A variation of my article below was published at Naomi Wolf’s Dailycloudt.com and Britain’s leading liberal magazine, New Internationalist. A complete summary of CY Leung’s inauguration weekend, pro-democracy protests and SAR handover events can be found on my Hong Kong blog.
Milton Friedman has long believed Hong Kong to be the model success story of laissez-faire economics. In the eyes of the WTO, the ex-colony’s status as the world’s freest economy is an ideal for the rest of the world to aspire to. In reality, the ‘capital of capitalism’ is anything but non-interventionist and the city today should stand as a warning to libertarians and corporate defenders the world over.
Mind the gap
Although the territory has seen a huge growth in the number of millionaire residents, the local census Gini Coefficient shows inequality to be at its highest level for 30 years. As it celebrates 15 years of Chinese rule, the UNDP states that the wealthiest 10 percent of the populace control more than a third of the city’s income, whilst the bottom 10 percent share only 2 percent. A meagre minimum hourly wage of US$3.5 was only introduced last May and, with little corporate regulation or competition controls, a small handful of rich tycoons and their conglomerates reign freely. It has resulted in Hong Kong having the worse inequality amongst all OECD members; a fact that should make it a poster-boy for the failures of ‘free trade’. Yet income disparity is only set to worsen as the aging population and low birth rate give rise to an ever-shrinking workforce.