Huaxi, the richest town (which only a few years ago was nothing but a farming community) in china laughs off the financial crisis. In addition to the little benefits that the state provides them, the town's governing body provides each individual with free quality housing, a free car and all of the town's businesses are collectively owned so in addition to their salary they get bonuses and share the profit of these businesses(which combined, reported profit of 2.6 billion british pounds in 2007). While such a system obviously has the greatest benefits for a community that a few years ago was barely able to provide for itself, it of course as every other thing has its downsides. Residents who leave the town for good cannot take some of the provided property by the town's government/businesses. Shops , clubs and about everything is closed before 10 pm to prevent the people from oversleeping and reducing their productivity. Migrants are provided with the same salaries as the locals, but they are not allowed any capital..but of course they can apply for permanent residencies. I find this town's experience to be very interesting amidst the current global recession turmoil. One could fairly say that the greater good has been achieved in this town but maybe on the expense of the personal good at some level.
Where does the town get their income? What are business's that support this economy. I am interested. From the linked article I found this: My question is who actually control these interests? And will the prosperity last if the profit level is put in a position where it is vulnerable to outside interests? Or is it already based on an outside market which may collapse at any time? http://blogs.telegraph.co.uk/malcol...s_richest_village_laughs_off_financial_crisis Sounds like the crap we heard about the US economy being sound. I hope they take their yuan and put it in a safe place for a rainy day when the picture isn't so rosey.
The businesses are officially 100% the town's property, so the town's government handles those interests. Each company of course has its own management and top executives but they ultimately answer to the town's governing body. I think of course their profit will be affected by outside forces such as the financial crisis, but I did a little research a few month ago for college on China's economy and the crisis and its safe to assume that they will not be affected as nearly as the US or the UK because china already has a huge trade surplus that will help them go through it easily until they can stimulate domestic demand more or expand in new markets due to the fallen exports to western markets and their western assets / investments are mildly affected. And as far as the town's concerned I have read somewhere (can't find the article at the moment) that they manufacture primarily for demand in Shanghai and Beijing they also have exporting businesses so they might be slightly affected but nothing drastic like whats happening in the states. But assuming that all their businesses are at risk and failing, the level of prosperity of course will be collectively affected as it is when its making profit.
Here is a couple more articles although they may be biased and dated a bit. http://english.cri.cn/3126/2008/10/01/1781s410806.htm http://www.guardian.co.uk/world/2005/may/10/china.jonathanwatts
That's funny, communism is all about achieving something like this but they failed until capitalists came and set up mill towns.
