After 30 years of evolution, the distinction between socialist and capitalist systems of the “one country, two systems” in Hong Kong is no longer the main point. The Chinese Communist Party’s (CCP) move towards a market economy is in some areas more radical than Hong Kong’s capitalism. Since the transfer of sovereignty in 1997, the Hong Kong government’s role in intervening in the market has increased significantly and is no longer the positive non-intervention policy it once was. Having gone through these 30 years of evolution, what exactly is the difference between the two systems?

The British legacy of the “establishment” was mainly reflected in several aspects: mercantilism, market-first approach, fair play principles, and bureaucratic rationality. In the past hundred years, we seldom heard of industrial policies, import substitution, export orientation, and “emptying the cage for new birds” strategy... Hong Kong is actually an exception to the Four Little Dragons model for economic success in East Asia in the 1980s. In Taiwan, South Korea, Singapore, and even Japan, the government played a dominant role in economic development. They provided tax incentives and financial support to promote industrial growth, and thus established a co-beneficial system of plutocrats and bureaucrats. Government officials direct financial institutions to make policy loans, and plutocrats reciprocate by sponsoring elections for politicians. In contrast, the “Administrative Officer (AO) Gang” in Hong Kong was more likely to play the role of a referee than a player in the field, due to their “depoliticization role.”

After 1997, Tung Chee-hwa represented the economic ideology of the CCP: government-led economic development, including the introduction of industrial policies and various infrastructure blueprints, which were then gradually incorporated into the national development plan. This government-led model was in fact incompatible with the mercantilist and British civil service system that had been in place for over a century. The last Financial Secretary of Hong Kong of British descent, Sir Hamish Macleod, proposed the concept of “consensus capitalism,” in which there is a consensus between the government and enterprises that the market takes precedence and the government’s role is to maintain market order. However, for the new SAR government, which was blindly pursuing great success and development, the AO Gang suddenly turned into a negligent and passive resistance, and this was how the so-called “Tung Chee-hwa vs Anson Chan Controversy” came about.

If the big and small development plans put forward by patriotic politicians were supported by the public, the AO Gang would not have been able to stop them. Regrettably, these fake patriots, true garbage merely knew to state their positions. These politicians who lived on political welfare had no political discourse and did not have the ability to connect with the masses, so they just became a group of half-hearted public servants wasting efforts. The new set of governance failed to form a social consensus and build up authority, while the old one was gradually disintegrated by the erosion of power, thus resulting in the fragmentation of power and the rise of the opposition. If you analyze the situation closely, you will find that the CCP had never shared power with the pan-democrats in Hong Kong. The so-called filibuster to hinder the development of Hong Kong was unwarranted. The core of the problem remained to be the lack of authority of the SAR government and the amateur sundry mix of patriotic politicians. Beijing has now taken the lead in suppressing local interest groups, eliminating the opposition, and removing the internal checks and balances in the SAR system. Could this be creating order out of chaos?

This kind of political campaign as a method of governance from the Mainland may be effective in the short term, but in the long run, it will revert to the state of loyal garbage and the negligent AO Gang ruling Hong Kong. If the land reform in Hong Kong is carried out immediately and with much enthusiasm, it can deter the landed gentry and developer hegemony in the short term. However, the campaign cannot be sustained in the long run, so the situation will eventually revert back to bureaucratic control, and then it will return to the patriots fighting with the AO Gang again, ceaselessly. From the dispute between Tung and Chan in 1997, until Tung’s departure and Donald Tsang’s arrival, then Leung Chun-ying’s exit and Carrie Lam stepping up, all of them cannot be separated from this central issue. This is the real primary problem of one country, two systems. To say that the main conflict in Hong Kong is the “seizure of power and counter-seizure of power” is looking at the issue too superficially.

(Simon Lau Sai-leung, political commentator)

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