The Proxy War; Corruption scandals are a battleground for jousting among the nation's top leadership.

Byline: Melinda Liu (With Jonathan Ansfield and Craig Simons in Beijing)

"Before the Gates of Hell" has all the makings of a Chinese best seller. The new book tells of a provincial tax-bureau boss who gets promoted several times and goes crooked along the way. The cadre pockets bribes steadily and profits from illicit foreign-exchange transactions before being caught and executed for his misdeeds. "Gates of Hell" is notable because it's a true story, based on conversations the author had with former Hebei province tax-bureau head Li Zhen. In interviews with Xinhua news-agency reporter Qiao Yunhua, who wrote the book, Li poured out his heart about his moral transgressions. He was put to death in November 2003 for corruption. "Tell my young son that his father died because of greed. Tell him to take a job as a manure carrier or a beggar--just don't take bribes," Li sobbed to the author.

Li Zhen's death-row confessions are the talk of Beijing these days. Though corruption tales are a touchy topic, the Communist Party's propaganda machine wants its cadres to learn a lesson from Li's demise. It's easy to see why: government graft and cronyism are massive problems, and are the top complaints of ordinary Chinese. From 1998 to 2002 nearly 850,000 party cadres were punished for corruption. Since the 1980s, when market reforms were first introduced, up to 4,000 crooked officials have fled to foreign lands, according to the Legal Evening Daily--taking an estimated $50 billion with them.

The problem now serves as a battleground upon which the country's most powerful political actors are jousting. Observers looking to see whether President Hu Jintao has fully taken the reins after his predecessor, Jiang Zemin, gave up his last official position in September have little to base their judgments on; China's leaders are not given to drastic policy shifts or pronouncements. So instead they're keeping a close eye on proteges of the two men and how they're faring in the murky world of Communist Party politics. "No one dares attack Hu or Jiang openly, so their more vulnerable allies are the targets," says a foreign diplomat in Beijing.

Last month, for instance, Tian Fengshan, the former minister of Land and Natural Resources, was booted out of the party and charged with accepting bribes for promotions he doled out as a senior official in Heilongjiang province in the 1990s. Since 2002, a remarkable number of corrupt officials have been detained in Heilongjiang, especially in Suihua city. But Tian's case was sensitive because he's a friend of Hu's. Both men attended Beijing's Central Party School at the same time. Sources close to the probe told NEWSWEEK that the question of whether to go after Tian was passed all the way up to Hu himself, after hundreds of lower-level Heilongjiang officials were detained in 2002 and 2003. Hu reportedly decreed that his former pal be dealt with according to the law. "In the political struggle at the top, Tian was sacrificed and Hu couldn't--or wouldn't--help him," says one source familiar with the probe.

Tian's downfall was thought to be part of a behind-the-scenes deal between Hu's camp and supporters of Jiang Zemin, many of whom served as officials in Shanghai and are collectively known as the Shanghai faction. In exchange for Tian's departure, some sort of disciplinary action was supposed to be meted out to a senior Shanghai official implicated in a financial and real-estate scandal in China's largest city, according to an official in Heilongjiang.

But apparently there was no trade-off. Shanghai has been the epicenter of a sensational criminal case in which business magnate Zhou Zhengyi--ranked as China's 11th richest man by Forbes magazine--was charged with financial wrongdoing ...