Chapter 9 2. How hard is the government's hand?

Food prices soared, causing panic across the country.Affected by the panic-buying by citizens and the hoarding of some grain dealers, many places have sold out their stocks and started to be out of stock. Everyone understands what it means to be out of stock? In China, everything can be out of stock, except grain. On December 25, 1993, the State Council held an emergency meeting, quickly deployed, opened the national granary, and immediately sold 2.5 million tons of special grain reserves and 32,000 tons of commercial oil reserves. In January 1994, the state directly arranged 140 special trains, and the first batch of 700,000 tons of grain was delivered.Shaanxi, Shandong, Anhui, Beijing and many other provinces and cities have also successively sold local grain reserves.

Stabilizing food prices means stabilizing people's hearts and stabilizing society.The leaders of the provinces and cities could not sit still. Jiangxi Province is one of the main grain-producing areas in the country. However, due to various reasons, grain prices have risen rapidly, and food supplies in Pingxiang, Yingtan, and Jiujiang are in short supply.For this reason, Jiangxi Province quickly dispatched 150,000 tons of rice from the main production areas to Ganzhou, Pingxiang and other non-grain production areas.Nanchang supplies its citizens with 300,000 kilograms of new late rice every day.The governor came forward to tell the people of Jiangxi that in 1993 Jiangxi could exceed the production plan for grain, and the existing warehouses were full, with 7 million tons of raw grain in stock, which could supply the people of the province for 30 months, so as to dispel people's concerns.

Since Anhui Province fully liberalized grain prices and operations on April 1, 1993, the grain market has been calm. In October, due to the bulk purchase of grain from areas short of grain in other provinces in Anhui, the price of grain rose, and the price of grain in the cities of the whole province generally rose by 30%, which aroused the attention of urban and rural residents. On December 6, a vice-governor of Anhui Province announced to the whole province in a teleconference that 120 million kilograms of grain would be sold to the market within a few days and grain prices would be controlled to protect the interests of the masses. On December 20, the price of the grain market in the province tended to drop.

Nanjing City provided 10 million kilograms of grain and 2.5 million kilograms of cooking oil to supply the market.Changzhou City imposes a maximum price limit on the grain and oil market, and at the same time, the Municipal Grain Bureau allocates 10,000 kilograms of rice and 1,440 kilograms of cooking oil to each grain store to ensure market supply. For a while, on the railways across the country, we saw trains of grain trains rushing away, and on the main highways, rows of grain convoys galloped forward—fortunately, we had grain in our warehouses, and we had grain in our hands! On November 1, 1992, China announced the liberalization of grain purchase and sales prices and operations, and the 40-year history of unified purchase and marketing came to an end.

The "grain book" that symbolizes the "privilege" of urban residents has become waste overnight and thrown into the trash can by most people. The grain market is still calm, because most people seem to be psychologically prepared for the liberalization of grain purchase and sale prices and operations-everything is liberalized, and grain is an exception? But everything can be put, but food can't be put casually.Just a few months later, food prices rose suddenly, and the price rose faster and faster, causing the common people to panic and the government to be caught off guard.

Of course, this is not simply the fault of the liberalization of grain management, but we do not understand the market enough and are not prepared enough, but we must bear certain responsibilities. Faced with soaring food prices, the state sold a large amount of food and imposed a price ceiling. Although the market has stabilized, most urban residents are still uneasy: Will the ball rebound? The citizens suddenly remembered the abolished food book.After decades of ups and downs after liberation, what storms have we not seen?What difficulties have you encountered?But we feel at ease because we have a food book.Don't worry about food shortages, and don't need to worry about the price of food.

The food bank has been with the Chinese people for decades, but now that it is lost, there is a problem. Can the food bank come out of the mountain again? On December 21, 1993, "China Youth Daily" first reported: "Hunan Xinhuang: Everyone Hopes for Food to Come Out of Mountains".Xinhuang Dong Autonomous County completely released grain in May 1992, when the price was 1.10 yuan per kilogram.The expected chaos and panic did not come as promised. The residents who had lost their grain books and the government who had lost their burdens let out a long sigh of relief—there was no war in the grain market.But who would have expected that after more than a year of silence, food prices fluctuated, and they never looked back.People panicked: food is better.

A resident of Changsha also said frankly: "The food book is good, with it, I feel at ease." All over the country there are demands for the restoration of the food supply, and the voice of ordinary citizens is the highest.As a government department, restoring grain capital is also beneficial to stabilizing grain prices and stabilizing the market.The common wish of both parties has made the grain book, which has just been abolished for less than a year, reappear in many places. Urban residents in Hunan Province have once again received grain.Fortunately, it has only been abolished for one year, and the food department is familiar with the road, and quickly figured out the population base, and issued grain books one by one.Each urban resident can buy 10 kilograms of rice per month with a grain budget. The price is limited. One meter of early indica is 1.56 yuan per kilogram, and one meter of late indica is 1.96 yuan per kilogram, which is 0.6 to 0.7 yuan lower than the market price.

After Jiangxi Province restarted the use of grain, each resident will be supplied with 12.5 kilograms of rice per month, and the price is 1.4 yuan per kilogram for early indica rice and 1.6 yuan per kilogram for late indica rice. By the end of 1994, most provinces and cities across the country resumed the planned supply system, and urban residents took up their grain purchase books, and began to take a rice bag every month to the state-owned grain store to buy the allocated rice. In all fairness, it is really not a good idea to rely on the state-subsidized grain supply system, but in the current financial situation, we have to do otherwise.With the restoration of food resources in various places, people's hearts and markets have basically been stabilized.

In response to the soaring food prices, the Chinese government has adopted three tough measures. One is to sell special grain reserves to ensure market supply; supply. The measures are effective and the effect is obvious, but what people are worried about is: Will the ball rebound when held down? The grain price in Beijing has stabilized, but it is forced down by the government setting a price limit and more than 600 people patrolling and monitoring day and night. The price of grain in Guangdong fell somewhat, but it was controlled only by selling a large number of specially stored grains.

Food prices in Hunan are basically stable, but it is based on the resumption of planned supply. So, will China's grain prices rebound? We believe that the key is to look at the relationship between food supply and demand and circulation policies.If we continue to ignore grain production, discourage farmers' enthusiasm for growing grain, and make grain production insufficient to meet social demand, and the state cannot effectively control grain sources and control grain circulation, it is not impossible for grain prices to continue to rise. The Chinese government has realized this.While curbing the rise in grain prices, China has re-established the core and dominant position of grain production, and implemented the "rice bag" governor responsibility system, requiring leaders at all levels of government to personally handle agriculture and grain.At the same time, the state established and improved the grain reserve system to ensure sufficient grain sources.Strengthen the management of the grain market and maintain the normal order of grain circulation. Based on the above factors, State Councilor Chen Junsheng announced that the country is capable of coping with possible grain market fluctuations.He emphasized that my country's current national special grain reserves have reached the highest level in history, and local reserves also have a certain amount. The current grain stocks are abundant.The country is fully capable of coping with possible large fluctuations in the grain market. However, the issue of food prices will remain a sensitive issue for the Chinese.On the one hand, the majority of farmers are eager to reduce the scissors gap between industrial and agricultural products, increase grain prices, and ensure grain efficiency; on the other hand, the majority of urban residents are eager to stabilize the grain market and control grain prices. "The low price of grain hurts the peasants" and "the expensive grain hurts the people", embarrassing the Chinese government: the palms and backs of the hands are full of meat, the left is not right, the right is in a dilemma! China's grain price has been at a low level for a long time, and it is obviously inconsistent with the commodity value of grain, which is a great blow to farmers' enthusiasm for growing grain.This rise in food prices, to a large extent, also has the nature of a rebound after a long period of depression.However, the soaring price of grain is an abnormal phenomenon. It not only makes it unbearable for urban residents, but also increases the pressure of inflation and drives the rise of other commodities, which will eventually affect the interests of farmers.The benefits of rising food prices will be offset by inflation. Therefore, Zhu Rongji, then Vice Premier of the State Council, pointed out that to learn the lessons of the soaring grain prices and establish a grain mechanism adapted to the socialist market economy, the core is to have a reasonable grain price.This price should be able to mobilize farmers' enthusiasm for growing grain, reduce the scissors gap between industrial and agricultural products, and be affordable by the majority of urban residents. A food price hike subsided, but we paid a heavy tuition fee for it.I hope we can learn something from it and realize something. People regard food as their heaven, and food depends on food as their source. Chinese people must care about food and be sensitive to food prices!