Lin Mei: Adhere to the Close Integration of Investing in Physical Assets and Investing in People
Persisting in the tight integration of investing in physical objects and investing in people is an inevitable requirement for entering the New Development Stage [1], and an active choice in planning our country’s long-term development goals. General Secretary Xi Jinping, at the opening ceremony of a specialized seminar for major provincial and ministerial-level leading cadres on studying and implementing the guiding principles of the Fourth Plenary Session of the 20th CPC Central Committee, emphasized: "We must persist in taking the domestic large circulation as the mainstay, correctly handle the relationship between consumption and investment, demand and supply, and persist in the tight integration of benefiting livelihoods and promoting consumption, and investing in physical objects and investing in people, striving to improve the quality and efficiency of the national economic circulation so that internal demand becomes the main driver of economic development." The "15th Five-Year Plan" period [2] is a critical stage for basically achieving socialist modernization. Profoundly recognizing the contemporary significance of the tight integration of investing in physical objects and investing in people, accurately grasping its scientific connotations, and actively exploring its paths of realization can lay a solid foundation for the cause of comprehensively advancing the construction of a strong country and national rejuvenation through a Chinese path to modernization.
1. The contemporary significance of persisting in the tight integration of investing in physical objects and investing in people
"Investing in physical objects" refers to investing in tangible physical assets, including fields such as new infrastructure, urban renewal, and scientific and technological innovation platforms. Through material accumulation, it improves basic conditions and enhances productive efficiency, providing foundational support for economic and social development. "Investing in people," meanwhile, refers to directing more fiscal funds and public resources toward livelihood areas such as education, employment, medical care, elderly care, and social security. It involves investing in the elevation of human developmental capacity, health maintenance, and potential discovery to enhance human capital and release consumption potential, thereby driving high-quality development of economy and society. Its essence lies in enhancing individual knowledge capital and cultural capital by improving people's skills, quality, health levels, and social adaptability, thereby raising the human capital and skill levels of the entire society and transforming "human resources" into "human capital" capable of sustainable value appreciation.
In December 2015, the Central Economic Work Conference [3] proposed the important concept of "investing in people." In May 2023, General Secretary Xi Jinping emphasized at the first meeting of the Central Commission for Financial and Economic Affairs under the 20th CPC Central Committee the need to "tightly integrate 'investing in physical objects' with 'investing in people.'" The Fourth Plenary Session of the 20th CPC Central Committee further proposed to "persist in the tight integration of benefiting livelihoods and promoting consumption, and investing in physical objects and investing in people." Linking high-quality development closely with the people's high-quality life through this integration represents a deepening of our understanding of China's development mode, investment philosophy, and direction. Practicing this concept is of major and far-reaching significance for persisting in putting the people first, constructing the New Development Paradigm, achieving common prosperity for all people, and gaining the initiative in international competition.
A direct manifestation of the People-Centered Development Philosophy. Investing in people is proposed relative to investing in physical objects; it reflects a development philosophy of "seeing the people as much as the objects" [4] and embodies the superiority of the system of socialism with Chinese characteristics. As the efficiency of the traditional model—driven by infrastructure and projects—declines, high-quality development relies increasingly on abundant human resources and the accumulation of human capital. Only by persisting in putting the people first and tightly integrating the material support of investing in physical objects with the capacity cultivation and quality enhancement of investing in people can we strengthen development momentum and push economic development from the previous model of scale and speed toward one of quality and efficiency.
A vital handle for constructing the New Development Paradigm. A strong domestic market is the strategic bridgehead for Chinese-path modernization and a vital support for constructing the New Development Paradigm. The Proposals of the Central Committee of the Communist Party of China on Drawing up the 15th Five-Year Plan for National Economic and Social Development [5] proposed to "persist in the strategic basis of expanding internal demand." From 2021 to 2024, the average contribution rate of internal demand to China's economic growth reached 86.4%, and the average contribution rate of final consumption to economic growth reached 56.2%, reflecting the strong resilience of our country’s ultra-large-scale market. Persisting in the tight integration of investing in physical objects and investing in people helps form a dynamic balance where new demand guides new supply and new supply creates new demand. This enhances the endogenous power and reliability of the domestic large circulation, using its internal stability and long-term growth potential to hedge against the uncertainties of the international circulation, thus fortifying the foundation of the New Development Paradigm.
An inevitable requirement for achieving common prosperity. Currently, people's demand for healthy bodies, beautiful experiences, and capacity enhancement continues to rise. Development-oriented consumption and service-oriented consumption in areas such as education, health and elderly care, culture and sports, and tourism have become new consumption hotspots. Investing in physical objects helps consolidate the material basis of common prosperity and elevates the level of equalization of basic public services between urban and rural areas. Investing in people helps individuals improve their developmental capacity and promotes the improvement of livelihoods and social equity. Practice has proved that taking the guarantee and improvement of people's livelihoods as the priority direction for government public fiscal expenditure is an inevitable requirement for promoting the well-rounded development of the person and achieving common prosperity for all.
A strategic choice for winning the initiative in international competition. As a strategic resource for achieving high-level self-reliance and strength in science and technology and winning the initiative in international competition, talent is a vital indicator for measuring a country's comprehensive national strength. Whoever can cultivate and attract more outstanding talent will occupy the advantage and initiative in competition. Investing in physical objects provides the foundational platform for scientific and technological innovation—ranging from the independent controllability of core technologies to deep empowerment in livelihood areas and the continuous refinement of the innovation ecosystem—further fortifying the development foundation of high-level self-reliance and strength in science and technology. Investing in people focuses on the independent cultivation and recruitment of innovative talent, stimulating the power and vitality of entrepreneurship, innovation, and creativity to form a "talent dividend," enabling talent in all fields to find their place and exercise their strengths. This integration helps accelerate the establishment of a competitive advantage in talent resources, seizing the high ground of technological development and gaining more initiative and discourse power in global competition.
2. The realization path for promoting the tight integration of investing in physical objects and investing in people
Man is the most dynamic factor of production in economic activities, the subject who creates history, and both the starting point and the ultimate goal of development. With the transformation of China's development mode and the profound changes in economic and social structures, the "human" factor has become fully prominent. Emphasizing investing in people in the New Development Stage does not mean ignoring or weakening investment in physical objects; rather, it means integrating the two closely, adjusting and optimizing current investment concepts, directions, and priorities to promote a bidirectional improvement in quality and efficiency between the "physical" carrier and "human" empowerment, ultimately achieving the well-round development of the person and the comprehensive progress of society. To persist in this integration, we must especially focus on establishing systems thinking, optimizing the investment structure, strengthening institutional construction, and promoting the synergistic force of "objects" and "people."
Using systems thinking to coordinately construct the synergy mechanism between "objects" and "people." In this critical period for consolidating the foundation and fully launching efforts to basically achieve socialist modernization, the major proposition of "persisting in the tight integration of investing in physical objects and investing in people" has been put forward. To advance this integration coordinately, we must persist in systems thinking and handle several sets of relationships. First, handle the relationship between the government and the market to better combine an effective market with a promising government. We must both give full play to the decisive role of the market in resource allocation—cultivating more active and creative market entities and guiding private capital to participate in livelihood areas and major project construction to strengthen the foundation of common prosperity—and better play the role of the government by using planning guidance and policy guarantees to ensure the bottom line of people's livelihoods is met accurately and firmly. Second, handle the relationship between the present and the long term. We must focus both on strengthening investment in major infrastructure and livelihood guarantees to achieve the goals of stabilizing employment, enterprises, markets, and expectations, while also looking to the long term by increasing the proportion of investment in basic research, key core technologies in critical fields, and education, providing long-term stable support to accumulate development momentum and abundant talent resources for modernization. Finally, handle the relationship between the whole and the parts. Give play to the overlapping effects of the strategy for coordinated regional development, major regional strategies, and the new-type urbanization strategy to optimize the investment layout of major productive forces nationwide and construct a regional economic layout where advantages are complementary and investment in "objects" and "people" is synergistic.
Optimizing the investment structure and innovating the path of factor synergy to activate the "object-human" synergistic power. Optimizing the government investment structure and innovating the coordination paths of factors are foundational projects for realizing the synergistic development of physical and human investment. Regarding investment in physical assets, we should center on constructing a modernized industrial system and modernized infrastructure system, adhering to the directions of intelligence, greening, and integration. Focus should be placed on new infrastructure such as advanced manufacturing, big data centers, AI computing centers, and quantum communication networks. Simultaneously, the proportion of government investment in livelihood areas must be increased, and bottlenecks hindering the construction of a unified national market must be resolutely broken down to improve investment precision. Regarding investment in people, with the rapid development of AI technology and the accelerated cultivation of new quality productive forces, the gap in high-skilled talent in China has gradually become prominent. We must center on scientific and technological innovation, industrial development, and national strategic needs to strengthen human resource development. This involves constructing a policy support system for the entire life cycle and chain of the population, and strengthening the talent gathering and cultivation functions of scientific research institutions, innovation platforms, enterprises, and science and technology programs to cultivate more top-notch innovative talent. The improvement of individual quality, capacity, and human capital value gained through investing in people is not only a vital component of the well-rounded development of the person but also a key indicator of the elevation of social civilization and a major source of social wealth growth and socio-economic development. Through the balanced development of productive investment and human capital investment, we can achieve the synergistic force of "objects" and "people" and promote high-quality economic development.
Taking institutional construction as the lead to fortify the "object-human" synergistic foundation. Establishing and improving an institutional and policy system conducive to the tight integration of investing in physical objects and investing in people is the key to their synergistic force. We must accelerate the construction of a high-level socialist market economy system, better utilizing the leading role of economic structural reform to drive shifts in overall development through breakthroughs in key areas. We should fully stimulate the vitality of various types of business entities, improve long-term mechanisms for private enterprises to participate in major project construction, and accelerate the perfection of the system and mechanism for the market-based allocation of factors to promote the rational flow and efficient allocation of factors such as capital, talent, technology, and data. We should improve the support and service system for marriage, childbearing, and population development, as well as the public resource allocation mechanism that matches the permanent resident population, promoting the sinking of more public services to the grassroots, their coverage of rural areas, and their tilt toward remote areas and people in difficulty. We must transform production-driven consumption promotion policies and improve long-term mechanisms for expanding consumption. Finally, we should improve evaluation systems and compensation systems oriented toward innovation capacity and contribution, optimize the recruitment system for high-tech talent, and implement the system of paid leave and off-peak vacations, allowing the power and vitality of innovation and creativity to flow fully throughout society, thereby achieving the organic unity of "seeing the objects" and "seeing the people."