China’s economy had another rip-roaring year, growing 11.4 percent for the year average. (More details here.) Experts on China had been saying that their long-run sustainable growth rate was about nine percent. You have to take all of their numbers with a grain of salt; maybe GDP growth was over 11 percent, or maybe it was actually 9. We don’t know for sure, but we do know it was strong and higher than a non-inflationary growth rate. We know this last point because inflation is surging.
That’s the strong, now here’s the weird, courtesy of the Financial Times:
Under the new measures, retailers of food products such as milk,
pork and eggs will need to seek permission from local price bureaux,
institutions that have long ago ceased to have any effective controls
over produce markets.
Economists who say the measures will not
work point to an announcement last year freezing prices for
government-controlled commodities such as oil and natural gas.
Only
weeks after this announcement, the government was forced to allow an
increase in petrol prices to defray fuel shortages caused by escalating
global oil prices.
That is followed by this worthy line (which may have been given to them by Richard Nixon):
“Our pricing law clearly states that the government wants to have a market-based pricing system.”
(Hat tip to China Law Blog for the FT article.)