Why China cannot be a superpower?
Inside one of my entries in Spanish, I explained a little bit of why China's development looks more like a smart mirage rather than something real. I took as point of reference for my argument the fact of inequality existing beyond the east coast of the country and later proved it by explaining a bit about the existing situation in both Tibet and Xinjiang. China has caused different impressions and opinions all over the world and indeed, these perceptions are shaped by factors such as culture and nationality. Unfortunately, I have found out that most of the positive opinions held about China around the world come from recognised and not very recognised figures inside the business world. It comes to my attention that it is very true that capitalism makes those who practice it very selective (and sometimes, oblivious) in what respects to adequate perception of reality. There are many things that in my view, do not make China that much of a candidate for a superpower and, since we are now living in an epoch in which getting the economy going has become the priority, decision makers have become more prone to be less conscious about other relevant aspects for human conscience.
China, since 2008 has turned into a paradise in many aspects for entrepreneurs and for the international business sector in general. In the country you can find very cheap labour and you do not even have to worry about things like health service or labour insurance. You do not even have to worry about people claiming for high salaries or deal with labour unions. You just give your investment, which the Communist Party gladly takes in and afterwards you get a place for a factory with more than 1000 people producing goods and you can pay them whatever you like and make them work for more than ten hours if you like. Well, in the eyes of some, this is absolutely valid in the name of productivity and utilities for companies. In my view, China shows us today the capitalism that Marx used to criticise in the XIX century and, naturally with such labour conditions, there is no country on the world who is able to compete with such low costs.
China also has very questionable business practices, such as currency manipulation. Many countries around the globe feel overwhelmed and sometimes even miserable when they notice their trade deficit with China. Well, when you are sold something with a certain price in Yuans and then all of a sudden you are told that the exchange rate has changed, naturally it is your currency the one that gets falls in disadvantage. In the case of the United States and other countries, this is one of the many reasons why they are trying to enact more trade restrictions on China. because if prices are not fixed and are manipulated according to convenience, of course any kind of deal with them turns into a bad idea. This situation also makes people to see Chinese as non-trustworthy partners and therefore entrepreneurs are reluctant towards doing any kind of business with them.
The second aspect is concerned with property rights. It is very difficult getting into China without any gurantee of intellectual property protection. Since their production costs are cheaper, they are able to produce similar or the same products under a different name. Many companies around the world have turned almost paranoic when they get visitors from China, and indeed there have been some cases in which a product is realeased and a month or a bit more afterwards, Chinese have now launched the same product with a more substantial comparative advantage: the price. It is obvious that most consumers prefer buying something cheaper however, the question of quality comes in the way.
This comes to the third aspect, the quality of products. China has shown that it can produce quality goods, however in some industries (such as cars and even airplanes) they still have a long way to go. There are things in which there is no comparison with the original products, in the case of artisanal and hand made work, there is a difference in quality. Chinese hands cannot produce that accurately what has been made more than 200 years ago in a country, for observers there is a difference between what is made in the country of origin and what it is made in China. You cannot compare a FAW car with a BMW. Some say that 'China is a good market' Well, I would love to see how they would cope with the two most basic laws of economy: supply and demand.
The fourth thing concerns with violatons of antidoping measures. It is of common knowledge that antidoping is illegal in the business world and, besides of not complying with agreements, it is of the most dishonest and worst practices that can be found around the world. Since workers are paid really low wages and forced to work under poor conditions, then company owners with such low costs, can just fix a price that would make the product 'competitive' but at the same time the price would not cover its production costs. Again, if companies can pay whatever they like to their work force, then they can do the same with the prices and if we add the fact that currency is manipulated then, we have the complete package of an apparently 'competitive product'. Who can compete with that?
The very last but not least important aspect is that I do not think that workers and the rest of China (by 'rest of China' I mean those places outside from Beijing, Hong Kong, Macau, Shanghai, and the whole east coast. Yes, they are very impressive but do not show the real China) could be blind to the conditions under which they live and most importantly, what is happening around them. China has been showing lately a horrible degree of dehumanisation, seen in how people are treated by companies, how children are abandoned and killed because nobody cares about them (like the boy stuck in the pipes or the girl to whom five cars rolled over her until she died) and, in a very personal stance, how prepotent an unbearable those who have become the 'high class' of China are with their fellow citizens. I've seen and heard terrible examples of how those 'business' or 'important' people treat those who are not like them and how servile others are with them. The way in which the CCP treats Tibetans and Uyghurs shows only a bit of how dehumanised the country is. If they treat Han Chinese like the way described above, I cannot imagine Tibetans and Uyghurs....
The fact of a powerful class now ruling the upper spheres of China serves as an irony because if they are supposed to be Communist, then why do we have such a huge inequality to the inside of China? I heard once that 'when the population realises that 90% of wealth is concentrated only in 10% of the population, that will be the end of the country'. If a country is destined to continue growing and an economy is bound to work properly, then there has to be a considerable middle class and also there has to be a certain standard of quality of life. Outside of the big cities of China, I do not see any of the aforementioned elements, which whether they want it or not, make an economy to grow in a healthy way. Quality of life also includes the environment. China consumes half of the country's energetic resources, and pollution seen in many cities is very alarming.
There are more things that could be argued inside this topic, however in my view, the ones mentioned above are of the most important among many. I am not an economist but, I had a small formation in business, which helped me to write this entry. I believe that economic growth with a huge human cost is questionable because in the end, consumers are the ones who move economy and it make it worth, if we are under such unjust conditons, then what is expected then? I believe that China might collapse from the inside not in the same way as the Soviet Union did, because with the authoritatian and 'silencing' measures the CCP has nowadays, this collapse might be more violent. They cannot keep people away from reality for too long therefore, the 'Tiananmen spirit' (represented by people who speak up like Ai Wei Wei or Tsering Woeser), can just turn into a bomb of time.
I will conclude this with a small episode of my life: I was waiting in the immigration line when I was in Los Angeles. I was coming back from Seoul and, the immigration officers were taking a really long time. A Chinese girl, like around 20 or more told me: 'these Americans, they are so unbearable and annoying...they make so many bad things around the world and they believe that they are the best country on the world. I hate coming through here, they take such a long time in this airport' (yeah, when in places like Shanghai they delay you like 2 or more hours...it depends whether you fly with a national or a foreign airline) I just turned to see her and said: 'Well, with the new attitudes you guys are having with the rest of the world, tell me what makes you different from what you are criticising?'
China, since 2008 has turned into a paradise in many aspects for entrepreneurs and for the international business sector in general. In the country you can find very cheap labour and you do not even have to worry about things like health service or labour insurance. You do not even have to worry about people claiming for high salaries or deal with labour unions. You just give your investment, which the Communist Party gladly takes in and afterwards you get a place for a factory with more than 1000 people producing goods and you can pay them whatever you like and make them work for more than ten hours if you like. Well, in the eyes of some, this is absolutely valid in the name of productivity and utilities for companies. In my view, China shows us today the capitalism that Marx used to criticise in the XIX century and, naturally with such labour conditions, there is no country on the world who is able to compete with such low costs.
China also has very questionable business practices, such as currency manipulation. Many countries around the globe feel overwhelmed and sometimes even miserable when they notice their trade deficit with China. Well, when you are sold something with a certain price in Yuans and then all of a sudden you are told that the exchange rate has changed, naturally it is your currency the one that gets falls in disadvantage. In the case of the United States and other countries, this is one of the many reasons why they are trying to enact more trade restrictions on China. because if prices are not fixed and are manipulated according to convenience, of course any kind of deal with them turns into a bad idea. This situation also makes people to see Chinese as non-trustworthy partners and therefore entrepreneurs are reluctant towards doing any kind of business with them.
The second aspect is concerned with property rights. It is very difficult getting into China without any gurantee of intellectual property protection. Since their production costs are cheaper, they are able to produce similar or the same products under a different name. Many companies around the world have turned almost paranoic when they get visitors from China, and indeed there have been some cases in which a product is realeased and a month or a bit more afterwards, Chinese have now launched the same product with a more substantial comparative advantage: the price. It is obvious that most consumers prefer buying something cheaper however, the question of quality comes in the way.
This comes to the third aspect, the quality of products. China has shown that it can produce quality goods, however in some industries (such as cars and even airplanes) they still have a long way to go. There are things in which there is no comparison with the original products, in the case of artisanal and hand made work, there is a difference in quality. Chinese hands cannot produce that accurately what has been made more than 200 years ago in a country, for observers there is a difference between what is made in the country of origin and what it is made in China. You cannot compare a FAW car with a BMW. Some say that 'China is a good market' Well, I would love to see how they would cope with the two most basic laws of economy: supply and demand.
The fourth thing concerns with violatons of antidoping measures. It is of common knowledge that antidoping is illegal in the business world and, besides of not complying with agreements, it is of the most dishonest and worst practices that can be found around the world. Since workers are paid really low wages and forced to work under poor conditions, then company owners with such low costs, can just fix a price that would make the product 'competitive' but at the same time the price would not cover its production costs. Again, if companies can pay whatever they like to their work force, then they can do the same with the prices and if we add the fact that currency is manipulated then, we have the complete package of an apparently 'competitive product'. Who can compete with that?
The very last but not least important aspect is that I do not think that workers and the rest of China (by 'rest of China' I mean those places outside from Beijing, Hong Kong, Macau, Shanghai, and the whole east coast. Yes, they are very impressive but do not show the real China) could be blind to the conditions under which they live and most importantly, what is happening around them. China has been showing lately a horrible degree of dehumanisation, seen in how people are treated by companies, how children are abandoned and killed because nobody cares about them (like the boy stuck in the pipes or the girl to whom five cars rolled over her until she died) and, in a very personal stance, how prepotent an unbearable those who have become the 'high class' of China are with their fellow citizens. I've seen and heard terrible examples of how those 'business' or 'important' people treat those who are not like them and how servile others are with them. The way in which the CCP treats Tibetans and Uyghurs shows only a bit of how dehumanised the country is. If they treat Han Chinese like the way described above, I cannot imagine Tibetans and Uyghurs....
The fact of a powerful class now ruling the upper spheres of China serves as an irony because if they are supposed to be Communist, then why do we have such a huge inequality to the inside of China? I heard once that 'when the population realises that 90% of wealth is concentrated only in 10% of the population, that will be the end of the country'. If a country is destined to continue growing and an economy is bound to work properly, then there has to be a considerable middle class and also there has to be a certain standard of quality of life. Outside of the big cities of China, I do not see any of the aforementioned elements, which whether they want it or not, make an economy to grow in a healthy way. Quality of life also includes the environment. China consumes half of the country's energetic resources, and pollution seen in many cities is very alarming.
There are more things that could be argued inside this topic, however in my view, the ones mentioned above are of the most important among many. I am not an economist but, I had a small formation in business, which helped me to write this entry. I believe that economic growth with a huge human cost is questionable because in the end, consumers are the ones who move economy and it make it worth, if we are under such unjust conditons, then what is expected then? I believe that China might collapse from the inside not in the same way as the Soviet Union did, because with the authoritatian and 'silencing' measures the CCP has nowadays, this collapse might be more violent. They cannot keep people away from reality for too long therefore, the 'Tiananmen spirit' (represented by people who speak up like Ai Wei Wei or Tsering Woeser), can just turn into a bomb of time.
I will conclude this with a small episode of my life: I was waiting in the immigration line when I was in Los Angeles. I was coming back from Seoul and, the immigration officers were taking a really long time. A Chinese girl, like around 20 or more told me: 'these Americans, they are so unbearable and annoying...they make so many bad things around the world and they believe that they are the best country on the world. I hate coming through here, they take such a long time in this airport' (yeah, when in places like Shanghai they delay you like 2 or more hours...it depends whether you fly with a national or a foreign airline) I just turned to see her and said: 'Well, with the new attitudes you guys are having with the rest of the world, tell me what makes you different from what you are criticising?'
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