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Old 11-20-2009, 12:26 PM
 
11,807 posts, read 21,373,538 times
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Free trade is good. High tax burdens on corporations are bad.
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Old 11-20-2009, 02:28 PM
 
Location: So. of Rosarito, Baja, Mexico
6,651 posts, read 18,610,771 times
Reputation: 6100
I have a question that maybe someone with knowledge can answer.

When I go to Home Depot and buy a ceiling fan from a American named company while the box states "Product of China" on it.

Question is..."What would the price be in China for the same product considering their implied "slave wages"?

In reality the chinese economy is a lot lower cost wise compared to the wage scale and cost of living in the US.

Any knowledged answers?

Steve
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Old 11-20-2009, 06:16 PM
 
47,546 posts, read 45,245,703 times
Reputation: 15190
Quote:
Originally Posted by Steve Bagu View Post
I have a question that maybe someone with knowledge can answer.

When I go to Home Depot and buy a ceiling fan from a American named company while the box states "Product of China" on it.

Question is..."What would the price be in China for the same product considering their implied "slave wages"?

In reality the chinese economy is a lot lower cost wise compared to the wage scale and cost of living in the US.

Any knowledged answers?

Steve
I have a very good question:Where does that leave the American worker? The cost of living here is higher than in China. That is why people could use a decent job. How do you expect people to live off of China's wages in the USA?
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Old 11-20-2009, 10:01 PM
 
Location: Great State of Texas
86,093 posts, read 72,290,637 times
Reputation: 27564
Quote:
Originally Posted by Steve Bagu View Post
I have a question that maybe someone with knowledge can answer.

When I go to Home Depot and buy a ceiling fan from a American named company while the box states "Product of China" on it.

Question is..."What would the price be in China for the same product considering their implied "slave wages"?

In reality the chinese economy is a lot lower cost wise compared to the wage scale and cost of living in the US.

Any knowledged answers?

Steve
Most of the folks in China can't afford what they make. That's why their exports here are so large.
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Old 11-20-2009, 10:24 PM
 
Location: So. of Rosarito, Baja, Mexico
6,651 posts, read 18,610,771 times
Reputation: 6100
Not sure if the last post was directed to me.

I do NOT expect any in the US to live off the China's wage scale be what it may be.

As a teen I had a sat job that paid me 25 cents an hr...$1.00 for four hrs.

At that time a fresh loaf of bread at the bakery was .09 cents.

Today min wage is about $7.00 an hr with a loaf of bread going for around the $3.00 mark.

So as wages go so does the cost of Food/Rent and all the necessities in life.

My question was to the cost (price) of the ceiling fan in China considering their low pay scale and cost of living.

If material and labor are a lot cheaper then the Retail price should also be more affordable I would think.

I would also think that the fan here being $59.95 may only cost $9.95 over there.

I can understand the cost of shipping/transportation from a long distance but still wonder the initial production cost of some items that are sold here.

Have never been to China but did spend one yr in Japan during Korea. Do remember their economy was not the best considering the aftermath of the war.

Am still waiting for some informed answer to my question...anyone?

Steve
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Old 11-21-2009, 11:26 AM
 
Location: The Woods
16,935 posts, read 22,198,202 times
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Quote:
Originally Posted by wheelsup View Post
Free trade is good. High tax burdens on corporations are bad.
Free trade is bad for most people.
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Old 11-22-2009, 03:07 PM
 
Location: down south
514 posts, read 1,432,356 times
Reputation: 650
Quote:
Originally Posted by Steve Bagu View Post
I have a question that maybe someone with knowledge can answer.

When I go to Home Depot and buy a ceiling fan from a American named company while the box states "Product of China" on it.

Question is..."What would the price be in China for the same product considering their implied "slave wages"?

In reality the chinese economy is a lot lower cost wise compared to the wage scale and cost of living in the US.

Any knowledged answers?

Steve
Difference in price between product available both in the US and China can mainly be attributed to the different cost in brand, transportation, handling, tax and extra overhead associated with retailing.

Take clothing as an example, in large Chinese cities, at current exchange rate, jacket that costs $45-$60 and similar priced shoes are enough for a young guy to not feel ashamed of himself in front of most trendy materialistic girls, if he's not in a mating mood, $30 to $50 is enough for a young guy to not stand out in a bad way among his peers. If he's poor, unemployed or cheap, he can make do with $20 or so clothing, in summer, less than $10.

New car sells for $7000 to $10000 from domestic manufacturers, brand new small car can be brought with as low as $5000 from domestic manufacturers. International brand costs a lot more and are usually out of range for most 20 somethings.

The whole "slave wage" debate is quite misleading (not totally off the base because absolute pay is still much lower than regular American salary even taken into consideration undervalued Chinese currency.) because you and many Americans look at the whole issue through a wrong perspective. It's not really about absolute pay scale or even pay scale adjusted for purchasing power. It's the social and economic structure of China that makes these seemly slave wage much more of a "living wage" than pure number, absolute number or purchasing power adjusted number, suggests.

The most obvious example would be the extra cost one pretty much has to assume in the US: car, gas and all the money associated with maintaining the car. Without a car, outside of a few major cities, it is extremely difficult if not impossible for anybody to hold a job in the US, whether you're doing a minimal wage job or CEO job. For China, indeed, for most countries, public transportation is perfectly adequate in meeting the basic transportation demands. Here lies the core problem for low wage earners in the US: even though you're technically making much more than your counterparts in China, but he doesn't need to have a car to go to work, to buy grocery or to go out for date, drink or something else. But you have to, or you'd have a hard time going to work on time, to buy grocery, etc. As a result, your discretionary income is several hundreds dollars lower than the number on your pay check (gas, insurance, + the money for maintenance and initial purchase of the car), even though your expense on car doesn't increase your standard of living in any obvious way. (well, some people might feel that driving to work/grocery shopping is in itself an sign of increased standard of living. I don't think so, I don't think walking/taking bus/biking/taking metro to work renders my life less "livable".) Also because of cultural reasons, few Chinese college students have to assume crushing debt to finish their education, their families will usually pay for it (which introduces a major cause of China's high saving rate, parents need to save early on for their kids' education and other needs. The argument often employed by American parents such as "we have our own life to live", "he should pay for his own education since he's an adult" simply won't fly in China. Giving him the highest education he could attain and helping him lay the foundation for his own family are considered parental responsibilities as important as feeding and clothing your kids. Sure, not every parents can fulfill all the responsibilities expected of them, but that's the social expectation and usually they will try as hard as they can to pay for all the thing mentioned above. Chinese, indeed, Asian parents are often willing to make sacrifice for their kids few Americans can imagine.), which means that Chinese educated young adults often don't have to deal with a major expense American young adults often have to deal with, when both groups are at the early and poorest stage of their career. There are few other expenses that Americans have to pay for while Chinese don't have to. You get the gist. I won't list all of them here.

On a macro level, current Chinese growth model hinges on two factors: high growth to absorb extra labor (domestic investment in infrastructure and, obviously, export are the twin engines off growth); low domestic price for essential goods to make a "slave wage" in American economic context an acceptable wage, not a good wage, a very low wage, a wage many people would gladly ditch if other opportunities arise, but nonetheless a "livable" wage. People ain't stupid, if it's not "livable", nobody is going to work for it. America built an infrastructure for "American dream", but if you can't afford American dream, you often still have to pay for many expensive elements of American dream because there is no other way around it, as a result, the "living wage" in America and "slave wage" in America only apply to, America.

Of course, current Chinese growth model isn't sustainable over the long run because of resource limit, inevitable rise in labor cost and how much upgrade you can do to your infrastructure (during Asian financial crisis, China relied on stimulus, especially stimulus invested in upgrading highway network, this time, the stimulus went to upgrading railway network.) Chinese government knows it and they know eventually they will have to let their currency appreciate if only to increase standard of living and reduce their foreign currency reserve. But now is not the time, certainly not in the middle of a crisis when export still accounts for many jobs, yes, jobs that pay not so well, but nonetheless, jobs. That's why Obama didn't get what he wanted during his visit to China. What they were doing over the past few years such as pushing rural residents to buy cars, gradually establishing a national heath care system, scraping tuition for primary and secondary education, massive investment in renewable energy, global scourging for resources are either designed to stimulate domestic demand, which is the ultimate solution to over-reliance on export, or securing access to resources to buy time so that their export engine will have some sort of cushion against what seems like an inevitable rise in commodity price. Of course, these policies may or may not work. hope of Obama's and many others, both for and against him politically, that China would somehow turn outward to help the US achieve its agenda is wishful thinking at best. Chinese economy is at the crux of another major transformation whose success is crucial to China's future. Domestic and international stability are paramount for China. To expect China to divert attention to help out the US shows an startling lack of understanding about what China's priority is. Chinese leadership uniformly brushed aside the whole G-2 suggestion as absurd clearly showed that they're in no mood to get themselves involved in trouble abroad regardless what American agenda is.
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Old 11-22-2009, 06:40 PM
 
Location: Grove City, Ohio
10,110 posts, read 12,330,696 times
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Quote:
Originally Posted by GregW View Post
See what happens when the government gives money to businessmen. The traitorous slime balls turn and bite the hand that fed them. The panels made in China should have a countervailing tariff equal to twice the savings in production costs. These panels should be made in America by union workers.
All this while union workers in Michigan will gleefully shop WalMart for great prices without bothering to notice practically nothing WalMart has for sale is made in the USA. Giddy with bargains they will be but does this make them "traitorous slime balls"?

Why union members when only 20.1% of workers are union? Because I am non-union I deserve to starve to death in the cold, right?

This whole rhetoric is where the union leadership and membership screwed themselves up. They adopted a "us vs them" stance failing to recognized union workers are the small minority of workers. This tiny minority, to win over friends and supporters, calls non-union Americans scabs while throwing bricks at their cars.
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