The Causes, Behaviors, and Termination of Administrative Monopoly in China / Sheng Hong et al

Note: Recently, the authorities is talking about “anti-monopoly”, but the target is not real monopoly, that is, monopoly created by the administrative departments of the government. On administrative monopoly, we have done in-depth research in 2013, and updated the data and revised it in 2015. The title of the research report is “the cause, behavior and elimination of China’s administrative monopoly” (Second Edition). Now I issue the abstract of the report again. ( December 19, 2020)

鲨鱼

The Causes, Behaviors, and Termination of Administrative Monopoly in China (Second Edition)

by Sheng Hong, Zhao Nong, Yang Junfeng
May 10, 2016
Abstract

In short, the “administrative monopoly” is a kind of monopolies established by the administrative departments. The definition of Administrative monopoly is that an administrative department, through issuing administrative documents (such as regulations, statutes or suggestions), grants the monopolistic power(s) to business agents–enterprises or profit-making administrative bodies, which are realized as accessing to exceptional facilities and advantages, forming different degrees of monopolistic forces and the status of the situation by setting of barriers to entry and regulating prices.

Granting the monopolistic powers to enhttps://mp.weixin.qq.com/s/QDkE4kS-d01IjYaDPCh0QQterprises is important economic decisions and a change of basic economic institutions (the “socialist market economy”). Under the Law of Legislation, monopolies shall be established by the legislature. According to the principle of law reservation, monopolies, without establishments of legislature, are the damages to economic freedoms of potential competitors and choosing rights of consumers. In practice in China, most of administrative monopolies are established by formal files of administrations. This situation is a kind of self-granted. The monopolistic powers established by the administrative public powers are unconstitutional and illegal at some level.

Broadly, the Administrative departments use their superiority over drafting legislative acts to establish monopolistic powers in favor of some enterprises through a weak legislature, also regarded as administrative monopoly. Since reform and openness, China’s constitution has been amending several times. There are great changes in its fundamental principles, such as adding principle of “socialist market economy”, and that of “that the state encourages, supports and conducts non-public economy”. The laws including content of administrative monopolies are violated from the principles of constitutions.

Almost all of the main administrative monopoly industries discussed in this study is evolved from the complete planned economy. After years of fiscal system reform, the Central Government’s main sources of revenue have become taxable income. Central Government has incentive to reform state-owned enterprises but no incentive to abolish the monopolistic powers. Instead, granting administrative monopolies as preferential policies to State-owned enterprises could be a way to reduce the fiscal burden from State-owned enterprises.

With the success of China’s economic reform, huge domestic markets came to the fore, which in turn highlighted the value of monopolies on these markets. Because the enterprises with monopolistic powers do not need to hand in profits, and have no ceilings on the level of wages and bonuses, they keep all the profit due to administrative monopolies. As interest groups, they have sufficient motivation to strive for greater administrative monopolies.

“In-house Lobbying” refers to the behavior that top managements of State-owned enterprises get administrative monopolies through lobbying administration officials. One of the factors is that industry officials and executives in firms can transform identities; mutual access to each other’s serving area. This is an important indicator of the administrative monopolies of industries. It appears in several industries in our research.

The above “In-house Lobbying” successes because of the existence of “departmental legislation.” The existence of “departmental legislation” is because under the political structure of China, the lacking of practical constraints for administrations leads to the administrative departments, beyond their authorities, influence legislation both directly and indirectly. The so-called “departmental legislation” is administrative-led or even manipulated legislation. Broadly, “departmental legislation” also means that the administrative departments practically make or amend the laws.

The administrative monopolies perform as setting barriers to entry and regulating prices, while the latter can be divided into two categories. One is sellers’ price- regulating; the other one is buyers’ price-regulating, leading to the owners of administrative monopolies may obtain resources and other inputs at discounted even zero prices.

As long as the institutional barriers to entry exist, even if the other conditions are the same as perfect competition, under some level of demand, administrative monopolies may lead to high prices, low production and welfare losses.

Monopolistic, high prices caused by administration’s setting barriers to entry redistribute the original consumer surplus to corporate profits. It is an unfair distribution of income distortions. If using the monopolistic profits as the way which market decided, they can produce a certain number of products. The value of these products (in broad terms, can also be combined with consumer surplus) is the opportunity loss caused by administrative monopolistic (distribution of distorted part), known as social welfare losses.

Buyer’s price regulating (low or zero factor prices) is a serious distortion of income distribution. It transfers huge wealth which originally belonged to the State or other economic agents to the State-owned enterprises. It is clearly unfair. We assume administrative monopolies use the rents that they miss to pay to occupy more factors of production such as labor, land and capital. If these rents were used in other ways that determined by the market, they can produce more products. The value of these products (can also be combined with consumer surplus) is opportunity losses caused by distortions, also known as social welfare losses.

Administrative monopolies transfer wealth in the form of currency from consumers to the monopolistic companies (including their management and staff), which did not use these monetary resources to produce a quantity of products they should do. Take the perspective of society, a large sum of money does not have corresponding product, which will inevitably promote inflation.

In recent years, adjusting the deposit reserve ratio, rather than adjusting interest rates, increasingly becomes the primary means of implementing monetary policy. Frequency of adjusting is very high. It is up to 10 times a year (in 2007). Adjustment range is up to 14%, so that the highest rate is 21.5%. This is “unusual”. From the point of view of bank, adjusting the reserve requirement ratio and interest rates has a noticeable difference. In particular when implementing tightening policies, increasing reserve ratios will enable banks to avoid the huge costs of raising interest rates.

Because public powers are integral factor of administrative monopolies, and impetus of governmental departments in the formation, maintenance and strengthening of administrative monopolies, credibility and authority of the relevant administrative departments were considerably weaken and undermined, while administrative monopolies damage economic efficiency and social justice. Therefore, state-owned enterprises and their control over the national economy (in fact, is the administrative monopolies) is the real “threat to ruling” rather than “ruling basis”.

Figure of welfare loss and distribution distortions caused by administrative monopoly

FigureThe deep grey part in the figure is the net loss of social welfare caused by administrative monopolies, we called it “social welfare loss I“; The light grey part in the figure is distribution distortion cause by sellers’ monopolistic (regulating) prices, we called it “social welfare loss II“; the grey part in the figure is distribution distortion caused by buyers’ monopolistic (regulating) prices (lower or zero resources prices), we called it “social welfare loss III“.

Estimation of Social welfare loss I: the net social welfare losses of China Telecom, China Mobile and China Unicom from 2003~2013 is about 93 billion RMB. From 2003 to2013 the cap of net welfare loss of telecom industry is about 573.6 billion RMB, and the net social welfare losses of oil industry is about 1969.6 billion RMB.

Estimation of Social welfare loss II: The annual administrative monopoly rent of telecommunication industry is about RMB 22.3 billion on average. It is also the amount of transferred consumer surplus. Oil industy of monopolistic profit brought about by high monopolistic prices is about 1328.9 billion RMB. Salt industry monopolistic profit is as high as RMB 17.7 billion per year. This also is the loss of consumers each year. These numbers are the amount of social welfare losses.

Estimation of Social welfare loss III: From 2001 to 2013, the amount of land (for industrial use) rent which CNPC miss to pay is about RMB 250 billion; the amount of land (for gas station use) rent which CNPC and Sinopec miss to pay is about RMB 273.8 billion; the oil royalty they miss to pay is about 560.4 billion RMB; the financing costs which the big three in oil industry together miss to pay is about 392.6 billion RMB. These numbers are also the amount of social welfare losses.

The mean of difference between deposit interest rate and loan interest rate in most market economy countries is in 1%~2%, but the difference between one-year loan and deposit rates is3% over several years in China. This is achieved by lowering 1.5% to the deposit rate. According to average balance of the 2013 national deposit which is about RMB 98.06 trillion, the estimation of the individuals and institutions nationwide interest loss is as high as RMB 1.4709 trillion. It is equal to 2.5% of GDP that year.

Generally, it is still very difficult to purchase train tickets. It implicates there is a general supply shortage on ordinary train. From Beijing-Tibet Expressway and Qingdao-Yinchuan Expressway, we can tell the supply shortage of general railway freight. Especially since 2010, there are frequent traffic jams in Beijing-Tibet Expressway which are over 100 km and up to 10 days. Number of trains on the high-speed railway is lower than designed normal levels, which means the high-speed railway resources cannot be fully utilized. This suggests that on the ratio of investment in high-speed railway to ordinary railway is severely misallocated.

Report estimates that when the number of the high-speed railway trains departed is up to 187 pairs daily, the utility created by unit cost of high-speed railway is equal to ordinary railway. As we know, the busiest Beijing-Shanghai high-speed railway depart only 90-105 pairs of train daily. This means that the decrease in the construction of normal railways, caused by every kilometer high-speed railway constructed, will lead to a net social loss. In accordance with the relevant data, the amount of welfare losses caused by the misallocated resources between high-speed and conventional railway is about RMB 89.7 billion per year.

The total amount of social welfare loss I(including the loss caused by resources misallocation in railway), social welfare loss Ⅱ and social welfare loss Ⅲ caused by administrative monopolies is RMB 2273 trillion in 2013, while the amount of latter two is RMB 1.9911 trillion, which is such a quantity of money without corresponding products and services, and inevitably brings about inflation pressure. Specifically, it will cause inflation by 2.5%, equivalent to 250% of commodity-retail-prices-index inflation that year.

Taking adjustment of reserve requirement ratio as an alternative means of adjustment of interest rates, the Central Bank raised deposit reserve ratios by 0.5% (as of June 20, 2011). The equivalent interest rate change is 0.375%. It can save the banks from paying interest on deposits of RMB 321.7 billion.

Taking adjustment of reserve requirement ratio as an alternative means of adjustment of interest rates, the Central Bank raised reserve ratios six times in 2011, each time by 0.5%. It is equivalent to reduce the interest expense by RMB 1.5623 trillion for banks or their main borrowers.

Although there are some shortcomings in current Anti-Unfair Competition Law and Anti-monopoly Law, there are still some normal content to constraint behaviors of administrative monopoly. The monopolistic behaviors the Anti-monopoly Law defines include achieving monopolistic agreements between business agents, abusing monopolistic positions, concentrating firms for purpose of excluding, limiting competitors. There is a certain chapter in the law to state forbidding “abuse of administrative powers to exclude and to limit competition.”

It should establish “legislation evaded rule” for drafts of making or amending laws to establish specific monopolies. In other words, the administrative departments that related to specific monopolies should not draft Bills. At least it should be drafted by a neutral agent(s) that authorized by legislature. Moreover, the legislature should organize the Committee of experts to consult about the drafts establishing of monopolies for specific industries. Furthermore, the establishing of a specific monopoly should be treated as a single monopoly, that is, we cannot use “category” as the unit to create a monopoly. For instance, it cannot set “national economy related” as a category.

Administrative departments do not have the power to establish specific monopolies. Any administrative department establishes monopoly through regulations or statutes is illegal. Setting up the rules that related administrative departments should evade the drafting of related “implementation details” or “regulations”; or strengthen the reviewing on drafting of “implementation rules” of specific laws to prevent adding the articles related to establishing or expanding of specific monopolies.

The power that administrative departments can regulate the market price should be empowered by the legislature. When an administrative department using its price regulating power, it should be bound by the Price Law, going through fair hearings. In particular, it should differentiate between adjustments of interest rate to implement monetary policy by the central bank and the interest rates of commercial banks, for avoiding regulation of commercial bank interest rates in the name of implementation of monetary policy.

The Constitutional resource of public-owned economy and state-owned sector could be used to monitor and constraint the managements of state-owned companies more effectively. Because public resources and assets should be owned by all people, the supervision of these resources and assets should be strengthened. It must be assured that these assets should not be controlled by managements of state-owned companies. Because it is difficult to monitor public resources and assets on institutional and technological term, it should be emphasized in Constitution, and establish corresponding institutions and rules in laws.

Standing Committee of the National People’s Congress, as a specialized constitutional supervisory authority, can and should review and terminate suspected unconstitutional establishment of administrative monopolies. It should declare unconstitutional and terminate unconstitutional ones in accordance with the current Constitution. At the same time, based on the provisions of existing constitutional law, the Law of Legislation, empowered authorities (mainly as Standing Committee of the National People’s Congress or the State Council) terminate, revoke the existing, various administrative files for establishment of administrative monopolies respectively.

The judicial reform proposals of breaking administrative monopolies including: first of all, allow clients (but is not limited to enterprises) directly sue the enterprises suspected of administrative monopoly; at the same time, prosecution is not limited to request monopolistic enterprises to bear civil liability, but also have the right to request the Court to review the legality of monopoly.

Secondly, emend the relevant legislation, so that courts could have the substantive power to review the cases of administrative monopoly and to dispose monopolistic status.

Thirdly, renovate existing antitrust administrative enforcement mechanisms. The keys are to consolidate on institutions and functions, improve authority (for example, it cannot rely on “recommendations to the superior authority”), and legitimate the process (the core is to ensure a fair, transparent and participatory, not internal operations).

Fourthly, it should establish the public prosecution system to administrative monopolies.

Reformation of breaking administrative monopolies at the administrative level as below:

Firstly, directly encourage enterprises, including private enterprises and state-owned enterprises, enter to the areas which absence of legal provisions of monopolies. For instance, in the petroleum industry, there are only the administrative files, but no legal restrictions to enter. The administrative departments that impede enterprises to entry the industries mentioned above should be imposed administrative penalties.

Secondly, abolition and prohibit self-granted monopolies of administrative departments (or industrial associations controlled by them) by executive orders.

Thirdly, require the Ministry of Finance, the Ministry of Land Resource and other related departments to set up specialized agencies to verify the number of public natural resources  (including land, licenses of mining, etc) occupied by enterprises, and charge rents from resources holders at market prices.

Fourthly, require State-owned Assets Supervision and Administration Commission of the State Council to set a reasonable state-owned enterprises ‘ wage ceiling according to the levels of average wage in society, and punish the people who get wage above the bound.

Fifthly, request the Ministry of Finance to establish specialized agencies to monitor state-owned enterprises, particularly central state-owned enterprises, to give recommendations on the distribution of profit to the State Council, to strict implement the profits surrender, and to supervise reinvested part of profit.

Lastly, promote the state-owned enterprise to withdraw from the profit-making area in the long run.

Power is Short, Dao is Eternal / Sheng Hong

流星

According to the media, the Ministry of Public Security issued the “Regulations on Public Security Organs’ Maintenance of Civilian Police Law Enforcement Authority” (hereinafter referred to as the “Regulations”).It includes such content that “the police perform their duties in accordance with the statutory conditions and procedures, exercise their powers, and cause damage to the legitimate rights and interests of citizens, legal persons or other organizations,  the individual police officers shall not bear legal liabilities, and the public security organs to which they belong shall be given damages according to relevant state regulations. This content expands the power of the public security organs and their personnel, and reduces and invades the rights of citizens. According to Article 82 of China’s “Legislative Law”, “without basis on the law or the administrative regulations, decisions, and orders of the State Council, departmental rules may not set norms that derogate the  rights from citizens, legal persons, and other organizations or increase their obligations, and may not increase the power of the department or the reduction of the statutory duties of the department”, the Ministry of Public Security is clearly a self-authorization of abusing legislative power.

It has been argued that the “performance of duties and exercise of powers in accordance with statutory conditions and procedures” as described here can be interpreted as “performance in accordance with the law.” So, what is the meaning of “law” here? According to common sense, the law is first of all the law of heaven or the law of nature. A country has its reason and legitimacy only because it protects the rights of citizens. This law of heaven is basically embodied in the written Constitution. The core part is the determination of the constitutional rights of citizens, including personal freedom (Article 37), personal dignity (Article 38), expression Freedom (art. 35), freedom of belief (art. 36), the right to inviolability of private property (article 13), the right to inviolability of dwellings (art. 39), freedom of communication and Secrets (art. 40), enjoy fair justice and basic human rights (article 33), criticize the rights of the government and its staff (art. 41), legal rights of the non-public economy (art. 11) ,and many more. The reason why the public security department was established was to protect the constitutional rights of these citizens. The “law” it relied on was first and foremost the constitution. The “Police Law” regards “supporting the Constitution of the People’s Republic of China” as a primary condition for a policeman. Therefore, the “job” of “executing a job according to law” is a duty to protect citizens’ constitutional rights from infringement.

Since “performing duties according to law” is to protect citizens’ constitutional rights, how policemen can “damage to the legitimate rights and interests of citizens, legal persons or other organizations” as the Ministry of Public Security says? This is obviously a constitutional paradox. Being able to “damage the legitimate rights and interests of citizens, legal persons or other organizations” must be a violation of the Constitution and related laws, rather than “performing duties according to law.” “Performing duties according to law” can only make citizens’ constitutional rights safer. Because these “legitimate rights” are protected by the Constitution and laws. Article 21 of the “Police Law” stipulates that “the people’s police shall immediately rescue the citizens if their personal and property safety is violated or in other dangerous situations.” In other words, when policemen see the act of “damaging the legitimate rights and interests of citizens, legal persons or other organizations”, they should be afraid of that they cannot stop it in time, should they also “perform their duties according to law” and “damage the legitimate rights and interests of citizens, legal persons or other organizations”? “If you string together the substantive meaning of the new regulations of the Ministry of Public Security, is it not that when policemen “damage to the legitimate rights and interests of citizens, legal persons or other organizations”, “they personally not responsible for the law”?

According to this reasoning, the “law” mentioned by the Ministry of Public Security in this “Regulations” is not a constitution or a law that conforms to the Constitution, but is otherwise referred to. In reality, we often see police officers calling “law enforcement”, but doing things that violate the Constitution and the Police Law. Once the parties want to protect their civil rights, they say “obstructing official duties”, which has become a routine. There are cases such as, the police breaking through the door in the middle of the night, restricting without reason on the personal freedom of citizens, and damaging to the property rights of citizens; the tens of thousands of mass conflicts caused by a large number of demolitions each year happened mostly under involvement of the police. None of the civil rights stipulated in the aforementioned Constitution is not damaged. Most of these unconstitutional violations have not been punished and corrected, and they also regard these acts as normal. In fact, as a group, the Chinese police have long neglected constitutional education. It is difficult for policemen to consciously implement the vocation of protecting the constitutional rights of citizens, and they more often regard the orders of superiors as “laws.” For example, when a female police officer in Chongqing recalled the days when she was in labor camp innocently, the police of the task group also knew that it was a wrong case, but they said that “the leaders demand that this be done, so what we can only do is doing the wrong case.” It is dangerous to tell the police that they can damage the rights and interests of citizens when they are unable to discern what the “law” they are relying on is, or they know that the leadership order is wrong but they must be enforced.

In the “Regulations” of the Ministry of Public Security, the reason for proposing its new regulations is that “in the past 40 years of reform and opening up, more than 13,000 public security policemen have died for public.” If they are sacrificed to protect the constitutional rights of citizens, we should mourn for them, but this does not mean that we should conclude that if the rights and interests of citizens are damaged, the “personal police officers do not bear legal responsibility” conclusions. Because this is only a unilateral statistic. In the past few years, how many citizens have lost their lives because of the police? The major vicious cases disclosed by the media include the case of that several police officers plotted to kill people in Fuzhou, Fujian Province in 2001, and the case of the killing by 6 police officers in Zhoukou City, Henan Province in 2004. In 2009, the Mengzi County police murder case in Yunnan, the case of police shooting two people in Guanling County, Guizhou Province in 2010, the police shooting the three-person case in Taipu Temple in Inner Mongolia in 2010, the police shooting in Panjin City, Liaoning Province in 2012, Pingnan County, Guangxi in 2013, the police shot the pregnant women, the 2013 Anshun police murder case, the 2015 Inner Mongolia Public Security Director murder case, the 2017 Xinhua County police shooting and killing case, and so on. The most shocking thing is the Lei Yang case. A person passing by the foot washing shop was unexpectedly died, and no police officer was legally responsible for it.

Some of these police murders are in the name of “performing duties according to law.” For example, the Lei Yang case was due to “catching the prostitution”, and the Panjin police murder case was for demolitions, and it was the “law” of leadership. There is also a wider range of police violations of citizens’ constitutional rights. It is carried out under the name of the so-called “legal”. For example, in the period of Bo Xilai’s administration, Chongqing was arrested in the name of “black society”. As many as 4,000 people. Chongqing police abused torture in illegally established “black bases”, including “tiger benches”, “tables”, “duck floating”, “Su Qin back sword”, etc., as well as mental torture, such as the so-called “politics returns to zero” , “economy returns to zero” and “emotion returns to zero”. Many people were sentenced to death without legal due process and 13 people were executed. When some local governments and their officials forced the peasant land, the police were often used to suppress land-losing peasants, causing a large number of casualties, such as the Panjin land acquisition police murdered one person. According to media reports, we have done an incomplete statistics. From 2003 to August 2014, there were 182 demolitions of malignant incidents, resulting in 484 casualties on both sides of the demolitions, 162 deaths and 322 injuries. More vicious incidents have not been reported.

Some people will say that the example I gave is only an individual phenomenon. Bo Xilai is just an accidental situation and cannot represent the mainstream and the overall situation, actually not. All people are mortal. In the absence of institutional constraints, good people will also become bad. What’s more, the facts show that Bo Xilai is not a only bad leader. Zhou Yongkang is another example. He was the main leader of the armed police. From 2012 to 2016, 23 public security system officials were dismissed, including 5 deputy ministerial and above officials. Someone listed a “list of chilling”, ranking 100 senior officials of Public Security System starting from Zhou Yongkang. Despite this, the Central Commission for Discipline Inspection still believes that the Ministry of Public Security’s anti-corruption efforts are insufficient. The key is not whether the leaders of these public security systems are corrupt, but as a mortal, as long as there is no strong restraint on the system, whether they will consciously be loyal to the constitutional spirit and take the protecting constitutional rights of citizens as their top priority. On the other hand, if our police group only regards the superior order as a “law”, it will inevitably lead to violations of the Constitution and harm to the legitimate rights and interests of citizens. And when they follow the orders of the superiors to “execute their duties according to law” and “do not bear legal responsibility”, can it not cause more harm to civil rights?

The new regulations of the Ministry of Public Security also propose that, in the case that the police individual does not bear the legal responsibility of “damaging the legitimate rights and interests of citizens, legal persons or other organizations”, “the public security organs under their jurisdiction shall compensate the damage caused according to relevant state regulations” .This is even more an embarrassing request. Where does “compensation” come from? Is it not the state finance? Where does the national finance come from? Is it not the money of the people? The logic becomes like this, for the damage to the legitimate rights and interests of citizens, the harming person does not have to bear legal responsibility and compensation, but the citizens must compensate themselves. In a society, if the victims themselves compensate their own losses, how can they stop the perpetrators? Can the victims survive if the perpetrators are encouraged? The contracting three rules issued by the first Emperor of Han Dynasty,  “Killer should be die, hurter and theft should be punished according to criminal “The reason why this three rules can stabilize the hearts of people in troubled times is to say the most simple rules: the damager bears the blame. This is the most basic civilized rule in ancient and modern China and foreign countries. The failure of the planned economy tells us how low the efficiency can be when individuals do not bear the consequences of their actions; when the individual does not bear the consequences of harming the legitimate rights and interests of others, the social damage will be unimaginable. What’s more, the police are not ordinary people. They have violent tools in their hands. Once they are allowed not to bear the consequences of damage, policemen will not be controlled by the public security department; the public security department will also not be controlled by the society.

Finally, we must see that this new regulation of the Ministry of Public Security seems to protect the interests of the police. In fact, it is not the case, but the police are placed in a more dangerous situation. If the police do not protect the constitutional rights of the citizens, but execute the order of the superior leadership to deviate from the constitutional spirit, and do not need to bear legal responsibility, it will inevitably aggravate the tension and opposition between the police and the people. When the consequences are caused, the executer is either a scapegoat for the leader or protected by the leader but revenged privately. The facts also tell us that those police officers who execute wrong orders are not good at the end. For example, Chongqing’s “fighting black heroes” in the Bo Xilai period, Wang Lijun did not have to say, Zhou Hao, who was awarded the “Chongqing May 1st Labor Medal”, committed suicide in 2014. “First-class hero”, Tang Jianhua was arrested and imprisoned, and “first-class hero” Guo Weiguo was awarded 11 years of his sentence, Wang Zhi was sentenced to 5 years in prison, Zheng Xiaolin, Yan Hongbo, but Bo was convicted of conviction for extorting a confession by torture. Some people will say, isn’t it because Bo Xilai’s downfall? But isn’t Bo’s downfall just because he issued a sinful killing order? Moreover, if the constitutional rights of citizens cannot be protected, the police’s own constitutional rights will not be available first. Such as the prelude to Chongqing’s fighting black society, is the cleaning of the police force. More than 900 police officers have suffered from it.

Power is short, and Dao is eternal. In fact, for any police or official, the wrong order to refuse the superior leadership’s violation of the constitutional rights of citizens is the safest option for himself. Many criminal police officers always excused themselves by “executing superior orders.” They expect that superior powers will cover them with impunity, but the result is still the punishment that cannot escape the law. It should be understood that their superiors will eventually lose power because they execute the wrong order themselves. Conversely, refusing to execute the wrong command of the superior is a “care” for the superior. In fact, the execution of the wrong command is a kind of sin, which is called “the mediocrity of sin” by Hannah Arendt. She said that this kind of sin is unforgivable because all people can “obey orders” as an excuse to get rid of their responsibilities, so a society is devastated without any personal responsibility. Most societies have rules in place to avoid this. Article 33 of China’s “Police Law” stipulates that “the people’s police have the right to refuse to execute orders that exceed the scope of the people’s police duties stipulated by laws and regulations, and at the same time report to the higher authorities.” I hope that our police brothers will the rights provisions in the Constitution and Article 33 of the Police Act serve as the golden rule and amulet.

Even if you really perform your duties in accordance with the Constitution and the law, you can’t do it casually and you can’t take legal responsibility. Law enforcement also has procedural and methodological issues. From time to time, we have seen cases of violent law enforcement. For example, on May 17, 2016, a college student in Lanzhou was beaten by the police for shooting police brutal law enforcement; on April 17, 2017, four police officers in Shenyang did not show their documents when they arrested suspects without identified the very person. The police beat the person, then found to have caught the wrong person. On September 1, 2017, the Shanghai police tried to stop a woman’s illegal parking and pushed the woman holding the child to the ground and pressed it. And injured the child; on May 27, 2018, Anhui Lu’an teachers demonstrated for salaries and were beaten by the police; and so on. In a nutshell, there is also a question of how to enforce the law. Correcting a traffic violation error, or arresting a suspect is for public safety, if cause unnecessary harm to citizens during the execution process, it violates the original intention of setting up the police. The so-called law enforcement, which does not follow due process and does not take appropriate measures, is still in violation of the constitutional spirit and has caused damage to civil rights. Therefore, this should not be “not legally responsible”.

Finally, what is caused by this “Regulations” of the Ministry of Public Security is actually a constitutional issue. If this “Regulations” can really be established, the Constitution should be amended. This “Regulations” only talks about the rights of the police, and does not mention the constitutional rights of citizens that the police should protect. When there is only one mention about the constitutional rights of citizens, it is assumed that if the damage is done, how the police cannot be held liable. It seems that the police group is a special group that is external to citizens and society. Among other provisions, the “Regulations” extend the scope of application to “being maliciously complained, hype”, and “mistaken accountability or unfair disposition” and so on. What is “malicious”, what is “goodwill”; what is “public opinion supervision”, what is “hype”, not the public security department itself can say the final, but to go through a legal due process to discern the facts. In the reality of our country, having power, the public security department has a practical advantage over other citizens regardless of the law. Therefore, this “Regulations” actually makes the balance slope more to the party that has the advantage. In view of this, the public security department as a department has a very different nature from other departments. The departmental regulations it formulates are not a regulation of the internal affairs of the management department, but have strong external effects. The “Regulations” with such content should not be formulated by the public security department.

If this “Regulations” is practiced, the violation of citizens’ constitutional rights will be several times and dozens of times more than the present. For the ruling party and the government, this is also extremely negative. Because although the policemen are at low position, their behavior and attitude represent the image of the government. Once the government tells the police that they may harm the “legitimate rights and interests” of the people and are not responsible, they will despise the government because of the palliative that even they themselves feel too broad and arrogant, and they may actively abuse the people and cause trouble. Erasmus once said, “Even the most powerful monarch can’t bear the price of anger or contempt for even the most humble enemy.” If the ruling party wants to use such a method to “maintain stability,” it may be counterproductive and further shake the political legitimacy of the ruling party. Therefore, the ruling party and our society still have to correct this wrong “Regulations” in time. Because it has serious content violations of the spirit of the Constitution, I suggest that the State Council can determine that the Provisions “exceed the authority” and “the lower law violate the provisions of the superior law” in accordance with Article 96 of the Legislative Law; And according to the Article 97 of the Legislative Law, the State Council has the power “to change or revoke inappropriate departmental regulations”, and revoke the Regulations. The Standing Committee of the National People’s Congress may also conduct a constitutional review and revoke the Regulations on the grounds of unconstitutionality.

Xunzi said, “God creates people not for kings; but God establishes kings for people.” This tells the source of the power of “king”: Following the Dao for people. Here, “Dao” is the way of heaven, “people” is the public, and “king” is the government. The reason why the policemen exist is because the people need them; if they put themselves in front of people, they need not to exist. This is the law of heaven. The law of heaven is not artificially changeable. If someone think he can change, it is the arrogance of power. The greatest effort of mankind is to bring the artificial law closer to the law of heaven. However, no matter what, human beings have to follow the law of heaven. When the law of man-made approaches the law of heaven, they follow the law of heaven; when the law of man-made departs from the law of heaven, they will be punished by the law of heaven, and eventually return to the law of heaven. The difference is that the former is actively followed, only a small cost; the latter is passively followed, and it has to pay a high price. How much is it depends on when it is corrected.

 

February 5, 2019 in Fivewoods Bookroom

March 11, 2019 published firstly in FT Chinese and China-review Weekly

 

 

【正心诚意】宗教人及其制度含义|盛洪

摘要:人们通常以为,互相制衡的宪政结构是限制权力的完善结构,而忽略了这种他律制度仍然面对无法约束最高实际权力的问题。更一般地,只要存在着经济人,就没有完全有效的他律制度可以无一遗漏地约束权力。我们不得不求助于人的自律。不同于经济人,宗教人超越自我、关心他人与社会,就是一种自律的人。有关宗教心理学的研究表明,通过皈依和修身过程,一个人可以转变为宗教人。宗教和文化传统是产生这种宗教人的重要机制。美国宪政体制的成功,不仅依赖于其制度结构,而且受益于美国国父们的宗教背景和对宗教理想的热诚。这也说明了宗教人在宪政结构中扮演着重要角色。

特蕾莎3

一、问题的提出

对制度结构的考察发现,所有他律的制度都不能完满地制约个人或组织越界侵害别人的利益。如因有外部性问题,公共物品问题和垄断问题的存在,市场制度会失灵。克服市场失灵的方法之一是建立政府。但这在解决问题的同时,带来了更大的问题。因为在市场中,个人交易者之间的差别不是很大,而企业间虽有规模的差别,但没有权利(right)上的高下。而一旦建立政府,不仅其规模巨大,而且有对权力(power)的垄断。权力是一种以公共暴力为后盾的支配力,它因可以限制权利而强于后者。一旦政府失灵,解决起来就更困难。

一个解决的办法是民主。即所有公民都有权利通过投票决定法律和政府领导人,因而会约束政府的越界扩张。但民主也会失灵。如孔多塞指出的循环的大多数,波德指出选举有可能将大多数人最不喜欢的人选出,阿罗指出的投票悖论,布坎南指出的互投赞成票和多数人暴政,奥尔森指出的少数人利益集团更有力量,等等。结果是,一旦政府领导人被选出,他就可能利用其在位掌握实权之便,修改法律以获得更多的权力(如希特勒或查维斯);即使个人权力的扩张受到限制,作为整体的政府的扩张却似乎很难避免(如二战后的欧洲和美国)。更重要的是,一旦民主失灵,利益相关人却不能像退出市场一样退出社会,因为那意味着背井离乡。

据哈耶克,对民主失灵的解决方法是法治,即法的统治(rule of law),而不是人的统治(rule by men)。法治的极致形式就是宪政,就是通过宪法对权力进行制约。然而,法的统治仍然要由人来执行(rule of law by men)。悖论在于,如果要约束权力,尤其是占据权力顶峰的权力,或实际上的最大权力(如军权),是否要有更大的权力?如果没有的话,依据经济人假设,掌握权力的人怎么可能自觉地约束自己?如果有的话,这个更大的权力谁来约束?

更一般地,上述问题可称为个人主义假设的失灵。即如果假设一个社会中全是追求自己利益最大化的个人,不可能存在一组针对经济人本性的制度安排,使得社会中的所有的人得到有效制约,使之不会越过自己权利或权力的边界,损害或侵犯别人的权利,尤其是一般公民的权利。这也就是说,在经济学范围内,即在假定人是理性的经济人基本假设前提下,没有一种制度结构的安排是可以解决约束权力问题的。我们可以猜想,以往认为可以约束权力的宪政,其实不仅是利用了人的趋利避害的本能,而且还有其它因素在起作用。

实际上,经济学家们已经发现了这个问题。如桑塔费学派已经指出,如果仅有自利的经济人,一个社会只能走向崩溃;即使加上弱互惠者,也避免不了这样的命运,因为他们无法阻止自利者违约以自肥的行为。只有演化出强互惠者,即一些不惜付出额外成本以维护市场秩序和契约原则的人,才可能使社会生存和发展(Bowlesand Gintis,2004)。然而,这些强互惠者是如何演化出来的,却没有答案。

布坎南在得出了“一致同意的宪法是最好的宪法”的结论后,进一步问了一个问题,“谁来起草宪法?”他无法用经济学来解释。因为好的宪法不仅对当代人有好处,也会荫及后代。宪法起草者怎么获得后代的回报呢?他因此用伦理学来解释,即具有“宪法公民身份伦理”的人来起草宪法(2008,第153~205页)。他后来把他的理论称为《宪法秩序的经济学和伦理学》。然而,类似的,布坎南没有回答,具有宪法公民身份伦理的人是怎样产生的问题。

因此,我们的问题是,如果我们认定,以个人主义为前提的他律制度不能就约束权力提供完满的功能的话,就需要有自律的制度和个人起作用。这种自律的制度是什么样的,自律的人是如何产生的?即使有自律的人,自律的强度能否抵御权力的巨大诱惑?

二、宗教人

在这里,宗教人是一个广义的概念,也是一个可以应用于经济学中的概念。宗教人不仅包括现有宗教的信徒,遵从类宗教文化传统的君子,而且包括一切认为存在超越个人利害的天道或最高正义的人,他们愿意为了实现这一天道或最高正义不惜付出个人代价。在经济学中,“宗教人”可以拿来与“经济人”相对应。经济人只做对自己有利的事,而宗教人却可能做对自己不利、但对(他认为的)社会有利的事。

更具体一些,宗教人的特点,就是能够跳出自己作为一个凡人的肉身,更超然和中立地看待自己与他人的关系,甚至站在整体的(社会的,宇宙的)立场看待事物。这样,他或她就有可能在与他人发生利害冲突时,不仅从自己的角度考虑问题,而且从他人的角度考虑问题,从而更公正地对待冲突;当一种选择对全社会有利、但可能对他自己不利时,也能够接受和实行这种选择。

很显然,宗教人不仅与自利的人(眼光短浅的经济人)不同,而且与弱互惠者(有长远眼光的经济人)不同。奥古斯丁说,自由意志可以使人选择过善的生活,而不过恶的生活,是因为不可能所有的人采取恶的生活而不受到损害,但所有的人采取善的生活却可以互不损害(转引自黄裕生,2008,第110~111页)。这种“善的生活”也不过是一种的长远眼光的经济人的选择。他们也很类似于亚当·斯密在《道德情操论》中描述的经济人。他们从较长远的成本收益比较中,可以得出遵循道德对自己有利的结论来。不过他们遵循道德的强度是有限的,一旦遵循道德的成本高于收益,他们就可能不再遵循。

即使他们有些看来利他的行为,在斯密看来是出于“自爱”,“一种对自己优秀品格的爱”(p137,转引自科斯2010,第118页)。这种自爱当然是有限度的。科斯曾就亚当·斯密的“亿万中国人的生命和自己的小手指”的比喻设问,如果用自己的小手指去换亿万人的生命,一个有人道的人是否愿意呢?他接着问,“如果不是失去小手指,而是胳膊或大腿,并且他牺牲所拯救的中国人是一百人而不是一亿人,那么,他很可能作出不同的决定。”因为同情与其它行为一样,其“程度依赖于它的代价。”(第118页)

而宗教人则不一样,当他们做他们认为是正确的事情时,就不太在乎是否要承担成本。当然不同的宗教人会随着其“宗教性”的不同而愿意承担不同的代价,从淡泊名利(如孔颜之乐)到献出生命(如耶稣上十字架)。所谓宗教性,就是一个个体从整体出发思考问题。这时的“整体”,包括全部空间和永恒时间。与弱互惠者的区别在于,宗教人的整体是无限的,而经济人的长远眼光再长也是有限的。当用整体眼光看待事物时,就比有限的视野更全面和准确。

那么,宗教人是怎样产生的呢?按孔子的说法,“生而知之者上也,学而知之者次也”。是说有人生来就具有宗教性。但这只是人类中的很少一部分人,大多数宗教人要靠学习和其它宗教启发的方法。这就会存在一个从经济人变为宗教人的过程,通常被称为皈依过程或修身过程。这种转变不是一个无足轻重的变化,也不仅仅是人的一种观念上的转变,而是心理的转变,基本人性的根本改变。无怪乎,探究这一转变是如何发生的,是宗教心理学的重点研究内容之一。

经济人之所以能够变为宗教人,首先是因为每个人的心中都潜藏着宗教性,或孟子所说的“善端”。为什么在每个有着自身利害的个人身上会有善端?这是因为任何个体从一开始就是整体的一部分,在数亿年的个体与整体互动的长期演化过程中,个体中必包含着某种“整体性”。正是因为有着这种整体性,如同有着个体对成本和收益的感觉一样,才会形成复杂的生物,以及生物个体构成的复杂的社会。只是在不同的个体之间,有着整体性多少的不同。

只是通常,宗教性只是深埋在一个人的心中,只有通过一个启发过程,才能显现出来。一般而言,宗教不仅意味着宗教经典,还意味着一套启发宗教性的仪式,经常还有一个组织。这个启发宗教性或善端的过程,不同的宗教或文化传统都有论及。如在王阳明这里,宗教性或善端被比喻为明镜,启发善端的过程就是把镜子磨亮的过程。而遮蔽明镜的锈渍则是“人欲”,即肉身之欲。王阳明说,“去得人欲,便识天理。”即超然于个人利害,就会看到天道或上帝的正义。在基督教《圣经》中,在伊斯兰教《古兰经》中,在佛教经典中,等等,都有类似的比喻。

三、宗教人形成的心理学描述及其意义

现代西方的宗教心理学提供了大量皈依过程的经验案例。如《宗教经验种种》一书中,就引述了不少皈依过程的心理体验。如:

斯蒂芬·布拉德雷:“我的心跳继续加快,很快我就深信,这是圣灵对我施加影响。”(詹姆斯,2012,第144页)

S.H.哈德雷:“我坐在那思考,觉得有一个伟大非凡的东西出现。……到后来才知道,那就是耶稣。”(詹姆斯,2012,第145页)

大卫·布雷纳德:“我走进茂密的树林,一种说不出的荣耀似乎突然开启,为我的灵魂所领悟。”(詹姆斯,2012,第156页)

阿兰:“刹那间,救赎的爱便随着反复吟诵的经文闯入我的灵魂,强烈无比,我的整个灵魂都似乎融化在爱中。”(詹姆斯,2012,第163页)

阿尔丰斯·拉提斯邦:“出教堂时,眼前充满光明。……好像天生的盲人突然睁开眼睛,看到耀眼的白昼。”(詹姆斯,2012,第169页)

……

在中国很有名的艾伟德:“一天晚上,因某种我无法解释的原因,参加了一个宗教集会,在那里,我第一次意识到上帝对我一生有一个要求,我于是接受基督·耶稣为我的救主。”(Gladys,1974,p1)

而经历这个心理过程以后,人就彻底改变了。如:

T.W.B.:“我恢复知觉时,自己正跪着,不是为自己祈祷,而是为他人祈祷。…… 我对自己的关怀似乎完全丧失,让位于对他人的关怀。”(詹姆斯,2012,第157页)

阿兰:“我渴望成就基督的事业,…… 。我对世俗的快乐、世俗的伴侣,完全失去兴趣,因而能够远离它们。”(詹姆斯,2012,第216页)

柳巴教授的通信者:“我把自己完全交给上帝,最坚定地相信,我个人将被摧毁,他将从我这拿走一切,我情愿如此。”(詹姆斯,2012,第219页)

阿尔丰斯·拉提斯邦:“我只知道自己变了,相信自己变成了另一个我。我在自身寻找自我,但是没有找到。”(詹姆斯,2012,第221页)

……

皈依以后,他们的行为就发生变化。

如阿兰即刻成为基督教传教士。“他的一生克已奉公,忠于职守,足以列入最虔诚的圣徒行列。尽管他在拼命工作中获得幸福,却再没有品尝过世俗的快乐”(詹姆斯,2012,第216页)。

再如那位柳巴教授的通信者,他以前酗酒嗜烟,皈依以后就完全戒掉了(詹姆斯,2012,第219~220页)。

再比如艾伟德后来读到了一篇有关中国的文章,决心到中国传教。她后来在中国的抗日战争期间收养和救助了一百多个孤儿,并翻山越岭将他们从山西阳城送到西安(Gladys,1974)。

仔细思考这些皈依的案例,我们不难看到,宗教皈依的过程和结果,就是降低甚至完全取消一个人对个人利害的关心,转变为对他人甚至对社会整体和天下苍生的关心,具体表现为对上帝,这个代表宇宙总体的神圣存在的敬畏和服从;也可以从经济学的角度说,一个人从普通的经济人变成一个宗教人。从而,经济学以经济人为假设前提的分析不再有效。

这种服从上帝,即服从整体利益,而忽视自身利害的精神取向,之所以使经济学的分析变得无效,是因为它可以使宗教人采取完全放弃个人利害的选择,即即使面对死亡也不会改变。如沃依齐先生所说,“假如伤害降临,他们甘愿承担,因为主是他们的保护人,没有主的意志,什么事情都不会发生。假如这是主的旨意,那么伤害对于他们是一种福气,绝非祸事。”(詹姆斯,2012,第271页)

当然《宗教经验种种》只是针对基督教的研究。在其它宗教和文化传统中,似乎还没有成熟的研究,只是有一些记录。如关于王阳明的“龙场悟道”,《王阳明年谱》中有如下记载:

时瑾憾未已,自计得失荣辱皆能超脱,惟生死一念尚觉未化,乃为石墩自誓曰:「吾惟俟命而已!」日夜端居澄默,以求静一;久之,胸中洒洒。而从者皆病,自析薪取水作糜饲之;又恐其怀抑郁,则与歌诗;又不悦,复调越曲,杂以诙笑,始能忘其为疾病夷狄患难也。因念:「圣人处此,更有何道?」忽中夜大悟格物致知之旨,寤寐中若有人语之者,不觉呼跃,从者皆惊。始知圣人之道,吾性自足,向之求理於事物者误也。

也可以看出,王阳明的龙场悟道,也是一个忘却自身利害,而用自己的心直接感悟天道的过程。

实际上在中国,很早就有君子和小子之区分。在这种语境中,“小人”就是经济人,而“君子”则是宗教人。孔子说,“君子喻于义,小人喻于利。”即是说君子重义(天道正义)而轻利(个人利害);孟子说,“生我所欲也,义我所欲也,二者不可兼得,舍生而取义也。”说的是为了天道正义,可以舍去生命。不过,除了像王阳明那样通过顿悟获知天道的以外,一个主要的途径是修身。即通过读圣贤之书成为君子。这方面有大量的文献,但需要我们进行认真的梳理和提炼。

总之,宗教皈依或体悟天道以后,人就达到了一个新的心理均衡或境界,《宗教经验种种》的作者威廉·詹姆斯将其称为“圣徒性”,包括:

1.  感觉过着一种更为广阔的生活,超越尘世微末的私利,……

2.  感觉理想力量与我们自己的生活是连续的,……

3.  极度的兴奋与自由,好象约束自我的界限熔化了。

4.  有关非我的要求,情绪中心转向慈爱与和谐,……(詹姆斯,2012,第267~268页)

显然,这种圣徒性与经济人的定义有明显的差别,后者强调人会趋利避害,选择对自己有利的决定,而反对对自己不利的事情。前者则完全没有这种考虑,超越了私利,并且有“非我的要求”(第1条和第4条),却将自己与天道正义(即“理想力量”)联系在一起(第2条),正因如此,他或她感到自己与他人或社会或宇宙之间的界限消失了(第3条)。当然具有圣徒性的宗教人并非与经济人完全对立,他们的快乐不仅来自于忘却个人私利及其带来的忧虑,而且来自社会与自己,整体与个人之间本来存在着的互利关系。所以我们可以说,宗教人不是否定了经济人,而是超越了经济人。

如果我们确定了有这样一种宗教人,那么很自然,由于他们与经济人的的区别,即超越个人利害的性质,也许就能解决第一节中提出来的悖论:如何约束政治结构中的最大的权力?

四、美国:一个例证

一般认为,美国的宪政民主制度之所以成功,是因为这种制度包含的互相制衡机制的结果。从总体上看,这大致不错。但这种大致看法,却掩盖了一个更重要的事实,即这种制度并不能在所有地方都实现完美的互相制衡,反而使人们误以为,一旦有了这种互相制衡的机制,就无需人的道德自律,其在制度结构中的作用并不重要。

事实并非如此。看一看美国创立的过程,就知道她不仅是一个世俗政治结构的精心设计,更充满了清教理想的道德激情。而后者,是美国宪政框架的重要柱石。《美国宪法的基督教背景》一书的作者约翰·艾兹摩尔指出,当初从英国移民到北美的人群主要是清教徒,他们想在北美建立一个奥古斯丁所说的“上帝之城”,一个基督教理想国。甚至有人称加尔文是美国的真正的国父(2010,第4页)。

这种基督教理想对美国的宪政制度有何重要意义吗?这当然是一个庞大的题目,由于篇幅限制,本文不可能做详细的讨论。作为替代方式,本文只通过两个故事和美国国父们的基督教背景来做一个简单的讨论。

第一个故事是说,1787年在费城的美国制宪会议期间,各州代表相持不下,会议陷入僵局,很多代表准备打道回府。6月28日,时年81岁的本·富兰克林站起来说,人类智慧是有限的,他们需要神的智慧,而“上帝掌管着着人类的事务。”他建议请牧师主持每天大会的祷告。他的建议虽然没有被大多数人马上接受,但几经妥协,还是请了牧师做了一次祷告。重要的是,正式的和非正式的祷告使人们将世俗的问题放在了上帝的视野下重新审视。“一种和谐的精神最终回到了大会中。代表们在大多数议题上达成了广泛的一致,在其它议题上也取得了和解。”(2010,第321~322页)美国宪法诞生了。

如果这个故事是真的,它至少告诉我们。在没有宗教因素的情况下,人们只按照经济人的逻辑去行事,他们赞成对自己有利的选择,而反对对自己不利的选择。在市场中,人们也有永远不能达成一致的情况,但这时他们可以一走了之;而在公共事务领域中,由利害冲突引起的永远不一致,却不能用一走了之来解决,只有互相僵持。如果宗教人意味着减弱甚至放弃自己的利害考虑,也就会导致各州代表们不就较次要分歧争执不下,他们就有可能达成一致。正如富兰克林所说,“我同意这部宪法,因为我没法期望更好的,也因为我不敢肯定这不是最好的。关于我个人认为其中有错误的地方,我愿为公众的利益而放弃我的看法。”(转引自艾兹摩尔,2010,324页)

第二个故事是说,独立战争结束后,1783年,有一批青年军官因军晌未兑现而企图发动兵变,推翻大陆议会。华盛顿知道此事,就到军营中去说服他们放弃哗变。军官们听从了华盛顿的劝告。从此美国就形成了一个重要传统,即军队要在文官政体的控制之下(themilitary serves under civilian control)。就在同一年年底,居功至伟的华盛顿就将军队的指挥权交回大陆议会,从而创造了一个宪政先例,即美国军队从属于文官政权(America’smilitary is subordinate to civilian authority)。不能不说,这是宪政制度的最重要原则。因为掌握了军队,就掌握了实际使用公共暴力的权力,一旦为一已之私而利用,无人能挡,宪政结构也就毫无保障。

不能不说,华盛顿的行为对美国宪政制度做出了关键性的贡献。因为“一个在华盛顿位置上的得胜将军满可以借此攫取权力,但华盛顿回到了他的私人生活中。”(A triumphant general in Washington’s position might have tried to seize power, but Washington returned to private life.)(美国国家历史博物馆)是什么力量让他放弃了在经济人看来的一个巨大诱惑?显然,是他内心的自律的道德力量。那么,这一道德力量是从哪来的呢?

在《美国宪法的基督教背景》中,作者艾兹摩尔对美国国父们的宗教信仰做了梳理。很显然,华盛顿是一个信仰上帝的人。尽管由于政治上的考虑,或对宗教教派间争斗的谨慎,他很少说出自己的具体宗教归属,但他并不忌讳说自己信仰上帝。在华盛顿回应一个牧师的布道词时表明他赞成:“(1)上帝希望人们生活在公民社会之中;(2)上帝为人们设立了统治者;因而(3)统治者有权受到尊重;但是(4)统治者也在上帝之下;(5)统治者接受上帝的审判;及(6)上帝可以让统治者下台。”(转引自艾兹摩尔,第105页)。

如果知道政府权力是上帝为了造福公民而设立的,而统治者只有在遵循上帝的正义才可以继续执政,华盛顿就会坚信,即使利用军队就可以掌握并维系政治权力,如果违背了上帝的正义,也要下台;即使赖在台上不下台,也失去了执政的合法性,既没有正面含义,也迟早要下台。所以利用军队去获得政治权力并非在他的选择范围之内。

除了华盛顿,其他美国国父们也大多有着很强的宗教信仰。麦迪逊,汉密尔顿,亚当斯,杰佛逊,不用说,富兰克林,等等。其中亚当斯和杰佛逊是两个典型。尽管托马斯·杰佛逊更强调理性主义,并没有明显的基督教色彩,但他无疑信仰上帝。在他起草的《独立宣言》中,他提到:

“……依照自然法则和上帝的意旨,接受独立和平等的地位时……”;

“人人被造而平等,造物主赋予他们若干不可让与的权利……”;

“我们坚定地信赖上帝的庇佑……”。(转引自艾兹摩尔,2010,第十三章)

而约翰·亚当斯就是一个纯正的清教徒,或者说是一个正统的加尔文主义者。他相信只有通过上帝的启示人们才能认识真理,只靠人的理性是不够的。而《圣经》就是神的启示。由于具有超越自身的视野,尽管他主张美国革命,但他在波士顿惨案中却为开枪的英国士兵辩护,也反对法国大革命。而鼓舞他推动美国独立的,不仅是世俗的利害,更是基督教的宗教热情。他把自己比作摩西,“摩西不是说过,‘我是谁?竟能领导这伟大的民族?’当我想到,在过去的那些伟大事件和正在快速发展的更伟大的事件中,我可能在拨动发条或推动小齿轮方面起到了关键的作用,一想到这个,我心中便现出一种难以形容的敬畏。”(艾兹摩尔,2010,第十五章)

艾兹摩尔提到,有两位教授,唐纳德·鲁兹(RonaldLutz)和查尔斯·希尼曼(CharlesHyneman)对美国1769年到1805年之间的2200种文献进行梳理,发现其中引用最多的文献来源是《圣经》,高达34%。各种不同思想资源的引用比例见下表。

美国国父阅读文献.png

这也说明,美国国父们基本上是一些信仰宗教的人,或者说,宗教人。正是他们对宗教的信仰,使得他们:

……

4.相信人非完人,政府理论必须虑及这一事实。

5.相信人间政府是上帝所命定的,为对人类的罪性予以限制。

……

8.相信人类之法应当与神法和自然法相符。与更高一级的法相违背的人类法无效,不应遵行,而应受到抵制。

……

10.相信神启法和自然法包含了生命、自由和财产等上帝赐予、不可剥夺的自然权利。

11.相信政府的建立是为保护人类权利,其基础是人民的合约或契约。

12.相信政府仅享有上述合约或契约中人民所授予的权力,一旦政府企图夺取人民未授予的权力,政府就变为不合法,应当受到抵制。

……(艾兹摩尔,2010,第60~61页)

我们知道,这些原则构成了美国宪法的基础。而这一宪法可能比以往所有的人类法律都更警惕政府滥用权力的问题,从而竭力设计出制衡权力的制度结构来。但这组宪法原则本身要经过一个正当程序才能有效。而只有制宪会议的多数代表达成一致才能通过这个政治程序。在这时,富兰克林以宗教的名义号召代表们放宽视野,减少利益争斗,各自多做让步,起到了达成多数同意的作用,从而使美国的宪法从原则变成文本。

而宪法文本要落实,就要由人来执行。华盛顿以最高军事长官之身份,自觉地遵守基本宪政原则,为后来的政治领导人和军事领导人做出了表率。而以后历届美国总统,即使不是基督徒,也至少是明确信仰上帝的人,他们都有经过不同路径皈依的过程,从而不同程度地接近是一个宗教人。正是他们身上的宗教性,让他们在相当多的情况下自觉地遵守宪法,保证了美国的宪政制度得以成功。

五、结语

如果我们仅限于经济学的经济人假设,我们无法解决约束和限制最高权力(或实权)的问题。而人类历史早就告诉我们,人们经过顿悟和修身可以达到皈依宗教和体悟天道的境界,即成为宗教人。宗教人不同于经济人,会超越个人利害,在没有外在约束的情况下,自觉遵循宪政原则,从而可能解决最高权力无人约束的难题,使宪政制度得以成立。

近代以来,人们过于迷信暴力的作用,迷信利用趋利避害本能的他律制度,而忽视有几千年历史的宗教和文化传统在制度结构中的作用,导致制度结构存在重大缺陷。尤其在中国,很多人只把社会改进的手段局限于或者是民主的,或者是暴力的,而没有看到宗教和文化传统在宪政结构中的重要作用,结果可能会在民主和暴力之间摇摆,而不能形成真正有效的宪政制度。如果我们认识到宗教人的制度含义,我们就会重新审视中国的文化传统或外来的宗教资源,才可能形成成熟且有效的宪政制度。

参考文献:

艾兹摩尔,2010,《美国宪法的基督教背景:开国先父的信仰和选择》,中央编译出版社。

Bowles,2004, Samuel, and Gintis, Herbert, The evolution of strong reciprocity: cooperation inheterogeneous populations, Theoretical Population Biology 65.1(February 2004). 中译文载汪丁丁等主编,2005,《走向统一的社会科学:来自桑塔费学派的看法》,上海世纪出版集团。

布坎南,2008,《宪法秩序的经济学与伦理学》,商务印书馆。

黄裕生,2008,《宗教与哲学的相遇:奥古斯丁与托马斯·阿奎那的基督教哲学研究》,江苏人民出版社。

科斯,2010,《论经济学与经济学家》,格致出版社。

詹姆斯,威廉,2012,《宗教经验种种》,华夏出版社。

 

(原载《新政治经济学评论》28,2015年1月。)

【横议】权力短暂,天道永恒|盛洪

流星

权力短暂,天道永恒

盛 洪

据传媒,公安部发布了《公安机关维护民警执法权威工作规定》(后简称《规定》)。其中包含了“民警按照法定条件和程序履行职责、行使职权,对公民、法人或者其他组织合法权益造成损害的,民警个人不承担法律责任,由其所属公安机关按照国家有关规定对造成的损害给予补偿”的内容。这一内容扩大了公安机关及其人员的权力,而减少和侵夺了公民的权利。根据我国《立法法》第八十二条规定,“没有法律或者国务院的行政法规、决定、命令的依据,部门规章不得设定减损公民、法人和其他组织权利或者增加其义务的规范,不得增加本部门的权力或者减少本部门的法定职责”,公安部此举显然是一个僭越立法权的自我授权之举。

有人辩称,这里所说的“按照法定条件和程序履行职责、行使职权”可以解释为“依法履职”。那么,这里讲的“法”是什么法呢?按照常识,法首先是天道之法,是自然法。一个国家只因要保护公民的权利才有其合理性和合法性。这种天道之法基本上在成文《宪法》中体现了出来,其核心部分就是对公民宪法权利的确定,包括人身自由(第三十七条),人格尊严(第三十八条),表达自由(第三十五条),信仰自由(第三十六条),私人财产不受侵犯的权利(第十三条),住宅不受侵犯的权利(第三十九条),通信自由和秘密(第四十条),享有公平司法和基本人权(第三十三条),批评政府及其工作人员的权利(第四十一条),非公经济的合法权利(第十一条),等等。公安部门之所以设立,首先是为了保护这些公民宪法权利,它所依之“法”,首先就是宪法。《警察法》把“拥护中华人民共和国宪法”作为一个警察的首要条件,所以“依法履职”之“职”就是保护公民的宪法权利不受侵犯的天职。

既然“依法履职”就是保护公民宪法权利,怎么还会出现公安部所说“对公民、法人或者其他组织合法权益造成损害”呢?这显然是一个宪法性悖谬。能够“对公民、法人或者其他组织合法权益造成损害的”,一定是违反宪法及相关法律的行为,而不是“依法履职”。“依法履职”只能使公民的宪法权利更为安全。因为这些“合法权益”是受《宪法》和法律保护的。《警察法》第二十一条规定,“人民警察遇到公民人身、财产安全受到侵犯或者处于其他危难情形,应当立即救助”。也就是说,看到“对公民、法人或者其他组织合法权益造成损害的”行为,警察加以制止还唯恐不及,还要“依法履职”“对公民、法人或者其他组织合法权益”加以“损害”吗?将公安部新规的实质含义串起来,难道不是“对公民、法人或者其他组织合法权益造成损害的”的行为,“民警个人不承担法律责任”

依此推理,公安部在这一《规定》中所说之“法”就不是宪法以及符合宪法的各项法律,而是另有所指。在现实中,我们经常看到警察口称“执法”,却做着违反《宪法》及《警察法》的事情,一旦当事人要维护自己的公民权利时,他们就说“妨碍公务”,这已成为一个套路。如警察半夜破门而入的情况有之,无端限制公民人身自由的情况有之,损害公民财产权利的情况有之;每年大量的强拆导致的数万起群体性冲突事件,多是在警察的介入下发生的。前述《宪法》规定的多项公民权利几无幸免。这些违宪违法行为绝大多数都没有得到惩处和纠正,他们也视这些行为为正常。实际上,我国警察作为一个群体,长期以来忽视宪法教育,很难做到自觉地执行保护公民宪法权利的天职,而多把上级命令当作“法”。例如重庆的一个女警察回忆被无辜劳教受到残害的日子时说,专案组警察也知道是错案,但他们说“领导要求这样办,只有办错案”。在不能辨清什么是所依之“法”,或明知领导命令有错却还要执行的情况下,告诉警察在“依法履职”时,可以损害公民权益,该是多么危险。

在公安部该《规定》中,提出它的新规定的理由是,“改革开放40年来,全国共有1.3万余名公安民警因公牺牲”。如果他们是为了维护公民宪法权利而牺牲,我们应该为他们哀悼,但这不意味着应该由此得出,如果损害了公民的权益,“民警个人不承担法律责任”的结论来。因为这只是单方面的统计数字。在这些年,又有多少公民因警察的原因而命丧黄泉呢?由传媒披露的重大恶性案件就有,2001年福建福州市数名警察设局杀人案,2004年河南周口市6警察杀人案,2009年云南蒙自县警察杀人案, 2010年贵州关岭县的警察枪杀两人的案件,2010年内蒙古太仆寺警察枪杀三人案,2012年在辽宁盘锦市发生的警察枪击案,2013年广西平南县发生的警察枪杀孕妇案,2013年贵州安顺警察杀人案,2015年内蒙古公安厅长杀人案,2017年湖南新化县的警察开枪杀人案,等等。最令人震惊的还是雷洋案,一个从洗脚店经过的人竟遭不测,而没有一个警察为此负法律责任。

而其中的一些警察杀人行为,是以“依法履职”为名义的。如雷洋案是因“抓嫖娼”,盘锦警察杀人案是为了强拆,所依是领导之“法”。还有更大范围的警察侵害公民宪法权利的事件,是在所谓“依法”的名义下进行,如薄熙来主政时期的重庆,在“打黑”的名义下滥抓无辜,被抓捕的多达4000多人。重庆警方在非法设立的“打黑基地”中滥施酷刑,包括“老虎凳”,“打表”,“鸭儿浮水”,“苏秦背剑”等,还有精神折磨,如所谓“政治归零”,“经济归零”和“情感归零”等。很多人不经法律正当程序而被判处死刑,有13人被执行死刑。而当一些地方政府及其官员强征农民土地时,警察经常被用来压制失地农民,造成大量人员伤亡的恶性事件,如盘锦征地警察杀人案。我们曾根据传媒报道,做过一个不完全统计,2003 年到2014年8月间共有182件强拆恶性事件,共造成强拆双方的人员伤亡484人,死亡人数162人,受伤人数322人。而没有被报道的恶性事件就更多。

有人会说,我举的例子只是个别现象,薄熙来也不过是一个偶然出现的情况,不能代表主流和总体。其实不然。所有的人都是凡人,在没有制度约束的情况下,好人也会变坏,更何况,事实表明,薄熙来不只是偶然出现的坏领导。周永康就是另一个例子,他曾是武装警察的主要领导。2012年至2016年,就有23名公安系统官员落马,其中有5名副部级以上官员。还有人开列了“不寒而栗的一串名单”,列数从周永康开始的100位落马公安系统高官。尽管如此,中纪委仍然认为,公安部的反腐力度不够。关键还不在于这些公安系统的领导是否腐败,而是作为一个凡人,只要没有制度的强力约束,他们会不会自觉地忠于宪法精神,把保护公民的宪法权利作为自己的第一要务。在另一面,如果我们的警察群体只是把上级命令当作“法”,就难免会做出违反宪法,伤害公民的合法权益的事情来。而当他们遵照上级命令“依法履职”而又“不承担法律责任”时,不就可能造成对公民权利的更大伤害吗?

公安部的新规还提出,在警察个人不承担“对公民、法人或者其他组织合法权益造成损害”的法律责任的情况下,“由其所属公安机关按照国家有关规定对造成的损害给予补偿”。这更是一个悖谬的要求。“补偿”从何而来?还不是国家财政;国家财政从何而来?还不是老百姓的钱。逻辑就变成这样,对公民合法权益的损害,损害者不需承担法律责任和赔偿,而要由公民自己赔偿。一个社会,如果让受害者自己赔偿自己的损失,怎么能制止加害者?在加害者受到鼓励的情况下,受害者还能生存吗?汉高祖的约法三章,“杀人者死,伤人及盗抵罪”之所以能在乱世中稳定人心,就是道出了最朴素的规则:损害者要承担罪责。这是古今中外最基础的文明规则。计划经济的失败告诉我们,当个人不承担他们的行为后果时,效率可以低到何等程度;当个人不承担损害他人合法权益后果时,带来的社会损害将不堪设想。更何况警察还不是普通百姓,他们手中握有暴力工具,一旦允许他们不承担损害后果,他们将会失控于公安部门;公安部门也将会失控于社会。

最后还要看到,公安部的这种新规看起来是为了保护警察利益,实则不然,而是将警察置于一个更危险的境地。如果警察不是保护公民的宪法权利,而是执行上级领导偏离宪法精神的命令,并且不需要承担法律责任,势必加剧警民之间的紧张和对立。当酿成恶果时,当初执行上级命令者或者成为领导的替罪羊,或者被领导袒护而遭私人复仇。事实也告诉我们,那些执行错误命令的警察下场都不好。如重庆薄时期的“打黑英雄”,王立军自不必说,曾获“重庆五一劳动奖章”的周渝于2014年自杀,“一等功臣”唐建华被捕入狱,“一等功臣”郭维国获刑11年,王智获刑5年,郑小林,苟洪波,但波等因刑讯逼供罪被起诉定罪,等等。有人会说,还不是因为薄熙来倒台了吗?然而薄的倒台不正是因为他下达了罪恶的杀人命令吗?再则,如果不能保护公民的宪法权利,警察自己的宪法权利首先得不到保护,如重庆打黑的序幕,就是对警察队伍的清洗,有900多警察遭受不白之冤。

权力短暂,而天道永恒。实际上,对于任何一个警察或官员来说,拒绝执行上级领导侵犯公民宪法权利的错误命令,才是对他自己最安全的选择。许多犯罪的警察总以“执行上级命令”来为自己开脱,他们期待的是上级权力罩住他们而不受惩罚,但结果仍是逃脱不了法律的惩罚。应该明白的是,他们的上级最终会因他们自己执行错误命令而失去权力。反过来说,拒绝执行上级的错误命令反而是对上级的“爱护”。其实,执行错误的命令就是一种罪,这被汉娜∙阿伦特称为“平庸的罪恶”。她说,这种罪恶之所以不可饶恕,是因为所有的人都可以“服从命令”为借口,摆脱自己的责任,于是一个社会在看来没有任何个人负责的情况下遭到灭顶之灾。大多数社会都有相关的规则以避免这种情况。我国《警察法》第三十三条规定,“人民警察对超越法律、法规规定的人民警察职责范围的指令,有权拒绝执行,并同时向上级机关报告。”我希望我们的警察兄弟把《宪法》中的权利条款和《警察法》第三十三条作为金科玉律和护身符。

即使真的依宪法和法律履职,也并不是可以随便为之,又能不承担法律责任。执法也有程序问题和方法问题。我们不时看到粗暴执法的情形,如2016年5月17日,兰州一大学生因拍摄警察粗暴执法而被警察殴打;2017年4月17日沈阳市4名警察在抓捕嫌疑犯时不出示证件,也不验明正身,就将人打了一顿,结果发现抓错了人;2017年9月1日上海警察在纠正一名妇女违规停车时,将抱着孩子的妇女推倒在地并压住,并摔伤孩子;2018年5月27日,安徽六安教师讨薪,被警察殴打;等等。概而言之,如何执法也有一个是否遵循宪法的问题。纠正一个交通违规错误,或抓捕一个嫌疑犯,是为了公众安全,如何在执行过程中造成公民不必要的伤害,则违反了设立警察的初衷。不遵循正当程序和不采取恰当方式的所谓执法,实际上仍然是违反宪法精神,对公民权利造成了损害。因此,这也不应“不负法律责任”。

最后,公安部的这个《规定》所引起的实际上是一个宪法性问题。如果这个《规定》真能成立,《宪法》就该修改。这个《规定》通篇只讲警察的权利,而只字不提警察应该保护的公民的宪法权利。只有一处提到时,却是假定如果损害了,警察如何可以不负法律责任。仿佛警察群体是一个自外于公民和社会的特殊集团。在其它条款中,该《规定》将适用范围扩展到“被恶意投诉、炒作的”,和“被错误追究责任或者受到不公正处分、处理的”等方面。什么是“恶意”,什么是“善意”;什么是“舆论监督”,什么是“炒作”,不是公安部门自己一方可以说了算的,而要经过一个法律的正当程序以辩明事实。在我国的现实中,公安部门由于拥有暴力,无论法律如何规定,它相对于其他公民来说,有着实际上的优势。所以这一《规定》实际上使已经不平衡的天平更多地倒向本来就有优势的一方。有鉴于此,公安部门作为一个部门与其它部门有着很不相同的性质,它所制定的部门规章就不是一个管理部门内部事务的规章,而有很强的外部效应。有如此内容的《规定》就不应由公安部门自己制定。

如果这个《规定》落地,对公民宪法权利的侵害行为将会数倍、数十倍于现在。对于执政党和政府来讲,这也是极为负面的。因为警察之位虽低,他们的行为和态度却代表政府的形象。一旦政府告诉警察可以损害民众的“合法权益”而不承担责任,他们会因连他们自己都觉得过于宽纵的这种姑息而蔑视政府,遑论公民权利,可能会主动侵害民众而惹出事端。伊拉斯谟曾说,“即使是最强大的君主,也不能承担激怒或藐视哪怕最卑贱敌人的代价。”执政党如果设想用这样的方法来“维稳”,可能会适得其反,进一步动摇执政党的政治合法性。所以执政党和我们的社会还是要及时纠正这一错误的《规定》。由于它存在着严重违反《宪法》精神的内容,我建议国务院可以根据《立法法》第96条 判定该《规定》“超越权限”和“下位法违反上位法规定”;根据97条规定的“国务院有权改变或者撤销不适当的部门规章”,撤销该《规定》。人大常委会也可进行合宪性审查,以违宪为由撤销该《规定》。

荀子说,“天之生民,非为王也;而天立王,以为民也。”这说出了“王”的权力来源:奉天为民。在这里,“天”是天道,“民”是民众,“王”是政府。警察之所以存在,是因为民众需要;如果他把自己放在民众之前,就没有存在的必要。这就是天道之法。天道之法不是可以人为改变的。如果以为可以改变,那是权力的狂妄。人类最大的努力就是使人造之法更接近天道之法。不过,无论怎样,人类都不得不遵循天道之法。当人造之法接近天道之法时,他们就在遵循天道之法;当人造之法背离天道之法时,他们就会受到天道之法的惩罚,最终还要回到天道之法。所不同的是,前者是主动的遵循,只需付出较小成本;后者是被动遵循,要付出很高的代价。到底是多少,取决于什么时候纠正。

 

2019年2月20日于五木书斋

2019年3月11日同步首发于《FT中文网》和《中评周刊》

 

 

 

 

 

 

 

 

 

 

 

 

How to Reverse the Economic Downturn? / Sheng Hong

悬崖

How to Reverse the Economic Downturn?

Sheng Hong

It seems that there is no objection to whether the Chinese economy is seriously declining. What is the economic growth in 2018? There are still many judgments. For example, the National Bureau of Statistics says it is 6.5%, Xiang Songzuo said that the estimate of an institution is 1.67%.The “Keqiang index” I calculated (Note 1) is 3.6%; and after correcting the power generation of an important component of the “Keqiang Index” (Note 2), the “Keqiang Index” is about -1%. .The task now is to reverse the economic downturn. The policy for the right medicine should obviously be based on correct diagnosis. I have always stressed that because China’s urbanization process has not been completed, because China has a “major country effect” in international trade, we still have 15 to 20 years of rapid economic growth. These two advantages have always been the basis for our economic growth, bringing about an annual growth of 5 to 6%.Since there is such a growth base, why is China’s economy going down in 2018?

In my opinion, there are mainly four factors. The first is that the tax burden is too heavy, the second is the unfriendly to private enterprises, the third is the anti-urbanization policy (such as limiting the size of the city), and the fourth is the violation and restriction of the network economy. For the first point, I have discussed in detail in the article “The government share is expanding, the profit margin will be exhausted”. On the second point, I also discussed in the article “How to let private entrepreneurs believe in the government”; on the reverse urbanization policy, I also discussed in the article “The livelihood of the ordinary people, the foundation of big countries”; regarding the restrictions on the network economy, I discussed the positive impact of the new economy in the article “Two Kinds of Economy in China”. I will write an article devoted to the negative impact of limiting the new economy. In addition, there are two very important factors, one is the problem of state-owned enterprises, and the other is the issue of land system. The solution of these two problems will bring about a growth rate of more than one percentage point of GDP, but these two are long-term unresolved issues, not the main reason for the economic downturn in 2018.

It is clear what kind of policy should be adopted for these four major issues. In view of the problem of excessive tax burden, large-scale tax reduction is required. For the problem of private enterprises, it is necessary to improve the judicial system so that it can truly protect the legitimate rights of private enterprises. Regarding to anti-urbanization, it should stop restricting the size of the city, this is a policy that directly offsets the positive impact of the urbanization process; let the city open to all, and adopt other specific methods to solve the problem of insufficient single resources in the city. As to the limits to new economy, it should be realized that the property rights formed by the network economy are also property rights. It is also necessary for it to obtain protection as property rights do, and to protect the network market as well as protecting the physical market.

However, not all economists now agree with these four points, and the resulting policy recommendations are very different. There are two very different views on the excessive tax burden. One is to acknowledge that it is heavier than the Laffer Curve’s best tax rate, but it is not a big problem, not the main reason for the recession. The result of heavy tax burden is only to make the income of enterprises and residents less, which leads to weak consumption, but this can be compensated or replaced by expansionary macro policies. The other, my opinion, is that the tax burden is too heavy, not only above the optimal tax rate, but also to the point where companies can no longer survive. That is, companies have no profit margins. These two different views on tax burden have also led to different judgments on the nature of the economic downturn. The view that tax burden is not the main reason for the economic downturn argues that this economic downturn is similar to a cyclical recession, so it can be mitigated and hedged by counter-cyclical macroeconomic policy. The view that tax burden squeezes out profit margins argues that enterprises will shut down or evacuated in a short period of time, leading to an avalanche-type economic downturn, rather than a cyclical problem, so tax cuts must be taken. See the figure below for specific logic.

Figure 1 Schematic diagram of the tax rate affecting the economy

collaps

Description: This picture is only a schematic diagram. The horizontal axis represents time and the unit can be 1 year. Assume that over time, the tax rate is gradually increasing (measured by the right-hand coordinates). For a long time, although the government’s income is increasing, the income of enterprises and residents is decreasing, but it does not affect the total social income. But after a certain high tax rate (16% here), the company began to shut down or evacuate, and showed acceleration, while the total social income fell like an avalanche.

In the absence of profit margins, if only adopting an expansionary macro policy, adding a counter-cyclical demand increase based on the total demand determined by the market will only partially increase the company’s orders, but due to the high tax rate, there is still no profit margin. If an enterprise increases the output of one unit, it can only increase one unit of loss. The enterprise still has no incentive to expand production, and it cannot boost the economy from a macro level. Because the expansionary macro policy has not changed the distribution structure between the government and the corporate residents, the enterprise is still in a situation where there is no money to make. Others would say that the new demand from expansionary macroeconomic policies will reduce equipment idle rates and thus reduce average fix costs. In fact, since macroeconomic policy is only a countercyclical policy and is only adopted during a recession, the demand growth brought by this policy will not bring more demand than normal, and it will only reduce the equipment idle rate of the enterprise to normal status. The chart below shows the situation of the capital “deserved income” (no risk interest rate + reasonable risk premium) of private manufacturing listed companies. The chart shows that since 2012, the income of the capital of these enterprises has not cover the loss, and the length of time is close to a medium cycle. The loss that we see in the sense of capital “deserved income” is the loss under normal conditions, so expansionary macroeconomic policies cannot fundamentally change the company’s loss expectations.

Figure 2  The part of the private equity manufacturing listed company’s return on net assets minus the “deserved income” from 2009 to 2016

deserved income

Explanation: This picture is a picture I used in my article, “Government’s share expanding, profit margin will be exhausted”. This is the net return on equity of privately companies in manufacturing minus the risk-free rate, minus the reasonable risk premium. The implication is that when this number is negative, the return on net assets is already lower than the reasonable return of capital. It should be noted that this data have been negative for many years since 2012. If the economy declines severely in 2018, it may be a larger negative number. From 2012 to 2016, we should also regard it as “normal years”, so the expansionary macro policy can only pull the situation of the enterprise back to the “normal year” and cannot eliminate their losses.

A more detailed analysis is that the expansionary macro policy will increase the supplementary demand when the demand shrinks, and mitigate the impact of the recession, but only reduce the fixed cost allocation, but cannot fully offset the fixed cost (depreciation + capital cost + management fee) ) the apportionment. Because as mentioned above, capital has no reasonable return. At this time, although the company can regard the fixed cost already invested as the sunk cost, do not care, as long as the current price can make up for the variable expenses, it can continue production. But entrepreneurs will not make new investments because capital is unprofitable. This macroscopically shows that expansionary macroeconomic policies can stimulate short-term production growth, but cannot stimulate long-term production capacity increase, which cannot fundamentally solve the economic downturn. What’s more, according to the theory of rational expectations, macroeconomic policies can only be “unexpected” and only work if the enterprises and residents cannot foresee. If the government claims to adopt an expanded macro policy in advance, the enterprise will not be bewildered by additional demand, and rashly take the decision to increase production capacity and investment, but raise prices. As a result, the economy has not grown, and prices have gone up. This is stagflation.

Regarding the expansionary macro policy, when the economy is seriously declining, macro monetary policy will not actually have much effect. Because the money supply depends on the base currency and currency turnover rate. The central bank can only affect the issuance of the base currency, and the speed of currency turnover depends on the efficiency of the market system and people’s expectations. When people are generally pessimistic, the currency turnover rate will slow down, thus offsetting the effect of the central bank’s expansion policy. What’s more, when the market system is weakened, the currency turnover rate will also slowdown. In addition to this, it is the macro fiscal policy. We know that this is even more problematic. The first is that adopting an expansionary fiscal policy requires more financial resources, which greatly reduces the incentives for tax cuts. Second, as we saw in 2008, the expansionary fiscal policy only emphasizes Increase demand without paying attention to the investment of financial resources and related efficiency. On the one hand, financial resources will rely on the channels of state-owned enterprises, while the efficiency of state-owned enterprises is relatively low; on the other hand, in the context of government decision-making and emergency response, financial resources are more likely to invest in the wrong direction or industry, resulting in further distortion of production structure.

Some people will say that didn’t the “four trillion” expansionary fiscal policy in 2008 avoid China’s economic recession?Why can’t it be done now? If “four trillion” still has the right place, then the timing is right. .Because it is only based on general budgetary expenditures, China’s macro tax rate is 6.2 percentage points lower in 2008 than it is now.(In this paper, the “macro tax rate” includes general budgetary expenditures, government fund expenditures, state-owned enterprise opportunity income, and social security. Here, we assume that the proportion of latter three parts in GDP is not changed, and treat the changes in general fiscal budget expenditures as Changes in macro tax rates.) Going back 10 years, the macro tax rate from 1999 to 2006 is 5 to 7 percentage points lower than the macro tax rate from 2009 to 2016.See Figure 3.Therefore, at that time, the capital gains of manufacturing enterprises were still above the “deserved income”, capital was profitable, and enterprises were willing to expand production and investment.

Figure 3 General Budgetary Expenditure/GDP from 1999 to 2006 and 2009~2016

expendituregdp

Note:Going back 10 years, the company has additional profit margin   which amounts to between the above two lines, about 5~7%.In this picture, I put the general budgetary expenditure/GDP from 1999 to 2006 in the same period as the general budgetary expenditure/GDP from 2009 to 2016. We can visually see the gap in the macro tax rate over the past 10 years.

Under such a tax rate, the company’s capital “deserved income” is met. Most of the data in Figure 4 is the same as Figure 2, except that the tax rate 10 years ago was adopted .Therefore, the adoption of expansionary macroeconomic policies 10 years ago not only increased orders, but also increased profits, and also prompted enterprises to increase investment and production capacity, thus enabling China to avoid the economic recession in the context of the global economic crisis. However, today, when the macro tax rate is 5-7 percentage points higher than 10 years ago, the so-called “four trillion” policy will no longer have the original effect. We can also consider the data in Figures 2 and 4 as the basis for calculations when entrepreneurs make decisions, and they calculate the expected return on their investment by the average. The actual income is fluctuating around the expected value. When the expected value is lower than the capital “deserved income” (Figure 2), they will not invest.

Figure 4 The portion of the private manufacturing listed company’s return on net assets from 2009 to 2016 calculated according to the macro tax rate from 1999 to 2006 is higher than the “deserved income”

deserved income2

Note: All the data in this figure are the same as in Figure 2, except correcting them by the difference between the existing macro tax rate and the macro tax rate 10 years ago.

Of course, many people have pointed out that the “four trillion” policy still has many drawbacks. Most people regard expansionary policies as demand policies. There has never been an isolated demand side policy or a supply side policy. The expansionary fiscal policy is mainly achieved by increasing government expenditures, including public works expenditures, and increasing the investment of state-owned enterprises. Therefore, the first is the impact on supply. Focusing on the stimulus to demand, because of the classic metaphor of Keynes’s “pit-digging and filling”, people generally don’t care what the government or state-owned companies are spending. In the implementation of expansionary fiscal policy, the government and state-owned enterprises are less concerned about whether the investment projects are economically reasonable, and they do not care whether they make money, so it is obviously much less efficient than the market-determined investment, resulting in resource misplacement. .Once the direction and industry were misdirected, it was difficult for the government and state-owned enterprises to withdraw easily. This caused a serious imbalance in the supply structure and the so-called “overcapacity.” This is not only a domestic economic issue today, but even an international economic issue. Obviously, adopting an expansionary fiscal policy will not only cannot solve the supply structure problem, but will worsen it.

Another view is to reduce taxes while adopting an expansionary fiscal policy. The problem is that tax cuts require a reduction in fiscal revenues, while expansionary fiscal policies require increased government spending; this will increase the fiscal deficit. This in itself will contain the tax cuts, making the tax cuts less than they should be. Even if the deficit is increased and the large-scale tax cuts and expansionary fiscal policies are implemented at the same time, the large deficit itself will bring new problems, which will not only offset the benefits of the two measures, but also bring about other damages. For example, there are two ways to hedge a deficit. One is borrowing, and the other is issuing money. For the government to borrow, there is a “Ricardo equivalent” proof that borrowing is only a delayed tax, and its effect is equivalent to taxation. Buchanan admits that there is still a difference between “taxation” and “deferred taxation”. This is because modern people borrow money and let it is returned by future generations, which will give people a “financial illusion” and think that public goods are cheaper. But the result is that the government will be levied more taxes. What’s more, the government’s increase in borrowing has squeezed the resources of the money market, which has led to an increase in interest rates, which has led to an increase in the financial costs of enterprises. Therefore, borrowing debt to expand fiscal policy will eventually offset the benefits of tax cuts.

The so-called “increasing currency” is the issuance of the base currency above the reasonable rate of money growth, and the result is inflation. As mentioned earlier, in the early stages of the recession, due to widespread pessimism, the base currency issued could not effectively increase the money supply. This has been proved by the facts of our country in 2018.From 2018 to the present, the central bank has reduced the deposit reserve ratio four times. By the end of the year, the loan balance increased by 13.5% from the end of the previous year, an increase of 2.6 trillion yuan over the previous year, but the money supply (m1) increased only 0.005% by the end of November. On this basis, the continued issuance of currency will not have a significant effect in the short term. But these additional currencies will lurk, and jump out when the economy turns around and the currency turnover speeds up, bringing inflation. The depreciation of the currency brought about by inflation is equivalent to imposing an inflation tax on businesses and residents. Nominal income appears to have increased, but production costs and consumer goods prices have increased year-on-year and will be completely offset. Since there is a time lag between the issuance of money and inflation, since the issued currency flows from the government to the society through state-owned enterprises, the government and state-owned enterprises will eat most of the inflation tax, and the private enterprises will increase the tax burden. .So choosing an inflation policy does not make a company enjoy a lower tax burden.

The most important issue of the expansionary macro policy is that it is only a countercyclical policy. What we are facing now is not a cyclical recession, that is, the adjustment caused by some investment mistakes brought about by the economic upswing, but a big problem that most companies have no profit margins. Therefore, our current task is not to counter-cyclical, but to curb the economic collapse. If we can’t prescribe the right medicine, we can’t stop the economy from continuing to decline. And as mentioned above, it may bring stagflation, further worsen the macroeconomic situation, and then when we want to go back and implement tax cuts, it has delayed the timing and will have to pay a higher price if it is to be corrected. Because it is followed by a crisis in the financial market due to problems in the real economy, leading to the break of the creditor’s debt chain, and the rapid contraction of the money supply, which in turn will hurt the real economy, and the real estate market will also have a crisis, leading to a rapid economic contraction. Finally, it is the employment problem. In the past, China has to provide 10 million new jobs every year. If the economy is seriously declining, the employment problem is a very serious problem. And these problems have begun to appear now. Therefore, policy choices should not allow to be wrong.

Therefore, only large-scale tax cuts can really reverse the economic downturn. The so-called large-scale, I have proposed that the value-added tax should be reduced by more than 3 percentage points, and the corporate income tax should be reduced by more than 5 percentage points; overall, the macro tax rate should be reduced by more than 4 percentage points. This is equivalent to 4 trillion yuan. It can’t be called “mass tax cuts” if it is reduced by several hundred billion yuan. The core role of large-scale tax cuts is to give enterprises and residents a clear profit margin by giving a strong signal, so that they have incentive to invest. This is an action to expand long-term effective production capacity. Tax cuts themselves will increase the current income of enterprises and residents by changing the distribution ratio, thereby increasing the current total demand, but the greater demand brought by tax cuts is actually the investment demand brought by the optimistic expectations of such enterprises, and the recovery from the market transactions and the increase in revenue generated from the market. This kind of income is the healthiest, most mainstream, largest, and most market-dependent income, because it shows that the company’s products are marketable products that meet the real needs of the market. It is a reward for making the right decisions about production and investment.

As mentioned earlier, tax cuts, although referred to as “supply policies”, actually bring about an increase in the total health demand. Say said that “supply itself brings demand”, and Steven Cheung goes further and says “people supply for their demand” , this relies on an effective and mature market. Only when the transaction is voluntary, the price signals formed by many transactions are not distorted, enterprises and residents make production and consumption decisions based on price signals, and supply will directly become income, and income will directly become demand. Therefore, as a supply policy, tax reduction requires simultaneous market-oriented reforms and reduced government intervention. Another self-evident consequence of tax cuts is the need to streamline government institutions. The main reason why China is currently weakening the market system, distorting the price signal, and intervening in the behavior of market entities is that the government departments are too large. If we streamline 90% of the administrative permissions, streamline those government departments that have a negative effect on the market, and streamline the overly bloated administrative agencies, we can greatly reduce intervention to market, and threats to and violations of corporate property rights. At the same time, solve the problem of being unfriendly to private enterprises.

Tax cuts will not bring about fiscal deficits caused by expansionary policies, inflation, and crowding out money resources, so it is a policy with little side effects, health and cleanliness. It will also significantly speed up the economy, so the tax cut is lower than the tax-rate cut (ie, lower than the aforementioned 4 trillion yuan).It has only one weakness, that is, the government administration may not like it. Because tax cuts are a reduction in the amount of resources that government administrations may control, this is at least intuitively detrimental to these sectors. The expansionary fiscal policy requires increasing the resources that the government’s administrative departments must control, and at the same time increasing their power and interests. As a result, expansionary fiscal policy is more likely to be a substitute for tax cuts for macro decision makers. But the hope that the expansionary macro policy works will only be a desire. What is actually going to happen is likely to be as described in this article, which will quickly lead to a deterioration of the situation. Only those who have a vision beyond the immediate interests of the executive branch, and who have the mind and foresight, can take drastic tax cuts. At the end of last year, the Politburo of the Communist Party of China proposed to “reducing taxes and reducing fees on a larger scale.” We will see what “larger scale” means.

————

Note 1: The three components of the “Keqiang Index” in this paper are: by November 2018, the growth rate of cargo turnover (3.4%, weight 25%), the growth rate of money supply (m1) (0.005%, Weight 35%), power generation growth rate (6.9%, weight 40%).

Note 2: This is a correction based on data provided by my authoritative friend. The corrected power generation growth rate is -4.7%.

 

January 5, 2019 in Fivewoods house

Published on January 22, 2019 firstly in FT Chinese and China-review Weekly

Trade and Civilization/Sheng Hong

大海与城市

Trade and civilization

Speech at the “2018 Good Book Awards Ceremony” on January 9, 2019

Sheng Hong

Trade and civilization, these two themes are very important. We are now in the context of trade war. The US trade negotiating delegation has just arrived in Beijing recently. Everyone is concerned about whether we can reach an agreement that both parties are satisfied with.

Why is “civilization” very important? Because human civilization is hard to come by. As we all know, humans evolved from chimpanzees, and we have very cruel genes. After tens of thousands of years, especially in recent thousands of years, human beings have gradually developed a culture to overcome the cruel genes similar to chimpanzees in our human beings. When one person has another conflict of interest with another, we often Will tend to use violence.

But civilization is not like this. About 20 years ago, I wrote an article called “What is Civilization?” I made a definition of “civilization” at the time: civilization is a peaceful way to resolve the conflicts between people we used to solve by force. I think this is a very important change, although this sentence is very simple.

In the early days of mankind, the human violent death rate was about 15%, which is very high; after entering civilized society, it dropped to 3% to 5%; to this day, human violent death rate is relatively low, at 1 %the following. Why? It is humanity who has discovered some rules of civilization.

One of the most important rules of civilization is transaction, which is trade. So what is trade? Trade is not to fight for wealth with others through violence, but through peaceful means. In a violent way, on the one hand, it is a zero-sum game. The result of this game does not increase the wealth of whole society. On the other hand, some of them suffer losses or even lose their lives. But the trade is very great. The great thing about trade is that the two sides of the trade negotiate peacefully in a peaceful manner and finally reach a satisfactory result. Its follow-up results are more than that, because the achievement of this transaction will make people beyond a fauna and bring about a wider relationship between people, which forms a division of labor between human societies. Today is the global division of labor – this is not a division of labor for a small group, it is a global division of labor.

Today, we don’t know where the clothes or other products we wear made from; or one other person on the other side of the earth may have something to do with us, but we don’t know. But everyone knows that a chimpanzee and other chimpanzees do not have a relationship beyond a natural group. So this is a very, very big difference.

As a result, trade has brought about the growth of human wealth. This kind of growth is through the division of labor, through specialization, through the cooperation between people to promote technological innovation, institutional innovation, and the emergence of huge wealth. Trade is actually a basic civilized rule. Because of this rule, human beings have come to this day, and they will not use the cruel means of the past to achieve their goals because they want to have more wealth, but they can completely adopt peaceful means. In this sense, trade is a very important rule of civilization.

The history of mankind, these thousands of years, especially in recent centuries, due to the development of trade, the globalization of trade, the growing wealth of human beings, our lives are getting better and better, and we live happier than before. This is a very important aspect.

Therefore, we cherish this rule very much. This rule is the market rule that both China and the United States emphasize. It is the equal negotiation between people, the voluntary achievement of the transaction, and the last faithful performance of the contract. This kind of rule has almost become the golden rule, and it has been summarized by economics textbooks.

Economists are convinced of this: as long as people are free, then equal negotiations between people, and voluntary transactions, we will have a better result, we will also get more wealth in peace.

But it should be said that this rule is not perfect. Everyone needs to know that when economics discusses free trade, it actually makes a lot of assumptions. One hypothesis is that there is basically no big difference between people, and there is not much difference between countries; the second assumption is that free trade must include other conditions. For example, there must be free flow of capital and free movement of the population. Free trade can achieve the desired results only if you have these three freedoms at the same time. But in fact, in the real world, these assumptions do not necessarily exist at the same time. Economics assumes that when people and people trade, people are basically the same; but in reality, people and people still have differences – people have different resources in terms of resource endowment, strength and so on. To give the simplest example: men and women are different.

Later, economic liberals also noticed this: if we simply talk about economic liberalism and simply assume that everyone is equal, that is not enough – if we only assume this, then we only have to do one thing. It is enough to strive for the best interests of yourself. But many people find that this is not the case. There is a school in economics called the Santa Fe School, which has done a computer simulation of human society: If this society is the kind of “economic man” that economics assumes, then it will eventually collapse. Therefore, they found a problem: this society also needs a class of people who not only proceed from their own interests, but also from the perspective of the whole society, from the perspective of maintaining the civilized rules of the whole society when the rules are violated. You need to stand up and defend this rule, and you will not hesitate to sacrifice your personal interests.

The Santa Fe School manages this kind of person as a “strong reciprocator”. In fact, this is the elite of society. The reason why any society is condensed into society and formed into a structure is related to the social elite. A society must have such people: on the one hand, as an “economic man”, and strive to fight for their own interests; on the other hand, they must stand up and work hard for this society, and strive to maintain the civilized rules that make this society more affluent. .At the same time, there is another characteristic. He is not necessarily an “economic man”. He may have to restrain himself. This is very important.

Hu Shi has a very good sentence: “Afraid of his wife is a man’s civilization symbol.” Why? I have said that men and women are different. Men have an advantage over women in violent resources. But if he does not restrain himself, he may often beat his wife. This is not the rules of civilization that enable a family to exist, a marriage to exist, or a society to exist, so he must restrain himself, so “afraid wife” is the symbol of men’s civilization.

Teacher Mao Yushi is an economist and later he founded the Humanities Economics Association. This is very strange to everyone. Later, I carefully observed his transformation. I found a problem: Teacher Mao was originally an engineer. His mathematics, physics, chemistry are better. He can enter economics from a mathematical point of view, but then he went to the Humanities Economics. Why? Because he found a problem – the same as the one I just discovered: if you assume that each number is followed by a unit without a soul, then as a mathematical economist, you may be heading towards a constructivist Direction, then you really don’t understand this society. This made him understand that there are many different people in this society. These different people are not equal as economics assumes.

After discovering this, Teacher Mao said a very important statement: “Liberalism is a kind of personal cultivation, and it is self-discipline that does not interfere with others’ freedom.” That is to say, liberalism is self-disciplined, then this It is a moral cultivation. Just as Hu Shi said just now, “Afraid of Wife” is the same reason – “Afraid of Wife” is the self-discipline of men. So, I said this is the second rule of civilization. The second rule of civilization, I have a summary: “The true meaning of civilization is not the superiority of the technology as a production tool, but the moral power that does not abuse people’s advantages when they have the advantages of resources, of technology, and of institutions.” This second rule of civilization really makes our society and our world move toward civilization.

Putting this topic a little further is between countries. People are not the same, so countries are even more different. In economics, there are many dogmas about free trade, but there are actually big problems. One dogma is that equalization of factor income can be achieved through free trade; in other words, as long as we pass free trade, we can make the wages of all countries equal and the people of all countries have the same income level. This sentence should be wrong. Why? Just said, because international trade is different from domestic trade. International trade has borders between countries. There is an obstacle to the border between countries, which cannot be overcome: people cannot flow freely and cannot immigrant freely. The market economy within a country is effective because it is free to immigrate at home.

We can recall the situation in China: Why has China changed so dramatically in 40 years, but there is no regional contradiction? Because if there is a rich place, people from other places can go there to work. We have experienced a very significant urbanization these years. What is “urbanization”? It is the moving of people in low-income places toward places with high incomes. If China is divided into two parts, one is the west and the other is the east, then we will find that the border between the east and the west will be like the US and Mexico borders. This kind of national border restrictions on free immigration makes free trade impossible to achieve the results of the joys of all peoples.

This conclusion is also emphasized by another economist, Krugman. He is the winner of the 2008 Nobel Prize in Economics and his contribution is the “New Trade Theory.” He has a very simple theory: “If two countries are big and small, and other conditions are the same, then the big country will have an advantage in free trade.” Of course, there is a very complicated theory behind this theory. I only want to say that the big congress has a larger market, and the larger market will have more demand, and then it will bring larger enterprises, larger industries, will bring about a kind of “scale economy”, which will bring about the decline of average cost, which will bring advantages in the international market competition.

From this theory, the world has large and small, all kinds of countries. According to this theory, the competitiveness of different countries will certainly not be the same. What’s more, there are other differences between countries and countries, some are more developed, some are not developed enough, and so on.

Therefore, in this sense, when we talk about free trade, we must pay attention to it. Until today, the world has not reached what economists call “the result of ideal free trade” because there are many specific situations. Therefore, free trade will lead to some countries gain more income, some countries may get less income, and there will be no results to make everybody’s happy. We should pay special attention to this.

However, it should be said that human beings have been developing for thousands of years. The pattern of international trade that we have seen today is actually not seen in history. It can be found that there are many times historically, for unbalance of trade, that people use national power, use violence and force, and even create war between nations, .As long as we look back over the past few hundred years, we can see that many wars are caused by trade, because they compete for trade monopolies, compete for control over trade routes, or trade imbalances. For example, China’s past Silk Road is a very wealthy road, but it is often robbed by robbers, so this road needs to be protected. Then this road may also be placed under the control of certain military groups, which are all to compete with each other.

In the West in modern times, many wars have also started because of trade. The hegemony of Western countries such as Spain, the Netherlands and the United Kingdom at sea is actually the control of trade monopoly  and trade routes. Between the East and the West, the use of state power to influence trade, and even the war between East and West countries, are actually related to trade imbalances.

The Chinese are very smart and have a long tradition of doing business. Our very early ancestor was called “Yin Shang”. At that time, the people of the time called “Businessman”, the word was passed down. Why are they called “businessmen” because they do trade, we actually have a very long history of trade. China is very special in history and is indeed the “biggest country” with a vast territory. In the historical development process of Zhou, Han, Tang and Song, it became a place where production was relatively leading and the country was relatively rich. So in the 16th to 18th centuries, China’s trade has actually been in surplus. At the time, there were no products in the West that could rival large-volume products such as silk, tea, and porcelain. It was not available before the Industrial Revolution. So from the 16th to the 18th century, China had always had a very large trade surplus. The main product that the West could trade with China at the time was silver. This is because the Europeans discovered the Americas and developed silver in the Americas. At that time, about half of silver in the international trade went to China.

However, in the era of precious metals, this situation has brought a lot of negative impacts on other countries, because the trade deficit has brought about currency outflows and deflation, which has limited economic development. For example, the United Kingdom, because the United Kingdom does not have silver, at most relying on pirate ships to grab the silver of Spanish merchant ships, but they found something – opium. Everyone knows about the Opium War. The British say this is a trade war. In this sense, it is also true. Because opium has caused the UK to reverse the trade deficit, China’s surplus has turned. In short, there have been many wars in history due to trade.

In this sense, we look back, human beings have been going to the 20th century, and today’s WTO system is indeed more civilized than before. We must cherish such a civilized system.

There is a special phenomenon in the history of trade. Some countries with relatively advanced, rich, or large-scal, may at some time, for some reason, use the domestic market as a market for other emerging countries. These countries, including China and India in the 18th and 19th centuries, were like this, and their markets nurtured the industrial countries of the time. Of course, it is only a kind of nurturing under the conditions of violent means to lower tariffs.

Of course, this matter is not good for China. On the other hand, it is unfavorable for a country to have too much deficit of trade. Such a country not only loses the development of many enterprises, but also loses its currency. As I said earlier, in the past international trade, precious metals as a currency, if it flowed out of China, then China reduced the money supply – an important point of economic development is the increase in money supply – if the precious metals flow out, then the country It is going to fall into deflation. This is also a contradiction.

So how to solve this problem? In the 20th century, it should be said that there is still a solution, that is, the American approach. The US approach is very interesting. The United States is in this era. This era is no longer the era of precious metals as a currency, so it uses paper money to pay for the trade deficit. Everyone knows that the modern currency has finally become a banknote. This banknote is of course issued by the central bank. It controls the interest rate and controls the quantity issued to ensure the stability of the currency value. This is exactly the same as the precious metal, just because it brings you some kind of trust. But at the same time, this is also very good – in this way, the country can withstand more trade deficits. Everyone needs to know that the United States has been a trade deficit since the 1960s, and it has been more than half a century. It should be said that this on one hand has provided a market for China’s rise, and on the other hand has not caused the US economy to decline. So, in this sense, it should be said that this is a very good model. But this model still has problems: the Sino-US trade war we see today is such a problem.

We humans must continue to move toward civilization, how to solve the problems in international trade – that is, such an uneven international trade, the advantages and disadvantages of different countries in international trade, it need indeed  these new rising countries think about. One of the important points is the second rule of civilization that I just emphasized – you can’t just decide your behavior with your own interests, you must jump out of the unilateral interests, and you must consider issues from protecting the rules which make all human beings better, and from a global perspective. At this time, it is impossible to simply be as an “economic man” and only follow the current trade rules; but should become a very responsible country that advances the development of human civilization. If doing this, it will make a new contribution to human civilization.

(This article is the author’s speech on January 9th, 2019 in the “Economic Observer Report on the 2018 Good Book Awards”, which was edited by the author.)

The Nature, Performance, and Reform Of the State-owned Enterprises

国企报告英文版封面

The Nature, Performance, and Reform Of the State-owned Enterprises

Second Edition

By the Unirule Institute of Economics

Abstract

The state-owned and state-holding industrial enterprises made a total profit of 12002.7 billion yuan from 2001 to 2013, with the total book profit of 2013 increased by 5.36 times over that of 2001. The total net profit amounted to 8608.6 billion yuan, with the total book net profit of 2013 increased by 6.12 times over that of 2001.

From 2001 to 2013, the average return on equity of state-owned and state-holding industrial enterprises was 9.08%, while that of industrial enterprises above designated size was 15.67%. 2013,that of the former is 8.73%, while that of the latter is 15.64%. Therefore, the nominal performance of state-owned and state-holding enterprises was not high enough.

Even the performance of state-owned enterprises is not their real performance, but one after enjoying various preferential policies and under such a management environment which is unfair to non-stated-owned enterprises. The unfairness is mainly embodied in fiscal subsidy by the government, financing cost, and land and resource rent, and so on.

If we compute the industrial land rent at 3% of the price of the industrial land, state-owned and state-holding industrial enterprises should pay a total rent of 6424.0 billion yuan from 2001 to 2013, accounting for 53.5% of the total nominal profits made by state-owned and state-holding enterprises. Only in 2013, the state-owned enterprises should pay 1240.9 billion yuan rent for the land if we add the land for commercial and service use into the whole amount.

The real interest rate for state-owned and state-holding enterprises is 1.6%, while that market interest rate is 4.68%. If we recount the interests which should paid by state-owned and state-holding industrial enterprises with the market interest rate, the total interest difference will be 5712.4 billion yuan from 2001 to 2013, accounting for 47.59% of the total nominal profits made by state-owned and state-holding enterprises.

The resource tax of oil is average only 26 yuan per ton. The resource compensation fee is merely 1% of sales revenue. Therefore, the real royalty of oil in China is less than 2% of its price, far below the ratio of 12.5% which is imposed on the capital venture in China. Even collection proportion for special oil gain levy below 40 dollars is too low to fully realize interests of resource owners. From 2001 to 2013, the state-owned and state-holding industrial enterprises lack to pay 560.3 billion yuan of the oil royalty. Together with those of coal and natural gas, the state-owned and state-holding industrial enterprises lack to pay 1113.8 billion yuan of royalty of resources..

From 1994 to 2006, the state fiscal subsidy for the losses of state-owned enterprises accumulated to 365.3 billion yuan. According to incomplete data, from 2007 to 2013, the state-owned and state-holding industrial enterprises received fiscal subsidy is about 274.1 billion yuan.

The real performance of state-owned enterprises can be estimated through deducting those costs without paid but should be paid and governmental subsidies, together achieving about 14975.4 billion yuans, from nominal profit of the state-owned enterprises. According to our estimation, the average real return on equity of state-owned and state-holding enterprises from 2001 to 2013 is-3.67%.

Real return of net assets

In 2013, the average staff wage of state-owned enterprises was 3% higher than that of other organizations, the average labor income of state-owned enterprises is 24% higher than that of private enterprises and 234% higher than that of non-state-owned enterprises. There is a big difference between the industries. 2008, the average income per year of employees in monopolistic industries reached 128.5 thousand yuan, which is about 7 times as that of the employees in the whole country. The ratio of the state-owned enterprises in 5 industries with highest income is highest, while that in 5 industries with lowest income is lowest.

According to regulations of existing housing provident fund system, the housing provident fund deposit ratio paid and deposited by staff themselves as well as that paid and deposited by units should be no less than 5% of the staff’s average monthly salary of the previous year, and no more than 12% in principle. A large number of state-owned enterprises and institutions of monopoly industries, however, raise this ratio to 20%. China Netcom Operations Limited once accrued 4.142 billion yuan at total amount as lump-sum cash housing allowance. State-owned enterprises also conduct residential building construction with raised funds on gratis land from free allocation by the state. In addition, some enterprises purchase commercial residential buildings and sell them to their own staff and workers at low price.

From 2007 to 2009, the average tax burden of 992 state-owned enterprises was 10%, while that of private enterprises was as high as 24%.

State-owned enterprises did not turn over any profits from 1994 to 2007. In 2009, only 6% of state-owned enterprises’ profits were turned over, and the rest was all distributed within enterprises. In 2010, it decreases to 2.2%, and then increases to 5.36 in 2013. Moreover, dividend turnover by central enterprises mainly transfers within the central enterprise system. Their significance in benefiting the common people has not been embodied yet.

Structural “Guo Jin Min Tui” phenomenon currently exists in our country. In terms of capital, the proportion of state-owned enterprises in electric power, steam, and hot water production and supply industries rose from 85.8% in 2005 to 90.3% in 2012. In terms of gross industrial output value, the proportion of state-owned enterprises in electric power, steam, and hot water production and supply industries increased from 89.3% in 2005 to 93% in 2008. The proportion of state-owned enterprises in oil and gas industry increased from 90.5% in 2005 to 98.9% in 2006, it decreases to 92.1% in 2011.

The quantitive analysis with the term, market power, on the monopolistic levels of industries shows that colored metal smelting and pressing industry, tobacco industry, oil processing industry, coking industry, nuclear fuel industry, and electric machinery industry, and so on, the monopolistic level in 2007 is higher than that in 2002. These industries are overlapped very much with those with higher ratio of the state-owned enterprises.

A resume survey of officials of ministries and commissions under the State Council shows that among 183 officials above vice ministerial level of 19 ministries and commissions, 56 people have working experiences in state-owned enterprises, the proportion for which is as high as 30.6%. In addition, a resume survey of senior executives of 123 central enterprises shows that 115 senior administrators of 47 enterprises with information disclosure have government working background, that is, each enterprise has an average of 2.45 people with such background. Therefore, identity exchange exists between management staff of state-owned enterprises and government officials.

Enterprise senior executives enter the government for policies and resources, while governmental officials enter enterprises to materialize their economic profits earned while in the position.

Administrative departments have rights to formulate regulations on the implementation of laws, instruction opinions, and departmental regulations, i.e. In other words, administrative legislation exists. Enterprise management needs to lobby the administrative departments instead of the legislature. In other words, there are “lobbying within the house.”

State-owned enterprises should have a rather clear boundary that they are suitable for production of public goods and quasi public goods in which market mechanism could not be brought into full play. Products which are purchased solely by governments or which should be stringently controlled during production progress should be supplied by state-owned enterprises, while other products should be supplied by private economy. The condition for existence of state-owned enterprises is when they supply public goods and the financing stage and can not be separated from the production stage.

The state-owned enterprise is a public organization different from ordinary governments or enterprises, whose aim is to realize public good of society rather than to make profits.

The nature of China’s current state-owned enterprise reform is capitalization of state-owned assets, that is, making profits through management of state-owned assets. Therefore, the government gradually turns into personalized or institutionalized capital when state-owned assets constantly show the attributes of capital.

As the main content of China’s market-oriented reform, the reform orientation choice of state-owned assets capitalization had both logical inevitability and historical progressiveness especially at the primary stage of China’s economic transition. However, with the establishment of market economy in our country, the historical mission of state-owned enterprise reform characterized by state-owned assets capitalization is about to come to an end. 

We should design the short-term reform plan for state-owned enterprises based on two major objectives, namely, breaking the administrative monopoly by state-owned enterprises, and regulating state-owned enterprises’ behaviors. The significance lies in that this will promote different economic main bodies to carry out adequate and fair economic competition, thus better realizing social justice and improving economic efficiency.

State-owned enterprise reform has two ultimate goals. The first goal is to change state-owned enterprises into non-profit public law enterprises, and the second one is to build up the constitutional governance framework for state-owned assets.

To realize the ultimate goal of reform, state-owned enterprises have to gradually retreat from the profit-making fields (rather than merely the competitive fields).

【正心诚意】养其身以有为|盛洪

竹子4

养其身以有为

——《天则年鉴》(2018年)序

盛 洪

        刚刚过去的一年,也许是天则所历史上最为艰难的一年。磨难接踵而来,我们几乎没有喘息的时间。人们也许会问,上帝还在吗?答曰,还在。那为什么会有这么多磨难?答曰,为了让人们幸福。仔细想一想,万能的上帝给我们一个现成的理想社会不是轻而易举的吗?只是衪认为,人们最幸福的事情,莫过于享受向理想社会努力的过程。所以祂必须给我们一个不理想的社会,以成全我们的成就感。

       想想应是如此。我们用善意回敬恶意,用法治对抗蛮力,用良知激发良知。我们维护自己的权利,也让别人知道什么是权利。我们如此微小,但护卫的道却无边无际。更在磨难之中,我们完成了给自己规定的任务。我们感到自豪。

       人间早有人窥见天意。孔子讲“儒行”,那是行为的审美。他说“爱其死以有待也,养其身以有为也。”意思是“人要生,生要为。”“为”就是走向理想社会的努力,也是漂亮的行为。

       在章太炎先生看来,事情太易成功,并非好事。他说“譬如辛亥革命侥幸成功,为时太速,所以当时革命诸人多半未经历练,真才不易显出。”越难成功,越需努力,越显英雄本色。

       去年我们不过是过了一个增加难度的关。我们的努力与其他人一起推动了一些事情,如减税的承诺,民企的安抚,农村集体土地的交易权与开发权的法定,以及司法黑幕的揭露。这是对磨难的回报,也是我们的成就感所在。

       新的一年,我们不知道磨难的程度是增加还是减少。这不是我们能决定的,也不重要。重要的是,我们知道,我们要生,生则为。我们能决定的,就是“养其身以有为也。”

 

2019年1月23日于五木书斋

 

A Theoretical Analysis, Performance Evaluation, And Reform Solution on Health Care System in China

我国医疗制度的理论研究、效果评价与改革方案

A Theoretical Analysis, Performance Evaluation,
And Reform Solution on Health Care System in China

天则经济研究所课题组

Research Team of Unirule Institute of Economics

Abstract

● The market for healthcare features uncertainty, lack of price elasticity, and information asymmetric, besides other market characteristics.

● The purpose of medical insurance is to eradicate uncertainty and bring about the utility of certainty by transforming the uncertainty of personal medical affairs into predictable risks through integration and professionalization.

● People tend to “buy more” and “buy the expensive” as insurances lower the part of the medical expenses borne by the individuals, which in effect pushes up the prices of health care, and the demand for medical services and goods. The overall effect is an increase of health care expenditure.

● Insurances pushes up 89% of the prices of China’s medical services and goods, leading to an over-expenditure of 16% of all the medical services and goods by consumers, which further increases the healthcare expenditure per capita to 119% of that without these insurances .

● Even though insurances bring about an increase of welfare by 2.25% of the GDP, compared to the loss caused by it, a net loss of some 0.46% of the GDP, that is some RMB264 billion, is caused by insurances.

● By 2013, a total of some RMB45.7 billion has been wasted by the public healthcare system.

● The managerial cost of healthcare institutions, i.e., expenditure by healthcare administrations and cost of managing the healthcare insurances, skyrocketed year on year, and reached RMB 43.7 billion in 2014.

● Per capita medical expenses are rising, from 4.03% in 2008 to 5.22% in 2015. In 2015, the national total health expenditure accounted for 6.05% of GDP.

● Therefore, it is not enough to criticize only the use of healthcare insurances. See below:

Weighing the Gains and Losses of Insurance. Unit: Percentage of GDP per capita(%)

保险利弊

● Quality medical resources concentrate disproportionately in big cities and big hospitals, which causes insensible spatial allocation causing an overly high time cost and other indirect medical cost. In 2013, if we put together the overspent cost and time for local and cross-region healthcare services and goods, it equaled to a total waste of resources that priced some RMB445.2 billion a year.
● The growth of labor costs for doctors is lower than that of the per capita GDP. The proportion of labor costs for doctors in per capita GDP fell from 11.7% in 2002 to 3.3% in 2015.
● In an aggregate sense, the demand for healthcare increased 40 times from 1980 to 2014, while the number of licensed doctors only increased 1.51 times. Demand surpassed supply by a large margin.

● Average healthcare resources are distributed in a balanced manner across regions. It coincides with the resource allocation planning approach based on population taken by the Chinese government.

● Quality healthcare resources are distributed in a very imbalanced term with more resources concentrated in administrative centre. And this situation is exacerbating.

● Beijing is the “utmost unfair benefactor” of this distributional system of healthcare finance, while the “unfair victims” include provinces such as Henan, Anhui, Hebei, Hunan, Jiangxi, Guizhou and Shandong.

● The unfairness index of the financial distribution system in the healthcare system is 0.344. According to our evaluation standard, this score is interpreted as intermediate.

● Civil servants are the “utmost unfair benefactor” in the current healthcare financial distribution system, while the “unfair victims” include farmers, urban residents, and urban workers.

● This research proposes the basic principles for institutional healthcare reform is taking the market institution as the basis, and government regulations as complement.

1. To increase the self-pay ratio and its scope, to enlarge the function of the market;
2. To facilitate the market competition for healthcare;
3. To let the market make the price for healthcare services under the market mechanism;
4. To let the price of medicines fluctuate when the market makes prices for healthcare services;
5. To abandon compulsory social insurance and rely more on commercial insurance institutions;
6. The government should subsidize the medicine fees for the poorest people.

● The main measures proposed by this research include:

1. Canceling the insurance covering out-patient medical services: the fee inflicted by out-patient medical treatment can be paid either by the patients or by the individual account;
2. Canceling the threshold for insurance coverage and raise the self-pay ratio for in-patients to 70%;
3. Setting up a national severe disease charity fund to subsidize those whose self-pay portion exceeds their yearly income’s 40%.

● Estimated according to the model in this research, setting 2014 as the baseline, the proposal of this research should be able to hold back a 75% increase of the price, which would save RMB 1,294.7 billion, 2% of the GDP.

● It would hold back some 13.2% of healthcare overuse, which would save up to RMB 217.8 billion, about 0.34% of the GDP.

● Some RMB1,12.1 per person would be saved for healthcare, about 2.37% of GDP per capita, which rounds up to some RMB1,237.6 billion nationwide.

● Those whose self-pay proportion exceeds their yearly income’s 40% constitute about 2.25% of the total population. If a severe disease fund is set up with a scale of about RMB 200 billion, it will be only about 0.3% of the GDP.

● If the monopoly is eliminated and competition is promoted, then everyone would be able to save about RMB 7.3 for healthcare, a total RMB10 billion nationwide.

● Healthcare resources will be better allocated in space. If the distance and waiting time for medical treatment is shortened by half, that is the 4 hours needed for local treatment is shortened to 2 hours, then a total value of time amounting to about RMB 266.2billion will be saved; if the distance and waiting time for cross region treatment is shortened from 12.5 days to 6days and 6 hours, when a total value of time amounting to about RMB 29 billion will be saved. Putting them together, a total waste of time estimated for the value of RMB 295.2 billion will be avoided.

● Canceling out-patient (small illness) insurance would reduce 2/3 of the current insurance-related managerial operations, saving a total of RMB16.9 billion according to the current administrative fees of insurance agencies that is RMB 25.4 billion.

● When the increase of healthcare expenditures is contained, a huge amount of resources are saved, which will bring back the advantages of insurances. See blow.

Situation after the Reform Unit: Percentage of GDP per capita(%)

保险改革

● In summary, this reform proposal will reduce per capita medical expenses from 5.08% to 2.71% of the per capita GDP, a decrease of 46.7%.

● This reform proposal will also reduce the per capita medical expenses originally covered by insurance from 3.1% to 1% of the per capita GDP, a decrease of 68.5%.

● If it is shown by the deduction of healthcare insurance fees for urban workers, the deduction from their monthly wage will be decreased from 9.5% to 3% of their monthly wage, which would also lower the burden for enterprises.

● Even though the self-pay fees account for a higher ratio than before, as the healthcare expenditure decreased in general, patients pay 86.2% of that they paid for their medical treatments before the reform.

The Nature, Performance, and Reform Of the State-owned Enterprises |Unirule

 

国有企业的性质、表现与改革

(第二版)H

The Nature, Performance, and Reform of the State-owned Enterprises

Second EditionG

By the Unirule Institute of Economics

天则经济研究所课题组

20151230

 

Abstract

The state-owned and state-holding industrial enterprises made a total profit of 12002.7 billion yuan from 2001 to 2013, with the total book profit of 2013 increased by 5.36 times over that of 2001. The total net profit amounted to 8608.6 billion yuan, with the total book net profit of 2013 increased by 6.12 times over that of 2001.

From 2001 to 2013, the average return on equity of state-owned and state-holding industrial enterprises was 9.08%, while that of industrial enterprises above designated size was 15.67%. 2013,that of the former is 8.73%, while that of the latter is 15.64%. Therefore, the nominal performance of state-owned and state-holding enterprises was not high enough.

Even the performance of state-owned enterprises is not their real performance, but one after enjoying various preferential policies and under such a management environment which is unfair to non-stated-owned enterprises. The unfairness is mainly embodied in fiscal subsidy by the government, financing cost, and land and resource rent, and so on.

If we compute the industrial land rent at 3% of the price of the industrial land, state-owned and state-holding industrial enterprises should pay a total rent of 6424.0 billion yuan from 2001 to 2013, accounting for 53.5% of the total nominal profits made by state-owned and state-holding enterprises. Only in 2013, the state-owned enterprises should pay 1240.9 billion yuan rent for the land if we add the land for commercial and service use into the whole amount.

The real interest rate for state-owned and state-holding enterprises is 1.6%, while that market interest rate is 4.68%. If we recount the interests which should paid by state-owned and state-holding industrial enterprises with the market interest rate, the total interest difference will be 5712.4 billion yuan from 2001 to 2013, accounting for 47.59% of the total nominal profits made by state-owned and state-holding enterprises.

The resource tax of oil is average only 26 yuan per ton. The resource compensation fee is merely 1% of sales revenue. Therefore, the real royalty of oil in China is less than 2% of its price, far below the ratio of 12.5% which is imposed on the capital venture in China. Even collection proportion for special oil gain levy below 40 dollars is too low to fully realize interests of resource owners. From 2001 to 2013, the state-owned and state-holding industrial enterprises lack to pay 560.3 billion yuan of the oil royalty. Together with those of coal and natural gas, the state-owned and state-holding industrial enterprises lack to pay 1113.8 billion yuan of royalty of resources..

From 1994 to 2006, the state fiscal subsidy for the losses of state-owned enterprises accumulated to 365.3 billion yuan. According to incomplete data, from 2007 to 2013, the state-owned and state-holding industrial enterprises received fiscal subsidy is about 274.1 billion yuan.

The real performance of state-owned enterprises can be estimated through deducting those costs without paid but should be paid and governmental subsidies, together achieving about 14975.4 billion yuans, from nominal profit of the state-owned enterprises. According to our estimation, the average real return on equity of state-owned and state-holding enterprises from 2001 to 2013 is-3.67%.

In 2013, the average staff wage of state-owned enterprises was 3% higher than that of other organizations, the average labor income of state-owned enterprises is 24% higher than that of private enterprises and 234% higher than that of non-state-owned enterprises. There is a big difference between the industries. 2008, the average income per year of employees in monopolistic industries reached 128.5 thousand yuan, which is about 7 times as that of the employees in the whole country. The ratio of the state-owned enterprises in 5 industries with highest income is highest, while that in 5 industries with lowest income is lowest.

According to regulations of existing housing provident fund system, the housing provident fund deposit ratio paid and deposited by staff themselves as well as that paid and deposited by units should be no less than 5% of the staff’s average monthly salary of the previous year, and no more than 12% in principle. A large number of state-owned enterprises and institutions of monopoly industries, however, raise this ratio to 20%. China Netcom Operations Limited once accrued 4.142 billion yuan at total amount as lump-sum cash housing allowance. State-owned enterprises also conduct residential building construction with raised funds on gratis land from free allocation by the state. In addition, some enterprises purchase commercial residential buildings and sell them to their own staff and workers at low price.

From 2007 to 2009, the average tax burden of 992 state-owned enterprises was 10%, while that of private enterprises was as high as 24%.

State-owned enterprises did not turn over any profits from 1994 to 2007. In 2009, only 6% of state-owned enterprises’ profits were turned over, and the rest was all distributed within enterprises. In 2010, it decreases to 2.2%, and then increases to 5.36 in 2013. Moreover, dividend turnover by central enterprises mainly transfers within the central enterprise system. Their significance in benefiting the common people has not been embodied yet.

Structural “Guo Jin Min Tui” phenomenon currently exists in our country. In terms of capital, the proportion of state-owned enterprises in electric power, steam, and hot water production and supply industries rose from 85.8% in 2005 to 90.3% in 2012. In terms of gross industrial output value, the proportion of state-owned enterprises in electric power, steam, and hot water production and supply industries increased from 89.3% in 2005 to 93% in 2008. The proportion of state-owned enterprises in oil and gas industry increased from 90.5% in 2005 to 98.9% in 2006, it decreases to 92.1% in 2011.

The quantitive analysis with the term, market power, on the monopolistic levels of industries shows that colored metal smelting and pressing industry, tobacco industry, oil processing industry, coking industry, nuclear fuel industry, and electric machinery industry, and so on, the monopolistic level in 2007 is higher than that in 2002. These industries are overlapped very much with those with higher ratio of the state-owned enterprises.

A resume survey of officials of ministries and commissions under the State Council shows that among 183 officials above vice ministerial level of 19 ministries and commissions, 56 people have working experiences in state-owned enterprises, the proportion for which is as high as 30.6%. In addition, a resume survey of senior executives of 123 central enterprises shows that 115 senior administrators of 47 enterprises with information disclosure have government working background, that is, each enterprise has an average of 2.45 people with such background. Therefore, identity exchange exists between management staff of state-owned enterprises and government officials.

Enterprise senior executives enter the government for policies and resources, while governmental officials enter enterprises to materialize their economic profits earned while in the position.

 Administrative departments have rights to formulate regulations on the implementation of laws, instruction opinions, and departmental regulations, i.e. In other words, administrative legislation exists. Enterprise management needs to lobby the administrative departments instead of the legislature. In other words, there are “lobbying within the house.”

State-owned enterprises should have a rather clear boundary that they are suitable for production of public goods and quasi public goods in which market mechanism could not be brought into full play. Products which are purchased solely by governments or which should be stringently controlled during production progress should be supplied by state-owned enterprises, while other products should be supplied by private economy. The condition for existence of state-owned enterprises is when they supply public goods and the financing stage and can not be separated from the production stage.

The state-owned enterprise is a public organization different from ordinary governments or enterprises, whose aim is to realize public good of society rather than to make profits.

The nature of China’s current state-owned enterprise reform is capitalization of state-owned assets, that is, making profits through management of state-owned assets. Therefore, the government gradually turns into personalized or institutionalized capital when state-owned assets constantly show the attributes of capital.

As the main content of China’s market-oriented reform, the reform orientation choice of state-owned assets capitalization had both logical inevitability and historical progressiveness especially at the primary stage of China’s economic transition. However, with the establishment of market economy in our country, the historical mission of state-owned enterprise reform characterized by state-owned assets capitalization is about to come to an end.

 We should design the short-term reform plan for state-owned enterprises based on two major objectives, namely, breaking the administrative monopoly by state-owned enterprises, and regulating state-owned enterprises’ behaviors. The significance lies in that this will promote different economic main bodies to carry out adequate and fair economic competition, thus better realizing social justice and improving economic efficiency.

State-owned enterprise reform has two ultimate goals. The first goal is to change state-owned enterprises into non-profit public law enterprises, and the second one is to build up the constitutional governance framework for state-owned assets.

To realize the ultimate goal of reform, state-owned enterprises have to gradually retreat from the profit-making fields (rather than merely the competitive fields).

 

Table of Contents

Preface

Chapter 1 Theory and process of state-owned enterprises reform

  1. Reform of state-owned enterprises: “decentralizing powers and giving up profits” as the main feature;
  2. Reform of state-owned enterprises: “separating control from ownership” as the main feature;
  3. Reform of state-owned enterprises: “establishing modern enterprise system” as the main feature;
  4. Policies’ impulse in process of the reform

Chapter 2 Classification of state-owned assets and state-owned enterprises

  1. Classified by the nature of assets;
  2. Classified by the management division.

Chapter 3 Performance of state-owned enterprises: Efficiency

  1. Review of the research on the efficiency of state-owned enterprises;
  2. The approach of this report on efficiency;
  3. The nominal performance of the state-owned and state holding industrial enterprises;

4.Being real: costs without paid but should be paid and subsidies;

  1. Discussion on the “enterprise as society” and “the burden of retired workers”;
  2. The real performance of the state-owned and state holding industrial enterprises;
  3. Summary.

Chapter 4 Performance of state-owned enterprises: Distribution

  1. The influence of subsidies and costs without paid but should be paid on distribution from the perspective of national income;
  2. The monetary and non-monetary income of state-owned enterprises;
  3. Comparison of income of senior managers between state-owned enterprises and other types of enterprises;
  4. Comparison of the tax payment between state-owned enterprises and other types of enterprises;
  5. The profits payment and dividends of state-owned enterprises;
  6. Summary.

Chapter 5 “Guo Jin Min Tui” and its impact on market competition: The nature of “Guo Jin Min Tui” and relevant case studies

  1. Characters of “Guo Jin” of state-owned enterprises in recent years;
  2. Typical cases about “Guo Jin”;
  3. Analysis of the phenomenon “Guo Jin”

Chapter 6 The impact of state-owned enterprises on macro economy

  1. The integration of state assets and “economic fragility”;
  2. The impact of current performance of state-owned enterprises: real estate market;
  3. The impact of current performance of state-owned enterprises: finance market and take securities market as an example;
  4. The impact of current performance of state-owned enterprises: bulk stock; 

Chapter 7 The analysis of political economy on the performance of state-owned enterprises

  1. The historical starting point of current issues of state-owned enterprises;
  2. The institutional background of state-owned enterprises in early 1990s;
  3. The interest groups of management under the distorted institutional background of state-owned enterprises;
  4. The identity exchange of state-owned enterprise managers and government officials;
  5. The “lobbying within the house” of management in state-owned enterprises;
  6. The constitutional defects of China’s government: “department legislation”.

 Chapter 8 The nature of state-owned enterprises: the perspective of economics 

  1. The nature of enterprises;
  2. The nature of state;
  3. The nature of state-owned enterprises;
  4. The boundary of state-owned enterprises;
  5. The constitutional relationship between state-owned enterprises and government.

Chapter 9 The nature of state-owned enterprises: the perspective of law science

  1. The state-owned enterprises as a special public institution;
  2. The normative significance of the state-owned enterprises as a special public institution;
  3. The strategic significance of reaffirming the public nature of state-owned enterprises for China’s state-owned enterprises reform;

Chapter 10 Deepening the reform of state-owned enterprises

  1. The reflection and comments on the reform of state-owned enterprise;
  2. The short-term plans of state-owned enterprises reform;
  3. The ultimate goals of state-owned enterprises reform.

References

Appendix

 Sub report 1: Comments on the mission of state-owned enterprises

Sub report 2: The authority and role conflict of the State-owned Assets Supervision and Administration Commission of the State Council (SASAC)

 Sub report 3: The rent loss of China’s industrial land and commercial land

 Sub report 4: The evolution of policies towards state-owned enterprises by government