Why Steve Wynn should—and shouldn’t—fear China
Wed, May 12, 2010 (3:30 p.m.)
Photo: Kin Cheung/AP
The Las Vegas media lately has spent a whole bunch of ink and digital space attacking and analyzing Steve Wynn’s suggestion that he might move his corporate headquarters to China. Much of that has been appropriate, but again and again writers go for the cheap shot—claiming irony in the notion that a capitalist like Wynn believes he can find safe harbor among “communists”—without understanding how geopolitically incorrect they’re being.
I know a thing or two about this. I lived and covered the Middle Kingdom for two years, I went back to cover the SARS outbreak, the opening of Sands Macau and the opening of Wynn Macau. I even attended a rave on the Great Wall in 2001 the night before then-Chinese president Jiang Zemin celebrated the 80th anniversary of “communism.”
So here’s the deal: Yes, the ruling group in China is known as the Communist Party. But no, China has not been a little-C communist nation for decades now. There is no wealth distribution to the masses, the state has increasingly ceded control over major industries to private or publicly traded interests and, best of all, not everyone is a comrade. In fact, only about 5.6 percent of the nation’s population are members of the Communist Party.
China today is more akin to a gigantic corporation I’ve for 10 years been calling PRC Inc. The CPC is the board of this, the world’s largest company, setting the rules and, no doubt, reaping an untold and unaccounted-for fortune from its operations. As would be the case in the U.S. if Wall Street and major manufacturers really had their way, China today offers unrestrained capitalism of the sort we saw in late-1800s America, before the existence of labor unions, antitrust laws and other restrictions on the free market. There’s little in the way of environmental law, work-safety legislation, even proper jurisprudence to adjudicate civil disputes or protect the rights of crime suspects the way we understand it. It’s the Wild, Wild East.
Wynn should certainly be wary of placing too much faith in the Chinese government, but not because it’s communist in the sense that one day PRC Inc. will seize his land and run his casinos. No, he should worry because this is a brutal totalitarian regime that continues to exert an intense amount of control over its citizens. Occasionally, it’s in a paternalistic manner—restricting Macau visas to slow the gambling losses—and usually it’s by doing horrific things such as overpopulating Tibet or the Muslim stronghold of Xinjiang with Han Chinese in an attempt to swarm a region and scrub it of its natives in ways that make Israel’s West Bank settlements look like Lincoln Logs. I once interviewed the survivors of an executed prisoner who hadn’t had anything resembling a fair trial; after he was executed, doctors harvested the transplantable organs without anyone’s consent and returned a disemboweled corpse to the family.
Journalists—and Wynn shareholders—need to get this straight. It’s not incorrect that Wynn is playing with fire. It’s not wrong to question Wynn’s motives and even his patriotism; he could open a large regional office without a kerfuffle. He’s not the first American entrepreneur to discover a robust marketplace abroad or, specifically, in China, but even as Proctor & Gamble sells more soap there than in the U.S., they don’t talk about relocating or reconstituting their company. They’re proud of their American roots, as Steve Wynn should be.
Yet Wynn opted instead to use this moment to suggest a total corporate reformation simply to poke a finger in the eye of a president who had nothing to do with the overbuilding of Las Vegas. And that’s the truth: Wynn’s pissed because there’s nothing grand for him to do in Vegas in the foreseeable future. That’s all. He doesn’t like Obama, he’s mad that his beautiful resorts are affordable to spring-breakers and, yes, he’s making a lot more money over there.
Both Wynn and Sheldon Adelson have made references to Chinese citizens having a good, free life, and they’re either delusional or sucking up to the Party. Some Chinese do (those who have partaken in the bounty have had their loyalties bought), but even though China has more than 100 cities with more than 1 million residents, the vast majority of this nation are impoverished rural-dwellers using primitive equipment.
Americans gasp when a dozen or so miners get trapped and die in West Virginia; in China, as many as 4,000 miners perish in mine disasters every year. That’s nearly 11 a day! When the government decided to dam the Yangtze River, they displaced 21 million Chinese from their ancestral homes. With no Internet or liberated media, there was no way for those millions of people to know how big a group they were a part of, no way to speak up. If any of these things happened in the United States, I would hope Wynn and Adelson would be as horrified as everyone else. Then, Wynn would really know what it’s like to endure an actual dictatorship and not the wussy one he believes Obama represents.
So, again, China is ruled by dictators with a terrific public-relations team, not by anything remotely resembling a communist philosophy. And Wynn and Adelson are cool with that, so long as that cuddly dragon doesn’t puff its fire their way. Steve Wynn is a charming man who believes that charm and buckets of money can always win the day.
We’ll find out sooner or later, but in the meantime there’s going to have to be a lot more reporting done on this topic. I exhort my colleagues not to go for the easy snark; it’s far more complex than that and the public deserves a more nuanced understanding of what’s happening.
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