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One seeming inconsistency that stuck out at me is how he criticizes China's lack of free market behavior - he uses the pegging of the RMB to demonstrate this, w

by garply 17y ago

One seeming inconsistency that stuck out at me is how he criticizes China's lack of free market behavior - he uses the pegging of the RMB to demonstrate this, which is definitely valid support for his argument - and simultaneously decries the "slave wages" paid to workers. Claiming the workers are underpaid relative to the USD because of the RMB peg is one thing, but saying that they underpaid relative to their own economy (which is how I interpret "slave wages") is a very different thing. He suggests that the government is the source of these "slave wages". In what way is the government responsible for low wages for uneducated workers when those workers are in competition with many other uneducated workers in a country with a population of ~1.3 billion? Is it so unreasonable that an "auntie" who cleans houses and does laundry for a living is paid about 1.25 USD / hour (approximately the rate here in Beijing) when a low-level analyst at McKinsey here makes 15,000 USD a year? In relative terms, the manual laborer doesn't seem like she's making slave wages to me.

pchristensen 17y ago
He meant it literally - he said you don't have to pay construction workers for the first 6-12 months of a job, and you could fire them before that time without consequences. "If you are building a downtown tower in Shanghai (and there are a lot of them, many empty), you may not have to pay some of your workers for six months to a year. Or you fire them just before that: free labor!"
- SlyShy 17y ago
  Yes, this kind of payment withholding happens to immigrant workers almost always, and to native Chinese workers often. That's not to mention the children and mentally handicapped that are literally sold into slavery. http://www.time.com/time/world/article/0,8599,1635144,00.html http://www.time.com/time/world/article/0,8599,1635144,00.htm...
  - poutine 17y ago
    Almost always? That's a bit of an exaggeration though I don't doubt it does happen. Most Chinese workers do get paid, even the migrant workers. Indeed the laws protecting them are way better than laws in the US, though of course endemic corruption means laws are often ignored. You'd hear about the odd riot here and there where the builders didn't pay in a failed construction project but they'd have a tough time completing a project and not paying anyone. Certainly in any urban area.
poutine 17y ago
Though it's in a bubble, Beijing's current median salary to median house price is 1:27. Normally anything over 1:4 is considered expensive. That analyst will have a hell of a time getting an apartment, nevermind the Ayi (aunt). The Ayi doesn't have much beyond a subsistence living. Needless to say she's probably supported as well by her kids or something, but if not she's in a world of hurt when she's too old to work. I do appreciate why it's used but slave wages is probably the wrong term, the Ayi is working in a market economy that simply has way too many completely unskilled workers for the work needing done.
grandalf 17y ago
China's currency manipulations harms its export industries' profits at the expense of all Chinese consumers.

by garply 17y ago

pchristensen 17y ago

He meant it literally - he said you don't have to pay construction workers for the first 6-12 months of a job, and you could fire them before that time without consequences. "If you are building a downtown tower in Shanghai (and there are a lot of them, many empty), you may not have to pay some of your workers for six months to a year. Or you fire them just before that: free labor!"

SlyShy 17y ago
Yes, this kind of payment withholding happens to immigrant workers almost always, and to native Chinese workers often. That's not to mention the children and mentally handicapped that are literally sold into slavery. http://www.time.com/time/world/article/0,8599,1635144,00.html http://www.time.com/time/world/article/0,8599,1635144,00.htm...
- poutine 17y ago
  Almost always? That's a bit of an exaggeration though I don't doubt it does happen. Most Chinese workers do get paid, even the migrant workers. Indeed the laws protecting them are way better than laws in the US, though of course endemic corruption means laws are often ignored. You'd hear about the odd riot here and there where the builders didn't pay in a failed construction project but they'd have a tough time completing a project and not paying anyone. Certainly in any urban area.

poutine 17y ago

Though it's in a bubble, Beijing's current median salary to median house price is 1:27. Normally anything over 1:4 is considered expensive. That analyst will have a hell of a time getting an apartment, nevermind the Ayi (aunt). The Ayi doesn't have much beyond a subsistence living. Needless to say she's probably supported as well by her kids or something, but if not she's in a world of hurt when she's too old to work. I do appreciate why it's used but slave wages is probably the wrong term, the Ayi is working in a market economy that simply has way too many completely unskilled workers for the work needing done.

grandalf 17y ago

China's currency manipulations harms its export industries' profits at the expense of all Chinese consumers.