Thursday, 8 August 2019

The Asiatization of Life - The Butchers of Beijing and the Western Bourgeoisie

We have argued at length on this space that the Western capitalist bourgeoisie has looked with languid envy at the way in which Oriental autocracies were able to subject their populations to degrees of enslavement and misery that were inoperable and seemingly unattainable in the West. What the Western bourgeoisie is seeking to do now, for the nth time, is nothing less than what we have called "the Asiatisation of Western society" - to reduce our proud culture of the pursuit of Freedom and Emancipation to something as miserable and flat as a Japanese tatami or a Chinese bowl of rice! Below is a clear illustration of how this process takes place in Hong Kong, even as the Western bourgeoisie nonchalantly looks the other way as the Butchers of Beijing plot the next murderous venture of "the People's Suppression Army".

Democracy, Property and Oligarchy in Hong Kong

Maintaining the city’s position as a global financial powerhouse requires a resolution to the political stalemate and an economic overhaul

Hong Kong is the most free economy in the world—in theory. In reality, most residents struggle to get by, and have little say in their political or economic future. PHOTO: ISAAC LAWRENCE/AGENCE FRANCE-PRESSE/GETTY IMAGES
Hong Kong is in the midst of its worst political violence since the semiautonomous city’s handover to China in 1997. Defusing the crisis—and maintaining its status as a global financial powerhouse and conduit for capital into China—requires urgent action not only on grievances including police accountability and stalled electoral reforms but also on deep, festering problems with the city’s economic model.
That means curbing the power of Hong Kong’s property tycoons and monopolies, finding a government-revenue model that doesn’t depend on sky-high property prices, and spending far more state resources immediately on public housing and public assistance. By some measures, Hong Kong is already among the most unequal societies in the world.
No ShelterReal (inflation adjusted) residential propertyprice indexes, 2010=100.Source: Bank for International Settlements
U.S.All advanced ecoomiesCanadaHong Kong2010’11’12’13’14’15’16’17’1875100125150175200225
Most of Hong Kong’s most urgent economic problems relate to land. Median income growth has been modest over the past decade, but residential property prices nearly doubled in real terms from 2010 to 2018, according to the Bank for International Settlements. That far outpaces increases even in other notoriously bubbly markets such as Canada, where prices are up about 40%. Hong Kongers live in tinier apartments and pay more for them than nearly anywhere else.
Part of the issue is Hong Kong’s hilly geography, which means new space for building is limited. But an arguably much bigger problem is the vested interests of the government and big property developers in keeping prices high.
Hong Kong’s low tax rate and big fiscal surplus—the government over the past three years earned on average close to 20% more than it spent—is in fact funded largely by government land sales, which were 27% of total revenues in fiscal year 2017/2018. To make matters worse, the proceeds of land sales go into the Capital Works Reserve Fund, which is slated for infrastructure development. Hong Kong already has exemplary infrastructure. Residents watch in frustration as the authorities splurge on Beijing-backed political white-elephant projects like the multibillion-dollar sea bridge to Macau and high-speed rail link to Shenzhen, all while they can’t afford basic housing.
Rising WatersChange in nominal terms since December2010 in Hong KongSource: CEIC (income), BIS (property price)
%Median household incomeResidential property prices2012’13’14’15’16’17’18’190255075100125150
High property prices also make it hard to start small businesses—particularly since antimonopoly enforcement is already weak. Hong Kong, unlike most of its global peers, didn’t even have a comprehensive competition law in substantive effect until 2015. That has enabled property tycoons to fortify their empires with near-monopolies in areas such as utilities, transport and grocery stores, raising prices and stifling growth.
The government’s main solution to exorbitant property prices is the Lantau Tomorrow Vision, a proposed land-reclamation project near the territory’s largest island with an estimated cost of about $80 billion. New apartments, however, wouldn’t be available until the early 2030s—meaning a whole generation of young people could essentially remain priced out of the market even if the plan works. Critics say land supply could be boosted much more rapidly and cheaply by redeveloping existing brownfield commercial and agricultural sites as housing.
Mainland China’s political model works to the extent it does because citizens sacrifice a direct say in their future with the understanding that things will continue to improve. Denying people a say while simultaneously offering no real hope that things can improve is a far tougher sell.

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