Hey, why wasn't China invited to this party?

My company composed 40% of my main supplier’s business.   Our supplier had 2000 employees and was itself a medium sized company approaching $100 million in annual revenue.   But it had a problem:  there were serious restrictions on space within this factory’s industrial area, and as such all factories had growth constraints.  

There was nowhere to build “out”, and the supplier could only build “up”.   He was a stone’s throw from the Shenzhen airport. 

Like all savvy factory owners, this one understood the key to his “success” was his relationship with that class of people that had more power over his destiny, and financial being than Uncle Xi every would:  the local officials.  Not the city….not the county….but the “district”. 

So this factory owner decides he wants to build “up”.   Yet his factory building being only inches from his neighbor that’s not possible, you see.  This particular building height was only at two stories.  Very small indeed and too inefficient a use of proper space.   After a few meals however, and the proper face saving “resistance” given by the official, however, this factory owner got his new floor.

He proudly showed it off to me.  He had clearly violated the district fire codes by adding another floor.  But his business would benefit.  Then I asked him what those “struts” were sticking out at regular intervals above the third floor.  With a wry smile, this dark, short fellow with the rotund face looked up and said, “Those are in case I want to add another floor”.

And that my friends in a nutshell is why China rightfully was not included in the new Transpacific Partnership Trade Agreement. 

Obama, it seems, though he was right to deny China access to this market, all the same flubbed bigtime the reasons for such.  In a timely moment, his eloquence failed him.

Well, Prez…..can I help?  Methinks I can make up for the sudden lack of gab you had yesterday on this very topic.

Not just America, but Japan, Australia, Vietnam, etc etc….none of these countries wanted China to participate.    This would be very much akin to having your child’s football team play grownups.   

China’s pure size and penchant for using its size in a most unenlightened way, ie for its benefit only is plain to see.  Despite what China says to others, it views all competition through the prism of a “zero sum” game.  There can only be winners and losers.  China lacks the subtlety of sometimes seeing things in gray.

Perhaps the best reason for not allowing China to participate, from an American point of view, is little ol’ South Korea. 

Only a couple years after the full implementation of that agreement in 2012, the USA has already lost 60,000 jobs with a 60% jump in the trade deficit.  Simply more proof that “free trade” is nothing but a device for more evenly distributing global wealth at the expense of America and American jobs. 

May I remind you South Korea only has 50 million people with a GDP one ninth of America’s?

What the hell do you think would happen if we all had a free trade agreement with China?

What did Marx say?  Give the capitalists enough rope and they will hang themselves?  Having a free trade agreement with China comes to mind.

As the Chinese themselves will freely admit, Chinese…..well they “cheat”.    But to a Chinese that’s nothing but “good business”.      Chinese will freely admit for many of them the main impetus of fleeing China and going to Africa was (gasp!), there were no Chinese there to compete with.  No one to steal your ideas….or price you out of the market.  No bottom feeders to come along.

It’s bad enough that Chinese look at competition as a zero sum game.  It’s worse when they play the game of capitalism the way it was played in the time of Carnegie, Rockefeller and Morgan.   No rules, no remedies.   When a Chinese business wants to cut its price be careful to understand it does not cut its margins.  Rather it just cuts corners.    And in the name of making a buck what happens?

The environment goes to hell in a handbasket.  As I’ve said before, it’s plain to see….just look at the black skies that once only covered Beijing but even now are drifting south.  That’s what 1920’s Capitalism looks like, folks.  Also known as modern day capitalism with Chinese characteristics.   And that’s only what we can see and measure…..heaven only knows about the soil and water!   Could one even imagine what China would look like if China was part of the TPP?  Rules?  Simple.  Best price wins.

The Chinese People wonder “what went wrong”?  Is this a serious question?  Only Chinese who have never lived overseas can innocently ask that question.   Trust me; we are saving China from itself. 

China says it has met all its free trade obligations.  Really?   Ever tried opening a bank account in 

China with a foreign bank?  I have.  I thought with my HSBC account already established in Hong Kong it would be easy to open one up in Shenzhen…..nope, not a chance.   Let me take that back….it is easy if I happen to have 500,000 rmb lying around.  That’s how much it would cost.   Meanwhile, my wife went out one day and opened up an account at a local Chinese bank for 10 rmb. 

Ever tried to open up a company in China?  How’d it go?   Don’t forget to keep your registration hanging on the wall.  Meanwhile I created a company in both Hong Kong and America in less than a day.  

I had a high profile company visit me at the factory once.  Their legal guys came in.  They bragged that “not even Chinese companies” could escape their grasp.   Than they mentioned it took five years to hunt the guy down and convict him in court.   Do you know how many Long Islands I can drink in 5 years? 

Remind me why we want China in the TPP?

China is still the Wild West and will be for at least the next 50 years.  Except no one carries a 6 shooter.  Everyone has an Uzi.  And the Marshal serves the highest bidder.