Henan Province's No. 3 Labor Camp even ``buys'' Falun Gong 
practitioners as slaves from other places for 800 yuan (US$100) each. 
When the labor camp was short of funds and was about to be shut down, 
many Falun Gong practitioners were abducted and incarcerated in this 
camp where they were forced to make hair products, thus reviving the 
labor camp's business.
    According to a witness, ``Henan Province's No. 3 Labor Camp was 
awarded the `National Civilized Work Unit' citation from the Central 
Politics and Law Committee `610 Office' and the Labor Camp Bureau, for 
persecuting Falun Gong. At the time the award was put up, three 
detainees fainted from exhaustion. Qu Shuangcai, Director of the No. 3 
Labor Camp, brutally persecuted Falun Gong practitioners and was 
favored by his superiors. In May 2003, he was transferred to the 
Shibalihe Female Labor Camp in Zhenzhou City and promoted to director 
of that labor camp. Right away, he signed a contract with Henan Rebecca 
Hair Products, Inc. He also instituted the use of straightjacket 
restraints for torturing practitioners. Within several months of his 
arrival, three female Falun Gong practitioners were tortured to 
death.''
    With the help of free labor from Henan labor camps, in the first 10 
months of 2002, the hair product export of Henan Province reached 
US$138.86 million, which made it a big industry with over 1 billion 
yuan (US$125 million) in revenue, and Henan became the largest hair 
product manufacturer in the world. The hair product industry has had a 
consecutive annual growth rate of nearly 30 percent, and Henan's hair 
products have a market share of one fourth of the world's total. Owning 
five labor camps/hair product factories, Henan Rebecca Hair Products 
Inc. has been the world's leading producer of human hair weaves.
    According to sources, the U.S. is the largest distribution and 
consumer market of hair products in the world. Rebecca accounts a 
significant market share in the United States. Statistics show that the 
U.S. has a need for 15 million human hair weavings, 10 million of which 
come from Xuchang, Henan.

            III.6. OTHER EXPORT PRODUCTS MADE IN LABOR CAMPS

    Numerous other products made in China's labor camps by Falun Gong 
practitioners are finally exported to the United States and other 
countries.
    Mr. Sam Lu is now an Atlanta resident. He was put in a jail in 
Guangdong Province for almost two months in 2001. According to his own 
testimony, Sam was forced to work on export products such as toys and 
shopping bags without pay. He still remembers one of the shopping bags 
was printed with ``National Gallery of Art.'' Sam was put into a cell 
only about 300 sq. feet in size, with 20 prisoners and one toilet 
inside. They slept and worked in the cell.
    Sometimes they were forced to work until 2 am to keep up with the 
schedule. Only two meals a day were provided. The police used a wire 
whip to beat prisoners if they did not do a good job or could not keep 
up with the schedule.
    The same kind of tragedy is happening to Sam's wife Xuefei Zhou, 
who was sentenced to forced labor camp for three years without any 
trial and without a lawyer only because she handed out flyers in the 
street to clarify to the truth about Falun Gong. Xuefei was forced to 
do embroidery work for export. The hard work, malnutrition and torture 
made my wife almost lose her eyesight.

III.7. U.S. CITIZEN DR. CHARLES LEE IS FORCED TO MAKE CHRISTMAS LIGHTS 
                  TO BE EXPORTED TO THE UNITED STATES

    U.S. citizen Dr. Charles Lee was arrested upon arriving at 
Guangzhou Airport on January 22, 2003. He was rushed through a one-day 
show trial on March 21, 2003, and sentenced to a 3-year prison term for 
his ``intention'' of exposing human rights violations against Falun 
Gong practitioners by the Chinese government. He has not committed any 
crime, nor did he intend to. His only intent was to expose to the 
Chinese people the reality of the nature of the persecution that the 
Chinese government has concealed from them.
    According to the information from Friends of Charles Lee, 
throughout one and half years of detention, Dr. Lee has suffered both 
physical and mental abuses: he has been beaten, force-fed, deprived of 
sleep, handcuffed for days at a time, and forced to watch anti-Falun 
Gong brainwashing videos. These tactics are employed to try to break 
his spirit, and cause him abandon his belief in Falun Gong. It is 
evident that the persecution of Dr. Lee directly targets his belief in 
Falun Gong.
    Starting from June 2004 to late 2004, Dr. Lee was forced to make 
Christmas lights daily. At times he was forced to work 10-12 hours per 
day and 7 days a week. These Christmas lights are to be exported to the 
United States.

           IV. THE INFORMATION CONCEALING AND MEDIA COVERAGE

    How much does the world know about what happens in China's labor 
camps? Will people still buy China's exports if we know it is made in 
China's labor camps by Falun Gong practitioners?
    Unfortunately, Ms. Gao Rongrong's death highlights the systematic 
cover up and the fear of Chinese Communist Party for people to know the 
truth. Afraid of the publicity of Ms. Gao's disfigure, Shenyang City 
Police Department (State Security Division) began tapping the phone 
lines of all Falun Gong practitioners in the region, and a manhunt 
ensued, resulting in re-arrest of Ms. Gao and several abducts and 
subsequent tortures to related Falun Gong practitioners.
    Ever since Chinese Communist Party launched the persecution toward 
Falun Gong in July 1999, the communist regime has utilized its state 
run media to orchestrate a hate campaign toward Falun Gong, without 
allowing practitioners any voice. Chinese government penalizes severely 
for anybody who dares to challenge its information blockade. Mr. Liu 
Chengjun, male, from Jilin Province, was involved in the incident of 
broadcasting Falun Gong truth programs through the Changchun Cable TV 
System on March 5, 2002. To revenge, Chinese authorities ordered a mass 
arrest in Changchun soon after. The police shot Mr. Liu at his legs to 
arrest him. On September 20, 2002, Changchun City Intermediate People's 
Court sentenced him to 13 years in prison. On December 26, 2003, Liu 
Chengjun left this world after enduring 21 months of prison torture.
    Chinese Internet market is fast-growing, yet, China is believed to 
extend greater censorship over the net than any other country in the 
world. In China, all 110,000 net cafes in the country have to use 
software to control access to websites considered harmful or 
subversive. A net police force monitors websites and e-mails, and 
controls on gateways connecting the country to the global internet are 
designed to prevent access to critical information. It has been 
reported that Cisco Systems has sold several thousand routers--costing 
more than US$20,000 each--to enable China to build an online spying 
system and the firm's engineers have helped set it to spot 
``subversive'' key-words in messages. The system also enables police to 
know who has looked at banned sites or sent ``dangerous'' e-mails. 
Cisco is not only concerned by a code of ethics, but also violates the 
Global Internet Freedom Act, passed by the House of Representatives of 
U.S. in July 2003, aims to combat online censorship imposed by 
repressive regimes such as China.
    Not content with controlling Chinese language media in China, 
China's communist regime is doing its utmost to influence the world 
media. On January 21, 2005, AP's Beijing Bureau released a story 
``Chinese Government Shows off Repentant Falun Gong Followers,'' which 
echoed the CCP's official portrayal of the January 2001 Tiananmen 
Square self-immolation tragedy, though numerous reports by independent 
media and human rights bodies worldwide have questioned and repudiated 
claims by the Chinese Communist regime linking Falun Gong to the 
immolations. The Falun Dafa Information Center anticipated Beijing's 
propaganda shenanigans, and thus sent a media advisory to the AP and 
others detailing concerns. That was before the AP's story ran. And yet 
the AP's piece went beyond merely failing to present or engage Falun 
Gong's concerns to doing exactly what the advisory cautioned against.
    With WTO accession, China is under pressure to open up its massive 
media market. At the meantime, it is also seeking for vehicles to 
disseminate its own message across, not only to the overseas Chinese, 
but also to the world at large. For examples, when the AOL Time Warner 
and Rupert Murdoch's Phoenix Satellite Television Holdings were allowed 
to broadcast their programs in China, they were asked, in return, to 
carry news and propaganda of the state-owned China Central Television 
(CCTV) on the cable networks of AOL Time Warner and Rupert Murdoch's 
Fox. Furthermore, the broadcasting has to be managed to steering clear 
of issues that Chinese authority would deem offensive, such as the 
persecution against Falun Gong practice group, for the penalty could be 
cancellation of broadcast privileges. Former employees, rights 
organization and the free press have criticized the Murdoch empire for 
its failure to raise sensitive issues in China. Maybe Murdoch has 
learned how to bow to Beijing from the hard lesson of Star-TV 
discontinuing the BBC's World Service when Murdoch owned that company 
and talked volubly about how dictatorships would crumble under the 
weight of global communications.
    In their efforts to conquer the world's most populous and 
potentially lucrative Internet market, some multinational firms are 
making compromises that limit the right of Chinese Internet users to 
freedom of information. In October 2004, U.S.-based Google admits to 
removing eight news sources, apparently deemed subversive, from its 
Chinese site. As recently as the search kingpin went public in August 
2004, its founders vowed to hold the customer experience sacrosanct. 
According to Business Week (October 11, 2004), Google offers China 
users an uncharacteristic lack of disclosure on the removed content, 
aside from the censorship itself. On November 29, 2004, Reporters 
Without Borders condemned the action of the Chinese authorities in 
blocking access to Google's news website (Google News), starting a few 
weeks after the launch of an expurgated Chinese-language version of 
Google News. The press freedom organization said in a statement ``China 
is censoring Google News to force Internet users to use the Chinese 
version of the site which has been purged of the most critical news 
reports. [. . .] By agreeing to launch a news service that excludes 
publications disliked by the government, Google has let itself be used 
by Beijing.''
    Google's archrival Yahoo! has been censoring its Chinese-language 
search-engine for several years as directed by the Chinese government. 
For example, the top 
results of a search for ``Falun Gong'' produces only sites critical of 
the Chinese meditation practice in line with the regime's position. The 
same search using a non-censored search-engine turns up material 
supporting Falun Gong and about the 
government's repression of its followers. Meanwhile, other search-
engines not conformed to the censorship, such as Altavista, have 
already been blocked inside China.
    ``With the cooperation of companies such as Cisco, Sun 
Microsystems, Yahoo!, and Google, Chinese authorities used American 
technology to monitor, sanitize, and ultimately isolate the Chinese 
web, creating the world's greatest Red Internet.'' (Quoted from Can 
FDI(Foreign Direct Investment) Save the Shaking Chinese Economy? by Li 
Li and Ching-hsi Chang, 2004.)
    The latest episode of China's control in the world media is CCP's 
coercion toward Eutelsat to take NTDTV off the air, so Chinese people 
will lose the only open window to access the uncensored TV programs.

                V. THE LASTING AND FAR REACHING IMPACTS

    The crackdown on Falun Gong over the past six years in the People's 
Republic of China has led to the unjust imprisonment of thousands of 
innocent practitioners, has subjected them to severe forms of mental 
and physical abuse, and has caused their families and loved ones 
countless hours of emotional agony. Consequently, in the wake of this 
savagery, many children have lost either one or both parents and 
sometimes even their caregivers. According to the 2005 report of GMR 
(Global Mission to Rescue Persecuted Falun Gong Practitioners, five 
children were killed in 
police custody; 18 children lost both of their parents during the 
persecution; 102 children lost one of their parents; 43 children are 
directly targeted, tortured, or thrown into prisons and labor camps 
because of their or their parents' belief in Falun Gong; 39 children 
are forced to separate from their parents because their parents are 
detained. In addition, hundreds of thousands of children have been 
forced to slander Falun Gong or, upon refusal, be expelled from school. 
Moreover, many young ones are discriminated as their parents are 
practicing Falun Gong. This data, however, only represented the 
information investigated and confirmed by GMR.
    For example, Zhuangzhuang Pan is a five-year-old boy from 
Shuangyashan City, Heilongjiang Province. Zhuangzhuang's father Xingfu 
Pan, former Associate Director of Telecommunications Bureau Exchange 
Center in the city of Shuangyashan, Heilongjiang Province, was 
persecuted to death on Jan. 31, 2005 because he practiced Falun Gong; 
and his mother Li Zhang is serving a 9-year sentence in Harbin City 
Women's Prison. In addition, both Zhuangzhuang's uncle and aunt are in 
forced labor camps. Zhuangzhuang and his 64-year-old grandmother now 
depend on each other with no financial income.
    In May, 2001, Xingfu Pan was arrested by Shuangyashan Patrol Team 
and was incarcerated in the Shuangyashan Detention Center. On March 7, 
2002, Pan was unlawfully sentenced to 5 years in prison with no 
evidence. During his periods of incarceration, Pan was forced to do 
lots of heavy labor work in addition to endure various brutal tortures. 
After years of forced labor as well as various mental and physical 
tortures, Pan's health deteriorated dramatically. On June 18, 2004, he 
was diagnosed as having pleurisy and lung tissue damage. He was too 
weak to use the toilet on his own. On Jan. 31, 2005, Mr. Pan Xingfu 
died, leaving his sixty four-year-old mother, his five-year-old son and 
his imprisoned wife behind.
    In early morning of May 2, 2002, Zhuangzhuang's grandmother was 
also arrested at home, and frightened Zhuangzhuang was left alone at 
home. To protest the unlawful detention, Zhuangzhuang's grandmother 
went on a hunger strike. As punishment, the 62-year-old lady was locked 
in an iron chair and violently force-fed with extremely salty corn 
gruel. Her shirt was soaked with blood from her mouth. Finally, after 
15 days on hunger strike, she was released.
    Seeing so many relatives being brutally taken away, little 
Zhuangzhuang was traumatized by these episodes. Since then, he would be 
in constant fear of the police taking his grandmother away again 
whenever he heard any loud voices.
    In fact, over the past six years, millions of Falun Gong 
practitioners have been locked up in labor camps, brainwashing centers 
where they are forced to ``transform,'' or renounce their belief in the 
principles of Falun Gong--Truth, Compassion and Tolerance. They are 
made to choose between spiritual death and physical death: If they 
refuse to renounce their practice, the efforts to facilitate 
``transformation'' are intensified and many die as a result of 
beatings, torture, and starvation, among other methods. Their children, 
unfortunately, have to witness these fatal struggles.
    All Chinese people have, in actuality, been pushed into 
compromising their consciences in order show an attitude of support for 
this persecution. Through the state-controlled propaganda machine, even 
foreign governments and corporations doing business in China are forced 
to choose between conscience and personal interest when faced with the 
persecution of Falun Gong. The campaign to annihilate Falun Gong 
practitioners permeates all levels of society. Children are the most 
deeply affected, as their pure hearts are so easily damaged or warped 
by brainwashing and propaganda. The abuse and trauma they suffer is 
something that will affect them for the rest of their lives.

                             VI. CONCLUSION

    Due to censorship and the tight control on information related to 
Falun Gong in China, what is reported here represents perhaps only a 
tiny tip of the iceberg. I hope that this testimony will help you 
understand the severity and scope of the ruthless campaign of 
persecution against Falun Gong practitioners in China. It is my hope 
that this Congress will continue and double its efforts to rescue and 
help these innocent people and their children, and help bring an end to 
this human rights atrocity in China.