You are required to read and analyze a recent article from the Wall Street Journal, each covering a different topic addressed in the course. You will then write a 1-page review of each article. Accessadmin / August 17, 2018
World China Says Will Spend More Than Meets the Eye; Beijing will take back unspent money given to local governments and then spend it lingling wei…
You are required to read and analyze a recent article from the Wall Street Journal, each covering a different topic addressed in the course. You will then write a 1-page review of each article. Access the Wall Street Journal through a personal subscription. Each unit will have a different list of topics to choose from. Module/Week 5 Topic Choices: Federal budget deficitsMandatory government spendingEffects of the federal debt on the economyLaffer curveCrowding outAutomatic stabilizersExpansionary fiscal policy Make sure to select articles (300 words or more) that address all of the needed information below. Short articles will often not provide you with enough detail to write about. In addition, purely statistical releases of data are not wise selections either. Articles must be no older than 2011. For each article, do the following: On the top of the page, provide the article citation in current APA format. On the next line down, type the topic of your articles (from the list above) in all caps and bold format. In a double-spaced document, briefly explain the author’s purpose for writing the article. One way to understand the author’s purpose is to ask yourself why he or she wrote it. (For example, consider current and future events, politics, or anything else that may have inspired the article.) Summarize the article, focusing on the discussion of the topic the article addresses. Incorporate relevant economic theory that is present so that discussion of the article content is clear.
China Says Will Spend More Than Meets the Eye; Beijing will take back
unspent money given to local governments and then spend it
By Lingling Wei
6 March 2015
The Wall Street Journal Online
Copyright 2015 Dow Jones & Company, Inc. All Rights Reserved.
BEIJING—The Chinese government won’t be as tightfisted this year as official
projects suggest, China’s finance minister said on Friday, indicating the
authorities will beef up spending to spur economic activity.
A budget report delivered to the country’s legislature on Thursday showed that
Beijing projects only a slight increase in its fiscal deficit, to 2.3% this year from
2.1% in 2014. That has led some economists and analysts to question the
leadership’s commitment to use what it has called an expansionary fiscal policy
to cushion the slowdown.
At a news conference on Friday, Finance Minister
sought to dispel the
doubt. He said the real fiscal deficit will come considerably higher than the stated
Mr. Lou cited a new budget law that took effect in January that allows the central
government to take back unspent money it has given to various local
governments in the past years and then spend it. Those funds aren’t included in
Beijing’s spending for this year because they were previously allocated to local
governments, even though the money hasn’t been spent.
Taking into account those funds, as well as new government borrowings to repay
old debt, Mr. Lou said China will incur a fiscal shortfall of 2.7% of the nation’s
gross domestic product.
“Fiscal policy will have to be expansionary” given the downward pressure on
China’s economy, Mr. Lou said, while adding greater government spending would
play “a relatively big role in counteracting the pressure.”
China is battling a host of economic ills, ranging from a slumping property market
and persistent industrial overcapacity to rising debt levels. Recognizing the
growing headwinds, the Chinese leadership lowered its annual growth target to
7% for 2015, the lowest level in 24 years. Meanwhile, it has also pledged to use
a more proactive fiscal policy to stabilize growth while keeping monetary policy
View the Answer
“prudent,” out of concern that too much credit would further worsen China’s debt
However, Beijing also is facing a fiscal challenge as falling land sales and a
struggling manufacturing sector hurt tax revenue at various levels of government.
Total fiscal revenue grew 8.2% to 14 trillion yuan ($2.3 trillion) last year, the
slowest pace in more than two decades.
“The government faces huge pressure on its tax revenue,” Mr. Lou said, while
projecting a “single-digit” growth rate in fiscal incomes in many years ahead.
In response, the Finance Ministry has adopted some measures to beef up the
state’s coffers. For instance, it raised fuel-consumption taxes three times last
year just as global oil prices plunged. Those tax increases didn’t amount to a big
burden on businesses and consumers because of the price drop, even as they
increased the government’s revenue, Mr. Lou said.
At Friday’s news conference, Mr. Lou also said the Finance Ministry will press
ahead on reining in rampant local-government borrowings — which, according to
International Monetary Fund
, is responsible for one-fourth of the buildup in China’s
overall domestic debt since 2008.
Part of Mr. Lou’s strategy involves banning thousands of financing firms set up by
local governments from additional borrowing. Instead, local governments would
be allowed to borrow directly each year a certain amount of funds set by the
country’s budget plan.
But some economists are skeptical about the government’s ability to push
through the reform as it may squeeze local officials’ ability to increase spending.
“While policy makers are focused on improving the long-run sustainability of local
government finance, they will not push ahead if the cost is a slump in near-term
growth,” said economist Mark Williams at Capital Economics.
Show entire documentBeing in the business for a long time meeting the requirements of students from all over the world has helped us become the best essay writing services provider. Unlike other cheap custom essays services, we never compromise the quality of the service though we provide affordable and cheap custom essays without missing the deadlines provided by the students. One of the most commented factors of our term paper writing services is our ability to provide best dissertation writing services that match the academic requirements and status of the student. This has helped us provide most realistic writing services to our UK , USA, Canada, Asia, Europe, and Africa students making them very likely to get highest grades in their tests and examinations. Certainly we can say that it our conscious efforts to provide our students with research paper writing services that are well beyond the mediocre services that many so called essay writing services offer to them. We have always believed in helping students achieve their dreams and we have ever since toiled hard to make sure that each of our client is able to achieve their career goals with the support of our essays and theses.