The core problem the US faces in coping with China is what to do about the huge differential in labor costs.
This is a monstrous distortion. American workers are some THIRTEEN TIMES more productive than a Chinese worker. Albeit, the Chinese worker earns a fraction of the wage, but that communist wage slave also produces a tiny fraction of the overall quality that we see in American products. As West notes, a truly malign influence is that of unions who resist industrial evolution towards automation and other productivity gains in favor of job retention to pay their artificially imposed middle management salaries.
The myth of Chinese labor economy pivots upon the fact that China’s adherence to EPA strictures and other environmental or safety controls is nonexistent. A simple fact: Sixteen of the twenty worst polluted cities in the entire world are in China. This should tell you everything necessary about how wages are kept at falsely attractive levels. It should also serve as a warning about why it is so easy for tainted and substandard Chinese products to reach our shores.
The principal obstacle to thinking about China may be the national elite’s obsession with itself and its petty hobbyhorses.
This disregards the equally poisonous external influence of how so many American political campaign contributors rely so heavily upon Chinese labor for their profit margins. Wal-Mart, The Good Guys, Circuit City, Best Buy and so forth all make massive contributions to BOTH parties and thereby sway our politicians against any real retribution for China’s routinely underhanded manipulation of its currency and trading policy.
Far more ominous are the implications of what sort of outcome awaits continued Sino-ascendancy. China has set itself up for a “perfect storm” of catastrophic economic, societal and environmental disasters.
1.) During China’s recent privatization, the vast majority of government-run big business was essentially handed over to the PLA’s military elite at fire sale prices, who—without a shred of business experience—promptly proceeded to run them into the ground. All the while, these well-connected Mandarins consumed massive loans from banking cronies to prop up these over-staffed and under-equipped enterprises. Government jobs were once known as “cast iron rice bowls”, in that people were so rarely fired that their source of income (rice bowl), could not be “broken”.
Moreover, oil prices continue to escalate—in some part—caused by Chinese arms shipments that exacerbate MME (Muslim Middle East) tensions. Should they rise high enough, bunker fuel costs will erode the profitability of long haul trans-Pacific container traffic and significantly impact the price competitiveness of already shaky Chinese manufacturing enterprises.
END RESULT: Mismanagement has left China with an estimated $500 billion to $1 trillion worth of bad debt that their own prohibitions on foreign majority bank ownership prevents any bailout of. All the while, their MME meddling promises to interfere with the free flow of petroleum exports doing further damage to their own economy. There also exists pandemic official corruption that is tacitly accepted by the government resulting in substandard civil engineering and a host of other dangerous or counter-productive practices.
2.) These same industries have historically operated with total disregard for environmental impact or pollution laws due to their immunity through contacts within the PLA. Examine the near-total absence of significant prosecution for the constant coal-mining fatalities and egregious lack of mine safety.
One single statistic tells the entire story. Out of the world’s TWENTY most polluted cites, SIXTEEN of them are in CHINA. Manmade disasters loom large in China’s future. More than once engineers have had to patch large CRACKS forming on the Three Gorges Dam face. Upstream, rising water has soaked into and destabilized massive earthen cliffs that slide into the reservoir causing destructive waves. There are concerns that these surges may even cause damage to the dam itself. A catastrophic failure of this gigantic hydroelectric project could cause the death of untold MILLIONS downstream.
China has also begun work upon a string of hydroelectric dams at the highest reaches of the Mekong River. This vital aquatic artery for much of Southeast Asia could effectively fall under Chinese control. Retention of too much runoff could cause the collapse of critical downstream aquaculture necessary for rural sustenance while impeding commercial traffic reliant upon riverine navigation. Given China’s rapacious nature, none of this bodes well for its Southern neighbors.
END RESULT: Massive damage to vital natural and regional resources, air quality and some of China’s most precious historical locations or archaeological sites.
3.) China’s “one family – one child” policy has led to endemic gender based abortion and female infanticide. This lopsided demographic is already beginning to affect Chinese society with the “Little Emperor” syndrome of intensely spoiled male children. As both parents toil in day jobs, these brats are left in the care of grandparents. Chinese culture deems even slight deformities as an insurmountable impediment to marriage. By threatening to injure themselves, these “Little Emperors” extort ice cream and candy from their grandparent caretakers. Imagine such manipulative, cosseted and ill-tempered only-children taking command of China’s nuclear arsenal.
Further, the lack of marriageable women can only presage some sort of increase in male homosexuality. Slowly eroding cultural mores will remove some of the stigma attached to homosexuality and lack of female companionship will do the rest. At present, once unmarriageable peasant girls from rural provinces now have their pick of male suitors. Starving North Korean mail-order brides are also being imported to meet this demand.
END RESULT: Extreme potential for a major upswing in male homosexuality. Complicated by:
4.) China’s medically caused HIV/AIDS epidemic is the largest in world history. Henan province plasma buyers re-injected aggregated red blood cells back into similar type donors, thereby spreading the virus like wildfire. Corrupt government officials—more concerned about covering up their connections to these plasma buyers—did little to quarantine or contain the crisis, allowing infected individuals to migrate into large urban centers.
END RESULT: A ticking time-bomb of gigantic proportions that may be facilitated through a host of other societal factors including heavy discrimination against HIV positive people, intense shame over homosexuality and government suppression of publishing any medical statistics regarding this as being damaging to China’s image.
5.) China’s ratio of urban versus rural earning power is incredibly lopsided. Conservative estimates place 1995 rural earnings at 40% of that paid to urban workers. The global figure for that time was 60%. Other estimates place China’s earnings gap at seven to one and even an astounding ten to one ratio. This disparity encourages migration to city centers in search of higher pay. Mao’s promise to break all chains binding peasants to the land was a tremendous lie that found farmers imprisoned by even more intense poverty than before.
END RESULT: Breakdown in agricultural productivity and lack of regulatory oversight in the haste to avoid food shortages. This creates vast potential for tainted goods, which has already manifested in dead infants killed by being fed nutrition-free baby formula, fake rabies vaccines and eggs injected with toxic industrial dyes.
All of the above factors are converging to combine into an onslaught of destructive forces that bode exceptionally ill for China’s future. Such internal pressures may cause civil war or drive China into territorial aggression in order to relieve surging demand for dwindling resources, marriageable women or unpolluted living space. Taiwan, the Korean Peninsula, Japan, Eastern Russia and Southeast Asia all fall under the shadow of China’s looming crises.
