That is my other Bloomberg column for this week, here is one excerpt:
Still, actual life in Hong Kong seemed to be pretty free, especially compared to the available alternatives, which included the totalitarian state that was Mao’s China. Yet as the British lease on Hong Kong approached expiration, an even deeper problem with a non-democratic Hong Kong became evident: Because there was no legitimate alternative sovereign to protest, the British simply handed the territory over to China. (Compare Hong Kong’s experience to that of Taiwan, which did evolve into a free democratic state and remains independent.) Hong Kong was bartered away like a piece of colonial merchandise. Everyone learned the hard way that democracy really does matter.
Hong Kong still ranks near or at the top of several indices of economic freedom. But that may be a sign these indices have lost touch with the nature of liberty. In Hong Kong, the notion of a credible commitment to the future ceased to have meaning some time ago. Not only is there the specter of Chinese intervention, but there is also a broader understanding that the rules of the game can change at any time, including of course when it comes to extradition procedures. Meanwhile, many Hong Kong residents know their behavior is being monitored and graded, and they know the role of the Chinese government will only grow.
Thus is revealed a deeper lesson still: Freedom is not merely the ability to buy and sell goods at minimum regulation and a low tax rate, variables that are readily picked up by economic freedom indices. Freedom is also about the narratives people live by and the kind of future they imagine for themselves. Both of these are greatly affected by the legitimacy and durability of their political institutions.
The piece also offers a brief discussion of the Bruce Lee movie “Enter the Dragon.”