Death by China

This video should be required viewing. It shows how since joining the WTO, China has uses currency manipulation, protectionism, lack of ethics vis-a-vis workers’ rights and pollution to gain economic dominance. It proves, as the book Poorly Made in China does, that China is outmaneuvering the world when it comes to business competition.

Narrated by Martin Sheen and based on Peter Narravo’s book by the same title, the documentary clearly explains how China’s strategy to decimate its environment costing thousands of lives by allowing rampant pollution, how its currency manipulation works as a tariff, and how they have no plan to open their markets to foreign companies. Instead their game is to steal as much intellectual property they can so that they can just make their own cars, machines, electronics, etc. using the know-how of other countries to move forward.

The experts interviewed have great credentials and their insights line up with what I saw and heard when living in China. The pollution and lack of ethics are not exaggerated. Yes, most of the people I knew were nice, but there is a glaring lack of ethics and the good people were afraid of standing up for what is right. And it’s true that the government’s philosophy is completely contrary to Enlightenment principles.

Once they are on top there will be no catching them. The film shines like on what we should do now.

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Death by China

I’m watching this timely documentary now. You can watch the entire film here. I’ll review it soon.

Martin Sheen narrates.

Poorly Made in China

Peter Midland studied Chinese language and history in college before moving to China. After a few years there he returned to the US to get his MBA at Wharton. While many of his peers went into finance, Midland took the path not taken and headed for Guangzhou to consult for US companies keen to find a manufacturer in China.Poorly Made in China chronicles Midland’s experiences helping US companies navigate these uncertain, often turbulent waters. It’s an engaging must-read for business people and consumers. It’ll make you think differently about China and Chinese goods.

I learned so much from this book that begins with an unforgettable anecdote. Midland is outside with a Chinese client and the industrial stench is unbearable. Reflexively, he exclaims in Chinese, “It stinks.” Calmly, the Chinese man exhales from his cigarette and slowly responds. “I don’t get you foreigners. To me this smells like money.”

Well, right, but the N.Y. Times reported that as many as 700,000 Chinese each year die prematurely due to pollution. So it also smells like death.

I learned new terms like quality fade, quality erosion and quality manipulation, that are all rather self-explanatory, but scary that it’s actually a business tactic in China. Dealings with a shampoo and body wash importer reveal how this works. The first order or so that Midland’s client made were fine. All according to spec. Then, gradually, things changed. The shampoo’s ingredients were modified little by little till eventually, there was a problem because the shampoo would freeze when it got a bit cold.

As time went on the molds for the plastic bottles got thinner and thinner, till when squeezed they broke releasing the shampoo all over. The cardboard for the shipment got cheaper and cheaper till it would break in transit. With the shoddy bottles this could lead to a major mess. Retailers like Walgreen’s and CVS sure wouldn’t tolerate much of these hassles so the importer is sure to lose orders. Yet the factory management couldn’t see that the poor quality might effect their own business.

Once Midland went to tour a factory and everything seemed nice. Clean environment, busy bee workers. A few were rather clumsy like they were very new to the job. When Midland asked a few questions he was whisked out. Then they had him waiting. When he got bored he got up and walked around. Through the window he saw that the factory was completely empty. He’d asked about breaks and this wasn’t a break time. When the woman in charge saw him looking out the window, she freaked. It turned out that this was a big charade and that many new factories have showplace factories for the foreign clients. Some old ones do this too and the foreigners never see the real factory.

Every chapter is engaging and revealing. You’ll laugh, cry and think twice about buying so much from China. Interestingly, Midland points out how China is not learning to value quality as Japan and Korea did when they were at this stage of development. Something to ponder.

After working for a US community college in Guangzhou, I could see so many parallels. Chilling parallels.

N.B. As my colleagues and I settle into China, note that two of us have broken toilets. We’re in newly renovated apartments and the plumbing just isn’t up to par. Today I had an agreement with my colleague that I could use her bathroom if need be. I’m happy to report that a plumber came today, but this is an example of the low quality of manufactured goods. It’s not just the items that are imported. It’s pervasive.