A Proactive Fiscal Policy and Moderately Loose Monetary Policy

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According to statistics, in June 2012, our flow between the urban and rural farmers workers with 166 million people, more than 600 million of China's annual university graduates, all of whom are in need of employment. Many companies can not absorb the workers, but also a large number of dismissed workers employment at this time there is greater pressure, may have a great impact on the basis of people's livelihood. 58% of the more than 160 million migrant workers, "80", and the first generation of migrant workers and their agriculture are not familiar with, it is difficult to like the first generation of migrant workers to return to rural areas can be naturally but after "80", "90" of migrant workers on the urban working and living there is a strong dependence if they spend a lot of time in the city to find work less than basic survival crisis. these problems are not resolved, social stability will be threatened and the need for making a living, the social organization of various marginalized flooding, a very large threat to social stability.

Employment is the people's livelihood as a large developing country of over one billion people, we always want to employment in a very prominent position to be respected for a "package" plan, although some think that an overreaction, I think is necessary If the decline in economic growth to 6% or less, the consequences will be very serious.

Financial risk, financial risk will suddenly expand when a large number of loss-making enterprises increased. Almost every business has a loan, the bank's support can not be separated. Timely repayment of interest-bearing when normal production and operation, but when loss-making enterprises, the sales revenue, the flow of funds greatly reduce, often can not work to repay the debt on time, these loans will become non-performing loans if a large number of loss-making enterprises, banks will face a lot of financial risk, the loan can not be returned. the payment of deposits on the face of crisis. contain the risk of mortgage payments the bank's high-profit, there is a difference between banks and the general nature of the profits of producers, the banks that are insolvent, need to take the capital and profits to make up for the loss of depositors When the rapid expansion of corporate loss this financial risks banks can not afford.

Once again, the financial difficulties of finance is the speed type of financial growth in fiscal revenue and the growth of the GDP, is closely related to China to indirect taxes, revenue growth is mainly dependent on the nominal proportion of low income and on capital imposed direct taxes. GDP growth rate in recent years, data that the GDP growth rate of 1% change in fiscal revenue growth rate of change of 4.6% GDP growth rate of 4 percentage points change, fiscal revenue growth is likely to change by nearly 20 percentage points. therefore when excessive decline in the rate of economic growth, the growth rate of fiscal revenue dropped However, the economic downturn, the financial expenditure rigidity often relatively large because of the laid-off workers from poor families and low-income populations rescue will increase to protect the basic livelihood of the expenses will increase. therefore, the contradiction between fiscal revenue and expenditure will suddenly intensified when excessive decline in growth, employment, financial risk, financial income is very large.

3. Positive contribution to the "package" plan to keep the people's livelihood and economic stability

Launched the "package" plan is not to overreact. "Package" plan, in 2009 there will be depth adjustment may not be beneficial to the transformation and upgrading of view to the formation of the Forced mechanism, only the crisis in order to promote the upgrade, eliminate The low level of enterprise, but when most businesses are unable to protect themselves, difficult to maintain normal operations, engage in technological upgrading, it is impossible to enhance innovation capability so, the crisis is not necessarily conducive to transformation.

The effect of the "package" plan significantly accelerate the speed of growth of domestic demand, the contribution of domestic demand to GDP growth improved significantly in 2008, the contribution of domestic demand to GDP growth by 9.1 percentage points, to 12.8 percent in 2009, therefore, the most important performance , for 2009 need to pull down 3.6 percent, but GDP growth still reached 9.2% of domestic demand growth accelerated first by investment, especially government investment .2009 government investment, an increase of 42.2% over the previous year, accounting for 28% of the total investment from a statistical point of view, there are three parts: investment in electricity and heat, road transport, storage, post and telecommunications investment, water conservancy investment management and urban public facilities, municipal investment belongs to the third part of .2009, the total fixed asset investment an increase of 30.1% over the previous year, remove price factors, the actual growth of the investment is more than the previous year by more than 10 percentage points, so that domestic demand and a substantial increase in the contribution to economic growth. course, there are some other measures, such as the tax incentives business investment, consumer value-added tax reform is implemented from January 1, 2009, the focus of reform shifted from production to the consumer, the most important change is the investment in equipment modification can deduct the tax base, This is actually a very important tax cuts, but also encourages enterprises to invest in the equipment, and also have an active role in promoting the growth of investment in demand for cars, car purchase tax of 1.6 liters and less than 1.6 liters from 11 adjusted to 5.5%, to stimulate the consumption of the car, second-hand housing transactions in the property market, the relief deed ... through tax cuts to promote business investment profitable, and promote the growth of household consumption, stimulate domestic demand.

Significantly increase the contribution of domestic demand to offset the sharp decline of external demand to ease the strong impact of the international financial crisis, China's economy has maintained steady and rapid growth trend In 2009, China's economic growth rate of only 0.4 lower than in 2008 percent, down from 9.6% to 9.2% in the other hand, the United States and the European Union, GDP growth rate of -3.1% and -4.4%, respectively, the unemployment rate reached more than 9%, compared to a normal year doubled but domestic residents view , production and life are not obviously feel that the occurrence

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