Greg Autry

Fighting for space, not over it.

Don’t Let the Door Hit You on the Way Out American Corporate Friends, Bye Bye!

monopolyYou just can’t make this stuff up! A Shanghai court has convicted U.S. based Johnson & Johnson of violating Chinese “anti-monopoly” laws. Really, this from the One Party State? According to the Chinese state media monopoly “The market for medical instruments in China faced a lack of competition.” What a hoot in the land of State Owned Enterprises.

Although the multinational firm was fined a measly 530,000 yuan, the decision is indicative of an accelerating trend, where local government regulators and media actively work to damage the reputation of Western firms who have been doing business in China for a long time.

Other recent moves to harm American firms include the parade of stories deploring the sanitation of our fast food chains like McDonald’s and KFC. An astounding charge to those who know anything about the horrific nature of Chinese food production. Chinese media reports claimed ice served at KFC was often “dirtier than toilet bowl water.” Which, in my personal experience, would make it a lot more appealing than the Yangtze river. Of course, if they made their ice with water from the Shanghai municipal water monopoly it would be full of bacteria from the thousands of dead pigs floating in the water source.

Another fun story has been the barrage of attacks on Apple that came after Tim Cook made the announcement he would be moving some manufacturing back to the U.S. Gotta love the article entitled “Defeat Apple’s ‘Incomparable’ Arrogance” from the folks at the People’s Daily. This from a government that believes it is their right to determine what Chinese readers read and when possible, think. As soon as China can find a domestic smart phone OS (think buying out struggling BBRY), Samsung and Apple can kiss this market good bye. Of course, in the meantime Cook got on his knees to kiss the ring of the communist media.

The real goal here is to tilt the playing field in favor of Chinese domestic firms by undermining the powerful legitimacy foreign products have in the eyes of Chinese consumers. It is also a subtle way of  inviting American companies to leave China. Having brought the capital, technology and know-how to China, they are no longer necessary. Being unnecessary they are also unwelcome and have been shown the door.

This does not surprise those of us who understand China’s history. The go to strategy for Chinese Communist leaders since Mao has been to fawn on their enemies until they get what they need  from them and then arrange an arrest on trumped up charges or perhaps a convenient airplane crash. Watching the arrogance and gullibility of American CEOs play out on this stage would be darn humorous, if it were not for the  jobs, national wealth and global power that we’ve lost in the process of enriching this oligarchy of thugs.

Greg Autry serves as Senior Economist with the American Jobs Alliance, Economist with theCoalition for a Prosperous America and is co-author (with Peter Navarro) of Death by China: Confronting the Dragon – a Global Call to Action. He blogs regularly at: http://www.gregautry.us/blog  and on the Huffington Post.

An Offer We Must Refuse

 

It’s not my job to really understand what they’re going to use it for. Our job is to respond to the bid. – Todd Bradley, Hewlett Packard Executive Vice President for China Strategy

He who does not prevent a crime when he can, encourages it. – Seneca

 

 

 

Recently, formerly American, multinational tech firms Cisco and HP have participated in the initial bidding process to provide networking hardware for “Peaceful Chongqing”, an ambitious government project to install HALF A MILLION “crime fighting” cameras in that Chinese industrial city.[1] A noble effort indeed, until one considers exactly what local Communist Party Boss, Bo Xilai might consider to be a “crime.”  Bo is a big promoter of restoring “Mao Tse Tung Thought” to China and in the last few years he has erected a NEW seven story tall Mao statue in Chongqing and compelled its radio and TV stations – all government controlled – to repack their song lists with communist standards from the Cultural Revolution. The list of crimes that might worry this wannabe Big Brother are sure to include offenses like “political protest” and “illegal religious congregation.”

 

The pathetic statement from HP’s Mr. Bradley that opens this piece is quietly becoming the “I was only following orders”[2] of our day. Whether any American company actually follows through or wins a part of this nefarious project is irrelevant. The attitude that sent them chasing after it in the first place sounds the depths of the amoral abyss into which America’s once proud multinational businesses have fallen in their tragically misguided pursuit of “economic freedom”.

 

Seriously, is selling security equipment to a communist autocracy that jails and tortures millions for political and religious dissent how to follow “The HP Way?” – Bill Hewlett and David Packard are surely rolling in their graves. Is profiting at the expense of another people’s liberty and financing a massive military build-up aimed at America, the “pursuit of happiness” that Jefferson wished to secure for us?

 

Even worse, while America’s hypnotized CEOs queue up like cattle at a slaughterhouse for the opportunity to do the bidding of the Chinese Communist Party (CCP) our politicians are eagerly funding the Boy’s from Beijing’s dark designs with your tax dollars. Huge government projects that – if they are necessary in the first place – should be creating American jobs are instead fueling the unsustainable economic growth that keeps the CCP in power. Perhaps the saddest example of this is the new Bay Bridge segment connecting San Francisco to Oakland that is now being built in China.[3] The obvious quality concerns aside, it is tragically ironic in that California’s most familiar symbol is the proud American steel of the Golden Gate! While all that welding and riveting goes on in Shanghai, thousands of unemployed Californian construction workers and civil engineers scramble for low paying jobs at Wal-Mart in the hope of being able to sell some Chinese junk to their neighbors that still have jobs.

 

If that isn’t enough, many American states and municipalities are lining up to hand over their economic development projects to the CCP in a desperate search for investment dollars. The sad thing is, that when nominally-American multinationals invest more and more of your 401k bucks in China, the Chinese government forces them into a minority position in a joint venture dominated by a Chinese state owned “partner”, but the Chinese firms buying up America are offered a big helping hand by our states in setting up US operations that are fully-owned by these same communist state enterprises. It doesn’t take a finance PhD to figure out how that process is going to work out for everyone.

 

In a particularly bold example, the state of Idaho has chosen to lure Sinomach, a Chinese state owned firm to build a huge industrial park near the Boise airport in order to secure a few hundred assembly jobs. Like most other big Chinese firms, its board and management are filled with members of the Communist Party elite and politburo. The firm’s website proudly brags of board members like Li Zhanyong, Deputy secretary of CPC & Secretary of discipline inspection committee.[4] Yep, that’s who we want to be offering our precious investment incentives to! Idaho Commerce Secretary Don Dietrich made the sellout, 100% clear when he told the Idaho Statesman, “The Chinese are looking for a beachhead in the United States. Idaho is ready to give them one.”[5] Of course no Idaho firm would ever be allowed to develop a project like that in Chengdu. LOL!

 

But not to worry, our clever business leaders and astute politicians have done their due diligence. They’ve traveled first class to luxury hotels in Beijing and Shanghai, hit the tourist sites, toured some model factories, and been treated to fabulous meals! Given the typical modus operandi of China’s “Party Bosses” they’ve also been drunk under the table, and likely been tempted by some other “honey pots”, while government spies, aided by the police, searched their hotel rooms and hacked their electronics.[6]

 

These naïve American’s invariably fly home ready to create business opportunities for their new BFFs! Not having been invited to tour the local Reeducation Through Labor camp it is hard for them to realize that their new buddies carry a big stick right behind those fake smiles. When the time is right, we will feel that stick just like anyone in China who steps out of line. Let us not forget that Mr. Bo’s beloved Mao taught his followers that, “All power flows from the barrel of a gun.” The current communist cadres have simply fused that advice with Al Capone’s suggestion, from the Untouchables, that “You can get further with a kind word and a gun than you can with just a kind word.”

 

To get a Chinese perspective on who it is you are really dealing with in China I strongly recommend that every business person, investor, and traveler read Baiqiao Tang’s fabulous book, My Two China’s[7] before you enjoy that sanitized view of the Middle Kingdom your hosts will prepare. Tang’s harrowing tale of protest, imprisonment, torture, and escape are a far cry from the official China spectacle your soon-to-be BFFs are preparing.

 

For a tragic, real world example of how the Chinese system can really treat Americans and the sad level of US complicity in the process, please take a look at the case of Darren Russell, a young man murdered in Guangzhou. You can read about it at http://www.officer.com/article/10248849/what-happened-to-darren-russell-in-china and http://www.russellcase.net/

 

If all this disturbs you as much as it has me, please join us in sending a note to the management at Hewlett Packard and Cisco letting them know just what you think about their backing of China’s police state and how that might impact your own brand choices in the future. Let your governor and your state legislators know that America can solve its problems on its own, without going into business with the Chinese Communist mob.

 

– Greg Autry teaches Macroeconomics at the Merage School of Business, UC Irvine and is co-author (with Peter Navarro) of the new book “Death by China” www.gregautry.us


[2] The standard defense presented by Nazi’s, like Adolf Eichmann, and their collaborators at the post WWII war crimes tribunals.

[4] http://www.sinomach.com.cn/templates/T_leaders_en/index.aspx?nodeid=213

[6] I can tell you that I’ve had my own hotel safe ransacked in Beijing and my email and phone communications intercepted in Shanghai. But if you doubt that, read about the blunt warning from Britain’s MI5 agency to UK business leaders – http://www.timesonline.co.uk/tol/news/uk/crime/article7009749.ece

[7] Order it from our Amazon affiliate site here: http://deathbychina.com/bookstore.html

 

Counter-Revolution!

And this I believe: that the free, exploring mind of the individual human is the most valuable thing in the world. And this I would fight for: the freedom of the mind to take any direction it wishes, undirected. And this I must fight against: any idea, religion, or government, which limits or destroys the individual. This is what I am and what I am about. I can understand why a system built on a pattern must try to destroy the free mind, for that is one thing, which can by inspection destroy such a system. Surely I can understand this, and I hate it and I will fight against it to preserve the one thing that separates us from the uncreative beasts. If the glory can be killed, we are lost.

 

– John Stienbeck, (East of Eden)

 

Sunday evening, the day before Memorial Day, I’m flying over the Land of the Free with a perspective that renders our nation’s flaws invisible. We are heading West and I’m looking down at deep snow on the Rockies; a late spring thaw feeds the Colorado River as it begins its long trip South to the Sea of Cortez. There is a vast flat layer of clouds ahead, stretching out over Arizona, all brilliantly lit with the golden glow of another perfect sunset over the beaches of my native California. It is a fittingly glorious return from a weekend in the presence of inspirational greatness.

I had been invited, by my friend Tang Baiqiao (My Two Chinas) to spend two days crammed into an unremarkable, hot, and crowded conference room in a small hotel in the Flushing neighborhood of Queens. I was there to speak to a group that by Sunday afternoon had agreed to name itself the China Democratic Revolution Federation.

My hosts were a group of Chinese men and women from a variety of backgrounds that shared a long and hard-earned resentment against the regime in Beijing. They had gathered to commemorate the Centenary of China’s lost democratic revolution and hold an annual observation of the June 4 tragedy in Tiananmen Square.

Many Americans are sadly ignorant of the story of China’s 1911 revolt that buried the corpse of the corrupt Qing dynasty. The democratic movement was led with high expectations by the brilliant Sun Yat Sen. A new China had woken from its long opium coma and was prepared to boldly step forward and take its rightful place among the ranks of great progressive nations. Tragically, Sun’s embryonic republic was trampled by warlords, Japanese invaders, and finally stolen by Mao’s gang of Communist thugs.

The stuffy room in Queens was packed with businessmen, lawyers, waiters, and artists. They were Buddhists, Christians and non-believers. They’d come out of Hunnan and Yunnan and fled Beijing and Shanghai to settle in California, Georgia, Alabama, and New York. I encountered a collection of disparate souls who had fled from a vast and diverse nation and had been scattered across another. And yet, their differences were invisible. Although many of them had not met before, they were at once a family, united by decades of suffering and resigned to years of hard work ahead. Work in bringing down the criminal government that rules their homeland. This remorseless regime has recently accelerated what is already the world’s biggest campaign of repression against the mind and spirit of humankind. This ratcheting up of arrests has pulled in thousands of citizens and a few notables like world renowned artist Ai WeiWei.

What was to be a most insightful weekend began with a ride from JFK in the company of Guo Baosheng ,a Christian minister in San Francisco who had been jailed for years in the 1990s for advocating human rights and fled to America after having his “unauthorized church” closed by the Chinese police.

During much of the conference translation was provided for me by two Falun Gong practitioners – a practice horribly repressed in China – have dedicated themselves to curing the moral cancer of Marxism one soul at a time via their work running the “Global Service Center for Quitting the Communist Party.”

I met several souls who lived through the horrors of June 4 and had a most interesting interview with Yan Xiong. Yan was a young man, just days shy of graduation, who made repeated trips through the hail of AK-47 fire hauling the bleeding bodies of fellow Beijing University students from the streets around Tianamen to the hospital on a rickety bicycle. It was a day he still remembers as though it were yesterday. The reward China offered for his heroism under fire was nearly two years in a prison camp – much of it in solitary confinement or shackles, everyday of it of it on the edge of starvation. Yet, as if to prove Nietzsche right, Yan emerged strong and is now a Captain in the US Army! He is serving as a chaplain at the Warrant Officer Career College at Fort Rucker, Alabama after completing a tour of duty in Iraq.

After the public meeting broke late Saturday, we all headed out for dinner in the Little Shanghai that Flushing has become. I sat with a journalist, an attorney, and Huang Xiang, a quiet and introspective poet and artist, who after the meal and more than a few toasts stood to deliver a frighteningly animated rendition of his poem “Wild Beasts” – the story of a powerful, wild animal captured, tortured, and destroyed, but stubbornly free until the bitter end. His long, grey hair flew about as he stomped around the Beijing Duck Restaurant like a visitor from “Where the Wild Things Are” and his smiling eyes sparkled as he snarled the ending line, “Even though barely a bone is left, I want this detestable age to choke on me.” After this, the sister-in-law of Ai WeiWei stopped by to offer her regards.

The next day we returned to the practice of democracy and honed a plan of action to recapture the world’s attention that has so selfishly turned its gaze from victims of Tiananmen to the shelves of WalMart. You will be hearing from them and it will be time for us all to sit down and take a moment to listen to what they have to say and for Americans to remember that our founding fathers not only gifted us with liberty but also burdened us with the responsibility to defend it!

Will we join the Americans before us who sacrificed to end slavery, fight fascism, secure Civil Rights, and bring down the Soviet’s Evil Empire? Or, will we sell out my Chinese friends to “Save Money, Live Better” at WalMart and trade other people’s liberty – and someday our own –  for access to a “huge market?”

Make your decision carefully, but stop pleading ignorance.

 

–       Greg Autry teaches Macroeconomics at the Merage School of Business, UC Irvine and is co-author (with Peter Navarro) of the new book “Death by China” www.gregautry.us