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  • Dec 20, 2014
  • Updated: 5:13pm
My Take
PUBLISHED : Monday, 10 March, 2014, 2:47am
UPDATED : Monday, 10 March, 2014, 2:47am

China's parliament a billionaires' club

Where in the world of politics would you find the greatest concentration of billionaires?

Looking at the annual Hurun list of China's richest people, a good start may be with the National People's Congress and the Chinese People's Political Consultative Conference, which opened their annual meetings last week.

The NPC has 86 yuan billionaires, while the CPPCC, the nation's top political advisory body, has 69 billionaires. The richest NPC members have seen their average wealth multiply more than four times over the last eight years while the 1,000 richest folks on the mainland only managed to average a threefold increase. The average fortune of the 155 NPC and CPPCC billionaires is 9.7 billion yuan, compared with the average 6.4 billion yuan of Hurun's list of the 1,000 richest people in China.

The number and wealth of the richest lawmakers are almost certain to be underestimated because the enforcement of disclosure rules ranges from lax to non-existent.

Now you may argue, perhaps, that many of them were asked to join those august bodies after they had already achieved wealth and status. And a few billionaires and their sons are from Hong Kong, where Communist Party membership would hardly guarantee wealth, but rather the opposite before the 1997 handover.

Perhaps. There are 56 billionaires who have served more than one five-year term - on either the NPC or CPPCC; their average wealth increased more than three times. Now their wealth-building may have all to do with their business acumen, but being closely associated with the Communist Party certainly doesn't hurt. The "billionaires" irony in a socialist country is just too rich, even for sarcastic and cynical Karl Marx. Luckily, I learn much of my philosophy of life from the other Marx, that is, Groucho, so I realise the only parties that are worth joining will never have someone like me as a member. It's the way of the world.

Still, like many people who dream about winning a snowballed Mark Six, I fantasise about the fabulous social status, connections and wealth-building opportunities an elite membership can confer. The Communist Party on the mainland seems like a sure ticket. If only I could get in!

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lucifer
..that raises a question: Does being a billionaire make it easy to get into the legislature, or does being in the legislature make is easy to become a billionaire? Either way its ridiculous, especially when you realize that 25 years ago, nobody in China had a million dollars.....
ognevodd
Now that you've wrote this article, you'd better look behind your back a bit more often and avoid going back to village. It would be a shame if you ended up like Kevin Lau.
Oh wait, no, it's OK, you didn't offend anyone - you said that it's OK to get rich illegally and you also want to be one of them. It's fine then.
pslhk
With K Street and Super PAC’s
US billionaires don’t have to sit in the Congress
and suffer boring hours deprived of Albert Ho’s pleasure
whymak
With your nonstop bovine defecation, I think you are already in stage 3 rectal cancer. I will contribute 1 yuan to your medical expenses, maybe another 2 yuans if your condition worsens.
goncalo
The CCP should be renamed: The Wild Capitalism Party.
whymak
Mr. Lo,
Even though China is still very much a developing economy, it has already surpassed the West in understanding the secret to stable governance. Democracy or any other systems matter little if they ignore this principle: A well-functioned government distributes power according to existing influence and wealth already vested in the nation’s stakeholders.

Electing leaders is only a smoke screen. All talks about human rights and speech freedom aside, government leaders with few exceptions could only change bureaucratic and institutional processes at the margin.

The second principle is the mandate of the governed is created from media manufactured consent. It’s about brainwashing vast majority into thinking that it’s a government by the people.

Another alternative is to demonstrate continuous economic advances, coupled with the delusion that its society is fair and just. On this, China trailblazes a new path.

Make no mistake, brainwashing people in any system is a given.

I will now offer a counterpoint to yours. More than half of US House members are millionaires, with an average individual net worth of 1.01 million and an average salary over 170K a year (98.5 percentile). Including other incomes and perks, this puts them comfortably into the top 1%.

Political primaries are freak shows. Only those with heavy financial support from businesses could win one of 2 major parties' nomination. HK True Democracy morons were all born yesterday.
newgalileo
The "Two Meetings" are the largest meeting of billionaires in the world, detailed already in my 2012 book "Toxic Capitalism". Nothing new here. In China, money talks, through the "black collar" people. It would be utterly naïve, the least to say, to underestimate their influence. On the other hand, I think President Xi is slowly finding his way around those vested interests blocking many of the needed reforms.
whymak
A reader quotes 0.25 Gini for Ukraine, which is likely absurd. Should people who can't tell what's media misinformation be given the right to vote?

Here is how I teach the meaning of Gini to a HK schoolgirl:
1. In imperfect societies, anyone making more or less money than average wage is theoretically unfair. To measure the degree of unfairness, we proceed as follows.
2. Divide the population with various average incomes, $10,000, $15,000, $20,000 and so on into difference groups (range). For example , 1000 has $10,000 and 300 has $15,000, etc. Plot this into a histogram with the horizontal axis for groups and vertical axis for group average income. The horizontal intervals now have different values: 0 to 1000, 1001 to 1300, etc.
3. Find the average income for the population. This is done by dividing total area under the histogram (total income) by the population.
4. List the excess (deficit) area above (below) average income for each income group. Sum the (absolute) values of these areas.
5. Divide the number obtained in (4) by the total area (total income). This is the Gini coefficient.

50 Ukrainian oligarchs own wealth equivalent to 85% GDP. Using productivity estimate of capital, their income is about 15% GDP. With a histogram of only 2 intervals – with everyone else having the same income, the lowest Gini limit is 0.3.

If my student gets the correct answer with what's given, she will get an A in HKU matriculation exam.
impala
I'd be the last one to defend the top echelons of the CCP, but the NPC has nearly 3,000 members. If 86 of them are 'yuan billionaires,' we are talking about a mere 2.9% of total. The CPPCC has even more members, so 69 billionaires amongst them makes for an even less shocking percentage. Hardly 'a billionaires club.'

In such a small sample, average wealth figures are also meaningless. It only takes a single very, very (very indeed) wealthy person to drag the average up by miles. Hong Kong's average GDP/capital looks good too, until you realise how far it deviates from the median, and what an enormous inequality it masks. Talk to us about the median instead, or percentile wealth/income vs general population.

Either way, are lot of very 'interesting' questions to ask about the wealth of many CCP politicians, but throwing these kind of meaningless numbers ('89 yuan billionaires out of 3,000 members, gosh!') around is cowardice.

Name and shame Mr Lo, don't hide behind empty statistics. Both the NYT and Bloomberg News have done a lot of real revelatory investigative journalism on CCP princelings and other suspiciously wealthy Chinese leaders in the past year or so. How about you and the SCMP follow that lead?
lucifer
1 billion Yuan is USD$163 million, which is an astronomical amount of money.
In 2010, The average annual household income in China, converted to dollars, was $10,220, compared with $84,300 in the United States.
Your figures sound nice, but they distort a very clear picture.

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