China Cheats.. and Industry Associations Match Fuzzy Math and Apathy to Create Truth

Friday, June 6, 2008 10:03
Posted in category Uncategorized

While delving a bit further into a recent by the GAO following their review of the USTR China report, I came across the Alliance for American Manufacturing website… and more specifically their report CHINA CHEATS

An interesting cliff notes to all the ills that China has brought to the American economy, I was once again reminded of how the same facts and figures can be skewed over and over again to present a picture of “Truth”

The three leading “facts” that they offer up as the foundation for their arguement”

  1. The U.S has lost more than 3.5 million manufacturing jobs since 2000.
  2. A recent EPI study found that the U.S. has lost more than 1.8 million jobs since 2001 just as a result of the U.S. trade deficit with China.
  3. More than 40,000 factories have closed nationwide in the past 10 years.

and were I given the chance to ask the author my questions, I would ask:

  1. What happened to the other 1.7 million jobs? Why were they lost?
  2. What were the conditions by which the jobs were lost?
  3. How many jobs were created by trade with China – This is a question no one asks, but if you think about the number of logistics professionals, China buyers, quality control personnel, bankers, truckers, and so on.. I bet you are well past the 1.8 million that were lost because of China

and the “results”:

  1. China’s cheating practices have cost Americans millions of jobs. It is estimated that from 1997-2006, the growth in the trade deficit with China cost Americans more than 2.1 million jobs.

So if the EPI Study found 1.8 million since 2001, and this study says 2.1 million between 1997 – 2006… then we are actually gaining jobs beck now?

  1. China Products are unsafe (4.2 million Aqua Dot, 1.5 million Sesame Street dolls, a million Cub Scout badges, dog food, etc)

How many of these goods were being sold under a Chinese name? How many were outsourced by a U.S. brand from a US source to a China source? How many of these products had a strong quality control process in place both in China and in the US?

With this being an industry associatino, there really should be no big surprises here. They are doing their job and doing their best to protect the people they represent, but I can only be left to wonder if they would simply leave these half-truths behind and tell their consituents:

1) Americans who are in industries requiring high quantities of low valued added labor are simply not competititve in a global market, and really haven’t been so for a long time

2) Americans who are afraid of losing their jobs should take it upon themselves to seek out educational and training opportunities – and government bodies should provide those opportunities for them

3) the trade deficit is not an indicator of China’s strength, or of America’s weakness, it is a sign of a global realignment occuring and that realignment will continue to provide more benefit to the average American than would be possible otherwise.

No doubt, we are in for more rhetoric to come, and while I will be one of the first to admit that everyone has gone a bit “China crazy” with their “China Plays”, closing the borders to trade would only cost more jobs, do more damage to the global economy, and would only prove to many around the world that American’s really are that disconnected to the world.

Oh – and for the record, China is not the fastest growing part of deficit… oil is.

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2 Responses to “China Cheats.. and Industry Associations Match Fuzzy Math and Apathy to Create Truth”

  1. Thomas Chow says:

    June 6th, 2008 at 10:47 am

    Ah, the joys of nationalism. I think we will be hearing a lot of this sort of stuff given that its an election year.

    That being said, I think it’s ironic that Americans are doing this for 2 reasons in addition. (1) Americans have benefitted from this cheating behavior–we get lower priced goods. It is American consumers who have demanded lower prices. And if an MNC didn’t go to China, it was simply not competitive. If Americans want to pinch pennies and be at the top of the global food chain, but yet be the world’s top manufacturer, which they do, it’s a delusion. (2) America still benefits vastly from this arrangement. Both sides do. It is insanity to think otherwise… for EITHER side. It’s an almost symbiotic relationship. And frankly, I think America has benefitted on the services and white collar front. America sits squarely on top of the value added pyramid… and that’s only possible with manufacturing nations like China.

    I am with you… this sort of stuff is utter nonsense playing to people’s phobias.

  2. Jim Hall says:

    June 11th, 2008 at 10:54 am

    Specifically what are the number of good manufacturing Jobs lost and number of Companies that have fallen due to the Chinese conundrum? And more poignant is what is the US going to do when we need something from a country that falls from our grace (remember Iraq once a friend and ally) and is not an ally of the United states any longer, but manufacturers something critical to our infrastructure or worst yet our national defense.

    Are we just going to call them and order some and they will just send them over. I think not. We used to be a super power now we are at the mercy of the world, Oil, Money, clothing, pet food, etc. etc. etc. We buy everything and make very little. China don’t forget doesn’t acknowledge our intellectual patent laws, So every US company that out sources to China takes the risk every day, of cheap knockoffs being produced and sold to other world markets, as well as us.

    The last decade will surely go down in history as when China purchased, or was given by greedy Corporations (which is all made possible by our own Government, thru tax incentives) the deed to our once great nation.

    Would the last person out of factory please! Turn out the lights.
    Thanks Management

    Ps I have never shopped at Wallmart or any stores of that kind, I personally would rather spend a little more and keep my neighbors fed and money in the domestic market