Spatial liminality as moral hazard and boat squatter toleration in post-World War Two Hong Kong

•The paper uses of colonial government memoranda to uncover moral hazard logic.•Hong Kong colonial government development policies in part created the boat squatter problem.•Moral hazard logic explains denying boat squatter access to public housing.•Perceived spatial liminality of typhoon shelters invokes moral hazard logic.•The study reflects neoliberal indifference to the housing needs of a marginalized population.

This research critiques the concept of moral hazard to explain boat squatter toleration by the post-World War II Hong Kong colonial government. The normative nature of moral hazard discourse in neoliberal policy and practice is examined through the use of archived colonial administrative memoranda as a form of ethnography. Perceiving spatial mobility of boat squatters occupying the liminal space of typhoon shelters over which the government did not possess complete jurisdictional control evoked a host of situational moral hazard truth claims to exclude them from public housing. Conflicting narratives of government actors in administrative memoranda provide evidence of the dubious use of moral hazard logic to justify neoliberal government indifference to the housing needs of a marginalized population.