Friday, October 26, 2012

Colonizers or Colonized?

In the history of the world, countries have either been colonizers or colonized.  The United States has been both, which is why we are sometimes schizophrenic.

I was ordering some things from China the other day.  You can buy directly from China, with no middleman, through sites like eBay.   They ship by China Post, which surprisingly, gets here in about a week or so.   I bought a wireless card for $5 including shipping.  I bought a pair of biking gloves for about $7 including shipping.  They are pretty good deals.

In this election year, there is a lot of China-bashing going on.    Just as we demonized the Japanese in the 1980's, today the whipping-boy is China.

Just a recap, in case you were asleep during the 1980's or were not born yet:

Back then, the Japanese economy was strong.   Japanese car sales were starting to take off (but were nowhere near the levels they are today).  A Japanese car actually cost less than a US-made car, and people complained that their labor rates were too low and that they manipulated their currency to make their exports more competitive. (Stop me if any of this sounds familiar in terms of today's dialog).

They were also accused of "dumping" products here for below cost, to gain market share and put U.S.-makers out of business.   For example, U.S. Marine (the makers of Bayliner, Sea Ray, Mercury and Mercruiser - the GM of boats) filed an anti-dumping complaint at the ITC against Yamaha.   The complaint was dismissed after the ITC discovered that the largest customer for Yamaha power heads was, in fact, Mercury Marine, who painted them black and sold them as Mercuries.

The Japanese went on a buying binge, buying land and hotels, and golf courses, on the West Coast and in Hawaii.   They also held a lot of our national debt (and still do).   The alarms were sounded!  The
"Japs" were taking over!   Time to do something about it!

So at the GM factory where I worked, they brought in some tired old Datsun or Toyota and everyone took turns smashing it with a sledgehammer.   That will show those "Japs!" won't it?   Of course, the hundreds of man-hours lost doing this stupid stunt put us even further behind.  Today, that plant is closed, 8,000 people were laid off, and the 22-acre building is now a warehouse for Chinese-made goods.

What happened to Japan?   Well, as they became more wealthy, the Japanese worker demanded more money.   Suddenly their cost advantage evaporated.   And the Yen became strong, making exports difficult.    They alleviated this problem, somewhat, by building factories in this country.   But today, Japan is recovering from the "Lost Decade" of the 1990's, when their economy was in the shitter, while ours was roaring back to life.   Nature abhors a vacuum, and in a free-market, eventually equilibrium sets in.

Today it is the Chinese that are the bad guys.  But they really aren't "bad" so much as they want to get ahead.  And you can't blame them for that.   And there are signs that what happened to the Japanese is happening to the Chinese - and India as well.   Wages are rising, the cost of producing goods is increasing.  The vaunted advantages of manufacturing in China are eroding, slowly at first.

And of course, the bad press surrounding the working conditions and lack of pollution controls, is starting to affect U.S companies.  How long can Apple keep its image as the "good guy" in the computer business, when story after story comes out of China about the horrific working conditions in the iPhone factories?  Eventually, Apple will be shamed into doing something, and that "something" will increase labor costs.

But it struck me that we have more in common with the Chinese than we think.   Our country was founded as a colony - or series of colonies - of European nations.   The Americas were colonized by the English, French, Spanish, and Portuguese.    And Europe, for the next Century, went on a colonizing binge - subjugating and subdividing Africa, the middle-East, India, and of course China and Indonesia.

We threw off the yoke of colonialism early on, and likely this was because as descendents of Europeans ourselves, we bristled at the restrictions of being a "colony" and not self-governing.   And over time, this revolution spread - even to Europe, and of course, eventually to nearly every colony across the globe, including China.

But in the interim, of course, we ourselves got into the game - laying claim to a manifest destiny and declaring war on Spain, Mexico, the Philippines, and a number of other countries, in order to gain territories, new States, and control and influence.   We even tried to get into the China game, although the British seemed to have the Opium-Tea-Gold triangle sewn up.

There are two points of view, I think, in the United States - those who think we should be colonizers like our European Ancestors of old, and those who think, as a former Colony, we should know better.

The former are the folks who are always shouting to invade this or that country, lest the Communists get there first, or today, Al Qaeda.  And perhaps there is some merit to this philosophy.  But, like playing whack-a-mole, it is a game that never seems to end.   Today, the latest threat is a small impoverished country called Mali, where the Taliban is taking hold, and terrorizing the populace.  Tomorrow, it will likely be somewhere else.

How do our allies and enemies handle this?   In the old days, the Soviets tried to snatch up as many countries as they could, into their "sphere of influence".  The cold war was a real war.  They finally had their comeuppance in Afghanistan (a cautionary tale there) and in trying to match us, dollar for dollar, in military spending.

Today, our military spends as much money as the next ten largest militaries, combined.   And there is talk of spending even more although the Pentagon really isn't keen on the idea.

Right-wingers like to spread e-mails with fictitious pictures of "the next generation of Chinese Aircraft Carriers!"   But the reality is that China has one (1) aircraft carrier, launched in 2011, which was actually a refurbished Soviet aircraft carrier.  Some threat!

So how does China spread influence in the world?   Well, economically, not militarily.  For example, they are building highways and infrastructure in Kenya.  Unlike an invasion, the locals actually appreciate this, as it creates jobs and provides an infrastructure that allows them to advance as a people.   China is giving them a hand-up into the modern world.   We send drones with Hellfire missiles.   Which is is a better long-term strategy to win the "hearts and minds" of the people?

The real threat from China is not fictitious mega-aircraft carriers that exist only in the minds of right-wing cranks.  They don't exist, and thus are not a threat.  China is not trying to project military power very far outside its own sphere, or indeed, far from its shoreline.   The real threat from China is not the low-cost goods and low-cost labor.  Rising labor costs and a slowing economy there will even things out, over time.

No, the real threat is that while we are trucking around the world, kicking ass and taking names, the Chinese are going around making friends and helping people out.  Rather than try to colonize, they are taking the point of view of the colonized.   Who will win out in the end?   And who will go bankrupt first?

We have to decide which side we are on.  Do we want to extend the excesses of the European Colonial Era into this Century?  Or is there another way?