The new crown pneumonia has caused huge damage to China and the world economy.
In the beginning, people watched the fire from the shore, but confirmed cases have spread to all continents except Antarctica. The outbreak on February 26 saw many unexpected "inflection points"-the number of confirmed infection cases outside China exceeded that of China for the first time.
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Both South Korea in East Asia and Iran in West Asia have become the new "hit areas." Outbreaks have also surged in many towns in northern Italy. The state of Washington in the United States has entered a state of emergency. In addition, confirmed cases have begun in Africa and South America.
The World Health Organization (WHO) requires countries around the world to be prepared for the epidemic; the United States has directly warned that the global outbreak of the epidemic is "unavoidable", but sooner or later.
On the one hand, we must fight the epidemic, on the other hand, we must protect employment and economy.
In the past, the thinking was based on the Keynesian tradition, and large infrastructure projects, such as the "four trillion" after the 2008 financial crisis and the Wenchuan earthquake.
As of March 2, at least 11 provinces in China have released investment plans for key projects in 2020, with a total investment of nearly 30 trillion yuan. It is estimated that by the end of the week of March 8, the total planned investment amount will exceed 40 trillion.
I will not say much about the research work on large infrastructure.
However, this time, and the last time, the external environment and the internal environment have undergone tremendous changes, and the "big infrastructure" alone is not enough.
It should also be complemented by a "new infrastructure" and "new domestic demand" system with "National Consumption Code" + "DCEP Digital Currency" as its core .
What is the "National Consumption Code"?
For each adult Chinese citizen, they will receive a RMB-denominated consumption quota issued by the Chinese government every month. They can only scan codes at certified consumer places (such as supermarkets, vegetable markets, restaurants), or at certified sites. E-commerce channels to brush their face consumption. The consumption quota of each citizen is periodically cleared (end of month or quarter) and cannot be transferred.
The national consumption code is only the user interface, and the middle and backstage is ABCDE, which is AI artificial intelligence, Blockchain, Cloud computing, Data big data, and EPayment electronic payment . These five weapons are combined to form a new generation of national governance infrastructure. .
What about the elderly or disabled people who ca n’t scan the phone?
Thanks to WeChat and Alipay's money-burning red envelope battle, my mother will use the scan code to pay almost eighty. Very few elderly or disabled people are authorized by the community or grid to purchase and deliver to the door. Take Wuhan as an example. Nowadays, uncles and aunts are grabbing red envelopes in the community's grocery shopping group. They don't have to worry about the learning ability of Chinese people at all.
What are the benefits of the "National Consumption Code" compared to Hong Kong Discovery Gold and Macau's e-coupons?
In response to the epidemic, on February 26, the Hong Kong Financial Secretary announced the 2020-21 fiscal year's "budget", which includes one item, the distribution of Hong Kong permanent residents aged 18 and above to 10,000 Hong Kong dollars (about 9,000 yuan), It is expected to benefit about 7 million people.
Earlier, on February 13, Li Weinong, the Secretary of the Economic and Financial Department of the Macao Special Administrative Region, said that in addition to the annual cash distribution, after the epidemic eased, the SAR government will issue Macao residents with an electronic coupon of 3,000 yuan each. Consumption vouchers must be deducted in Macao's catering, retail, lifestyle and other industries; the period is three months. Promote local consumption through consumer coupons and boost domestic demand.
First of all, from the perspective of protecting employment and promoting domestic demand, Macau's e-coupons are more effective than Hong Kong's cash discovery.
In the General Theory of Employment, Interest, and Money, Keynes proposed a concept called "marginal propensity to consume."
In simple terms, when a person receives an extra disposable income of 1 yuan, how much of it will be used for consumption. If the marginal consumption propensity is 0.2, it will consume 0.2 yuan; the marginal consumption propensity is 0.8, it will consume 0.8 yuan.
Keynes believes that the value of the marginal propensity to consume is positive, but less than 1, and the more the income increases, the lower the proportion of consumption is. This is a basic psychological law. The same is true in reality. No government has issued 10,000 yuan in cash, and people are expected to spend 10,000 yuan.
In addition to consumer propensity, Keynes also introduced the concept of "multiplier effect". The general idea is that an increase in income will cause the total consumer demand to multiply.
Assume that everyone's marginal propensity for consumption is 0.8. An uncle Mao Jiu receives 1,000 yuan and uses 800 yuan to buy a mask. This is not the end. The uncle Mao Cat who sells masks gets 800 yuan and 640 yuan to buy instant noodles. Food shop owner Mao Qishu received 640 yuan, and bought a game console with 512 yuan …
The consumption chain has been passed on, and the government's cash of 1,000 yuan to a person will drive a total consumption of 4,000 yuan (800 + 640 + 512 + 409.6 + ……).
In economics, the ratio of increased consumption to increased income is called the marginal propensity to consume. This value is usually less than 1. Subtract it by 1 and take the reciprocal, which is called the expenditure multiplier. In the previous example, the marginal consumption propensity of Cat Nine, Cat Nine, Cat Nine, and others were all 0.8 (80%), and the expenditure multiplier was 1 / (1-0.8) = 5. In other words, the increase in national income is five times the government's initial investment. In the example just now, 80%, or 4000, became consumption, and 20%, or 1,000, became savings.
It is not difficult to see that the closer the marginal consumption tendency is to 1, the greater the multiplier effect. If the marginal consumption propensity of the entire population rises to 0.9, then a cash red envelope of 1,000 yuan will drive national consumption of 9,000 yuan. Assuming 2000 national consumption can generate one job, issuing 1,000 cash red envelopes to drive 9,000 national consumption will also solve 4.5 new jobs.
The more prosperous the period, the greater the marginal propensity to consume (everyone is more willing to spend money), and the greater the multiplier effect; while the recession, the marginal propensity to consume will be horribly low (everyone is more willing to save).
Under the circumstances that the whole world is pessimistic about the future, if cash is found for the common people, many people will not consume cash and save it. If everyone ’s average marginal propensity for consumption has changed from 0.9 to 0.5, the government has issued 1,000 cash The red envelope can only drive 1,000 national consumption, and it can only generate 0.5 new jobs, and 4 people continue to lose their jobs without work.
Keynesian economics believes that due to the existence of consumption tendencies and multiplier effects, the government can manage the total demand of the economic system through fiscal policies to regulate the economic cycle.
However, the era of Keynes is an era of extensiveness without AI, Blockchain, Cloud computing, Big Data, and EPayment mobile payments. It cannot intelligently and accurately stimulate user demand. "Infrastructure", the method of spreading money through the use of financial institutions such as banks to pay companies to hire labor.
This kind of "big infrastructure and big water release" will inevitably lead to the "Cantilon effect".
Richard Cantillon was the first economist to recognize that an increase in the amount of money would lead to inconsistent increases in the prices of different commodities and factors. He further believes that the different effects of changes in the amount of money on the real economy depend on how the currency intervenes in the economy and who is the holder of the new currency. This was later referred to as the "Cantillon Effect".
According to Cantillon's theory, changes in the supply of money and credit have a significant impact on the economy through changes in relative prices. Currency increment does not affect all prices at the same time at the same time, but spreads like a stone in the water, so it affects the economy. Depends on the method and channel of currency injection. Additional currency is not necessarily beneficial to everyone. On the contrary, this may be accompanied by a redistribution process. The people who get the money first will push up the price of commodities and cause inflation. For other people in the society, the inflation policy is a kind of predation against them. Then through the economic cycle process, the redistribution of income is completed.
Or, in the words of the common people, the director and the president's little sister-in-law contractor will make a fortune again. Contract workers have too much money to eat and drink? Either buy a big house in Beijing, Shanghai, Guangzhou, Shenzhen, or Shenzhen to drive up house prices, or exchange it for dollar capital flight through an underground bank. Or higher and more exaggerated is Wang Jianlin's "money goes abroad, debts stay in China".
This situation is not the original intention of the Chinese government, nor is it the result of the satisfaction of the Chinese people.
Therefore, only by distributing the "money that must be spent in the current period" to every adult Chinese citizen fairly and transparently, can we reduce the "Cantillon Effect" and reduce the inflation caused by the large infrastructure "poor poverty" "Jifu".
Why does "National Consumption Code" combine big data, artificial intelligence and DCEP China's national digital currency?
For ordinary people, their experience of using the "Consumer Code" is exactly the same as that of WeChat scan code and Alipay scan code, especially it is very similar to the medical insurance scan code function on Alipay, except that Alipay medical scan code can only be used in hospital drug stores The "National Consumption Code" can only be consumed in designated types of scenes such as supermarkets, vegetable markets, restaurants, etc. There is no difference in user experience.
However, just as "medical insurance cashing" is a gray phenomenon that cannot be completely eliminated, neither can the "consumer code for all people" completely stop the scalp party that "cash without consumption". When we design the system and implement the technology, we can try to raise the cost of violations and crimes of the "Bull Party" and "Cash Out Party" as low as possible.
First of all, the "National Consumption Code" is a real-name non-private consumption. The consumer, payee, and consumption details are recorded on each occasion, plus data such as mobile phone model, geographical location, IMEI, and base station information. It is even possible to force the scanning code payment image record to be kept every time consumption (random random inspection in actual operation to reduce the amount of data).
With these raw data for cross-comparison, big data artificial intelligence will be used. The consumption data of the "Buffalo Party" and "Cash Out Party" can be easily identified, supplemented by partial manual inspection and review. You can "don't wrong a good person, but you won't let a bad person go".
What is the role of DCEP's national digital currency system in China? From the perspective of blockchain technology, the funds circulating in this system are traceable and can be frozen in the whole process, even if the "ox party", "cash party" or even "hackers" have found a hole and want to grab When they ran, they couldn't easily carry out "money laundering" or "transfer abroad" of illegal income. Because all agencies and individuals who help to commit crimes on this chain can be easily identified and located by auditing, the deterrent effect is obvious, the cost of crime is greatly increased, and the probability of collusion and conspiracy inside and outside the system will also be greatly reduced.
ABCDE, also known as AI artificial intelligence, Blockchain, Cloud computing, Data big data, EPayment electronic payment, these five weapons combined, even if you can not completely avoid the "ox party", "cash party", you can also The nation ’s marginal consumption propensity has risen to the level expected in advance.
In other words, after gaining experience in the initial trial operation (such as first trial of Wuhan or Hubei People ’s Consumer Code), the government can estimate in advance how many points can increase the employment rate before putting in the “Public Consumption Code” quota. The data can be used to flexibly adjust the investment quota, instead of falling into the quagmire of the "welfare state" or "middle income trap" and raising a bunch of lazy men.
It is written here that it seems that the full name of "National Consumption Code" should be "National Consumption Employment Code", but the cause and effect relationship of "consumption domestic demand stimulating employment" is clear, especially now that the export of external demand stalls and the marginal effect of infrastructure investment diminishes. Under the assumption that ensuring domestic demand is guaranteeing employment and maintaining stability, it will become the consensus of more and more people.
Since I published the article "Smart Socialism and Shenzhen Digital Government Digital Currency Pilot Demonstration Zone" on August 28, 2019, the international and domestic political and economic situation in the past six months has allowed ABCDE's five weapons-supported "national consumption code" to enter At the "arrow on the string" stage, if the implementation can be discussed at an early date (the Wuhan or Hubei People's Consumption Code will be tried first), the country will be fortunate and the nation will be fortunate.
There are still some issues that have not been analyzed in detail in this article. If you have any comments or suggestions, please leave a message. I will modify and add it in subsequent articles.