How is China's government spending taxpayer money?
This is not an easy question to answer. The most populous country in the world ranks among the worst in matters of government transparency.
The Chinese government budget, presented to the public each March as a fait accompli, contains only scattered information about spending priorities and no details about specific programs. It is notoriously difficult to find specific budget information for individual government ministries, and no long-run spending forecasts are provided. Revenue Watch Institute, a group that campaigns for open government, describes China's budget as "exceedingly opaque" with "scant or no information" that citizens could use to hold their leaders to account.
Still, China's 13.3 trillion yuan budget is not a complete black box. It does provide some broad spending categories, with education, social security and transportation all ranking in the top 10 funding areas.
The largest category shown above -- labeled "other" -- contains smaller items, including interest payments on debt, commodity reserves, foreign affairs and public housing. The decentralized nature of government in China muddles the picture, with a majority of spending administered by provincial and local governments.
The overall lack of detail has not gone unnoticed in China, where transparency advocates have pressed for a more open budget process. The government is now promising reform, but details remain vague, leaving analysts to examine broader spending trends.
One trend is easy to identify: China is spending more and more, although the pace of growth has slowed in recent years. China still falls well behind the United States in overall spending -- at $2.2 trillion compared to around $3.5 trillion for Washington. And the U.S. runs a much larger budget deficit.
China's estimated deficit for 2013 is 1.2 trillion yuan, or $198 billion at current exchange rates. That's equal to 2% of GDP. Although significantly higher than previous years, China's deficit is under control. In fact, some observers say Beijing should have cut taxes further last year in an effort to boost domestic demand. By way of comparison, the U.S. ran a $680 billion deficit in fiscal year 2013, or 4.1% of GDP, down from a high of $1.4 trillion in 2009.
It now seems very likely that China's economy will meet or exceed Beijing's 7.5% growth target for 2013. For President Xi Jinping, still in his first year of office, this is very good news.
At the same time, heading into a pivotal meeting of the Communist Party, the country's policy landscape is unusually unsettled. Clarity on three key items -- local debt, economic reform plans and the Shanghai Free Trade Zone -- would MORECharles Riley - Oct 29, 2013 10:48 PM ET
When the current crop of Chinese leaders assumed power, they wasted no time in ordering an extensive audit of local government debt.
Presumably the new team, led by President Xi Jinping, wanted to know what everyone else wants to know: How has China's massive expansion of credit since 2008 affected state finances?
The uncomfortable truth is that nobody has a great handle on exactly how much local governments have spent.
The bean counters MORECharles Riley - Sep 18, 2013 5:32 AM ET
Most readers are probably familiar with a game called "pin the tail on the donkey" -- a staple of birthday parties for children under the age of 10.
For the uninitiated, the game involves a blindfold, a disorienting series of spins and an attempt to pin "the tail" on a paper "donkey." Nobody ever seems to get the pin in quite the right spot. But it can be quite entertaining to see the MORECharles Riley - Jul 12, 2013 5:04 AM ET
A big chunk of Iraq's oil production is going to China, according to a story Monday in the New York Times. That may be a good thing for both U.S. companies and consumers.
The Times reported on what has been an ongoing trend -- companies from China and elsewhere winning Iraqi oil contracts. According to the story, nearly half of Iraq's oil now goes to China.
The article played up the seeming MORESteve Hargreaves - Jun 3, 2013 1:46 PM ET
Are China's economic statistics accurate?
Pose this question to a group a China watchers and you're likely to receive a variety of responses. Some observers are convinced that China is cooking its books. Others believe state statistics are largely reliable and useful for drawing conclusions about the world's second largest economy. Still others will debate the accuracy of certain data classes, pointing to more meaningful alternatives.
Now we have an opinion from researchers MORECharles Riley - Mar 26, 2013 6:57 AM ET
Premier Wen Jiabao opened China's annual parliamentary meetings Tuesday by issuing a new set of targets for the world's second largest economy.
The target for gross domestic product growth will remain 7.5%, but the government said it will carry a larger deficit in 2013 to help finance spending plans.
China recorded its weakest growth in 13 years in 2012, but a rebound in the fourth quarter removed any lingering concern that its MORECharles Riley - Mar 4, 2013 11:01 PM ET
The National Intelligence Council -- the same thinkers who produce National Intelligence Estimates -- has released an 140-page report that offers a series of prognostications about how the world might change in coming decades.
The report is full of all kinds of fun concepts, like powered exoskeletons designed to help the elderly, bio-based energy and 3-D printing. You can read the full report here.
But one of the biggest economics themes of the report is the MORECharles Riley - Dec 10, 2012 10:46 PM ET
The United States may be hurtling towards a fiscal cliff at the end of the year. But if the U.S. is Thelma then China is Louise. Despite continued fears about another debt ceiling debacle at the end of this year, China is buying U.S. Treasury debt like it's going out of style ... or like it's Facebook stock.
The Treasury Department released its latest figures on foreign holdings of U.S. debt MOREPaul R. La Monica - May 15, 2012 2:57 PM ET
China's booming economy is giving to the poor and taking from the rich when it comes to housing.
Some 14% of both the rich and the poor said they had trouble affording shelter in 2011, according to a recent Gallup survey. That's a dramatic change for each group in recent years, but the shifts were in opposite directions.
For the poor, 14% is half the percentage of people who didn't have enough MORETami Luhby - Mar 27, 2012 2:32 PM ET
U.S. exports to China topped $100 billion for the first time in 2011, the latest in a series of rapid expansions, according to a new report from the US-China Business Council.
That means China -- the world's second largest economy -- trails only Canada and Mexico as a buyer of American goods. Exports hit $103.9 billion in 2011, an increase of $12 billion over the previous year.
The recent growth will go MORECharles Riley - Mar 27, 2012 11:04 AM ET
China still owns a LOT of U.S. Treasury debt. But it looks like they got rid of more of it last year after Standard & Poor's stripped America of its triple-A credit rating than first thought.
Every month, the Treasury Department puts out a report showing how much foreign countries hold in U.S. securities. The latest report came out in mid-February and showed that as of the end of December, China MOREPaul R. La Monica - Mar 1, 2012 4:40 PM ET
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||4.09%||4.03%|
|15 yr fixed||3.25%||3.18%|
|30 yr refi||4.12%||4.07%|
|15 yr refi||3.29%||3.19%|
Today's featured rates:
|Latest Report||Next Update|
|Home prices||Aug 28|
|Consumer confidence||Aug 28|
|Manufacturing (ISM)||Sept 4|
|Inflation (CPI)||Sept 14|
|Retail sales||Sept 14|