What's the Deal with Hong Kong?

As you may remember, Hong Kong, a British enclave since the first Opium War of the 1840s, reverted to the People's Republic of China in 1997 with much pomp and circumstance.

But was did that actually mean? Today, Hong Kong is a "Special Administrative Region" of the PRC. Under this arrangement, the city-state has 50 years of semi-autonomy following the transfer of sovereignty. In practical effects, this means Hong Kong SAR runs its own immigration and naturalization services, maintains its own currency, and retains its Common Law heritage for the time being. As I've seen on the street, there's clearly a sense that the concepts of free speech, assembly, and general protest have their place as legitimate part of society here.  There's still a good dose of ex-pat in the city, although Chinese Hong Kong people predominate in the local population.

It's been interesting for me to try to discern the precise nature of Chinese influence and control on the ground - ostensibly the PRC only has foreign affairs and defense prerogatives with respect to Hong Kong SAR.  Tangibly, there's the hulking People's Liberation Army barracks building - that looks like an giant, ugly, concrete dreidel - occupying some prime real estate near the harbor.  But locals tell me the soldiers themselves "never come out" - not even during the many protests in Hong Kong, like the recent one on the anniversary of Tiannanmen.

Supposedly, there's also a PRC naval facility on Stonecutter's Island across the harbor, but I've only seen one vaguely military vessel in the waters during my time here, and it was quite tiny, probably a coastal patrol boat at best.

Locals here seem to agree that Hong Kong people may not see the direct effects of Beijing, but they self-censor in anticipation of Beijing, almost unknowingly.  And there's a widespread suspicion that the Lord Mayor and other trappings of the colonial administration left intact are a rather hollow pretense when it comes to actual governance and decision-making.

I'll keep an eye out and my ears open - it's an interesting dynamic.

ADDED:  Here's a great reference outlining the specifics of the relationship between Hong Kong's "The Basic Law" and the PRC.