Chapter 5 Chapter Four Economic Trends: Painful and Happy

It has become a consensus that 2009 was the most difficult year. In 2009, China's economy had fallen into a trough. Under such circumstances, the private economy also had serious problems.How do we judge the next step of China's economy? Liu Wei: 2009 is a critical year for all countries in the world to jointly deal with the global financial crisis. The Chinese government has also adopted a series of macroeconomic measures in response to this crisis.To be sure, these measures have had some effect. The data for the second quarter of 2009 showed that the economic growth rate was 79%, which stopped the continuous downward trend of the Chinese economy in the past 15 months.Looking back at the first quarter of 2008, China’s economic growth rate was 106%, a drop of 26 percentage points compared to 13% in 2007; the second quarter was 101%; the third quarter was 9%; It was 68% in the fourth quarter, falling below 7%, which is very rare!Next to the first quarter of 2009, the economic growth rate was 61%, which was even lower.As a result, the Chinese economy has plummeted for 15 months.In the second quarter of 2009, it rose to 79%, which stopped the downward trend from the data.This is directly related to the central government's package of fiscal and monetary policies, as well as the measures taken by governments around the world to deal with the crisis.

You can make a short-term and mid-term judgment. The short-term is 2009, and the mid-term is the next two to three years.Among them, 2009 may be the most difficult year in the past 30 years of reform and opening up.From the data, it looks like this: the economic growth is "guaranteed 8", but it was 9% in 2008; the unemployment rate is trying to be controlled at 45% in 2009, but the registered urban unemployment rate in 2008 is 42%.In addition, judging from the 2009 finances, including the central and local governments, most of the fiscal revenues from January to August were negative and slowed down; from the perspective of corporate profits, the state-owned enterprise profits just announced by the State-owned Assets Supervision and Administration Commission in 2009 generally showed decline; private enterprises are not only a problem of declining profits, but also have problems with their cash flow, especially the survival of small and medium-sized enterprises.In short, we should comprehensively study and judge the next step of China's economy from the perspectives of micro-level enterprise conditions, government finances at all levels, society's macro-registered unemployment rate, and economic growth rate, in order to achieve a targeted goal.The current loose monetary policy has led to a surge in credit, which has raised concerns among economists about the risk of inflation.I think it should be viewed from another perspective, that is, the level of inflation. In 2009, it is likely to be under the warning line of "deflation".Because the prices in the first half of the year, whether it is PPI or CPI, the ex-factory prices of industrial products and consumer goods, have all experienced negative growth compared with last year.

In 2009, we have little problem in achieving the goal of "moderate inflation", that is, the inflation rate is below 5%.However, we may fall below the deflation warning line (2%) in 2009. Considering the statistical error, if the price increase level is below 2%, it will be deemed as deflation.Therefore, 2009 may be the critical state of the deflation warning line.Deflation is more terrifying and harder to manage than inflation.In fact, 2008 has proved to be the most difficult and complicated year since the reform and opening up 30 years ago.At the beginning, Premier Wen made this assertion during the "two sessions". At that time, people still had different views: the economic situation was so good in 2007, so where is the difficulty in 2008?After one year in 2008, it proved that Premier Wen's conclusions during the "two sessions" were correct, and it also proved that people's views at that time were misjudged.Various contradictions, including international, domestic, macroscopic, and microscopic contradictions, and various imbalances, including structural and aggregate imbalances, lead to the rapid change of our macroeconomic policies. never before.Because in early 2008, our main task is anti-inflation.At that time, we put forward the "two defenses": first, to prevent the economy from overheating from partial to overall overheating, and second, to prevent prices from rising from local to overall. The core is to prevent inflation, prevent overheating, and control aggregate demand.

In July of that year, the central government adjusted this policy because of the huge impact of the international financial crisis on China, which led to the suspension of production of export enterprises and processing enterprises along the coast, causing a large number of migrant workers to return home early.At this time, the central government proposed "one guarantee and one control", that is, to ensure growth and control the price level, so that the price was reduced from the primary control goal at the beginning of the year to a secondary goal.However, at the end of the year, the situation deteriorated further, and the central government adjusted its macro policies again, called "one guarantee (guaranteed growth), one expansion (expanding domestic demand), and one adjustment (adjustment of structure)".Maintaining growth and expanding domestic demand are short-term tasks, while structural adjustment is a long-term task.In the short term, it is an expansionary macro policy. In early 2008, it was a tightening control policy. After July to the end of the year, it became an expansionary macro policy. Within a year, there was a directional reversal. This is in the 30-year history of reform and opening up. There is no above.Therefore, in 2008, the complexity of contradictions, the speed of macro policy changes, the difficulty of making choices, the large decline in a series of economic indicators compared with the previous year, the impact of the international financial crisis, and the monthly economic straight line The rate of decline, etc., is unprecedented.But looking at it now, 2009 was worse than 2008, and it has become a consensus that 2009 was the most difficult year.

Although the central government's macro-control policies have shown results, the momentum of economic growth that stopped falling began to pick up in the second quarter, but this pick-up still cannot change the fact that 2009 was the most difficult year in general.This is my recent judgment. Is the Chinese economy at this stage anti-recession or anti-stagflation?To which stage of the crisis should the next two or three years belong?Will there be greater difficulties? Liu Wei: 2010, including 2011, is in the middle of the post-crisis era, that is, during the completion of the "Eleventh Five-Year Plan". I don't think it will be more difficult, but I am afraid it will be more difficult. In the short term, 2009 is anti-unemployment and anti-recession. As mentioned earlier, there may be difficulties in the short term. The most prominent contradictions and threats are unemployment and recession.The government's rescue of the market has injected a large amount of funds into state-owned enterprises, while small and medium-sized enterprises are in jeopardy.However, it is known that small and medium-sized enterprises account for 3/4 of employment, and state-owned enterprises have not been able to increase the employment rate in recent years, but have actually decreased.Small and medium-sized enterprises are the new force of employment in China. If they have problems, the imbalance of employment security will inevitably be unavoidable.The main threat in the short term will not be inflation.After all, whether it is fiscal or monetary policy, this rescue did not show obvious inflation performance in 2009.Although there are many currencies, but due to the time lag of the currency itself, the general situation is as long as two years and as short as half a year.

In the West, it is generally 6 to 8 months, but in our country it is about 7 to 24 months. Therefore, the loose fiscal policy was implemented in 2009, and the loan has probably exceeded 8 trillion yuan.In short, we are implementing a more proactive fiscal policy, because the fiscal deficit is already more than 900 billion yuan, which is already close to the warning line. Usually, the fiscal deficit is 3%, which is 1 trillion compared to the gross national product.If this continues, a problem will arise: China's economy is essentially a race between "two wheels", and the same move forms "two wheels".This round of expansionary fiscal and monetary policies will, on the one hand, drive demand expansion and economic growth; on the other hand, it will also drive up various costs and drive inflation.While demand is expanding, it not only has the effect of stimulating growth, but also has the effect of promoting inflation.For a period of time, especially before the formation of inflation, China, driven by economic growth, has been able to alleviate the unemployment problem in the short term and achieve certain results in anti-recession and anti-crisis; after a year or two, when inflation becomes the top priority When there is a problem, we can free up our hands to focus on managing inflation.Therefore, in order to alleviate the unemployment rate now, the price paid is future inflationary pressure.Regarding the medium term, the main task in the next two to three years will be anti-stagflation, because the economy may stagnate, the speed of development will not increase, the unemployment rate will remain high, and inflation will occur on the other hand.

After the implementation of the short-term policy, it will not show inflation, and more will show that it stimulates growth, but in the medium term, it will be manifested as demand-pulling prices. After one or two years of economic cycle, it will drive up costs, and costs will push up prices.If this round of macro-control measures does not significantly stimulate economic growth, then the unemployment rate cannot be effectively alleviated and reduced in the short term.After this period, inflation will show up, and the Chinese economy may appear in a very complicated and difficult situation.In other words, there may be economic stagflation in the next two years, that is, the coexistence of economic stagnation, high unemployment rate and inflation in the West in the 1970s.This makes it difficult to choose a macro aggregate policy, because inflation and economic stagnation require the direction of macro-control to be opposite.In the near term, it is mainly anti-recession, and in the medium term, it is mainly anti-stagflation.It means that the task must be clear first. In the near term, it is anti-recession. For this reason, even if inflation is increased, it is worth it-this is exactly the case with the Phillips Curve of Keynesianism;The connection is nothing more than two: first, the measures taken first must show expansionary effects as soon as possible. If the expected effects on economic growth and anti-unemployment are not achieved, it will be troublesome; second, if the expected effects are achieved, the unemployment rate will be very low If the economy grows up, there will be no fear of inflation in two years. At that time, it is okay to sacrifice the unemployment rate in exchange for a reduction in inflation.

In terms of economics, there are originally two goals for macro-control: one is anti-inflation and the other is anti-unemployment. However, in the medium term, there may be problems with these two goals at the same time, and then there is no choice for the macro-aggregate policy. This problem arose in the West in the late 1970s.When the unemployment problem and the inflation problem appear at the same time, the key is whether they can be replaced.This was the case with Keynesianism at the time. There was a choice and replacement between the inflation rate and the unemployment rate. Fix inflation.For this reason, all goals must be subordinated to this goal, and would rather reduce demand and reduce inflation, and would rather let the market weaken, the unemployment rate rise, and the economic growth rate slow down, in exchange for a reduction in the inflation rate.

Policy is all about focus.If in another period of time, the goal of China's macroeconomics is not inflation, but the unemployment rate, economic stagnation and depression, then all problems must be compromised to solve unemployment.When this happens, it is necessary to stimulate demand at the cost of rising prices, which means that the policy focus at this time is to reduce the unemployment rate without hesitating to increase the inflation rate.In order to solve the current main contradiction, the secondary contradiction can be sacrificed. This is Keynes' policy proposition.But some people think, why did problems arise in the 1970s?Especially during the war in the Middle East and the oil crisis, the price of oil rose from $3 to $12 per barrel (a 4-fold increase), and the cost of the entire national economy increased globally. At this time, stagflation appeared.This situation actually means that Keynes's method has failed.

China's economy is moving towards "cautious optimism".Can you make an expectation on the future trend of China's economy? Wei Jie: In my opinion, the most basic things in China have not changed, and the process of industrialization and urbanization will continue to promote economic development.Based on the status quo of China's economic and living standards, ordinary people still have a strong desire to get rich, and the driving force for the continued development of China's economy is still there. We call it "two modernizations and one driving force": the desire to get rich, coupled with the process of industrialization and urbanization.For the common people in China, the desire to get rich can be realized with the support of industrialization and urbanization, thus driving China's economic development.For Chinese entrepreneurs, attention should be paid to the improvement of ability and self-cultivation. On the one hand, the society should cherish them, and on the other hand, they should promote their improvement on this basis.Only in this way will the economy continue to develop to the high end.In the context of the current global recession, mainstream scholars have two attitudes towards the future: one is very pessimistic, believing that China will have major problems, and even predicting that next year’s growth will only be 3%; Focus on problems and overemphasize hopes.My point of view can be said to be in the middle of the two, and it should be "cautiously optimistic".I estimate that 2009 will be a difficult year, and there may also be opportunities for major reforms. For example, the increase in rights defense incidents will inevitably lead to high-level accountability.So this is a year that deserves our attention.

Optimistically, after 2009, the Chinese economy will have a new life. What are the important tasks in 2010?Will China continue to maintain growth in 2010, and if so, should it continue the basic policy of 2009?If the policy in 2009 is continued, should we make an adjustment based on the situation in 2010? Wei Jie: Now it seems that a consensus has gradually been formed that maintaining growth in 2010 is still an important task for China, and that the policies and methods adopted in 2009 should be continued and some basic adjustments should be made according to 2010.I would like to discuss the situation in 2010 according to this consensus. Our top priority in 2010 must be to continue to maintain growth.In addition to the recent "Dubai incident", many international incidents will break out in 2010, which will have a great impact on China.It should be that China must continue to maintain the growth rate at around 8% in 2010 as its top priority.In this case, there are three main countermeasures in 2009. How was the situation in 2009, and how to adjust in 2010?This is what I focus on. In 2009, there are three main countermeasures to maintain growth: the first is to initiate investment.Investment consists of three parts, one is people's livelihood investment.There are four categories: health care, culture, education, and infrastructure.The second is productive investment, which is investment in various industries. For example, investment in manufacturing, investment in high-tech industries, and so on.The subject of productive investment is the enterprise.The third type of investment is asset investment.It mainly includes capital market investment and real estate market. In 2009, three types of investments were launched, and now we can see that the effects of people's livelihood investment and asset investment are more obvious. In 2009, China's economic growth was promoted. From the perspective of investment, the effect of people's livelihood investment and asset investment is more obvious.The contribution of people's livelihood investment to GDP growth is relatively large.Asset investment started in November, and the real estate capital market is far better than in 2008.Therefore, from the perspective of investment, among the three types of investment, the effect of people's livelihood investment and asset investment is more obvious.But productive investment is far from achieving the expected effect and due contribution.why?Mainly a structural issue.It is the unreasonable structure that hinders business investment. Now many companies have entered the stage of excess productivity, and of course they can no longer invest. It is a process to go from surplus to shortage. Now the structural adjustment has not achieved much effect, so enterprises cannot invest, and of course production investment cannot be raised.Therefore, I estimate that the important breakthrough in investment in 2010 will be productive investment, and the main problem of productive investment is structural.Why can't the structure be adjusted?For example, the State Council has repeatedly emphasized structural adjustment, and enterprises also want to make structural adjustment, but it is very slow. Wei Jie: The main reason is technology access. That is, there is no core technology, so there is no way to increase investment.Now many companies want to invest, but they can't, because they don't have core technology.I went to Dongguan and Wenzhou for research, and the reason why many capitals have money but cannot invest is that there is no core technology.The lack of core technology has kept China's technological innovation off track.China's entire technological innovation system has not been formed, so technological investment cannot be carried out, and we cannot enter the shortage field, so it is difficult to adjust the structure.For example, the reason why the United States is very strong in technological innovation is that it has a very effective technological innovation system.The United States is a big country with an industrial economy, the core of which is technology.China just lacks this very important system. The United States regards the industrial economy as an incubator for technological innovation, which is to incubate knowledge into technology.And many of our governments run development zones everywhere.The United States is a powerful industrial economy country, and now exports are dollars, one is rules, and the other is technology, and China lacks exactly this.Therefore, the focus is on the structure of the technological innovation system, and the structural system of technological innovation is a reform issue, so some people emphasize that reforms should be accelerated in 2010.So I think, regarding the start-up investment issue, the start-up of the three major investments in 2009 should be people’s livelihood investment and asset investment with better effects, mainly because productive investment cannot be raised, and the main reason why it did not rise is the unreasonable structure. It is because the technological innovation system has not risen. This is the first analysis on start-up investment in 2009 Guaranteed Growth. The second strategy to maintain growth in 2009 is to start consumption.This aspect has been done very poorly. In 2007, the contribution of exports to growth was RMB 10 trillion. In 2009, it was less than half.At the beginning of the year, two measures were set to start consumption, one is to increase income, and the other is the social security system. These two measures are very poor.Now the growth of low and middle income is minimal, coupled with the recent adjustments on taxation and income increase, some benefits have been included in the scope of personal income tax.In a sense, the income of low- and middle-income earners not only did not increase in a certain sense in 2009, but also slightly decreased in some units.The social security system is also not up to par.Although the consumption in 2009 has increased compared with that in 2008, as far as we are concerned, it is far from the expected effect. In 2009, exports decreased by 5 trillion GDP, but almost 4 trillion was due to investment, and consumption accounted for only 1 trillion.Therefore, in 2010, I am afraid that the focus of investment and consumption will be the start of consumption.The focus of consumption start-up is to take major actions to increase people's income and improve social security.Looking at the wave line of income from 1998 to 1999, it shows that people's income has suddenly risen to a higher level, which has greatly contributed to economic growth. We need to reform the current national income. At present, the proportion of personal income of residents is relatively low, and the proportion of national fiscal income is relatively high. The key point is to adjust this structure.If this structure is not adjusted, personal income growth will be difficult.Therefore, in 2010, attention should be paid to the issue of consumption, and more work should be done on the distribution of national income and the establishment of a social security system.For example, 300 million to 500 million yuan was proposed for tax rebates in 2009. I investigated the number of rural household appliances going to the countryside because the number was too small, and there were problems with the approach.The most important burden for ordinary people is education. In 2010, the tax rebate should be increased to 200 billion, and the tax cut for individuals is only 220 billion, which is too little.I suggest that the tax cut in 2010 should be at least 500 billion. Can the personal tax threshold be increased in 2010? If tax rebates, tax reductions, and personal tax thresholds are implemented, consumption will increase significantly. In 2010, accelerated adjustments should be made in this regard.Compared with investment and consumption, investment made a relatively large contribution in 2009, and consumption did not achieve the expected effect. The reason is that the reform of national income and the establishment of the social security system did not achieve the effect.The third countermeasure to maintain growth is to adjust the macroeconomic policy and implement a loose monetary policy. Judging from the situation of these two policies in 2009, we believe that the monetary policy should be tightened in 2010. Monetary policy was too loose in 2009. The definition of loose monetary policy in 2009 is that the money growth rate is about 17%, and the new loans are 5 trillion to 6 trillion. In 2009, the new loans amounted to about 10 trillion yuan, which is not about 17%, but about 30%. This is the most relaxed since China's reform and opening up.Therefore, economic growth must be stable and balanced.I personally think that the loose monetary policy in 2010 will continue, but the measurement must be constrained.It should be the CPI growth rate in 2010 plus the GDP growth rate, plus 4 to 5 growth points. In 2010, the GDP was about 8%, and the CPI was about 3%, adding up to 11 points; in 2010, the currency increased by about 15%, equivalent to more than 7 trillion new loans.I talked to some entrepreneurs on the phone last night, and he said no, with one-third less new loans than in 2009, it is impossible to guarantee an 8% increase in GDP.Therefore, I estimate that the extent to which the loose monetary policy will be quantified in 2010 may still be a process of controversy.I personally think that a balance should be sought.Finding a Balance Point In the end, the monetary policy is still loose, but the amount is controlled.I personally think that new loans must be controlled below 7 trillion yuan, otherwise there may be problems and it cannot be extended until 2009. The fiscal policy in 2009 was active, but I judge that the fiscal policy in 2009 was not too active.Because the central government has a balance of 6 trillion national debt at the end of the year, which is equivalent to borrowing 20% ​​of GDP.According to the standards of EU countries, a country can borrow up to 60% of its GDP. Judging from this standard, our fiscal policy in 2009 is clearly not active enough.Therefore, if the fiscal policy can be more active in 2010, the monetary policy can be controlled below 7 trillion yuan.In a recent discussion, some people said that your calculation method is wrong. They said that the current national debt balance is not 6 trillion, but 22 trillion. Last year, it was 300,000 GDP. If you borrow 60%, you can borrow 18 trillion. Now it is 22 trillion. Therefore, fiscal policy in 2010 can no longer be positive.Later, after research, it was found that the EU standard did not seem to be suitable for China, because the EU is a privately owned country, and debt repayment depends on taxes, while we are a public owned country with huge state-owned assets, so there is no need to be afraid at all.Our state-owned assets of land resources sell at least 30 trillion yuan, and we believe that the fiscal policy can continue to increase, so we advocate that the fiscal policy in 2010 should be more active.This is the effect of the three major measures to maintain growth in 2009. To continue it in 2010, we must make an adjustment according to the situation in 2009.Let me summarize three main points: The first adjustment is investment. In 2010, we should pay more attention to productive investment. The key is structural issues, and behind the structure is the establishment of a technological innovation system.The second adjustment is on consumption. In 2010, more attention should be paid to the start of consumption. Consumption contribution in 2009 did not achieve the desired effect.The third adjustment is in the macro policy.From an overly loose monetary policy in 2009, to a proactive fiscal policy and a somewhat restrained monetary policy. There are clear skies after China's economic downturn.After five consecutive years of double-digit growth, the GDP growth rate in 2009 may drop sharply, and many people are worried about whether they can maintain the set target.What is your view on economic growth? Zhang Zhuoyuan: Generally speaking, China's future economy has good prospects.First of all, we have a high savings rate, which can be converted into investment, and investment can promote economic growth; second, China has a vast market, especially a potential market, and the consumption level and income of farmers and rural areas are still very low; third, , China has a very abundant labor force, they generally have a junior high school education or above, and their technical strength is growing rapidly.In addition, our system is also constantly improving, and it is also very important to continuously inject new vitality into the economy. However, it may be difficult for China to build a sound socialist market economic system in the future, because there are still several reforms to be tackled, including the reform of state-owned enterprises, the reform of monopoly industries, and the reform of distribution relations.China's economy is currently in decline. After five years of double-digit rapid GDP growth from 2003 to 2007, it is time to take a break.I think there are two main issues to be resolved during the rest period: one is the transformation of the growth mode or development mode; the other is to solve the problems of economic imbalances in several aspects, such as the uncoordinated ratio between domestic demand and external demand, consumption and investment, and exports.When the Chinese economy was supposed to rest and slow down, it encountered the international financial crisis, which led to a decline since 2008.With the government promulgating many rescue policies, I estimate that the overall economy will not experience negative growth, but the growth rate will decline.However, some specific indicators will experience negative growth, such as export volume and power generation.The Central Economic Work Conference proposed to "guarantee 8" in 2009, and it is estimated that it can be achieved through hard work. In 2010, GDP can return to the normal range of about 9%, which is achievable. How long will the crisis last?The speed of transmission and the scope of influence of this crisis are unprecedented. From the US subprime mortgage crisis to the financial crisis and then to the global economic crisis, how long will it last? Wei Jianing: At present, there are three opinions on the duration of this economic crisis at home and abroad: one is V-shaped, that is, it will bottom out within one or two years, and it can recover quickly in the short term; the other is U-shaped, that is, it will last for three to five years. Time, there is an adjustment period; the third is L-shaped, that is, the adjustment time is very long, maybe ten years or more... This possibility exists, and Japan was a typical example back then.We have repeatedly reminded to pay attention to the dangers of the bubble economy, because the bubble economy can only know how dangerous it is after it bursts.The bubbles are similar, but China's social structure is not quite the same as that of Japan, and the situation in China may be more complicated than that in Japan.How did Japan's economic bubble form and burst? In the mid-to-late 1980s, after the sharp appreciation of the yen, Japan implemented a loose monetary policy in order to resist the economic recession caused by the blocked exports.Due to the loose monetary policy, a large amount of funds have flowed into the asset market, causing Japanese real estate prices and stock prices, including the prices of golf membership cards and cultural relics collections, to rise two or three times in a few years. After commodity prices began to rise in 1989, when the central bank had to raise interest rates, the stock market bubble burst as soon as the interest rate was raised, and the real estate market bubble also burst, so the entire bubble economy burst.Later, the former governor of the Central Bank of Japan came to China several times to talk about this matter, saying that according to the lessons of Japan, the central bank should not only pay attention to general commodity prices, but also pay attention to asset prices.We should now also pay attention to the situation after the bursting of Japan's bubble economy.After Japan's bubble economy burst, there was more than ten years of economic stagnation, and later a relatively serious financial crisis broke out.We should also notice, what did the Japanese government do after the financial crisis?It is to accelerate the reform of the financial system.The Japanese government has mainly done three things: the first thing is to strengthen the independence of the central bank, because during the formation of the bubble economy, the central bank of Japan was not only controlled by the government, but also controlled by the leaders of the Ministry of Finance. Independence; the second thing is to separate financial supervision from the Ministry of Finance, and gradually transition to the current Financial Services Agency after several twists and turns; the third thing is to promote the reorganization of financial institutions and develop financial holding groups.We should also pay attention to the fact that although Japan's economy stagnated for more than ten years after the bubble economy burst, and a serious financial crisis occurred, it did not experience major social turmoil. I think there are two important reasons: The first reason is that although its financial safety net is not sound enough, it still has a financial safety net.The financial safety net generally includes three things, one is the lender of last resort function of the central bank, the other is the prudential supervision function of the financial regulator, and the third is the deposit insurance system.After the financial crisis in Japan, on the one hand, it accelerated its financial reform, and on the other hand, it adjusted its deposit insurance system, which quickly stabilized the financial market.Without these, its financial crisis must have been much deeper.Another one is that Japan has a very strong social security function, which means that its social safety net is very sound.Therefore, Japan's economy has stagnated for such a long time, and many people have been laid off and unemployed, including the emergence of the financial crisis, but there has been no major social turmoil. One important reason is that its social safety net is relatively sound.In my opinion, China should seize the time to establish these networks instead of just engaging in project investment.Otherwise, once there is a problem in the Chinese economy, there will be great risks.Most people probably still think that the establishment of a safety net cannot solve the immediate needs, and that the establishment of a project can stabilize the status quo so that there will be no major problems in the short term.No amount of money is willing to invest in projects, but it is not willing to invest money in invisible projects such as the establishment of a safety net, because it does not reflect political achievements.In fact, it is still a matter of reluctance. Now, looking back, Premier Zhu Rongji's social security reforms were far-sighted, but the follow-up policies did not continue to advance.In terms of policy, we still need to have a reflection.Theoretically speaking, if the macro economy is overheated, monetary policy should be tightened to curb the overheating, and when it is cold, an expansionary fiscal policy should be used to start the economy.But now I have found a paradox. When the currency is tightened when it is hot, private enterprises and small and medium-sized enterprises are the first to be hit; when projects are launched when it is cold, state-owned enterprises and large enterprises often benefit first.If things go on like this for a long time, the economic entity will be divided, and the large state-owned enterprises will get better and better, while the private small and medium-sized enterprises will become more and more difficult.The emergence of this paradox is due to problems in the way of regulation.When we tighten the currency, we rely on loan scale control instead of interest rate, so first of all we control loans to small and medium-sized enterprises; if we use interest rate means, it seems to be a one-size-fits-all approach, but there are profitable projects, regardless of the size of the enterprise. loan.Regarding the export tax rebate and the appreciation of the renminbi, there are two issues to be considered.One is that the economic downturn in the United States and the world is due to the absence of demand, not the issue of prices.Unlike the Asian financial crisis, when the demand was still there, the U.S. economy was booming, and other countries were depreciating. If we did not depreciate, there would be a problem of price competition.The other is that China's long-term development mode needs to be changed. It will continue to rely on export subsidies and the undervaluation of the RMB exchange rate, which is tantamount to giving welfare subsidies to foreign consumers. So now we are going back to pick up export policy and exchange rate policy, and use the past methods to deal with the crisis, which may be problematic.Some experts said, instead of subsidizing export enterprises, why not subsidize farmers?When farmers have income, they can expand domestic demand.We always propose to change the development method, but when it comes to emergency, we throw it aside.In my opinion, when the financial tsunami hits, the top priority is not to "go out to buy bottoms" (acquisitions), nor to "digging holes to store water" (expanding domestic demand), it is too late.The most important thing is to "build a breakwater", build a financial safety net, build a social safety net, and keep your own safety first. China is currently in a downturn in foreign trade and real estate consumption. Trying to stimulate domestic demand with huge investment in fixed assets may guarantee a temporary GDP.However, if the U.S. economy cannot get out of the shadow of recession in the next two or three years, where will the support point of the Chinese economy be? Wei Jianing: The national treasury is relatively rich now. Once large-scale capital investment fails to produce good effects, and the money will be spent by then, it will be very scary.Therefore, we cannot fail to mention the reform of the monopoly sectors, especially the reform of the railways. "4 trillion" will largely be invested in railways. The problem is that the railway system is the most backward, and the government and enterprises are integrated. It cannot drive private capital.Therefore, relying on reforms and mobilizing private capital, the government can invest very little money to solve big problems. The United States proposed "Buy America", which violated the WTO agreement.Professor Stiglitz, we are concerned that against the background of the global economic recession, trade protectionism in various countries is generally on the rise.How do you view this phenomenon? Stiglitz: Trade protectionism is indeed a very important topic. At the G20 summit in Washington in November 2008, everyone agreed that protectionism cannot be promoted, but a few months later, 17 countries have adopted protectionism so far.That's a really impressive thing.The United States proposes "Buy America" ​​(buy American goods), which violates the WTO agreement.At the same time another point is the WTO agreement, which rarely takes into account poor countries.It is more from the standpoint of developed countries than developing countries.This is actually worse than protectionism.It is very important that countries do not promote protectionism. I hope that protectionism will not happen, otherwise it will make economic recovery difficult.Because this is a very simple truth in economics, each country is launching its own economic stimulus plan, and the plan is to maximize its own interests, so it is bound to promote protectionism. Then the benefits brought to the country in the stimulus plan will be offset by the protectionist policies of other countries.If every country only pursues its own interests, the end result is that every country is worse off.But unfortunately it is very difficult to eliminate trade protectionism.We all know that tariffs are an important means of protectionism, while subsidies are also a form of protectionism.In the economic stimulus plan of various countries in response to the crisis, the impact of subsidies is greater than anyone imagined.Now there are subsidies in many industries such as the banking system and the automobile industry, which are very detrimental to economic recovery.Therefore, after this crisis, we have to rethink the issue of globalization. These measures of protectionism have completely offset the benefits of the economic stimulus package. Where is the world economy headed?Based on your observation, where will the development of the world economy go? Stiglitz: There are some issues that are very important, and that is global poverty, environmental issues, and global warming.These are very important questions.The key lies in how to improve the inefficiency of the economy: how to allocate resources to where they are most needed, and how to ensure that the purchasing power of our consumption can be transformed into products that society really needs.What we should do is to slow down global warming in the next decade.There is enough demand on this front. We will have enough incentives and opportunities to convert these needs into the market.就这个问题，我对联合国有三个关键的建议：首先，需要一个新的全球信贷机构，而且它的监管应该比现有的机构更好；其次要建立一个全球经济协调委员会；最后要有一个新的全球储备体系。这是一个很早就被凯恩斯提出来的问题，而目前的系统运行并不良好，所以现在到了需要对其进行改革的时候。作为金融危机的肇发地和重灾区，美国的经济遭受了前所未有的冲击。但我认为美国仍将是世界上最大的经济体，仍将是世界经济的重要组成部分。但它以后可能无法施加危机之前它所能产生的影响，原因我认为在于美国的金融行业。美国可能需要很长一段时间来真正走出危机。那么今后美国、中国、印度等国家就会共同成为世界经济的主要力量。一个深层次的问题是，美国有可能重复这样的故事：从一个泡沫走向另一个泡沫。有人问，美国人现在应该增加消费还是增加储蓄？我觉得这个问题一直是经济学家在讨论的两难问题。 遇到现在的经济问题的时候，大家会说收入会下降，从长远来讲我们是肯定需要更多的储蓄，零储蓄率绝对不行。但是，问题是现在储蓄率在上升，这是美国所面临的最大的经济问题。在我讲到美国应该如何恰当地应对经济政策的时候，我提到我们不应该鼓励消费，而是应该鼓励投资。比如说，如果你要减税的话，我们应该提供投资信贷，使大家能够更多地投资。给居民减税并不是非常有效的，这不是一个正确的方向。从长远来说，正确的方向是更多地储蓄和更多地投资。关于美国所做出的应对政策，大家认为迄今为止美国做出的反应还是很不够的，那会使危机持续时间更长。大家应该从美国的失败当中吸取教训，这不仅仅是在金融领域，而且在公司的法人治理中有更深层的问题，这些银行发展得块头过大，以至于它们不可能不失败。我们还需要货币政策的框架，有很大问题的货币政策框架也造成了这次的危机。大家已经多次讨论过全球化，它有好处也有坏处，这也就意味着在面对全球化的时候，我们要非常小心。 我们需要认识到有一些全球性的协议是由一些觉得市场万能的这些人所制定的，因此，这些协议也是有问题的。我们多次提到这是一个全球性的危机，也需要全球来应对。我们需要国际组织来行动，有G20，但是全球有192个国家，也就是说172个都不是G20的成员，而世界上的很多国家都受到了影响。联合国有一个专家委员会在研究危机对发展中国家的影响，我是这个委员会的成员，我们提出了一些建议。一个就是钱的分配办法要改变，现在的机制效率太慢了。如果这样改革的话，等到下次危机到来之前都不能够完成这些改革。我们需要一个新的分配制度，需要一个全球协调机制，也需要一个新的全球储备体系。在这期间我们可以发挥区域倡议的作用，比如说清迈议程。在实现全球经济复苏的过程中，中国可以发挥重要的作用，它可以使自己的经济保持增长。另外，就是它可以为全球均衡地恢复做出贡献，中国可以帮助其他的发展中国家，这和中国自己的价值观是一致的。我希望中国在它自己所属的这个区域以及在全球建立恰当的机制，使得更多的资金能够转向新兴市场方面发挥其作用；并通过G20和联合国来进行必要的改革，以恢复人们的信心。