Why Hong Kong's $6,000 Handout To Every Citizen Is "Suicide For The Government"

I personally have no interest to write more on the Government Budget. 

But this morning, the government decided to give HK$6,000 to each citizen above 18 year olds, provide 75% income-tax rebate (max HK$6,000), and withdraw the proposal to inject HK$6,000 into each mandatory provident fund (MPF) account.

This is quite simply a suicide for the government.  In the first place, the problems of the Budget, in my view, wasn’t that the government should distribute money, but that there is no vision, no long-term focus, and ignore the problems of Hong Kong.  By rejecting public demand to distribute money and then yielding to public demand within just a week, the government is hurting their own credibility.

The government has been failed in so many respects.  The fact that the Hong Kong government manages to create crisis after crisis is an achievement.  The government has very little credibility to start with, and now it is committing suicide by demonstrating how public demand can force the government to do what the public want, however right or wrong it can be.




This article originally appeared here: Hong Kong: Changes To The Budget 2011-12
Also sprach Analyst – World & China Economy, Global Finance, Real Estate

Related Posts

  • Hong Kong Budget 2011-12: Where Should The Surplus Really Be Going To?
  • Hong Kong Budget 2011: What Not To Expect As Far As Property Market Is Concerned
  • Hong Kong Budget 2011-12: Highlights and Analysis of Housing Policy
  • Hong Kong Policy Address 2010-2011: Analysis of Housing Policy
  • Hong Kong Real Estate: What drives Hong Kong property prices

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.