While inflation dominated the news about last week’s National People’s Congress, a more interesting story may be the contentious internal debate about rebalancing Chinese growth from investment to consumption. It will prove a difficult task. The evolution of Chinese household consumption is one of the more striking economic stories of recent decades. In the 1980s household consumption comprised 50-52 per cent of China’s GDP – low, but within range of other high-saving Asian countries.

　　在有关上周中国人大会议的新闻报道中，通胀是焦点所在，但是，一场围绕中国经济再平衡的内部激辩或许会让人们更感兴趣。从“投资型增长”转变为“消费型增长”将是一项艰巨的任务。中国家庭消费的演变是近几十年最令人瞩目的经济事件之一。上世纪80年代，家庭消费在中国GDP中占的比重为50-52%，属于低水平，但尚在亚洲其他高储蓄国家所处的范畴之内。

　　Over the next decade as China’s economic growth outpaced consumption, household consumption declined slowly as a share of gross domestic product, to reach a worrying 46 per cent in 2000. Such a low share left rising investment and trade surpluses as the main engines of Chinese growth. Both rose rapidly during the next decade, generating growth of over 10 per cent annually.

　　在之后的十年内，由于中国经济增速快于消费增速，家庭消费在GDP中的占比缓慢下降，到2000年降至令人担忧的46%。不断扩大的投资和贸易顺差由此成为拉动中国经济增长的主要引擎。在接下来的十年内，这两个环节迅速扩张，推动中国经济年均增长10%以上。

　　In the next decade, however, thanks to the urgent need to repair China’s bankrupt banks, the divergence accelerated, and by 2005 consumption dropped to an unprecedented 40 per cent of GDP. Under Premier Wen Jiabao’s leadership Beijing resolved to rebalance the economy and increase the share of household consumption. But the low consumption share wasn’t an accident. It is fundamental to the growth model and cannot be reversed without abandoning the model. Not surprisingly, Beijing was unwilling to do so, and household consumption declined further over the rest of the decade to an astonishing 35 per cent of GDP.

　　然而，在接下来的十年内，由于处于破产境地的中国各家银行亟需救助，消费与投资和出口以更快的速度背道而驰。到2005年，消费的占比降至40%这一前所未有的最低水平。在温家宝总理领导下，中国政府决心推动经济均衡增长，提高家庭消费在经济中的比重。但是，低消费并非偶然现象，而是现有增长模式的根本特征。不放弃现有模式，就无法改变低消费。果不其然，中国政府不愿意这么做。于是，接下来的5年里，家庭消费比重进一步下滑到35%，令人愕然。

　　China’s breakneck economic growth was fuelled by vast transfers of household wealth, which subsidised the manufacturing and investment boom and paid for bad loans. The most important of these transfers is the very low interest rate set by the central bank, which takes at least 5-7 per cent of GDP every year from households to give to banks and borrowers. Lower household wealth, of course, means lower household consumption.

　　中国经济的极速增长受到了大规模家庭财富转移的推动。家庭财富的转移为制造业和投资的繁荣提供了补贴，并为不良贷款埋单。其中最重要的因素是央行制定的极低利率。在低利率的作用下，每年从家庭转移给银行和贷款者的财富起码占GDP的5-7%。家庭财富减少，自然导致家庭消费下降。

　　China’s investment-driven growth model is not unique. Many countries have used a version of this successful strategy, but all run into the same constraint. Rapidly expanding, politically directed investment tends to be misallocated. The losses are disguised, but not eliminated, by the huge hidden interest-rate subsidies.

　　投资驱动型的增长模式并非中国所独有。许多国家都有过成功的先例，但也都遇到了同样的困境。迅速扩张、受政府指导的投资往往存在配置不当的问题。所造成的损失会被巨额隐性利率补贴掩盖起来，但不会因此消失。

　　China is no exception. It is misallocating capital on an unsustainable scale. So now Beijing must allow households to increase their share of the vast wealth generated in recent decades so that consumption, and not more investment, can be the next great driver of growth. But here’s the catch. Rebalancing requires that China reduce investment growth. The more bad investment China piles up, the more it must transfer wealth from households to keep those investments viable. But lower investment will cause a dramatic drop in economic growth. Accelerating investment is the only way policymakers can maintain high growth rates.

　　中国也不例外。中国资本错配的规模之大已到了难以维系的地步。因此，现在中国政府必须允许家庭从近几十年产生的巨额财富中获得更大份额，使消费取代投资，成为未来经济增长的主要推动力。但这中间暗藏隐患。再平衡要求中国降低投资增速。不良投资累积越多，就必须从家庭转移出越多财富，来维持那些投资。然而，投资减少势必导致经济增长骤然放缓。加快投资步伐是政策制定者维持经济高增长的唯一途径。

　　This is why the debate within China has become so contentious. Reformers argue that the transition to a more sustainable growth model requires reduced investment – and slower GDP growth. Their opponents, who are concentrated in sectors of the economy that benefited from the growth model, do not see the link between rapid growth and low consumption. They argue for administrative steps to improve consumption without decelerating investment.

　　这就是中国国内这场争论变得如此激烈的原因所在。改革派认为，要形成一种更可持续的增长模式，就必须减少投资，放慢经济增长步伐。反对者——主要集中在受益于现有增长模式的行业——则认为高增长和低消费之间不存在关联。他们主张采取行政手段，在不导致投资减速的前提下扩大消费。

　　How quickly China resolves this debate is crucial. The historical precedents make it clear that once domestic imbalances are severe, the longer a country waits to adjust away from investment-driven growth, the more costly it is. But precedent also makes it clear how addictive the model can be. This is the challenge for China’s leadership. As long as investment grows quickly, it will require more subsidies from the household sector, and the household consumption share of GDP will stagnate. It is not until China makes the transition to a new growth model that rebalancing will begin.

　　中国何时能够解决这场争论至关重要。历史先例表明，一旦国内失衡达到严重程度，在改变投资驱动型增长模式方面拖延的时间越长，为此付出的代价就越大。但是，历史先例也让我们知道了，这种模式会让人多么上瘾。这正是中国领导层面临的挑战。只要投资还在迅速增长，就需要家庭部门提供更多补贴，家庭消费占GDP的比重就将停滞不前。只有在中国开始朝着新增长模式转变以后，再平衡才会启动。

　　The heated debate between the reformers, who are as unpopular as anyone who brings bad news tends to be, and those who see no reason to abandon a model that has generated such spectacular growth, has become one of the debates in the world. How quickly it is resolved will determine the pace and nature of China’s economic growth over the next several decades.

　　改革派（他们就像传递坏消息的信使一样惹人讨厌）和维护现有模式的阵营（他们认为没必要放弃一种带来如此高速增长的模式）之间的激烈辩论，已经成为一场世界级辩论。这场辩论何时落下帷幕，将决定未来几十年中国经济增长的速度和性质。

　　The writer is a finance professor at Peking University and a senior associate at the Carnegie Endowment .

　　本文作者系北京大学金融学教授、卡内基基金会(Carnegie Endowment)高级研究员。