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Ennui, information overload, and Happy Birthday Shenzhen!

I have become ferociously bored with blogging of late. Part of it was summertime, with its combination of oppressive heat and other, more enticing diversions. Part of it was (and is) the absolute avalanche of business we’ve been getting – there is a bad economy out there, but people still need help in China. And part of it was (and is and I fear always shall be) the crush of sheer stupidity gushing out of Washington daily. It just is more than I can take most days. It says quite a bit when the business climate is more stable in an ostensibly communist country than a nominally capitalist one.

However, when the IT team is motivated to re-post a sales brochure to freshen up the homepage, I guess that is a sign I best get moving on the blogging front.

I will try to re-establish my blogging discipline, with at least a few posts per week.

In the meantime, here is the article that got me off my duff (hat tip to Dan Beach, aka, “Canada Dan”):

China’s ‘miracle’ Shenzhen marks 30 years. I first visited Shenzhen in 1994 and at the time never imagined it would become my second home. How different it is today than the ugly, gray city 16 years ago. China has a long way to go, but the distance it has traveled has been astonishing.

Other fun stuff:

  • There Are Now Enough Vacant Properties In China To House Over Half Of America – bubble, anyone?
  • Obama Added More to National Debt in First 19 Months Than All Presidents from Washington Through Reagan Combined, Says Gov’t Data – hmmm…wonder how the Chinese feel about that?
  • China’s UN diplomat in drunken rant against Americans – well, at least we are clear on how China’s UN ambassador feels about it.
  • Report: Castro says Cuban model doesn’t work – reaaaaaally, you don’t say. As unsurprising as this is, imagine if Cuba tries a “Shenzhen Special Economic Zone” 90 miles off the coast of Florida to turn things around. Another interesting interview with Castro (nothing to do with China, but very interesting what he has to say about the Jews, Israel and Iran).
  • You Know The US Is Screwed, When China, Gambia, And Jordan Have Better Property Rights – I’ve felt this in my bones for a while. The USA has been acting for some time as though it didn’t want to be an economic powerhouse, and this is just another example. More on America’s competitiveness here.
  • Buck Up, America – for a much more optimistic take. The points he makes about China and India strike me as valid.

More blogging soon, I promise. I really mean this time. Seriously, quit laughing.

China’s Mexico is inside China

300x250 run backup

This analogy has a number of problems with it (like most analogies), but I got the point the first time I heard Mike Bellamy make it.

Too many American industries rely on illegal labor to remain cost competitive, thus the constant drama on the border issue.

The China nearly every Westerner sees is the coastal veneer. The majority of China still dwells in the poor, mostly agrarian interior. Their source of cheap labor in internal.

And as this article in Slate by Brett Edkins points out, in a sense, many of those Chinese migrant workers are “illegal” anyway. Key paragraphs:

The United States could begin by conceding one of China’s principal arguments: Human rights are not just about individual liberty, but also economic opportunity. The Chinese “economic miracle,” which lifted 500 million people out of poverty in just one generation, is itself an unprecedented human rights achievement. Yet it gave rise to other pressing human rights concerns, including an issue that threatens to destabilize China’s Communist regime—growing discrimination against the roughly 200 million Chinese citizens who left their rural homes to find jobs in China’s booming cities.

In many ways, these rural migrants resemble undocumented immigrants in the United States. In China, they provide indispensable labor for vast urban construction projects and work in menial jobs as guards, waiters, cooks, or barbers. They are often mistreated by employers, generally live in poor conditions, and receive few social benefits and limited protection from the police. And their children are regularly denied public education.

Chinese newspapers, “Netizens,” and even Communist officials are calling for reforms. Their main target is China’s 50-year-old household registration, or hukou, system. Began as part of China’s state-run economy, the hukou system labels individuals as “rural” or “urban,” indicating their proper place of residence and binding laborers to the land. Today, rural residents are permitted to travel to the cities, but they can still be fined or forcibly returned home if they are caught working or living outside their designated hukou. Obtaining a temporary urban-residency permit from the police is beyond the means of most migrants, requiring a fee and employment documentation. Permanently changing one’s hukou by attending university or joining the military or the Communist Party is similarly out of reach.

Life for a city dweller with a rural hukou is difficult. Their hukou denies them urban welfare and access to public housing. It also excludes them from publicly funded health-insurance schemes. Since fewer than 3 percent can afford health insurance, most avoid medical care altogether. City judges often impose harsher sentences on rural migrants, and employers frequently withhold wages, knowing undocumented workers cannot complain to police without risking exposure.

I will admit I not a fan of the author’s wording, “undocumented migrants”. If you illegally cross a national border anywhere else in the world (including Mexico), you’ve broken the law. Only in the modern American journalist and politician world does that deserve an obscurant euphemism.

However, the point of the article is that despite the rapid advances, parts of the Chinese state are stuck in the Maoist past. One good thing about dealing with PassageMaker, you know our employees are treated well and legal. As a foreign owned firm, the government would come down on us like a ton of bricks were it otherwise.

Regardless, I am happy to see people in China, including members of the Communist Party, start to address the problem.

Some miscellaneous articles

Feeling lazy today. Sometimes the juices ain’t flowing. In no particular order:

Maybe get to some travel blogging tomorrow. Or not. You’ll have to check back to see.

Blogging is hard work

In less than a year I have gone from daily blogging to forcing myself to find something to write about once a week if that.

Since my return from China two weeks ago, I have been working like crazy trying to bag all the new business raining down on PassageMaker and China Quality Focus. The world economy is not out of the woods but we are definitely seeing an explosion of new RFQs, led by Australia. They are booming exporting the raw materials for China’s industry. Let’s all raise our glasses to Australia! More on that later…

I have been picking away at the travel log in my minimal spare time, but here are some interesting articles (some a bit old, but nonetheless).

  • Nixon wasn’t so bad after all – USSR planned nuclear attack on China in 1969 – and Tricky Dick stopped World War III. This is the kind of stuff you do as President that you can’t talk about, you have to hope historians get it right.
  • From Instapundit, a link to great blog about Japan, Ampontan. Today’s post is called Lame and Shameless, about ridiculous Western reporting on Japan. I am reminded of Andrea Martins, our representative in Brazil, who was actually born and raised in Beijing, the first and only Caucasian I’ve met who truly speaks native-level Mandarin. She told me once that if you visit China for a week, you can write a book. Stay for a month, you can write an article. Live there for 25 years, you have nothing to say.
  • Every once in a while you need to remind yourself how utterly insignificant you really are – Jupiter loses one of its stripes and scientists are stumped as to why.
  • Every once in a while you need to remind yourself how great your life really is – N.Korean women up for sale in China: activist. Tragic and terrible. I hope China steps up.
  • Interesting article from Mother Jones. Yes, really. The Last Taboo.
  • The New York Times finally realizes that many jobs aren’t ever coming back – The New Poor: In Job Market Shift, Some Workers Are Left Behind.
  • Speaking of vomiting…U.S. posts 19th straight monthly budget deficit. (hat tip to Dave Learn)
  • Dear God, let’s hope so – N.J. gov. sets tone for US – I have heard Christie speak, and it is QUITE refreshing. He sounds like a no-nonsense CEO sent in to save a company on the ropes. Math doesn’t lie. There is no money tree. You have to cut spending. However, if you could just raise taxes on The Real Housewives of New Jersey and leave the rest of the state alone, I think you could sell that. My God, what tacky people. The rise of China should be seen as largely a good thing, and maybe the Chinese economy will grow larger than the USA’s, but that was never a foregone conclusion. Our current political leadership across the board seems hellbent on making sure it happens ASAP though. As someone who has business interests in both USA and PRC, I just wish the USA would quit shooting itself in the foot. We businessmen would be just fine if we knew from one day to the next what was coming out of Washington.
  • Globish – I love it. What a great word. And the author nails it; I have had similar experiences many, many times in the Chinese-speaking world.
  • And finally, I can’t resist – Dog on the menu for Chinese astronauts. Actually, dog is pretty tasty, though I’ve only had it prepared in Korean restaurants in China, so I haven’t tried the Chinese version. Have to put that on the to-do list.
Back soon, hopefully with some travel blogging.

Is China the next bubble?

In my post the other day,”Eduscam?“, I pointed to the entirely anecdotal experiences I had recently with our college educated youth who haven’t a moment’s work experience between them when they leave school. I had one thought that I decided to save for today.

Many young souls seem to want to be bankers or lawyers, as though these are highly lucrative careers that guarantee a sweet life in the Hamptons. Certainly they can, but most bankers and lawyers slog along without ever making the big bucks. Moreover, they are careers without a real product that you can point to and say “I made this”. I tried explaining there are no safe corporate career paths anymore, and believe me when the cost cutting starts, they start in middle management.

I remember reading an article written by a British MP maybe 20 years ago that has formed part of my philosophy ever since. At the time he was writing about the challenge posed by Japan to the British manufacturing base, what was left of it anyway. I am going from memory and as the article predated the internet, I have had no luck finding it. But the quote went something like this,

British Leyland did not go out of business because of the Japanese. It failed because it made dreadful cars. Our economy today is almost entirely based on people in London trading bits of paper.

Real economies make things.

Did this make anyone substitute “Chrysler”, “Chinese” and “Lehman Brothers” in their heads?

The issue has been much debated of late about whether China’s economy is a bubble, perhaps the greatest bubble of all (see here, here, here, here and here). Certainly the yuan is undervalued. Certainly much of what you see in the Chinese cities is pastiche – empty buildings abound in any major city. There is vast overcapacity in many industries, driven by cheap loans from government banks to drive development and keep unemployment manageable, similar to the government role in the Japanese and Korean economies during their early growth periods.

But my mind and my gut keep coming back to that quote from the Brit – “real economies make things“. There is real manufacturing know-how in China and it grows stronger daily as they gain more experience. The infrastructure and man-power are real. These are not paper assets that vanish in the blink of the eye like the billions lost in the last two years in the USA.

Does the Chinese economy need to make adjustments. Yes, indeed it does. So does the USA. And as with all things, we will all be forced to one way or the other. But the knowledge gained in this Chinese industrial revolution will persist and remain a real asset even if the bubble does burst. Japan is still the #2 economy despite 20 years of stagnation. They have not fallen back to the misery of late 1940’s. I am confident China will survive as well, even with their monumental challenges. They have come so far in 30 years, I just don’t see them giving up, and when the world economy does recovery, they will still be the largest source of low-cost manufacturing capability on the planet.

And future bankers of America need to remember it is a whole lot easier to move a financial center than the infrastructure required for manufacturing.

PS – If you have never watched Top Gear, I highly recommend it. The 30 minute episode on British Leyland is well worth your time, if only to remind yourself of how awful cars used to be.

Arrogant Americans need not apply, the decline (?) of the West and what if the Chinese stop buying US paper?

“The enemy always has problems of his own of which you are unaware.” – George C. Marshall

Not that China is necessarily our enemy, but they are certainly a competitor, and I don’t normally borrow money from my competitors. Some interesting articles covering all sides of the USA declining(?) debate and other silliness.

Sorry nothing more for today, too much catch-up from Chinese New Year.

Days 6-13 – Shanghai Hooters, Mao’s Revenge, and rotten cell phone companies

1 view from the apartment 1

Day 6 – Woke to steady rain after a fitful sleep. The Chinese believe in sleeping on hard beds, as it is supposed to be good for you. And when I say hard, I mean sheet of plywood hard. And how having your hips so sore you can barely get out of the bed in morning after tossing and turning all night is supposed to be good for you beats me. We will be upgrading the mattress shortly.

View from the apartment window.

1 view from the apartment 1

2 view from the apartment 2

And though it feels cold here because of the damp, it is about 62 F. Salem, VA was in single digits in comparison. The company apartment is decorated with Chinese art (Mike has good taste). We even have a life sized terracotta warrior.

6 this guy startles me everytime

4 love the screws

5 ill have one of these in va soon

Our apartment complex

11 the fountain

he walk to the office takes maybe 5-6 minutes. The rain was coming pretty hard and the wind overwhelmed the umbrella. One thing you notice about side streets like ours is how poorly they are sloped to drain the water. Makes for enormous puddles.

Stopped at my snack shop for dumplings and a tea egg. I make tea eggs at home, and they are just that – eggs boiled in tea, dark soy sauce and spiced with star anise. The flavor is very subtle – it is 90% a regular hard boiled egg, but the last 10% makes all the difference.

12 tea egg for breakfast

Worked the morning in the office, and then had lunch at the restaurant around the corner. It has a few dishes that are wonderful, but is certainly not fine dining. The highlights:

Day 6 lunch best use for broccoli

Day 6 best use for squid

Back to work until late in afternoon, then I head to Futian district to take an old friend from Taiwan to dinner at an Italian restaurant. We were the only ones there, so service was exceptional, as was the food, as was the wine, AS WAS THE PRICE. Dinner for two cost 7 times as much as dinner on the street the night before! Luckily she is bringing some of her USA friends to PassageMaker, it was a legit business dinner, but man it is easy to get spoiled by the cheap food over here. I figured we all know what Italian food looks like, so I’ll spare you photos of gnocchi and tiramisu.

Day 7 – A clear day, rain has stopped. It’s knocked the smog out of the air, so a bright blue morning.

Day 7 morning

Day 7 street-scenes

Off early to our Assembly Center in Buji. I’m working on continuous improvement initiatives there as part of our new ISO 9000:2008 certification, something we achieved just last month. My background is in manufacturing, and since we are gearing up for what we think will be a very strong 2010, Mike asked me to come over and assist with introducing the alphabet soup of kaizen related initiatives – 5S, JIT, OJT, etc. Meet and greet the staff, which is dominated by women at the manager level. Only one man on the senior staff. You are seeing more of this in China, but my impression is PassageMaker is ahead of the curve here. On to lunch, which is fabulous as usual.

Day 7 an even better use for squid1

Day 7 best use for duck

Day 7 i love these little fish

Day 7 man they do vegetables well

Day 7 you have to get used to your food staring at you

On the way out, we passed the fish tanks that hold the seafood fresh and alive until it’s time to cook it. Everything in China is prepared fresh.

Day 7 if id known they had had geoduck

Day 7 duck fish

Later that afternoon we headed back to the office to pick up Julien Roger of China Quality Focus, our sister company. Mike, Julien and I flew to Shanghai for the Global Sources trade show, a trip that wasn’t scheduled for me when I came over, but I’m glad I went. The show went well and I’ve never really been to downtown Shanghai before, just the industrial area around the old Hongqiao airport. We flew into the new Pudong airport and I am convinced the planning went something like this – “To demonstrate the greatness of the People’s Republic of China, we will build the longest airport in the world!”. We landed late at the last gate and walked for 10 minutes in a straight line down the terminal until we got to the baggage claim area. This is a seriously long building. And thoughtfully they included no people movers like the trams at the Detroit airport. Considering the late hour and the lack of other arrivals, you’d think they could’ve found a found a gate closer to the exit.

Heading to the hotel, Ibis, a chain of affordable hotels owned by Novotel, a French company, what struck me about Pudong at night were the vast highways. Six to eight lane interstate grade roads as compared to the cramped streets typical of most Chinese cities. Pudong was farmland just a few years ago, and it definitely has a planned feel.

Although they fed us on the plane (a 2 hour flight with meal service – haven’t seen that in the States in decades), Mike and I were still hungry, so we found an American bar, Malone’s across the street and had a very good hamburger while listening to a GREAT Filipino cover band. Every bar and hotel in China has a Filipino band, all playing English cover tunes, even when the clientele is Chinese. And nearly all of them suck. This was an astounding exception. They were tight and the covers were quite good, including good hard rock and heavy metal. The singer had some serious pipes.

Back at the hotel, I noticed the bathroom is a pre-fabricated assembly. Smart idea for a chain. It was one of the nicer bathrooms I’ve had in China.

Day 7 pre fabed bathroom

 

Day 8 – After the best night’s sleep so far, up early to get to the show and set up the booth. On the way to the convention center, I saw this:

Day 8 just bizarre

They switched us at the last minute to give us a corner booth, which meant we had to cut up the posters to make them fit. I think the booth looked pretty good, considering.

Day 8 our booth

I’ve been to a fair number of trade shows over the years. Heavy truck shows are dull unless you really like trucks and truckers, car shows are fun, and motorcycle rallies are a blast. But in every case before, I was selling a product. If the guy’s got a Road King we have something for him, but not if he has a Dyna. We’re on this model of Peterbilt, but not that one. But now that I’ve done it, nothing beats selling a service. EVERYONE doing business in China needs Quality Inspections, Product Testing, Sourcing Feasibility Studies, Vendor Coordination, Intellectual Property Protection, Logistics and Assembly Inspection & Packaging. The industry doesn’t matter, they all needed at least one of our services. This was a gift and clothing fair, but it is the same at every show. It’s like we are selling beer at a NASCAR race. We got business cards from USA, France, Australia, Saudi Arabia, Venezuela, Israel, Nigeria, Iran, South Africa, New Zealand, etc.

Mike is a featured speaker at every Global Sources trade show (including Dubai, Hong Kong, Mumbai and South Africa this year), and he gave a two-part presentation spread over the first two days of the show. He did a great job and it was extremely well received by the standing room only audience. Rather than a canned sales pitch, he tells it like it is, barely mentioning PassageMaker or China Quality Focus. The soft sell works and many attendees stopped by the booth afterward to tell us so. They figure anyone with enough confidence to NOT shove his company down their throats must have it going on. And they are quite right. We do.

Day 8 mike is featured speaker

Day 8 mike giving his presentation

Julien Roger is also a tremendous salesman and very knowledgeable. I learned a great deal from watching his methods. Selling China Quality Focus’s services is easier, as Quality Inspections are very straightforward compared to PassageMaker’s services, but the combined message of the two companies meshes very well. We often have the same customers.

The convention center is still under construction and gigantic. As with the airport, the point seems to be making you walk as far as possible to get anywhere. Despite the impressive size, they apparently forgot about effective HVAC. It is unseasonably cold and I packed for south China. Day 1 of the show had no heat at all, which made it a real grind. Day 2 was a little warmer, but still uncomfortable. By Day 3 they’d gotten it going to the point it was now actually hot inside. HVAC needs some work for sure.

They also have very little in the way of food. The restaurants inside looked just plain bad, serving cold rolls and sandwiches wrapped in plastic like a vending machine. However, there was a McDonald’s right across from our hall, W2. It turned out to be the world’s smallest McD’s, about the size of a broom closet, with one little girl selling horrible looking “chicken sandwiches” out of coolers. I put that in quotes, because they were actually pork. Menu says chicken, she will say in English it is chicken, the box says chicken, but she insisted in Chinese that they were pork. We passed and were directed to the other McD’s at W5.

W5 is an international airport runway away from where we were. In 30 F weather, I was not interested in the walk, but there was nothing else, so walk we did. Entering W5 was a shock as it was still under construction, freezing cold and reeked of paint fumes. The McD’s was even colder than the rest of the building. It was a huge McD’s, brand new and manned by an army of eager young staffers in winter parkas. McDonald’s can’t heat their own place. It was also completely deserted. We were it for customers stoopid enough to walk that far in the cold for genuine simulated food. Our “food” in hand we sat down to eat our rapidly cooling cheeseburgers (with cucumbers instead of pickles) in 25 F comfort, huffing paint. Then the staff helpfully turned on the Backstreet Boys at headache inducing volumes to entertain us, because what lao wai doesn’t love the Backstreet Boys? We’d shout over the music to tell them to turn it down please. And they would, just a little. As it was the only food around, we ate there all three days of the convention. Our experience was exactly the same each time, including the yelling over the music to turn it down. Note to China: the progress over the last 30 years has been astounding, but build convention centers with decent places to eat and heaters.

Day 8 holy crap this place is big

Day 8 holy crap this place is big 3

Day 8 holy crap this place is big 2

Day 8 this is the smallest mcds in the world

Day 8 why put the real mcdonalds as far away as possible

Day 8 w5 under construction

Day 8 way to plan fellas

The interior of the McD’s was just as bizarre.

Day 8 mcds posters wtf

Day 8 mcds posters wtf 2

Day 8 mcds posters wtf 3

Day 8 rarest sign in china

With the first day of thee show successfully behind us, we head out into a bitterly cold Shanghai sunset.

Day 8 shanghai sunset

For dinner, we are off to meet friends at Shanghai Hooters. Yes, really. This turns out to be loads of fun. Mike, Julien and I meet up with one of our sales reps, Dan Welygan, who worked in our Shenzhen office for about 4 years. Also in our quintet is a classmate from the University of South Carolina now living in China. Many, many wings and beer later, I have a new found appreciation for Hooters. It was a bold decision to open this restaurant, as typical Chinese girls lack the requisite body type required of a Hooters waitress. And they have to be attractive and be able to speak English. A pretty small labor pool. Our waitress was very good, spoke solid English and really new how to work a room. A very bright young lady, she has a future in sales for sure.

Day 8 our waitress elva

Day 8 hard to find hooters in chinaDay 8 hard to find hooters in china

Day 9 – Second day of the show went as well as the first. Part two of Mike’s seminar was very well received and many of the attendees have stopped by the booth, several 2-3 times. After the show, we meet our web developer, a French graphic designer living in Shanghai, at a trendy coffee shop for sandwiches. This place was in a glittering new mall, still decorated for Christmas. My cameras does a poor job in low light, so my apologies for the quality of the photos.

Day 9 christmas decorations

Day 9 first of two ferraris in 2 minutes

Day 9 yep thats a christmas tree

Day 9 this is what irony looks like

So far no Chinese food in Shanghai. After the meeting, off to meet another USC classmate at The Boxing Cat Brewery, the nicest brewpub I’ve ever been to. As I was once in this business, that is quite a statement. It was in a 100+ year old home in the old part of Shanghai, beautifully refurbished. The brewpub was 3 stories, with a bar on the 1st and 3rd floors. It felt exactly like a British pub, with beer selection and menu to match. Since we had already eaten we did not order anything, which now that I know the chef was trained at Le Cordon Bleu in Paris, I heartily regret. I have a feeling it will not be my last trip. My, how far this country has come in just a few short years. However, even The Boxing Cat has moments that confound.

Day 9 were the heck do you want me to put it

Day 10 – Last day of show, and the pollution is pretty bad today. Traffic is light, and some exhibitors start packing up almost from the opening bell. We stayed until nearly the scheduled end at 5:30 PM, though we give up when they start dismantling the booth around us at about 5:10 PM. Global Sources has been good to us and we thought it the honorable thing to do to stick it out to the end, though honestly the show really ended around noon. Off to Pudong airport (which is even more gigantic from the outside and has the coolest road system connecting it I’ve ever seen) to catch our flight to Shenzhen. Our first Chinese meal of the trip is some very good Cantonese cuisine at the airport.

Day 10 shanghai pollution

Day 10 always a bad sign when the gates are in triple digits

 

Day 10 cantonese food chinese airport food is much better than usa

Day 10 cantonese food chinese airport food is much better than usa 3

Day 10 cantonese food chinese airport food is much better than usa 2

Day 11 – Worked all day to get caught up from the show. Verizon’s data service here stinks, a pale comparison to my old AT&T service (of course, that is reversed in the USA, which is why I switched). Many emails did not come through to my blackberry. I also discovered that Verizon is charging me $2/minute to RECEIVE CALLS. This was one of the specific questions I asked before adding the “China plan” for this trip. I have already written about how woefully trained their salespeople are, and this takes the cake. Since the trip began, I have been receiving calls from clients, family and friends – including a call a 3 AM from a client who had missed I was not in USA. My team in the USA is having words with Verizon about this, but let’s just say, it was a cute phone bill. China Mobile by comparison, charges nothing to receive an international call. Heck, their rates to MAKE an international call are less than Verizon. So, if you want to get in touch with me, send me an email and I’ll give you my China Mobile number.

I join Mike and Adam Supernant for dinner at a local place in Liantang.

Day 11 chinese donuts I like the fried ones steamed ones not so much

Day 11 gross

Day 11 very common to have fire at the table

Day 11 quite tasty tofu and pork

After dinner I was invited to join some of our Chinese co-workers at a nightclub. I was flattered to be invited and went along. After several hours, I had my first run in on this trip with the dreaded Mao’s Revenge. I am trying to tell it like it is for those of you who don’t travel overseas, and if this strikes you as TMI, it isn’t. You need to know what you are in for.

While western style “sitters” are becoming more common, squatters still dominate. In a sense this is good, as sitters are not as sanitary ( I mean, everyone else is sitting there too). But when you’re in an emergency situation and you are not used to squatters, this can get dicey fast. My advice for survival in these situations:

  1. Wear sensible shoes with good rubber shoes – I prefer Blundstones.
  2. Wear jeans. Avoid khakis – not the color issue but the way the pockets are cut. I always keep everything – wallet, keys, passport, phones – in the front pockets of my jeans.
  3. This is a very uncommon position for a Westerner. I have pretty strong calves and thighs, and have learned how to balance, but if you never done it before, try it and hold the position for 2-3 mins. It takes some getting used to and you don’t want to find out the hard way you can’t do it. Luckily the squatting position is more conducive to the situation at hand, and so things tend to go quickly.
  4. Carrying a small packet of tissues is a good idea. Toilet paper in a public restroom anywhere in the world is never a given. Handkerchiefs and socks (single use of course) will do in a crisis.
  5. Carry a bottle of prescription Lomotil or the generic. I always do and there is no OTC medicine that comes close. It WILL stop the drama.

My evening cut short, off to sleep. Day 12 is Sunday, market day in Liantang, and Mike and I head to Mian Dian Wang, or “Noodle Snack King”, my favorite fast food chain in the world. 14 line cooks actually making the food by hand. Total cost of the meal is about 60 RMB, or less than $9.

Mian dian wang

Day 12 mian dian wang

Day 12 mian dian wang 2

Day 12 mian dian wang 3

Day 12 mian dian wang 4

That evening, Mike threw a dinner party at his home. It was great to see old friends and an even better meal. Simply the best food I’ve ever eaten in China. Mike’s wife and the maid did all the cooking.

Day 12 two women in this kitchen in about 2 hours..

Day 12 two women in this kitchen in about 2 hours.. 2

Day 12 made this

Day 13 – Monday – Last night there was a little too much “medicinal wine”. Whenever you hear that phrase, run screaming in the other direction. After such an amazing meal, we needed something basic to calm the acid seas, so off to Subway (yes, really). A steak and cheese later and all is right with the world. With some lingering Mao’s, I head to the apartment to work from home. It was a glorious day, 70 F and clear blue skies with a light breeze.

Day 13 our apartment complex

Later Mike asked me over to finish up the leftover ingredients from the dinner party – there was no left over dishes, just raw materials. This is the modest result.

Day 13 a light meal

Two customer visits tomorrow and time at the factory.

All for now…

 

The Law of Conservation of Filth

The Law of Conservation of Filth: In order for something to get clean, something else must get dirty.

Corollary to the Law of Conservation of Filth: It is possible for everything to get dirty and nothing to get clean.

This is one of Murphy’s Laws. I used it in my answer when asked recently about whether “green” technology had caught on yet in China. Short answer, not yet.

Sadly, many products are just plain dirty to make and China is using the energy resources they have available (coal), and the production technologies that are easiest and least costly to adopt – that is the “brown” versions. Environmentalism as currently practiced in the West is essentially a luxury good, and I have yet to see a “green” technology that actually costs less than the “brown” alternative. Only by penalizing the “brown” and subsidizing the “green” can the case be made.

That is not to say that things aren’t changing in China. This article on the recent record-setting pollution in Hong Kong highlights the issue:

The problem of air pollution in Hong Kong prompted Australia earlier this year to include a health alert in its advice to travellers to the southern Chinese city, warning that it could aggravate some medical conditions.

Pollution has in recent years become an increasing health and economic headache for the authorities in the city of seven million.

Emissions from the factory belt in southern China over Hong Kong’s northern border combined with local emissions from power plants and transport to generate a thick haze over the city for large parts of last year.

The government has stepped up efforts to cut vehicle emissions, including offering tax concessions to users of environmentally-friendly hybrids.

Now the article does not make completely clear which government is trying to curb vehicle emissions – the Hong Kong Special Administrative Region’s (HKSAR) relatively independent government or the PRC government across the border. I suspect it is HKSAR, as I have seen no such effort in PRC, and it makes sense for HKSAR to do so. It is a wealthy city and clean air is a sign that you’ve reached a level of affluence where the manufacturing and resource extraction is no longer the driver of your economy (e.g., Singapore).

Most of the great cities around the world have traveled this path. The early industrial towns of England had skies so black with coal soot that children developed rickets from lack of sunshine. The industrial hinterlands of New York City poisoned the oyster beds surrounding the city, forcing a culinary switch from the local seafood to hotdogs. The Cuyahoga River famously caught fire in Cleveland in 1969 (and at least 9 other times going back to 1868). Rob Gifford in his brilliant book, China Road, writes about the terror of bicycling through a northern Chinese coal town.

I am not trying to weigh in on global warming or pollution in general. Everyone wants clean air and water. It is just that the Kyoto Protocol was doomed to failure on Day 1, as it exempted the developing world, especially China and India. It also failed to recognize that wealth is created in the manufacturing sector, and changing production methods and energy sources was not going to be easy or inexpensive. Such improvements can only be effectively implemented with a level playing field (compliance costs equal to all competitors). In a free trade environment, the cost advantages to sourcing in China, Mexico, India, etc., insured that the Protocol would fail. No wonder the US Senate voted unanimously to reject it. While some in the developed world may speak blithely about bankrupting core industries like coal, China and India do not have the luxury (yet) to pursue such a path. They each have over a billion overwhelmingly poor mouths to feed.

PassageMaker can help find Chinese firms who use green technology – like the Hong Kong-owned plating company we found for one project that recycles 100% of its effluent – as our clients’ require it. However, such suppliers are the exception to the rule and always more expensive. Our Sourcing Feasibility Study is just that – a study to determine if the client’s goals are feasible. Often clients want a “green” product for a “brown” price. And most of the time, that’s not feasible. Yet.

China steps up, slowly but surely

In my post yesterday, I wrote that China was not embracing “green” technologies… yet.

This article in The Washington Post gives a good overview of the steps China is taking to make that ‘yet’ come quickly. Nuclear may not be everyone’s idea of clean energy, and certainly there is a large CO2 cost upfront to build the reactors, but once past the hurdle, you aren’t burning coal anymore. As someone who was once lost on the streets of Beijing in clouds of coal smoke, this would be a very good thing.

OK, so I was blind drunk at the time, but less than 100 ft of visibility is still really, really bad pollution. I make the point to American environmentalists all the time – you really don’t know what pollution looks like if you’ve never left southwest Virginia. Heck, I would argue you don’t have a clue until you’ve left the United States

China in general is progressing at an astonishing rate – industrialization, legal framework, financial systems, the largest mass migration in human history – and hopefully rational environmental policies follow suit. As I see it, the Chinese labor pool is so vast (at least until the demographic time bomb that is the one-child policy causes an economic implosion in about 30-40 years) that they can maintain their manufacturing cost advantage and still provide a (marginally) healthier environment for their citizens.

I hope for the sake of our staff in Shenzhen, that the government gives this effort more than lip service.

No, it’s a want to issue

Cogitating on the 60th anniversary of the PRC, one cannot fail to consider the current state of the USA, and as a microcosm, our domestic automotive industry.

Yesterday, it was announced the deal with Penske to buy Saturn fell through, and so dies another GM marque. In this case, I have a personal interest, as I drive a Saturn. I bought it on one gruesomely hot day years ago. I remember the day quite clearly, as at the time I was traveling quite a bit and had rented a series of then-current Detroit iron to evaluate the offerings. I had settled on a Dodge product (yes…I know), and due to the repairs required to keep my very old Ford running, we could delay no longer. So with pregnant wife and little girl in tow, we went car shopping.

Before you cut in to to ask why Mr. China, Mr. All-Things-Asian here has a problem with foreign brands, just don’t. It’s complicated and irrational bordering on schizophrenic. Just stick with the story.

And before you interrupt again and ask why Mr. Captain-of-Industry drives a Saturn, here’s why – cars, like horses, are for riding. For basic transportation. When one dies, you get another one. If you need to a car to show the world how cool you are, you’re not. If I show off anything in this world, it’s my wife.

But I digress.

Now, I’ve lived in Singapore, Taiwan, and spent considerable time in South China. I grew up working summers in Virginia factories without A/C. I cut my teeth as a manager in a South Carolina metal stamping plant that (surprise) got hot in the summer time. I can handle the heat, but the parking lot of that Dodge dealership reminded me of the scene from Lawrence of Arabia where they have to cross a stretch of desert called “The Anvil of the Sun”. My daughter, not yet 3 if I remember, just wilted. I thought my wife was going to have heat stroke. The BEST part – the part that still informs my concept of customer service to this day – was that I could see the entire sales staff in the air conditioned office, drinking sodas and looking out the window at us – the only customers in the place – in-between telling jokes to one another and calling their girlfriends on the company phones.

After 10 minutes of cooking my family and waiting for someone to bestir themselves to come sell me a car, i.e., do their jobs, I loaded the family into the wife’s Oldsmobile (yes…I know) and drove 300 yards down the road to the Saturn dealership. One (1) hour, several bottles of cold water and snacks to reconstitute the toddler in the A/C, later and I had a Saturn. Yes..I know. It’s not a great car, but it is fast enough, gets decent mileage and is (apparently) invisible to radar. 100k+ miles later, and it is still going strong. In that time, the dealership has always been friendly and professional. I will sincerely mourn seeing these hardworking and decent people lose their jobs. They have done nothing wrong other than sell and service a decent people-mover at a fair price.

And the Dodge dealership? It got its franchise revoked by the Obama administration. Now when you drive by its empty lot, you are greeted with huge banners saying “YES, WE’RE STILL HERE! PARTS DEPARTMENT STILL OPEN!”. I won’t comment on the political or economic wisdom of that move by the government but as far as it applies to this particular dealership?

good.

All this was put into sharp focus by this brilliant piece by the Autoextremist.com about Cadillac’s attempts to return to the top of the heap. As the article points out, Cadillac’s recent product offerings are excellent, but after so many years mediocrity interspersed with chunks of mind-blowing awfulness, the recent successes only get you back in the game. You have to maintain this level and build on it for at least a decade or more before you have a chance of getting back on top. And the author, Peter M. De Lorenzo, fears as I do that Cadillac won’t. Here are the key paragraphs:

Because it will take an all-consuming passion of total commitment – a relentlesswant to, if you will – on the part of the entire organization, something that currently only appears sporadically and only in some quarters of the division.

It will take a clear understanding of who they are and a clear vision as to where they want to go (an idea that perhaps sounds a bit too simplistic, that is until you’ve been inside some of these organizations and realize how difficult it is to get everyone on the same page and pulling in the same direction).

It will take a focused consistency in their design and engineering regimens and particularly in their product execution. What does that mean? If Cadillac is to be Cadillac again, the people toiling in it need to understand that the division’s recent resurrection to respectability is only that, respectability. It’s not a ticket to “the club” yet. Yes, the CTS-V is an incredibly outstanding machine, but it shouldn’t be the culmination of where Cadillac wants to be, because it’s just the beginning. Every single new Cadillac must bristle with the kind of creativity and executional excellence that’s evident in the CTS-V if the division is to attain real greatness.

If Cadillac wants to get back – all the way back – to the reputation it once enjoyed and thrived upon then it has to put its stake in the ground and understand that the raison d’etre that once propelled it to greatness, that brand image that was seared in the consciousness of consumers for decades has to not only be renewed, it must be embellished and enhanced for this new age.

Laughable? Not from where I sit. This isn’t a technology issue or a talent issue, because Cadillac has everything it needs to succeed as a luxury-performance automaker.

No, it’s a want to issue.

China was once the top of the heap. 1000 years ago, anyone visiting this planet would have taken one look at the Middle Kingdom and decided that was the place to be. And then they stumbled, became complacent and fell far behind. Now they are charging back. And there is no question in my mind that they have the want to part of the equation figured out. Frankly, sadly, I’m not so sure about America anymore.

As I’ve said before, China is back, and saying so isn’t anti-American or pro-Chinese. Mike and I saw this coming more than 15 years ago and planned accordingly. We realized then, as I cautioned students at my alma mater last month, there are easily 3 billion people on this planet who want your job. The world is an intensely competitive place. If you want to succeed you have to get the want to part down.

PassageMaker has grown in 10 years from one guy with one customer to a company of 150 people with customers around the world. Mike and I and the rest of the PassageMaker team have the bricks-and-mortar and the technical capabilities, either in-house or through our Endorsed Service Providers to make your project a success if China sourcing is required. But most importantly, for us, want to is not an issue.