Core Viewpoint - The discussion centers on whether the Chinese economy is recovering or heading towards recession, with domestic economists leaning towards recovery while some foreign analysts predict a decline similar to Japan's "lost thirty years" [3][4]. Economic Conditions - The root cause of the current economic situation is identified as the shrinking final consumption rate and widening income distribution gap, leading to slower growth in household income compared to economic growth, resulting in insufficient consumer spending [3][4]. - Since the implementation of "proactive fiscal policy" after the 1998 Asian financial crisis, the final consumption rate has decreased annually by 1-1.4%, dropping from approximately 62.9% to around 50%, which is 15% lower than the world average and 20% lower than developed countries like the U.S. [3][4]. Demand and Recovery - Insufficient domestic demand is highlighted as a decisive factor for economic growth, and without improvements in national income distribution, genuine economic recovery is unlikely [4][5]. - The World Bank's 2023 report indicates China's Gini coefficient at 0.465, exceeding the international warning line of 0.4 and nearing the extreme inequality threshold of 0.5, which contributes to the current consumer spending inadequacy [6]. Policy Recommendations - To achieve healthy economic development, reforms in the redistribution system are necessary to narrow the income gap [6]. - The macroeconomic policy should shift focus to address existing issues rather than relying solely on "double proactive" and "counter-cyclical" measures, emphasizing adjustments in fiscal expenditure structure to increase social spending and reduce infrastructure investment [6][7]. Economic Cycle Insights - The existence of a socialist economic cycle is acknowledged, suggesting that the blind pursuit of high GDP growth disrupts economic development laws and leads to prolonged stagnation and slow recovery [7][8]. - The management approach post-crisis often neglects the restoration of economic proportional relationships, focusing instead on preventing downturns, which can extend stagnation periods [8].