No matter what lies ahead for Hong Kong, we should admire its rise to prosperity through liberal reforms.
Marian L. Tupy —
I shall always regret not visiting Hong Kong while it was still under British control or while the city remained the “Hong Kong Special Administrative Region of the People’s Republic of China.” For reasons I will get into below, I feel a special affection for the city, and will mourn the loss of its political autonomy and, potentially, the end of its economic prosperity.
For classical liberals, Hong Kong had been a beacon of hope for half a century. Peter the Great is said to have built St Petersburg to be “Russia’s window to the west.” Hong Kong was supposed to be liberalism’s window to the future. The city’s fabled wealth was built on four pillars of classical liberalism: limited government, rule of law, free trade, and fiscal probity. And, it worked! We hoped that the rest of the world would follow a similar path.
When Britain obtained the territory following the First Opium War (1839 – 1842), British Foreign Secretary Lord Palmerston denounced the acquisition as a “barren rock with nary a house upon it” that would never “be a mart for trade.” He was right—at least for the first 100 years.
In 1941, Martha Gellhorn, an American war correspondent, accompanied her new husband, Ernest Hemingway, on a trip to a war-torn Hong Kong. The city was on the front line, with the imperialist Japanese slowly gaining ground against Chiang Kai-shek’s nationalists. Landing by plane in Hong Kong, she penned the following impressions of a starving city:
The streets were full of pavement sleepers at night. The brothels were small square wood cubicles, lining a narrow passage; $2 a night per man per girl… These people were the real Hong Kong and this was the most cruel poverty, worse than any I had seen before. Worse still because of an air of eternity; life had always been like this, always would be. The sheer numbers, the density of bodies, horrified me. There was no space to breathe, these crushed millions were stifling each other… When finally I visited a dank ill-lit basement factory where small children carved ivory balls within balls, a favorite tourist trinket, I could not bear to see any more. I had a mild fit of hysterics. ‘They look about ten years old,’ I shouted at the UC [Unwilling Companion = Ernest Hemingway]. ‘It takes three month to make one of those damned things, I think it’s eight balls within balls. They’ll be blind before they’re twenty. And that little girl with her tortoise. We’re all living on slave labor! The people are half starved! I want to get out, I can’t stand this place!’ … From agonizing over the lot of my Chinese fellow men, I fell into a state of hysterical disgust with hardly a pause. ‘Why do they all have to spit so much?’ I cried. ‘You can’t put your foot down without stepping on a big slimy glob! And everything stinks of sweat and good old night-soil!’ The answer of course could be that spitting was due to endemic tuberculosis, and as for the stink, I had seen where and how the people lived.
And then, things changed. By the time of the Hong Kong hand-over to the Chinese in 1997, the average Hongkonger was 12 percent richer than a typical Briton. Last year, the people of Hong Kong were, on average, 46 percent richer than the British. The poverty that Gellhorn described was not “eternal” after all. But, Hong Kong’s emergence from destitution to one of the world’s richest territories was no miracle. The city became a success due to a thoughtful application of liberal principles.
I first heard about Hong Kong’s success as a post-graduate in St Andrews. (My undergraduate education in Johannesburg was more conventional, focusing on the evils of global capitalism rather than the prosperity it bestowed upon those who partook in it.) By the early 2000s, Internet was good enough to watch online videos, including Milton Friedman’s timeless “Free to Choose” series. In one of the episodes, Friedman travelled to Hong Kong to admire its rise from poverty. He did so in 1980 and could not have known that the city’s best days lay ahead.
Friedman noted that Hong Kong’s success did not happen by chance and credited a British civil servant, Sir John Cowperthwaite, with instituting a laissez-faire system of governance while the latter was the colony’s financial secretary (1961 – 1971). Since then, I learned that Sir John was not alone. His predecessors as financial secretaries, Geoffrey Follows and Arthur Grenfell Clarke, as well as Sir John’s hand-picked successor, Philip Haddon-Cave shared a similar (if less principled) commitment to laissez-faire.
There was a reason, I suspect, why Friedman focused on Cowperthwaite’s role. That reason was the damnable decade of the 1960s. It was one thing to promote and defend limited government in the liberal 1860s or the post-stagflation 1980s. The 1960s were an altogether different kettle of fish. Britain, at that time, had a socialist government, the Soviets sent a man to space, and Britain’s African possessions were opting for independence and communism. Meanwhile, Hong Kong, with its low taxation and regulation, competitive enterprise and free trade, and modest income redistribution and budget surpluses, was an anomaly.
Cowperthwaite knew that—or so he told me when I visited him at his home that was located, to my astonishment, three doors down from my university dorm. Having retired to St Andrews, the location of his alma mater, after he left the civil service, Cowperthwaite led a self-facing life. Having graciously agreed to see me, he expressed his frustration with others’ glib (though amusing) comments that he helped to usher an era of prosperity to Hong Kong by “doing nothing.” In reality, he said, his hands were full fending off incessant attempts of the British government to import socialism to the colony. By standing firm, he bought Hong Kong precious time. By the early 1970s, the British soured on socialism. Likewise, the USSR was revealing the limits of central planning. Most importantly, the economic success of Hong Kong was beyond question. And so, laissez-faire remained.
I do not know how Hong Kong’s success impacted Margaret Thatcher’s reform agenda in Britain, though it is likely that the people who advised the future prime minister must have been aware of the city’s experiment with liberalism. The Red Chinese certainly knew what was going on. On one side of the border with the colony, gleaming towers of commerce and untold riches. On the other, destitution and firing squads.
Paradoxically, it was Lady Thatcher who, bowing to reality, acceded to the handover of the colony to the communist despots in 1997—with the proviso that Hong Kong would remain autonomous until 2047. Perhaps she thought that time would transform China into a wealthy and free country. If so, she was only half right. Today, it is the newly enriched and confident mainlanders who are strangling the city’s freedom and vitality—27 years ahead of schedule.
In the short to medium term, the clouds over the city are very dark. In the long run, who knows? Palmerston could not have predicted Hong Kong’s rise. Who are we to predict its destruction? Nothing is permanent—not even the tyrants in Peking!
ARC Panel with Marian Tupy: Is Western Energy Policy Causing Economic Self-Harm?
This conversation, with experts Marian Tupy, Magatte Wade, Chris Wright, and Robert Bryce, lays out why energy equals GDP, and how outsourcing energy consumption to other nations is not a green policy.
FDA Authorizes AI-Driven Test to Predict Sepsis in Hospitals
“Bobby Reddy Jr. roamed a hospital as he built his start-up, observing how patient care began with a diagnosis and followed a set protocol. The electrical engineer thought he knew a better way: an artificial intelligence tool that would individualize treatment.
Now, the Food and Drug Administration has greenlighted such a test developed by Reddy’s company, Chicago-based Prenosis, to predict the risk of sepsis — a complex condition that contributes to at least 350,000 deaths a year in the United States. It is the first algorithmic, AI-driven diagnostic tool for sepsis to receive the FDA’s go-ahead.”
“Global Fishing Watch was co-founded by Google, marine conservation body Oceana, and environmental group SkyTruth. The latter studies satellite images to spot environmental damage.
To try to better monitor and quantify the problem of overfishing, Global Fishing Watch is now using increasingly sophisticated AI software, and satellite imagery, to globally map the movements of more than 65,000 commercial fishing vessels, both those with – and without – AIS.
The AI analyses millions of gigabytes of satellite imagery to detect vessels and offshore infrastructure. It then looks at publicly accessible data from ships’ AIS signals, and combines this with radar and optical imagery to identify vessels that fail to broadcast their positions.”
Before smartphones, beepers were in the crosshairs of parents, schools and lawmakers.
Louis Anslow —
30 years before parents and lawmakers sought to save youth from smartphones via age limits and bans in schools, a similar conversation took place about a pre-cursor to the cellphone: pagers.
Through the 1980s pagers became increasingly popular with teens, and also: drug dealers. This fact would eventually drag the gadget into the existing moral panic about adolescent drug use of the era.
The pager panic began with a 1988 Washington Postreport on the gadgets prevalence in the drug trade, quoting DEA and law enforcement officials. The piece was syndicated throughout the US under headlines like “Beepers flourish in drug business,”“Beepers Speed Drug Connections” and “Drug beepers: Paging devices popular with cocaine dealers.”
The spread of the story stoked concerns that beepers in the hands of youths weren’t just a distraction – a common complaint from teachers – but also a direct line to drug dealers. One school district official told The New York Times: “How can we expect students to ‘just say no to drugs’ when we allow them to wear the most dominant symbol of the drug trade on their belts.”
How can we expect students to ‘just say no to drugs’ when we allow them to wear the most dominant symbol of the drug trade on their belts
In response schools, towns, states and even the Senate would pass rules against beepers. New Jersey prohibited beepers for under-18s entirely, possession could result in a 6-month jail-term – a law proposed by ex-policeman and Senator Ronald L. Rice.
A city ordinance in Michigan mandated 3-month jail terms for children caught in possession of one within school grounds. Chicago passed a ban that its Public Schools Security chief said would also reduce prostitution:
We’ve got girls 11 years old. They get a call and they’re out of school to turn a trick.
George Sims, Chicago Public Schools Security Chief , Associated Press
Other states proposed community service, fines and 1-year drivers license bans as punishment. Thousands of of young people were victims of these heavy handed prohibitions – some of which made headlines:
Some schools regularly referred students found with pagers to police, one 16-year-old – Stephanie Redfern – faced a disorderly persons charge. A 13-year-old was handcuffed. Chicago was particularly aggressive in its enforcement: over 30 children were arrested and suspended for ‘beeper violations’ in one police sweep at a school – many parents couldn’t locate their kids for more than 6-hours. This was just the start:
According to Police Lt. Randolph Barton – head of the Chicago public school patrol unit at the time – by April 1994 there had been 700 beeper arrests in Chicago schools, with the prior school year seeing 1000. Some still felt these numbers were too low:
Right now I don’t think enough people are being arrested for wearing or bringing beepers into Chicago schools.
Ald. Michael Wojcik (35th)
In 1996 a 5-year-old in New Jersey was suspended for taking a beeper on a school trip, outrage ensured – catching the attention of Howard Stern, leading to calls for the laws to be amended or repealed.
Even young adults didn’t escape the beeper prohibition: 18-year-old Anthony Beachum feared a jail term after trying to sell a beeper to a student on school grounds. State prosecutors sought a criminal conviction for Beachum – that would have barred him from his hopes of joining the military. The judge settled for probation and 10 hours of community service.
Hampton Universityrequired students register beepers with campus police, even though there was no evidence of them increasing drug access. VP of student affairs at the time would admit as much:
There is not a single case where I can make a connection between beepers and drugs.
Hampton University,VP of Student Affairs
Big Beeper Fights Back
The beeper backlash was a BIG problem for Motorola who had 80% of the pager market at the time. The company had a hit on its hands – that was introducing the brand to a whole new generation – so in 1994 it fought back, partly by rallying youth. A move reminiscent of TikTok’s recent lobbying tactics.
Motorola enlisted children of its employees to help design pro-beeper campaigns, emphasizing the importance of pagers as legitimate communication devices for the young. “Who better to help plan for the battle than teens themselves” one report on the efforts would say. At a week long event, one attendee came up with the slogan “Pages for All Ages.”
The company ran television ads promoting pagers as a tool for child parent communication and in 1996, partnered with PepsiCo to offer 500,000 pagers to youths at a low price.
The promotion angered lawmakers – like State Senator Ronald Rice – who’d been a leading player in the war on beepers. Around this time moves to over-turn bans emerged, by other lawmakers calling them outdated – partly fuelled by the suspension of a 5-year-old alluded to earlier. New Jersey would amend the law in 1996, but not repeal it.
Three decades later, the New Jersey law was still on the books. The original sponsor of the bill – Senator Ronald Rice – sought to repeal it in 2017 saying “Fast forward almost three decades and it’s no longer an issue.”
There is little evidence it ever was an issue, in-fact – the subsequent rise of cellphones in schools coincided with a massive reduction in youth drug taking, while causation has been suggested by some – it certainly serves as stronger evidence against the idea of mobile messaging increasing drug access.
Senator Ronald Rice passed away in 2023 – the New Jersey Pager ban still in place – months later The Washington Post editorial board would call on schools to ban cellphones entirely – part of a new moral panic about kids and digital devices, many of whose parents were once prohibited from bringing pagers to school.
Nod to Ernie Smith of Tedium.co the only other person to cover the beeper bans, a piece that helped highlight a few fun examples included in this piece.
This article was published at Pessimists Archive on 4/10/2024.
