to firmly drive common prosperity

• 15-09-2020·16-11-202015-09-2020·16-11-202015-09-2020·16-11-202015-09-2020·16-11-2020·16-11-2020` (translation)

Xi’s speech at the 10th meeting of the Central Financial and Economic Affairs Commission (Aug 2021) introduced the concept of common prosperity.

• it's an overarching program that aims to promote socioeconomic equality while reinforcing party legitimacy and control.
• This is by far the most authoritative and detailed articulation of common prosperity we have up to this point, it tells us much about the direction in which Xi wants to take China.

intro

• We realised that poverty is not socialism; we broke the shackles of the traditional system; we allowed some people and regions to get rich first; and we promoted the liberation and development of socially productive forces.
• At present, income inequality is a prominent issue around the globe. The rich and the poor in some countries are polarised with the collapse of the middle class. This has led to social disintegration, political polarisation, and rampant populism -- indeed, the lessons [for us] are profound!
• Common prosperity is an essential requirement of socialism and an important feature of Chinese-style modernisation. The common prosperity we are talking about is the common prosperity of all people. It is the prosperity of all people in their material and spiritual [and moral] lives.
• By the end of the 14th Five-Year Plan [2021-2025], common prosperity for the entire population will have taken a solid step forward, and the gap between the income and actual consumption levels of residents will have been gradually reduced.
• By 2035, common prosperity for the entire population will have made more visible and substantial progress, and [access to] basic public services will have been equalised. By the middle of this century, common prosperity for the entire population will be basically achieved, and the gap between income and consumption levels of residents will have been narrowed to a reasonable range.

principles to follow

• Encourage industriousness and innovation as means to prosperity.
  • We must prevent social stratification, open up channels for upward mobility, create opportunities for more people to become rich, form a development environment with participation from everyone, and avoid [the phenomena of] "involution" and "lying flat".
• Adhere to the basic economic system.
  • we must maintain the public ownership system as the mainstay and simultaneously develop the economics of a variety of ownership systems. While giving full play to the important role of the public sector economy in driving common prosperity, we must also promote the healthy development of the non-public sector economy and the healthy growth of its members.
  • it should be emphasised that those who become rich first [shall] lead and assist those who are not yet rich.
• Do the best and act within competence.
  • The government cannot take care of everything. Its focus should be on strengthening the construction of people’s livelihood guarantees that are fundamental and universal.
• Adhere to a gradual and orderly process.
  • Some developed countries have been industrialising for hundreds of years, but due to their social systems, they have not solved the problem of common prosperity and, in fact, the problem of disparity between the rich and the poor has worsened. We need to be patient, and progress step-by-step in a firm and steady manner as to improve actual effectiveness.
  • The general idea is to adhere to the people-centred development ideology; promote common prosperity during the course of high-quality development; correctly handle the relationship between efficiency and fairness; build a foundational system for coordinating and supporting primary distribution, [secondary] redistribution, and tertiary [re]distribution; increase the level of adjustment and precision in taxation, social security, transfer payments, etc; expand the size of the middle-income groups as a proportion of the population; increase the income of low-income groups; reasonably adjust high incomes; and prohibit and suppress illegal incomes.
  • These measures aim at creating an olive-shaped [income] distribution structure with a large middle and [two] small ends.

areas of focus

• First, we must improve the balance, coordination and inclusiveness of development.
  • We must enhance the balance of development between different regions and implement the major regional development strategy [which includes Beijing-Tianjin-Hebei coordinated development, the development of the Yangtze River Economic Belt, the construction of the Guangdong-Hong Kong-Macao Greater Bay Area, and the economic integration of the Yangtze River Delta Region] along with the coordinated regional development strategy.
  • We should support the development of small and medium-sized enterprises and build an enterprise development ecology in which large, medium and small-sized enterprises are interdependent and mutually supporting.
• Second, we must focus efforts on expanding the size of the middle-income groups.
  • Graduates from higher education institutions are promising potential members of the middle-income groups. We must improve the quality of higher education, make sure [students] acquire specialisations and learn what is useful, and help them adapt to the needs of social development as soon as possible.
  • Owners of small and medium-sized enterprises and sole proprietors are an important group of people who have become rich through entrepreneurship. We must improve the business environment [for them], reduce their burden of taxes and fees, and provide them with more market-based financial services. This is to help them run their businesses in a stable manner and continue to increase their income.
  • Migrant workers [moving from rural] to urban areas are an important source for the middle-income groups. We must deepen the reform of the household registration system, and resolve issues such as agricultural labour transfer [both between agricultural sectors and out of agriculture to other sectors], accompanying migration [of migrant worker families], education for children of migrant workers, etc. This is so that migrant workers can enter the city with peace of mind and find stable employment.
• Third, we must promote the equalisation of basic public services.
  • We must improve the housing supply and support systems, and insist on the position that housing is for living in and not for [financial] speculation.
• Fourth, We must strengthen the regulation and adjustment of high incomes.
  • We must clean up and regulate unreasonable incomes, strengthen the management of income distribution in monopolistic sectors and with respect to state-owned enterprises, rectify the order of income distribution, and clean up the chaotic situations of distribution, such as increasing the income of executives in disguise in the name of reform.
  • We must protect property rights and intellectual property rights, and protect legitimate wealth creation. We must resolutely oppose the disorderly expansion of capital, draw up a negative list for market access for sensitive areas, and strengthen anti-monopoly regulation and supervision.
• Fifth, we must promote common prosperity in the spiritual [and moral] lives of the people.
  • We must strengthen the guidance of the Socialist Core Values, and education on patriotism, collectivism and socialism. We must develop [our] public culture enterprise, improve the public culture service system, and continuously meet the diverse, multi-levelled, and multi-faceted spiritual, moral and cultural needs of the people.
  • We must strengthen public opinion guidance on driving common prosperity to provide a favourable public opinion environment.
• Sixth, we must drive common prosperity among farmers and in rural areas.
  • The most difficult and onerous task of promoting common prosperity remains in the rural areas. The work of common prosperity in rural areas should be expedited.
  • We must comprehensively drive rural revitalisation, accelerate the industrialisation of agriculture, revitalise rural assets, increase farmers’ income from property, and enable more rural residents to become rich from hard work.
• If we want to achieve common prosperity for 1.4 billion people, we must have a firm footing on solid foundations and make unremitting efforts. Not all people will become rich at the same time, nor will all regions reach the same level of affluence at the same time. Not only will different groups of people achieve a higher or lower level of affluence, but there will also be differences in the timing. There will also be certain differences in the level of affluence between different regions; it is simply not possible for them to advance at the same speed.
• My overall perspective is that, like the building of a moderately prosperous society, the common prosperity of all people is a general concept. It should be applied to the whole society, and not applied in a way that divides urban and rural areas, or eastern, central and western regions, with each proposing its own indicators; we need to look at the whole picture.