Countermeasures Of Building And Perfecting The Legal System Of National Debt In Our Country

Modern public debt originated in Britain and played an irreplaceable role in the rapid expansion of the British overseas forces and the growing strength of its economy, with the further development of the national debt market, the function of national debt has also constantly expanded and many developed countries have also issued a series of national debt’s legal system in order to protect the good operation of the national debt market and the good play of its function.In China, the national debt is the national public debt issued by the central government and plays an important role in China’s economic operation process, such as making up the deficit, raising funds for public construction and helping the government to implement macro-control. Especially as an important means for government’s macro-control, it can adjust the distribution of residents’income, guide the direction of investment, adjust the industrial structure, optimize the allocation of resources and eventually ensure the realization of macro-control’s objectives. National debt as an economic activity must be stipulated and protected by a sound legal system. That is, we have to formulate a "national debt law". The"national debt law" is the basic law to adjust the social relations occurred in the process of national debt’s issuance, use, reimbursement and regulatory management. It can promote the legalization of the national debt’s functions, regulate the activities of the national debt market to protect the participants’rights and interests and promote the further development of the national debt market. With the national debt market developing rapidly and the theoretical study of the national debt deepening, they have laid a solid foundation for the formulation of the "national debt law." Therefore, formulating the "national debt law" in our country is feasible.Our country has not yet issued "national debt law", the current national debt’s legal system has a lower legislative level and legal effect and is also not systematic, authoritative and stable. What’s more, some systems are not perfect and coordinated. All of these lead to many problems in the national debt’s actual operation. Firstly, the issuer of the national debt has not been stipulated by a authoritative law that gives some local governments an opportunity to issue the local government bonds in disguise. Secondly, the national debt’s scale is growing too fast and its varieties and term structure is not reasonable. Moreover, inadequate supervision on the use of bond funds leads to the low income of the bond investment projects. All of these problems will threaten the government’s financial security. Thirdly, our country does not have a unified and efficient government bonds circulation market and the bond market is artificially divided into inter-bank bond market, the exchange market and the bank counter market. What’s more, the transactions of the circulation market is relatively simple, which is not conducive to improve the liquidity of the national debt’s circulation market, the increase in trading volume and to carry on effective risk avoidance. Lastly, the divided national debt’s circulation market has also caused the confusion of the national debt’s regulatory body, which affects the effectiveness of the regulatory. These problems above have seriously restricted the good play of the national debt’s function and the further development of the national debt market. So it is very necessary and urgent to establish the "’national debt law" and perfect the national debt system.The national debt market of some developed countries abroad started early and they had accumulated some valuable experience in the continuous exploration and practice of the national debt market, particularly in the United States and Germany. The United States had established a good bond circulation mechanism, including a sound system of primary dealers, a variety of transactions, an efficient and unified national debt’s trust and clearing System. Moreover, it also established a unified securities regulatory system in which Securities and Exchange Commission was responsible for the supervision of the entire U.S. bond market. All of these experiences are worth learning. Germany had the Europe’s most important and liquid national debt’s market and what was most worthy for us to lesson was its management of national debts. Federal government established a wholly-owned holding company called "the federal financial agency company" which was specifically responsible for the issuance of government bonds. What’s more, the company can also participate in bond trading activity in the secondary market on behalf of the government which can stabilize and animate secondary market. The German government also attached importance to the prevention of the risk of the bond market and especially paid attention to the assessment of the risk of interest rate and market. It also developed a number of risk prevention indicators, strengthened the management of the balance of treasury cash and debt which ensured the national financial security and guarantee the repayment of the national debt. All of these experiences are also worth learning.In view of this, China must speed up to formulate and perfect the national debt’s legal system in order to protect the good play of the national debt’s function and the orderly operation of the national debt market. The country can firstly build the basic framework of the "national debt law" and then continue to perfect the specific systems. We have first of all to get a clear understanding of the independence of the national debt’s legislation and put it separated from Securities Law. Secondly, it is very important for national debt’s legislation to clarify its purpose. Thirdly, the national debt’s legislation must follow certain legislative principles, including strictly following Constitution, the rule of law, democracy and the objective situation to ensure that the "national debt law"can really play an important role. Lastly, in the specific construction of the national debt’s legal system, it has to fully considerate the status quo of the National Debt’s legal system as well as problems of the operation of national debt market and combined with successful experience of the U.S. and Germany to specifically develop and perfect the national debt’s legal system. Firstly,"national debt law"’has to confirm the issuer of national debt and make detailed provisions on the way, the time and the reasonable structure of its issue. Secondly, it has to build an efficient and unified national debt circulation market and make detailed provisions on the trading participants, places, ways, rules and other aspects. Thirdly, it has to make specific provisions on the use and repayment of the national debt funds. Lastly, it has to make specific provisions on the powers and duties of the government regulators and industry self-supervision organizations, especially it can try to establish a National Debt Market Regulatory Commission to manage all of the regulatory agencies in order to change the status of regulatory confusion and improve regulatory efficiency. In addition, it has also to make specific provisions on legal responsibilities for violating the national debt’s legal system in order to roundly establish and perfect our country’s national debt’s legal system.