Stimulating China

| Fri Jan. 23, 2009 12:36 PM EST

STIMULATING CHINA....Ezra Klein explains why the Chinese government is setting up a universal healthcare plan:

The Chinese have a high savings rate — indeed, an absurdly high savings rate, between 30 percent and 40 percent of income — and one of the reasons is fear of medical expenses. China lacks a safety net, and so people spend less because they need to plan for catastrophe. And if catastrophe doesn't befall, then they've simply spent less. Which is a problem when you're facing down a potentially long recession. And so China is trying to make it safe for its citizens to spend, which means making future expenses more predictable, which means offering health care coverage.

That's certainly a unique reason for backing national healthcare, isn't it? But that's indeed what the linked NYT article says. I wonder if it will work?