A recent article in The Economist regarding China’s approach to Hong Kong had within it a hidden pearl of wisdom. Whilst overall critical of the Chinese policy in Hong Kong, there was also a focus on the impact on the financial sector in Hong Kong. The financial sector has a business model that is traditionally “Western” in its orientation with the goal of being part of the international “free market” and “Neo-liberal” system. But does that business model deliver results for society?
As noted by The Economist, Chinese leadership has “an ideological distaste for high finance among party bosses who see the proper role of banks as supporting the real economy by lending to businesses that make and sell tangible products.” That comment captures very well an appropriate criticism of the “Western” approach to the financial system that has unfortunately not focused on the real economy but rather on making money from money and trading financial products without considering if those activities deliver any real value to society other than supporting high levels of bonuses for bankers.
