Following last week’s visit to the alarming gap between what I need to live on and what our government thinks sufficient for the aged or disabled, I have been browsing in the works of Joseph Stiglitz. The interesting thing about Mr Stiglitz is that he is a Nobel prize-winner (albeit in Economics, a variation about which some of us are a bit dubious) so he can say things which would be instantly dismissed as extreme ideology if they came from, say, Noam Chomsky, Long Hair, or me. Like if the government consists of rich people it will govern in the interests of rich people.
Mr Stiglitz’s speciality is inequality and its economic consequences. Those consequences, as equality increases, are dire. A flourishing economy depends on purchasing power and the rich, though big spenders on a per capita basis, are not numerous enough to supply it. There are also social consequences. If society is very unequal then it is not working for the large number of people at the bottom of the distribution. They are likely to withdraw their support for the existing way of doing things. Is this beginning to sound familiar?
Mr Stiglitz’s third point, which is particularly relevant here, is that inequality is not necessary or inevitable. There are policies which are conducive and there are policies which are not. And contrary to the bleating about “competitiveness” which greets any suggestion that the status of workers or poor people should be improved, there is no evidence that societies which go out of their way to reduce inequality suffer in consequence. If anything the contrary is true.
In this context there was an interesting piece a few weeks ago in (I think) the New Yorker. This was written by a Finnish person living in New York, who complained that he (or possibly she) was fed up with Americans saying that Scandinavian social security systems depended on a high level of social solidarity found only in highly homogeneous communities and would consequently never work in America. This was based on the idea that Nordic social welfare arrangements involved a lot of people paying to rescue a few from poverty, unemployment, sickness and other social ills. This was not the case, said our Finn. Actually middle class people in Scandinavian countries supported social welfare systems because they benefited most people. Middle class families liked knowing that an illness would not bankrupt them, they liked knowing that they did not have to save for ten years to send their kids to university, they liked knowing that if they resigned, or were fired, from their current job their income would not immediately plummet to zero. People, in short, were willing to pay for a social welfare system because it was good value for them, as well as other people.
The conclusion from all this is that Hong Kong’s nearly unique combination of extreme wealth and poverty is not inevitable. It is not something like the weather which we just have to put up with. It is a choice. We, or our government, could pursue options which reduce inequality, or at least stop pursuing options which increase it. This is a livelihood issue, and we have a government which claims to concentrate on livelihood issues. Yet we see no progress.
One reason is that our leaders seem to have achieved a state of learned helplessness. No doubt some of them would blame this on the near-deadlock in Legco, and some of us would blame it on too much waiting to be told what to do by the Liaison Office. But there it is. In a recent speech Carrie Lam announced that the government’s current ambition was to tackle “three peaks”: MTR fares, the misbehaviour of the Link REIT, and reform of the MPF. She claimed that all of these presented great difficulties and success could not be guaranteed.
This is pathetic. The government is after all the government. It can change the law if necessary. The problem with the MPF is that the needed reforms will annoy some of the government’s friends. The problem with the MTR is that it is neither fish nor fowl, public or private. Either would be more acceptable. The problem with the Link REIT is that it was a stupid idea in the first place, but unwinding it would be embarrassing. These are all problems which resulted from previous government actions: the part privatisation of the MTR, the setting up of the MPF with bad rules, the sale of items previously owned by the Housing Authority to the international greed industry. What governments do they can undo.
Unfortunately this requires first that they should learn to accept responsibility for their own mistakes. Ms Lam seems to have problems in this area, as evidenced by her performance on the topic of lead in water supplies. Nobody will be held responsible we were told, because the problem was in the system and not in the actions of individuals. That may be true, but it does not settle the matter at all.
The “system” is not something for which nobody is responsible. Some part of the government is responsible for ensuring that public housing tenants have a supply of drinkable water. The higher reaches of that department or branch are populated by people who are not plumbers, and do not personally carry water. Their job is to ensure that there is a working system for delivering clean water and if the water has lead in it then they have failed. It appears that the Water Supplies Department has a successful system for delivering water to buildings and estates. The lead appeared in the local piping. The local piping was built at the behest of the government and it was the government’s duty to ensure that “the system” produced non-poisonous water in the resulting taps. I suppose that this duty rested with someone under the Development Bureau.
This suggests that under the “accountability” theory the buck would have stopped at the door of the Secretary for Development, Mr Paul Chan Mo-po. So we can now credit Mr Chan with surviving his fourth resignation-worthy scandal, which is probably a record. Has the man no shame?