Jake's View

Hong Kong is the world’s freest economy? Try Somalia

What that title really means, is freest among those countries where governments suppress freedom in just the right measure to allow the greatest scope for individual initiative while keeping outright criminality in check

PUBLISHED : Sunday, 19 February, 2017, 2:49am
UPDATED : Sunday, 19 February, 2017, 2:49am

Hong Kong has once again beaten key rival Singapore to be ranked the world’s freest economy by a Washington-based think tank for the 23rd consecutive year.

SCMP, February 17

It’s nonsense, of course. The world’s freest economy is Somalia. It has no government, just rival gangs that cannot establish dominance over each other. If robbery is your thing then Somalia is your place. You are free to do whatever you want in the Somali economy.

Likewise Afghanistan as long as you pay lip service to the American occupiers when you grow poppy for the American drug market. Russia for a period after the downfall of the Soviet Empire also clearly held the title of world’s freest economy. It was a free for all, no holds barred, and the fittest won, dragging their knuckles along the ground.

So let us establish immediately that what the Heritage Foundation means is freest among those countries where governments suppress freedom in just the right measure to allow the greatest scope for individual initiative while keeping outright criminality in check.

Now I fully accept that the Heritage Foundation lies several light years to the right of Attila the Hun on the political spectrum and that American neo-conservatism with its love of dropping bombs on other people’s heads is a somewhat dubious school of thought. But I do sympathise with the underlying idea here that, although we must accept a little government intervention, it is not a good thing overall, and we must have no more of it than we truly need.

This is why it surprises me that the Heritage Foundation should consistently choose Singapore as the world’s second-freest economy and sometimes even its freest.

Let us get this straight. Singapore is the world’s first country to have achieved communism in the classic Marxist sense of the word.

Hong Kong pips Singapore to be ranked world’s freest economy for 23rd consecutive year

Public housing accounts for some 85 per cent of the total, the government extracts 37 per cent of everyone’s pay for a nanny fund in addition to taxes, and all business is under the direct thumb of the bureaucrat.

“Close,” says the boss to one bank and it goes out of business. “Open,” he says to another and, presto, a bank where none was before. It’s like the famous centurion of the Bible – “I tell this one, ‘Go’, and he goes; and that one, ‘Come’ and he comes.” Singapore understands the ways of command. Is this really the world’s second-freest economy?

Mind you, I don’t have that much different to say for Hong Kong. We have only 50 per cent of our population in public housing and our nanny fund takes only 10 per cent of our income but we have another HK$1.7 trillion in a special miser’s fund that our government won’t allow us to touch.

What then make Hong Kong’s the world’s freest and Singapore’s the world’s second-freest economies? Is the rest of the world then so heavily under the ball and chain of government edict?

I think the Heritage Foundation’s mistake is to confuse free economy and parasite economy. Both Hong Kong and Singapore are parasites that live by serving their immediate neighbours in doing what these neighbours cannot do for reasons of slower development or will not do for reasons of ideology.

This has meant different things at different times. At one time it was shipping and port facilities, then highly organised manufacturing, and now mostly capital flows and trade facilitation. Hong Kong launders money for mainland entrepreneurs, Singapore for Indonesian and Malaysian ones.

We, the two of us, Hong Kong and Singapore, are the robber barons of Asia. We have grown rich from the toil of others by skimming a little off all the business that passes our way.

And of course this makes us look like free economies. Parasites are free of the burdens of their hosts. They can afford to advertise that they have no chains. Others carry their chains for them.