Hail to the Chief

Hong Kong is a “special administrative region” (SAR) region of the Peoples Republic of China, the last “the sun never sets on the British Empire” colony; the Brits handed Hong Kong over to the PRC on July 1, 1997, but China pledged to honor locally-significant liberties in the former colony through at least 2047. There are 3.4 million registered voters in this SAR out of population in this crowded city-state of just over 7 million people. Its very existence as a global powerhouse has always been predicted on finance and trade, a place which accelerated in importance after it became a part of a settlement of the notorious “Opium Wars” in the middle of the nineteenth century. Because of a horrific balance of trade deficit at the time, stemming from a massive importation of Chinese tea with no offsetting exports to China, Britain began forcing a commodity that she had in excess – opium stored in India – into China, sometimes under the guise of a generally curative medicinal drug. As addiction grew, China naturally resisted. Britain and her allies (including the United States for a while) reciprocated and attacked Chinese forts and military forces with the most modern weapons available at the time. Hong Kong was one of several treaty concessions extracted by the allies after humiliating China’s antiquated military.

But Hong Kong was not a permanent transfer, although for those alive in 1842, it probably seemed that way. 1997 was programmed into the treaty as an end date. Today, there is a duly elected legislature that operates within the limits imposed by the PRC-driven “Basic Law” and the confines of the PRC tolerance for freedom in Hong Kong. It is an uneasy balancing act, made more difficult by the process of electing a “Chief Executive” – the effective president/governor – of the region. All those voters, well, they actually don’t have a say in this selection process. The Chief Executive is elected by a “1,200-member election committee for the chief executive drawn from broad sectoral groupings, central government bodies, municipal organizations, and elected Hong Kong officials.” CIA World Factbook. What isn’t exactly stated, but is obvious to every resident in Hong Kong, the folks who elect the Chief Executive always tow the Beijing party line and represent the former colony’s power elites, very much to the exclusion of the “average” worker.

If we think economic polarization is bad in the United States, and it really is, what has happen in Hong Kong since 1997 has further divided the haves from the have-nots. The wage gap between the top 5% and the rest of Hong Kong is widening by the minute, and real estate costs in this city with mainland and island holdings severely limiting residential possibilities is soaring to heights that would make millionaires in Beverly Hills blanch. The business elite have learned to smile and accept Beijing’s gradual contraction of local liberties, not caring much as long as their financial interests are protected. The quality of life for those in the middle and at the bottom is plummeting, as life is good, very, very good, for those at the top. A new Chief Executive took office on July 1^st in a ceremony presided over by China’s leader Hu JinTao, the third such executive since the takeover.

All is not peaceful in this mega-rich land. Protests exploded on July 1^st. “Surging down broad avenues between high-rises in a central shopping district, the protesters marched toward two government office complexes carrying a variety of banners. A wide range of causes were represented, including greater democracy in Hong Kong and calls for better state pensions and day care… But the most common theme was derision toward Hong Kong’s new chief executive, Leung Chun-ying [above]. He was widely portrayed as a wolf because democracy activists contend that he is ‘a wolf in sheep’s clothing,’ whose sympathies for the Chinese Communist Party may lead him to roll back some of the city’s cherished civil liberties — although Mr. Leung has denied that…

“People streamed out of Victoria Park, where the protest began, and into the march for more than four hours, making it one of the largest political protests in Hong Kong in the past decade — or anywhere in China, for that matter, since protests are banned on the mainland… The Hong Kong police said that the number of people in the park at the beginning of the march had been 55,000. Organizers said that 400,000 people had participated in the march, including many who joined along the nearly two-mile route…

“[But the stench of privilege permeated the protestors’ words and banners.] When Mr. Leung entered the election campaign last autumn, he was widely seen as an underdog partly because many Hong Kong residents saw him as a close ally of the Chinese Communist Party. His rival, Henry Tang, the scion of a wealthy manufacturing family originally from Shanghai, had strong support from the influential Shanghai faction in mainland Chinese politics.

“But Mr. Tang’s candidacy imploded in a series of setbacks, notably the disclosure early this year that an extensive basement had been built under his wife’s house without planning permission from the government or the payment of real estate taxes and fees. So it came as a surprise a week ago when it turned out that Mr. Leung had six illegal structures at his home — valued at 500 million Hong Kong dollars, or $64 million — in one of Hong Kong’s most prestigious neighborhoods… Mr. Leung, one of the city’s most successful real estate surveyors, has publicly apologized and said that four of the structures were already there when he bought the house in 2000 and that he did not realize the other two, a glass canopy and a trellis, were illegal.

“The disclosure of Mr. Leung’s real estate transgressions has particularly hurt his image because a central theme of his campaign was to address the city’s acute shortage of affordable housing. Among the housing issues facing him as he takes office is whether to force the demolition of thousands of illegal structures in outlying areas; whether to halt the encroachment of residential construction on parks and other government land; and whether to step up the pace at which the government makes land available for public and private housing projects.” New York Times, July 1^st. The “two systems, one country” approach is eroding, but that cannot come as a surprise to anyone familiar with Chinese politics. However, the disenfranchisement and economic polarization that pits workers against the power elite is an issue that the central authorities in Beijing know must be handled across all of the PTC… and handled soon… if peaceful economic growth is to continue.

I’m Peter Dekom, and the issue of polarization has given rise to everything from the Arab Spring to the above protest in Hong Kong to the very impasse we see in our own Congress.