[Reprint] breaking the myth of the "China model" _ fantasy

Original address: exploding the auto accident attorney myth of the "China model" but the author: "China's mode-to break the" myth 2010 25 Decembekansas personal injury attorney r 21st century economic report, Dean of the Faculty of Economics Tian Guoqiamedical malpractice lawyers new yorkng "mystery" and special 30-year reform and opening up great success speaks for itself. However, because the market reform and opening up enormous fired out of kinetic and potential energy, just like a rocket launch is being high speed, although there are a lot of internal and external resistance and friction, the positive effect is much larger than in the process of transformation of the negative effects of various issues, including Government-led economic development and social governance lead to negative effects. The resulting many theoretical and practical in many deep confusion and misunderstandings and wrong. Some short-sighted people, or people with vested interests will mistake resistance when power, mistake brake when the throttle, mistake disadvantages when benefits, so that the cart before the horse, specious arguments. For example, will China reform success to Government-led economic development path, social management and political governance, so that have found a modern developed distinct ultimate development model, that is, some people claim that "China model", a "fatal conceit", wrongly "sub-optimal" when "optimal", wrongly transitional arrangements as the ultimate sexual system. Thus, the policy prescription is continually weakening the restrictions of free and open-type reforms, decentralization is continuously expanding Government size, increase government revenues, increasing government intervention in the economy and monopoly, spare no effort to advocate for Government-led economy, leading to government administrative system reform and the reform of the political system, resulting in a country trying to enters the people back and enriching the poorest countries. Since the Government in economic development and social governance in the dominant function is strengthened, on rent-seeking and many officials of corruption has not been effectively curb, become the gap between rich and poor and social injustice in the increasingly serious problem, causing serious problems of efficiency and equity. Also, simply pull the investment through material resources and not focus on the economy, development of human resources, which led to the stagnation of human capital in return. However, many people are not aware of all these problems are basically due to the governmental power is too large, interfering too much taxes are too high, making the Government and market governance boundaries are not reasonable definition, but that is not enough, the tubes with expanded Government powers want approach to resolve the contradictions, the result must necessarily form a vicious circle. For example, in economic policy, blindly believed in Keynes's macro-economic theory, resulting in administrative authority intervention of unabated, market allocation of resources and the basic role was severely weakened. These paradoxical perspective is from different aspects of the interference with the market, democratization, reform of the rule of law, serious interference with the Chinese reform should follow the directions. If all Government-led governance thinking not to be reversed, it is possible to slide into the powerful capitalism of mud, reform and endophytic is lost. These institutional conflicts are rendered out in various ways, so that the development of contemporary Chinese encounter profound bewilderment. To the "left" or to "right" might go in the wrong way, the back and no way out, only to continue to move forward. Therefore, the need for further emancipate, untangle reform continue to maintain awareness and a sense of crisis, the consensus of the condensed reform and endophytic power to effectively promote the reform and opening up. In this sense, China to achieve deeper reform breakthrough and development and innovation, must also be further accelerate economic reform, as well as the corresponding administrative system and the reform of the political system, which should be in the next 30 years of reform and opening-up of important agenda is truly fundamental modernization of long-term stability and security. Premier Wen Jiabao was established in Shenzhen Special Zone 30 anniversary speech, stressing that "not only to promote the economic structural reform, and also to promote political reform, there is no guarantee of political reform, economic reform results will be disappointment, modernization objectives cannot be achieved". In fact, Deng Xiaoping in the early 80 's was on this had a brilliant exposition: "not to reform the political system, we cannot guarantee the outcome of the economic restructuring of the economic structural reform, will hamper the development of the productive forces, impede the realization of the four modernizations. "" To political reform mentioned schedule. " Some scholars believe that the existing economic theories cannot explain the Chinese economic reform 30 years of successes, which have always been mainstream economics profession as the mystery of China's reform. The mystery of the "China" is regarded as the "special" in one of the economists. Actually, China reform can apply the basic principles of modern economics, analytical framework and its internal logic to interpret. We believe that China's reform principles with modern economics is fully compatible. In the early days of reform and opening up, China's original planned economic system, the need for reform to achieve development, but the introduction of a new reform measures or institutional arrangement must have the feasibility and enforceability, meet the objective constraints, but can also be implemented risk control to as small as possible, not likely to cause social and political and economic turmoil. This actually involves "system reform and economic development should first start of" interaction problems. Needs underlines that, in recognition of the constraints of the utmost importance at the same time, it cannot but be combined analysis with constraints,. Many people on national conditions, the constraints of a great misunderstanding that on market reform, on democracy and the rule of law are excluded, and thus against the administrative and political reform of the system. The most common misunderstandings there are two terms: first long-term constraint, rigid, static. In fact, in the long term, with the deepening of economic development, constrained boundaries and participatory conditions are constantly passing and the expansion of its boundaries. Many 30 years ago inconceivable things that today seem not to makeIssue. Democracy and the rule of law, as the socio-economic development and the improvement of people's living standard, the country has slowly evolved it on democracy and the rule of law such a spiritual and political cultures in need will become more and more powerful. Second is confusing principles and methodological issues. Democracy and the rule of law should not, certainly, this is a matter of principle. As for how to achieve, this is the way to approach the problem. Because the so-called special national conditions, without abandoning the principle, this is clearly not desirable. However, the target is not equal to the process, democracy and the rule of law is not a Ben-available, you need to discuss and explore the need for a process and the use of appropriate methodology and steps, step by step to achieve, but this does not mean that you cannot do. Reform and opening up 30 years was a great success, now with social stakeholders in diverse, complicated, contradictory interests of intensification, reform has already crossed the Pratt and Whitney of Pareto improvement phase, further deepening the reforms inevitably violate some vested interests, including the Government's own huge interest. In this context, to ensure that the reform farther forward, both need to meet more participatory and incentive compatibility constraints, more government administrative system and to complete the reform of the political system. First of all, why there will be a so-called "Chinese model" fallacy? this is because the Chinese from the seclusion of the after planned out, internal reform and opening up to the firing of kinetic energy and potential energy is very large, the positive effect of far more than the Government-led economic development, social governance lead to negative effects. Thus, some short-sighted people, or people with vested interests will mistake resistance when dynamic, dynamic friction when the mistake, mistake brake when the throttle, mistake disadvantages when benefits, very satisfied with the status quo, to reform and endophytic dynamic consensus greatly weakened. Second, why is that in the long run to government leadership as the core argument of the "China model" is not desirable because the Government's direct intervention in the economy and promote economic growth, may unknowingly gradually built up a considerable number of economic contradictions and social risk, many people are like frogs in lukewarm water, ignorant. Once again, from the perspective of economic thought, Keynes's Government intervention and with much bad, was shot in the arm, is a hormone that can only serve to headache, curing foot while foot pain ", is not based on a comprehensive treatment of general equilibrium. To establish a mechanism to achieve lasting political stability, or should take Adam �� Smith, Joseph Schumpeter, Hayek's free-market ideology, blochwitz incentive mechanism design to solve the problem of market and government failures. Adam �� the Smith from the perspective of a valid configuration demonstrates the optimality of the market; Joseph Schumpeter from development and dynamic point of view, justify the market instead of government best able to stimulate innovation and entrepreneurship, innovation and entrepreneurship are the economic impetus for the sustainable development of the core; and Hayek from information and motivation of a market system better than the planned demonstration system, blochwitz further proof that the market is the only use for at least the information, and the resulting resource effective configuration of institutional arrangements, and it is because of information asymmetry, the need to adopt incentive mechanism design to solve the problem of market and government failures. The Economist's deep thoughts on China's future reform are essential. Power to enrich people, protect the private first limited public right then, how to and the modern world power development of general law and China's own historical situation on the basis of specific national conditions, a Chinese characteristic of modernity, achieved? author believes that this path has its inner logic of Economics, namely: to enrich the country, we must first; to enrich people, will give private rights; protection of private rights will be limited to public rights. Demonstration against pushing back, through the establishment of a limited and effective Government, national capacity building powerful, empowering and protecting individual freedom of choice, private ownership of property rights and personal rights to survival. Then, based on individual voluntary exchange-led, market-based economy will be able to at least the cost of information resources of the valid configuration so that the economic vitality and creativity, achieving economic prosperity and wealth, the country's political and economic strength. ��ǿ����ȸ��� This is from thousands of years in China and the world's powerful practice lessons in basic conclusions. Numerous individual pursuit and create wealth and make yourself rich, country will be strong, be it the Chinese Han dynasty wenjingzizhi, Qing Qianlong or now of reform and opening up, or the practice of power in the United States have different degrees, illustrates this point, on the contrary, it would be impossible to succeed. Of course, this does not deny that in a crisis or special situations, individuals will exhibit altruistic tendencies or dedication. ���񣬱ظ�˽Ȩ�� This is the only correct way to enrich. As a social and economic constraints by personal axe to grind, subject to resource constraints, protected by asymmetric information, to implement enriching, you must first give the private rights, and based on voluntary exchange of market economy, in order to achieve economic prosperity. The so-called private rights, broadly look mainly into three areas: the protection of the rights of ordinary people economically free choice, have the right to private property rights and the granting of protection, as well as the basic right to life. To enrich, first to give ordinary economic full freedom to choose. Analysis of China's economic reform success stories, thousands of important, important, give people a million more economically most important freedom of choice. From rural to urban reform practice shows that where policy a loose, where a greater number of degrees of freedom, where economic efficiency is higher, resulting in substantial income. To enrich, while also giving people the right to own private property rights and protection. The so-called private property, refers to the exercise of certain rights of individuals when it excluded the other person to exercise the same rights, it is a guarantee of economic freedom. Thus, the definition of property rights is clear. China's economic development has been such a huge success, its fundamental factor is the private economy became the main body of the Chinese economy. To maintain the long-term sustainable development of China's economy, basically, is to further develop non-State-owned enterprises, in particular privateAnd private enterprises, that is the economic development of the basic way for long. In addition to the above two points right, but also to protect the rights of people's basic survival, which is achieving social harmony and stability, thus ensuring that the economy is a necessary condition for the smooth development. Due to their limited or opportunities, will make some people cannot survive in the competition, then you will need for the Government and social protection, to protect each individual's right to life, society would not be stable and orderly. Without a stable social environment, economic development could not be obtained. Therefore, "development is the last word" and "stability overriding" is one of two sides, closely related. Once individuals have these three private rights, giving them adequate competition, voluntary cooperation and voluntary exchange, even if not decided in advance of any arrangement, according to micro-economics in the economic nucleus (economiccore) limit theorem, in very general technical conditions, the results are also available and competitive market as the result of configuration, thereby achieving an effective configuration of resources. So the market mechanism is not a human invention, but rather an intrinsic logic of social selection results, is the common wealth of humanity. As Deng Xiaoping brilliantly pointed out, the market economy is only a means of capitalist countries, socialist countries are also available. ��˽Ȩ�����޹�Ȩ�� This is to protect the inner logic of private rights, and is also the result of many African and Latin America and other regions of the developing countries are facing or experienced development trap for our lessons. Personal freedom to choose, property ownership and rights of real life, the effective operation of the market economy, not solely rely on simple laissez-faire, nor is it solely rely on simple democratic politics. To ensure that individuals have real freedom and property rights and contracts be strong protection, there must be a finite but strong Government, it is necessary to prevent from Government to private rights violations, to prevent private rights are violated, and to ensure that the Government in the maintenance of basic legal order, social order and economic order of authoritative unlimited anarchism, prevent, protect against external faire aggression, safeguarding national security and stability. So to protect the personal freedom of choice, on the one hand, to limit the Government action to restrict government into competitive areas, restrictions on private choice and Exchange, property of interventions and practices that prevent government sector itself become a reform of vested interest groups, the establishment of limited Government and effective Government. On the other hand, the Government must also have sufficient strong national capacities to carry out the necessary regulation of the market and improve the market rules, maintain market order, prevent private rights between solve against each other, including the public supplies of "free riding" behavior, externality problem of power against and protection; by providing education, health, unemployment and other social security system to safeguard the individual right to a fair participation. Therefore, it is necessary to safeguard the rights of the individual, it is necessary to limit the authority of the Government to enable it to be at the same time as, in the context of limited Government also has a powerful national capacity. The Government's limitation to ensure that the right not to be public rights violations, and powerful State capacity is able to protect the private rights and national security and stability. Limited only Government is what, then, to establish a limited Government? modern economists and a consensus of the jurists is, depends on the rule of law (rule of law), rather than a rule (rule bylaw). From the rule of law to the rule of law is further promoting reform and opening up the need to achieve a major leap forward. The modern market economy is the rule of law and economic in nature. The rule of law is a modern nation-building good market economy for the system based on the modern market economy system different from the traditional market economy system in one of the basic features. The rule of law in the first role is to bind the Government on economic activities of any intervention; if the Government from legal restrictions, independent of the free enterprise system and the transaction would have been no fundamental safeguards, the foundation of the modern market economy will no longer exist. The rule of law in the second part is the constraints of the market economy, including defining and protecting property rights, contracts and law enforcement, maintain the market competition. On economic development, the most important is that the contract to be performed, the property to be protected. So to guarantee the rule of law, what is it? is democracy. To build a good rule of law system, we need democracy as a guarantee. Although democracy is essential for economic development or sufficient condition, but democracy is based on the rule-setting (not implemented) majority, most respected on the basis of the principles of minorities, the General guarantee law fair and reasonable. The rule of law has itself cannot resolve the problem: who will supervise the enforcers? how to enforcers of law enforcement? if enforcers itself is not subject to legal constraints, the law only ruler used to restrict the public, such a society would be called a rule of law society, but the legal community, namely the rulers to law to control others in the community. In this State, the rulers of their own can not subject to legal constraints, independent of the authority of the law, enjoy the privilege of non-compliance with the law. The ancient "punishment is not the doctor," judicial philosophy, China is not in the feudalism period and the rule of law, can only be regarded as the national legal system. The rest of the world are also in the feudal period, and the market economy is not compatible, so the modern market economy countries are obliged to by law to the rule of law. So, how can we restrict the law enforcers, become the rule of law that is democracy. Democracy can be restrictive law enforcement, prevent the rule of law enforcement who become predators, fundamentally guarantee the rule of law, that is, the benefits of democracy. However, democracy and what guarantees? on decentralization, separation of powers guarantee a certain degree of democracy. Specifically, including government departments, and subordinate Government scores between decentralization, separation of Government and civil, as well as civil internal, different groups and different people, that is, between the separation of powers does not let the wealth and power is concentrated in a minority or interest groups. Decentralization is key to guaranteeing democracy. Beginning of China's economic reform proposed"Facilitation, decentralization" is a decentralized reform, it greatly enhances economic efficiency, promoting China's economic development, to subsequent market reform to create good conditions, a solid institutional foundation. Why decentralization? is based on the information and encouragement. Because of the economic activities of information often is not symmetrical, hence the need to adopt decentralized decision-making. Based on the above analysis we can see that the modern State system as a whole, from the long-term economic development, the rule of law, democracy and decentralization a ring for a ring, three are indispensable. Last decentralization by? why decentralization? rely on the freedom to choose, free cooperation and competition! its end, the most fundamental reason is that there is currently no ideological level is so high, in General, basic is selfish, still focus on personal interests, in order to arouse enthusiasm, you need to give people as much of the economic freedom of choice, while keeping them fully competitive, so by Deng Xiaoping's words, China is still at the initial stage of socialism, need to engage in the market-oriented reform, taking the Socialist market economy. Deep understanding of the inner logic of the reform and opening up and the "China model" of real harm, it is not difficult to get a basic judgment: China reform has entered into a "sham". The Government is the source of the problem, nor is the answer to the question, its own functions must make significant changes, from a long-term point of view of political reform also have great need. But its so, Government, market and society in the boundary between reasonable can be redefined and define clear, nor is it possible to economic liberalization, social law, political democratization roads significantly forward. In the early stages of economic development, democratic political system might not be able to give developing countries a catch-up path of developed countries, but centralized political system also have great risk, so when a certain level of economic development, democratic political systems more conducive to economic lasting and stable and sustainable growth. However, political reform is a systems engineering, not an event, we cannot stop, to have an entry, the entry can be started from the administrative system. In the existing constraints (including participation constraints) and the development of the situation, the change of government functions can do and must do. Therefore, the next step in the reform of key government functions of two fundamental changes that the change of government functions offside, vacancy and dislocation co-exist, promoting Government from competing with the Government to the development of public-interest service government transformation, from administrative intervention too many omnipotent Government to let the market play its full part in the transformation of limited Government, and thereby the establishment of an effective and efficient market, so that it can simultaneously achieve efficiency, equity and harmony, realization of scientific development. In short, is the qualitative change from development-Government transition to service-oriented Government, from soy Government to limited Government changes. These two fundamental change is the end result of political reform, should become the next reform of primary agenda. (Articles are deleted, the text, see forthcoming the comparison of 50 period, the writer is Tian Guoqiang, summer jijun, chenxudong)