The chief executive’s new Policy Address is rich in proposals to address Hong Kong’s acute housing woes. (DALE DE LA REY / AFP)

As widely expected, Chief Executive Carrie Lam Cheng Yuet-ngor’s third Policy Address was rich in proposals to address Hong Kong’s acute housing woes, and help needy families and the elderly. Undoubtedly, it’ll be roundly applauded for the long list of sweeteners that may soften the stance of many of the moderate anti-government protesters.

But the relief measures that were unveiled, though timely and effective, have skirted around the core social and economic problems that have given rise to boiling public discontent, which has exploded so violently in the four-month-long civil unrest. These tumultuous times are a wake-up call to the government and the dominating business sector that fundamental changes are needed to put things right.

Social injustice is not unique to Hong Kong. Many other developed economies, including the United States, the UK and some European countries, are also troubled by widening income gaps and massive losses of middle-class jobs.

Hong Kong’s problems have been exacerbated by the city’s extremely narrow-based economy and the government’s hands-off economic policy. The accolades of the world’s freest economy are considered by its citizens more as a stigma than as a badge of honor.

Many Hong Kong people, especially those of the “sandwiched class”, who are excluded from government subsidies while earning too little to make ends meet, believe that the free market economy has failed them. Younger people who got stuck in low-paying service-sector jobs with little prospect for promotion are losing hope for the future.

Civic leaders and economists have blamed the loss of opportunities to move up the social and economic ladder for the protracted violent protests by young radicals. But few of them have the stomach to call for radical change for fear of unraveling the long-cherished free market economy. 

The hugely influential business sector, dominated by property-based conglomerates and mostly family-owned, still adhere to the belief that maximizing earnings is part of their inalienable right. They are not alone.

Many employers, big and small, have fought tooth and nail against any government plan to give workers a better deal. The business lobbyists invariably argue, like a broken record, that the increased costs of workers’ benefits would drive many small to medium-sized enterprises into the ground, although they have been proved wrong more than once.

Indeed, government handouts, no matter how generous they may be, are just a stopgap measure. The only way to ensure peace and order in society is to take bold steps to upend the economic fundamentals.