Low-income urban residents are currently suffering from the
soaring price of food. A survey shows that city-dwellers have been
influenced by the prices of commodities, and experts believe the
government should bear more public responsibility.
Many of those interviewed in Shanghai say that they are living a
frugal life and economizing on food, and worried about additional
inflation. Moreover, "the speed of increasing wages has lagged far
behind the speed of rising prices," a citizen said.
Quan Heng, a researcher at the Institute of Economics of the
Shanghai Academy of Social Sciences, points out that the public is
particularly sensitive to the price fluctuation because these are
items they use every day, not dispensable things.
"A price-hike is not simply equal to inflation," Quan Heng said.
"Inflation's strict definition in economics is the successively
sharp increase of overall prices. Various reasons will lead to
inflation, usually demand-driven, cost-propelled or these two
factors collectively causing the inflation."
From his point of view, increased demand is not the reason for
this price-hike, because the need for daily items such as meat,
eggs, and poultry remains fairly constant. Instead, he believes the
increasing price of agricultural products, the rising price of
animal feed in particular, is raising the price of food.
Liu Huangsong, another researcher at the institute, has a
different theory on the high prices. Liu believes the oversupply of
pigs last year, which led to a price drop, followed by a
substantial reduction in the amount of live pigs this year left the
supply unable to meet the demand; furthermore, the rising price of
petroleum has increased the demand for biological alternative
energy.
"In fact, the increasing price of pork, which is the leading
agricultural product, is not only to raise the income of farmers,
but meet the economic laws of developmental requirements as well.
China's agricultural prices were low for a long time, and wages of
the urban population increased quickly while the income of farmers
increased relatively slowly. Therefore, the adjustment of
agricultural prices is reasonable," Liu said.
In view of the atypically rapid rise in prices, the National
Development and Reform Commission recently issued an urgent notice
to strictly control the government policy concerning increases and
price intervention measures. Under normal circumstances, the market
should regulate prices without the government stepping
in.?
Gu Jun, professor of Sociology at Shanghai University, holds
that requesting for the government not to interfere with the market
unduly does not mean that the government should have no conduct and
actions.
A rapid and sharp increase in prices will not only affect
low-income groups' daily lives, but also bring middle-income people
a sense of anxiety. "At this time, the government should take
public responsibility promptly," Gu Jun said.
(China.org.cn by Fan Cong, August 8, 2007)
