China's Bizarre Stimulus: Subsidizing Gadgets to Boost Consumer Spending \ stacker news ~econ

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China's Bizarre Stimulus: Subsidizing Gadgets to Boost Consumer Spending

718 sats \ 23 comments \ @TomK 3 Jan econ

China has announced an expansion of its consumer product subsidy program to include smartphones, tablets, and smartwatches. This move aims to invigorate consumption within the world's second-largest economy, which has been grappling with sluggish consumer demand.

The National Development and Reform Commission (NDRC), China's top economic planning body, revealed that the existing government initiative—originally designed to encourage consumers to upgrade vehicles and household appliances—will now extend to include electronics and security devices. Specifics of this initiative are expected to be released imminently.

This policy twist underscores a peculiar reliance on Keynesian economics and central planning, often leading to what critics describe as bizarre economic experiments. By incentivizing the purchase of tech gadgets, China hopes to jump-start consumer spending, while this bizarr move will lead to further market distortions

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42 sats \ 1 reply \ @Skipper 3 Jan

a subsidy program to incentivize consumerism... absolute fiat clown world

10 sats \ 0 replies \ @Undisciplined 3 Jan

No kidding. That's about as impoverishing as a policy could be, without just outright destroying stuff.

35 sats \ 12 replies \ @Satosora 3 Jan

Another reason why people will have to stay on the hamster wheel. Are people going to learn that their money is becoming worthless? Soon, with their income, they wont be able to buy any electronics without some kind of subsidy.

20 sats \ 11 replies \ @Undisciplined 3 Jan

They're learning, but slowly.

22 sats \ 10 replies \ @Satosora 3 Jan

Didnt they just have a similar issue with construction and speculation?

20 sats \ 9 replies \ @Undisciplined 3 Jan

Probably, commie central planners are always playing whack-a-mole with the new problems they're generating.

26 sats \ 8 replies \ @Satosora 3 Jan

What happens when a government invests in their people? Are there any societies like that?

20 sats \ 7 replies \ @Undisciplined 3 Jan

No, because governments don't have their own resources to invest.

The closest to "investing in their own people" would be massive wealth transfers from one group to another. There are plenty of governments like that.

38 sats \ 6 replies \ @Satosora 3 Jan

I meant more along the lines of investing taxes and such into the people so that the nation grows as a whole. Norway, Sweden, and Finland come to mind, but not sure exactly if that is correct.

20 sats \ 5 replies \ @Undisciplined 3 Jan

All three are substantially poorer than America. There's tremendous loss in transfer systems. Not to mention that the politicized nature of the transfers ensures that prosperity will not be the primary aim.

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20 sats \ 7 replies \ @Undisciplined 3 Jan

I have two cynical hypotheses:

Those sectors were struggling and they lobbied behind the scenes for this form of bailout.
The CCP thinks this is an inexpensive way to distract a disgruntled populace with shiny things.

22 sats \ 6 replies \ @Satosora 3 Jan

Most people in China can barely afford the house they live in. How is this going to work in their favor?

20 sats \ 5 replies \ @Undisciplined 3 Jan

I don't know all the policy details, but I don't think the over-investment in construction was driven by direct subsidies. My recollection is that it was one of the less expensive ways for local party officials to appear to be meeting certain economic growth targets.

21 sats \ 4 replies \ @Satosora 3 Jan

I think the over investment was driven by greed and misdirection. They thought it would never stop.

20 sats \ 3 replies \ @Undisciplined 3 Jan

Greed's ever present, therefor it's not a good explanatory factor. Just like gravity being the cause of plane crashes is not a satisfactory explanation.

29 sats \ 2 replies \ @Satosora 3 Jan

If the people were happy with what they had, there wouldnt be so much greed over there. They always want more. I went to school with some Chinese students, and their priorities in life are different.

20 sats \ 1 reply \ @Undisciplined 3 Jan

When those students' parents were born, China was one of the poorest places on earth and was governed by one of the most evil regimes in human history. The norms that developed out of that and allowed the recovery that's taken place since are pretty understandable.

The current generation of Chinese young adults, in my experience, are much more relatable in their motivations and behaviors.

21 sats \ 0 replies \ @Satosora 3 Jan

It could have been the generation I was in school with. All they wanted were good grades, and to get an american bf/gf. They were willing to waste a lot of money to get those things, too. Maybe the newer generation is a bit more sound. And the amount of corruption in those families, most had 2 kids. Party members, guess it pays to be part of the group that is leading.

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