Evergrande Shows the Risks Lurking in China’s Drive for ‘Common Prosperity’

In the past few months, China has been pushing for “common prosperity,” which means reducing income inequality and reining in billionaires. Instead of shareholder capitalism, China is talking up stakeholder capitalism, where customers, employees, and even local governments have a say in how companies do business and distribute their earnings.

Before President Xi Jinping woke the nation to its socialist roots, one billionaire was already talking about and acting on them. That man was Hui Ka Yan, founder of China Evergrande Group—the world’s most indebted real estate developer, now on the brink of collapse. Hui, a party member for more than 35 years, used the “common prosperity” slogan in a 2018 speech. For years he was ranked as China’s most charitable person, donating billions of dollars to good causes such as medical research.