Chapter 14 The first section uses data to tell history

To understand the historical changes of China over 2,000 years since AD ​​1, the key is to look at the width of the perspective.According to the method of dividing history according to Fairbank’s 20-year period, at least 100 books should be used to interpret this period of history.However, Huang Renyu provided a brand-new historical perspective with his unique view of big history.In the preface of a book, he said: "Because my so-called 'macro-history' (macro-history) concept must be international, I very much hope that with the spirit of being home in the world, we can enhance the understanding between the East and the West and eliminate prejudices. .This is not a simple matter. Even overseas, it is still a topic that is prone to right and wrong. The first thing to explain is that the big historical view cannot be seen in books alone. Especially not only personal intelligence Wisdom can be learned and acquired. My experience is reflected in traveling around for decades, hearing different explanations, and then because of the torture and imitation of life. When I was a child, I was very influenced by Ma Qian of Taishi Company. My head is full of legendary hopes and ideas. Only when I enlarge my vision more and more can I realize that my personal ability is limited, and the true meaning of life must be obtained in history, and the laws of history sometimes cannot be seen clearly in a short period of time , and you need to open your eyes for a long time to see it."

Huang Renyu pointed out that the problems that have occurred in China for thousands of years are all "lack of numerical management".He is very concerned about the financial situation, and believes that the central government is mainly maintained by the tax system. If the tax revenue drops sharply, the operation of the government cannot be maintained.According to Huang Renyu's analysis, the central government lost control of the local government starting from the Eastern Han Dynasty. The main reason was that the central tax base, which relied on local governments, was destroyed, and it was not re-established until the Tang Dynasty. After that, no effective tax system was established. In the event, due to financial difficulties, there are always more losses than wins.It makes sense for Huang Renyu to look at the problem from a tax perspective.But fiscal expenditures are also very important. A central government can often control expenditures at the beginning, but cannot control them later.Similar to the effect of tax reduction, the increase in fiscal expenditure will also erode the country's fiscal surplus. Once internal and external troubles occur, there will be no money to deal with them.

For example, at the end of Wanli in the Ming Dynasty, the Ming Dynasty began to take seriously the serious situation of the rise of Nurhachi outside the customs, and invested 400,000 troops to deal with Nurhachi's 100,000 elite soldiers of the Eight Banners.The use of this troop scale should be judged accurately.However, the treasury of the Ming Dynasty was empty and could not afford the cost of a long-term battle of 400,000 troops.Therefore, on the one hand, the Ming Dynasty was forced to levy additional land taxes, that is, the "Liao pay" that caused national complaints;In the spring of the forty-seventh year of Wanli (1619), the main general Yang Gao sent troops in four directions, taking risks and advancing aggressively, and suffered a crushing defeat in the Battle of Sarhu.From then on, the Ming Dynasty had to enter the stage of strategic defense outside the pass.Even if Emperor Chongzhen killed Yuan Chonghuan and Wu Sangui did not join the Qing Dynasty, it would be difficult for the Ming Dynasty to cope with the rise of the Qing Dynasty due to its own financial difficulties.It should be said that from the Qin Dynasty to the end of the Qing Dynasty, China's feudal dynasties changed every 200 to 300 years, which was directly related to the financial situation.

Huang Renyu's fiscal view is exactly the same as that of Yale University historian Paul Kennedy.Kennedy believed in his book "The Rise and Fall of Great Powers", which is popular all over the world, that in the pre-industrial era, the fiscal and financial system did play an important role in the decline and decline of a country's strength.The Roman Empire, which was at the same time as the Han Dynasty, went through about two and a half centuries, constantly conquering east and west, and established an empire across the Eurasian continent.But the Roman Empire did not establish a great country, only a great army, and a great army needs strong financial backing.Kennedy believed that with the expansion of the territory of the Roman Empire, the expenditure of the army was also increasing, which increased the financial burden. In the absence of debt issuance, the only way to increase the tax burden and issue a large amount of currency was to hurt the enthusiasm of taxpayers. , leading to tax cuts, leading to financial crises and persistent inflation.

The financial crisis and continuous inflation led to a decline in the strength of the army, which eventually led to the collapse of the huge Roman Empire.In AD 1, the Western Han Dynasty was facing the same financial crisis and high inflation as the Roman Empire.From AD 8 to AD 23, the "Wang Mang New Deal" that tried to save the economic crisis failed.As early as 326 BC, Alexander the Great was determined to conquer the easternmost part of the world, from west to east, to India, and finally conquered India, but he could only look at the snow-capped Himalayas and sigh.Due to the obstruction of the Himalayas, China's Han Dynasty army, which "offends the strong Han, will be punished even if it is far away", has no encounter with the disciplined Roman Empire Legion, so it is impossible to know which of the two prestigious countries is stronger, but there is one thing It is common: two once-great empires were defeated by their own financial and economic crises, and they fell to the ground with a bang, and collapsed in an instant, which is embarrassing.

Following the example of Mr. Huang Renyu, I am here to advocate the view of economic history.History is too complicated, and historians may have completely different views on the same event after being regrouped, so it is difficult for people to form a consensus.The big view of economic history is to use numbers as the realistic basis for understanding the real history, so as to find a clear and objective clue and draw a conclusion that can stand the test of time.For example, everyone knows that China is poor in modern times, but few people know how poor it really is. I discuss the great economic history from the perspective of a country's prosperity and its people's strength.Adam Smith wrote in the introduction to The Wealth of Nations: "As the branch of science that serves the statesman or legislator, political economy has two definite aims: first, it is to provide, or more properly In other words, to enable people to provide themselves with ample income or means of living; secondly, to provide the country or all citizens with sufficient financial resources to maintain public utilities. The purpose of political economy research is to make the country rich and the people rich.” Adam Smith The emphasized economics has two basic purposes, which are also applicable to the concept of economic history, and also have international universal significance: the first point is the issue of long-term economic growth, but it is not easy to increase per capita income in the long run; the second point is the public financial problem.This question is easily overlooked.The root cause of macroeconomic problems is often fiscal problems.For example, countries often experience financial difficulties, which may lead to debt crises or high inflation. In the case of a fixed exchange rate mechanism and an open capital account, the currency suffers speculative attacks and is forced to depreciate, which may lead to a currency crisis.

How to quantify "rich country and rich people"?Modern statistics already have a good answer. GDP is a concept of added value that is useful to people. It is the sum of the wealth created by an economy and reflects the economic strength of a country.GDP per capita reflects the wealth and living standards of the people.Comparing the GDP achieved in a country's accounting period (usually one year) with the resident population of the country is calculated to obtain the GDP per capita.Per capita GDP refers to the amount of wealth or economic added value created by each individual. It can be roughly used as an indicator of labor productivity and the closest indicator to measure per capita income.In this book, income per capita is GDP per capita.

According to the United Nations System of National Accounts (SNA), per capita income indicates the total domestic income per resident of a country, referred to as per capita income.However, when per capita income reflects the overall picture of national economic and social development, it cannot show all aspects of a country's residents' income status, and there are also defects.For example, it cannot indicate the distribution of the total wealth of a country among residents, cannot reflect whether work can provide people with a sense of happiness, and does not take into account the damage to the environment in the process of economic activities, such as the greenhouse effect caused by carbon dioxide emissions in the atmosphere. To, and so on.Nevertheless, per capita income is still the most statistically important achievement of human beings so far. Because it is highly correlated with other social indicators such as life expectancy and quality of life, it is infinite in the comprehensive evaluation of the economic development of a country or region. replaceable.Just like the examination system has many flaws, but it is difficult to find an alternative in ancient and modern China and abroad.

It should be explained first that the perspective of discussing China's economic development has always been the change of economic aggregate, but the economic aggregate tends to create a vicious cycle of "becoming proud before getting rich" internally, and falling into the trap of "China threat theory" externally.Internationally, "the 21st century will be China's century" is heard endlessly. It seems that China's becoming the world's largest economic power is a foregone conclusion.Although since 2002, my country's economy has achieved a growth rate of more than 9% for five consecutive years, and its economic aggregate has surpassed France, Britain, and Germany in the world for five consecutive years, ranking third. China has become the world's largest This is an indisputable fact.However, so far, China is the most populous country in the world, accounting for 1/5 of the world's total population. The 1.3 billion population is a basic starting point for China to consider social and economic development issues.

In 1956, Mao Zedong profoundly pointed out that the population base is the basic national condition. He said that we should start from the fact that our country has a population of 600 million when we make plans, handle affairs, and think about problems. We must not forget this point.At present, the most basic daily needs of China's 1.3 billion people are food, clothing and housing. Teenagers need education, adults need to work, and the elderly need to spend their old age in peace.Food, clothing, housing, education, work and pensions can all be classified as economic issues.On the other hand, China's huge population base has brought enormous pressure on resources.It is a well-known fact that China feeds more than 20% of the world's population with 7% of the world's arable land.GDP per capita can easily keep one's head clear when making international comparisons.Once divided by the total population, China's per capita GDP still ranks at the bottom, which shows that the valuable social wealth created by China's per capita and the social wealth that may be used for distribution are far behind most countries in the world.It is an indisputable fact that Chinese people grow old before they get rich, and the financial burden will increase in the future.

GDP per capita measures the degree of social welfare from the perspective of ordinary people, highlighting the people-oriented scientific development concept.Without the prosperity of everyone, there will be no prosperity of the family, and there will be no prosperity of the country.Mencius said: "People have a constant saying, and they all say: 'The country under heaven'. The foundation of the world is in the country, the foundation of the country is in the family, and the foundation of the family is in the body." The more wealth created and owned by everyone, the wealth owned by the family will naturally be more As a result, national taxation will also increase accordingly, and there will be more room for "taking from the people and using it for the people". My view of economic grand history is to evaluate the past and predict the future in a two-dimensional world.The first dimension is time.Under the coordinates of time, we go back to the past, from 2009 AD to 1 AD when per capita GDP data is available; we look forward to the future, from 2009 to 2049, and predict the next 40 years from the year of the Republic of Jiazi to the centenary. year.In other words, the time span is more than 2,000 years from 1 AD to 2049 AD.The second dimension is per capita income (per capita GDP), which is a clue that can run through China in 2000, and it runs through the changes in the average living standard of the people.Without quantitative indicators, it is difficult to make objective comparisons, and it is easy to get lost in the complicated historical details.In a two-dimensional world of time and per capita income, how much worse did our grandparents enjoy a standard of living than we do today?How much better will our children and grandchildren be able to live than us?In this two-dimensional world, the economic rationale behind simple curves is complex.Until today, neoclassical economics has not been able to give a satisfactory answer.What are the factors behind changes in long-run per capita income?I adopt the applied economics method of the International Monetary Fund, that is, there must be an economic story behind every number, and the economic story must be supported by numbers, and apply new economic thinking to provide a reasonable estimate for China's economic growth from 1 AD to 2049 explanation of. I try to quantify the economic analysis and forecast in this book as much as possible, and use numbers to force myself to limit my sensibility, add rational components, and overcome possible deviations in intuition.Angus Maddison has done pioneering work in this area. The book "A Millennium History of the World Economy" published in 2001 and the book "The Long-term Performance of China's Economy (960-2030 AD)" published in 2008 are This book lays the foundation for data. For the data before 1970, I use the data of Angus Maddison as the standard. It should be noted that Angus Maddison uses international dollars. For the data after 1970, I refer to the World Bank and the International Monetary Fund.The International Monetary Fund publishes the "World Economic Outlook Report" every six months, which has the per capita GDP data of most countries in the world. At the same time, the macroeconomic view of history must facilitate international comparisons.The World Bank uses per capita gross national income to compare and evaluate the economic capabilities of various economies, and believes that gross national income is the best single indicator to measure a country's economic capabilities and economic progress.Based on gross national income per capita, the World Bank classifies economies as low-income, middle-income (broken down into lower-middle-income and upper-middle-income), and high-income countries.Regardless of what country you are studying, just look at the per capita income of this country and you will know that it is almost inseparable, because people's lifestyle and mental state are directly related to per capita income.I have been to many countries in the world, and I am used to observing the living conditions of human beings from the perspective of an economic worker. Using per capita income to compare horizontally, I have a deeper experience in this issue.I found that ordinary people in a country with a per capita income of 200 dollars think about survival; ordinary people in a country with a per capita income of 3,000 dollars think about the comfortable life of "a little rich is safe"; ordinary people in a country with a per capita income of 10,000 dollars think Leisure life, that is, Veblen's "leisure class"; a country with a per capita income of $30,000 has entered what Galbraith called an "affluent society", and residents are beginning to plan vacations around the world.When I was abroad, foreigners were confused when they heard that China was going to realize the "great rejuvenation of the Chinese nation" in 2049, and then asked, what does "the great rejuvenation of the Chinese nation" mean?But when you hear that China is going to complete the restoration of the relative level of per capita income in the forefront of the world, you will understand. Considering the changes in China in the past 30 years, it can be described as huge. In the early 1980s, waste paper and sundries could be seen everywhere on the streets of most cities in China.Why is it suddenly gone now?Of course, there are many reasons for this, such as the improvement of people's moral standards and the strengthening of urban management, but fundamentally, the increase in per capita income has changed people's behavior. When I went abroad in 1995, there were still very few Chinese-language information on foreign attractions; before I returned to China in 2005, Chinese introductions to foreign attractions were already very common.It shows that the per capita income in some areas of China is already quite high, and traveling abroad has become a way of life. The grand view of economic history also requires vertical comparison.As a part of the world economy, China's improvement of living standards and improvement of welfare is worldwide.In the first 30 years since the founding of the People's Republic of China, the life of the Chinese people has been initially improved, they have gotten rid of extreme poverty, and basically achieved a life of food and clothing.This progress is quantified by per capita GDP, that is, from 100 US dollars per capita to 300 US dollars per capita.In the second 30 years since the founding of the People's Republic of China, the lives of 1.3 billion people in China have been greatly improved and 200 million people have been lifted out of absolute poverty. progress.This progress is from $300 per capita to $3,000 per capita. Economic development cannot surpass the development stage of per capita income, and it must move forward steadily.A small difference in development speed is nothing in the short term, but in the long run, it will make a huge difference, and there is a feeling that "a slight mistake can make a thousand miles away". Krugman, winner of the 2008 Nobel Prize in Economics, said, "The growth rate of labor productivity per capita is nothing in the short run, but everything in the long run."Growth in per capita income follows what is known in finance as the "Rule of 72," which is used to estimate the time it takes to double or halve an investment, reflecting the effect of compound interest.When using this law to calculate the time required, divide the number corresponding to the law applied by the expected growth rate.For example: Assuming that the initial per capita income is 2,000 US dollars, assuming zero population growth, and an annual economic growth rate of 9%, use the "Rule of 72" to divide 72 by 9 (growth rate) to get 8, which means about 8 years, and the per capita income Roll over to $4000 (twice $2000).If the average growth rate is 10%, using the "rule of 72", it means that per capita income will double in 7 years.

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