
Rich Chinese continue to flee China - Cbasedlifeform
http://www.cnbc.com/id/101345275
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sologoub
Sounds similar to the general sentiment in Russia for the past two decades.
The grab and run attitudes are also taking a toll on infrastructure and
general business reinvestment. If you are unsure of the future, why invest for
the long term?

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huhtenberg
Based on what I heard and read there were very significant restrictions put in
place in recent years that effectively disable the export of the capital from
Russia. You still can "grab", bribe, grease and grow rich, but all your money
will stay in the country.

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ash
I haven't heard of it. Could you be more specific about restrictions on
capital export?

I believe those restrictions won't work when goods and people could move
across borders without problems.

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wisty
People in China can't. They have to go through customs, which forbids taking
large sums of cash. And you can't electronically move money in or out of China
so easily. The banks have restrictions.

There's ways around it. Suitcases full of cash (or gold) which you hope the
customs officials won't notice, multiple trips to Hong Kong, junket trips
(paying for credit at a casino in Macao, then "withdrawing" through a roulette
table). There's probably other ways. Maybe cash in a shipping container?

On the flip side, people _outside_ China want to move money in, and can't. So
they get Chinese companies to fake export receipts, pay for the export
(officially), then collect the cash from the Chinese company on the other
side.

~~~
gte910h
Bitcoin was a wonderful way to do that for awhile, still happening as well,
just less so.

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midas007
The regime doesn't respect private property rights (or human ones)
consistently, so it's obvious move for an owner and their family to move
somewhere that has a more functional legal system and a political class that
doesn't demand bribes. (Business in China is a full contact, adversarial
sport... even dealing with staff is a bigger hassle than elsewhere.)

The simplest question to ask oneself is: "In what kind of environment would
you like your kids to grow up?"

~~~
gbog
I don't know. For example many rich people flee France right now, and in some
respect it is also because of private property not being safe.

Kids: maybe I'm foolish, I want my kids to grow in China. The air is bad but
they will respect their teacher and elders, they will be able to safely walk
in any streets, they experience a fast changing and exciting environment, with
friendly and welcoming neighbors, and maybe most importantly they will be well
equipped mentally and culturally to understand the world all the kids of their
generation will have to live in.

All of that is obviously weighting much more than air considerations.

~~~
XorNot
No they're "fleeing" because of a 70% upper marginal tax bracket on person
income. And I question how many have actually left, as opposed to saying they
totally will.

I seriously doubt France will really miss them, since it's unlikely they paid
much of the previous bracket in the first place, and they won't very well stop
doing business there.

~~~
yodsanklai
"No they're "fleeing" because of a 70% upper marginal tax bracket on person
income"

Not quite true. "Beyond 500 000 euros in yearly revenue, the maximum tax rate
on the revenue is 49 %. The 75 % tax bracket was censored by the Conseil
constitutionnel, and is now paid by the companies." [1]

"And I question how many have actually left".

Apparently, it's no so clear.

"The idea that France is experiencing a massive tax exile is widespread in
some political circles and sometimes covered in the press, but there are
absolutely no tangible proof that such an exile is happening." [1]

[1] - [http://decodeurs.blog.lemonde.fr/2014/01/06/the-fall-of-
news...](http://decodeurs.blog.lemonde.fr/2014/01/06/the-fall-of-newsweek-
french-bashing-gone-wrong/)

~~~
marvin
I don't get this. If the 75% tax is paid by companies rather than individuals,
won't the individuals who own these companies _still_ effectively be taxed at
this rate? A $1 million tax is a $1 million tax regardlss of whether it is
applied when the money hits the company' bottom line or when it hits the
owners' bank accounts.

~~~
yodsanklai
My understanding is this particular tax on high salaries is paid by the
employer. Suppose you pay an employee more than 1 million euro yearly, you'll
have to pay about 75% tax for everything over 1 million euros. Apparently,
this only for 2013 and 2014 and it concerns about 1000 employees, including
something like 100 soccer players.

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flexie
Are the Chinese rich mostly (former) Communist elite members who succeeded on
grabbing assets during privatizations or are many of them self made
entrepreneurs?

~~~
patio11
Yes.

The more-content less-joking answer to this question involves things like
self-made entrepreneurs whose first dollar came from a $10 million dollar
contract from a factory owned by the Chinese army which, totally freakish
coincidence time, happens to be run by their dad.

The magic word for Googling about this is "princeling."

~~~
twelvechairs
"Princelings" are the children of the high ranking communist party members. As
they have huge political influence they are probably the polar opposite of
what is being described in this article - they are unlikely to leave because
they are benefiting from the system not worried about being bitten by it.

~~~
SiVal
On the contrary, communist officials know better than anyone how arbitrary
power based on political connections can be and many are buying homes in the
US in preparation for any sudden changes in their status. Many of these
princelings have prepared escape routes in case the tide turns against them.

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leoc
And so it begins, possibly. China has a very big economic adjustment ahead of
it; this may well be a sign that the long-delayed change has begun, or is
about to begin, in earnest. (I'll refrain from any nautical metaphors here.)
All those complacent expectations of the next five years or so of the world
economy seem to depend on things being mostly okay in China. I suppose we'll
see how that works out.

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ck2
I'm kind of surprised China allows the money to leave.

But with the air so toxic I don't blame them.

Of course if they are coming to the US, they best avoid the water.

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adventured
The water? America has extraordinarily clean water systems overall, among the
best in the world in fact. It also has one of the highest renewable water
foundations (trailing only Brazil, Russian and Canada). It's also very
diverse, some cities are much better than others. The notion that a person
moving from China to America would worry about the water is borderline
comical.

Most of America's cities have an overly abundant supply of clean drinking
water. Those that don't are almost always situated in a desert.

~~~
AaronIG
I'm pretty sure that statement was tongue-in-cheek, given the recent water
woes in West Virginia.

~~~
ck2
Not just West Virginia, lots and lots of places because the infastructure is
wearing out and regulations either don't exist or are being ignored.

Anywhere there is gas mining, Hawaii, etc.

[https://www.google.com/search?q=water+pollution+-virginia&tb...](https://www.google.com/search?q=water+pollution+-virginia&tbm=nws)

Just because it doesn't make national news, doesn't mean something really bad
isn't happening, there is a ton of gun violence in Chicago every week and the
national news ignores is.

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0grr
ahh yes, one of those china stories where only bad news is the politically
correct / accepted news.

[http://www.economist.com/news/finance-and-
economics/21594345...](http://www.economist.com/news/finance-and-
economics/21594345-despite-strict-currency-controls-money-finding-its-way-
china-hot-and)

~~~
seanmcdirmid
As opposed to within China where only good news is politically correct.

[http://www.chinadaily.com.cn/china/](http://www.chinadaily.com.cn/china/)

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gotofritz
The rich have always been above the concept of nation from at least when
Florence and Genoa began to decline in the renaissance abd the rich Italians
emigrated to France

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dominotw
Officials with spouses overseas won't be promoted
[http://www.chinadaily.com.cn/china/2014-01/17/content_172403...](http://www.chinadaily.com.cn/china/2014-01/17/content_17240314.htm)

