The Next Five Years: Mission Impossible IV

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By now, everyone will know Carrie Lam took the day in convincing fashion – well, compared to CY Leung. Unfortunately, the vote count of 777 votes will provide even richer ground for gently obscene mirth over the next five years.

Mea culpa, my purported theory about Beijing playing this for a JT win, while many agreed was sound logic and smart politics that would have benefited Hong Kong, did not stand against the fly I identified in the ointment: Smart and good is beat out by the dictator’s overriding need not only control, but be seen to control.

There was no defection from the pro-establishment ranks. We spoke to pro-est major domo Ip Kwok-him and he was confident of maintaining discipline. So was Dennis Kwok (Legal, FC) about the pan-dems, and both seemed to be right. Johnny Lau Yiu-sui, former HT columnist and premiere China analyst, insisted, pre-vote that the Chinese government would brook no dissent – and he was right.

So what should those influenced by policy direction look for over the next few years? In Harbour Times Forums, we’ll be looking at financial regulations on Thursday morning and a few spots remain open for members in that meeting.

For other broad categories, some thoughts:

Economic policy and regulatory environment – There will be no revolution

Carrie Lam will not be upsetting any apple carts, whether of developers or other entrenched business interests. Neither will she mess with Hong Kong’s underlying economic liberty (compared to other jurisdictions). There will be no floodgate opened on either importing labour nor kowtowing to unions (i.e. leaping to implement standard working hours). CY Leung’s 20,000 a year housing unit target will remain, although falling short of it will obliquely at first, and then more directly later, be blamed on the previous administration while still striving to meet it. Incremental, negotiated change in policy will continue to be the order of the day.

The difference may be in execution where Carrie Lam’s better control of the civil service and understanding of government working may lead to the clearing of roadblocks. Intentional bureaucratic slowdowns will also be less common as civil servants will know that Ms Lam knows all the tricks and will see who is up to what and move strongly against those who thwart her will. Which comes to…

Relations with the civil service: The devil you know – and who knows you

This will be a bright spot in the new administration. The civil servants know it is one of theirs in the driver’s seat. It may not be the softer John Tsang, but it is someone who knows and appreciates the civil service. While some may have felt Ms Lam’s ‘suffer no fools’ administrative style, at least she ‘gets’ the life of a bureaucrat. From an outsider’s perspective, it means that the gap between policy and execution may shrink, but bodies providing oversight will need to be extra vigilant to ensure an army of ‘Humphreys’ don’t seize the castle.

Frankly, I’m not sure Hong Kong society and our appointees are up to keeping a close eye on the bureaucrats.

However, one of the main complaints about the bureaucracy in recent years has been their timidity in engaging with the public, business leaders and civil society. With one of their own in charge, perhaps they will be more confident – and better resourced – to come out of their shell, get their heads above water (vis a vis workload), and better engage with those who need to impact policy.

Social Policy, Human Rights, Relations with pan-dems – A hot mess

These are related, so hang on.

This is not going to happen. I’m not one for trashing other media, but a lead story about mainland scholars saying Beijing will grant more autonomy to Hong Kong, citing scholars on the mainland is an insult to intelligent readers and another sign that the SCMP is delivering on its new mission of being a laughable mainland mouthpiece. Moderating this leading story, this piece from Emily Lau will be buried deeper in the paper and a sidebar on the website.

Johnny Lau (aforementioned) is not confident on human rights and freedoms, and tells me “Beijing will grab Hong Kong as tight as possible.” So booksellers and mainland tycoons alike should book their tix for Taiwan and Canada ASAP or put aside private time to ‘assist in investigations’.

Expect more conflict in the streets and in LegCo. The speed at which projects and laws move through LegCo should be faster, on balance still, than under CY Leung. This is because as they government continues to drive out popularly elected representatives on legal technicalities, the pro-establishment forces will strengthen their ability to cut off debate. Also, the bureaucracy will move faster to support legislative drafting and execution (see above).

But the futility of pro-democratic and localist lawmakers will drive them to the street and strengthen their complaints and justification for radical street action.

On social welfare policy, look for DAB and FTU priorities to be rewarded and the pan-dems to be sidelined. As Fernando Cheung (Labour Party, GC -NT East) told me yesterday (video), relations couldn’t get worse.

Harmonious society – Fugeddaboutit

Ladies and gentlemen, please fasten your seatbelts as we are entering a region of extreme turbulence.

Sigh.

The business community took their cues from Beijing and fell in behind Carrie Lam. Many genuinely like and appreciate her managerial nous, no-nonsense approach and willingness to do her homework on any issue she tackles. She would make a wonderful Chief Operating Officer, the sort any CEO would kill to have. However, sales, marketing, cheerleading and inspiring, the realm of a great CEO, may be beyond her.

Her image as Beijing’s woman means she starts off with a deep trust deficit that may be impossible to recover from. Antics by no less than shadowy mainland security apparatus, and the Liaison Office, will no doubt undermine her efforts. If she gets one step forward, China connected political oafs will set her five steps back. A Global Times editorial, a body-snatching, or an insensitive response to a genuine Hong Kong public concern will always undo any good she might do.

Johnny Lau, again, sees Hong Kongers only preserving any institutions connected to their values by actively fighting against Beijing’s impulse to control.

One particular concern I have is that the broader Hong Kong society will deepen its distrust of business in general, given that sector’s whole-hearted support of Ms Lam both in nominations and, as the numbers would suggest, voting. That would be a sad thing if it resulted in a further erosion of support for Hong Kong’s economic freedom. Such distrust usually increases the regulatory regime, which is then captured by the biggest firms, reducing competition and stifling innovation. That cannot be good for Hong Kong.

In summary…Mission Impossible IV

The business community and civil service may work more closely to execute on smarter policy over the next five years with a strong interlocutor in the CE seat. The downside is that the public’s alienation will likely increase with no trust in a champion to protect their interests against an oppressive central government.

Quiet brain drain will deplete our civic resources while agitation in the streets will take up the headlines and produce angst and exasperation among those dug into Hong Kong. Localists will continue to gather strength and more moderate democrats will be sidelined.

The question of whether a breaking point is reached in the next five years is unclear. Another five of CY would have been disastrous. Ms Lam has a chance of keeping most balls in the air, addressing some economic concerns – but political grievances will be very, very tough to address effectively.

But she’s a tough, competent woman. The perennial optimist in me thinks that maybe there is hope after all.

(Printer – R&R Publishing, Suite 705, 7/F, Cheong K. Building, 84-86 Des Voeux Road Central, HK)