General

China, World Beater

 

China
Photo Source: CIA

Everybody in this country seems to be worried that China is going to take over the world. Who would want this world anyway? Seriously though, apparently they haven't noticed, but China has taken over the world. No it wasn't done through military power, it was done with will power and the sheer ability to manufacture goods and cheap prices. Another thing that people fail to realize, is that this is not the first time that a country has done this. One just has to look at England during the Industrial Revolution to realize that this is just a part of life. The country with the cheapest labor force force and with the greatest technology or both, will often be able to manufacture goods that are so cheap that nobody else will be able to compete. China has used every means at its disposal to create cheap goods. From what we have been seeing lately, they probably have even been skimping on the safety inspections of these goods, or there have been some payoffs made. Prisoners have been used to manufacture goods that receive no pay and by the way I see nothing wrong with this if they are legitimate prisoners that have been convicted of committing crimes and not just political prisoners. I often said that is what we should be doing in this country, putting our prisoners to work and while we do that, why not let them make a profit for the country? The business about using slaves however, is just plain barbaric. I say this even though a similar practice is going on in areas of this country. It is the practice of using illegal immigrants and giving them very low wages and threatening to have been deported if they say anything.

Most people, when they look at what China has accomplished, think that they are seeing the entire picture, but I wonder if this is all that there is to it? Could this have been part of the plan to get away with raising oil prices sky high? These oil people are not stupid. When they formed their battle plan to drain this country of funds, one of the key elements of the plan might have been keeping goods cheap so that the cry about high prices of oil would be lessened. What would it have been without these cheap commodities? The cost of American goods would have skyrocketed by now. Importing cheap goods from China has stopped this from happening, but at what cost? We all know that much of our industry in this country has been destroyed. It is true however, that when most people buy small items now, they really don't think much about the price. Just look at all the dollar stores that have sprung up everywhere. You can go into them and buy anything from a can opener to a toilet bowl brush. Some of the things in these stores actually are cheaper than they were 10 years ago. This has definitely cushioned part of the blow of oil price increases. So while everybody is screaming about the loss of American industry, some people, like those in big oil, may not really mean what they are saying.

Chinese Junk
Photo Source: Stock.xching

What does China have that nobody else has that can enable them to make things so cheap? Well we already know they are using prisoners and some factory owners are getting away with slave labor, but aside from that, there is really no reason why any other country with cheap labor couldn't do the same things that they are doing. This stuff goes in cycles and the thing that China had more abundance than anybody was the will and the know how to do this thing. You just have to give them credit for this. if you look at some of the other countries out there that have cheap labor, they are just as capable of producing cheap goods in the same quantities as China, if they really put their minds to it. Let's take India for example. India is a country that may actually surpass China in population, in the near future. India has a lot of college graduates in their country and a huge workforce. There is absolutely no reason why India could not embark on the same course as China has. It might turn out that the only reason that they haven't done this is, that they don't want to tweak the dragon's tale. The two countries are right next to each other and in modern times India has been invaded by China in the past and perhaps they don't want to see this happen again and who could blame them? As we all know India is quickly becoming the place where you'll end up going to, when you have any technology questions. What I mean by this is that the number you call for help with your new television, telephone or computer might well turn out to be a connection to a business in India, where the support force has been contracted.

A country does not have to have a huge population to be able to manufacture cheap goods. After World War II Japan tried its hand at this. There was a big difference in those days and items coming out of Japan were actually junk for the most part and there is no way that these types of items could ever sell today. Most of the items coming out of China are vastly superior to these old Japanese products. One of the most amazing things about China, is that they seem to be in every facet of manufacturing. They are into all sorts of clothing, house wares and even electronics. Who knows what they'll be making next? Made in America used to be a very proud tag to put onto something. We used to make the best televisions, the best cars and the best small appliances, just to mention a few things. Today I don't know of any American television sets being produced do you? Sure some of the old brands are still there, but now these brands actually belong to Chinese, Korean and Japanese companies, who purchased them. It seems that everyone wanted to buy an American brand name. As far as small appliances go, you might have a hard time trying to find one made in the U.S., Yes we still make cars, but our car companies are in a lot of trouble because of dwindling sales. They are finding it hard to keep up with the price and quality of the Japanese and Korean cars. What are they going to do when the Chinese cars come over to this country and are far cheaper than all the other foreign cars? Will the Chinese succeed in making a quality automotive product? They probably will do an excellent job. It may take a few years to perfect their automobiles to the point where they are in the same league as the other foreign cars, but the low prices may make up for this in the meantime. The Chinese have been busily copying many other popular car designs, that have provoked the ire of such companies as Toyota, to only name one, who claims that they had their popular Rav4 copied by the Chinese.

President Bush Meets With The Deputy Chief Of Staff Of China
Photo Source: DOD

I have often said this, but I will say it again. Why can't we build a robotic factory in this country that would manufacture some small appliances. It would have hardly any labor costs and that would make the items very cheap. Why isn't anybody doing this? I think the answer is pretty clear, nobody wants to invest in building a new structure when they can get stuff from China so cheap. You would think that the government would help in financing such an enterprise, but the government is not very forward thinking at all. Such a project would be healthy for us and while it would not create a lot of jobs directly at the factory, it would create them in other support areas. An example of this is that the manufactured items would have to be shipped, requiring drivers and trucks and maybe ships and so on, which all require people. Doesn't it seem strange that a country like United States of America would just sit back and let itself be out manufactured? How did we ever get to this state? why wasn't something done about this when we first noticed that it was happening? We are not stupid folks, we must have allowed this to happen for a reason, that is why I mentioned the oil industry previously, because this just seems to work out so good for them.

Until wages even out all over the world, it seems to me that there will always be new countries coming up with cheaper items. The only way to fight this is with government support. When you look at China, you see a communist country that supports all of its manufacturers. It is very hard to try to compete against this type of thing in an open market. As much as some people don't like to hear this, I have to say that the only way to protect this market would be with either government subsidies or import tariffs. Import tariffs are not the way to go, they would just cause an import tariff war. The way I see, this only leaves government support. Would it be economically feasible for a government to support those sectors of our industry that are in danger? If the government had some way of collecting a return on their money, I don't see anything wrong with that at all. It would almost be like an investment but instead of citizens it will be the government that was investing. President Bush wanted all of us to invest in securities rather than receive Social Security. Why can't he put his money where his mouth is and have the government invest in ailing industries?

If government invested in industry, it would make much of the money back just in the extra taxes that the people that worked for the industries, both directly and indirectly would be paying. Don't get me wrong, I am not advocating that the government bear the brunt of supporting industry, what I am saying is that they could lend it a sort of helping hand by investing in a portion of that industry. That money could be used to lower the prices of the manufactured products and make us competitive again. This is only a temporary measure, because it would be up to industry to learn how to produce items more cheaply. You must have noticed how prices are dropping in certain sectors such as electronics. This makes it even more feasible to create computer controlled machines for the manufacturing process.

I don't know about the rest of the people out there, but I know how I feel. I want to see us making the world's best products again. We have the know how but we don't seem to have the resolution. It is time that this changed. One thing is for sure however, we are certainly not going to be competitive if we use machines that gobble oil as fuel or any of its derivatives. It is just impossible to be competitive at three and four dollars a gallon. Oil greed has cut into the very heart of our society and we have sat back and allowed this to happen. If we want to be a great manufacturing society again, we have to first fix the oil problem. I say this because even if we could manufacture an item without using oil, we would still need it to transport those items, thus raising their cost.



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