The biggest auction on earth Before long, hard times again compelled Communist Party Leaders to look to the private sector for salvation. The privatization and reconstitution wave at the end of 1990s saw thousands of medium-sized SOEs disappear and millions of workers lose their jobs. This seems like an embrace of market discipline, but Huang from MIT thinks, it has flaws in two ways. First of all, it was stealthy. Assets sales took place without proper laws and legal frameworks. As a result, there was no guarantee on property right and asset subjects to subsequent state seizure as well as appropriation by insiders. Secondly, leaders remained cautious about market forces. Peripheral privatization is only a strategy to keep political control. Chinese leadership reveals that the purpose of reforms is to “ grasp the large , release the small”: the main purpose is not to increase efficiency at SOEs and benefit customers by competition. On contrary, it is for forming bigger and more dominant national giants controlled by the party. The proof is in the pudding. SASC’s capital base increased from 7100b dollars in 2003 to 21000b in 2009. If taking into account of 150 thousands of SOEs, the number will exceed 100000b. Therefore, if taken seriously, there must be bold , transparent, and long-term efforts, like making thoughtful plans and winding down national shares in areas dominated by the country. If this can take place in phases in the following 10 years, it will give the market enough time to absorb inevitable sell-offs, mergers, and bankruptcies. Successful experience with privatization in these industries around the world belies the Communist Party’ claim that there are too strategic to be left in private hands.

Charity in China: translated from the Economist (In Chinese) Buffet and Gates used to hold charity banquets for Chinese billionaires in 2010 in order to win them over to philanthropy. Yet they got the cold shoulder. Many wealthy entrepreneurs declined to come and those in the banquet did not sign the “donation commitment”. This meanness was not because of penury: China has more billionaires than American now. When being asked about why him and other rebuffed the evangelisers, Ma Yun, the boss of e-commerce giant Alibaba, said it was not because they are stingy. In a charity conference held in Hang Zhou this month, he explained that Chinese charity industry is still in its infancy. Since then, the outlook has improved. Though Chinese charitable donation is still behind America, it is trending upwards. American Chinese billionaire Tang mentioned another banquet--- held jointly by Pan and C100 for tycoons in Beijing. Unlike at the frosty meeting in 2010 with the “two white men” telling them to give away money, this time, Chinese bosses send enthusiastic feedback to his exhortations on how to share wealth. One reason for this shift in attitude is a generational change. Harvard scholars studied donation patterns of those having the most donations. In the past, the most generous are real estate tycoons. They mainly donated to education institutions, especially those elite universities located in their wealthy home provinces. This is a cautious approach suited to a political system where earning pots of money just becomes the ordinary phenomenon. As the economy modernises, a crop of middle-aged tech billionaires enthusiastic about “ democranizing charity” has emerged. On the eve of Alibaba’s IPO one year ago, Ma and the co-founder of Alibaba made a donation equal to 2 per cent of the company’s value. Chinese gaming and social media giant Tecent, its founder, Ma said its company made a donation worth over 2 b stocks. Many entrepreneurs are following their lead. Like two Mas have done through their respective charity divisions, the younger generation is more likely to make donations in politically sensitive areas like environment and public health. They would also tap into technologies such as mobile network and cloud computing to help modernize the operation of the charity institutions.