China hopes social safety net will push its citizens to consume more, save less
And China's main reason for adding economic safety net of unemployment, medical care and retirement, it will spur economic growth.
Aside from the individual benefits, there is a larger economic imperative to the new social programs. The country's leaders want to persuade Chinese citizens to spend more and save less, a goal that analysts say could be achieved if the government provided a safety net.
China is adding jobs, 7% GDP growth rate, but it recognizes the economic benefit of an economic safety net for its citizens.
Meanwhile the once more ascendant right wing in the US is cutting US economic safety. Pensions are eliminated or simply vanish in mergers or stock frauds. Unemployment during the worst recession in 100 years is cut. Medical care costs skyrocketing out of reach of businesses and individuals. All the things the Chinese recognize as bad for the economy.
It is clear that US needs more economic stimulus from the government. Unemployment checks for another year for the 14 million unemployed is a huge economic boost. Covering state deficits so teachers, fireman, maintenance workers, social workers, engineers can keep state and cities functioning provides a huge economic boost in the services delivered and the paychecks that flow to so many other jobs from home repair to clothing to recreation to health care.
Nothing signifies the US economic decline more than a Presidential commission that promotes cutting Social Security on top of recent $500B cuts to Medicare. As China notes, no organized economic safety net of unemployment, medical care and retirement pension causes economic contraction.
The lack of leadership begins at the top. Obama is pushing cuts in the economic safety net and downplaying stimulus and unemployment. I'd bet on China's route vs. Obama's.