HK approaches peak white-elephant orgy

In case you missed them, the public holiday brought us two little reminders of Hong Kong’s place in Beijing’s scheme of things.

Five days ago, our top officials were pleading ignorance of the opening date of the Hong Kong-Zhuhai Mega-Bridge. In classic condescending-Hong Kong-bureaucrat-lording-over-peasants fashion, Transport Secretary Frank Chan brushed away suggestions that the white-elephant project would open towards the end of the month. He – and the rest of us – has now been notified that the big day will be October 23.

We still don’t know whether this means traffic will start flowing on that day, or Chairman-of-Everything-for-Life Xi Jinping will simply cut a ribbon at a non-opening opening ceremony. So Frank could, in his own little inadvertent way, be correct, strictly speaking. The point is that our government knows no more about what is going on than anyone else.

The vast link, with three lanes in each direction, will be the World’s Biggest and Longest Slab of Concrete Over Sea in the History of the Universe. It will also almost certainly be embarrassingly under-used. Of the three cities it connects, only Zhuhai and its hinterland has capacity for extra traffic; Macau’s road network is totally full, as is downtown Hong Kong’s. Apart from buses going back and forth, and presumably some trucks carrying containers full of Hello Kitty phone cases, it is hard to see who will use it, especially given the ‘fast and convenient’ permit system for car owners.

The South China Morning Post laboriously describes the thing as part of the Greater Bay Area Hub-Zone Branding Concept. But it is actually the other way round – ‘Bay Area’ is an extension of the bridge project, which came first as a symbol if not means of integrating/absorbing Hong Kong into the Mainland.

This will be the second approx-HK$100 billion pointless-infrastructure fiasco inaugurated within a few weeks, following the West Kowloon High-Speed Rail Vibrating Express Line Hub (which at least has some potential use for those of us with an urgent desire to get to Wuhan). It also comes in the midst of the uproar about the Trillion-Dollar Sandpit Lantau Reclamation Wacko Proposal. We are surely hitting Peak Taxpayer-Wealth Destruction Orgy.

The second reminder of Hong Kong’s place in the Communist Party’s world comes from the peculiar goings-on at a gathering of Hong Kong’s pro-establishment tycoon-owned media bosses in Beijing.

They were supposedly summoned to celebrate the 40th anniversary of China’s opening. But they also received a lecture from a CCP propaganda chief demanding (if we read between the lines) that they censor or tailor their coverage to help keep Hong Kong from becoming a base for hostile forces that threaten the nation.

The media folk were told these comments were off the record. But their social-climbing name-dropping instincts naturally got the better of them, so it became a news story back in Hong Kong. The exact chain of events probably varied from one outlet to another, but in general it seems the panicky belated pre-emptive shoe-shining then kicked in, and the story was pulled. Realizing this made them look even more stupid, some ran a discreet version (not for the print edition, obviously).

Most observers assume that the CCP propaganda department is referring to the pro-independence/FCC issue. But its officials are probably thinking of how the local press could improve their understanding of ‘Xi Jinping News Thought’ with regard to all sorts of subjects, such as Xinjiang prison camps, speculation about factional squabbling among CCP elites, or analysis of China’s economic problems. Anything, really. Beijing is telling the Hong Kong establishment media to start getting used to closer guidance. Mainlandization means ‘you do what we say’.

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A mid-week Great Leap Backward

Half the MTR system seizes up this morning. But Transport Secretary Frank Chan has a chauffeur-driven car – so everything’s fine. So long as you can get to Wuhan in three hours at Mach 0.8.

Meanwhile, up in the Motherland… The abduction/arrest of Interpol president Meng Hongwei has damaged China’s image (in stark contrast to all the non-stop cool and hip fun that has been enhancing the nation’s reputation recently). Was this simply the grabbing of another crooked official that was clunkily handled and leaves Beijing looking clueless or disdainful about what foreigners think? Or was it a swift pre-emptive strike against a genuine and acute political threat to the regime?

The South China Morning Post’s Wang Xiangwei sees it mainly as an example of bad PR – just a routine elite-bribery arrest that would be no biggie if it weren’t for the arrogant and heavy-handed approach of the anti-corruption system.

Another SCMP piece argues that it is a bigger deal, concluding Xi Jinping’s methodical purging of the security apparatus of Zhou Yongkang’s people. It does look like part of an extensive pattern. But if it’s so methodical, why the sudden recall and disappearance of the guy, embarrassing China before the world? (Perhaps just that ‘bad PR’ problem. Beijing has contrived a relatively clever ‘ethical high ground’ spin about how the unseemliness of the arrest is proof that no-one is above the law.)

The other theory is that this is a major incident, countering an attempted ‘soft coup’ against Xi by Jiang Zemin’s faction and other malcontents. The aim would be to restrain the Chairman of Everything for Life, rather than overthrow him. These forces oppose Xi’s concentration of power because it harms the nation’s well-being, also known as their families’ accumulation of wealth.

The fact that no-one can tell which (if any) of these explanations is accurate underlines the absurdity and scariness of what is supposed to be the world’s number-two country. I declare the mid-week mini-weekend open with a big read on how Xi is overseeing a Great Leap Backward. It is a picture of greater uniformity and rigidity, the closing off of China from the world, and of significantly greater risks of mistakes – a picture in which Hong Kong’s gradual decline is just a speck.

 

 

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Trying to take the half-trillion boondoggle seriously

I’m not sure how many people turned out Friday to protest the barring of Lau Siu-lai from the election ballot, but it was a fraction of the number who marched yesterday against the Lantau mega-reclamation white elephant. And while the former gathering was a ritual for the same old (and young) faces, the latter was a relatively spontaneous display by what looked like some mainstream pissed-off middle-class families.

The government is proposing to spend half a trillion dollars on something – land – that we already have (for example, the unmentionable barely used firing range zone around Castle Peak is far bigger than the proposed reclamation). The official rationale is that assembling and consolidating under-utilized sites in the New Territories is too much hassle. But seriously, how much hassle is worth half a trillion? This is like buying a far pricier apartment to avoid having to clear out a spare room full of junk.

Some minor bureaucratic mendacity is backfiring nicely here. For years, officials have split and recategorized various funds to make the city’s accumulated surpluses look smaller than they really are. If they had been honest, they could now have been proposing to blow a mere quarter or a third of our savings on this boondoggle – but they massaged the total from HK$1.5-2 trillion down to HK$1 trillion, so now they must live with the mega-reclamation scam swallowing ‘half our fiscal reserves’.

That’s enough to enrage an average household. These protestors and their kids are also clued up about the environmental side, notably the rising sea levels that make this project look like a seriously dumb gamble.

On top of that, maybe more and more people are getting the message that the whole housing/land problem is a con. Post-1997 administrations have created a housing crisis by design – to enrich cronies and/or to fulfill Beijing’s long-term demographic and integrationist strategy. The government now seeks a fake ‘solution’, which will also happen to enrich cronies and/or further ‘One Country’ policy.

The anti-‘Lantau Tomorrow’ march was not huge, but it should worry officials trying to push the ‘half-trillion paddling pool’ project.

That’s assuming they really are trying to push it. The whole idea almost looks too preposterous to be real. In proposing it, Chief Executive Carrie Lam is side-lining her own pet (rigged) task force on land supply with its own smaller-scale reclamation concept – a strange breach of her usual bureaucratic procedural inflexibility. The apparent mastermind of the extravagant Lantau mega-vision is ex-CE Tung Chee-hwa’s Our Hong Kong Foundation tycoon think-tank, which enlisted pop star Andy Lau for an easily-mocked intelligence-insulting promotional video, which smacks of desperation.

Something smells weird here. Plenty of conspiracy theory, like the male cabal backlash against Carrie (though she could be setting them up). Unexpected popular opposition adds spice to the mix.

This looks like the supreme test for seasoned cynical skeptics: do you believe Beijing, the ultimate ruler in all matters, would sanction such an egregious and deranged way to hijack Hong Kong’s wealth – or could the CCP think of something better?

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Verb – ‘…typically to separate out sediment’

Sesame Street today was brought to you by the word ‘decant’, in the sense of urban planning, ethnic-cleansing or forced migration – as in ‘the decanting of Yau Tsim Mong’. I recall the word being used a few weeks ago by the Our Hong Kong Foundation folks pushing the Lantau mega-reclamation proposal.

The way they put it, it makes sense to have a large-scale ‘decanting’ of residents of older neighbourhoods approaching the end of their useful life (the buildings’ useful lives, that is, not the residents’ – or then again maybe not, ha ha). Much better than itsy-bitsy one-block-at-a-time redevelopment, because you can scrub everything for miles around and create a lovely big holistically-designed futuristic urban paradise, with trees, open-air cafes, flying cars, etc.

The linked comment above reflects a suspicion that the developers want the HK$500 billion Lantau metropolis as a way to shovel the poorer residents out in order to convert old downtown districts into sprawling luxury apartments. The reason we haven’t heard more about this is that the rest of us just assume it’s the case and don’t bother with wishy-washy suspicions stuff.

That said, a 20-year strategy for the mega-gentrification of the older core urban areas would rest on some bold forecasts –  essentially that the huge historic 1980s-2010s uplift in Hong Kong real-estate values will continue on a straight line for decades more. Yet the trends for China’s economic growth and demographics, and for Hong Kong’s distinctive advantages, if anything point the other way.

If our 92-year-old property tycoons are thinking this long-term about the high-margin ‘luxury’ apartment market, they might prefer a continued tight supply of new land to a situation where half of Kowloon is emptied and (horror!) they might have to compete to sell a commodity product. Of course, they also control much of the construction-supplies and sub-contracting cartels, so they have plenty of other reasons to welcome the Lantau mega-reclamation project.

To repeat: such a massive diversion of Hong Kong’s fiscal reserves comes down to Beijing. If the CCP has its own reasons to ‘decant’ Hong Kong’s wealth this way, the half-trillion-dollar pile of dirt will happen. Otherwise not.

The Decanting of Yau Tsim Mong – good title for an extremely gory horror movie.

I declare the weekend open with a farewell – Victor Mallet has left the building – and a heart-warming ray of sunshine in the form of Prada shares falling 10.5%.

 

 

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Time for One Last Ginormous Grab?

The Chief Executive’s policy address is an annual Hong Kong establishment ritual to distract the populace from the incompetence of their supposed elites. Participants engage in mutual shoe-shining by apparently taking vacuous rubbish seriously – a sub-category of the art of ‘giving face’.

The government mounts high-profile make-believe consultations with the usual ‘various sectors’. It then, with great fanfare, releases a list of measures that are pre-determined, inconsequential, sloppy and/or self-serving, plus some blatant populist PR stunts, and a few lame cop-outs. The media devote major space to it all, portraying it as Hugely Momentously Important in terms of vision, principle, determination and either meeting or dashing public expectations.

This year’s is here if you want, with all the cartoons and leaflets here. It comes just as Hong Kong is visibly and undeniably starting its slide into Mainlandization, hence the desperate and depressing slogan ‘Striving Ahead, Rekindling Hope’. We considered ‘Keep Calm and Carry On’, but it sounded too cheery.

The main theme is the ‘heavy focus on finding new land for housing’. By ‘new land for housing’, we mean ‘new ways to divert billions into the pockets of the usual cronies’. The vested interests are the big overlapping bunch of circles you get in a Venn diagram of Hong Kong’s domestic economy by ownership – property development, real estate, construction/engineering, tourism/retailing, etc.

These guys see the mega-white elephant projects now coming to an end. They no doubt foresee Hong Kong gradually losing some of its rent-seeking potential as it becomes more Mainlandized and integrated into the Bay Area. They probably also sense that the whole Historic China Growth Miracle story is over. There’s still time for One Last Gargantuan Grab to get their hands on HK$500 billion-plus from the reserves – but they need to think big and quickly. The plan is to leverage anger about today’s housing situation into support for a vast reclaimed artificial island off Lantau.

Chief Executive Carrie Lam seems eager to deliver. But there’s a lot of things that don’t or might not add up.

One: it’s a 20-year project, and therefore has nothing to do with today’s housing affordability problem. It is aimed at providing homes for 1 million people, which is the same number of new settlers Beijing has sent to Hong Kong in the last two decades. Who is this designed to make space for?

Another: the fact that reclamation is administratively simpler than converting farmland highlights the stupidity of land policy rather than the benefits of reclamation. The more extreme the answer to a ‘problem’, the more people should ask if the problem is real. The price tag for the Lantau Dream Future Paradise Vision Project should be screaming ‘land is already there if you want to use it’.

A third: the local property market is at silly valuations (US$1 million basic apartments vs median household income of US$40,000). Even minor interest-rate and US-China trade problems are now causing jitters in the market, and a bubble-burst in the Mainland or other large-scale shock would expose Hong Kong’s housing shortage for the man-made fake crisis it is.

Bonus snag: rising sea levels?

If this proposal is mainly the local/international tycoons and engineering interests trying the ultimate crony-scam to end all crony-scams, they could be disappointed. But if Beijing is on-side with its own companies’ slice of the action and the demographics/migration angle, this mega-reclamation will go ahead. Worst case: our descendants get the world’s first and only 1,700-hectare outdoor paddling pool (‘Wade from Kennedy Town to Mui Wo!’) Whatever happens, it can’t be as useless as the bridge to Zhuhai.

 

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Another CCP ‘hearts and minds’ victory

The Liaison Office – Beijing’s shadow government in Hong Kong – nowadays readily orders the city’s administration what to do. It then sits back and leaves it to the local puppets to clean up afterwards.

From the Chinese party-state’s point of view, expelling correspondent Victor Mallet from Hong Kong would seem like a straightforward Sledgehammer Freak-out Panda-tantrum job. But hapless Chief Executive Carrie Lam has to take ownership of the decision, and bear the resulting attention, questions and general uproar. The reaction has been fierce – perhaps, to the Mainlandization-jaded, surprisingly so.

The Financial Times is going to appeal the refusal of Mallet’s visa. This is presumably futile (‘Immigration Department Admits Error, Blames CCP Pressure’). But it will keep the local administration sweating.

Carrie faces other demands, including from overseas diplomats, that Hong Kong give a reason for the rejection. She will not give an answer (though if Mallet had been dodging taxes or shoplifting at Wellcome, it would’ve been leaked). Indeed she cannot specifically say whether or how the media can handle ‘independence’ as a subject.

Mallet did not break any Hong Kong law. He transgressed only in the ‘rule by law’ sense that enables the Mainland regime to declare enemies guilty of whatever it feels like. Not surprisingly, the press, legal and human rights lobbies are stressing this ‘rule of law’ as much as the ‘press freedom’ side of the controversy. This angle is more sensitive for the business and wider community in Hong Kong. Thus more reason for local officials to sweat.

The affair is damaging Hong Kong’s reputation, with most mainstream international press picking up the story. Keith Richburg writes that ‘The death of Hong Kong’ is now a thing – and that’s in Inkstone News, a South China Morning Post title tasked with making China look oh-so cool and hip.

So poor Carrie has to deal with this mess, like it has anything to do with her. Meanwhile, the Liaison Office drafts its ‘mission accomplished’ report to the big bosses back home.

 

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Time to drop your pants

The United Front tacticians must be delighted: Hong Kong, China’s expulsion of the Financial Times’ Victor Mallet is forcing bystanders to pull their pants down and reveal their true ideological positions. Fence-sitters reluctantly and tortuously take a public stand for rule of law and freedom of speech, while the self-styled principled lose their spines and declare themselves loyal shoe-shiners.

An example of the former is the American Chamber of Commerce. In its initial response, its head (a former president of the Foreign Correspondents Club) gave the impression that bullying the press was no big deal so long as overseas companies in Hong Kong had a level playing field. (The local-establishment General Chamber’s guy opined that businesses don’t care about visas, yawn shrug sniff.)

After (we presume) some conscience-struggling, AmCham produced a statement criticizing Mallet’s ejection, while emphasizing its own non-political nature.

When the ‘One Country Two Systems’ deal meant what everyone thought it meant, there was no contradiction: an organization like AmCham fitted into Hong Kong’s ruling establishment naturally. Its businessmen-members could curry official favour by, say, joining in government Belt-and-Road blather, while local bureaucrats had no problem openly promoting Western values. Now that’s over, and you have to make a choice.

And this bring us to the other side – people who take pride in exhibiting some sort of independence and objectivity who are now awkwardly shuffling closer to Beijing’s new no-nonsense line.

Lawmaker Regina Ip has long managed to be pro-government while occasionally outspoken or critical, and apparently patriotic without being obnoxiously Red. It is calculated and cynical (which is why many right-thinking people can’t stand her), but it’s quite clever. Until it isn’t. She is now endorsing the Mallet visa decision as ‘reasonable’ because, put simply, she is screwed if she doesn’t. An even-handed I’m-above-this act is not an option.

She is hardly alone – the whole moderate establishment face this. Today’s South China Morning Post has an op-ed by a contributor who for whatever reason feels a need to be seen to back this latest step towards Mainlandization when he would plainly rather not. (Essentially, it’s miserable hand-wringing: ‘The FCC brought this on itself, Beijing has slapped its wrist, now can we all move on and be nice again?’) Not a comfortable read.

This phenomenon goes back decades. But as Hong Kong becomes more authoritarian, people will come under far more pressure to identify themselves as either cooperative or antagonistic towards Beijing. It will be interesting to watch public figures who hope they can carry on sitting quietly on the fence, and probably depressing to see how much the divide is along national or ethnic lines.

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Another week, another…

We need a snappy word for ‘big venture into authoritarianism’, because they’re becoming a regular thing.

The good news is that Hong Kong-based Financial Times correspondent Victor Mallet was not getting his visa renewed at the Saudi consulate in Istanbul (and hey – at least he isn’t/wasn’t president of Interpol).

The bad news is that by de-facto expelling him and implicitly intimidating overseas journalists and their press club, Hong Kong downgrades itself from First World to Third World as an international media hub – and that this is a fairly predictable step in the city’s ongoing Mainlandization. (Apparently ‘Mainlandization’ is a ‘vile label’. Wish I’d known earlier.)

Here’s a summary, a personal commentary, and a reminder that Chief Executive Carrie Lam is a hapless stooge here amid the emperor’s eunuchs and overeager minions.

A rule of thumb: when Carrie acts decisively, you know she is following orders from Beijing’s officials behind the scenes; when she dithers and waffles about committees and consensus and sectors, you can rest assured ‘One Country Two Systems’ and ‘high degree of autonomy’ are being respected.

Another rule of thumb is that the more exhaustive and breathless the coverage Hong Kong’s pro-establishment media give a local ‘political’ event, the staler and more meaningless the ritual. This week’s biggest snore is likely to be the Chief Executive’s Grand Blather Policy Address on Wednesday. Prepare for page after page of distraction from what’s really happening.

Meanwhile, the Genius No-Frills Cartoon of the Day Award goes to whoever created this…

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Fad comes to Soho, officially dies

Situated conveniently next to the Mid-Levels Escalator in the Soho Tacky Overpriced-Restaurant Themed Hub-Zone – a shiny new Bitcoin ATM. Could it be a hip, ironic art installation, mocking the follies of our era? Or is it a cynical ploy to lure shallow nightlife types who think they will look cool and glamorous using it as the world goes by?

I thought everyone had worked out by now that the space-age techie trendy edgy anarcho-libertarian cryptocurrency thing with its idiotic proof-of-work transactions on hyped-up blockchain was a silly fad, kept going only by gambling addicts/day-traders who thought technical analysis wasn’t voodoo.

The device likes HK$500/1,000 bills. If you have a largish stack of 1,000s and you’re too – shall we say – shy to deposit them at the bank, I guess this is one way to shift them. Downside: each transaction might take 24 hours (free canapes while you wait); Russian scammers might take it all; rather than being anonymous, there is actually a trail, by design; and the asset you are holding is just electronic blips of no intrinsic worth.

An alternative for the officialdom-averse would be to take your stack of cash to a friendly foreign-exchange dealer, jewelers or gold store in Central, who will be happy to convert it into some other medium if their slice is right. And this way you can help support one of Hong Kong’s pillar industries! Downside: no mojitos.

A couple of local items you might have missed…

Belt and Road (like Bitcoin, to be filed by history under ‘bullshit’) worms its way into the United World College at Ma On Shan courtesy of a local property tycoon’s donation. Guess they need the money. On a more uplifting note, a trailer for Last Exit to Kai Tak. This movie seems notable for two (related) things: high production values, and a treatment of Umbrella movement figures in a way that would repulse the pro-Beijing crowd as idolization. Wait for it not to appear at a screen near you anytime.

On the China front… Vice President Pence gets nasty with Beijing; the US Navy ponders a show of force against the PLA; and (this is all happening right now by coincidence, right?) Bloomberg gets a scoop on how China planted secret miniature chips in sensitive Amazon and Apple hardware.

I declare the weekend open with a modest selection of other recommended rabid red-baiting links. Students informing on ideologically incorrect teachers in the Mainland (how long before this comes to Hong Kong?) A good summary on how the CCP has focused on Oz and NZ for United Front operations. And to reassure you that not all Beijing influence-pushing is sinister but rather just about making money, how China is threatening the world’s health by promoting primitive supernatural non-science.

 

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No Article 23 needed

A not-bad column notes that the Hong Kong government ‘wants to shift understanding of free speech towards a more authoritarian definition’ and has the Legislative Council votes ‘to force through a draconian’ national security law.

Beijing officials and local Communist Party loyalists are openly saying that the government should introduce an Article 23 law against treason, sedition and other offenses, and they strongly suggest that this should criminalize even peaceful talk of independence and ‘self-determination’.

The Hong Kong government, mindful of the semi-uprising last time they tried to ram through a national security law in 2003, is resolutely devoted to dithering on this, bleating about ‘when the time is right’. It’s hard to believe local officials would publicly disobey Beijing’s requests, so we can assume the apparent tension between the two is a deliberate ‘good cop-bad cop’ act.

But it is probably something they have no choice about. To the CCP, accustomed to redefining laws to mean what it wants, Hong Kong’s legal system must be frustrating. And the local administration’s dithering is probably sincere – the poisonous Article 23 branding is guaranteed to provoke major protests.

So the authorities resort to chipping away bit-by-bit at ‘threats to national security’. It is gradual and inefficient by the standards of the Crush Everything Now approach used on the Mainland, but it causes less fuss.

And it’s hardly ineffective. Working within (and if necessary twisting or undermining) the existing legal and administrative systems, local officials have found ways to selectively prosecute protestors, use the police for political intimidation, bar dissidents from the legislature and ballot, and now ban a political group.

What’s next? Drooling, mad-eyed pro-CCP loyalists are now calling for the proscription of the HK National Party to be followed by a similar ban of the bigger and more moderate Demosisto. One measure that is just begging to then be taken is a requirement that all political parties and lawmakers declare support for CCP rule or cease to operate – the declaration to be rejected if a civil servant finds you are insincere. Another is the extended use of travel bans, as already imposed on Demostisto’s Joshua Wong.

As things get creepier, the authorities are likely to use surveillance far more (think ‘wanted’ posters of students spotted by CCTV erecting localist banners on campus at the dead of night). Public-sector workers like teachers and social workers might be required to sign loyalty oaths, with suspected bad elements blacklisted from employment. Maybe a ban on ‘humiliating’ media. More and more people will seriously shut up and keep their heads down.

It could be that Beijing, in its eagerness for a sweeping clampdown will push ahead with the all-embracing extra-tough national security legislation required by the Basic Law. If so, the opposition would welcome it as a rallying point for resistance. But if they are smart, the authorities will simply use Article 23 as a ‘looming threat’ to divert attention as the step-by-step Mainlandization grinds on.

 

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