My Take | Chinese bankers go communist – good for them

The sky must have fallen on China International Capital Corp (CICC), the country’s once fabled investment bank. That, at least, is the story told in a new Bloomberg report. CICC is still a big deal on the mainland, but its international presence has been curtailed, not least because of a deliberate state policy to crack down on unruly financial enterprises and to push for greater economic equality under “common prosperity”.

The country’s business elite has been taken down a notch or two while more than three out of 10 top bankers have become Communist Party members. That means they are subject not only to Chinese law but also party discipline.

The author of the Bloomberg report appears horrified while citing the reign of terror being unleashed on CICC where – horror of horrors – senior management have had their pay slashed by up to 25 per cent and most bonuses cancelled. It’s not just CICC, though. Across the financial sector, the big firms have asked senior staff to defer bonuses or even cough up past rewards.

I suppose that’s equivalent to cancelling Christmas in America. But what’s wrong with that? A serious financial crime could get you executed in China, though that is rare nowadays. While I am against capital punishment, I am all for long jail sentences. If only the United States would jail a couple of hundred of the top financiers and bankers most responsible for causing the last global financial crisis. That would clean up its financial and banking sectors in no time.

So now I realise why it all sounded so horrible to that Bloomberg writer. In the US, society serves finance. In China, it’s the other way around.

Granted, it doesn’t always work out that way. But by and large, the respective societal priorities are there in the US and China. And I go with the Chinese any day. There is no reason to pay financiers tens of millions and even billions while so many others barely make ends meet even when doing several jobs.

The Chinese way is supposed to be inefficient, wasteful and prone to corruption. That’s true to an extent, but the same can be said about the American way. Here’s the difference, though. In my own experience, Chinese are hypersensitive to injustices – especially when committed by officials and party functionaries – they see around them while Americans are so propagandised they barely recognise theirs, or even defend them as if injustices are part of the natural order of things. Feudal serfs were like that in medieval times, I read in some history books.