The other day a friend commented to me that some are arguing that the US is becoming more and more socialist by the day with the federal bailouts of Fannie and Freddie and IndyMac, plus all of the other banks. I chuckled and conceded Fannie and Freddie, but noted all the other banks are merely being bailed out by the FDIC which has had the mandate to do this since its inception under the New Deal legislation of the 1930s. We agreed, both on fact and the humor of the situation.
In an opinion piece in today's Shanghai Daily, Rosy statistics mask not-so-pretty picture, Wu Jiayin expresses concern over the statistics purportedly indicating an increase in living standards for Chinese people, and concern that China is not spending enough on its citizens welfare.
The gist of the salary concerns:
The trick lies in the statistics themselves. The 18 percent increase refers only to the salaries earned by "urban workers," a term that excludes migrant workers, self-employed business people, and anyone working in the private sector.
With CPI clocking a 7.9% increase in the year to date, Mr. Wu worries that the Chinese people not included in the salary study aren't able to keep up with rising costs. Mr. Wu writes that this would be alright if China spent proportionally as much or more on its citizens medical health, social security and employment. But China spends proportionally less than the US, with medical health, social security and employment expenditures accounting for 15% of total expenditure, 2.4% of GDP, and expenditure per person accounting for 3% of the annual income of an average worker. In the US the respective expenditures are 61%, 11.5%, and 17%.
I like the way Mr. Wu ends his article:
It is just because China is not as rich as the US that the former should spend more of its income on the well-being of its people.But, as of present the amount that the US spends on technologically advanced medical procedures, and the amount that the EU and US spend on pharmaceutical R&D means that US expenditures include subsidies of technologies that benefit the whole world, and not just its own citizens. And I would certainly argue that our relative wealth means that we should be spending more to improve the health of all.