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Saturday, 10 October 2009
Patriotic capitalist’s son demands restitution
But almost all of the Kang family’s fortune was lost in the Communist Party’s nationalisation drive that targeted the “bourgeois” - mainly capitalists in the cities and landlords in rural areas - shortly after it took power on October 1, 1949.
Author Kang Guoxiong’s father, Kang Xinru, was a prominent banker before the founding of the People’s Republic who once controlled 60 per cent of the now defunct American-Oriental Banking Corporation in Sichuan, not to mention many other investments in property, retailing and the arts.
But almost all of the Kang family’s fortune was lost in the Communist Party’s nationalisation drive that targeted the “bourgeois” - mainly capitalists in the cities and landlords in rural areas - shortly after it took power on October 1, 1949.
From his small, two-bedroom flat in central Beijing, Kang, 80, has begun a personal crusade to trace the lost family property as part of an attempt to persuade the government to return the family fortune and re-examine ambiguous policies over private ownership.
These have been contentious issues, but the party’s refusal to address them in its 60 years of rule has raised concern in recent years, particularly among the middle class.
In a letter to President Hu Jintao in January, Kang asked that some of the historical issues revolving around the status of private ownership be looked into.
There was no systematic review of the scale of nationalisation in the 1950s or 60s, but authorities publicly admitted that the total value of seized assets that the capitalists once owned was 2.2 billion yuan when the Cultural Revolution ended in 1976. However, some historians dismissed the figure as a gross underestimate, saying the actual amount could be 10 times as much.
Kang said that like many capitalists, his father had built family wealth through industry and wisdom and they had contributed to the country’s economy and particularly the resistance against the Japanese invasion during the second world war.
He said that for decades capitalists and their families were forced to live as lower-class people, and now it was time for a re-examination of whether they had tried to cheat others, or whether they had benefited the country.
Kang said his father was sent to a rural labour camp during the Cultural Revolution for “re-education” and had also been jailed for being the son of a capitalist and for his friendship with Chiang Kai-shek.
Kang said his father had acquired 60 per cent of American-Oriental Banking Corporation in Sichuan in 1927 after the then, American, owners had been forced to leave the country amid rising xenophobia.
Even when the bank was liquidised in 1960, it still held major stakes in 66 companies in Sichuan, all of which had been nationalised under various schemes.
Also nationalised were the rest of the family’s properties, including a Beijing courtyard house, and other assets such as art, which were either forcibly sold to the government very cheaply or were looted during the Cultural Revolution.
Professor Mao Yushi of the Unirule Institute of Economics in Beijing said that stripping the bourgeois of their assets in the name of nationalisation was a populist decision for the government, as it would have the backing of the majority, and such a stance against private ownership helped the Communist Party to consolidate its grip on power.
“But if a social system condones the flagrant disregard of private ownership, it has little hope of developing, because it does not abide by the rules,” Mao said.
Deng Xiaoping’s “reform and opening up” in the late 1970s put the country on track to developing a market economy with a flourishing private sector at the core. Economists say that was a period when state sectors were in retreat, while the private sector marched onwards.
The privatisation drive injected a dose of entrepreneurship into otherwise inefficient state-owned firms, but state assets were also lost or went into decline, and the privatisation push was blamed for it.
The collapse in world financial markets has further swayed opinion against the free market and private entrepreneurship. Much of the central government’s 4 trillion yuan (HK$4.5 trillion) stimulus package is expected to benefit state-owned companies. Dismayed market economists say that will lead “to state sectors marching on, while the private sectors cede ground”.
Mao, at the Unirule Institute, said the country had a long tradition of farmer-led uprisings against private ownership, and a collective desire to take away wealth from the rich, which had never been denounced.
“The need to protect private ownership [in a market economy] without denouncing previous hostile policies towards private ownership would leave much room for potential social unrest,” Mao said.
One area to watch for trouble because of ownership ambiguity is in rural land development. Rural land is owned collectively by farmers, but they have little say over how their land is used. Instead, township authorities and village heads are given unfettered rights over such land.
In urban areas where people bought “full property rights”, they would lose the rights to their homes after 70 years, another time bomb.
Mao said the property law introduced two years ago had been a step forward in safeguarding private ownership, but was still a product of the old school of thought under the planned economy.
But Kang said he was emboldened by the new law to seek justice by documenting lost family assets via government archives.
In a party history book published in 2002, Kang’s father was referred to as a friend, along with several prominent businesspeople in Chongqing. However, Kang said that given all that capitalists had done for China, he was unhappy that his letter to Hu, asking him to look at the issue of private assets, was unanswered.
“Is that the way you’re supposed to treat your friends?” he asked.
2 comments:
Patriotic capitalist’s son demands restitution
Raymond Li
08 October 2009
Author Kang Guoxiong’s father, Kang Xinru, was a prominent banker before the founding of the People’s Republic who once controlled 60 per cent of the now defunct American-Oriental Banking Corporation in Sichuan, not to mention many other investments in property, retailing and the arts.
But almost all of the Kang family’s fortune was lost in the Communist Party’s nationalisation drive that targeted the “bourgeois” - mainly capitalists in the cities and landlords in rural areas - shortly after it took power on October 1, 1949.
From his small, two-bedroom flat in central Beijing, Kang, 80, has begun a personal crusade to trace the lost family property as part of an attempt to persuade the government to return the family fortune and re-examine ambiguous policies over private ownership.
These have been contentious issues, but the party’s refusal to address them in its 60 years of rule has raised concern in recent years, particularly among the middle class.
In a letter to President Hu Jintao in January, Kang asked that some of the historical issues revolving around the status of private ownership be looked into.
There was no systematic review of the scale of nationalisation in the 1950s or 60s, but authorities publicly admitted that the total value of seized assets that the capitalists once owned was 2.2 billion yuan when the Cultural Revolution ended in 1976. However, some historians dismissed the figure as a gross underestimate, saying the actual amount could be 10 times as much.
Kang said that like many capitalists, his father had built family wealth through industry and wisdom and they had contributed to the country’s economy and particularly the resistance against the Japanese invasion during the second world war.
He said that for decades capitalists and their families were forced to live as lower-class people, and now it was time for a re-examination of whether they had tried to cheat others, or whether they had benefited the country.
Kang said his father was sent to a rural labour camp during the Cultural Revolution for “re-education” and had also been jailed for being the son of a capitalist and for his friendship with Chiang Kai-shek.
Kang said his father had acquired 60 per cent of American-Oriental Banking Corporation in Sichuan in 1927 after the then, American, owners had been forced to leave the country amid rising xenophobia.
Even when the bank was liquidised in 1960, it still held major stakes in 66 companies in Sichuan, all of which had been nationalised under various schemes.
Also nationalised were the rest of the family’s properties, including a Beijing courtyard house, and other assets such as art, which were either forcibly sold to the government very cheaply or were looted during the Cultural Revolution.
Professor Mao Yushi of the Unirule Institute of Economics in Beijing said that stripping the bourgeois of their assets in the name of nationalisation was a populist decision for the government, as it would have the backing of the majority, and such a stance against private ownership helped the Communist Party to consolidate its grip on power.
“But if a social system condones the flagrant disregard of private ownership, it has little hope of developing, because it does not abide by the rules,” Mao said.
Deng Xiaoping’s “reform and opening up” in the late 1970s put the country on track to developing a market economy with a flourishing private sector at the core. Economists say that was a period when state sectors were in retreat, while the private sector marched onwards.
The privatisation drive injected a dose of entrepreneurship into otherwise inefficient state-owned firms, but state assets were also lost or went into decline, and the privatisation push was blamed for it.
The collapse in world financial markets has further swayed opinion against the free market and private entrepreneurship. Much of the central government’s 4 trillion yuan (HK$4.5 trillion) stimulus package is expected to benefit state-owned companies. Dismayed market economists say that will lead “to state sectors marching on, while the private sectors cede ground”.
Mao, at the Unirule Institute, said the country had a long tradition of farmer-led uprisings against private ownership, and a collective desire to take away wealth from the rich, which had never been denounced.
“The need to protect private ownership [in a market economy] without denouncing previous hostile policies towards private ownership would leave much room for potential social unrest,” Mao said.
One area to watch for trouble because of ownership ambiguity is in rural land development. Rural land is owned collectively by farmers, but they have little say over how their land is used. Instead, township authorities and village heads are given unfettered rights over such land.
In urban areas where people bought “full property rights”, they would lose the rights to their homes after 70 years, another time bomb.
Mao said the property law introduced two years ago had been a step forward in safeguarding private ownership, but was still a product of the old school of thought under the planned economy.
But Kang said he was emboldened by the new law to seek justice by documenting lost family assets via government archives.
In a party history book published in 2002, Kang’s father was referred to as a friend, along with several prominent businesspeople in Chongqing. However, Kang said that given all that capitalists had done for China, he was unhappy that his letter to Hu, asking him to look at the issue of private assets, was unanswered.
“Is that the way you’re supposed to treat your friends?” he asked.
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