In Hong Kong, you cannot buy the books you want your children to read, sell the books you believe readers will enjoy, exchange loose coins for your favorite newspaper, rent your restaurant out to those who want to book it or give away candle freebies to your loyal customers. You also cannot host concerts by artists that fans want to hear, broadcast radio programs favorable to listeners or screen movies with obvious resonance to local audiences. Disincentives to these expressions of economic freedom start at spurious inspections and escalate to abduction by Hong Kong authorities.
What is more, as economists and marketing experts observe the growing importance of company and brand values to inform purchasing decisions, Hong Kong has corroded and criminalized the “yellow circle” system by which consumers could locate and monetarily support the businesses whose worldview best represents their own. While it once required disclosure of political risks and an appraisal of the economic environment for listings on its stock exchange, that has now been repealed, too. Acquiring information that facilitates accurate and unfettered investment and purchasing choices is therefore becoming increasingly fraught.
At the same time, over $1.6 billion in public funds — whose direction citizens cannot influence by voting — has been channeled into a national security policy that people neither need nor desire and bankrolling extravagant celebrations for events that do not represent them. Monetary resources are diverted for the revision of academic curricula in the government’s interest, and vast top-down projects are being drawn up at great expense to merge Hong Kong with a city that there is no choice but to join. These can create large potential market inefficiencies.
Other methods of allocating resources through money, such as by donating to NGOs for them to distribute on your behalf according to their knowledge, insight and expertise have also been derailed, and we may soon see a day where people are prevented not only from streaming their favorite songs through the services they pay for but also blocked from deciding what they would prefer to do with their own internal organs, leave alone their salary.
None of this sounds very much like the ideal of the free economy. Artificially deprived of both information and choice, in today’s Hong Kong, homo economicus has a very stunted environment in which to make rational choices, maximize utility and steer his or her society to the best possible outcome as a result. Indeed, one may expect poor economicus to go the same way as the whales that visit the city from time to time.
Incomprehensibly, none of these truths has prevented Canada’s Fraser Institute, an influential think tank, from once again ranking Hong Kong as the second-most economically free territory in the world, above numerous countries and jurisdictions where people can actually buy what they would like own from businesses that are not being stifled for political reasons.
It has done so in its annual Economic Freedom Index, despite explicitly recognizing that personal choice and voluntary exchange are cornerstones of economic liberty. It also knows full well that its blinkered evaluations of Hong Kong as the world’s most free economy in previous years have been capitalized upon by the Chinese Communist Party for propaganda purposes.
True, on this occasion, the Fraser Institute has demoted Hong Kong from the number one spot for the first time since its index began in 1975. True, its data is from 2021, when not all of the above-mentioned examples of narrowing economic freedoms had manifested. And, true, it has accompanied its conclusions with a warning that Hong Kong’s standing is likely to diminish more precipitously in the future, because the city “continues to suppress freedom of all sorts.” It also acknowledges erosion of judicial independence, interference in the rule of law and partiality of the court system.
Nonetheless, aside from the gap between the 2021 data points and 2023 publication rendering its conclusions useless, the Fraser Institute still somehow managed to assess Hong Kong’s police and crime situation as among the finest in the world, even after the police had unleashed a crime wave upon their own people via brutal beatings, spurious arrests and suspect testimony, not to mention raiding and crumbling at least one powerful and legitimate business.
Apparently, this was economically preferable to neighboring Taiwan, where nobody was at risk of being clubbed, shot or dragged into prison for expressing an opinion. Likewise, Hong Kong’s property rights and legal system — whereby 47 democrats had already been charged under the National Security Law — was also considered superior to that of Taiwan, as was the freedom of movement of its people and capital, interesting news to those who escaped Hong Kong only to find that HSBC had frozen their pension savings on behalf of China. So much for the “soundness” of their money, which the Fraser Institute assessed as equal between Taiwan and Hong Kong, too.
True to form, when it would do well to shut its mouth and thank its lucky stars for a more than fortuitous placement on 2023’s Economic Freedom Index, the Hong Kong government instead tried to bash its way to the number one spot for next year. “The allegation against the independence and impartiality of our judiciary is totally groundless and unsupported by objective evidence,” it said, without irony. “The Fraser Institute’s claims that the [m]ainland imposed new and significant barriers to entry, limits on the employment of foreign labor, and increases in the costs of doing business in Hong Kong are factually wrong. We totally disagree with such unfounded claims and express our disappointment.”
Thus, in the information fog of the 2020s, when, more than ever, people require honest governments and reliable think tanks to make accurate economic decisions, Hong Kong has one that promotes lies and the other that pedals fantasy. Far from freedom, that’s delusion, and the invisible hand that conjures it has an arm running straight back to Beijing.