The next billionaire challenge: China's wealthiest

Chen Guang-biao, 42, made a fortune in the demolition business. He pledges to give it all away.
Chen Guang-biao, 42, made a fortune in the demolition business. He pledges to give it all away.

by Bill Powell, contributor

 

FORTUNE -- It's already become known as the Billionaires Banquet in Beijing -- a gathering set for September 29th, hosted by two of the richest and most famous businessmen in the world: Warren Buffett and Bill Gates. Their guests are supposed to be 50 of their recently minted brethren from China, the richest of the newly rich in the world's fastest growing economy -- now the world's second largest, and someday destined to be the biggest.

 

You'd think the money and business obsessed Chinese elite would be beating down the door to attend such an event, to offer toasts and swap pearls of financial and business wisdom with the two American legends. And you'd probably be right, were it not for one thing: Gates and Buffet are coming to push their pet cause -- the so called Billionaires Pledge -- trying to persuade the rich, no matter where they may live, to donate half of their wealth to charitable causes.

 

In the United States, this is hardly the stuff of controversy. Charitable giving is a core American trait -- having two of the richest in the land out stumping for the wealthy to be ever more generous is a dog bites man story. To most Americans, they might as well be telling kids to do their homework and eat more vegetables.

 

Which is precisely what makes the reaction in China to the forthcoming banquet so interesting: the response so far has apparently been underwhelming. The first thing at least a few of the invited did was to call and quietly check to make sure they weren't going to have the arm put on them immediately. A "small number" of the more than 50 invited guests called to ask if they would be required to pledge a donation at the dinner, says Jing Zhang, press officer of the Bill and Melinda Gates Foundation, which is coordinating the Sept. 29 event. The answer to that was no -- all Gates and Buffett want to do is talk.

 

The conversation could be interesting. The accumulation of big time wealth is obviously a relatively new phenomenon in modern China. In the last thirty years, since Deng Xiaoping's economic opening, this country has created a staggering number of wealthy people: a survey called the Hurun report, which tries to keep tabs on just how many rich Chinese there are, pegs the number of millionaires at 875,000 -- a figure which, to put it politely, is a conservative estimate. (To put it impolitely, it's ludicrously low.)

 

But since the vast, vast majority of Chinese citizens still get by on $100 a month or less, the gap between rich and poor is large and getting larger -- and thus is an extremely sensitive issue for the government in Beijing. Add to that the fact that tax collection tends to be haphazard, and that corruption remains a major issue in China, and you can understand why so many rich Chinese work very hard NOT to stand out. The idea of holding a press conference, as Buffett did famously four years ago, to say you're going to give it all away only draws scrutiny of the kind that few Chinese want (`well, just how much do you have, anyway...?'). Merely showing up at the Buffett and Gates dinner will be sufficient to create a whose-richer- than-whom frenzy in China's blogosphere that not many of these newly rich tycoons can really want.

 

China's most prominent philanthropist

The most notable exception to this general rule so far has been Chen Guang-biao, a businessman from Jiangsu, one of China's most prosperous provinces. He started in the demolition business (modern China has done an awful lot of blowing up the old to make room for the new) and now runs a company called Jiangsu Huangpu Renewable Resources, which takes material from old, demolished buildings and recycles it into usable products. Chen announced on September 7 that he would leave his entire fortune -- estimated last year at around $660 million -- to charity.

 

"It's a noble and great move to return your fortune to the world when you are about to leave," he says, "and shameful the other way if you die with it. So I will donate all my property to philanthropy instead of just half of it when I'm leaving."

 

In an interview with Fortune, Chen said flatly that he doesn't think a sufficient number of wealthy Chinese "have the right values" to donate more to charity, but he believes over time China will be as philanthropic as any other country. Chen says he was motivated to go public with his pledge in part because he had heard that the response to the Buffett-Gates dinner had been lackluster. That, needless to say, is not going to win him a lot of friends among his peers in today's China.

 

It'll likely be awhile before Chen has to make good on his pledge. Like most of China's new rich, he's a young man -- just 42. But he is already China's most prominent philanthropist. He was out front responding -- in terms of both money and material -- to the devastating Sichuan earthquake in 2008, and again when a quake hit the rural province of Qinghai earlier this year.

And, to be fair, philanthropy in China is growing, albeit from a small base. According to the Hurun Report, China's fifty most generous contributors last year donated $1.2 billion, or an average of $25 million. That's chump change by U.S. standards, but it's eight times the average in 2004, when Hurun first began reporting on charitable donations in China.

 

But the attitude Chen and those following in his wake evince toward charity remains distinctly rare in today's China. The country's private entrepreneurs, many of whom started small, family businesses, believe wealth should be kept in the family and reinvested (something that's easy to do now given that China has talked for years about implementing an inheritance tax but still hasn't.)

 

More typical is the attitude of Zong Qing Hou, the CEO of beverage maker Wahaha, who topped Forbes' list of the richest people in China this year. He admitted he turned down an invitation to the Billionaire's Banquet because of a scheduling conflict. But, he told a Chinese newspaper, "from the bottom of my heart I don't appreciate this sort of thing. Real charity, he said, means creating real fortunes for society -- entrepreneurs using the money to invest and create even more job opportunities and more wealth for a society. That's what our society needs."

 

Too bad he can't be at the Billionaires Banquet. With him and Chen at the table, the two Americans wouldn't have to do much talking. They could sit back and listen to the argument -- one that now, thanks to them, is front and center among China's very rich.

 

Write a comment

Comments: 2
  • #1

    Everest/Mike (Monday, 13 September 2010 09:28)

    It is apparently philanthropy in China has a long way to go due to how the riches get rich before the vast population of poor do. A long way to go~

  • #2

    Everest/Mike (Monday, 13 September 2010 09:29)

    as the other aspects...

Fri

13

Nov

2015

Are Languages Products of their Environment?


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DISCOVER MAGAZINE published this very interesting article: 


  Languages Are Products of Their Environments


The characteristics that make each language unique may actually be adaptations to the acoustics of different environments.

2 Comments

Tue

03

Jun

2014

The Case for Reparations

 

The Case for Reparations

 

Two hundred fifty years of slavery. Ninety years of Jim Crow. Sixty years of separate but equal. Thirty-five years of racist housing policy. Until we reckon with our compounding moral debts, America will never be whole.

 

By Ta-Nehisi Coates

May 21, 2014

 


Chapters

  1. I. “So That’s Just One Of My Losses”
  2. II.  “A Difference of Kind, Not Degree”
  3. III. “We Inherit Our Ample Patrimony”
  4. IV. “The Ills That Slavery Frees Us From”
  5. V. The Quiet Plunder
  6. VI. Making The Second Ghetto
  7. VII. “A Lot Of People Fell By The Way”
  8. VIII. “Negro Poverty is not White Poverty”
  9. IX. Toward A New Country
  10. X. “There Will Be No ‘Reparations’ From Germany”
0 Comments

Mon

02

Jun

2014

A Look At 19th Century Children In The USA

PHILADELPHIA — DINNER with your children in 19th-century America often required some self-control. Berry stains in your daughter’s hair? Good for her. Raccoon bites running up your boy’s arms? Bet he had an interesting day.

 

As this year’s summer vacation begins, many parents contemplate how to rein in their kids. But there was a time when Americans pushed in the opposite direction, preserved in Mark Twain’s cat-swinging scamps. Parents back then encouraged kids to get some wildness out of their system, to express the republic’s revolutionary values.

The New York Times

Sunday Review

By JON GRINSPAN MAY 31, 2014

 

A late 19th century family taking a stroll down a set of railroad tracks
A late 19th century family taking a stroll down a set of railroad tracks

American children of the 19th century had a reputation. Returning British visitors reported on American kids who showed no respect, who swore and fought, who appeared — at age 10 — “calling for liquor at the bar, or puffing a cigar in the streets,” as one wrote. There were really no children in 19th-century America, travelers often claimed, only “small stuck-up caricatures of men and women.”

 

This was not a “carefree” nation, too rough-hewed to teach proper manners; adults deliberately chose to express new values by raising “go-ahead” boys and girls. The result mixed democracy and mob rule, assertiveness and cruelty, sudden freedom and strict boundaries. Visitors noted how American fathers would brag that their disobedient children were actually “young republicans,” liberated from old hierarchies. Children were still expected to be deferential to elders, but many were trained to embody their nation’s revolutionary virtues. “The theory of the equality” was present at the ballot box, according to one sympathetic Englishman, but “rampant in the nursery.”

 

Boys, in particular, spent their childhoods in a rowdy outdoor subculture. After age 5 or so they needed little attention from their mothers, but were not big enough to help their fathers work. So until age 10 or 12 they spent much of their time playing or fighting.

 

The writer William Dean Howells recalled his ordinary, violent Ohio childhood, immersed in his loose gang of pals, rarely catching a “glimpse of life much higher than the middle of a man.” Howells’s peers were “always stoning something,” whether friends, rivals or stray dogs. They left a trail of maimed animals behind them, often hurt in sloppy attempts to domesticate wild pets.

 

And though we envision innocents playing with a hoop and a stick, many preferred “mumbletypeg” — a game where two players competed to see who could throw a knife closer to his own foot. Stabbing yourself meant a win by default.

 

Left to their own devices, boys learned an assertive style that shaped their futures. The story of every 19th-century empire builder — Carnegie, Rockefeller, Vanderbilt — seems to begin with a striving 10-year-old. “Boy culture” offered training for the challenges of American manhood and a reprieve before a life of labor.

 

But these unsupervised boys also formed gangs that harassed the mentally ill, the handicapped and racial and ethnic minorities. Boys played an outsize role in the anti-Irish pogroms in 1840s Philadelphia, the brutal New York City draft riots targeting African-Americans during the Civil War and attacks on Chinese laborers in Gilded Age California. These children did not invent the bigotry rampant in white America, but their unrestrained upbringing let them enact what their parents mostly muttered.

 

Their sisters followed a different path. Girls were usually assigned more of their mothers’ tasks. An 8-year-old girl would be expected to help with the wash or other physically demanding tasks, while her brother might simply be too small, too slow or too annoying to drive the plow with his father. But despite their drudgery, 19th-century American girls still found time for tree climbing, bonfire building and waterfall-jumping antics. There were few pretty pink princesses in 19th-century America: Girls were too rowdy and too republican for that.

 

So how did we get from “democratic sucklings” to helicopter parents? Though many point to a rise of parental worrying after the 1970s, this was an incremental change in a movement that began a hundred years earlier.

 

In the last quarter of the 19th century, middle-class parents launched a self-conscious project to protect children. Urban professionals began to focus on children’s vulnerabilities. Well-to-do worriers no longer needed to raise tough dairymaids or cunning newsboys; the changing economy demanded careful managers of businesses or households, and restrained company men, capable of navigating big institutions.

 

Demographics played a role as well: By 1900 American women had half as many children as they did in 1800, and those children were twice as likely to live through infancy as they were in 1850. Ironically, as their children faced fewer dangers, parents worried more about their protection.

 

Instead of seeing boys and girls as capable, clever, knockabout scamps, many reconceived children as vulnerable, weak and naïve. Reformers introduced child labor laws, divided kids by age in school and monitored their play. Jane Addams particularly worked to fit children into the new industrial order, condemning “this stupid experiment of organizing work and failing to organize play.”

 

There was good reason to tame the boys and girls of the 19th century, if only for stray cats’ sake. But somewhere between Jane Addams and Nancy Grace, Americans lost track of their larger goal. Earlier parents raised their kids to express values their society trumpeted.

 

“Precocious” 19th-century troublemakers asserted their parents’ democratic beliefs and fit into an economy that had little use for 8-year-olds but idealized striving, self-made men. Reformers designed their Boy Scouts to meet the demands of the 20th century, teaching organization and rebalancing the relationship between play and work. Both movements agreed, in their didactic ways, that playtime shaped future citizens.

 

Does the overprotected child articulate values we are proud of in 2014? Nothing is easier than judging other peoples’ parenting, but there is a side of contemporary American culture — fearful, litigious, controlling — that we do not brag about but that we reveal in our child rearing, and that runs contrary to our self-image as an open, optimistic nation. Maybe this is why sheltering parents come in for so much easy criticism: A visit to the playground exposes traits we would rather not recognize.

 

There is, however, a saving grace that parents will notice this summer. Kids are harder to guide and shape, as William Dean Howells put it, “than grown people are apt to think.” It is as true today as it was two centuries ago: “Everywhere and always the world of boys is outside of the laws that govern grown-up communities.” Somehow, they’ll manage to go their own way.

 

________________________________

 

A National Endowment for the Humanities fellow at the Massachusetts Historical Society who is writing a book on the role of young people in 19th-century American democracy.

0 Comments

Mon

21

Apr

2014

Investigating Family's Wealth, China's Leader Signals a Change

From The New York Times 

By CHRISTOPHER DREW and JAD MOUAWAD

APRIL 19, 2014

 

HONG KONG — His son landed contracts to sell equipment to state oil fields and thousands of filling stations across China. His son’s mother-in-law held stakes in pipelines and natural gas pumps from Sichuan Province in the west to the southern isle of Hainan. And his sister-in-law, working from one of Beijing’s most prestigious office buildings, invested in mines, property and energy projects.

 

In thousands of pages of corporate documents describing these ventures, the name that never appears is his own: Zhou Yongkang, the formidable Chinese Communist Party leader who served as China’s top security official and the de facto boss of its oil industry.





A visitor at the Zhou family's ancestral graves in Xiqliantou, eastern China.  Intrigue surrounds the family after a spate of arrests.  Sim Chi Yim for the New York Times
A visitor at the Zhou family's ancestral graves in Xiqliantou, eastern China. Intrigue surrounds the family after a spate of arrests. Sim Chi Yim for the New York Times

But President Xi Jinping has targeted Mr. Zhou in an extraordinary corruption inquiry, a first for a Chinese party leader of Mr. Zhou’s rank, and put his family’s extensive business interests in the cross hairs.

 

Even by the cutthroat standards of Chinese politics, it is a bold maneuver. The finances of the families of senior leaders are among the deepest and most politically delicate secrets in China. The party has for years followed a tacit rule that relatives of the elite could prosper from the country’s economic opening, which rewarded loyalty and helped avert rifts in the leadership.

Zhou Family Ties

1 Comments

Fri

13

Nov

2015

Are Languages Products of their Environment?


shutterstock_222422665_151112


DISCOVER MAGAZINE published this very interesting article: 


  Languages Are Products of Their Environments


The characteristics that make each language unique may actually be adaptations to the acoustics of different environments.

2 Comments

Tue

03

Jun

2014

The Case for Reparations

 

The Case for Reparations

 

Two hundred fifty years of slavery. Ninety years of Jim Crow. Sixty years of separate but equal. Thirty-five years of racist housing policy. Until we reckon with our compounding moral debts, America will never be whole.

 

By Ta-Nehisi Coates

May 21, 2014

 


Chapters

  1. I. “So That’s Just One Of My Losses”
  2. II.  “A Difference of Kind, Not Degree”
  3. III. “We Inherit Our Ample Patrimony”
  4. IV. “The Ills That Slavery Frees Us From”
  5. V. The Quiet Plunder
  6. VI. Making The Second Ghetto
  7. VII. “A Lot Of People Fell By The Way”
  8. VIII. “Negro Poverty is not White Poverty”
  9. IX. Toward A New Country
  10. X. “There Will Be No ‘Reparations’ From Germany”
0 Comments

Mon

02

Jun

2014

A Look At 19th Century Children In The USA

PHILADELPHIA — DINNER with your children in 19th-century America often required some self-control. Berry stains in your daughter’s hair? Good for her. Raccoon bites running up your boy’s arms? Bet he had an interesting day.

 

As this year’s summer vacation begins, many parents contemplate how to rein in their kids. But there was a time when Americans pushed in the opposite direction, preserved in Mark Twain’s cat-swinging scamps. Parents back then encouraged kids to get some wildness out of their system, to express the republic’s revolutionary values.

The New York Times

Sunday Review

By JON GRINSPAN MAY 31, 2014

 

A late 19th century family taking a stroll down a set of railroad tracks
A late 19th century family taking a stroll down a set of railroad tracks

Read More 0 Comments

Mon

21

Apr

2014

Investigating Family's Wealth, China's Leader Signals a Change

From The New York Times 

By CHRISTOPHER DREW and JAD MOUAWAD

APRIL 19, 2014

 

HONG KONG — His son landed contracts to sell equipment to state oil fields and thousands of filling stations across China. His son’s mother-in-law held stakes in pipelines and natural gas pumps from Sichuan Province in the west to the southern isle of Hainan. And his sister-in-law, working from one of Beijing’s most prestigious office buildings, invested in mines, property and energy projects.

 

In thousands of pages of corporate documents describing these ventures, the name that never appears is his own: Zhou Yongkang, the formidable Chinese Communist Party leader who served as China’s top security official and the de facto boss of its oil industry.





A visitor at the Zhou family's ancestral graves in Xiqliantou, eastern China.  Intrigue surrounds the family after a spate of arrests.  Sim Chi Yim for the New York Times
A visitor at the Zhou family's ancestral graves in Xiqliantou, eastern China. Intrigue surrounds the family after a spate of arrests. Sim Chi Yim for the New York Times

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