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The Chinese government is willing to forgo living wages for its populace, environmental protections, worker safety, etc. As a result, the cost of manufacturing
by Fej 10y ago
The Chinese government is willing to forgo living wages for its populace, environmental protections, worker safety, etc. As a result, the cost of manufacturing is dramatically lower than in developed countries.
For example, a Chinese manufacturer can just dump toxic waste in a pit. A manufacturer in the US has to dispose of waste responsibly. Naturally, this is much more expensive. Those costs are passed on through the supply chain. We want everything impossibly cheap, hence the movement of manufacturing to developing countries.
This, of course, brought tons of manufacturing to China. They have become a world power with a reasonably strong economy. Their leaders don't want to give that up, since if their people demand workers' rights, environmental protections, and so on, manufacturing will just move on to the next developing country in line.
Therefore, they decided to implement harsh censorship, in order to lower the possibility of a revolt.
- criley2 10y agoI mean, that's very 2000. It's 2016 and China's advantages are more moat-based than anything else. Why do we build electronics in China? The labor isn't that much cheaper in 2016 and represents one of the smallest costs in an electronic device. An iPhone breakdown usually lists $200 in parts and labor, with $2 going to Chinese labor. On the flip side, they have a generational moat for electronic manufacturing. You build electronics there because everyone builds electronics there. All the factories and subcontractors are all near by. The system is efficient and cost effective. If you wanted to assemble in America you'd probably still be importing tons of Chinese parts.
- seanmcdirmid 10y agoAssembly happens in China, many of the parts are actually made in South Korea, Taiwan, and Japan. China still isn't great at high value part creation (well, it's more like, no one dares move that tech to China).
- Fej 10y agoWe build electronics there because they have a near monopoly on rare-earths. They use this to keep manufacturing in China. Not long ago there were quotas that limited the amount of rare-earth minerals that could be exported. I expect that as their monopoly on rare-earths slips, electronics manufacturing will move elsewhere, slowly but surely.
- netheril96 10y agoThat is only a small part of it. Most developing countries either sacrifice living wages, environment protections and worker safety deliberately, or have no strong governments to enforce those things, yet few are as successful as China.
- analog31 10y agoI think that "no strong governments" is the key. At the very least, manufacturing business needs strong government in order to maintain reasonable stability. It doesn't necessarily have to be a particularly nice government, though a nice government (at least at some minimal level, not trying to be too optimistic here) may be necessary for a robust consumer market.
- deleted 10y ago[deleted]
- bobjordan 10y agoTry to get a factory approval in China these days for any non-green business and then you will find that actually the government does not condone any of the practices you've listed in your rant.