Resentment of the property oligarchs and the government means it’s not out of the question, reports Asia Sentinel
Could the Occupy Wall Street movement take root in Hong Kong? It may seem improbable that resentment at a symbol of capitalism could flourish in this citadel of money-making. Unlike the US, unemployment has been falling, a minimum wage has finally been introduced after years of resistance, and there is no residue of the 2008 banking crisis to spur resentment at bailouts of fat cats.
Nonetheless, Hong Kong does share one important similarity with the legions of aggrieved average Americans: standards of living for the majority have been static for years despite apparent constant gains in the overall economy. The income gap has also widened steadily and is now worse in Hong Kong than in any developed economy – and in the Latin American league of inequality.
In Hong Kong resentment is more focused on property developers and the government (which controls land supply) than the bankers. But it is not beyond belief that if the global economy declines in 2012 and unemployment rises in Hong Kong there could be the mass demonstrations which occurred in 2003 and contributed to the ouster of the Chief Executive Tung Chee-hwa by Beijing.
The incumbent since then, Donald Tsang, is sure to get to the end of his term which expires next year. But his final policy address to the Legislative Council this week showed that the government has scant idea of how to deal with a problem that it keeps admitting is worrying. Meanwhile it remains wedded to reliance on the property sector for revenue despite that sector’s role in increasing the income inequality. Tsang has successively been financial secretary, chief secretary and chief executive for a total of 16 years but despite promises to make the revenue system broader, fairer and more stable has merely tinkered with it.
Tsang’s approach to poverty was again simply to offer a few minor concessions. Those over 65 will get cheap fares on trains, ferries and buses, and the over-70s and other welfare recipients get a one-off handout, as will public housing tenants. But this is small stuff particularly when set against the macro data. The latter shows that although the economy has supposedly expanded by 55 percent since 1997 and wages and salary income by 31 percent, real wages have risen by just 11 percent in 13 years. Such increasing income gaps have been common to most developed countries but Hong Kong is an extreme case, which appears to have a number of causes. These include the influx both of low-skill mainlanders and Southeast Asian domestic helpers which have depressed wage levels for the unskilled; the high profits of monopolies and oligopolies, most of which are not re-invested locally; the determination of the government to spend on capital works of dubious economic benefit rather than on income transfers to help the poor; and the property sector.