I Hear That Train A Comin …

Johnny Cash was the man, as was his classic song, Fulsom Prison, where he sang of a man hearing the train round the bend as he sat in prison for killing a man in Reno and longing for his freedom. An American icon. I listen to some of his music on my I-pod while walking the dog. The Man in Black aside, there are Western outsiders who think various stakeholders in China, including those in government and/or business, can just wave their hands or flap their lips in China and make things/change quickly happen in the place. But let me show you and give you some visual perspective using a train of what it is like to live in a world of 1.3 billion people and try to manage them. (Hat tip to Vicki Walls for sharing this video with me.) Click HERE. Still think China can turn on a dime into a western style democracy, or stop IP violations or become an environmental Sweden overnight? Does this visual picture help you better understand the emphasis on Confucianism and “the group” in China versus “the individual”? (Notice how these passengers act and say nothing/very little as they board the train and they are not getting all up in arms and yelling “hey, buddy, get your g*d**m* hands and body off me!’ as many Americans would do and blow a gasket over.) As we travel in China and India this year, take off your business hat and become a social scientist/anthropologist — look for and study these types of things and try to better understand them (not raise that Western nose up and judge them). It’s gonna be a great trip …

“And I’m stuck in Fulsom prison, and time keeps … draggin’ on.  And that train keeps a mooovin’ … dooowwwwn to San Anton’ ….” - Johnny C.

3 comments May 8th, 2008

Required Assignment: Human Rights, Part II, Due Friday, May 23, by 5:00 PM

I enjoyed reading your definitions of and perspectives at the post, Human Rights Part I. Given recent events in China, and, the fact that the Olympics and related protests are heating up, we have been given a golden opportunity to study and debate this issue.

This follow up assignment is due in the form of a 1 page (max) memo, and is due no later than Friday, May 23 at 5:00 pm.

Your comment below, and any follow up comments you make below do not count as part of your required quarterly blog comments as discussed in the syllabus.

I again publicly thank John Wu, Lonnie Hodge and David DeGeest for their input and comments on this post. Any errors in the below are solely my own and my responsibility.

Below is an excerpt from John Bryan Starr’s book, Understanding China: A Guide To Understanding China’s Economy, History and Political Culture (pp. 211-219) that I sometimes assign as a foundational piece to get people started thinking about this issue. What I like about his summary is that it nicely captures the main points without taking hundreds of pages to do it. In his excerpt below I have taken the liberty to work in some of my own thoughts and edits, where relevant, as well as some of the comments from my colleagues listed above, to make it more applicable to this course and trip. But I expressly give credit Mr. Starr — much of the below work, writing and ideas are his work, not mine.

I appreciate that someone with an agenda on either side of the human rights debate can easily go through the below, skewer it, and offer selected example(s) to contradict or support below said statement(s).

Have at it. I have no beef with that, nor do I hold out the below as absolute truths for all people in every situation; but rather, general background commentary that most reasonable, balanced, pragmatic, critically thinking, life experienced, and well-traveled people in the bell curve (not the outliers) would not fight to the death over.

Here we go:

As a starting point, you might review the Universal Declaration of Human Rights that was ratified by the United Nations General Assembly in 1948.

There are strengths and weaknesses to this Declaration. One problem I have with it is that it is so broad and expansive that when I read over it I am left thinking, “Geez. Is there anything that these do-gooders did not throw in as a ‘right’ of each and every human?” I felt much the same way with how several of you defined human rights in Part I — your definition was so broad that it would be difficult to apply to real world situations.

If one searches, they can find other declarations and definitions of human rights that are more expansive or more restrictive that the UN Declaration. What I have found to be more helpful in studying this issue is to focus on the categories of human rights that a comprehensive definition of the term is thought to encompass. That is, economic, social, political and civil categories or rights.

Economic rights protect the individual’s access to sustenance and participation in the workforce.

Social rights guarantee access to goods and services provided by the state, such as education, social security and health care.

Political rights guarantee the individual’s ability to participate in the political process.

Civil rights protect the individual from illegitimate interference by other individuals or by the state.

An assessment of the level of human rights in all four of these categories reveals both positive and negative results in both China. Ironically, in China, economic reforms and development have expanded human rights in some areas, but restricted them in others.

Economic Rights

With respect to economic rights, China points with pride to its accomplishments of the state in extending the right of sustenance to the entire population. With the exception of the period following the Great Leap Forward, when many Chinese starved to death and hunger was widespread, China has managed to avoid the devastating famines of the past. Food output has increased, their distribution systems have improved, and public-works-projects have reduced the destructive effects of natural disasters. There have been considerable advances in emergency relief in China — the Yangtze river regularly floods in the spring, and China frequently deals with Katrina-level disasters with a startling amount of efficiency and care for human lives. Clearly, Deng Xiaoping’s Reform and Opening Up policies have made a positive difference for many Chinese. Studies differ but the numbers range from 200 million to 400 million (this latter number is more than the entire US population) who have been lifted out of abject poverty in China due to these reforms.

On the down side, while economic reform has both advanced the access to sustenance by enhancing productivity, it has also jeopardized its future by failing to limit population growth and reduced the amount of land under cultivation in China. Further, prior to China’s economic reforms, started several decades ago, most people had employment for life (I used to think this was a good thing until I ran my own business, became involved in management and I witnessed how this motivates (or not) performance). As China shifted to a “socialist market economy” the days of the “Iron Rice Bowl” and guaranteed lifetime employment are over. As the collectives have died, so have the medical and social protections essential to everyday living. Further, property seizures by the government for eminent domain purposes have been on the rise the past decade. Also, unknown to many Americans (and Chinese) is the 18,000 annual documented social uprisings to protest a variety of government activities. All of this will be pivotal and get more attention as the Internet spreads and 3-G becomes available in China.

Social Rights

With respect to social rights, the achievements of the Chinese Communist government were impressive during its first 50 years in power. For example, in 1949, less than 50 percent of China’s elementary school age children were in school. Fifty years later, this figure rose to 97 percent, although the quality of said education, with one can argue that its emphasis on memorization, is suspect. The early numbers for college education have gone from 2-3 percent (mostly boys) to 40 and 50 percent — this is a tremendous accomplishment. In 1949, there was one doctor for every 1,500 people and one hospital bed for every 7,000 people. By 1999, these figures had increased to one doctor for every 650 people and one hospital bed for every 380 people. But again, the quality of said medical care is hit and miss (as is access due the fact that a number of hospitals in China now require you to pay up front for their services; but this is also becoming a problem in the US — see this recent WSJ article, Cash Before Chemo; US Hospitals Get Tough). Similarly, 1n 1999 about one of every five members or the workforce had access to some form of state-provided retirement plan. The economic reforms noted above have had mixed effects on the state’s ability to guarantee these social rights, particularly to rural citizens. The household responsibility system in China has also led to an increase in the number of children leaving school before graduation, since the system’s incentives encourages parents to make their children work in the fields or local factories as soon as they are old enough. As for social security, clearly, in recent years the shrinking state sector has reduced the number proportion of workers with access to state funded pensions.

Political Rights

China’s record for political rights is somewhat different. While the right to participate in the political process is widespread, that participation is generally devoid of significance. Elections are regularly held for executive and legislative posts, but, until recently, usually never with more than a single candidate for each post, a candidate selected and vetted by the CCP. Since the 1980s, a democratization of politics as we (the West) generally view it has occurred at the local levels, where several candidates run for office, and it is by no means the CCP endorsed candidate who wins (however, see this recent People’s Daily article that highlights how more and more non-CCP members are being tapped for top posts in the government) . (By the way, the Chinese will counter that our current state department (i.e., Condi Rice and crew) is now a politically controlled police agency, our judicial branch controlled by the ruling party, and that our current president was elected on the basis of a conservative Supreme Court who themselves became “judicial activists” to determine the election — folks, don’t shoot the messenger.)

Important note: for a recent CCTV segment I watched that peels off deeper and different layers of the above statement re: the import of these local elections for political rights and the development of Western style democarcy, click HERE to watch this very interesting and thoughtful 17 minute CCTV segment, where the China Law Blog’s lawyer extraordinare Steve Dickinson appears. CCTV is considered by most to be the English speaking mouthpiece for the CCP, but in this segment, I did not see that this was much of an issue. Also while this segment is not the finale of Survivor or Desperate Housewives, it is really quite good. Steve does an excellent job offering a thoughtful analysis, he holds his ground against the other fellow and show’s moderator, and, he conducts himself with professionalism and like a gentleman.

Civil Rights

Civil rights, the area where most Americans focus, is a debate that is difficult for the Chinese to understand. Asked whether their lives are subject to more or less government interference than they were fifteen years ago, the majority of Chinese would likely respond that they are significantly more free (you can verify this when we go to English Corner). Today they can speak freely and critically about political issues, and they are able to hear a reasonably broad range of information and opinions, and make decisions about their places of residence, careers and leisure that were formerly made for them. But this expansion of civil rights is less the intended consequence of CCP policy than the unintended consequence of the weakening of the party and government influence in recent years and the intervention of technology (e.g., fax machines, satellite dish, cell phones, the Internet, etc.).

While Chinese can speak freely and critically about a broad range of political issues, their is little dispute that they must be careful how and when they do so when said speech is coupled with what we label in the U.S. Constitution as freedom of association — e.g., a group or people meeting in person or on-line, and any kind of a celebration on campuses or bulletin boards critical of governmental policies are shut down. It is not uncommon for the CCP to take heavy handed action against group activity and group speech when it’s political power is being challenged by the discussion and activity. Part of this societal trepidation toward the threat that groups can pose, particularly by the older generation in China, can also be traced back to the days of the Cultural Revolution, where a number of these individuals found themselves attacked and/or under suspicion from the infamous Red Guards that roamed the cities and countryside of China persecuting scores of people. As an example, the father-in-law of one of my listed colleagues above spent six years in a re-education camp because he had been an officer of Mao’s and therefore had been given too much privilege and needed to be “reformed.” Also keep in mind that part of the desire for cohesion and stability in China is driven by its past often violent history and the identity of some of its neighbors. Think of the countries that border China who might be classified as threats — Japan, the Koreas, Russia, India, the various Muslim “stans” countries that border China on its western border, Vietnam (who China recently fought a war with and lost), Taiwan, etc. (now, compare and contrast the US — do you feel any threat from Canada, Mexico or Cuba? Right now, our closest geographic military threat may be Venezuela via Mr. Chavez).

Contrary to the assumption of most Westerners, the Chinese are free to practice their religion if said religion or church is a registered and sanctioned one (meaning Catholicism, Protestant, Christianity, Taoism, Buddhism and Islam) and/or its spiritual leaders are favored by Beijing and not Rome in the case of Catholicism (or the Dali Lama). Some point out that if anything, the past few years has seen a resurgence in China of the government’s tolerance of religion because many recognized organized religions tend to preach respect for authority (i.e., the government) and this now plays into to hands of the CCPs’ current strategy of “maintaining harmony in society”. See, e.g., this NY Times Op-Ed piece, How China Got Religion and this recent NY Times video report (Christianity in China) by China hand and famed journalist, Nicholas Kristoff; see also this excellent April 12-13, 2008 Wall Street Journal article that elaborates on the above, In Search of … Something: A Growing Number of Chinese, Ummoored by Rapid Change, are Finding Answers in Religion.

Others contend that the situation is much more bleak on the religion front. For example, they point out that underground churches are routinely destroyed and/or non-state supported religions attacked. See, e.g., this Times Online article on how China “outlaws” reincarnation.

Further, schools have been instructed and taught to identify and remove missionaries posing as English teachers. Note that it is not uncommon for certain churches to send missionaries to China under the guise that they will be “teaching English” when the true primary aim is to proselytize (see, e.g., this recent SLO New Times article about one of our local citizens who went on a Mormon mission to the PRC). Some Chinese will point out, with heavy sarcasm, that Jesus would not have entered China under false pretenses(again, don’t shoot the messenger).

Whatever the current state of affairs re: religion, it is important to note that most inside China agree that said religious activity must ‘render unto Ceasar what is Ceasar’s and not challenge the CCP or its authority. This is perhaps where where Falun Gong went wrong — they did not help their cause when several thousand of them showed up right outside Chinese government offices in Beijing to publicly protest their persecution. Falun Gong is an interesting phenomenon. What originally started as a non-political association that was little more than a practice of a form of tai qi, became political as it amassed a huge following and began representing a threat to the CCP because of its rapidly growing organization, the development of a sophisticated network, and the charisma of its leader. (By the way, few people in/from China have much respect for Falun Gong. See this related NY Times article that reports a number of Chinese walked out of a show at Radio City Music Hall in New York due to its not to subtle Falun Gong outreach attempt).

As a comparative benchmark, it would be a mistake for Americans to assume that no tension and/or persecution exists in the US between the government and organized religion. For example, in recent years the U.S. Supreme Court has routinely taken, heard and decided cases on the issue of church-state separation that did not side with the church. As a further compare and contrast point, today’s churches who run afoul of ‘rendering unto Ceasar what is Ceasar’s’ are sometimes seen as running more of a business rather than a charity, and the IRS has responded accordingly (see, e.g., this Wall Street Journal article, A Taxing Issue: What to Render Unto Whom?). Also, if, in the US, a preacher or church endorses or promotes a political candidates from the pulpit, and they violate the ‘render unto Ceasar what is Ceasar’ maxim noted above that China also takes quite seriously, they too are in serious danger of losing their tax exempt status as a non-profit (see this recent Wall Street Journal article re the Obama camp and his outspoken pastor). Thus, while some would say this is not a direct frontal assault from the government, these are examples of where a church will be hit with a consequence that will effectively put them and their congregation out of the religion business overnight because they will now have to pay taxes on income like everybody else and the vast majority of churches cannot withstand such a financial blow.

It is also interesting to note that with respect to the civil rights component that makes up human rights, the Chinese do not talk just about ‘rights’, but also ‘responsibilities’. In Imperial China, the concept of individual rights did not exist. Confucian ideology emphasized social relationships that created duties, not right. Examples of such expected responsibilities include the priority of family, society and nation, over the individual.

How often do you hear of people in the West speak of their responsibilities? In fact, we often see the contrary — see/refer to this recent March 30, 2008 SLO Telegram Tribune article advocating for an “outdoor children’s bill of rights”, and my previous blog post on Millennials)

Relatedly, if you follow China regularly you will hear much use of the word “harmony,” as in creating a “harmonized China” where multiple ethnic groups and others are able to exist in one, unified China. China has 56 different ethnic groups (that is not a typo) that are able to live in China in relative piece, and these different ethnic groups suffer none of the express or hidden prejudice seen in the US and the treatment of native peoples and long-standing ethnic minorities (German, Irish, Japanese, Chinese, French, and others). While in the US we often talk about civil rights for minorities in the US for women, African-Americans, Native Americans, gays, etc.; most that have lived in the US and China agree that in China these 56 minorities enjoy a freedom and equality in China that rivals what is available in the US.

American human rights groups and the U.S. Congress have been interested less in the rapid expansion of civil rights for the majority of Chinese people than in the very serious violation of a small minority of civil rights, the individuals who have been imprisoned or sentenced to reform through labor for their dissident political or religious views. In China, a country of 1.3 billion plus people, approximately 1.5 million people are behind bars. A significant number are also believe to be in labor reform camps. It is very difficult to find reliable estimates of the fraction who are imprisoned for political crimes. Note that as of 2006, in the United States, with its 330 million plus people, roughly 7 million people are behind bars, on probation or on parole; and of this total, roughly 2.2 million are incarcerated. The United States has the highest incarceration rate in the world, with African Americans comprising a grossly disproportionate percentage of this number. China is second. Russia comes in third with 870,000 incarcerated people.

The Chinese government says that it is holding two thousand political prisoners, but that number does not include those in labor reform camps. Those who survive their stay in labor reform camps often report that they conditions were severe and that they were treated harshly (the Chinese will counter with Guantanamo and Iraq). Harry Wu, the famous Chinese political activist and dissident who was imprisoned in a Chinese labor camp for a number of years, argues that the number of people held in labor camps is much larger than the government number, but his numbers in this regard have been questioned in recent years (the Chinese will also argue how gullible we are by pointing out that the war with Iraq was initially and primarily based on the crack-pot claim of weapons of mass destruction).

Reflection

There are several points worth reflecting on as we consider what Americans can or should to do bring about an improvement in our read and interpretation of China’s human-rights record.

The first has to do with our assumption about the universality of our views on human rights, our notion that they are appropriate standards for all societies to adopt, regardless of their possible disjunction with other traditions and cultures. Related to this point is the following story passed along by one of the colleagues I note above:

Chris — I recently had a discussion with a fellow alumnus from my university and who is also a PRC citizen about voting. This young Chinese man is a believer in the Republic of China (Sun Yat Sen, the founder of modern day China’s, organization), and wants to see the republic restored. This Chinese fellow is progressive and radical by Chinese standards and might even be in danger were he to voice his ideas in the PRC. He is a believer in democracy. However, we had a long and serious discussion about the creation of a voting test to be used in China. Naturally, I talked with him about Jim Crow and the serious problems Americans have with this idea, and he insisted that it would be quite a natural and responsible thing to do in China. This is because people would happily agree to a voting test to ensure that only reasonably educated, informed individuals were voting. They would have no interest in having something similar to the 2000 US election occur in their country, nor are they interested in granting power to a large body of individuals who cannot make informed decisions about the country’s political development. He compared his system to the ancient Greek democracies, where only a small and capable group of leaders were able to democratically elect leaders. And I then realized that that the PRC fellow was probably right: Chinese citizens would probably prefer to have a voting test to ensure that a demagogue with the ability to manipulate the hundreds of millions of relatively uneducated peasants would not be able to take power. This conversation drove home to me that historical precedents radically inform our understanding of “universal human rights.” US citizens see voting test and think about Jim Crow; PRC citizens see a voting test and think of the Confucian values of examinations that demonstrate political acumen.

The second point relates to Chinese rejoinders to American complaints about their human-rights violations. In looking at conditions in another country, Americans often measure real conditions abroad from an idealized vision of conditions at home, and thus seem blind to violations of human rights in their own society at the same time they ferret out evidence of violations elsewhere.

While PRC citizens often have difficult access to balanced world news (e.g., one of my listed colleague’s above notes that his Chinese students famously had no idea that Pope John Paul had died), many Americans with an education remain willfully stupid of world events (e.g., how many Americans did you run into that did not know that Benazir Bhutto was assassinated or who she was?).

A third point to keep in mind is that in asking China’s leaders to allow dissidents freedom of movement and expression, we are asking them to do the very thing they are least likely now to do willingly. China’s leaders understand the Party’s weaknesses and are well aware of the many sources of dissatisfaction within Chinese society. And they often say, political instability threatens the nation’s continued economic development; more, it threatens the leaders’ own power, position and perks. Under these circumstances, they would regard giving free rights to dissidents as an act of national betrayal and political suicide. Note that there are number of Sinologists who believe that China does not need to democratize to continue to grow as it is growing. E.g., click HERE.

The fourth point relates to the issue of sovereignty. As Dr. Morris highlighted in his history lecture, rightly or wrongly the Chinese interpret the history of their interaction with the outside world during the nineteenth century as a long series of painful episodes of national humiliation in which foreign powers constantly trampled on China’s sovereignty. “Ours will not longer be a nation subject to insult and humiliation. We have stood up,” were the words that Chairman Mao chose to market the founding of the PRC in 1949. Their position in this regard may not be irrational. Imagine the reaction of the American government were the Chinese to make continued American investment in joint ventures in China contingent on the U.S. Congress’ strengthening of affirmative action programs or complete, full and market rate reparations for Native Americans or African-Americans, for example.

The fifth point has to do with tactics. Americans are often not aware that when dealing with Chinese officialdom we need to consider doing so in a way that minimizes the potential for losing face. This is problematic, for very often US government actions are effective in the American political context only if they are carried out in a high-profile and public manner. Open up the paper and you can see daily examples of this on both sides of the political aisle (e.g., can you spell N-A-N-C-Y-P-E-L-O-S-I, or, T-R-E-N-T-L-O-T-T?). Further, think of how American politicians often seek to link Chinese access to the American market to human rights (e.g., Most Favored Nation trading status, Chinese entry into the WTO, getting the Olympics, etc.). Yet, there continues to be fierce debate whether using trade sanctions (or boycotting the Olympic Opening Ceremony) to promote greater attention to human rights in China is counter productive.

(As an aside, one of my colleagues above has worked with Olympic athletes and he raised the following point that I had not thought about — have you given thought to the destruction of careers and lives that accompany the boycotting the Olympics should countries start deciding to go there (and not boycott only the Opening Ceremonies)? The toll on the athlete who has trained his/her entire life for that one shot at greatness? Is human rights the burden of the athletically gifted, and if so, why? Nic Marlin, what say you?)

For example, trade sanctions cannot be crafted in such a way as to hurt those in the CCP for the violation of the civil rights of dissidents and cannot avoid penalizing the very sectors of Chinese society that are most receptive to the very ideas we may want to promote. Sanctions can also reduce contact with the outside world, through which some Chinese have begun to become familiar with the rights of citizens in other countries, and, armed with this new knowledge, to press their own government to guarantee them the same rights. Some argue that constraining that contact may reverse that process and the political liberalization that is already under way that has significantly expanded the freedoms enjoyed by the majority of Chinese citizens. Further, some NGOs (e.g., Heartland) openly require the “democratic proliferation of ideas” as a condition of funding for human rights initiatives. People often ignore or underplay the enormity of the reforms China is pursing as part of its attempt to modernize. See, e.g., Randall Perenbooms’ China Modernizes.

As an aside, when CNOOC (Chinese state owned firm) made a bid for Unocal (American owned energy firm) several years back, but their bid was beaten back by American politics, protectionism and xenophobia, Yang Hua, CNOOC’s chief financial officer said the use of political prejudice to deny access to the energy it needed amounted to a violation of human rights. “What are human rights?” he asked at a news conference in Hong Kong. “I’ll tell you what it means. For us it means guaranteed access to the energy we need to become a modernized country.” You can agree or disagree with this fellow, but the interesting point is that some Chinese see access to energy as a human rights issue.

The sixth point is that for better or worse, rightly or wrongly, your own United States government recently dropped China from its list of “worst” human rights violators. See the NY Times article by clicking HERE. On the other hand, moving from “worst” to “bad” is not a terribly effective marketing pitch.

Seventh, re: T1b*t (hereinafter “T”), which is currently a hot, emotional topic that I suspect some will raise and focus on. Look, I am no T expert. None of us on this campus are. The only thing I can conclude in my own mind is that it’s a crazy mess (which statisticians call an outlier). The best I can offer to help deepen your understanding of the T issue is to refer you to what I consider the be the best piece I have ever read on T that helped me better understand what has happened and what is happening there. It was a three part series by Peter Hessler that appeared several years ago in The Atlantic.

Peter Hessler is, in my view, one of the best writers I know, and he sees things about China that others can only dream of noticing. He is also the famed author of River Town: Two Years on the Yangtze and Oracle Bones: A Journey Between China’s Past and Present. (River Town is without question one of my favorite books on China.)

Click below to read Hessler’s take on T. Are the Han Chinese in T ideological missionaries or progress who are to be commended for their work, or, are they agents of cultural imperialism? He argues, they are inescapably both.

Part I, Part II, Part III. See also this related NY Times, article, Chinese Students in U.S.Fight View of Their Home.

Finally, in life, you will encounter many ‘business bashers” and/or people that thrive on either of the extreme side of the business and human rights debate. My hope in making these posts is that you now better understand and appreciate the human rights issue, how it relates to business, and how complex it can be if you study it at more than a superficial level.

Your Assignment

You work for Coca-Cola. You firm is a major sponsor of the Beijing Olympics. You are the heads of the firms public and governmental relations unit. China is a market your firm must have and be a player in for your long-term survival. Coca-Cola is bullish about China. No serious, credible, global businessperson disputes that fact. In fact, you have been in the China market off and on since the 1920s. Protests against your firm inside the US and elsewhere for doing business with the CCP Chinese regime and in a country that some contend violates “human rights” have been heating up. Conversely, you are getting hit from protesters on the other side of the coin — you are finding that if you do not back and support the Chinese, the locals there may come out, en masse, to protest against and even boycott you for being “anti-China” and/or wanting to keep China down (see, e.g., the below Carrefour articles). Stated differently, as is often the case in life, no matter what position you take re: China, in today’s political climate, you are damned if you do and damned if you don’t.

Your CEO is getting nervous about how this could all backfire on the company and she is struggling with how to proceed. Your CEO has asked you for a memo, one (1) page max single spaced, that provides a recommendation on how the firm should proceed in response to: (1) protests/boycotts of the firm outside of China that the firm is too “pro-China”; and (2) the protests inside China that Coca-Cola is “anti-China” and not doing enough to recognize China’s economic, social, and political accomplishments the past few decades.

What will you tell your CEO? Below are some articles to help you get started. Your CEO is a busy person. She does not have the time or desire to read anything from you that is more than 1 a page, so get to the point. Devote 1/2 page, max, to each the above questions and how to deal with them.

If, in examining your conscience, you find you cannot support your firm’s continued sponsorship of the Olympics and doing business in/with China, and you conclude that you must resign, no problem. You should instead write your resignation letter as your required comment. What should a good resignation letter do and say? What will yours say?

China Public Relations, The Image Thief Primer, China Law Blog, May 2, 2008

Olympic Marketers Seek to Dodge Politics, WSJ, March 20, 2008s

Coke Scales Back its Japan Torch Relay Plan, WSJ, April 19, 2008

Cheering for China Before the Games Start, WSJ, April 18, 2008

Brand Strategies, WSJ, April 12, 2008

Companies Return Criticism From Dafur Group, NY Times, April 25, 2008

Protests of the West Spread in China, NY Times, April 21, 2008

France Tries to Limit Olympics Fallout, NY Times, April 22, 2008

Protesters Confront American Outside French Carrefour Store in China, NY Times, April 23, 2008

French Firms Lower Profiles in China Amid Calls for Boycott, WSJ, April 29, 2008

Anti-French Boycott Falters in China, NY Times, May 2, 2008

***I will take you to a Carre Four for shopping and to study how their model differs from Wal-Mart.

I am not looking for a dissertation. Something along the lines of page of a 1 page total max, concise, well-written piece, with no typos. This is not an arms race — don’t read other people’s comments and feel that you cannot disagree, agree, or that have to come up with something that is “better and more insightful” or “different” than what they wrote. Stop comparing yourself to others, focus on your task at hand and take care of your own business, do you own thinking, and say what you need to say in a way that you can look back on in a year or two and re-read and be proud of.

Good luck.

10 comments May 5th, 2008

Consumer Electronics

Submitted By: David Zarcone

When it comes to consumer electronics, prices only seem to go up when a new technology is revealed or next-generation products are introduced. However, consumer electronics (CE) will be going up across the board this year. What’s the reason for the price increase? CHINA! Click here to find the Yahoo! article.

Numerous factors are contributing to this incredible increase, according to well-placed sources, including the rise in manufacturing and material costs. At the moment, China is the production center for the majority of CE partly due to the cheap cost of labor. But this might be coming to an end; China is bettering its relationships with workers by introducing new labor and protection laws which in turn pushed labor costs up 15%. On another note, one thing to blame is the Olympics. Many factories are shutting down in June to help clear the air pollution. Additional reasons include higher oil prices affecting shipments to the US, factory relocation in China from south to north, and finally, the biggest reason of all: the falling US dollar.

The US dollar just isn’t what it used to be, and the exchange rate between the US dollar and the Chinese Yuan has gone down since the beginning of the year. It has fallen about 10% in the last year, so basically Chinese companies now earn 10% less than they did a year ago due to falling exchange rate.

When asked about this problem and ideas of possible alternatives, a US manufacturing executive said “Some have mentioned Vietnam, but we are talking about consumer electronics. China has the infrastructure. There really isn’t an alternative.” At the manufacturer’s level, prices in China are up 8-20%, and the US retail prices will follow shortly, so stock up on your new cell phones and laptops before it’s too late.

4 comments May 4th, 2008

‘Yeah, Carr, This Trip Is Great And Everything, And I’m Looking Forward To It And I Am Glad Cal Poly Does This, But It Won’t Really Impact My Future That Much As I’m Not Going To Work International’

Oh really?

And let me guess … all the products you buy are made in America and there is no value in seeing where the products we buy are made, right? Or the investment funds your stock broker dumps your money into will have no cross-border asset investments tied to China or India, right?

Hmmmm.

In any event, I think most folks get it, but I do overhear this comment a few times each year. In fact, a few weeks ago I had someone in my office making the very argument that is the heading of this post and that if they had to go on the trip and “bear” it in order to graduate on an accelerated basis, they would buck up and make it through.

Double-hmmmm.

I understand where people are coming from and they mean well when they make such statements, and I am pleased they remain outward looking enough to still enroll in the course and undertake this field trip. Perhaps what they are really saying is, “I have no desire to be an expat.”

Fair enough, as the expat life is not for everybody. But I still push back against said statements, and will continue to do so, because I think said statements miss an important point and shows a disconnect with what is happening in the world and about what the term “international” means in the year 2008.

To reiterate what I noted in our early informations sessions — the goal of the trip is to not turn you into an expat, although that may be the natural result of this experience for some.

Rather, some of the main goals are:

1. To better understand how the world’s business, economic, political and social puzzle fit together. You can’t do that from a book or by having coffee at Starbucks in SLO town, LA or the SF Bay area.

2. To better understand how, even if you/your firm elects to focus inward and continue to emphasize only California or US markets, there is a high probability your competition will use and leverage China and/or India against you. Thus, if you remain on the sideline, in time, your competition will kick your butt, there, or here. For every person who has made the above statement, I can point to one of their competitors who are somehow leveraging China or India to their detriment.

3. This is a big one. You can/will return to the US and … surprise! … you will be better at your business here at home because you traveled to places like India and China to study business, to see what is happening there first hand which will in turn help you separate fact from urban legend, and you gain a deeper understanding of why. If you really pay attention and ask lots of questions and go into both countries with total humility (meaning let them do the talking and you just listen), you might even pick up some best business practices from the Chinese or Indians.

4. How do you know the day won’t come where your boss walks in your office and says, “I need you to take the next red-eye to Guangzhou or New Delhi” and he/she picked you because he/she heard you have been to one of these places before on business? Will you jump at the chance and opportunity of a lifetime and in turn become the firm resident expert on China or India, or, will you run for the hills and miss an opportunity that may never come your way again?

5. Finally, one day you might decide you hate your job and working for “the man” and decide to start your own business. You will need capital to do that. You will find that if your idea is decent, potential investors will look at your business plan and ask, “why is there nothing global or relating to global expansion or strategy or how to respond to the global competition here?”

So, I could go on, but in summary, read this post, “Top Ten Reasons Why China Matters To You” from pundit Thomas Barnett. He says it better than I ever could (or have tried).

His list highlights why in the year 2008, an educated person cannot convincingly argue, “I am not international” or “I am not going to work international.” If you make such a statement, be aware that there are a number of people in the world that will look at you askance and even question your Cal Poly degree and/or what you learned here (as an undergrad or grad student). At least I would ….

To close, here is a great quote from Coca-Cola’s current CEO, E. Neville Isdell (Biz Ed, May/June 2008, pages 19-20):

Question by interviewer: If you were to come into a business classroom for a day, what would you want to say to business students?

Answer: I would want to teach students to understand different backgrounds, cultures, religions, and perspectives, even if those perspectives are antithetical to their own. If student’s don’t listen to and understand other people’s points of view, it creates misinterpretation and confrontation. It certainly will cause them to lose business opportunities. They should never give up their own principles, but they need to be able to find common ground. It’s what all good business leaders do to move business forward. Its’ what all good negotiators do to come to solutions.

Prof. Carr May 5, 2008 addendum: See this related article that just appeared in the NY Times, In Inner Mongolia, Pushing Architecture’s Outer Limits. The money quote in the article:

Indeed, Mr. Ai said, pointing to the architects who had traveled thousands of miles looking for work - “These days, it’s the architects, dressed in black, who are the tribe of nomads.”

6 comments May 1st, 2008

Incoming!!

A really good article in yesterday’s NY Times titled, Chinese Students in U.S. Fight View of Their Home.

You need to read this article, not with the assignment of agreeing or disagreeing with the activity in question, but because an educated person digs deeper and always asks the “why?” to try to get at the root cause behind such human behavior.

Reading this article will also help you better understand a cultural difference and way of looking at the world that is different from ours. For that quiet student from China who sat in the front or back row in one of your undergraduate or graduate courses, and you made the mistake of not reaching out to him/her, this article gives you some insight as to how he/she may have had to bite their tongue as current events came up and were being discussed in their American college or graduate school classroom.

This article also dovetails nicely into Dr. Morris’ excellent session on Chinese history with you in the Fall.

It also directly ties into the following book you will enjoy and might read for your Spring quarter book review by Hanes and Sanello, The Opium Wars: The Addiction of One Empire and the Corruption of Another (2004). Said book points out that these two wars (which the Chinese resoundingly lost) and the opium/drug running trade by the British in China (how many of you knew the British were once major drug runners who made today’s Columbian drug cartel look like lemonade stand pharmacists?), continue to have geopolitical reverberations for all of us, well over 150 years later. Part of what we see spilling out in classrooms such as the USC classroom described in the above article harken back to what happened in China between roughly 1830 and 1860.

You now have built up a base and learned enough about China in this course (or should have) so that you can start to connect the dots like the one I note above.

And watch out for those incoming water bottles.

6 comments April 30th, 2008

More Good Pics From Tom Stader and The Library Project

Click HERE (and scroll down a bit) to check out the latest delivery Tom and his crew made to a school in the An Hui Province in China. The kids in their band uniforms are priceless.

Add comment April 29th, 2008

Dry Cleaning Is Killing My Pocketbook

Not to sound like an oldie, but I remember the day when I could get my dress shirts washed, pressed and medium starch put on them here in the US for 80 cents per shirt.

Today I picked up my laundry, and it was a mere $3.00 per shirt (definitely not the price I could get in China). I asked my dry cleaner about this April 27, 2008 NY Times article, Dry Cleaners Feel an Ill Wind From China, and whether the activity noted in the article (last month a federal tariff was placed on the importation of wire hangers from China) impacted pricing here in SLO town. She responded, “Yes, of course.”

To those wire hanger protectionists/industry that claim to be good ol’ American capitalists that welcome competition, yet sprint to Washington or Sacramento begging to tax imports from other countries in order to protect their domestic products every time somebody makes them compete on the world stage … you are girlie-men for making my dry cleaning bill higher than it needs to be.

1 comment April 28th, 2008

China’s and India’s Challenge to Italy, Detroit, Eric K. and ….

This is a follow-up to my previous post on getting a suit made in China — Baby, If You Look Good, You Play Good.

Check out this recent March 29, 2008  WSJ article that points out that while high-end Chinese made suits may not yet fully be at the level of high-end Italian made suits, the gap has closed.

This is an example of how Westerners can/will sit back with the status quo, “God, we are good. There is no way the Chinese (or Indians) can touch us or our products or processing.” And then they wake up one day, find that the Chinese are making high end suits that can compete, and the next day other high end items such as computers, cars and the like. If you have been monitoring recent moves by the CCP Government (e.g., click HERE and check out this recent China Law Blog post), the government has made it clear that they will make things easy for firms that seek to move up the manufacturing value chain, while for those who wish to continue to focus on low end goods such as textiles and rubber duckies things will only become more difficult in terms of tax breaks, allowed FDI investment, etc.

Or, if you are a Brit, you might wake up one day and your former colonies, first the US (Ford Motor Co.) and then India, now own your once crown jewel known as Jaguar and Range Rover. Oh, wait, that already happened. Click HERE to read about what many thought was impossible for something like this to occur. Good for India.

I am not saying will all happen tomorrow, but I am saying over time, it will happen more and more and more. The lesson is that those in business who rest on their laurels and own beliefs of infallibility and talent, will die.

Eric K., you are right (for now) in your post, “Would Your Drive This?” … China now makes crappy cars and nobody here will touch them, but I think you would be remiss to assume that China will always be making crappy cars and/or components.

For example, you may be too young to remember this, but not too long ago most Americans scoffed at goods coming from Hong Kong, South Korea, Japan and Taiwan (now they come from China; those other listed countries have moved up the production value chain and if/when you visit them you will see this immediately upon getting off the plane). Now, a number of firms in those listed countries make products that are quite good and people from those same American industries that scoffed are like boxers who have had their butts kicked in the ring and are standing around asking, “What just happened?” I see no reason why that pattern will not repeat itself in China.

Another thing to think about — what business opportunities does a car market in its infancy in a country such as China present to foreign and domestic firms?

For example, nobody can stop the Chinese from wanting their own car (materialism is by no means a foreign concept), and if anyone wants to sell cars in said market they will have to take their lower per capita income into account and be able to sell a car that is much cheaper than what is sold in the West. Further, with the CCP government leaning on said industry, the pressure will really be on to create and produce a lot of cars that are more “green” than the current SUVs and big trucks we see driving around the Cal Poly campus, in part because the government simply cannot import enough oil to keep its population driving cars that get only 16-18 MPG and if it wants to survive, it will need to find a way to foster the development of cars that can do better in this regard.

In short, I predict we will therefore see some new and interesting and perhaps even incredible technologies coming out of China (or India) in the auto industry in the next 10 to 20 years that cannot take place in the west due to our lobbyists, unions, special interest groups needing their piece of the pie, the high cost of labor here, etc. I.e., per economic theory, are the rent seekers in the West just too powerful and establish to overcome and implement change and new technologies?

I am not alone in asking this question. Jack Perkowski, an American in the auto parts business in China supplying parts to their domestic industry (not for export) and the author of the very good book that just came out, Managing the Dragon: How I’m Building a Billion-Dollar Business in China, makes this very same point. See also this NY Times piece that echoes a similar tune, A Chevy With an Engine from China.

If you think the future I am describing is unlikely, I would love to here why you disagree. But please, give me a reason more substantive than the usual, “Man we are just that good” spiel. No reasonable global person buys that anymore.

As Bob Dylan sang, “These Times Are A Changin” ….

2 comments April 27th, 2008

The Big Show Comes To Beijing

Several weeks ago the Wall Street Journal ran a special section on China and the Olympics. Some great articles in there (see below). I put a *** by the articles I thought were particularly well done and relevant to our upcoming trip.

A Look at China on the Verge of the Olympics. Its Politics, its Religion, its Demographics — and Yes, the Games

The Olympics And Politics***

No Comparison: The Olympics helped bring democracy to South Korea. So why aren’t they doing the same thing for China?***

Brand Strategies: Despite global protests, most corporate sponsors are gambling that the smartest move is to stay the course***

In Search of … Something: A growing number of Chinese, unmoored by rapid change, are finding answers in religion***

Do As I Teach: Thanks to Donnie Pei, more Chinese schools are putting Olympics education on their curriculum

On The Move: Chinese officials want more farmers to migrate to the city. But they are also aware that migration brings problems.***

So Many Children Left Behind: Parents migrating to cities face a wrenching decision: what to do with their kids

Where Have You Gone, Lei Feng?: China needs heroes — and the hope is that the Olympics will provide some

Going For The Gold: China hopes to increase its medal totals this year. And the athletes hope they can cash in as well.

The Show Will Go On: The pomp of the Olympics has long been a favorite of authoritarian governments. This year will be no exception.

4 comments April 24th, 2008

D-I-V-O-R-C-E

You may not know who Tammy Wynette is, the lady that made this song famous. I saw her perform this song live during the Stockville County Fair in Stockville, Nebraska (population 57). I was a twitter-paited hormonal boy who thought he was in love with this super star country singer and beauty. I wanted her to divorce her then alcoholic and abusive husband, George Jones, another country singing legend, and marry 11 year old me right then and there. Oh, if she could only be mine.

C’mon. Stop laughing. I will take Tammy Wynette over the Tiger Beat or People magazine ding-dong you swooned over any day.

But this post has nothing to do with the break-up of joint ventures gone bad in China, but a lot to do with marital divorces.

Check out this April 1, 2008 WSJ article, Women MBAs More Likely to Divorce Than Men (same for women with law and medical degrees).

Gents and Ladies, what say you? Fact or fiction?

Are you immune from these statistical probabilities? If so, how do you know that will be the case? How are you planning for this, today, to minimize the chances of this happening to good ol’ you?

How will you lead and manage employees, which statistically will be half of them, that go will go through this type of a life changing experience, so that they can continue to be as effective for you/the firm as possible while and as they heal?

And fellas, let me really open a can of worms here and ask you this — are we a major part of the problem for such a trend? Our manhood aside, are men threatened by intelligent, driven, confident, successful, take-no-prisoners women? Do men unconsciously put pressure on the women they love? E.g., men expect them to look like a supermodel 24/7, stay forever young, work and help the clan make a high income, raise the kids, let them watch our Monday night football and March Madness with the boys while the doting wife serves drinks, pizza and cleans the house, etc. Be honest. If you are the man foolish enough to go down in writing here and argue, “Well, I would never do that, as I am one of those enlightened, sensitive men,” which of your female colleagues and classmates do you think will jump out of her chair next to you in class and strangle you for arguing that you are different than the other bizillion cave men that came before you (and me)?

Wait. I just realized there really is a China connection here. The Chinese have a saying: “Women hold up half the sky.” True or false? And what does this mean? Maybe you can ask some of the women in China you will meet what this means to them.

12 comments April 23rd, 2008

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The posts, comments and/or views expressed on this trip blog, whether by a Cal Poly student or faculty or an outside guest to the blog, do not necessarily reflect the policies or views of Cal Poly, the Orfalea College of Business (OCOB), any of the OCOB's graduate programs and/or other students who participate in the trip.