Still trying my best to understand the chinese culture and mindset, and I wanted to blog about a common story or reminder I am told here – you can get rich in China – BUT DON’T GET TOO RICH!!!
There isn’t a specific phrase or poem that I know of, but the basic idea is, make money, grow your business, but keep your mouth shut. And its almost that everyone has to bend the rules and test the boundaries to get ahead, its almost expected that way. The idea is that if there isn’t a specific law stating that something is illegal or bad – then it is OK to do. Its not about it being right or wrong, it is about it being there being a specific law in the books. So imagine how long and huge the rulebook will become!!
Anyway, with that in mind, imagine the country developing so quickly, and in order to make money, the businessman must test limits with what is wrong and right. So the best businessman, the richest, most connected is then looked at like jealously by many. And many try to copy him or her – why can’t “i be like him/her too” – so they study and analyze the way the successful businessman has done.
Here is a recent article from Associate Press (via yahoo finance) about Chinese billionaire Huang Guangyu
Chinese appliance tycoon jailed for 14 years
Chinese appliance tycoon, once country’s richest man, jailed for 14 years in stock caseJoe Mcdonald, AP Business Writer, On Tuesday May 18, 2010, 1:24 am
BEIJING (AP) — An appliance retailer who was China’s richest businessman was sentenced Tuesday to 14 years in prison for insider trading, bribery and other offenses in the latest of a spate of misconduct cases against newly rich Chinese tycoons.
Huang Guangyu built Gome Electronics into China’s biggest appliance retailer and once was estimated to be worth $6.3 billion. His abrupt downfall reflected the uncertain status of entrepreneurs in China, where an economic boom has created dozens of billionaires but a string of business leaders have been jailed on financial charges.
<<….>> Huang was detained in November 2008 and resigned as Gome’s chairman the following year.
Huang also was convicted of an unspecified “illegal operation” and leaking information, the government announced. The state-run China News Service said charges against him included paying 4.6 million yuan ($675,000) in bribes to five government employees and insider trading of Gome shares worth 1.4 billion yuan ($204 million).
A string of entrepreneurs who were among China’s most successful have been jailed after running afoul of the law.
Mou Qizhong, who also once held the title of China’s richest man, is serving a life sentence for bank fraud. Shanghai developer Zhou Zhengyi was sentenced in 2008 to 16 years for bribery, tax receipt forgery and embezzlement.
Huang’s rise was the classic tale of poor boy makes good amid China’s rapid growth after then-supreme leader Deng Xiaoping launched reforms in 1979 that allowed millions of Chinese to drag themselves out of poverty.
Born in Shantou in the southern province of Guangdong, near Hong Kong, Huang came to Beijing as a teenager and became a clothing trader.
He switched to appliances, jumping on a retailing boom as Chinese families bought refrigerators, televisions and washing machines. Gome has grown to more than 1,100 stores and employs 300,000 people.
By 2008, Huang ranked No. 1 on a list of China’s wealthiest entrepreneurs compiled by Shanghai-based analyst Rupert Hoogewerf, with a net worth of US$6.3 billion.
So reading this article, you get a few ideas…..and conclusions:
- China is finally allowing the “poor, hard working” to build a business from nothing – giving a more capitalist and even playing field
- China’s business laws and ethics are not developed enough to control the recent boom from its economic growth
Therefore, what happens……the ones who succeed in a system that is not yet developed legally and economically are ones who can “push the envelope”. But the problem is, the mentality “but everyone is doing it”. If you don’t do it, then you risk being left behind.
Then, you become a multi billionaire, you have tons of government and business connections….but then, you are too big. People are jealous of you. One night at dinner, you’re drunk and offend a government official. Political changes. A change of power. You don’t pay enough to someone.
Next thing you know, your house is raided by police, you’re arrested. Your once good alliances in the government and in big business rat you out. You’re done, in jail, lost business and everything you’ve built.
Sad, because I am sure this businessman, like many who made it to the top, worked hard and endlessly night and day for years and years. But yes, he cut corners, he got greedy. And like a “godfather” mafia movie, he got pinched and ratted out by his friends, and now he’s cut off.
So yes, in China, if you make money, keep your mouth shut, and don’t become the biggest and richest. Interesting mindset.