Let them build whatever they want

I see that Simon Patkin has graduated from writing letters to the SCMP, and is now a contributor. Still the same old nonsense (subscription required), of course.

He is arguing in favour of the preservation of "property rights" in the context of the (now abandoned) redevelopment of Hunghom Peninsula and reconstruction of Central Police Station.  I haven't been following the saga of the Central Police Station, but I have to agree with Simon that the power of property developers and their impact on Hong Kong is certainly coming under closer scrutiny. Simon is concerned that environmentalists and community activists are influencing the decisions made by property developers:

The rational alternative to the heritage and other conservation policies is to remember that property rights are exactly that - rights. Just as one person has no right to place masking tape over the mouth of another just because they disagree with his or her views, non-owners have no right to expect the government to threaten force against the legitimate owner to stop him or her improving the property.

What Simon seems to have forgotten is that the basis of the capitalist system is the balance between the rights of capitalists to make money and the rights of everyone else to enjoy such things as security, health, and a decent environment. The way this plays out varies from one country to another, but there is always an element of government regulation coupled with an awareness by large companies that they have to take heed of public opinion and give something back to the community. It's fairly clear that in the case of Hunghom Peninsula, the developers backed away from their original plan because it was so widely criticized. Simon apparently feels that sets a bad precedent, whereas I view it as a welcome sign that large companies are taking note of public opinion. I wonder if he felt equally upset that the government bowed to public opinion and withdrew the Article 23 legislation?

I think it's probably stating the obvious to say that one key feature of a democratic capitalist society is that public opinion counts for something. Governments cannot behave autocratically (well, not all the time) and companies have to pay heed to public opinion. Of course they are free to try and influence it in their favour, so we have tobacco companies and their lackeys arguing strongly that the minority who smoke should be allowed to do so in public whatever harm that causes to everyone else. Or property companies trying to convince us that it's just fine to knock down a new housing development so that they can build another housing development in its place.  However, if public opinion goes against you, sooner or later you will have to respond, and it's usually better to do it sooner and with good grace rather insisting that you have the right to do whatever you wish because that's how capitalism works.

Of course, public opinion is sometimes wrong, and special interest groups can sometimes bring about changes that are irrational and undesirable (there's a lot of that in the land where TV shows that dare to be less than totally respectful to Ronnie Reagan mysteriously get dropped from the schedule), but generally it works well enough.

Simon isn't just worried about Hunghom Peninsula, though. Apparently, Hong Kong is in trouble:

Hong Kong was once the city that always changed, but there is an anti-development movement taking root. The multibillion-dollar Zhuhai bridge was opposed because it could affect 20 dolphins, while environmentalists vehemently opposed any new harbour reclamation despite Hong Kong's desperate need for new land. We have also seen attempts to coerce restaurateurs with proposals banning smoking in their premises. Developer Sir Gordon Wu Ying-sheung is fighting to build a new hotel on Hong Kong Island, even though he had official planning approval to go ahead with a very similar structure. Although these cases might appear different, the commonality is that they represent a fundamental attack on the right to property, including the right to decide how it should be used. In each case, the property owner's right is being threatened.

It's hard to see how the rights of property owners are being threatened by the campaigns against the Zhuhai bridge or the harbour reclamation. Last time I checked, the harbour wasn't owned by SHKP or their property developer chums (though I have to concede that there's a fair chance that they would end up developing any land reclaimed by the government). So it seems that this is a bit more radical than defending the rights of property owners - it's about the right of capitalists to make as much profit as possible without any concern for the general public or the environment. Why should we stop with a modest proposal to reclaim some land in Wan Chai when we could concrete over the Tolo Harbour, connect up Lamma, Peng Chau, Cheung Chau and Lantau to build a vast property development, and turn Victoria Harbour into a river.

Personally, I have no objection to Gordon Wu building a large hotel in Wan Chai, but as far as I am aware he has had the opportunity to do this for many years but has just never got around to it, so having waited so long he can surely wait a little longer to get everything sorted out. He might not get exactly what he wants, but he will still be able to build his hotel. Sure, it's inconvenient for him that he can't go ahead tomorrow and build just whatever he likes, but I think he'll be able to cope. 

I have to say that it's amusing to see someone defending the rights of property owners and the need for reclamation on the grounds that Hong Kong is short of land. The simple fact is that if the major property developers used up the vast land banks they already own, they could build far more apartments than Hong Kong really needs. They won't, of course, for the very same reason that they fought so hard (and successfully) to get the government to stop constructing more apartments for sale and rent, namely that high property prices suit them very well.  That's what capitalists do, given half a chance.

Actually, I'm not sure why Simon introduces these arguments when what he really believes is that Hong Kong's property developers (and banks, power companies, etc.) should have total freedom to act however they wish. It's not about providing more apartments, it's about maximising profits without regard to the impact on anyone else. I'm sure this sounds great when you are discussing it in seminars at the Ayn Rand Institute in California, but in the real world things are a little bit different.

To digress slightly, communism ultimately failed for two reasons: firstly that however fine and utopian it sounds, it doesn't work in an advanced industrial economy; and secondly because an insistence on remaining true to those original ideas made things even worse.  By contrast, capitalism has triumphed because it is implemented pragmatically.  The "free market" sounds wonderful as a theory, but we all know that in practice most companies do all they can to defeat it and prefer to operate with the minimum of compeition - which is why we have government intervention and other checks and balances that constrain full-blooded capitalism.  Of course you can argue about exactly how much regulation there should be, but if there were none, would capitalism really work?  I don't think so. The reality is that it is the pragmatic blend of capitalism, consumerism and regulation that has triumphed over communism, and letting crazy people (with their strange ideas of what is "rational") change all of that would be just as damaging as the communist experiment.

[Update: it seems that I am in good company.  Jake van der Kamp also disagrees with Simon Patkin (though strangely he credits him with being "an incisive thinker"), and there is a letter in today's SCMP also making the same basic points that I made.]

Comments

[Simon]

Jake van der Kamp had something I think in yesterday's paper on the same thing. He basically said there are more than one set of rights at play - the developers' rights don't exist in a vacuum and in theory a Government and courts exist to weigh these various rights.

[hk]

Heaven forbid we should do anything to protect our rights and fight for self-preservation.

[Tom - Daai Tou Laam]

I was looking for that original commentary online after reading it in a Pacific Coffee. I was dumbstruck.

Folks like this Simon want to brush away intangible values, like breathing clean air and the tourism prospects of heritage or an inner or outer harbour.

As for filling in the outer harbour, I've seen some pretty nasty sketches of proposed outer harbour reclamation around Lantau for container terminal use.