Chapter 50 5. Looking forward to 2020: an era of prosperity for the people

In the ten years from today to 2020, the goal we are looking forward to is for the government to make timely adjustments to bring the goal of economic development back to the track of people’s prosperity. The ultimate form is to make the people rich as soon as possible. To establish a large enough middle class in time to realize an era of real wealth for the people is the only way to avoid disaster in the new round of economic recession. Topic Introduction: Welfare Economics in History - The Coming of the Age of Wealth of the People Changes in the economic situation are always beyond the expectations of most people.

Just when people thought that the Chinese economy in 2008 would usher in a booming year, it suddenly ushered in the ebb and bubble of the global economy. In such a sudden economic crisis, China's real economy has been hit so hard that it even surpassed the source of the crisis. The survival of many industries and enterprises has even become an urgent problem to be faced. As we have analyzed in the previous chapters, the reason for this situation is that, on the one hand, China lacks sufficient foresight and predictability for the trend of economic changes; on the other hand, China’s unique economic structural defects make It is difficult for the people to achieve prosperity, and it is also difficult to form sufficient demand, which results in our excess production capacity and has to rely on external demand to release it. When the international economy is in crisis, we are hit the hardest, which is naturally the answer to the question. It makes sense.

As the Nobel laureate in economics Paul?As Krugman put it, China is still a poor country.We can see that in China today, the average wage of workers is 4% of that of workers in the same industry in the United States. This figure is only equivalent to the level of South Korea in 1975. The wages of workers are more than three times that of Chinese workers. Because of this, for China, the economic problems caused by the poverty of the people are getting more and more serious, and the only way out for China's future is to make the people rich. When the country really focuses on the development of the national economy, it means the arrival of an era of wealth for the whole people.

In history, there was such a story that can be used to prove the correctness of this view. Under the door of the sage Confucius, there was a disciple named You Ruo. According to the records, Duke Ai of Lu once asked him for advice on how to solve the shortage of national income in famine years. . The so-called "True Law" refers to the tax standard of 1 in every ten, that is, 10%. At that time, the tax quota of Lu State was 20%. This change from more to less naturally caused Duke Ai of Lu was surprised and opposed. In Lu Aigong's opinion, a 20% tax rate is not enough to meet the country's needs, let alone cut the tax rate by half.To such a question, You Ruo replied: "If the people are rich enough, how can the country not be rich? If the people are not rich, how can the country be rich?"

Such a view is actually the earliest theoretical elucidation of the relationship between the rich people and the rich country. According to this view, the sign of a country’s wealth is nothing more than a large surplus in the country’s fiscal revenue on the books, and the source of this surplus is the surplus of people’s life and production. When the country’s extraction of the surplus from the people exceeds a certain limit, It will inevitably make people's life and production unsustainable. Therefore, striving for temporary "national wealth" will undoubtedly make the country's fiscal revenue more tense in the future, and the people will be poor, so the country will naturally be unable to achieve the political goal of being rich.

Conversely, if the people are rich, it will trigger a new upsurge in their consumption, which will enable the economic industry to expand reproduction. In this way, even if the country adopts a lower tax standard, it will get more fiscal revenue. That is to say , the wealth of a country depends on the total amount of wealth owned by the people. In fact, the core of this point of view is exactly in line with the concept of welfare economy in modern Western economics. Its essence is for the state to perform its own functions, and while helping the development of the national economy, obtain a share that belongs to the state.

In terms of long-term goals, the country implements a welfare economy model in the national macro-economy, which is bound to establish a long-term development mechanism, stand on the same level as the people in economic life, and ultimately achieve the political goal of common prosperity. Theoretically speaking, the more prosperous the national economy is, the more it needs the state to provide environmental protection for it. Only by making the environment stable enough can the further development of the national economy be triggered. Conversely, only when the national economy is sufficiently developed, Only by creating more physical wealth and monetary wealth can we support the stability of the country's finances and meet the country's normal fiscal expenditures.

The number one obstacle to China's economic development is based on sluggish domestic demand, and its deepest root lies in the poverty of the people and the unsound social security mechanism. In fact, when our economy is growing rapidly, the wage income of our residents has been hovering at a low level for a long time. According to the survey of the International Labor Organization, from 2000 to 2005, China's per capita output growth rate reached a staggering 63.4%, which is far ahead of India's 26.9% and ASEAN's 15.5%.However, such a high growth rate is not reflected in the increase of wage income at all, which also shows that with the deviation of the wealth distribution mechanism, no matter how labor productivity increases, the people will not enjoy the benefits of this increase. results.

When our wealth distribution mechanism fails to favor individuals and businesses on a large scale, it means the emergence of difficulties. The beginning of any predicament represents the beginning of adjustment. In the ten years from today to 2020, the goal we are looking forward to is for the government to make timely adjustments to bring the goal of economic development back to the track of people’s prosperity. The ultimate form is to make the people rich as soon as possible. To establish a large enough middle class in time to realize an era of real wealth for the people is the only way to avoid disaster in the new round of economic recession.