Yeah runner it looks like that, but believe me we won't go down easy and we will take as many of you bastards down with us if that is our fate. Believe that. The consequence of the combination of arrogance, ignorance, poverty, and massive military might is something the world should consider when dealing with an ailing superpower.
"The China Price" - The best business article I have seen in years.
- Thread starter SouthAmerica
- Start date
Shoes have always been produced in the countries with the cheapest labor. thats the business.
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areyoukidding? : Shoes have always been produced in the countries with the cheapest labor. Thatâs the business.
******
SouthAmerica: I was using the shoe industry in Brazil as an example of how fast Chinese competition can put you out of business.
What are you trying to say with your comment?
I said: âBrazil was a major producer of shoes in the 1960âs, 1970âs, and 1980âs.â
Are you implying that Brazil had a lower cost of labor than China in the 1960âs, 1970âs, and 1980âs?
And that China became a lower cost of labor only in the late 1980âs when they destroyed the shoe industry in Brazil overnight â with their stealth competition.
(I mean stealth like in American Stealth bombers, you canât see them coming, and by the time you realize they are around - it is too late and they annihilate their target.)
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areyoukidding? : Shoes have always been produced in the countries with the cheapest labor. Thatâs the business.
******
SouthAmerica: I was using the shoe industry in Brazil as an example of how fast Chinese competition can put you out of business.
What are you trying to say with your comment?
I said: âBrazil was a major producer of shoes in the 1960âs, 1970âs, and 1980âs.â
Are you implying that Brazil had a lower cost of labor than China in the 1960âs, 1970âs, and 1980âs?
And that China became a lower cost of labor only in the late 1980âs when they destroyed the shoe industry in Brazil overnight â with their stealth competition.
(I mean stealth like in American Stealth bombers, you canât see them coming, and by the time you realize they are around - it is too late and they annihilate their target.)
.
yes. During 60's 70's, china was not open to foreign trade so its labor costs did not count. Like most of africa today is still not open to foreign trade.
Same here in europe. Before shoes where made in france, then with the opening of trade and the break down of customs, all production moved to Italy and French business were devastated. Now, it is moving from Italy to China ...
By 2020, china will be too expensive. china will not want to produce shoes if it can get the same product for lower prices somewhere else and free its ressources to create more wealth.
The shoes industry will move to another place, probably Africa.
This is the basis of economics.
But because China, india potential resources are huge, it will take time. but they will not sell you shoes if you don't sell them something. They look after their interest, they are not stupid
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Mercury 160: By 2020, china will be too expensive. China will not want to produce shoes if it can get the same product for lower prices somewhere else and free its resources to create more wealth.
The shoes industry will move to another place, probably Africa.
This is the basis of economics.
*****
SouthAmerica: I donât agree with you in that one.
Chinaâs labor force is vast and today 70 percent of the Chinese population - who are peasants - still living out of their local very old agricultural system.
But as China economy develops in the near future, these people will be displaced and they will flood the already overpopulated major Chinese towns. If only half of these people decide to move to the large Chinese cities plus the regular growth of the population, we are talking about 600 or 700 million people moving to town. The Chinese will need to build approximately 30 new cities of the size of Sao Paulo or Mexico City (about 20 million people)
Today, China probably has 150 million Chinese living the good life; with a good job and a decent standard of living, and then you have the other China with 1.2 billion or more people living in poverty.
Today, China has a major problem keeping its labor force of 800 million people employed - out of an estimated total population of 1.3 billion people. China has to import as fast and as many jobs as they can from around the world.
China is not building the foundations of its economy by using only their vast labor force â they are also developing the leading edge and state-of-the-art technologies of tomorrow â and that implies using a lot of technology and very little labor.
A friend of mine returned recently from a trip in Japan, and he could not believe what he saw in Japan â a factory almost 100 percent automated â he went to visit a factory that had a handful of people operating the entire place â that is the future of factory production.
China will have a vast pool of very cheap labor for a long time in the coming decades.
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Mercury 160: By 2020, china will be too expensive. China will not want to produce shoes if it can get the same product for lower prices somewhere else and free its resources to create more wealth.
The shoes industry will move to another place, probably Africa.
This is the basis of economics.
*****
SouthAmerica: I donât agree with you in that one.
Chinaâs labor force is vast and today 70 percent of the Chinese population - who are peasants - still living out of their local very old agricultural system.
But as China economy develops in the near future, these people will be displaced and they will flood the already overpopulated major Chinese towns. If only half of these people decide to move to the large Chinese cities plus the regular growth of the population, we are talking about 600 or 700 million people moving to town. The Chinese will need to build approximately 30 new cities of the size of Sao Paulo or Mexico City (about 20 million people)
Today, China probably has 150 million Chinese living the good life; with a good job and a decent standard of living, and then you have the other China with 1.2 billion or more people living in poverty.
Today, China has a major problem keeping its labor force of 800 million people employed - out of an estimated total population of 1.3 billion people. China has to import as fast and as many jobs as they can from around the world.
China is not building the foundations of its economy by using only their vast labor force â they are also developing the leading edge and state-of-the-art technologies of tomorrow â and that implies using a lot of technology and very little labor.
A friend of mine returned recently from a trip in Japan, and he could not believe what he saw in Japan â a factory almost 100 percent automated â he went to visit a factory that had a handful of people operating the entire place â that is the future of factory production.
China will have a vast pool of very cheap labor for a long time in the coming decades.
.
As usual, you're wrong Southamerica.
While you might like to think that fully automated production factories are the future, and previously have been, the 'china effect' has introduced a whole new variable - essentially free labor.
Go read Ted Fishman's book 'China inc.' where fully automated factories in Japan have lost out to completely low-tech factories in China that are mostly based upon human capital. Why? Because the labor costs in China are cheaper than running the fully Automated factory in Japan
If that isn't a major wake up call, I don't know what is. It takes every tenent that our economy so far has been based upon - increasing reliance on automation, fewer laborers, capital equiptment purchases - and turns it on its ass. Why should I invest in major capital equiptment when I will be undercut by my competitor who is using what is effectively human slave labor? And why can't we perpetuate this by shifting production from country to country as exchange rates and labor adjust?
The chinese will do the same as everyone else as they grow wealthier- grow lazier and expect more for less. Filial duties in China are much more significant than in the states and the wealthy good son (which has been preferentially raised over the good daughter) will support mom and dad with some extra disposable income. Wages will rise, with taxes imposed to support the communist party officials' rising wages to make it comparable.
China will not forever be the low labor leader, but I am afraid that we have entered a 'great leap forward' out of automation and into human labor for the forseeable future. Welcome to the arbitrage of labor.
I think the 2020 estimate is realistic.
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drsteph : While you might like to think that fully automated production factories are the future, and previously have been, the 'china effect' has introduced a whole new variable - essentially free labor.
***
SouthAmerica: Jeremy Rifkin has been among the most influential authors in the US in the last 20 years. Right now I am reading his latest work "The European Dreamâ. He is a first rate author and intellectual.
In 1995, a book was published, "The End of Work" by Jeremy Rifkin, which described in detail the current and future trends in the job market. I recommend reading that book to anyone who wants to understand the current catastrophic job market.
I will quote the following from Jeremy Rifkin's mind-opening book. He wrote in the introduction: "Global unemployment has now reached its highest level since the great depression of the 1930's.
More than 800 million human beings are now unemployed or underemployed in the world. That figure is likely to rise sharply between now and the turn of the century as millions of new entrants into the workforce find themselves without jobs, many victims of a technology revolution that is fast replacing human beings with machines in virtually every sector and industry of the global economy.
"...In the past, when new technologies have replaced workers in a given sector, new sectors have always emerged to absorb the displaced laborers. Today, all three of the traditional sectors of the economyâagriculture, manufacturing, and servicesâare experiencing technological displacement, forcing millions onto the unemployment rolls.
The only new sector emerging is the knowledge sector, made up of a small elite of entrepreneurs, scientists, technicians, computer programmers, professional educators and consultants. While this sector is growing, it is not expected to absorb more than a fraction of the hundreds of millions who will be eliminated in the next several decades in the wake of revolutionary advances in the information and communications sciences.
"...Now, for the first time, human labor is being systematically eliminated from the production process. ...Substituting software for employees...To begin with, more than 75 percent of the labor force in most industrial nations engage in work that is little more than simple repetitive tasks. Automated machinery, robots, and increasingly sophisticated computers can perform many if not most of these jobs. In the United States alone, that means that in the years ahead more than 90 million jobs in the labor force of 124 million are potentially vulnerable to replacement by machines. With current surveys showing that less than 5 percent of companies around the world have even begun to make the transition to the new machine culture, massive unemployment of the kind never before experienced seems all but inevitable in the coming decades.
"...A study was published in 1989 by the International Metalworkers Federation in Geneva forecasting that within thirty years (by the year 2019), as little as 2 percent of the world's current labor force will be needed to produce all the goods necessary for total demand." I want to remind you that it is 2 percent of today's world labor force and not 2 percent of the world labor force in 2019, which could have many more millions of people.
*******
SouthAmerica: I want to remind you that between 1998 and 2003 the 20 major economies in the world eliminated 22 million manufacturing jobs and during the same period they increased production by 30 percent.
Around the year 2000 GM or Ford, I donât remember which car company, build in Brazil the most modern factory in the world â because at the time the Brazilian auto market had one of the best potential for growth compared with the other countries in the world including the US. I remember reading that this new factory that they had just finished building in Sao Paulo, Brazil was the state-of-art in production technology for GM or Ford. And the article went on to saying that a similar factory in Detroit with a similar annual production of cars employed over 3,000 people at the time â and this Brazilian factory with the same annual production had only a total of 89 employees. And that was over 5 years ago.
I remember reading on our local paper in New Jersey around 6 years ago about a company that produced âfrozen Pizzaâ in our area for national distribution â the company closed to install the new machines for pizza production â at the same time they laid off 50 percent of the employees â and with the new machines the company increased production by 300 percent compared with the old system. They did cut the number of employees by half and increased production by 300 percent.
In our area many supermarkets, department stores, Home Depots, gas stations, and so on are eliminating the check out human being, and instead they have machines and people check themselves out by following the instructions on a computer screen.
Basically, you think that all this people will be fully employed by the year 2020 and they will be doing all these manual work, because your mindset is in the past.
I believe we will have major technological advances in the coming years, and they will need less and less people to produce the goods and services around the globe.
.
drsteph : While you might like to think that fully automated production factories are the future, and previously have been, the 'china effect' has introduced a whole new variable - essentially free labor.
***
SouthAmerica: Jeremy Rifkin has been among the most influential authors in the US in the last 20 years. Right now I am reading his latest work "The European Dreamâ. He is a first rate author and intellectual.
In 1995, a book was published, "The End of Work" by Jeremy Rifkin, which described in detail the current and future trends in the job market. I recommend reading that book to anyone who wants to understand the current catastrophic job market.
I will quote the following from Jeremy Rifkin's mind-opening book. He wrote in the introduction: "Global unemployment has now reached its highest level since the great depression of the 1930's.
More than 800 million human beings are now unemployed or underemployed in the world. That figure is likely to rise sharply between now and the turn of the century as millions of new entrants into the workforce find themselves without jobs, many victims of a technology revolution that is fast replacing human beings with machines in virtually every sector and industry of the global economy.
"...In the past, when new technologies have replaced workers in a given sector, new sectors have always emerged to absorb the displaced laborers. Today, all three of the traditional sectors of the economyâagriculture, manufacturing, and servicesâare experiencing technological displacement, forcing millions onto the unemployment rolls.
The only new sector emerging is the knowledge sector, made up of a small elite of entrepreneurs, scientists, technicians, computer programmers, professional educators and consultants. While this sector is growing, it is not expected to absorb more than a fraction of the hundreds of millions who will be eliminated in the next several decades in the wake of revolutionary advances in the information and communications sciences.
"...Now, for the first time, human labor is being systematically eliminated from the production process. ...Substituting software for employees...To begin with, more than 75 percent of the labor force in most industrial nations engage in work that is little more than simple repetitive tasks. Automated machinery, robots, and increasingly sophisticated computers can perform many if not most of these jobs. In the United States alone, that means that in the years ahead more than 90 million jobs in the labor force of 124 million are potentially vulnerable to replacement by machines. With current surveys showing that less than 5 percent of companies around the world have even begun to make the transition to the new machine culture, massive unemployment of the kind never before experienced seems all but inevitable in the coming decades.
"...A study was published in 1989 by the International Metalworkers Federation in Geneva forecasting that within thirty years (by the year 2019), as little as 2 percent of the world's current labor force will be needed to produce all the goods necessary for total demand." I want to remind you that it is 2 percent of today's world labor force and not 2 percent of the world labor force in 2019, which could have many more millions of people.
*******
SouthAmerica: I want to remind you that between 1998 and 2003 the 20 major economies in the world eliminated 22 million manufacturing jobs and during the same period they increased production by 30 percent.
Around the year 2000 GM or Ford, I donât remember which car company, build in Brazil the most modern factory in the world â because at the time the Brazilian auto market had one of the best potential for growth compared with the other countries in the world including the US. I remember reading that this new factory that they had just finished building in Sao Paulo, Brazil was the state-of-art in production technology for GM or Ford. And the article went on to saying that a similar factory in Detroit with a similar annual production of cars employed over 3,000 people at the time â and this Brazilian factory with the same annual production had only a total of 89 employees. And that was over 5 years ago.
I remember reading on our local paper in New Jersey around 6 years ago about a company that produced âfrozen Pizzaâ in our area for national distribution â the company closed to install the new machines for pizza production â at the same time they laid off 50 percent of the employees â and with the new machines the company increased production by 300 percent compared with the old system. They did cut the number of employees by half and increased production by 300 percent.
In our area many supermarkets, department stores, Home Depots, gas stations, and so on are eliminating the check out human being, and instead they have machines and people check themselves out by following the instructions on a computer screen.
Basically, you think that all this people will be fully employed by the year 2020 and they will be doing all these manual work, because your mindset is in the past.
I believe we will have major technological advances in the coming years, and they will need less and less people to produce the goods and services around the globe.
.
Agree. Also agree with china and india vast pool of labor.
And so?
Instead of making shoes, people will have spare time to make research, or work in the service industry. I don't see the problem.
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SouthAmerica: Here is a problem that happened in Brazil that I hope China does not make the same mistake.
In the early 1970âs the major US agricultural machine companies decided to expand their sales in Brazil, and at the same time change the way Brazilians had been doing farming for a long time. The result was an overnight replacement of cheap labor for a mechanized machinery system.
These peasants that worked in the farming system in Brazil, had been in the land one generation after another â suddenly when the farmers changed the system they bought Caterpilar tractors and so on, and told to most of these peasants to live their land. And most peasants had no idea were to go since they had been living all their lives on these farms.
The Brazilian government did not know what to do with these people â they even did not know how many of them were around, since these poor people were illiterate and spent their entire lives working on these farms.
Some genius came up with a solution without testing first if his idea would work out â and the bureaucrats created a program that if you managed to go to the North of Brazil in the Amazon area the Brazilian government would give you a piece of land for you to start your own little farm to help you support yourself and your family.
Most of these displaced farm workers were located in the South were most of the farming were done. The Brazilian government calculated that maybe 500,000 people would manage somehow to show up in the North of Brazil to claim their little piece of land.
They were wrong! More than five million peasants managed to go to the North of Brazil to claim their little piece of land. The only problem is that after all these people moved to that area of the world and started farming it, they found out that the land was not good for farming â the peasants were able to get a little crop in the first year, then after the second year on they had a major reduction in output, and they had to move to a new piece of land and repeat the fiasco all over again. That is part of the problem why they are destroying the Amazon jungle year after year to this day.
But if these peasants were not in the North of Brazil destroying that magnificent Amazon jungle, then what the Brazilian government would do with all these people?
What a government can do to help millions of illiterate peasants that lived all their lives doing manual work in a farm?
Over the years I did read many articles claiming that the Amazon jungle is the lungs of our planet and that 80 percent of the oxygen that human beings need for survival are created in the Amazon jungle.
As the Amazon jungle is destroyed on this consistent manner â eventually that will cause a major problem to everyone living on our planet. â the human-beings in our planet just have to find another source of oxygen. Maybe they will be able to import it from Mars.
Today, more than 70 percent of the population in China - are peasants working on a very old agricultural system. How the Chinese government will deal in the future with 100âs of millions of displaced peasant workers.
.
SouthAmerica: Here is a problem that happened in Brazil that I hope China does not make the same mistake.
In the early 1970âs the major US agricultural machine companies decided to expand their sales in Brazil, and at the same time change the way Brazilians had been doing farming for a long time. The result was an overnight replacement of cheap labor for a mechanized machinery system.
These peasants that worked in the farming system in Brazil, had been in the land one generation after another â suddenly when the farmers changed the system they bought Caterpilar tractors and so on, and told to most of these peasants to live their land. And most peasants had no idea were to go since they had been living all their lives on these farms.
The Brazilian government did not know what to do with these people â they even did not know how many of them were around, since these poor people were illiterate and spent their entire lives working on these farms.
Some genius came up with a solution without testing first if his idea would work out â and the bureaucrats created a program that if you managed to go to the North of Brazil in the Amazon area the Brazilian government would give you a piece of land for you to start your own little farm to help you support yourself and your family.
Most of these displaced farm workers were located in the South were most of the farming were done. The Brazilian government calculated that maybe 500,000 people would manage somehow to show up in the North of Brazil to claim their little piece of land.
They were wrong! More than five million peasants managed to go to the North of Brazil to claim their little piece of land. The only problem is that after all these people moved to that area of the world and started farming it, they found out that the land was not good for farming â the peasants were able to get a little crop in the first year, then after the second year on they had a major reduction in output, and they had to move to a new piece of land and repeat the fiasco all over again. That is part of the problem why they are destroying the Amazon jungle year after year to this day.
But if these peasants were not in the North of Brazil destroying that magnificent Amazon jungle, then what the Brazilian government would do with all these people?
What a government can do to help millions of illiterate peasants that lived all their lives doing manual work in a farm?
Over the years I did read many articles claiming that the Amazon jungle is the lungs of our planet and that 80 percent of the oxygen that human beings need for survival are created in the Amazon jungle.
As the Amazon jungle is destroyed on this consistent manner â eventually that will cause a major problem to everyone living on our planet. â the human-beings in our planet just have to find another source of oxygen. Maybe they will be able to import it from Mars.
Today, more than 70 percent of the population in China - are peasants working on a very old agricultural system. How the Chinese government will deal in the future with 100âs of millions of displaced peasant workers.
.
Mars is well reputed for its oxygen atmosphere ...
