China does not depend on global trade or global finance. Any difference in the influx or outflow of money supply can be corrected by the People's Bank of China. Just like the Federal Reserve can prop up the stock market using quantitative easing, the People's Bank of China can prop up wages and employment growth through quantitative easing. All they need to do is make a head count of the number of people that need to be employed. And make an estimate of how much money needs to enter the money supply and distributed correctly to get 10 or 20 percent wage growth. And when these calculations are done, quantitative easing will create the money necessary to hit those marks.
The money is not coming from taxation. Otherwise there would be no real monetary wealth creation. Any additional Yuan one laborer receives comes at the expense of another laborer who loses one Yuan from taxation. So the money is always newly created, not from taxation and redistribution.
No comments:
Post a Comment