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Level -> The China Price (8/25/2008 3:39:16 AM)
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quote:
With the recent scandals involving tainted food and toys from China, and mounting concern over the ever-growing pollution produced by Chinese industry, it is clear that what happens in China does not stay in China: It has a tangible, and at times devastating, global effect. With The China Price: The True Cost of Chinese Competitive Advantage, veteran foreign correspondent Alexandra Harney has written an exposé of how China’s factory economy competes for Western business by—in her words—selling out its workers, its environment, and its future.
Harney’s book is notable for putting a human face to China’s rapid economic growth by learning about the challenges facing factory workers. Among the book’s major revelations is Harney’s reporting on the little known, but vitally significant, parallel system of factories that operate in China today—the “five-star” facilities that get inspected and audited by foreign buyers, and the “black” unlicensed, un-inspected factories that make some of the products that end up in stores in the west. Notably, all the players in this system demand the “China price”—the workers want more hours so they can send more money to their homes; the foreign buyers want prices that are often unrealistically low, so that the only way for factories to meet it is to massively cut corners and disobeys health, safety, and environmental laws.
Harney’s book notably documents the towering costs of the “China Price” to the world’s largest manufacturing workforce—the Chinese themselves: Horrendous health problems (the worst in the world per capita); the lack of safety inspectors in factories; and the world’s most dangerous coal mines. Harney noted that “the consequences of this system are clear: Western consumers obtain cheap goods, but at a price, to ourselves, and to China.”
Author’s Path to the Book
Early in her career, Harney studied Japanese because she believed them to be her “future bosses,” but while in Japan she realized that all the Japanese were studying Mandarin, which prompted her to move to Hong Kong. While working for the Financial Times, Harney visited factories in Guangdong that served as an inspiration for her book. These were the factories where women made $100 a month and had just enough to buy tissues and soap. At first, Harney worked through a translator and found herself followed everywhere by a Shenzhen public relations representative who called himself her friend. So she changed her name to a Chinese one, improved her Chinese, and traveled around China on her own, conducting most of her research in Guangdong.
Guangdong Province, which produces one-third of China’s goods, has a population of 110 million with over 400,000 factories, some with more than 250,000 employees. If Guangdong was a country, it would be slightly smaller than Saudi Arabia in terms of GDP. The economy is fueled primarily by rural migrants, who do not enjoy state services such as insurance, subsidized housing, and education.
http://www.wilsoncenter.org/index.cfm?topic_id=1421&fuseaction=topics.event_summary&event_id=399140
I saw the author on C-SPAN recently, and her book brings up a number of interesting questions. How long can China keep a lid on wages, and the consequent rise in price to their markets (like Wal-Mart)? If prices go up, then what? There isn't really another China out there to take their place, so the days of cheap stuff for Americans to buy would be over, bringing added pressures to our economy.
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