China Now Has More Billionaires Than the United States

China Now Has More BillionairesChina Dethrones U.S. as World’s Billionaire Capital

China, which continues to call itself a communist country, boasts more billionaires than the United States, the country where one of its presidential candidates (Bernie Sanders, for the record) is attacked for not being capitalist enough.

A ranking of China’s wealthiest published Thursday by Rupert Hoogwerf, also known by his Chinese namesake as Hurun, said that “Despite the slowdown in the economy, China’s richest have defied gravity, recording their best year ever, and creating more wealth than any country has ever done before in a year.” (Source: “Hurun Rich List 2015,” Hurun Institute, October 15, 2015.)

Alibaba Group Holding Limited (NASDAQ:BABA) founder Wang Jianlin unsurprisingly leads China’s billionaire pack in this veritable turning of the tables that sees the so-called communists leading the capitalists in wealth accumulation and creation. In 2015, China has surpassed the United States in the number of resident billionaires.

Of course, this is news only for those who are unfamiliar with China’s rise, as reported in Hurun Report, which specializes in covering luxury items and glamorous lifestyles. Hurun claims China is home to 596 billionaires (based in U.S. dollars), or 242 more than last year.

The United States can only claim 537 people whose net worth is larger than many countries’ annual gross domestic product. However, the Chinese billionaires are more “equitable” and do not reach the wealth peaks of their American counterparts.

Ironically, if the billionaires were mountains, the Americans would be the Himalayas and the Chinese would be the Rockies, stretching out longer but with lower summits with Wang Jianlin holding the position of Mt. Elbert at $34.4 billion.

The richest Chinese billionaire is a real estate and entertainment magnate, as well as the founder and former head of the e-commerce giant Alibaba. Western circles best know him as a prolific buyer of assets, including a stake in the Spanish football (soccer, that is, for the uninitiated) club Atletico Madrid.

Alibaba seems to be the common denominator of the top two individual fortunes in China, as the company’s current chairman Ma Yun holds the number-two spot. His fortune has dropped considerably from last year, given the collapse of Alibaba stock, but he can still take comfort in the warmth of his $22.7-billion nest egg.

The third-richest man in the “Middle Kingdom,” or “Zhongguo” in Chinese, is entrepreneur Zong Qinghou, noted for his beverage business and a $21.0-billion fortune. Pony Ma, founder of Internet giant Tencent and operator of the popular app “Wechat,” follows in fourth place with 19 billion ever-gracious U.S. dollars. The fifth richest, for those who are counting, is Lei Jun, who heads Xiaomi, the company challenging Apple for smartphone dominance in China. He doubled his money in 2015, reaching a respectable net worth of $14.0 billion.

Not Just Billionaires: China Has Over a Million Millionaires

As the number of billionaires increases, so does the number of millionaires; indeed, there are over a million Chinese citizens with more than $1.0 million at their disposal. Most are under 35 years old are not only fueling consumption, but they are also revolutionizing the very culture of the second-largest economy in the world.

In the West, stratospheric wealth is the prerogative of “seniors,” or those aged 50 and over (especially in Europe); whereas in China, the plutocrats are often very young people who have amassed their fortunes in a matter of months, rather than years. They are modern-day mandarins; they love capitalism and Western consumerism and they are the ones who will lead the companies and the state party–ruled superpower, which could surpass the United States before the middle of this century.

A UBS report shows that in China, in the first quarter of 2015, a young man, starting from poverty, became a millionaire every week. (Source: “UBS and PwC’s 2015 Billionaires Report Examines Trends in Extreme Wealth,” UBS, May 26, 2015.) The study suggests that within a period of 10 years, starting in 2005, China has started to change from the People’s Republic of China to the Millionaires’ Republic of China as billionaires increased from zero to more than 560, taking over the United States.

Who Are the New Chinese Super-Rich?

The new super-rich or plutocrat class of millennials (all born between 1980 and 2000) is achieving nothing short of a revolution in China, or an “anti-revolution,” if you will, without mass mobilization and tanks in Tiananmen Square, as in 1989. Rather than tanks, young Chinese people want to be seen using social media on the latest smartphone, driving the biggest SUV or luxury car, and taking holidays to exotic destinations such as Antarctica and glamorous cities like Paris, London, and Rome.

The percentage of billionaires and millionaires, in relation to a population of 1.3 billion people, perhaps diminishes the effects of the phenomenon; however, the pace of wealth accumulation is faster than anywhere and that gap is closing. China, the country of the Maoist Cultural Revolution, where even listening to the music of Beethoven was a rebellious and punishable act and where the accumulation of any capital was abolished, is breeding more millionaires by the week.

China’s wealth phenomenon is unprecedented in the modern era and it is not only changing society, it threatens to destabilize China. It has already revolutionized the global luxury market. The new millionaires enjoy spending “to live better now,” rather than save. They like technology, finance, and social media.

China is shedding socialism and factories full of workers, replacing it with capitalism and hi-tech applications based on robots. When it comes to luxury, the cultural shift becomes evident, considering that “tuhao,” a term once used to describe the old imperial landowners targeted by the Communist Revolution, has now reclaimed favor to identify the new young collectors of Swiss watches and European luxury cars.

Only one in four of the youth magnates has a university degree and none marries before the age of 35. They live in major cities and speak English. They’re obsessed with enjoying life for as long as possible. After they buy a house in their city of residence, they look for property abroad, better if in Europe or the United States.

They like watches, jewels, cars, and high fashion, but they also want to travel. Over 100 million Chinese have made a holiday abroad. Last year, Chinese tourists exceeded Americans for money spent for vacation in a foreign country. By 2020, more than 200 million young Chinese travelers will be enjoying two or more vacations abroad per year.

Tour operators will have to adjust their conception of the Chinese tourist to address the needs of a new generation of young, single, rich, educated, and spendthrift millionaires, who will easily be sparing several thousand dollars for shopping.

Chinese families now like to take their children to visit luxurious neighborhoods during weekends, to see the villas, yachts, and cars of the new millionaires. The new materialism is being taught with more dedication and conviction than socialist ideals during the Cultural Revolution.