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Thursday, October 27, 2011

My trip to China





To China with Love

I had a zillion reasons why going to China would be a bad idea. It didn’t help that the person who’d been cyber-stalking me for months had emailed on the eve of my trip to say “something bad is going to happen to you soon! We are praying!” I was petrified. But the police assured me that this individual was not a terrorist who would blow up the plane and that it would be pretty lame for me to pass up a trip to China on account of someone with some issues; so I braved it and went. But I had grave concerns about the wisdom of flying across the planet with this situation going on. Plus, as everyone knows, I’m the world’s most nervous airplane passenger and I wasn’t looking forward to being airborne for 14 consecutive hours.

Well, suffice to say, the connecting flight from Narita International Airport in Japan to Beijing China was just absolutely horrendous. I was certain that, even assuming the police had been right that the stalker was not going to blow up the plane, that for sure he was doing voodoo chants in an effort to pluck that bird out of the skies and plummet it into the Sea of Japan. That plane gyrated, bounced, dropped, and rattled like a roller coaster from start to finish. OMG. It was as if, at any moment, it would deposit me and the rest of the passengers into the cold Pacific where a shoal of Great White Sharks would feast on our carcasses for months to come. After some time, I found myself saying my last prayers, and asking the Father that, if indeed he was ready to make his introduction, if the stalker had somehow had some insights into this, then at least give me oblivion before I hit the water.
But it worked out. When we landed at Beijing International Airport, it was on the runway, I was in one piece, and there were no sharks in sight. And the trip turned out to be one of the positive highlights of my year at St. Marys University in San Antonio, Texas.

I couldn’t believe I was in China. A sense of excitement engulfed me from the moment I landed. Beijing International Airport is an enormous hub like JFK, Heathrow and Hartsfield Jackson International airports, except everything is written in Chinese. The good thing was that though Chinese calligraphy was everywhere, all signs had English subtitles. So right away, it felt familiar. Plus, luggage carts were free and Dr. Hu was there, as he had promised, to greet me, since, ever the absent-minded globetrotter, I’d neglected to book a flight that was sensitive to local time—and my flight arrived at midnight, China time. Dr. Hu was able to converse with the cab driver in Mandarin to get me back to the hotel and so I didn’t have to worry that my Chinese was limited to “Ni hao” and “Xie, xie.”

I felt like Alice in Wonderland as I peeked from behind the car window on the ride from the airport to the hotel which took us past a slew of high-rise buildings and skyscrapers. Many of these edifices are owned by major U.S. corporations. Actually, everywhere you looked there were signs of Western culture all over Beijing -- American culture in particular -- from the golden arches of the McDonalds trademark, to imitation coffee shops meant to evoke Starbucks, to Kentucky Fried Chicken fast food joints. That Beijing was not more otherworldly was almost slightly disappointing. It could easily have been a major U.S. city except for the fact that, not counting us tourists, everybody was Asian.


First Impressions

There is a palpable sense of community and family that permeates the city from dawn to dusk. (And their dawn begins at 4:00 a.m.; that’s when the sun rises in Beijing for some insane reason.) Each day, the entire neighborhood is out—all ages from infants to seniors in their 90s—exercising. Outside the hotel, there is an outdoor public gym and it was a marvel to see how the whole community came out and worked out together every day – running, playing basket-ball, doing tai chi, biking and stretching. Because they obviously put such an emphasis on physical activity, so much so that even their senior citizens are out exercising with their children and grandchildren in a communal setting, it would not be terribly surprising to learn that China's healthcare costs are substantially lower than the U.S.

Some mornings I joined the neighborhood on the tracks for a meditative walk. Yes, I got a lot of stares and frankly, that’s probably because, well, Beijing is not the most racially diverse city in the world so there aren’t that many dark skinned people there. The kids were particularly amused by my presence. They would stare at me, point at me, and giggle uncontrollably. I was starting to take it personally till a little boy approached me one day – he was about seven going on thirty-two and cute as a button—and drawled, in perfect English, “My name is Jake. What is your name?” I was smitten, to say the least. As Renee Zellweger famously said in one of her movies, “he had me at hello.” Whenever he saw me after that, he would run to me to say hi and we became buddies.

That said, I must share one observation: I think all that exercise must be how the people in Beijing stay so skinny because you should see them eat! And their diet is loaded with carbs from rice, pasta and dumplings, and with fats from peanuts and meat. It was de rigueur to see friends hanging out, roadside, eating Chinese food with their requisite chopsticks. Retired men in particular seemed to have a penchant for hanging out with their buddies, playing board games and noshing on exotic dishes with their pals. Yet, in spite of all that eating, with very few exceptions, everyone in Beijing is stick thin. Many of the young women evoked the stereotype of the “China doll” with tiny waists and demure manners. Indeed, even the men have smaller waists than a lot of Western women I know. It is mystifying how they stay so trim, actually. Somebody suggested that the secret is in the tea. They drink a lot of tea (and Ginseng infusions) in China, and apparently, tea is good not just for fertility (China, arguably, is the cradle of fertility of planet Earth with a population of approximately 1.3 billion according to the 2010 Census, despite a one child per family rule, and some believe that the secret to their procreative propensities might lie in their teas, cures and medicines) it also seems to help to keep fat in check…. By the way, if you are a tea lover, the Laoshe Tea House is a first class venue for high tea with entertainment in Beijing. You can’t not go….

There was something very “harmonious” about Chinese society, as I saw it. People seemed very contented. Whether this is by design (President Hu Jintao is supposedly trying to create a “harmonious society” in China) or inherent, is unclear. But one thing is for sure, these folks know how to commune with their fellow human beings, meditate, slow down, and enjoy life. I kept wondering, “This what ‘Communism’ looks like?” It was all so hypnotic, so relaxing. Maybe that’s why I slept a lot while in Beijing, despite dealing with a litany of hate mail from across the Pacific Pond. Or maybe I just never quite got over my jet lag because most midday afternoons while other students were out sight-seeing at the Forbidden City, the Summer Palace (China’s Versailles), the Great Wall, and all the other touristy spots, I snuck away for a nap. I would open the shades just so slightly so that the Beijing sun would peak through the windows, put on a CD filled with Chinese folk music and allow the music and the sun to lull me to sweet, peaceful, harmonious slumber.


Chinese Style

One of the things I absolutely loved about China was the girly fashions proliferating all over the city. It was a total relief because it meant I didn’t feel hopelessly old and old-fashioned with all those long, maxi dresses I had packed. The reason I had done that was because one of the professors had said that denim would be hard to launder (washing machines and dryers seem to be a major indulgence in Beijing) and so I had packed mostly long lite dresses that I could hand-wash. The rationale was that not only would they be easier to launder, but dresses would facilitate dealing with the “squatting” situation that occurs each time one makes a trip to the loo. But it turns out that many Chinese women favor long lite dresses as well. So that worked out – from a fashion perspective, at least. The loo situation is an indelicate subject I won’t get into. Suffice to say that in that respect, the way I feel about it is, give me America or pull out my toe nails.

The Dongcheng District in Beijing is a cool neighborhood and is filled with hip stores and trendy eating spots. Walking through the Hutongs of this part of the city is quite a treat because that is where the “emperors, empresses, and concubines” do their “catwalk.” Fashion snobs in the West may say that Beijingians lack the fierce, stop-the traffic sense of style of the fashionistas in Paris, London and New York. But I disagree. I think they have a look that is evolving and it wouldn’t come as a huge surprise if Beijing becomes a fashion capital within the next decade or so. The Beijing style as I see it (and this is for the girls; guys in Beijing seem to be into fashion as much as guys in any other city, which is to say they could care less) consists of chiffony, frilly, lacy, feminine tops and dresses; girly sandals; elaborate, colorful hair ornaments; delicate jewelry like single strand pearls, skinny jeans, short shorts and everything and anything that glitters. You almost think they are heading to a casino in Macau after a tough week at the office with all that glittery clothing and blingy hair ornaments; but they are not. That’s their everyday wear. Oh, and the parasol and straw hat, which invariably come in a rainbow of colors and elaborate edges and designs, are ubiquitous as the sun is intolerably hot in June (although not nearly as hot as San Antonio in August).

Surprisingly, many Chinese women seem to eschew fake designer handbags and watches even though these items are staples at the Silk Market where most Westerners go to buy knock-off Rolex, Gucci, Burberry, Hermes and Louis Vuitton. Instead, they carry simple pocket books by unknown designers who are also probably Chinese.

The Silk Market

The Silk Market is definitely a must visit in Beijing. There is a dizzying array of knock-off merchandise from every conceivable brand name designer there. This shopping Mecca is highlighted in every guide book about Beijing; and it is quite the tourist trap. If you are not careful, you can blow your travel budget on a lot of trinkets and merchandise that you probably don’t even need.

But it sure is fun while you’re doing it. You’ve never seen anything like the Silk Market. It’s mayhem; wild, crazy and fast paced. Anything you imagine that you might want to buy in Beijing, you can get it at the Silk Market – from I-phones, to Nike sneakers, to cultured pearl necklaces and Chanel handbags, and more. You can even get bespoke suits in less than a week. You definitely want to shop till you drop at the Silk Market. But there are two caveats: First, remember that all that glitters is not gold. Second, those Louis Vuitton Moet Hennessey luggage and Hermes bags are not hand-sewn by artisans in the South of France like the real ones are. They, along with all the other knock-offs, are mass produced on an assembly line somewhere in China. So, the quality is not the same. And you know what? It’s not like anybody pretends otherwise. Thus, if when you return home the straps come apart after just two months, it shouldn’t come as a huge surprise. It’s called caveat emptor.

By the way, don’t be too soft-hearted with these venders. They may come off as desperate to make a sale, but it’s not because they have no money. Many of these folks are loaded and are only desperate to divest tourists of as much money as they possibly can. They are all about the Yuan and when it comes to matters involving the Yuan (Renminbi), these folks are way more cunning than the proverbial fox. If they can get away with it, they will even make your change in Russian Ruble (they pulled this with one of my travel peers) so you better double check your bills when you go shopping at the Silk Market or anywhere else in the City for that matter so that you don’t get ripped off. That said, you definitely can’t go to Beijing and not go to the Silk Market. It would be heresy.



Law

From a legal perspective, what goes on at the Silk Market is shocking to put it mildly. China, as you probably know, accedes to various treaties that protect intellectual property such as copyrights, patents, trademarks and the like, including but not limited to the Paris Convention, the Madrid Convention, the Berne Convention, the Madrid Protocols, and TRIPS (Trade Related Aspects of Intellectual Property Rights which provides in part, “[m]embers shall provide for criminal procedures and penalties to be applied at least in cases of willful trademark counterfeiting or copyright piracy on a commercial scale”). Indeed, China enjoys bragging rights that it has actually signed many more of these Intellectual Property related treaties and MOUs (Memorandums of Understanding) than the United States has signed. Yet, you walk into the microcosm that is known as the Silk Market and you wonder what the Dickens is going on. How can boot-legging, counterfeiting and copycatting be so openly on display when China has acceded to all these treaties? Are there no enforcement procedures whatsoever? And if there are enforcement procedures how come all these merchants get away with so much IP infringement? Was signing the treaties merely posturing on China’s part? What is even more disconcerting, many young Chinese seem totally unapologetic about this reputation of being “copycats” and “bootleggers.” It’s almost as if they think this behavior is “pay back” for past wrongs committed against them and, largely, their reaction seems to be that it is Western greed that drives the Chinese bootleg market. In short, if Westerners want the Chinese to stop making knock-off goods, then Westerners should stop buying knock-off goods from the Chinese.



The Chinese paradox

China and the Chinese are complicated and the Silk Market paradox is only one example of this. It is one of the things that fascinates me, this sense that they have all these layers, that in order to understand them, I would have to be willing to peel back each layer, like an onion, and that maybe all I will get for my troubles are a couple of teary, red eyes. On the surface, they appear to embody the Confucian ideal. They seem modest, unassuming, tranquil and cooperative (except of course if you have the audacity to go to the Silk Market and insult the salesperson by bargaining like a cheapskate American, in which case you will get cussed out in English, for sure.) But what you see is not necessarily what you get. Beneath the exterior are people who are, among other things, extremely proud, relentless, long-suffering, cunning and tough.

You almost can’t blame them for being the way they are. Right before the fall of the Qing Dynasty the Emperor had signed the Treaty of Nanjing, an embarrassingly unfair treaty that left China at the mercy of the British, following the First Opium War. The agreement forced China to cede territory like Hong Kong to the British, pay indemnity and open their ports to foreign trade, while the British were obligated to do absolutely nothing. Plus, the Chinese didn't even have control of their courts. The Brits did not think them civilized enough to adjudicate matters that might implicate European parties. So China was also subjected to extra-territorial jurisdiction as a result of the Treaty, meaning that if there was a legal dispute, a court in England would adjudicate it, rather than a court in China. Professor Chenglin Liu who taught a course on Chinese legal history called it “a great humiliation” for China.

Humiliation can be a great motivator, apparently. Nobody knows that better than the people of China. Led by Sun Yatsen, the Chinese people rebelled against dynastic rule in 1911 and toppled the last Qing dynasty. Not long after the demise of Empress Dowager Cixi (the former concubine who ruled from behind the curtain) the last Qing Emperor was forced to abdicate the throne, circa 1912. A great period of chaos and turbulence followed. However, from the Long March to the Great Leap Forward, to the Japanese Invasion, to the Civil War to the Cultural Revolution and land reform, China and its people have been quietly and unobtrusively making their comeback. It would be a long way from humiliation to redemption and respect. But today, nobody can deny that the Chinese have the attention and respect of the entire world – even if that respect might be grudgingly conceded at times.
Deng Xiaoping was instrumental in helping China become the economic heavy-hitter it is today, starting in 1978, with his theories of economic/land reforms and modernization. To observe the Chinese from a safe distance as I often did, is to realize that they have an unspoken pact: We fell together and we will rise together. Using Dengism, Maoism, Confucianism and a whole bunch of other “isms,” they have literally collectivized their approach to the comeback. As a result, China, in an astonishing short span of time, since 1978, has risen to the second largest economy in the world. In fact, China's economy, which is currently approximately $5 trillion, is predicted to outpace the United States' economy, currently the number one economy in the world at $14-$16 trillion, in about a decade.

How did they do it? They did it collectively using “five year plans” – a brilliant strategy used by the Communist Party to set goals and achieve economic, social and cultural growth. But they also did it by stealth. The Chinese didn't exactly take a bull-horn and make threats and promises they couldn't follow through on. Not these people. These folks are like Navy Seals in stealth jets. You don't see them coming. You don't hear them coming. But they are coming and if you are not careful, they are going to take you down. While we in the West laugh at their halting attempts to speak English, and mock them for being copycats and bootleggers, and disdain their legal system, and wink while we think we "exploit" them for the cheap labor they provide our corporations, the Chinese realize that the joke is on us and so they keep working quietly to make sure that when they are done ALL roads will lead to China.

Hillary Clinton famously asked, "how do you deal toughly with your banker?" when China was accused of manipulating its currencies and engaging in unfair trade. She is right. How do you? If China is a lion, America, right now, is a gazelle; and the lion has his teeth in the neck of its prey. China relishes this. But they are too smart to brag. China's secret goal is to make sure that when they reach their apex, they will be the banker of the entire world. Right now, China's economy is described as a "market economy with Chinese characteristics." In a little bit, the world economy will be described in exactly the same way: as a global economy with Chinese characteristics. The trouble is most people are oblivious. They fail to understand the serious threat China poses to the hegemony of the United States. They pay little attention and revel in a false sense of security and “exceptionalism.” This is good for China. It gives China a whole lot of room to pull off the coup. Notwithstanding the economic interdependence of the world, China is very much an economic behemoth and its power and influence is growing every day. However, make no mistake: China's aim is not to be just a superpower; it is to be the superpower. China’s quiet aim is to eclipse the United States as the world’s most powerful nation. That is the coffee that everybody needs to wake up and smell.

You see this ambition in everything they do. First of all, they know how to pick their battles. They refuse to involve themselves and their resources into a lot of the expensive military skirmishes that other nations seem to relish getting themselves into without thinking the consequences all the way through. This is good for China’s bottom line. You also see this ambition in the importance they place on their manufacturing sector. It is by design, not happenstance, that everything is MADE IN CHINA. In addition, the Chinese really value education; there is a discernible discipline in the young people. In addition, you see the ambition in the structure of their government. The Chinese lack, for example, the checks and balances we have come to accept as the norm for how a government should work. China does not have our type of government. China calls itself a "democratic dictatorship." Whatever this patois means (and the jury is out on that question) you are not going to find the Chinese government bogged down by partisan politics and congressional deadlocks when it comes to making governmental policy. Sure, they have a State Council and they have a National People's Congress and they have various levels in their government, and so it’s not like it’s a “rule by man” as it used to be in the days of the Emperors. But at the end of the day, when something has to get done, there will be no bickering about it. The decision will be made and it will be made expeditiously and there will be consensus because that's just how they roll.

We may dismiss this approach as paternalistic, autocratic and undemocratic. We may accuse them of disdaining "individual rights." We may even say they are guilty of "human rights" abuses. Maybe all of the above is true and maybe the Chinese have some work to do, yet, on several fronts. Still, their form of government and the way the country is run is what has enabled the Chinese people to quickly make up for lost time and catapult China to the second most powerful economy in the world, in less than forty years. Seems to me that something about their system works; it is hardly perfect, but it sure is effective and maybe we in the West ought to take a look at their playbook to see if maybe there is something we can learn.

Chinese Lessons

One day, as I was standing on the Great Wall of China looking over at the mountainous terrain of what used to be Mongolia, I realized that in order to survive, in order to live to fight another day, sometimes you literally need to wall the enemy out as the Chinese did when they built the Great Wall starting in the 5th Century B.C. to keep out the Mongolians. That is, “if you can’t beat ‘em, wall ‘em out.” That’s lesson number one.
The other big lesson I learned is the importance of planning and strategizing to accomplish goals. That is exactly what worked for China when they started making “five year plans.” I think this approach is good for more than just governments; it is also a smart way to achieve personal goals. That is, set measurable goals, write them down, know your benchmark, measure growth, make changes and adjustments as needed, get everybody on board (collective action is powerful action), repeat.

Speaking of collective action, that’s another lesson from the Chinese. A collectivized approach to problem solving, putting aside differences and the ability to reach an expedient consensus are very powerful strategies for turning a bad situation around, quickly. Just don’t tell that the folks in nation’s Capital.
From their way of life, I learned the importance of living harmoniously and benevolently. President Hu Jintao’s quest for a “harmonious society” reminds me that the secret to “harmony” is having good relationships with family and friends, maintaining your health, drinking tea, and a host of other simple things.

Finally, there is the issue of allowing others to “humiliate” you by divesting you of what is rightfully yours and being utterly unable to fight back. What I think I learned from the Chinese is, first, try not to get taken to begin with because sometimes it’s impossible your stuff back when you allow people to divest you of them. Plus, if you allow them, people will take everything -- all your Earthly possessions, including: your home, your land, your country, your palaces, your priceless art, your oil wells, your diamonds, your children, your dignity, your freedom, even your good name. That said, if you do get taken, in spite of your best efforts not to be, don’t say a word. That’s the Chinese way. Instead, quietly and stealthily plot your comeback….And don’t stop till they’re on their knees begging for mercy.

Thursday, May 5, 2011

Under-valued Yuan, trade deficits, counterfeiting, etc. all amount to major friction between the U.S. and China

Is China a currency manipulator? Many argue yes. And that may give the rising superpower a trade advantage. A big one. A recent Reuters article opines that the trade deficit between the United States and China is well over $250 billion.

China, until recently had pegged it's Yuan to the U.S. dollar and had under-valued its currency, giving Chinese exporters a trade advantage, according to many trade/economic experts. Many criticize President Obama for not being tougher on China by forcing China to properly value its currency, or by assessing tariffs on Chinese imports that would then make comparable American goods more appealing to consumers. President Obama has indicated he prefers to deal more diplomatically with China rather than try to strong-arm them, according to a recent Reuters report.

The same report points out that U.S. debt levels are a concern for China, especially because China holds billions of dollars worth of U.S treasuries.

Piracy and counterfeiting of American goods by Chinese manufacturers is an enormous concern. Much of the Chinese economic rise rests on the laurels of American companies like Microsoft whose software products are routinely bootlegged; and on other American companies' goods that include but are not limited to DVDs, handbags and shoes. The Chinese government has promised to implement tougher controls.

We'll just have to see how that goes. Read more.

Wednesday, May 4, 2011

China biggest importer of U.S. goods (they especially like American "waste and scrap")

The New York Times ran an article last month that should be encouraging to American economists, and to the White House, and to Americans generally. It seems that China is the biggest importer of American made products and the Chinese's thirst for good ole Made in the USA is good for our GDP. According to the article, As China Grows, So Does Its Appetite for American-Made Products the states enjoying the biggest impact of this phenomenon are Texas, California and Washington. They export aircraft and computer components to China. (And the author seems to think that China will surpass the U.S. as the biggest importer in the world. China is now the second biggest and the U.S. is the biggest.)

Feeding billions of people is also taking a toll on China's agriculture sector. Apparently they are not making any more land so they also import huge quantities of food products from America like grain. They also need a lot of our cotton.

But it was what the Chinese import from New York that is fascinating. According to the article, New York exported nearly a billion dollars in "waste and scrap" to China last year. China apparently recycles these products to make paper and other merchandise.

That is why I think Donald Trump is massively uninformed about these trade issues and his plans for dealing with China. It will upset the balance of trade in such a way, that the jury is out who will suffer more: China or the U.S. I mean, I am sure, if they must, the Chinese can import their waste and scrap from someplace else. And where would New York sell a billion dollars worth of the stuff if the Chinese pull the account due to high tariffs on their exports to the U.S.?

Sunday, May 1, 2011

China, China, China

It's all about China these days whether the subject is human rights or trade. This superpower is such a force to be reckoned with, that U.S. presidential "carnival barker" Donald Trump promises to make the country a major focus of his campaign. Mr. Trump promises to stick it to China in such a way that the country's economy will come tumbling down after the aggressive import taxes and tariffs he assesses on their goods.

Notably, Chinese president Hu Jintao was recently in the United States at the invitation of President Barack Obama to discuss ways that the two countries can work together on issues such as trade, the environment, human rights, energy or other ways, for the benefit of both countries. It is unclear that aggressive taxation of Chinese products will have any postive impact on the American economy or reputation. Moreover, such tactics could get the U.S. accused of anti-dumping by the World Trade Organization and the Chinese could retaliate by manipulating its currency and using other tactics that could be extremely detrimental to the United States' economy. But maybe Mr. Trump knows something that the rest of us do not on this issue. After all, he didn't become a billionaire by playing nice or playing by the rules necessarily.

Having said that, China is still the talk of the international community. Almost every U.S. leader, including New York Mayor Michael Bloomberg, has been making a point of making personal trips to China to try to drum up commerce with the Chinese that would benefit their cities and states.