The Emigration of Wealthy Chinese Is an American Conspiracy

In 2010, the United States approved more than 4,200 immigrants worldwide, among which 70 percent come from mainland China. In the wave of wealthy Chinese immigrants, a large amount of Chinese private capital has flocked to the U.S.

China should transform itself from being just a big economic power into a livable big country in order not to lose both talent and money in the context of globalization.

As long as local law permits, China’s wealthy people seem to be able to buy houses in the U.S. This is not bragging, but China’s rich are continually forming house-buying groups in the U.S., chartering flights to every big city in the U.S., making locals exclaim whenever they go. In Beijing, compared to the deserted scene in many housing sales offices, one after another overseas house-buying consulting sites are unusually hot. A company named Gao Li International continuously publishes large ads in many financial and airline magazines, selling villas or apartments in big cities in the U.S. including New York, Washington, Boston, Los Angeles, etc.

An agency in China estimated that the investment fund squeezed from the recent new regulation to control the property market was over 400 billion RMB. How much of this fund went to America’s property market still cannot be counted. A person who’s back from purchasing a house in the U.S. expressed that his house in Texas is worth $450,000, which can only buy an apartment of 100 square meters in the fifth ring in Beijing. In the U.S., the ratio of individual house prices and individual income levels is only four, which is much lower than that in China. Some people think that the reversed performance price ratio in China is an important reason for the overseas house-buying of wealthy Chinese.

Of course, this is only half right. In fact, the immigration of wealthy Chinese to the U.S. has become a trend. This April, the 2011 China Private Wealth Report released by China Merchants Bank showed that about 60 percent of “high net worth individuals” in China — people with over 10 million RMB in assets — either considered investment immigration or have almost completed their immigration procedure. Among those billionaires, about 27 percent of them have completed investment immigration. The survey result indicated that among people who own 100 million RMB, about 27 percent have completed emigration and 47 percent are considering leaving China.

Apart from that, another important factor for the phenomenon is that America has lowered the migration threshold greatly to absorb wealthy Chinese. One is that the application threshold has been lowered from $1 million to $500,000. With respect to the difficulty of application, the criteria for U.S. investment immigration only require that the private assets are “legally obtained,” and do not insist that the assets be earned from business.

Second, in December 2010, the Startup Visa Bill that helps foreign entrepreneurs come to the U.S., proposed by Democratic Senator John Kerry and Republican Senator Richard Lugar, has won bipartisan support and will be passed before long. This bill advocates the establishment of a “startup visa”; as long as foreign entrepreneurs can raise $100,000 or obtain a total of $250,000 in equity financing to set up a company in the U.S., they can get a green card.

The change in those policies is perceived as the only immigration method that is faster than marrying a U.S. citizen. Little wonder after the new policy been put forward, wealthy Chinese people were so happy, as if they found buried treasure, and the related immigration organizations were filled with rich Chinese. Over the past year, the number of rich Chinese who migrated to the U.S. increased; in 2010, the U.S. approved the entry of 4,200 immigrants worldwide, among which about 70 percent come from mainland China.

Analysts think that America’s absorption of rich Chinese is nothing less than the initiation of an invisible financial war against China. In the past, the U.S. “robbed” Japan, South Korea and wealthy Middle Eastern countries, but now it has targeted China and laid out a big plot. On the one hand, to contain the Chinese government’s large foreign exchange reserves, the U.S. has been pushing China to buy U.S. Treasury bonds instead. As of this March, China holds $1.1449 trillion in U.S. Treasury bonds. On the other hand, another breach has been opened against Chinese private wealth, absorbing the migration of rich Chinese individuals to the U.S.

The surprising result is that the large private capital flow from China to the U.S. is consistent with the monitoring report of illegal money flow published by the U.S. Treasury Department. From the summer of 2010, the amount of cash transferred secretly out of China has increased greatly. According to the non-profit organization Global Financial Integrity, China’s illegal funds transfer flows are second to none in the world. Between the year 2000 and 2009, the outflow of funds from China was up to $2.18 trillion. In other words, if calculating based on the large population in China on average, this outflow reached $1,600 per person.

If the situation goes on, it will be very unfavorable to China. Not long ago, a report expressed thoughts on the new wave of immigration to the U.S. — “Calmly Examining Immigration: Why immigrate? How much is its impact on China?” This article directly pointed out that China’s wealthy class and intellectual elite were becoming the main force behind the new immigration wave. As to whether the immigration heat would cause a large scale outflow of talent and capital, the article held that China should move from just being a great economic power to transform itself into a livable country, which would prevent it from being a net exporter of talent and capital, in the context of globalization.

Looking back, the U.S. has been truly welcoming toward rich Chinese immigrants. Whether it’s an American conspiracy or overt scheme is self-evident. A conspiracy is always full of mystery. Many people think that sucking in rich Chinese is the product of an American conspiracy. In other words, by adjusting policy, America attracts rich Chinese to immigrate to the U.S., further absorbing all the wealth in China. This is a powerful tool wielded by the U.S. to contend with China.