China’s Economic Growth: A Peek Behind the Curtain
We’ve all been hearing about double digit economic growth China has been experiencing each year. China boasts new millionaires in the hundreds of thousands over the last five years, and has surpassed Japan as the world’s second largest economy. Looking at these facts, it would be easy to assume that China has found an economic system that works quite well; but things are not always as they seem.
If we look at how the country has acquired such immense wealth, and the costs of such growth to its citizens, the picture we begin to see is anything but pretty.
China’s Most Valuable Resource
In any business, profits are increased by maximizing resources. The resource that China has; a billion laborers who have no choice but to work for very low wages and suffer inhumane treatment and social discrimination. While the countries leaders make claims of improved conditions and higher wages, new reports of the blatant mistreatment and exploitation of lower class workers are surfacing all the time.
This may sound like harsh terminology to some, but the Chinese elite have basically turned the rural peasant workers in their country into slaves. Labor unions are outlawed, so companies are basically free to decide what fair wages and treatment are, and workers can do nothing to lobby for better treatment or higher wages. The ongoing class discrimination continues to be an insurmountable hurdle to progress.
Social Stratification in China
There is a very clear demarcation between the ‘haves’ and the ‘have not’s in China. To put in the simplest of terms, the rich have everything and the poor have nothing. The country continues to manufacture products for major corporations like Apple, Dell, HP, Motorola, Nintendo, Sony and Nokia, who benefit significantly from the ultra-cheap labor Chinese manufacturing companies offer.
While consumers in the UK site the egregious human rights violations and exploitation of workers going on in China as a reason not to purchase products made in the country, The U.S doesn’t seem to have the same issue. While American consumers frown upon the condition of affairs in China, they leave their pocketbooks out of the protest.
American corporations know this all too well, and are quick to send their manufacturing business east and reap the significant increase in profits China’s slave labor allows for.
Currency Manipulation in China
There are widespread allegations that China takes measures to undervalue the Yuan, artificially making its exports to the U.S. cheaper and U.S. exports to China more expensive. Legislation has been proposed to raise tariffs on Chinese goods as a countermeasure, but with little effect thus far.
With Apple getting heat about the working conditions at Foxconn, it may appear that things are finally changing. Salaries were raised by 25% and it seems an end has been put to 60 hour work weeks, with the 49 hour limit being enforced. But will these changes last?
A quote from SumOfUS.org, a coalition of consumer groups and trade unions, claims otherwise.
“The report will include new promises by Apple that stand to be just as empty as the ones made over the past 5 years.”