Premier Zhu was how to deal with financial crisis?

    China on the current economic situation to judge, academics say, mixed. But look at the newspaper, the mainstream view of economic fundamentals have not changed, and will continue to improve. The judge himself, and still more or less optimistic about the economy is not without risk, but said that as long as the Government's handling well, the soldiers will be to block China's economy can be saved.

    Said that in 2008 China's economy is a more difficult year, I agree. But the point to mention is that today we encountered difficulties, in fact, also met in 1998. There are surprisingly similar history. 10 years ago, the Asian crisis, the United States is now at a crisis loan; 10 years ago, 12,000,000 of laid-off workers of state-owned enterprises, private enterprises now there are 12,000,000 unemployed workers; 10 years ago, the Yangtze River, Songhua River floods occur; first year and ice disaster After the earthquake, the economic losses were not a century.

    As an ancient saying goes: The funeral did not forget to do before the army. As previously experienced, then sum up "before" and learn to solve today's problems will certainly help. In the past done right, this can be done; deficiencies, to improve the environment. The question is what to do in the past right, and less where a matter of opinion, to have the same views is not easy. The good news is not far away for 10 years, we are back again, I say point, it made a calculation. First, the right side, the major issues, I think there are three points:

    First, fiscal policy U-turn in a timely manner. As we all know, 98 years prior to the macro-control tone is "tight", not only from the tight fiscal and monetary policy tightening. 97 years after the Asian financial crisis, the Government of stimulating domestic demand, decisive positive change (expansion) fiscal policy. The initiatives that year, the Financial 100,000,000,000 issue special treasury bonds, at the same time by commercial banks 100,000,000,000 loans, all the money for infrastructure investment. Down with a four-year, the annual financial bonds issued more than 1,000 billion to support the development of the western region.

    Second, the modest relaxation of monetary policy. To stimulate investment, both the central bank, cut in the primary reserve, only 98 years on a year down 5 percentage points, from 13% to 8%; the other hand, lower interest rates, Premier Zhu's term of office, nine rate-day drop Times. Not only that, in order to boost consumer spending, the central bank since 1999 and introduced consumer credit, to encourage people to buy a car purchase. It should be said that these policies promote a strong domestic demand, curbing economic recession Moda Yan Gong!

    Third, the stability of the RMB exchange rate. Last of the Asian financial crisis, neighboring countries currency one-sided, one after another devaluation. The Chinese government Yinuoqianjin: the Renminbi yuan. Then Premier Zhu said that the Renminbi yuan, China must first take responsibility for a big country; Second, China's export structure is different from neighboring countries, exports will be affected, but will not cause illness; Third, domestic enterprises will be forced to implement industrial restructuring and upgrading. Now, Premier Zhu well, completely right. Imagine if the exchange rate to stabilize at that time not to let the yuan depreciated by 20% or less now have 50% of the influx of a large number of speculative hot money, I am afraid the situation even more difficult to deal with.
, Said the experience is over, there are lessons here? There are, of course. Wise after the event, also said that three points:

    First of all, the government's failure to make timely tax cuts. Economics, said that stimulate investment should be two main points: First, government procurement orders; Second, tax cuts for businesses. Financial bonds to increase government procurement, will no doubt reduce Yaku, but the Chinese enterprises, and government procurement is limited, beyond the reach of government can not take care of all enterprises. So for most businesses, more tax effective. Can be Unfortunately, despite the country to allow the export tax rebate, but not for the main tax rate reduction.

    Second, the price issue too seriously. Price has a bearing on the livelihood of the people, regardless of the East and West, the Government has attached great importance prices, there is nothing wrong. However, if the price too much weight, will certainly affect the government's major policies and decision-making. In the past, in order to control the CPI at 3%, the Government has always been afraid to open up prices. But the price was a negative growth, deflation, so that was already weak consumer market. In fact, consumers have a psychological, up to buy or not buy. Prices of goods on sale; price macro news is wait and see.

    Third, there is no significant pay rise. In all fairness, when Premier Zhu is intended to pay. I remember the autumn of 2000, Premier Zhu's speech to the Central Party School, I just present that day, Premier Zhu said that three years of civil servants to give up wages, up to three times. May be the result? Ray heavy rain or small, nothing. I thought, it would be the case, the government failed to give their workers wages rose. Official inflation is not up people, will lead to social conflicts. Another layer of reasons, the Government does not tax cuts and wage increases, would increase the cost of business investment.

    Wrote here, the reader should have seen that when the Government should "crisis" although there were mistakes on the whole is greater than a loss. But this is 10 years ago, and now the current crisis, we must look at, which is to be able to get inspiration. Think again recently, the answer to two words: "The expansion of domestic demand." Yes, people should rely on their own, not to mention the U.S. economic outlook remains to be seen how China has 1.3 billion people, as long as sufficient domestic demand and stimulate economic When not be a problem. That the specific point, I think there are three main things to do:
First, looking back to tax cuts. Tax cuts to stimulate private investment, not to mention. Recently, the Ministry of Finance and may be a few friends to meet, when it comes to tax cuts and friends are against it. The rationale is that China is not heavy tax burden, GDP ratio of less than 25%. China's GDP can not tell how much water, and my question is that the GDP last year, an increase of 11% and 30% of financial income. Financial GDP growth rate is twice as heavy tax burden does not explain how?

    Secondly, the relaxation of credit and interest rates. Is not alarmist talk for a rainy day, the Government should guard against possible deflation next year. Stringency in the past two years, the bank is no money to loan, and now I am worried that if business continued losses, banks will not loan does not? To take preventive measures, with its Mai Guancai lending in the future, if not borrow money to buy medicine. To this end as soon as possible, the central bank to relax credit controls, while allowing interest rates to Suixingjiushi.

    Third, raise the minimum wage. Have said many times, the relative growth rate of 10% of the GDP, consumer prices rose 5 percent is not high, the key is to keep pace with price growth in wages. Introduced at the beginning of the new labor law, explicitly raise the minimum wage, is a good thing; may be a reflection of the business community is generally not a good thing, so why? I think there is nothing wrong to pay workers, the government did not issue tax cuts, if the Government can tax, businesses will certainly take this opportunity.