Wei Jingsheng Foundation News and Article: A1663-W1202

魏京生基金会新闻与文章发布号：A1663-W1202

Release Date: May 25, 2024

发布日：2024年5月25日

Topic: How to Solve the Mortgage Crisis in China -- Wei Jingsheng

标题：房贷危机如何解决 -- 魏京生

Original Language Version: Chinese (Chinese version at the end)

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How to Solve the Mortgage Crisis in China

-- Wei Jingsheng

The major economic crisis now threatening the Chinese people has erupted in the form of unfinished buildings. It seems that this is different from the economic crisis the United States had, but it is actually the same thing: both were caused by overproduction and under-consumption, and the economy has entered a vicious cycle.

The economic crisis in the United States in the 1930s used the so-called Keynesianism. To put it bluntly, it is to continuously issue excessive amounts of money to create inflation, and at the same time use ideological means to encourage excess consumption, thereby gradually digesting excess production and restoring balance.

After that, the United States established a variety of forecasting institutions at the national level to guide private producers: try to maintain a balance between production and consumption, reduce or even eliminate the imbalance that causes crises, and maintain a generally virtuous cycle of capital.

This time, China's real estate crisis is mainly caused by two aspects. The first aspect is that the government agencies responsible for guiding production encouraged "go fast in a big quantity" from a policy perspective. In the 1950s, the Chinese Communist Party (CCP) mainly harmed agriculture and farmers, ending up with tens of millions of people starving to death. This time, the rapid development will harm the entire economy, which is dominated by industry. Under the slogan "go fast in a big quantity", the extraordinary expansion of infrastructure and real estate in China has given good looking and proud GDP results.

The second frightening aspect that has caused serious crises is the semi-market economic system dominated by directive policy instead of market feedback. This directive policy actually means a planned economic system. The characteristic of this system is that it expands the time and scope of erroneous instructions. In terms of being divorced from market information, it exceeds the extent of the crisis in the United States in the 1930s. Replacing market feedback with instructions from the superiors and being satisfied with false GDP results have accumulated for a long time and eventually exploded.

In a system that relies on complete market feedback to regulate production, GDP is a relatively reliable reference data. But it's just a reference. In a system that does not completely rely on market feedback, its reference value is greatly reduced, and it may even give wrong information. Production guided by wrong information will inevitably produce a large amount of excess. Not only the real estate glut caused by the infrastructure mania, but also the industrial overproduction that will be collectively guarded against by the West, are already endangering more than just China itself.

The results of the hard work of the Chinese people, including entrepreneurs, have been wasted by this wrong system. The fundamental solution is to reform this wrong system and establish a normal market economic system. Only then can this huge waste be fundamentally changed. However, the system of one-party dictatorship relies on the command type economic system as its foundation. Changing the planned economic system will also change the one-party dictatorship.

What to do? Rely on advice from economists? So many experts and scholars have given positive advice over the years. Is it useful? Even Xi Jinping’s close confidant Liu He learned some supply-side reforms from the Americans, but they didn’t have any effect either. Why?

Since there is no broad and accurate market feedback, what does your supply side rely on to reform? Mao Zedong and Xi Jinping, the CCP leaders who are so proud of their achievements, are more concerned about their great achievements instead of food, clothing, housing and transportation of the common Chinese people. Therefore, converting grain and steel production into modern GDP numbers can better satisfy their vanity.

Xi Jinping’s dog-headed advisers have come up with two methods. One is to transfer the crisis outward, and this is the excess export capacity that the United States is taking the lead in resisting. Even if the CCP can control the White House as they boasted, it may not have much effect this time. That is because this time it is related to the life and death of other people -- the possibility of deceiving the people again under the democratic system is zero.

The second is to pass on the crisis to the Chinese people, with the new policy of compulsory trade-in of old for new, including trade-in old houses for new ones, and deceptive practices such as the government buying up unfinished buildings and converting them into low-rent housing. Does it work? It was a failure right from the beginning. Firstly, the Chinese government does not have that much money, and secondly, it is not cost-effective for the Chinese people. Even coercion has little effect. People's money still has to be spent according to market rules.

And the most terrible thing is that corrupt officials at all levels have gained opportunities to enrich themselves and dominate the market by relying on instructions rather than market rules again. A brutal looting will be happening again, not only to the bailout funds raised by the government, but also the poor pockets of the Chinese people.

(This English version is translated by Ciping HUANG, without any compensation. Wei Jingsheng and the Wei Jingsheng Foundation appreciate her decades of contribution, especially for allowing the use and distribution of her translations of these commentaries.)

Original link of this commentary:

https://www.rfa.org/mandarin/pinglun/weijingsheng/wjs-05242024075707.html

To hear Mr. Wei Jingsheng's related commentary, please visit:

http://www.weijingsheng.org/RFA/RFA2024/WeiJS240523onMortgageCrisis.mp3

Related screenshot of Wei Jingsheng’s commentary on RFA website:

http://www.weijingsheng.org/pic/newsletters/newsletters2024/newsletters2024-2/WeiJSonMortgageCrisis240524RFApage.jpg

(Written and recorded on May 23, 2024. Broadcasted by Radio Free Asia on May 24, 2024.)

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中文版

Wei Jingsheng Foundation News and Article: A1663-W1202

魏京生基金会新闻与文章发布号：A1663-W1202

Release Date: May 25, 2024

发布日：2024年5月25日

Topic: How to Solve the Mortgage Crisis in China -- Wei Jingsheng

标题：房贷危机如何解决 -- 魏京生

Original Language Version: Chinese (Chinese version at the end)

此号以中文为准（英文在前，中文在后）

如有中文乱码问题，请与我们联系或访问：

http://www.weijingsheng.org/report/report2024/report2024-5/WeiJS240525onMortgageCrisisA1663-W1202.htm

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房贷危机如何解决

-- 魏京生

现在威胁到中国人民的一大经济危机，是以烂尾楼的形式爆发出来了。看起来这和美国的经济危机不同，实际上是一回事：都是生产过剩消费不足造成的，经济进入了恶性循环。

美国三十年代的经济危机，使用所谓的凯恩斯主义。说白了，就是不断超量发行货币制造通货膨胀，同时利用意识形态手段鼓励超额消费，进而逐渐消化了过剩的生产，恢复了平衡。

在那之后，美国从国家层面建立了多种预测机构辅导私人生产者：尽量保持生产与消费的平衡，减少以至于消灭产生危机的不平衡，保持了大致上的资本良性循环。

中国这次的房地产危机，主要原因来自两个方面。第一个方面，是负责指导生产的政府机构从政策上就鼓励“大干快上”。五十年代，中共主要危害的是农业和农民，以饿死几千万人而告终。这一次大干快上，危害的是以工业为主的整个经济。在大干快上口号下，基建和房地产规模的超常扩大，给出了好看的令人骄傲的GDP成绩。

第二个造成严重危机的可怕的方面，就是以指令性政策代替市场反馈的半市场经济体制，实际上是计划经济体制。这种体制的特点，就是扩大了错误指令的时间和范围，在脱离市场信息的方面，超过了美国三十年代危机的程度。以上级指令代替市场反馈，满足于虚假的GDP 成绩，并且长期积累最终爆发。

在依靠完整的市场反馈调节生产的体制下，GDP是比较可靠的参考数据。但也仅仅是参考。在不完全依靠市场反馈的体制下，它的参考价值大大下降，甚至会给出错误的信息。依靠错误信息指导的生产，必将产生大量的过剩。不仅是基建狂魔带来的房地产过剩，将会被西方集体防范的工业生产过剩，已经是不仅仅危害中国本身了。

人民包括企业家们辛辛苦苦生产的结果，被这种错误的体制浪费了。根本的解决办法，是改革这种错误的体制，建立起正常的市场经济体制，才能从根本上改变这种巨大的浪费。但是一党专政的体制依靠指令性的经济体制作为基础，改掉计划经济体制顺带着就会改变一党专政。

怎么办？依靠经济学家们的建议吗？多年来那么多专家学者给出了正面的建议，有用吗？就连习近平的亲信刘鹤，从美国人那儿学来了什么供给侧改革，也没见有什么效果。为什么？

因为没有广范而准确的市场反馈，你那个供给侧依靠什么来改革？好大喜功的领袖毛泽东和习近平们，更关心的是他们的丰功伟绩，不关心老百姓的衣食住行。所以把粮食和钢铁产量，变换成为现代化的GDP，更能满足他们的虚荣心。

习近平的狗头军师们想出来的办法有两个。一个是向外转嫁危机，这个就是美国带头要抵制的出口过剩产能。即使像他们们吹嘘的能够搞定白宫，这次恐怕也不会有什么效果。因为这次关系到人家的生死存亡，在民主制度下再一次欺骗人民的可能性为零。

第二个就是向人民转嫁危机。什么强制以旧换新，旧房换新房，还有就是政府买下烂尾楼，转做廉租房等等骗人的勾当。管用吗？刚开始就显出了败像。一来是政府没那么多钱，二来是对百姓来说并不合算，就是强迫也没多大效果。老百姓的钱还是得按照市场规律来花。

还有最要命的是，各级贪官污吏们在依靠指令而不依靠市场规律的行动中，又得到了中饱私囊欺行霸市的机会。不仅是政府筹集的纾困资金，就是百姓们可怜的腰包，又要受到一次惨烈的洗劫。

(本评论的英文版本由黄慈萍翻译。魏京生和魏京生基金会感谢她数十年来相关的无偿贡献，特别是使用和发布此译文的许可。)

评论的原始链接：

https://www.rfa.org/mandarin/pinglun/weijingsheng/wjs-05242024075707.html