this post was submitted on 01 Jul 2024
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It's interesting how through the neoliberal lens this looks like "a blow" to their economy. But from a Keynesian or MMT lens, China doesn't need high net worth individuals to drive the economy. Public investment can and has done this in China as well as many other parts of the world.
From another angle, letting high net worth individuals flee, could reduce apparent wealth inequality in China.
I mean, if they are fleeing, they are fleeing with their money. Capital is essential for an economy and if capital leaves the country, it means that you have less growth, less investment and less prosperity in general. You can't even tax that capital once it has left the country.
Plus, many of those low-millionaires are probably some of the most competent and knowledgeable people (not the hundreds-million industry captain with ties to the government, but the plant manager or lead researcher, lead developer etc. i.e. those who've made a small fortune through their ability). Getting rid of lead people is not exactly beneficial for an economy.
And sure, making everyone poor will reduce apparent wealth inequality, you're right.
It’s actually difficult to bring their money with them due to strict transfer limits. China has strict capital controls.
Even if they exfiltrate the money, China as every other fiat economy can replace it using a keyboard.
If these folks are indeed knowledgeable and experienced workers, then having them leave isn't ideal. But whether they're such people or not is an open question. They might also be people who are good at exploiting others' labor for profit, just like their western many-multi-mil counterparts.
exactly right