Monday, November 14, 2011

Could we see a Chinese Welfare State introduced as a demand-booster?

"Rather than simply saying the Chinese are Confucianists and Confucianists save money, I’d say there are very specific things that make them anxious, and so they save money. So they save for a place to live, for their kids’ education, for unforeseen medical expenses, and retirement. This is something that people who used to work for state industries never had to worry about, because it was provided. The state is now toying with the idea of reinstating these safety nets, not out of the goodness of their hearts, but to free up capital so that people will spend more money."

Karl Gerth

1 comment:

James Higham said...

I see it more as a collapsing state in the near future - possibly held off over the olympics and then bye bye Britain.