Monday, February 02, 2009

A Premier Speaks, Quoting Moral Sentiments

This is a story about Wen Jiabao, the Chinese Communist premier, contributed to by Lionel Barber, Geoff Dyer, James Kynge and Lifen Zhang writing in the Financial Times (UK), quoted in the Irish Times.com (Dublin) (HERE) is worth reading:

Wen gives short shrift to those who blame fiscal crisis on China”

“AN ECLECTIC reader, Wen says that when he travels he always carries a copy of The Theory of Moral Sentiments by Adam Smith, the Scottish economist, which lays out the moral underpinnings for governing societies – and market economies.

“Adam Smith wrote that in a society if all the wealth is concentrated and owned by only a small number of people, it will not be stable,” he says.

It is an observation that holds just as well for the crisis-ridden US as it does for China, with its skewed model of development and rising inequality
.”

Comment
Great to see that a Chinese communist is reading Adam Smith’s Moral Sentiments, if only to wrong foot capitalist leaders who haven’t read Moral Sentiments, or even Wealth Of Nations.

Of course, in having a go at inequality in capitalist countries, Wen, slides over the vast discrepancies in China, both economically, and overwhelmingly in political power, between the cadres of the Chinese Communist party, who double as high functionaries of the State, and the vast majority of the poor, especially in the countryside.

I don’t recognize the paraphrased comment Wen gives, allegedly from Moral Sentiments, which is about the virtues and proper behaviour of individuals, but I am more than willing to give allowance for a translation from English into Chinese and then back into English.

It may be taken, also, as a warning to China's own entrepreneurs in its stae-capitalist economy, that domestic inequality may only go so far before the State steps in with confiscatory taxation, if not outight expropriation, at some point.

One feature of Chinese State-Capitalism that may inhibit such drastic measures is the close integration of many members of the Communist Party and State bureaucracy with the domestic capitalist entrepreneurs at all levels, though that may not save foreign capitalist firms from discriminatory measures.

Wen’s response to questions about the causes of the current financial crisis are well worth reading (follow the Link).

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