2008 Year in Review

China Syndrome

I've been to Hong Kong and Taiwan and worked with Chinese crews in Singapore, so I don't have firsthand knowledge of the vast and sometimes mysterious country, but I have a clue beyond a movie about a nuclear plant meltdown - or water resource wars in California (hint: Chinatown).

Those who were interested saw a spectacular display of technology, culture and art if you watched any of this year's summer Olympics. Those in the know know that China has become a manufacturing powerhouse primarily due to their cheap and plentiful labor supply and a heavy reliance on their coal resources, hence air pollution problems. It has come to light that if every manufacturing job in the world went to China they would still have a labor surplus with a population of over 1.3 billion people (1/5 of the world's total population). And since we Americans have a strong appetite for cheap goods and we spend billions or trillions of dollars to buy them from China that we pay for with dollars, the Chinese have a huge surplus of dollars. With these dollars they may buy a bit of our agricultural exports and some oil from the Middle East, but for the most part they have to invest in the US or convert to other currencies at a loss. The end result is that China is lending us money because we Americans also like cheap credit.

The Chinese are industrious and, from what I could see, quite avid gamblers which makes them naturals for a market economy. I heard that at the time, more money was wagered in a single day at the race track in Hong Kong than in an entire year of racing in the US. In the shipyards of Singapore a Chinese crew would work diligently and all hours to perform their contractual duties, but wouldn't think of working over during the Chinese New Year's festivities. Some things are sacred.

When I was growing up the favorite motherly cautionary tale was to eat and appreciate all your food because there were starving children in China. Sadly it was true at the time, but now we can take heart that this growing engine of an economy has reversed that trend and there is little starvation in this most populous of nations. On the other hand we must remember that the vast majority do not live a lifestyle of plenty like we still enjoy here in the US and if they did there would probably not be enough resources on the planet to feed the demand. So here we go again: we compete for resources which drives the cost of everything (food, energy, raw materials) up on a global scale.

China is slightly larger than the US in total area and has been home to advanced civilizations for the past 4000 years and a unified nation with a common lingua franca (Mandarin Chinese) since about 200 BC. Except for the last 200 years when China closed itself off from the world and suffered famine, war and occupation, the country has led the world in innovation and creativity. It looks like the cycle is returning China to former glory.

Enjoy the Chinese food (which I do believe is an Americanized version) at our local restaurant. The folks there tell me they used to live close to Hong Kong, only 18 hours away. Now I don't know if that was walking distance or train or bus or bicycle, but they've come a long way and show no signs of slowing down or stopping.

by Marc Adami, Guest Columnist
October 3, 2008