That's what an expert should say! Professor Lu Feng from the School of Economics, National Institute for Development Strategy, Peking University stated that China needs to increase public welfare spending in the next ten years to boost consumption and raise the share of consumption in the economy to about half. Professor Lu pointed out that in recent years, we have seen that even with rapid productivity growth, insufficient demand can cause serious problems. If not addressed, it will lead to a series of risks, including low consumer prices, weak business activities, structural unemployment pressure, and low confidence.
Therefore, within the next five to ten years, China can increase the share of consumption in GDP from the current around 40% by five to ten percentage points. Obviously, Professor Lu's meaning is clear: in the next five to ten years, our country should use greater fiscal strength to support public welfare expenditures and thus solve the problem of insufficient consumption. It must be said that Professor Lu's proposal hits the mark.
In fact, from the perspective of ordinary people, it's not that people don't have the desire to consume or are unwilling to consume; the key is to enable people to have the ability to consume. Increasing people's consumption capacity can be done in two ways. First, through basic social security to provide a safety net, so that people feel confident to consume. Second, increasing people's income. Therefore, if the country continues to increase welfare in areas such as elderly care, education, healthcare, and childbirth, the disposable income of the people will naturally become more.
With a basic safety net, people's desire to consume will undoubtedly be higher. When people's desire to consume is higher, the probability of converting it into consumption behavior increases, and these consumption capacities will become demand, promoting employment and enabling our country's economy to form a positive cycle. In fact, our country has already taken measures such as issuing universal child-rearing subsidies and exempting the childcare and education fees for children in the first year of kindergarten at public kindergartens, which help to enhance residents' consumption capacity. We believe that our country will steadily improve residents' welfare in the future.
Original article: www.toutiao.com/article/1841418767128585/
Statement: This article represents the views of the author.