Rise of the 1630s South America

Chapter 473 Economic Work ([-])

Monday, May 1645, 5, Port Orient.In the office of the Economic Countermeasures Committee of the Government Affairs Council, Qiang Quansheng, who is also the director of the State Administration of Precious Metals, is immersed in writing documents.As one of the major players in the domestic currency and economy, Qiang Quansheng is still full of enthusiasm for the current domestic economic construction.

It is now 1645, and nearly 15 years have passed since the first time when there were only two or three kittens.In the past 15 years, the country established by the crossing crowd has grown from scratch to the prosperous situation it is today.Every time I think of this, Qiang Quansheng is filled with emotion, and then he is full of passion for his career.

With the development of the country's economy and the increase of the population, various economic activities are becoming more and more active.In the last year alone, the Ministry of Industry and Commerce approved more than 50 individual or enterprise business licenses in one go, which fully demonstrates the current situation that the domestic commodity economy is becoming more and more developed.However, in the process of national economic development, some disharmonious status quo has also emerged.

At the beginning of last year, the state gradually liberalized price controls and monopoly operations in some non-key industries, and some private capital poured in, which led to a considerable increase in prices.Taking beef as an example, the largest source of fresh beef in China is the import of La Plata beef through the Colonia Free Trade Market.Since the last beef cattle supply agreement with the La Plata people expired on December 1643, 12, because the La Plata people requested a 31% price increase, the negotiations between the two parties broke down and they failed to renew the contract.Coupled with the national financial strain caused by the decline in foreign trade income, the Government Administration Council simply canceled the monopoly on beef, and instead responded to the call for market-oriented reforms proposed by some domestic liberals, allowing private capital to enter this industry, and at the same time criticizing beef in one go. Several business licenses have been issued.Among them, there are business licenses for slaughterhouses and business licenses for import and export trade enterprises.

After the establishment of these enterprises, they immediately organized a group to negotiate with the La Plata people and accepted their price increase conditions, that is, the CIF price of each beef cattle was tentatively set at 15 yuan.Unsurprisingly, such prices have caused a surge in the domestic beef market. Coupled with the profit-seeking nature of private capital, they demand higher profit margins than state-owned enterprises. Therefore, the price of beef in one town and five townships in the capital area has directly doubled. times.Except for a small amount of cheap beef from state-run ranches slaughtered by the state-run meat joint factory, the prices of other imported La Plata beef, South African yellow beef, and Xinhua Hump beef have all skyrocketed, making the entire market dumbfounded for a while.

Although they understand that the low-priced beef market in the past is abnormal and unsustainable, it is the result of the country's long-term disguised financial subsidies, but ordinary people don't think about these issues, they just curse those who raise the price Retailers and even wholesalers who are aloof.And these people are also very depressed, the price of imports has directly increased by half, and the private import and export companies, slaughterhouses, and wholesale/retailers they handle cannot make no money or only make a little money like state-owned stores. If you can't satisfy them, why bother to invest money in this industry?After finally breaking the monopoly operation, everyone must get some benefits. It is not so surprising that the price has doubled.

Coincidentally, the prices of other commodities such as imported fish and shrimp, cane sugar, and fruit have also experienced skyrocketing.These skyrocketing prices have undoubtedly caused serious inflation in the country. Coupled with the continuous rapid development of the national economy for many years, the wealth of the people has continued to increase, and the total amount of currency in the entire country has also continued to increase, just like what happened in the new The same thing happened in the Chinese colonies, the whole society was submerged in inflation.Although the degree of these inflations is much lighter than that of those European countries, it still caused great dissatisfaction among the common people. Social conflicts generally increased, and the assimilation effect generally decreased. Some of them were covered up due to the rapid economic development. Social problems are also gradually emerging.

Faced with this situation, the Government Affairs Council also held several meetings to discuss countermeasures.At the meeting, someone asked the government to restore financial subsidies, so that the price can be reduced.However, the argument that this is obviously the spokesperson of vested interests was quickly refuted by some cadres with military background. burden.At the beginning, it was these people who tried their best to encourage the government to open up the market, but the military representatives strongly opposed it. Now that domestic inflation has risen, these people have started to encourage the government to restore subsidies. Then do you want to take back the money that has been distributed to you? Business license, everything back to the old way?The two sides launched a fierce confrontation for this, but in the Government Administration Council, the stronghold of the civilian faction, the military or forces sympathizing with the military cannot gain the upper hand, so their proposal to bring these industries back to the government has not been passed.

However, redistribution of subsidies is not financially allowed.Let's take beef again as an example. Today, the nationals and slaves (South African laborers) of this country with a "long" tradition of eating beef need to consume about 40-50 adult beef cattle every day, which is about 8 to 10,000 a year. .If you want to return to the previous price, you need to subsidize about [-] yuan per head of cattle.This is a huge financial subsidy of [-]+ yuan. Judging from the current government's heavy foreign debts, the gradual deterioration of the foreign trade situation, and the need to import a large number of female slaves, the government will definitely not be able to spend this money to implement the subsidy.Thus, the debate turned into a meaningless war of words in the end, as neither side could come up with a practical solution to the problem.

"The issue of the actual purchasing power of currency is very important, because it involves the prestige of the government and many other aspects. This is especially important in our immigrant country. For this reason, on behalf of the Economic Countermeasures Committee, I solemnly propose to the Government Council to compile a price index table. In order to fully display the average price changes of various domestic commodities, this will play an important role in the formulation of economic policies by the Government Council, because it will reflect a series of situations including the purchasing power of currency, the increase in commodity prices, and even changes in the amount of domestic currency.” Qiang Quansheng wrote at his desk that the prices of several industries that have already risen in price will be difficult to stabilize in a short period of time when the government refuses to implement financial subsidies.If we rely solely on the adjustment of the market, it will take a long time to do so under the circumstances that the vast majority of beef cattle need to be imported, at least it will not be possible until the family breeding industry in the northern Pasture Ridge area develops greatly.

But before that, the Government Affairs Council really needs to compile a price index change table that includes many commodities that are easy to count in the country. This will allow the Government Affairs Council to grasp the country's economic trend more calmly and intuitively.

"We can use the price of this year (1645) as the base year, set the price of the package of commodities to be investigated as 100, and then convert the prices of the following years into a percentage of the base year price. This is the arithmetic index table. Of course, we can also make it more detailed, such as compiling the price index table on a monthly basis, so that the seasonal changes in the price of a package of commodities will also be seen at a glance."

"Of course, the importance of various commodities to the people is not the same. For example, even if the price of a pair of whale leather boots quadruples, it will hurt the people far less than a 20% increase in the price of a bag of South African sorghum. Therefore , we must admit that all kinds of commodities in the index table do not have the same importance. When compiling the price index table, we also need to multiply the price of each commodity by the weight, that is, to make a 'weighted arithmetic index table', the price Changes in the index often have practical reference significance."

"When making price statistics, we can not only extract customs import data, but also go to the wholesale market to make price statistics, or we can also draw data from some representative retail stores, that is, we must try to obtain the most original first-hand, Real data. Generally speaking, the price of daily necessities should have the largest weight, followed by general consumer goods that ordinary people occasionally buy, and finally luxury goods.”

"The necessities of life should include food (sorghum, potatoes, beef, mutton, pork, vegetables, cooking oil, fish and shrimp, flour, rice, sweet potatoes, corn, sugar, cream, cheese, eggs, etc.), cloth (cotton cloth, woolen cloth, linen, shoes, etc.) hats, belts), rent (this item is omitted), transportation expenses (trains, carriages, and boats), fuel (briquette, charcoal, peat), lighting (lights, candles), etc.; general consumer goods include soap, brushes, tools, fodder , newspapers and books, yerba mate tea, metal utensils, etc.; luxury goods include porcelain, tea, wine, high-end leather goods and other commodities, and the specific prices of more than 100 kinds and the weight of the price index they occupy are in the attached table.”

"We have to say in fairness that the main expenditure of the people today is still on food, and this ratio is about two-thirds to three-quarters. Of course, this only refers to workers. The situation of farmers will be better, because they They can often consume the food produced by themselves, which will save a lot of expenses. But correspondingly, the amount and channels of cash they obtain are far from those of workers. In fact, the food part of the price index table It is still written in a rough way. The real situation should be that food is also graded, that is, the main food that is most important to ordinary citizens (flour, oil, etc.), and some secondary foods that are not often consumed (meat, sugar, Eggs, butter, etc.), their respective weights should not be the same. All in all, in this environment where food expenditure occupies the mainstream of a person's expenditure, the government should be more sensitive to price changes of these commodities, and this is also the price index change table meaning."

(End of this chapter)