China as Trading Partner

Many are the comments on the Chinese Trade surplus, this article more reflective than the Norm. China is downplaying its Trade surplus, while developing alternate Trading partners with Third World countries. Study of these Relationships will find China attempting to replace Western technology in the Development policies of these Third World countries, desiring to become the principle Technology supplier for them. Their goal is to get the Western industrialized nations to capitalize this transition, and they have been fairly successful in this endeavor. They hope to utilize the U.S. Debt held by Chinese to counteract any counter-cyclical effort by the industrialized nations to forestall this dominance. Readers may do well to remember that the Chinese have always led the World in negotiating bad faith Agreements, which there was never even any attempt to live up to the terms of the Agreements.

The nature of Chinese politics stands as the major culprit behind this Stance, as it has since the origins of China. China has always been ruled by a Warlord style of Provincial Chief, who has almost unlimited power within his fiefdom, setting and interpreting the laws, but responsible for meeting the goals set by the central throne; this consisting of the entire coalition of Provincial chiefs. All are judged by a very ruthless All, and replaced if there is any failure of Group desires. Provincial chiefs have absolutely no impulse to meet any legal standards–especially legalities established by foreign powers. Laws against intellectual piracy will never be enforced, as it introduces an added Cost as well as slowing the Production function; making it difficult to meet the goals of the congregated Provincial chiefs. Coal is cheap and abundant, while Pollution abatement is extremely expensive and Time-consuming; again making it difficult to meet the national demands of the Provincial chiefs. Product Quality means nothing to Provincial chiefs, unless the Product is designed to be distributed within their own Province. Uniform Business law impedes the control of Provincial chiefs, as well as curtailing the impost of desired levies to defray Provincial expenses. American Business have always believed there was a fortune to be made in China; the problem remains that the Provincial chiefs will never allow such a fortune to leave their own particular Province, let alone China.

One must understand these Provincial chiefs are quite unabashed in their pursuit of their own aims, to the point of arresting foreigners until they have squeezed the Profitability from them of their Chinese Production operations. Foreign Business will still be protesting previous ill-treatment, when they are hit by further discriminatory action from the Provincial chiefs. Chinese businessmen, under the protection of Provincial chiefs, will run up huge debts to Westerners, and claim Bankruptcy under hard pressure; never ceasing their Purchases and extension of financial liabilities to Western suppliers of Capital. Foreigners will file lawsuits, which will get lost in the Chinese courts by order of the Province chiefs; a situation which will either be denied by the national government, or by promising corrective action which is never pursued. What every Westerner needs to understand is that what goes to China, stays in China; it is a Tradition older than Capitalism itself. lgl