Wednesday, 28 October 2015

Rule #71: Made in China

Ever wonder why you can buy a product that was made half way across the world for half the price of the same product produced at home?

Slave labour: If there's ever a place on earth that needs the help of
unions, it's China. But they don't have unions. I wonder if it's because everyone's happy with their work environment or because you go to jail for trying to form a labour union? Chinese companies don't have to deal with the cost of labour laws or employment standards.

Prison labour:
  Depending on how you feel about criminals, you may not care how China treats their prisoners. But there's 2 big problems to consider; 1) Because these prisoners are producing products for a corrupt, communist government and more prisoners equals more production, we have to wonder if people are being wrongly incarcerated. 2) Producing products with free labour gives China a serious trade advantage, making western competition impossible.

Environmental neglect: American companies have the cost of complying with hundreds of years of environmental standards. Chinese companies don't have these environmental standards or the associated costs. That's why 16 of the worlds 20 dirtiest cities are in China. Less than 1% of China's urban air meets standards set by the European union. Heavy metal, water, air pollution... China has it all. And the ultimate irony is that this pollution is not going to remain specific to China. All that water and air pollution will find it's way around the globe eventually. As a matter of fact, it's estimated that 25% of the particulate matter falling in California is from China. Basically it's much cheaper to neglect the environment.

Currency manipulation & export subsidies: Most economists say China gets a 25 - 40 cent advantage on every dollar by devaluing it's currency. This basically makes exporting to China 25 - 40% more costly for American or Canadian companies while giving Chinese companies an export subsidy of 25 - 40%. Which is illegal.

It's important to distinguish between the good, hard working people of China and the corrupt, communist, underhanded government.

China joined the WTO in 2001. Since then 57,000 factories have moved operations to China. It was supposed to open fair trade between China and America. America exporting to China and visa versa. Instead, what has happened is China shipping boatloads of cheap crap over here using illegal export subsidies and in return all America is shipping over there is boatloads of jobs and money. Now America is into China for 3 Trillion bones, or clams. That's right $3,000,000,000.00. That's a lot of chopsticks. I wonder what will happen when it's time to call in that debt? I can just see Obama rummaging through his suit pockets.
But hey, who want to pay more than $50 for a 1000" big screen t.v. Am I right?

In the new world, trade with China will be shut down.



  1. Sorry, couple days behind. It’s busy here. Lots of people not coming to work.
    Fckin right I’m all over this one! How many years have I been preaching this?
    At least the millions and millions that read this blog will start reading labels.
    I only buy Made in China, when I absolutely must have the product, and I have no other option.
    The Koreans should be nuking them soon anyway, so it should work itself out

    Debt...that will be repayed in Bombs and Blood during WWIII

  2. An interesting perspective on the whole thing, I read your blog quite often and most of it has me nodding in agreement, but this one has me scratching my head a bit. I do not believe more than halve of a single digit of Chinese people are actual slaves who can not walk away from their job and find work elsewhere.

    Just a few raw statistics here to explain why the pay is so much less.

    China's GDP / Population
    8.227 trillion USD divided by 1.35 billion people =
    $6, 094 per year per person.

    USA GDP / Population
    15.680 trillion USD divided by 314 million people =
    $49,936 per year per person.

    Something to consider also though, due to the low wages, everything "Made In China" is dirt cheap in china, including food and other such things, so often $1 000 in China will go further than $10 000 in the USA.The only time US type wages are needed would be to import first world products, or go traveling to the first world.

    Source: I have spent halve my life in the third world.

    There is an interesting book called "Confessions of an economic hit man." you might find interesting.

    Peace out, I will go back to reading some of your other posts and start nodding again.

    1. Good info. I'll put economic hit man on my list to read.
      While I don't doubt that slave labour stats may be exaggerated in the media here, the low wages and use of prison labour makes western competition impossible. This is contributing to the decline of manufacturing jobs in America. I think the fact that our wages are higher is reason to pay more and keep our money at home.
      Thanks for reading.

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