The Emperor Is Not That Far Away

Beijing Will Not Accept Hong Kong's Economic Decline Without Question.

"For the general public of Hong Kong and foreign investors, this law is the protector of their rights, freedoms, property and investment.”

With those words on Hong Kong’s latest addition to its national security regime, Article 23; Beijing’s man in Hong Kong, Xia Baolong, Director of the Hong Kong, and Macau Affairs Office, left his audience dumber for having listened to what may have been the most out of touch economic speech in the history of Hong Kong.  An impressive task considering we had C H Tung and Carrie Lam as leaders of Hong Kong.

A few days back, Hong Kong put on its annual National Security Day.  It was the usual goose-stepping youth, bad music, and hyping of the non-existent security threats to Hong Kong.  Communist holidays are best done with a true communist effort, which means everyone pretends to pay attention, and then enjoys the day off. 

The poor people of Hong Kong are put through an all-day wringer as the combination of Leninist-Marxism and the British taught efficiency of the Hong Kong civil service equates to a truly nightmarish day.

Which brings us to the real problem of why Hong Kong’s economy is not recovering and will not recover.  China has many bad economic ideas; however, they are blessed with a bureaucracy that does not work hard to implement those bad ideas. Whereas in Hong Kong we have a chief executive and the senior civil service which still is competent in its administration of the city.  But now, this same diligence and hard work creates an economic trash heap as John Lee and his team not only come up with very bad ideas, but also work very hard to make sure they are implemented.   

In China the latest musings of the political boss are applauded and then usually “modified”.  Hong Kong’s leaders try to turn bad ideas into action.  As such, garbage in, garbage out for Hong Kong’s economy.

"To move towards governance and prosperity, we need to tightly hold onto the bottom line of national security in order to safeguard the high quality development of Hong Kong," said  Director Xia. 

I have no idea what the hell Xia means here. But it’s a long way from, "It doesn't matter whether a cat is white or black, as long as it catches mice." A little nugget of wisdom from past big boss Deng Xiaoping that told his party members to lighten up on the people and let them earn.  I think we can agree that cat metaphor was better economic policy than what is coming out of Hong Kong these days.

Hong Kong is being led by men who are economically ignorant in terms of what a modern international city requires for it to attract capital, talent, and most importantly a confidence that the city operates on free market principles and not dictates from communist apparatchiks. 

I'm not one that wants Hong Kong to go down the tubes. 2019 and 2020 for myself and many around me had nothing to do with issues inside China.  Those years, and the years since 1997 were, for most Hong Kong people, focused on keeping Hong Kong a free market with low regulation and a rule of common law compliant city.  That battle has been lost.

Yet, what can remain of Hong Kong can’t be saved if those who run Hong Kong have decided to double down on repression and removing the freedoms that any functioning open economy must have.

Maybe Director Xia and Chief Executive John Lee really do think things are satisfactory. Every leader is allowed their delusions.  Yet, I don’t think everyone in China shares their view on the current state of Hong Kong.

There's an old saying I learned many years ago when dealing with Beijing.  “The mountains are high, and the emperor is far.” We all understand that means that you can always get away with a few things when you’re not under Beijing’s direct gaze.

There's another meaning to it as well.  Beijing is far away.  But you are responsible for what you do, and you will be held responsible when you fail.   Hong Kong is failing. The hardline rhetoric we are hearing from the leaders isn't evidence they are confident of their moves.  Rather they are making excuses for the faraway emperor, who, will sooner or later start asking why Hong Kong is no longer the asset to China it once had been.