I have a dream of ending inequality

Hong Kong has a wide disparity of wealth. Many reasons have been given, but perhaps it is time to look at a solution that is free of ideology

PUBLISHED : Sunday, 09 September, 2018, 7:16pm
UPDATED : Sunday, 09 September, 2018, 10:40pm

Hong Kong has more ultra-rich people – those with at least US$30 million – than any world city, according to a survey by global research firm Wealth-X. I am not sure that’s something to boast about or despair over.

Unsurprisingly, with a Gini coefficient of 0.539, we are among the most unequal societies in the world. Just from this basic fact of inequality, social scientists can predict certain characteristic social failures of a wealthy society, even if they know nothing else about it: high inequality makes societies and countries dysfunctional across a wide range of social outcomes.

This conclusion is based on research across continents, over many decades, involving hundreds of individual studies and surveys across multiple disciplines. A useful summary can be found in The Spirit Level: Why Equality is Better for Everyone, by two British epidemiologists Richard Wilkinson and Kate Pickett.

It is predictive regardless of whether the societies in question are democratic or not. It applies to all Organisation for Economic Co-operation and Development (OECD) member states and individual provinces or states within a country: the higher the inequality, the worse outcomes they score in the standard matrices for poverty; social trust; mental and physical health, and the delivery of public health services; social mobility and job opportunity; and education performance and attainment.

Hong Kong surpasses New York as home to the world’s biggest population of ultra-rich people

Material wealth, social failure: Doesn’t it sound familiar for Hong Kong? Of course, other explanations have been offered. One, articulated by local economist Leo Goodstadt, in his book A City Mismanaged: Hong Kong’s Struggle for Survival, is that the city was mismanaged by the post-1997 government.

Another is advanced by the opposition. It is that frustrated democracy and eroding autonomy has enabled what amounts to “societal wealth theft” by a cabal of tycoons and other powerful vested interests.

The opposite argument, put forward by the establishment, is that Hong Kong has failed to take advantage of China’s phenomenal rise – thanks to the obstructionism of the opposition – and is being left behind.

There is some truth in all three, but it’s worth considering an ideology-free approach, at least in terms of our local political debate, though it clearly favours a “liberal-leftist” solution for Hong Kong.

Put to use the government’s almost HK$2 trillion reserves, along with some of the annual land sales revenue currently reserved for infrastructure development, to improve social outcomes across all the domains of inequality.

I know I am dreaming.