Cut the cake fairly

Vice-Premier Li Keqiang's speech on reform invited wide attention from home and abroad. He talked frankly about some difficult problems in reform today and proposed new thoughts on income distribution.

He said reform will necessarily affect the nation's income structure. More importantly, he said most jobs should be based on incremental income, and income expectations should be adjusted. Meanwhile, the stock interests' structures should be optimized. It will be easier to reach a consensus of reform and reduce the resistance to reform.

The reform path Li proposed on income distribution should be a proposal acceptable to most people. The most pressing challenge now is how to “cut the new cake” fairly.

China can no longer carry out the “Pareto efficiency” reform that does not affect all people's incomes. The stagnancy of current reform largely originates from the solidification of income structure and the opposition of interest groups. Adjusting income expectations is the prerequisite condition to prepare the interest groups for the forthcoming reforms in income redistribution.

China is used to solving problems through development. But making the cake bigger does not necessarily solve the problems occurring in this process.

The decision-makers should show more wisdom and courage to force different interest groups to compromise in reform. This process should have been carried out according to a clearly made plan.

The people who got a large piece of the cake should be aware their privilege is not sustainable. Or they may lose the pieces of cake they have already received. So they have to compromise in the future when the cake is cut and distributed again.

This reform should be done step by step. The public should lower its expectation of “a perfect reform”.

The authority now needs to make much fairer rules on cutting the cake and make those rules acceptable to all. However, as long as reform is on the right track to fairness and justice and the government adheres to rule by law, it may not be that difficult to cut the cake.

Translated from Beijing News Daily By Li Yang