Posted by: nickgerlich | August 27, 2007

Bump In The Road?

My wife and I have two beautiful daughters. Like most parents, we stand back and gaze at them with admiring eyes, their biggest supporters.

Our girls do not look the least bit like us. Whereas Becky and I are fair-skinned with dishwater blonde hair, our daughters have yellowish skin and black hair. And try as you might, you won’t find these three words printed on their back side, but it is still very obvious for all who see: They were Made in China.

Chinese ToysThose three words have stirred up a hornet’s nest of controversy this year, thanks to massive product recalls. Pet food. Toothpaste. Tires. And now toys by the gazillion. Consumers and consumer groups are staging boycotts of Chinese-made goods, for reasons ranging from fear over unsafe merchandise and economic jingoism to political diatribes over the “failed” attempt of free markets to democratize China. (Read about a family who tried to live one year without “Made in China,” and about an online retailer who actively boycotts China.)

Say or do what you want, but the fact of the matter is, China is the manufacturing sector of the entire world. There is little that is not made in China and exported around the globe. But there’s also no doubting that China’s reputation is suffering these days.

Hit the Rewind button (that’s the Skip-Left button on your DVD player or iPod) and go back 35 years, and you will find a Japan that faced the same problems. This was before Toyotas were legendary, Seiko kept time with the best Swiss-made watches, and anyone knew how to correctly pronounce Mitsubishi. But it did not take long for Japan to emerge from cheap industrial copycat to world-class innovator and the king of quality. Just in time, too, because Japan was tagged with an image problem no different from what China faces today.

Is it fair to bash China in light of all these recalls? Or should we cut them some slack and hope they become the next Japan? If you consider that 80% of the world’s toys are made in China, it stands to reason that if there are ever any problems, China will no doubt be involved. But it’s also hard to deny that corruption exists throughout China’s political and commercial communities. They are an economy struggling to catch up with the 21st century, and rapid industrialization can hold hostage any concerns about product safety or the environment. Jobs are jobs, money is money…and China needs more of both. With 1.3 billion people to feed and an economy that is being allowed to expand virtually unfettered for the first time ever, these may be growing pains…unpleasant ones, for sure, but no less typical of what countries like the US experienced when it industrialized a century ago.

There’s little doubt in my mind that China has a long way to go when it comes to civil rights. Beijing has a hard time acepting the fact that there are millions of Muslims in western China, and the Tibet problem simply will not go away. No matter the best centralized efforts to force assimilation upon China’s numerous subcultures, these ethnic minorities cling to their heritages.

And let’s not ignore the thought and speech police. While China should at least be recognized for allowing the internet in at all, its censorship insults western sensibilities. The images of Tiananmen Square from 1989 have not blurred. Michael Moore should thank his lucky stars he’s making films in the US.

In The World Is Flat, Thomas Friedman’s landmark 2005 book, the offshoring of jobs is argued to be an inevitability. Manufacturers will always seek out the low-cost labor provider. Accounting, programming, and customer help desk jobs are clustered in India, while basic manufacturing is scattered throughout China. Telecommunication and transportation allow for the rapid dissemination of both data and goods.

We need not concern ourselves as much with the ability of either nation to do good work, as much as we should fear their inevitable rise to fully-developed innovating economy. Right now, the west innovates, and Asia implements. Japan (and to a lesser extent Korea and Taiwan) are but the first eastern nations to demonstrate that they can keep pace with the west in creating rather than just duplicating. Give China 10 years, and you will see an entirely different nation…one exporting autos around the world, writing software applications, developing the computer of the future.

How you spend your money, and whether you stand back and gaze at them with admiring eyes is up to you.

Dr “Shock Absorber” Gerlich

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