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Hong Kong: When Is a Colony Not a Colony?

John Burns wrote . . . . . . . . .

The Education Bureau, responding to a Legislative Council (LegCo) discussion, has offered an official view – the bureau’s “stance” – on whether or not Hong Kong was a colony. Views had been expressed in the LegCo, the bureau pointed out, that “Hong Kong was not a colony.”

“We must base our interpretation of history on historical facts and refer to different perspectives,” the bureau wrote. Indeed. The bureau’s stance is an official interpretation, nothing more or less. It is not in some sense “correct,” but simply an official interpretation.

The bureau’s interpretation is nothing new. The Communist Party of China and the central government have propagated this stance for many years without much traction, and now the bureau is passing it on to the people of Hong Kong as the government’s “official” position. The bureau is thus aligning itself with the central government. We should recognise this move for what it is.

There is much in the statement with which any fair-minded person could agree. The British occupied Hong Kong by force and coerced the Qing court to sign various treaties that produced colonial Hong Kong.

The bureau quite rightly points out that in 1972 Chinese authorities demanded that Hong Kong and Macau be removed from a United Nations list of “colonial territories” that should be granted independence. Removing Hong Kong and Macau from this list did not mean that they ceased to be colonies, but that they ceased to be colonies that should be granted independence.

The bureau claims that to “use the word colony to describe the status of Hong Kong is inappropriate (不恰当, bu qiadang),” shying away from saying that it is incorrect. The bureau goes on to demand that students and the people of Hong Kong must have a “correct (正确, zhengque, proper) understanding of the historical facts.”

This implies that there is only one legitimate interpretation and gives the lie to the bureau’s appeal to “different perspectives.” Perhaps the bureau meant that students and the people of Hong Kong should be aware of the official interpretation. I agree.

What to make of the official view that Hong Kong was not a colony? This interpretation is grounded in a partial understanding of Hong Kong’s legal status before 1997. We need to understand that authorities make law to protect the interests of those in power. The law has a clear political dimension, which the bureau conveniently ignores.

British law, which applied to Hong Kong, recognised Hong Kong as a crown colony. The basis of Hong Kong’s status as a colony may be found in the Letters Patent and the Royal Instructions. The bureau is saying, “Well, your (British) law is not our law.” Okay.

Still from 1841 until 1997 Chinese official entities in Hong Kong recognised and obeyed British law in Hong Kong. That is Chinese state actors in Hong Kong recognised that they were bound by this law. They settled disputes in Hong Kong based on this law.

Thus, while the Chinese government may claim that the Sino-British treaties establishing Hong Kong as a colony had “no legal effect under international law,” Chinese and foreign actors in Hong Kong behaved as if these laws had legal effect. To deny this is to fail to recognise historical fact. Hong Kong was a colony and was recognized as such by Chinese and foreign state actors.

Moreover, colonial Hong Kong was the lived experience of the people of Hong Kong before 1997. The colonial laws of Hong Kong bound them, just as they bound Chinese state actors in Hong Kong. To say that Hong Kong was not a colony is to deny this experience. Such a denial does a great disservice to those of us trying to understand the behaviour of people living in Hong Kong.

Finally, remember that the “through train” brought most of Hong Kong’s colonial political, economic, and legal institutions into the city. They are with us today. Repeating the official narrative that Hong Kong was not a colony undermines the very real need, recognised by the Communist Party, to decolonise Hong Kong, including our civil service, education system, and system of public finance. Starting from the position that the people of Hong Kong were delusional, as the bureau’s stance seems to suggest, gets us nowhere.

The legacy of colonialism in Hong Kong – a system built on racism and coercion – must be confronted and not denied. The Education Bureau fails in its mission to educate when it implies that there is only one correct interpretation of Hong Kong’s colonial history, that is, the official version.

At its most basic, by relying the 1972 UN decision to remove Hong Kong from a list of colonies that should be granted independence, and taking that action out of context, the Education Bureau teaches us that historical facts do not matter, and toeing the line is the best way forward. This is very disappointing from educators.

So, to the Education Bureau: remember your mission is to educate. This means producing citizens capable of independent and critical appraisal of various perspectives, which the bureau claims to value, including its own official stance.

Source : Hong Kong Free Press

Chart: Canada Federal Debt by Prime Ministers

Source : Fraser Institute

Chart: China’s Rise to Economic Superpower

Source : Statista

Infographic: The 50 Biggest Data Breaches From 2004–2021

See large image . . . . . .

Source : Visual Capitalist

Worry About Stagflation, a Flashback to ’70s, Begins to Grow

Paul Wiseman wrote . . . . . . . . .

Stagflation. It was the dreaded “S word” of the 1970s.

For Americans of a certain age, it conjures memories of painfully long lines at gas stations, shuttered factories and President Gerald Ford’s much-ridiculed “Whip Inflation Now” buttons.

Stagflation is the bitterest of economic pills: High inflation mixes with a weak job market to cause a toxic brew that punishes consumers and befuddles economists.

For decades, most economists didn’t think such a nasty concoction was even possible. They’d long assumed that inflation would run high only when the economy was strong and unemployment low.

But an unhappy confluence of events has economists reaching back to the days of disco and the bleak high-inflation, high-unemployment economy of nearly a half century ago. Few think stagflation is in sight. But as a longer-term threat, it can no longer be dismissed.

Last week, Treasury Secretary Janet Yellen invoked the word in remarks to reporters:

“The economic outlook globally,” Yellen said, “is challenging and uncertain, and higher food and energy prices are having stagflationary effects, namely depressing output and spending and raising inflation all around the world.”

On Thursday, the government estimated that the economy shrank at a 1.5% annual rate from January through March. But the drop was due mostly to two factors that don’t reflect the economy’s underlying strength: A rising trade gap caused by Americans’ appetite for foreign products and a slowdown in the restocking of businesses inventories after a big holiday season buildup.

For now, economists broadly agree that the U.S. economy has enough oomph to avoid a recession. But the problems are piling up. Supply chain bottlenecks and disruptions from Russia’s war against Ukraine have sent consumer prices surging at their fastest pace in decades.

The Federal Reserve and other central banks, blindsided by raging inflation, are scrambling to catch up by aggressively raising interest rates. They hope to cool growth enough to tame inflation without causing a recession.

It’s a notoriously difficult task. The widespread fear, reflected in shrunken stock prices, is that the Fed will end up botching it and will clobber the economy without delivering a knockout blow to inflation.

This month, former Fed Chair Ben Bernanke told The New York Times that “inflation’s still too high but coming down. So there should be a period in the next year or two where growth is low, unemployment is at least up a little bit and inflation is still high.”

And then Bernanke summed up his thoughts: “You could call that stagflation.”


There’s no formal definition or specific statistical threshold.

Mark Zandi, chief economist at Moody’s Analytics, has his own rough guide: Stagflation arrives in the United States, he says, when the unemployment rate reaches at least 5% and consumer prices have surged 5% or more from a year earlier. The U.S. unemployment rate is now just 3.6%.

In the European Union, where joblessness typically runs higher, Zandi’s threshold is different: 9% unemployment and 4% year-over-year inflation, in his view, would combine to cause stagflation.

Until about 50 years ago, economists viewed stagflation as a near-impossibility. They hewed to something called the Phillips Curve, named for its creator, economist A.W.H. “Bill” Phillips (1914-1975) of New Zealand. This theory held that inflation and unemployment move in opposite directions.

It sounds like common sense: When the economy is weak and lots of people are out of work, businesses find it hard to raise prices. So inflation should stay low. Likewise, when the economy is hot enough for businesses to pass along big price hikes to their customers, unemployment should stay fairly low.

Somehow, reality hasn’t proved so straightforward. What can throw things off is a supply shock — say, a surge in the cost of raw materials that ignites inflation and leaves consumers with less money to spend to fuel the economy.

Which is exactly what happened in the 1970s.

Saudi Arabia and other oil-producing countries imposed an oil embargo on the United States and other countries that supported Israel in the 1973 Yom Kippur War. Oil prices jumped and stayed high. The cost of living grew more unaffordable for many. The economy reeled.

Enter stagflation. Each year from 1974 through 1982, inflation and unemployment in the United States both topped 5%. The combination of the two figures, which came to be called the “misery index,” peaked at a most miserable 20.6 in 1980.

Stagflation, and especially chronically high inflation, became a defining feature of the 1970s. Political figures struggled in vain to attack the problem. President Richard Nixon resorted, futilely, to wage and price controls. The Ford administration issued “Whip Inflation Now” buttons. The reaction was mainly scorn.


No. For now, the stagflation glass is only half-full.

There’s “flation” for sure: Consumer prices shot up 8.3% in April from a year earlier, just below a 41-year high set the previous month.

Consumer prices are surging largely because the economy rebounded with unexpected vigor from the brief but devastating pandemic recession. Factories, ports and freight yards have been overwhelmed trying to keep up with an unexpected jump in customer orders. The result has been delays, shortages and higher prices.

Critics also blame President Joe Biden’s $1.9 trillion stimulus plan of March 2021 for overheating an economy that was already hot. The Ukraine war made things worse by disrupting trade in energy and food and sending prices up.

But the “stag” has yet to arrive: Even though the government reported Thursday that economic output shrank from January through March, the nation’s job market has kept roaring.

Every month for the past year, employers have added a robust 400,000-plus jobs. At 3.6%, the unemployment rate is just a notch above 50-year lows. This week, the Fed reported that Americans are in solid financial health: Nearly eight in 10 adults said last fall that they were “doing okay or living comfortably” — the highest proportion since the Fed started asking the question in 2013.

Still, the risks are accumulating. And so are concerns about potential stagflation. Fed Chair Jerome Powell acknowledged this month that the central bank might not be able to achieve a soft landing and dodge a recession. He told American Public Media’s “Marketplace” that he worries about “factors that we don’t control” — the Ukraine war, a slowdown in China, the lingering pandemic.

At the same time, inflation has been eroding Americans’ purchasing power: Prices have risen faster than hourly pay for 13 straight months. And the nation’s savings rate, which soared in 2020 and 2021 as Americans banked government relief checks, has fallen below pre-pandemic levels.

Europe is even more vulnerable to stagflation. Energy prices there have skyrocketed since Russia’s invasion of Ukraine. Unemployment in the 27 EU countries is already 6.2%.


For four decades, the United States virtually banished inflation. In the early 1980s, Fed Chair Paul Volcker had jacked up interest rates so high to fight inflation — 30-year mortgage rates approached a dizzying 19% in 1981 — that he caused back-to-back recessions in 1980 and 1981-82. Yet Volcker achieved his goal: He managed to rid the economy of high inflation. And it stayed away.

“The Fed has worked hard since the stagflation of the late 1970s and early 1980s,” Zandi said, “to keep inflation and inflation expectations closer to its target,” which is now around 2%.

Other factors, including the rise of low-cost manufacturing in China and other developing countries, kept a tight lid on prices that consumers and businesses pay.

The United States has endured periods of high unemployment — it reached 10% after the 2007-2009 Great Recession and 14.7% after COVID-19 erupted of 2020. Yet until last year, inflation had remained at bay. In fact, not since 1990 has the nation faced a year of Zandi’s 5%-inflation, 5%-unemployment stagflation standard.

Source : AP

Chart: Historical % Fall of NASDAQ Composite Index from Previous Market Peak

Source : Chartr

Chart: Historical Asset Bubbles

See large image . . . . . .

Source : Bank of America

China COVID Lockdowns Revive the Ghosts of a Planned Economy

Li Yuan wrote . . . . . . . . .

Yang Wenhui should be a proud example of China’s rise from economic rubble to global powerhouse.

Growing up poor, he ate so much cabbage that he did not touch it again for many years. He worked as a farmer and a construction worker before joining the country’s nascent logistics industry. In 2003, he started his own freight logistics company, striking gold as online shopping took off in the 2010s and products moved swiftly between provinces.

Then the omicron variant started spreading in China. In the government’s zealous pursuit of its “zero-COVID” policy, dozens of cities along the 1,300 miles of highway between the capital, Beijing, and the southern province of Guangdong, his main freight route, imposed travel restrictions and lockdowns. Many truckers were grounded. Cargo prices rose 20% in a matter of weeks.

“I’ve been in the logistics business for 28 years,” Yang, 47, said. “But I’ve never seen a mess like this. There were numerous emergencies to deal with.”

He estimates that he lost tens of thousands of dollars in March.

China’s economy is a giant, sophisticated machine that requires numerous parts to work together. Behind its 1.4 billion consumers are 150 million registered businesses that provide jobs, food and everything that keeps the machine humming.

Also read |Explained: Why is China seeing a spike in Covid-19 cases, and should India worry?
Now, in the name of pandemic control, the Chinese government is meddling with the economy in ways that the country has not seen for decades, wreaking havoc on business.

Businesspeople worry that the country is going back to a planned economy, and the great COVID disruptions could last until after a Communist Party congress late this year when China’s top leader, Xi Jinping, is expected to secure a third term. A surge in cases in Beijing is amplifying global fears as well, prompting a sell-off in stocks on concerns that China’s economy could take another hit.

In the past two years, many governments around the world have sought a balance between controlling the pandemic and keeping businesses open. China was largely successful until recently when omicron, a milder, if more infectious, variant, caused a serious outbreak. As much of the world is opening up, the country is doubling down on its zero-COVID policy, making low death and infection rates central to its legitimacy.

Since March, China has reported about half a million COVID infections and 48 deaths through April 22.

Around 344 million people, or a quarter of the country’s population, are under some kind of lockdown, according to investment bank Nomura. The lockdowns have left China’s biggest city, Shanghai, a metropolis of 25 million people, a ghost town; farmers in the northeastern granary cooped up in the spring planting season; and many factories, shops and restaurants across the country suspending their operations.

The stringent measures are exacting a heavy toll on the economy. Nationwide consumption fell 3.5% in March, while spending at restaurants plummeted 16%, according to official data.

“This is not only making it impossible for many private businesses to survive, but also accelerating outbound immigration and quickly dampening willingness to invest,” said Zhiwu Chen, an economist at the University of Hong Kong. “Once people lose confidence in the country’s future, it will be extremely difficult for the economy to recover from the zero-COVID policy’s impact.”

Business owners and managers are complaining that the current disruptions are worse and more widespread than those of early 2020 when logistics, commerce and industrial production in much of the country quickly returned to normal. Back then, the government’s digital surveillance systems to limit the movements of vehicles and people were less extensive.

The business community is waiting nervously to see if the government will apply the Shanghai lockdown model to other cities. The approach has a strong element of a planned economy, in which the government controls business activities, rather than letting the market regulate supply and demand.

During the outbreak, the Shanghai government upended the commercial systems and tried to provide for 25 million people on its own. The results are familiar to Chinese of a certain age: scarcity of supplies and mushrooming of black markets.

Because of COVID restrictions, commercial trucks have a hard time delivering food and household goods to Shanghai. Inside the city, only vehicles with passes are allowed on the road.

On the black market, some operators are willing to pay $2,000 for a day pass. The cost is then priced into the groceries they sell to the residents.

Some neighborhood committees allow only government-organized grocery distributions; others do not allow their residents to purchase diapers, baby formula and toilet paper because they are not considered necessities. Elsewhere, fruit, beer and coffee are considered frivolous items.

Starting in the 1980s, China moved away from its planned economy because it left everyone poor. It did not work in the former Soviet Union nor is it working in North Korea.

John Ji, a real estate developer in Nanjing of Jiangsu province, is anxiously watching the lockdowns in Shanghai and other cities. He believes many people will lose their jobs and have difficulty paying mortgages. When nobody can afford housing, he asked, who will buy his apartments?

Ji also grew up poor. Before he turned 10, his staple was sweet potatoes. He ate meat only a couple of times a year.

“I’m worried whether we’re going back to a planned economy,” he told me. “If the economy keeps slumping, we might become poor again.”

Source : The New York Times

Shanghai Lockdown Brings Back Memories of China’s Past

Wu Peiyue wrote . . . . . . . . .

Since Shanghai got locked down, the local government has taken on the responsibility of uniformly distributing food and necessities. Many people online say it feels like a return to the planned economy era.

So Sixth Tone asked a Shanghai resident who remembers the planned economy.

Born in 1965, Hua, who only gave his surname for privacy reasons, has witnessed China’s transition from a planned economy to an open market.

In 1989, Hua quit a factory job in Shanghai and stepped into the business world. In the 1990s, Hua sold various things in Wuhan, such as engraving machines and jeans, and later worked as a technology transfer agent for a variety of small machinery such as cigarette lighters. He also acted as a salesperson for imported factory machines in central China.

Hua achieved financial freedom in 2001, and became interested in solar-heating technology. He filed several patents. In 2019, Hua became interested in sociology after reading Yuval Noah Harari’s “Sapiens: A Brief History of Humankind.” Recently, alone in his apartment, Hua told Sixth Tone he’s reading “Making Things Work: Solving Complex Problems in a Complex World” by Yaneer Bar-Yam.

This interview has been edited for brevity and clarity.

Pork and rice

In our neighborhood WeChat group, one of the residents complained that the community had only given out pork, and the meat is too fatty.

I felt just the opposite. Pork has always had a strong appeal to me. It was always short during my childhood. When I was growing up, meat was a rare commodity and had to be purchased with a ration ticket. At that time, fatty meat was worth more than lean meat, because we could also render it to make cooking oil, which was also scarce back then.

These days, people who run out of oil at home also have to use the method of rendering lard. It feels like going back in time.

What we are experiencing now definitely cannot be called a “planned” economy… But with scarce supplies and limited variety, our relationship with food has changed. It’s gone from eating whatever comes to mind, to requiring some planning ahead of time.

When I was growing up, my parents were the ones who planned what the family ate. I don’t have many memories of how they planned the food. The time I started to plan for myself was when I went to college in the north. Each student was given a certain amount of ration tickets every month, and 40% of them were for coarse food — cornmeal and millet. As a southerner, I hate coarse food, but if I didn’t eat them, I’d starve. So I forced myself to eat the coarse food by cooking it as porridge for breakfast, so I didn’t have to deal with it the rest of the day.

Now I am doing something similar. I don’t like the noodles our community is giving us, so I eat them for lunch, rather than for dinner.


I grew up in a shipyard’s work unit, where everyone worked for the same factory. At that time, the factory issued ration tickets to families every month based on how many people they had, and some families might exchange some extra rice with their neighbors for eggs.

It was the natural thing to do, to swap goods with each other in an “acquaintance society.” Families were close-knit and everyone knew each other intimately.

Now, I live in a high-rise apartment complex built in 1996. I don’t know any of my neighbors. And I think modern buildings don’t foster an intimate atmosphere.

Last week, I took a whole day to make tofu from soybeans. It was a huge batch, more than I can eat alone. I posted a picture on WeChat, and a friend suggested that I should give some to my neighbors.

I did give it some thought. But I’m feeling a bit sensitive, because my recent attempts to make friends with my neighbor failed. I have a habit of playing badminton. Last week I saw two young people downstairs playing, but not very skillfully. I volunteered to join and helped them to play better. The next day, I brought an outdoor shuttlecock, meaning to give it to them. However, when I stood there, they acted as if they didn’t know me. And the previous time, when the game was over, they neither suggested that we could be WeChat friends, nor took the initiative to ask me to play with them again.

I gave up on giving tofu to my neighbors. I didn’t know which neighbor I should give it to. “If I asked in the WeChat group, and a lot of people wanted it, it would be a very embarrassing decision to make,” I told myself. I just put it all in the fridge.

Group buying is the only group activity I participate in. I force myself to participate, because the food supplies given by the community are totally insufficient. But community group buying only works for those who actively follow the group chat, so if you miss the message, you miss the group buy.

One elderly person in our community called the head of the neighborhood committee, and said he was about to run out of food. The leader said they would report upwards, and also suggested he call 12345.

In the acquaintance society of the past, people would help the old man during the group purchase, not just throw the responsibility of taking care of the old man to the neighborhood committee.

Reform and opening

I lived my young adulthood during the transition from the planned economy to the opening of the market.

Reform and opening up began to take shape in Shanghai in the late 80s. After I graduated from college, I was assigned to work at the Shanghai Machine Tool Factory in 1986. I soon felt that the atmosphere was changing. People around me were getting out of the system and going all over the country to look for business opportunities. Before, it was a crime — “speculation” — to take something from a place where it was abundant to a place where there was scarcity.

In 1989, I took a leave of absence from my job and went to Shenzhen to experience the business atmosphere, and then started to go around the country, trading sand, cement, and rebar, and later trying to sell computers, stereos, and printers in Shanghai.

At that time, each city had its own food specialty, and these things could only be bought when you went to the local area. Each city had its own brand of milk. Beer too. Now, you can buy any local food brand you want online.

During this lockdown, all of a sudden there is less choice of food brands. It does seem like a return to the old days. Shanghai’s local food brands are easier to find in group buying groups. Of course, there are also some food brands that we’ve never seen before. I think these brands are hard to notice in the free market by high-spending Shanghai citizens, with competition from all over the country, and even from imported brands.

I’ve heard that now it’s all companies with good relations with the Shanghai government that are on the guaranteed supply list, and big private companies like JD.com are not on the list, so it leads to very poor transportation.

If we were still in the era of the planned economy, this might not feel so jarring. At that time all the enterprises were all state-owned and it would all be down to the government to coordinate.

But then again, the recent phenomenon is actually quite understandable. China’s economy was slowly opening up into a free market, but it has never been entirely free. Any regional business that wants to enter the market in another area will encounter top-down resistance. Like Wahaha — after it captured almost all of the national market with the strategy of “encircling the city with the countryside,” it still took a long time to enter Shanghai.

In China, the free market has always been carried out in a macro-controlled way by the government. So I think we shouldn’t dichotomize and say that a free economy is better suited to solve the current situation or a planned economy. Rather, we should reorganize the relationship between these two methods and use them in an optimal combination.

Through this time, I’ve realized that lots of us, including myself, our thinking has been stuck in the past, in the ways of industrial mass production — a much more standardized system.

Now it’s the internet era. The complex logistics within the city are built with a lot of reliance on algorithms to distribute things individually. Now this system is not working, so we’re going back to top-down distribution, and supply is inadequate. Now the self-initiated community group buying is supplementing this.

There needs to be a new management solution for this state of abundance. It’s a state of rapid change for everyone. This lockdown of the city is a good test. It forces us to ask how to manage things with a complex system.

We shouldn’t do nothing ourselves and just complain about being managed in a one-size-fits-all manner. We, the citizens and community leaders, should take the initiative to discuss with people close to us and come up with a solution that works for us, but also meets the “dynamic zero-COVID” requirements from the government.

Source : Sixth Tone

Video: The Rise and Fall of Shanghai’s Cabaret Culture

In the 1920s and ’30s, Shanghai was known as a city of sin: a “Paris of the East” famous for its rich nightlife.

The city had hundreds of cabaret clubs, where gang leaders clinked glasses with high-level politicians. From here, cabaret culture spread across China and beyond.

Today, Shanghai’s cabaret scene is remembered as a colonial import, but the story is more complicated than that. The art form was also embraced by China’s “May Fourth Generation” — a revolutionary youth movement for whom nationalism and sexual liberation went hand in hand.

Over time, cabaret became a part of Shanghai’s local identity, and the city’s scene gained global recognition. “Rose, Rose, I Love You” — one of the best-known cabaret songs of the era, by Shanghai pop star Yao Lee — even made it onto the U.S.’s Billboard music charts in 1951, when it was re-recorded by the American singer Frankie Laine.

Watch video at Sixth Tone (8:54 minutes) . . . .