We want to earn more, but we must understand who we are earning!

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Source: dashuxiangzhang (ID: dashuxiangzhang)

As we all know, diplomacy is the continuation of internal affairs; However, it is difficult for people to realize that the imbalance of internal economy will also lead to external imbalance.

In the last article on foreign trade (we still want to earn more), we look outward, to see the relationship between trade, supply chain and RMB internationalization, to see how we protect our wealth from being harvested by US dollars, and to see what the real big money is in foreign exchanges.

In this article, we look inward to see what historical reasons have enabled us to realize this huge surplus. What impact will this huge surplus have on the general public?

And why can’t China’s huge trade surplus improve our lives?

Let’s start with the surplus itself.

In fact, we change the meaning of “high surplus” to “excess capacity”. The opposite of “excess capacity” is that our own demand is relatively insufficient, and we can not digest the surplus products at home, so we can only export them. This is exactly the problem of internal economic imbalance that everyone knows——

Our consumption is insufficient.

Then what causes our insufficient consumption? This has to go back to the historical development.

If the Chinese want to become rich and enjoy modern civilization, they must engage in industrialization. What industrialization needs most is capital, but what we lack most is capital.

It is no longer possible for modern countries to engage in colonization and bloody primitive accumulation. Where does capital come from? Either by internal accumulation, or by foreign investment or foreign debt.

Foreign debts are easy to borrow but difficult to repay. The Latin American debt crisis and the Soviet Union’s 59 year withdrawal are typical negative cases of borrowing foreign debt.

The scale of foreign exchange reserves in the early stage of reform and opening-up can be seen that the foreign exchange in the early stage was a single digit

Therefore, we choose to rely mainly on internal accumulation, and choose to exchange blood and sweat for initial funds for development.

So in the past, whenever there was a little surplus, we would continue to invest to expand production; The purpose of “land finance” and “land finance” is to attract funds from residents to promote industrialization and urbanization.

This is the dilemma of the development of late developing countries.

Lack of capital means that in the early stage of development, we must “attach importance to investment and neglect consumption” and “attach importance to production and neglect people’s livelihood”.

Friends who have done business know that when they start from scratch, when they get up in the morning and work in the dark, when they have to be careful with every penny, they will not pay high wages except for core talents.

This is true of individuals and countries alike.

The country’s land resources and financial resources will be inclined to capital. The local government will also give a large number of preferential policies to capital in the process of attracting investment and promoting local industrialization. The results of this are:

The share of capital gains in gross national income will grow much faster than that of labor income.

This is not to say that the wealth of workers will not increase, but the growth is certainly not as fast as that of capital, which is one of the root causes of the gap between the rich and the poor.

However, as the residents get rich, they put their wealth into real estate, which further squeezed the consumption space.

Increasing capital density is a prerequisite for improving productivity and realizing industrialization. It is remarkable that we can build such a large production capacity in such a short period of time, at the expense of insufficient consumption.

All the gifts of fate. The price has already been secretly marked.

Why has the surplus been maintained for a long time, the production capacity is still so high, and the people still feel that they have no money to spend?

Because in the past development process, the growth of labor income was not put on the top priority.

These are the reasons for historical development.

Why is it always emphasized that “when the reform is not completed, it is only in progress”?

Because there was a special development model when we started from scratch and accumulated primitive resources. This development model is only suitable for the early stage and only suitable for becoming the “world factory”. In order to adapt to this development model, we “allow some people to get rich first”.

The “world factory” is only the first step, and the “world’s richest market” is worth proud of. Our next step is to implement the second half of the sentence: “the rich first drive the rich later, and finally achieve common prosperity”.

But if you are kidnapped by an interest group and choose to continue playing the same old game, the final result will be that you can’t play.

Next, we have to ask: has foreign trade itself brought about an increase in the income of residents? Has it benefited the general public?

Yes, but very limited.

Chinese goods are good in quality and cheap in price, which is both praise and heartache.

In order to enter the foreign market, export enterprises usually have to rely on low prices. However, no matter how low the prices are, enterprises have to earn money. Who can be squeezed? It can only be domestic labor.

What is the essence of foreign trade? Exchange Chinese labor for foreign labor.

Good quality and low price means that the labor of a foreigner can be exchanged for the labor of many Chinese.

When the foreign trade industry is prosperous, it certainly makes money, but what it earns is the money of “quantity”, that is, the money of small profits and quick sales.

If more labor force is taken into account in the profit space of our commodities, the money earned from foreign trade will naturally benefit the general public. A large number of workers engaged in foreign trade production and white-collar workers engaged in foreign trade can have higher income than now, and can also generate more consumption, so as to realize the support of external circulation to internal circulation.

We couldn’t do it in the past, but we can do it now.

Affected by the epidemic in foreign countries, the rate of returning to work and production is not so ideal. Our products are becoming just needed to a certain extent. At this time, we are still pressing the price of our peers and selling them at low prices, which is really cutting meat to feed eagles.

But that is not all.

In order to promote exports, the state will also subsidize export enterprises and implement export tax rebates.

But if we levy taxes on goods, that is to tax foreign consumers; If we subsidize, we will subsidize foreign consumers with domestic financial resources.

Where does the financial money come from? Who does the tax come from?

As mentioned above, in the early days, many factories enjoyed tax-free and low tax treatment, and the money mainly came from the broadest masses of the people.

When we first entered the world market, we were weak and small. We need to stand firm. We can suffer losses and make profits for the future;

Now some of our products have gradually become just needed and become competitive. Do we still need to continue to implement this policy?

The United States has imposed a 25% tariff on China. Originally, American consumers have to bear part of this tax. However, if we still subsidize it, it seems that the United States has won twice.

At present, the situation we are facing is very delicate. Our subsidy policy should be more flexible:

On the one hand, when the economic situation is not good, we should ensure employment. Although some industries can not bring excess income and are not advanced manufacturing, we should subsidize them for the sake of local taxes and local employment;

However, subsidies should be reduced or even stopped for specific countries and industries that we are competitive with. The purpose of industrial upgrading is not to obtain high added value. If the price is still lowered to obtain subsidies, it is a white upgrade.

Maintaining a certain profit margin will enable our workers to obtain more income in foreign trade; Saving some unnecessary subsidies will enable our finance to be used more at home than abroad.

Looking at the trade surplus alone, it may be a good thing. After all, exports are one of the economic troikas.

However, we have made great efforts to achieve the present good situation in export, but we have also paid a historical price; In marketing Chinese goods to the world, we should not only see our achievements, but also see the game between labor and capital, and between China and foreign countries.

Export is not the ultimate goal, nor is the economy. It is the goal of everything to make the people live a better life.

Digression: Here I would like to respond to the question that foreign trade data are false.

First, “Statistics around us” is not advisable.

What is “side statistics”? This sentence is the best example, “many people around us have poor business and the efficiency of the factory is poor. How can we have such a good surplus?”

First of all, many factories do not engage in foreign trade, or foreign trade is not their main business in the first place. If they are mainly engaged in domestic business, the favorable balance of course has nothing to do with them.

Second, even those who are mainly engaged in foreign business are divided into different industries.

According to the statistical results, the fastest-growing industries are automobile, lithium battery, photovoltaic and electromechanical products. If they are not in these industries, the economy will probably not be felt. If you want to find examples around you, you must first be specialized in foreign trade, and then you must be in a specific industry.

Second, logically speaking, it is the stupidest way to choose foreign trade data to be false.

Foreign trade data can be compared with other countries. For a simple example, a person can claim to own 10 suites, but it is difficult to verify if he does not check his account; However, he claims that Ma Yun owes him one hundred million and XX bank owes him one hundred million, which is very easy to prove false because others can easily come out and face him.

We can suspect that the export data is falsely high, but there is really no need to make a record high data, because when the major industrial countries have deficits, you can make a record high, and others can spread rumors about Xinjiang cotton. If this data is rich in moisture, many countries would have jumped out to face it.

Finally, I would like to say, is it true that a huge country, a country with the second largest economy in the world, must have no lighting point?

Good foreign trade data is one of the few good things at present. If our country can’t do anything, what can ordinary people do? It is the most correct attitude to seek truth from facts and not to cover up.

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