“China: See No Fortune, Hear No Fortune”

On the subject of wealth inequality, another great post from Evan Osnos:

That is not a surprise, of course, but the report’s details are notable: private wealth in Asia grew at more than double the global average last year, led by China, which saw private fortunes grow twenty-nine per cent. In the next four years, China alone will account for a fifth of all the growth in Asian private wealth.

Where is the money going? Places that are easier to spot than a billboard: sales of Ferraris in China grew by nearly half last year; sales of Lamborghinis in China tripled. Who is driving them? A young, self-made leisure class, according to a survey by Hurun, which tracks the fortunes of China’s rich. The average Chinese millionaire is thirty-nine years old—a full fifteen years younger than the global average—and, among their favorite activities, golf is their preferred sport. (The Chinese millionaires’ average handicap is twenty-six; they must be paying for lessons, because when they cross the $100-million threshold, the average handicap drops to twenty-four, Hurun says.) It’s not all going to a good time. Four out of five millionaires say they are considering sending their children abroad for education, with the U.S. as the preferred destination. (Same goes for Party elites; I can’t remember the last time I met a senior Party official whose child is not at Taft or Yale or the like.)

What’s the solution? Definitely not a return to China’s days of patently false egalitarianism. But banning the sight of a gross misallocation of resources rather than attacking the roots of it—by, say, reforming regressive indirect taxation, and putting a levy on capital gains and inheritance—is a political self-delusion as disconcerting as when Chinese officials used to show each other bogus bumper harvests.

Exactly right.

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Filed under China, inequality

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