POLITICS – Interests of Conflict Weekly Digest #1

Watch out Hemlock! As of this week, Hong Wrong has a new contributor. ‘Tony Wong’ is our unimaginative pseudonym for an anonymous political commentator who, for months, has been responding to local news stories in his ‘Interests of Conflict‘ mailing list. Wong says that the newsletter is aimed at informed residents “who are encouraged to further develop and rebut the arguments made here, and in the media, to create actual, honest and productive political dissent.”

Hong Wrong will publish a select digest of his musings each week. You are free to distribute and republish anything you read here and can sign up to the daily newsletter by emailing ‘subscribe‘ to [email protected] If you sell your opinions, do so at your own risk, there might be a conflict of interests.

  • Hong Kong’s taxi fares are about to rise by approximately 10%, or 2 HKD for the beginning of the trip and 0.1 HKD for each additional 200 meters. The change will take effect on December 8. Getting the price right for taxis is almost impossible. If it is a little bit too high then passengers switch to other forms of transportation, leaving taxi drivers on the side of the street, unoccupied, jamming the roads and polluting the air. If the price is too low then not enough taxis are available, people have to wait for a taxi and can no longer rely on them… The other variable that changes is the price of the licenses, though that can go either way. Higher prices could mean higher revenues per ride, but that could be offset by fewer rides per day. It remains unclear why this market is still stuck in Stalinist times. In today’s world it would be easily possible to use technology to call a taxi. You set your start and end point, push your request to a platform and allow various taxi drivers compete for it. You will get back several suggestions differing in departure time, travel time, vehicle type and price, could chose according to your preferences and enjoy the price chilling effect of competition and innovation.

  • The CEO of the Hong Kong Exchange is visited by some Dickens-like ghosts this week that enlighten him how the Exchange should or should not be run. It’s a hilarious read and pretty much the best reminder why the local exchange is not quite Wall Street.

  • Alex Lo complains in the SCMP that the quest for democracy is far too much driven by nobility and principle, and far too little by what he calls “winning and leading”. Lo believes that people do not care about the Basic Law or ‘international’ standards of democracy and believes that ‘democracy camp’ should be just a name for just another gang that with whatever means tries to aim for power, fame and whatever else might be attached to the iron throne of the Chief Executive. Lo’s persistency to tell us he finds ‘The Principled’ appalling is shocking, but rare in its honesty. Most women and men blindly grabbing power wherever they find it would also portrait themselves as principled and noble. The only politicians I have come across that claimed to be in it for the power were those from satire parties. That might be because it simply does not make sense to argue that democracy is about anything else than principles. Why respect elections, election promises, separation of power or freedom of the press if it’s all about ‘getting things done’ and ‘leadership’? Politicians generally keep up their facade of principles not because it is the only thing that saves us, the citizens from them, but because it is also the only thing that saves them from each other, from violent intrigues, fraud, blackmail all the way to coup d’états. We can only look forward to Lo’s column in which he explains to us what he expects of a democratic leader.

  • John Carney reports in the SCMP about a bar in Happy Valley that lost its liquor license. The bar’s plight quite well illustrates the constriction of the liquor licenses. Establishments are more or less delivered to the powers of the licensing board that can decide whatever it wants with little to no oversight. Many bars never obtain these licenses, especially if they are not quite the ordinary British pub-type, but rather promote a more local, independent atmosphere, possibly in combination with non-pub activity like arts and culture. Hypothetically a free city allows you to do whatever you want with your property, may it be in an industrial building, a parking lot or your own home, so as long as you do not interfere with the rights and property of your neighbours. The liquor licensing laws however have allowed the government a way to micromanage our private after-work lives. It is speculative, but it seems that establishments whose only purpose it is to serve alcohol are still seen as suspicious by the very boards that should know best what goes on in them. Restaurants have no problem selling beer at a fifth of the price, late into the night. Ironically, you only need a liquor license in Hong Kong if you sell open containers. Only then do you need to bewitch the licensing board, and only then are you forbidden to sell to minors. The convenience stores and supermarkets don’t need said license and can legally do whatever they want, no matter how young their customers and plentiful the noise complaints.

  • Jony Lam writes in the China Daily one of these pieces that get you laughing and confused at the same time. It opens with: “The Arabic word for youth is shabab; a group using the word as its name gunned down over 60 people in a Kenyan shopping mall last week.” Uhm what? Lam had apparently visited one of the Communist Party’s front organizations, the ‘Hong Kong United Youth Organization’. Lam is both convinced to have found a competent representative body of Hong Kong’s youth, but is at the same time crept over with self-doubt, given that these young people not at all resemble those that she got to know from Mong Kok, TV series and upscale shopping malls. She comes to the conclusion that everyone who missed the meeting for any other reason than shopping is probably some ungrateful hippie who deserves to starve away alone under the HSBC building for not appreciating our rule of law.

  • The SCMP tries again in its anonymous editorial to convince the world that obedience and opportunism are the driving forces of humanity, and that whatever anonymous business owners say hurts their business, we must refrain from. There is no such thing as a non-political city, as least not one that also has a government. I would love to see non-political cities arising, but it hasn’t happened yet. Hong Kong’s international reputation does not stem from it bowing to Beijing whenever they call, it stems from the individual’s freedoms and rights that allow it to be a safe place for everyone seeking to establish, run and join a business, seeking employment or education, regardless of their political views and family acquaintances. Quite possibly the SCMP will see this mechanism in place soon enough when their obedience and shoe-shining is unexpectedly unrewarded by the public looking for a reliant and critical newspaper that does not need to hide it’s pro-government advertisements behind anonymous editorials.

  • Adrian Wan reports from Beijing in the SCMP about Wang Guangya, director of the Hong Kong and Macau Affairs Office who allegedly complained about how Hong Kong handled the ‘baby formula issue’. I not at all understand what Wan or Guangya mean by that, as the restriction on the export of baby formula should not exactly come to the disapprovement of Beijing government officials. If they would agree with their citizens that Chinese made formula is unsafe and too expensive, then why keep up the import restrictions on foreign formula? China has a big interest in keeping its markets shut from foreign producers, and that certainly includes the food industry. Hong Kong being a free port can import as much baby formula as it can find on the world market, so it would not have to worry about a few cans disappearing to the north. With the export restriction Hong Kong was effectively enforcing Beijing laws, because the authorities on the Shenzhen side seemed unable to do so… This announcement comes amid the rumours that Hong Kong might in fact scrap the limit on exporting milk powder in time for the National holidays. This has been announced already on July 3rd when the government urged local suppliers to increase their imports. This places the burden of enforcing Chinese laws back on the Chinese, and might in fact be a better explanation of why Beijing is ‘displeased’ with how Hong Kong handles the situation.

  • Ada Lee reports in the SCMP that taxi drivers have struck a deal with the license owners to share the profits arising from the fare hike that will take effect in two months. The article isn’t at all specific and rather speaks of demands by taxi drivers than negotiations between them or even agreements. Such a deal sounds rather unlikely. What incentive do the owners have to share the profits? Taxi drivers exist in abundance, and unlike the license owners they are unable and forbidden to unionise (cartelise) themselves. A taxi license owner wouldn’t have to pass on a single dollar of profits to the drivers, because they could always find someone else driving for a dollar less… On the same subject, Ming Pao (translation courtesy of the great people at realnewshk) writes about abandoned taxis in various parking lots around the cities. This is classic monopolistic behaviour, to restrict supply to increase the overall income. This is of course much harder in the taxi business than in the supermarket business, as prices and everything are tightly set by the government. To assess whether that strategy would work or not, we would need to know on what basis the government implements fare increases. That is much more difficult than it seems. The obvious answer, ‘to keep up with costs’ isn’t so obvious at all. The only indicator that costs have risen by too much would be that taxi operators voluntarily withdraw from the market because they can no longer maintain a profit. Given that licenses are still worth millions however is a strong indicator that there are still profits to be made in the taxi business. So why raise prices? To keep the taxi license bubble going? To give in to lobbying demands of taxi license owners? 

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