Dai Yuanchen, an economist, strongly opposes the proposal of
increasing public servants' salaries to stimulate consumer
spending. Dai said China, suffering high unemployment and low
income in rural areas, should refrain from raising civil servants'
salaries so that money can be saved for compulsory education in the
country, something that would both relieve farmers' burdens and
stimulate consumption.
Dai gave his view at a recent forum on macro economy jointly
sponsored by Chinese Academy of Sciences and Zhongchengxing Credit
Assessment Company. Dai said there are many measures to expand
consumption. As China at present faces many problems, especially
high unemployment and poverty in the countryside, increasing
salaries -- which has been done twice -- is not necessary and the
third raise cannot be effective in increasing consumption. More
over, a salary increase costs 100 billion yuan (US$12 billion) each
time, and the added pay is difficult to lower, so it perhaps
restricts future macro-adjustment and control.
"The first time China raised salaries, I raised both hands to
support it; the second time, I raised one hand to support and the
other hand to oppose; if the salaries are increased this year, I
will raise both hands to oppose it, " said Dai. "One raise costs
100 billion yuan (US$12 billion). If the money is spent on rural
compulsory education, it will ease farmers' burdens and resolve the
problem of rural compulsory education."
Dai added that farmers' low income results from a lag in reform in
the country. Farmers, rather than the government, assume the rural
compulsory education costs, which reduces their incomes. Dai called
on the government to take on the costs of rural compulsory
education.
According to experts participating in the forum, farmers' income
remains at a low level, having increased only 4 percent in the past
five years whereas urban residents' income increased 8 percent over
the same period. And, the low income of farmers restricts further
economic development and adversely affects social security.
(南方網 [southcn.com],
translated by Feng Yikun for china.org.cn April 22, 2002)