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LOL China will still have a larger homogenous population than the USA by that time.
By that time the USA will be so multi-culturally contrived, civil war will be constantly lurking around the corner.
Pffft. Put down the Epoch Times. What do you actually know about China? I'm not an expert on the country, but I studied Chinese history a lot in college and kept up on my reading since then, plus done business over there. China is nowhere close to homogeneous. Until less than a century ago, it wasn't even a true politically-unified country. A peanut farmer from Georgia, a Maine lobsterman, an Aleut, and a Guamanian have more in common than Chinese from disparate parts of that country.
It's not just that China will see its workforce slashed by 250 million. It's that it will have to contend with an enormous elderly population with robust average life expectancy. There is nowhere close to a mature pension system, there's no support network, and the chief investment of Chinese hasn't been in their rickety stock market but in the grotesquely overbuilt real estate market.
At this point, something like 30% of all housing units in China are unoccupied investment property. This is an astonishing number without precedent, a witch's brew of bad local government policy, the lack of trust in Chinese securities, and the country's terminal demographics. So this means that enormous amounts of the country's GDP have been sunk into assets that will never return a dime, chiefly because the country's population will be falling off a figurative cliff. There will literally be no one to occupy these massive housing developments ever. Trillions of renminbi will literally crumble into desuetude, taking the financial fortunes of hundreds of millions of Chinese with it.
What's more, the country's GDP numbers aren't to be believed, because they're not based on capital generation but rather on throughput. This is why China has this massive overproduction of housing without anyone to actually reside in them. Because they treat this malinvestment as a way to boost their economy and keep people working. An economist termed China the 'national equivalent of Enron,' which is about as good a characterization as I've ever heard. In other words, they'll rack up impressive numbers until the entire Ponzi scheme falls apart. As a result, twenty-thirty years from now, the average Chinese family of husband and wife will be struggling to keep 3-4 elderly parents alive while clinging to worthless property investments. That in turn means sharply reduced discretionary spending, etc., etc. Just a death spiral.
China benefited over the past 25 years from an anomaly, a historical glut of inexpensive labor of working age, a surplus that makes our Baby Boomer generation look small in comparison. But it was a one-off with couples having one child. Even if every Chinese couple of child-bearing age started making the beast with two backs tomorrow to produce another couple of children (Which they won't) it will take thirty years to make up the shortfall. By that time, it's too late.
Want a taste? Here's a great video blogger who lived in China for ten years. This particular video encapsulates in layman's terms the country's coming nightmare pretty well:
China has issues. The USA has issues. Both nations should worry about their own issues and trade/engage in business transactions when it's mutually beneficial. Outside of that, the two nations are on the opposite side of the globe and have no reason to concern themselves with that the other is doing, unless it directly effects the other.
The USA should do more to ensure it has adequate manufacturing/production capacity to service it's own needs, should the need arise. We got used to having cheap, easily exploitable labor at our disposal, ready and willing to do our work cheaper than we would care to pay our lowliest members of society to do. That won't last forever. It may not even last much longer. You can't blame China for our complacency. We did that ourselves, and China built their post modern civilization on the ashes of our crumbling/worn out manufacturing base.
Could you even entice America's young people to do this type of work, or would you have to bus people in from south of the border to do it for us? They would do it for a price most Americans would refuse to pay. American consumers would go without before paying livable wages for the work/opportunities we discarded.
I agree completely. When I hear people cheer at "bring the jobs back to America!!" rallying cry, I always think wait till their $250 72" TV costs $600. WE sent the jobs over there in the first place because we wanted a 4 bedroom house with 6 TVs instead of 1 TV for the whole house. That desire to accumulate isn't going anywhere, and that's why the jobs aren't coming back en masse. We had the choice decades ago, between Walmart/China and local business/American made, and it wasn't even a close outcome. We chose Walmart/China by a landslide. That wouldn't be any different today, regardless of the cheers to the abstract "build it here!!" chants that gin up the rally crowds.
I agree completely. When I hear people cheer at "bring the jobs back to America!!" rallying cry, I always think wait till their $250 72" TV costs $600. WE sent the jobs over there in the first place because we wanted a 4 bedroom house with 6 TVs instead of 1 TV for the whole house. That desire to accumulate isn't going anywhere, and that's why the jobs aren't coming back en masse. We had the choice decades ago, between Walmart/China and local business/American made, and it wasn't even a close outcome. We chose Walmart/China by a landslide. That wouldn't be any different today, regardless of the cheers to the abstract "build it here!!" chants that gin up the rally crowds.
In truth, some manufacturing is already coming back for any number of industries. For example, microchip plants under construction in Arizona. Another, oddly enough, is textiles. Advances in automation are now making it cheaper to make textiles in this country than it is overseas. The stretch of states from Arizona to the Atlantic are seeing the beginning of a manufacturing renaissance. So what you say isn't completely accurate.
Another example? Automotive. I can literally walk out my door, hop in my car, and reach eight Japanese, Korean, and German automotive manufacturers within a 2-hour drive (Or most of them. The outliers if I really speed and don't hit any traffic). And with those, a constellation of suppliers. The reason for that is pretty simple, and it isn't because manufacturers in those countries are keen to give jobs to Americans. The reason is that their working age populations are dwindling and they literally can't find enough workers.
The reasons jobs went overseas were for multiple reasons. First, automation had not caught up to labor costs. Second, the tax and regulatory structure in this country made costs sky high. After all, the corporate tax rate was the highest among all developed countries.
Speaking of chip plants, Andy Grove of Intel gave an amazing speech about eleven years ago. He made a simple point. If you took two identical chip plants and built one in Asia and one in the United States, the one in the United States would cost twice as much. Yet only 10% of the difference in cost was due to higher labor costs. The other 90% were in taxes and regulatory costs. So the building of those chip plants in Arizona is proof of this theory.
I'm not a fan of Donald Trump no way, no how. I would have crawled on my naked body over broken glass to vote for just about anyone but him back in November. But even a broken clock is right twice a day. Cutting corporate taxes down to EU levels (Example, the US corporate tax rate is now 20%. Sweden's is 21.5%) made it a lot easier to manufacture in this country from a cost standpoint. For those who argue that it hasn't yet produced the massive uptick in jobs, my response it so simply wait. It's not like you can just put up factories and train workers overnight.
However, where your example is on point is for inexpensive consumer goods such as televisions. Even then, that doesn't mean those product are manufactured in China. Instead, they'll go to Indonesia or India or somesuch that actually has respect for intellectual property rights. In truth, the place most likely to see those sectors for manufacturing is Northern Mexico.
Not only is there a renegotiated NAFTA deal in place, but it also means a much shorter supply chain. As someone with a client who had to wait 16 weeks from order fulfillment to container ship to final delivery from a factory in China, that's a huge factor. As another example of why this is becoming such a big deal, shipping costs per container have risen more than 60% since the beginning of the year--assuming you can even get your container loaded on a ship. The backlog at east Asian ports is jaw-dropping, chiefly because Covid and its variants are beginning to wreak havoc on economies throughout the region. This is in stark contrast to a year ago when it was the Western economies who were shut down while the Asian economies were still churning away.
Aside from the general lawlessness of Chinese apparatchiks, another compelling reason has been the extraordinary rise in Chinese labor costs. Those have risen by a factor of 11 since 2000. So China's one thing it had to sell, cheap labor, doesn't exist any longer.
In fact, it might be that the Chinese themselves push out foreign manufacturing. Ham-handed as usual, they've enacted a new law that punishes foreign companies operating in China for the sanctions their home countries impose. Personally, if I were a company with actual operations in China at this moment, I'd be crating up the machinery, computers, and people and moving out to some place less hostile. Before the party bosses stroll in and take over my factory.
In truth, some manufacturing is already coming back for any number of industries. For example, microchip plants under construction in Arizona. Another, oddly enough, is textiles. Advances in automation are now making it cheaper to make textiles in this country than it is overseas. The stretch of states from Arizona to the Atlantic are seeing the beginning of a manufacturing renaissance. So what you say isn't completely accurate.
Another example? Automotive. I can literally walk out my door, hop in my car, and reach eight Japanese, Korean, and German automotive manufacturers within a 2-hour drive (Or most of them. The outliers if I really speed and don't hit any traffic). And with those, a constellation of suppliers. The reason for that is pretty simple, and it isn't because manufacturers in those countries are keen to give jobs to Americans. The reason is that their working age populations are dwindling and they literally can't find enough workers.
The reasons jobs went overseas were for multiple reasons. First, automation had not caught up to labor costs. Second, the tax and regulatory structure in this country made costs sky high. After all, the corporate tax rate was the highest among all developed countries.
Speaking of chip plants, Andy Grove of Intel gave an amazing speech about eleven years ago. He made a simple point. If you took two identical chip plants and built one in Asia and one in the United States, the one in the United States would cost twice as much. Yet only 10% of the difference in cost was due to higher labor costs. The other 90% were in taxes and regulatory costs. So the building of those chip plants in Arizona is proof of this theory.
I'm not a fan of Donald Trump no way, no how. I would have crawled on my naked body over broken glass to vote for just about anyone but him back in November. But even a broken clock is right twice a day. Cutting corporate taxes down to EU levels (Example, the US corporate tax rate is now 20%. Sweden's is 21.5%) made it a lot easier to manufacture in this country from a cost standpoint. For those who argue that it hasn't yet produced the massive uptick in jobs, my response it so simply wait. It's not like you can just put up factories and train workers overnight.
However, where your example is on point is for inexpensive consumer goods such as televisions. Even then, that doesn't mean those product are manufactured in China. Instead, they'll go to Indonesia or India or somesuch that actually has respect for intellectual property rights. In truth, the place most likely to see those sectors for manufacturing is Northern Mexico.
Not only is there a renegotiated NAFTA deal in place, but it also means a much shorter supply chain. As someone with a client who had to wait 16 weeks from order fulfillment to container ship to final delivery from a factory in China, that's a huge factor. As another example of why this is becoming such a big deal, shipping costs per container have risen more than 60% since the beginning of the year--assuming you can even get your container loaded on a ship. The backlog at east Asian ports is jaw-dropping, chiefly because Covid and its variants are beginning to wreak havoc on economies throughout the region. This is in stark contrast to a year ago when it was the Western economies who were shut down while the Asian economies were still churning away.
Aside from the general lawlessness of Chinese apparatchiks, another compelling reason has been the extraordinary rise in Chinese labor costs. Those have risen by a factor of 11 since 2000. So China's one thing it had to sell, cheap labor, doesn't exist any longer.
In fact, it might be that the Chinese themselves push out foreign manufacturing. Ham-handed as usual, they've enacted a new law that punishes foreign companies operating in China for the sanctions their home countries impose. Personally, if I were a company with actual operations in China at this moment, I'd be crating up the machinery, computers, and people and moving out to some place less hostile. Before the party bosses stroll in and take over my factory.
My point was more to the hypocrisy of those who scream “Bring the factories back, bring the jobs back!†While driving past their local hardware store on the way to Home Depot.
Maybe tech will level the playing field. One can only hope. I wish too we’d find away to get drug manufacturing back here.
I’ve read companies are pulling out of China due to rising costs, but they are going to Africa instead. Ivanka moved her shoe factory from China to I believe Nigeria. China has seen this trend coming, and has developed a huge presence in Africa over the past two decades. They own and run a lot of factories there now.
I repeat, China is not a monolith.... No matter how much they try to market themselves as such.
Quote:
Originally Posted by MinivanDriver
Pffft. Put down the Epoch Times. What do you actually know about China? I'm not an expert on the country, but I studied Chinese history a lot in college and kept up on my reading since then, plus done business over there. China is nowhere close to homogeneous. Until less than a century ago, it wasn't even a true politically-unified country. A peanut farmer from Georgia, a Maine lobsterman, an Aleut, and a Guamanian have more in common than Chinese from disparate parts of that country.
It's not just that China will see its workforce slashed by 250 million. It's that it will have to contend with an enormous elderly population with robust average life expectancy. There is nowhere close to a mature pension system, there's no support network, and the chief investment of Chinese hasn't been in their rickety stock market but in the grotesquely overbuilt real estate market.
At this point, something like 30% of all housing units in China are unoccupied investment property. This is an astonishing number without precedent, a witch's brew of bad local government policy, the lack of trust in Chinese securities, and the country's terminal demographics. So this means that enormous amounts of the country's GDP have been sunk into assets that will never return a dime, chiefly because the country's population will be falling off a figurative cliff. There will literally be no one to occupy these massive housing developments ever. Trillions of renminbi will literally crumble into desuetude, taking the financial fortunes of hundreds of millions of Chinese with it.
What's more, the country's GDP numbers aren't to be believed, because they're not based on capital generation but rather on throughput. This is why China has this massive overproduction of housing without anyone to actually reside in them. Because they treat this malinvestment as a way to boost their economy and keep people working. An economist termed China the 'national equivalent of Enron,' which is about as good a characterization as I've ever heard. In other words, they'll rack up impressive numbers until the entire Ponzi scheme falls apart. As a result, twenty-thirty years from now, the average Chinese family of husband and wife will be struggling to keep 3-4 elderly parents alive while clinging to worthless property investments. That in turn means sharply reduced discretionary spending, etc., etc. Just a death spiral.
China benefited over the past 25 years from an anomaly, a historical glut of inexpensive labor of working age, a surplus that makes our Baby Boomer generation look small in comparison. But it was a one-off with couples having one child. Even if every Chinese couple of child-bearing age started making the beast with two backs tomorrow to produce another couple of children (Which they won't) it will take thirty years to make up the shortfall. By that time, it's too late.
Want a taste? Here's a great video blogger who lived in China for ten years. This particular video encapsulates in layman's terms the country's coming nightmare pretty well:
It still more consistent and similar than the USA will ever be. Remember the different peoples in China, have had like two thousand years to get to know each other, and get used to one another.
American multiculturalism is a recent fabricated phenomenon. China does not even have a massive influx of refugees, or immigrants, or H1Bs job stealers.
When the Chinese print out/create money out of thin air, do they indebt themselves to those that apparently have no vested interest in the rest of the country like USA apparently does?
Building all that real estate is not that big of deal because they dont have to pay anyone back with rent they are suppose to collect.
This same ability means they can easily take care of any elderly they wish with a snap of the finger. As for a ponzi scheme, what do you think the USA is basically especially its financial system? USA will crack before China.
It still more consistent and similar than the USA will ever be. Remember the different peoples in China, have had like two thousand years to get to know each other, and get used to one another.
American multiculturalism is a recent fabricated phenomenon. China does not even have a massive influx of refugees, or immigrants, or H1Bs job stealers.
When the Chinese print out/create money out of thin air, do they indebt themselves to those that apparently have no vested interest in the rest of the country like USA apparently does?
Building all that real estate is not that big of deal because they dont have to pay anyone back with rent they are suppose to collect.
This same ability means they can easily take care of any elderly they wish with a snap of the finger. As for a ponzi scheme, what do you think the USA is basically especially its financial system? USA will crack before China.
Wow. You really don't know Chinese history, do you? Not a scrap, evidently.
Underestimate China at your own risk. We need to build up manufacturing capability in the USA, especially critical items like pharma and electronics. People need to pay up and buy American (buying cheaper from real ALLIES is ok also).
China is not our friend, they are responsible for tens of thousands of US deaths from fentanyl every year, and their evil cover-up of COVID is responsible for over half a million US deaths.
It is effectively impossible to "pay up and buy American" by now. I've tried it. It's not possible because China can do it cheaper than anyone else, so that's what stocks the shelves. America is more concerned with greed above all else and has invited China into our daily consumer lives. How much "made in America" merchandise do you think is stocked on the shelves at Walmart and all other big box stores? Very little. It's not even available if we WANTED to buy American. There'd be nothing but empty shelves if Walmart stopped buying Chinese-made goods. Same with Home Depot, Lowes, K-mart, etc. We did this to ourselves by sabotaging American manufacturing, which also resulted in untold number of American jobs lost, because we sold our soul to get cheaper (and inferior) crap from China.
You think it's China's fault that drug addicts are dying from fentanyl overdose that they've supplied? Let's put the responsibility on the right people here - the person who chose to take an illegally-dispensed drug. Doesn't matter where it comes from. No one forced it down their throats.
China's "evil coverup of Covid" has never been proven. Until it is, IF it ever is, stop spreading unfounded misinformation.
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