The Impact of Social Inequality on Hong Kong's Economy
Disclaimer: I am not an economist, but having lived in Hong Kong for a long time, I have observed several patterns regarding social inequality and its impact on the economy. Please bear with my rant.
According to a government report published in November 2017, approximately 20% of Hong Kong's residents are below the poverty line. The government often cites a rapidly aging population as the reason for this issue, asserting that there is little they can do to address it. However, keeping such a high number of residents in poverty has significant consequences for the economy.
Effect of Poverty on GDP and Economic Growth
A substantial portion of the population, unable to drive the economy in a significant way beyond providing cheap manual labor, severely hampers economic growth. Low purchasing power, minimal or obsolete skills, and limited opportunities for improvement all contribute to this issue. A small fraction might excel academically, allowing them to enter the middle class, but the majority of the population does not continue their education beyond secondary school.
Government's Response and Policies
Instead of providing free education and other allowances to alleviate poverty, the government chooses to offer low-cost, substandard housing. This approach keeps residents in cheaper areas, often out of sight, much like how some residents rely on cheap labor for their own personal needs.
Is the Choice Based on Cost or Convenience?
The latest budget surplus of HKD 138 billion demonstrates that the government could afford to provide high-standard education for both children and adults wishing to gain new skills. However, why opt for substandard housing over education? Some might argue that the thought of change is too frightening for those with vested interests in the current status quo. But is this fear driven by malice or sheer stupidity?
Lack of Vision and Future Prospects
Imagine a world where workers are no longer considered too expensive because society has advanced beyond such a low level of civility and has invested in educating its population. In such a world, children could receive high-quality, free education up to and including university or pre-vocational levels. This would open up vast possibilities for new startups and industries driven by a well-educated populace.
While many Western societies already practice this, Hong Kong still operates under medieval principles in terms of education and support for its workforce. This rigid system perpetuates social inequality and hinders the economic growth and innovation that could come from a more educated and diverse population.
In conclusion, the government's failure to address social inequality has severe economic repercussions. The time has come for policy changes and rethinking to create a more equitable and prosperous Hong Kong.