Why The END Of Cheap Chinese Labor Is Near

After the suicide deaths of ten workers (and three attempted suicides), Foxconn, the world’s largest contract maker of electronics and a large producer of Apple products, said that within three months it would double the salaries of many of its assembly line workers, reports the New York Times.

By Huffington Post

Last month, nearly 2,000 Chinese workers went on strike at a Honda transmission factory in southern China. The strike eventually spread across the mainland, halting production at all four of Honda’s factories in China.

One Honda worker on strike posted a question online to his fellow workers: “Our parents have suffered from this cheap labor market and now they are getting old. Do we want to follow in the footstep of our parents?”

A new generation is shaking China’s labor landscape, according to Reuters. With the support of the Chinese government, they are demanding higher wages. And if recent weeks are any indication, companies that depend on them to mass-produce electronics, auto parts and other goods sold around the world will answer their call.

The end of cheap Chinese labor may be near. Here are some of the most telling signs:

Follow link for more photos -> http://www.huffingtonpost.com/2010/06/08/why-the-end-of-cheap-chin_n_600330.html

Beijing’s Minimum Wage

According to the Global Times, on June 6th the Beijing municipal government announced it would raise its minimum wage 20 percent to about $140 a month. Thirty provinces or municipalities have raised or will raise their minimum wage this year, the paper reports.


Cyber Evil Will Thrive Without Global Rules — Good Luck With That

Global “Rules” would probably make things easier for the bad guys instead of harder.

By Reuters

LONDON (Reuters) — The best weapon against the online thieves, spies and vandals who threaten global business and security would be international regulation of cyber space.

Luckily for them, such cooperation does not yet exist.

Better still, from a hacker’s perspective, such a goal is not a top priority for the international community, despite an outcry over hacking and censorship and disputes over cyber space pitting China and Iran against Google.

Nations are thinking too parochially about their online security to collaborate on crafting global cyber regulation, an EastWest Institute security conference heard last week.

Policy statements from governments around the world are dominated by the need to heighten national cyber defenses. As a result, too many cyber criminals are getting a free ride.

“Nations are in denial,” Indian cyber law expert Pavan Duggal told Reuters, saying national legislation was of limited use in protecting users of a borderless communications tool. “It may take a big shock of an event to wake people out of their complacency, something equal to a 9/11 in cyber space.”

With a quarter of humanity connected to the Internet, cyber crime poses a growing danger to the global economy.

The FBI tallied $264 million in losses from Internet crime reported by individuals in the United States in 2008 compared to $18 million of losses from 2001: These were probably a fraction of the losses caused to companies and government departments.

The menace extends to many sectors including control systems for manufacturing, utilities and oil refining, since many are now tied to the Internet for convenience and productivity.

A priority for regulators is to find ways of tracking down criminals across borders and ensuring they are punished, a tough task when criminals can use proxy servers to remain anonymous.

Target the Perpetrator

“We cannot postpone the debate until we are in the midst of a catastrophic cyber attack,” former U.S. Homeland Security Secretary Michael Chertoff told the conference. “We must formulate an international strategy and response to cyber attacks that parallels the traditional laws governing the land, sea, and air.”

Security experts say the ability to conduct disastrous mass cyber attacks is the preserve of some governments, well beyond the capacity of militant guerrilla groups like al Qaeda. But it cannot be assumed that international organized criminal networks, long practiced at mass online fraud and theft, are not developing an interest in gaining this ability.

“Cyber crime is a very sophisticated crime with very sophisticated players and it takes a multinational effort to make sure we can enforce the law,” Dell Services President Peter Altabef told Reuters. “Once you have identified who is at fault you really want to make sure, as a deterrent, that you can go to those jurisdictions and enforce the laws on the books.”

James Stikeleather, Dell Services Chief Technology Officer, told Reuters that tracking own criminals across borders could pose legal issues for drafters of multilateral regulation.

Giving an example, he said the more companies added the technology needed to give investigators the ability to attribute a crime, the more users’ privacy and anonymity would be reduced.

“Playing With Fire”

“Probably the sticking point among the governments will be ‘where is the appropriate level of attribution versus anonymity or privacy for what people are doing (online)’.”

Datuk Mohammed Noor Amin, chairman of the U.N.-affiliated International Multilateral Partnership Against Cyber Threats, said failure to regulate could perpetuate cyber “failed states.”

He cited impoverished countries where customers can purchase unregistered SIM cards with mobile Internet capability, giving them the ability to commit online crime such as identify theft against people in rich nations without fear of being traced.

He said it was in the interest of rich nations to help poorer countries develop the capacity to crack down on this kind of abuse, because their own citizens were being targeted.

“Governments tend to look at their self-interest. But it’s actually in their own interest to collaborate,” he said.

Altabef said the growing rate and scale of international cyber attacks threatened to undermine the trust between nations, businesses and individuals that was necessary for economies and societies to act on the basis of the common good.

Complacency was also a problem, delegates said. “Nations take for granted the Internet is going to be ‘on’ for the rest of our lives. It may not necessarily be so,” said Duggal.

“Imagine the Internet being down for two to four weeks,” he said. This would “rain disaster” on online businesses as well as transport, industry and governmental surveillance systems.

“People have realize the Internet is an integral part of every country, politically, socially and business-wise.”

“Not to focus on cyber security is playing with fire.”

(By William Maclean, Security Correspondent. Editing by Charles Dick)

Photo: Model of Britain’s famed secret eavesdropping facility known as GCHQ (Government Communications Headquarters). Courtesy Gruntzooki/Flickr

More From Reuters:

More from Wired.com


Beck says Chile easily tops U.S. in “economic freedom” rankings

Chile, an eager adapter of free-market principles in Latin America, has long been a favorite of economic conservatives. Recently, a decision by the Organization for Economic Cooperation and Development — the club of rich nations — to invite Chile to become a member has become, for many on the right, symbolic of how adhering to free-market principles can vault former Third World countries into economic affluence.

In a video blog post dated Jan. 15, 2010, conservative TV and radio host Glenn Beck championed Chile as a nation no longer “struggling with poverty,” having overcome a reputation for corruption and bureaucracy through such policies as freer labor markets and lower taxes.

In addition to citing the OECD invitation, Beck pointed to its high standing in recent international ratings of “economic freedom.”

“They ranked 71st of 72 in 1975 in a study of economic freedom in the world,” Beck said in his video blog post. “Now, in that same study, they rank third. The U.S. is ranked 17th.”

We wondered whether Chile is really that far ahead of the U.S. in “economic freedom,” so we looked at the data.

We located an editorial in Investor’s Business Daily — a leading voice for free-market capitalism — that appears to be the source of Beck’s statistic.

The editorial, published Dec. 4, 2009, was later picked up by a smattering of conservative bloggers on its way to Beck’s desk. The editorial said in part, “In the Cato Institute’s 1975 Economic Freedom of the World Report, [Chile] ranked a wretched 71 out of 72 countries evaluated. Today it’s a different country altogether. Embracing markets has made it one of the most open economies in the world, ranking third on Cato’s index, just behind Hong Kong and Singapore.” Later on, the editorial added that the United States “ranks just 17th on Cato’s 2009 Index of Economic Freedom.”

However, if you look at the 2009 Economic Freedom of the World study by Cato — a libertarian think tank in Washington — the numbers were actually different. Hong Kong and Singapore did indeed rank 1 and 2, respectively, but then came New Zealand and Switzerland before Chile at No. 5. In the No. 6 spot, behind by a fraction of a point, was the United States. So while it’s true that, by Cato’s reckoning, Chile ranked ahead of the United States, it was less of a blowout than Beck or IBD indicated.

We also looked at the two prior years’ Cato studies to make sure that Beck wasn’t simply off by a year. That wasn’t the case. In the 2008 study, Chile ranked No. 6 with the United States at 8, in a two-way tie with Australia and once again behind by a fraction of a point. And in the 2007 study, the United States actually ranked higher than Chile. The United States was tied for fifth while Chile was tied for 11th.

One of the co-authors of Cato’s 2009 study — Joshua Hall, a Beloit College economist — also confirmed to PolitiFact that the United States has never ranked as low as 17th in all the years that study has been conducted. Another co-author, James Gwartney, a Florida State University economist, confirmed that Beck was correct in saying that Chile ranked 71st out of 72 countries in 1975.

In the meantime, we also looked at whether Beck (or IBD) had mistaken the Cato study for a different report. As it happens, there are at least three other studies that attempt to rank the nations of the world based on “economic freedom” or a similar yardstick.

The Heritage Foundation, a conservative think tank in Washington, publishes an annual Index of Economic Freedom. In 2009, the United States ranked sixth in its study while Chile ranked 11th.

The World Economic Forum, a Geneva-based international organization, publishes an annual Global Competitiveness Index. Its 2009-10 ratings peg the United States at No. 2 and Chile at 30.

Finally, the World Bank publishes an annual “Doing Business” ranking that seeks to measure which countries have a regulatory environment “conducive to the operation of business.” In this tally, the United States finished fourth overall with Chile 49th.

Given these ratings, it would seem unlikley that Beck or IBD could have accidentally been referring to any of these studies.

However, we would be remiss if we failed to add that, despite the apparent flub on reporting the rankings, Beck’s overall assessment of Chile’s recent economic history is largely accurate.

We spoke with three experts on Latin American economics and politics who work with centrist-to-liberal think tanks — Julia Sweig of the Council on Foreign Relations, Andres Martinez of the New America Foundation and Leonardo Martinez-Diaz of the Brookings Institution — and they agreed that there is a broad ideological consensus on Beck’s two key points: Namely, Chile has improved its economic position in recent years and that free-market policies can take some of the credit.

“If trends continue, Chile will soon be considered one of those rare countries that has graduated out of the developing world, according to plenty of living-standard indices,” Andres Martinez said. “The country is also the poster child for those who believe globalization and free trade can lift living standards, as Chile’s economic course has long been anchored in its free-trade agreement with the U.S. and its dynamic export sector. It also stands out among South American countries in that its governing socialists have pragmatically been the ones embracing this pro-business, market-oriented economy.”

So while there is some truth to Beck’s underlying point that Chile has improved its economic freedom, he’s wrong to portray Chile as ranking far ahead of the United States. By several measures, the United States ranks significantly higher than Chile; in one, Chile is slightly ahead.

So we find his claim Barely True.


Matt Taibbi Blasts David Brooks For Haiti Column: ‘Wait Until After The Bodies Were Cold’

Matt Taibbi

Translating David Brooks

A friend of mine sent a link to Sunday’s David Brooks column on Haiti, a genuinely beautiful piece of occasional literature. Not many writers would have the courage to use a tragic event like a 50,000-fatality earthquake to volubly address the problem of nonwhite laziness and why it sometimes makes natural disasters seem timely, but then again, David Brooks isn’t just any writer.
Rather than go through the Brooks piece line by line, I figured I’d just excerpt a few bits here and there and provide the Cliff’s Notes translation at the end. It’s really sort of a masterpiece of cultural signaling — if you live anywhere between 59th st and about 105th, you can hear the between-the-lines messages with dog-whistle clarity.  Some examples:

This is not a natural disaster story. This is a poverty story. It’s a story about poorly constructed buildings, bad infrastructure and terrible public services. On Thursday, President Obama told the people of Haiti: “You will not be forsaken; you will not be forgotten.” If he is going to remain faithful to that vow then he is going to have to use this tragedy as an occasion to rethink our approach to global poverty. He’s going to have to acknowledge a few difficult truths.
The first of those truths is that we don’t know how to use aid to reduce poverty. Over the past few decades, the world has spent trillions of dollars to generate growth in the developing world. The countries that have not received much aid, like China, have seen tremendous growth and tremendous poverty reductions. The countries that have received aid, like Haiti, have not.
In the recent anthology “What Works in Development?,” a group of economists try to sort out what we’ve learned. The picture is grim. There are no policy levers that consistently correlate to increased growth. There is nearly zero correlation between how a developing economy does one decade and how it does the next. There is no consistently proven way to reduce corruption. Even improving governing institutions doesn’t seem to produce the expected results.
The chastened tone of these essays is captured by the economist Abhijit Banerjee: “It is not clear to us that the best way to get growth is to do growth policy of any form. Perhaps making growth happen is ultimately beyond our control.”

TRANSLATION: Don’t bother giving any money, it doesn’t do any good. And feeling guilty about not giving money doesn’t do anyone any good either. In fact, you’re probably helping by not doing anything.

The second hard truth is that micro-aid is vital but insufficient. Given the failures of macrodevelopment, aid organizations often focus on microprojects. More than 10,000 organizations perform missions of this sort in Haiti. By some estimates, Haiti has more nongovernmental organizations per capita than any other place on earth. They are doing the Lord’s work, especially these days, but even a blizzard of these efforts does not seem to add up to comprehensive change.

TRANSLATION: I, David Brooks, am doing my Christian best right here at home. Look, I even used a capital “L” in the word “Lord.” And I wrote that thing about Obama’s Christian Realism a few weeks ago. So I‘m doing my part. Of course I’d volunteer to help, but intellectually I just don’t think volunteering really helps. I mean, there are studies and everything.

Third, it is time to put the thorny issue of culture at the center of efforts to tackle global poverty. Why is Haiti so poor? Well, it has a history of oppression, slavery and colonialism. But so does Barbados, and Barbados is doing pretty well. Haiti has endured ruthless dictators, corruption and foreign invasions. But so has the Dominican Republic, and the D.R. is in much better shape. Haiti and the Dominican Republic share the same island and the same basic environment, yet the border between the two societies offers one of the starkest contrasts on earth — with trees and progress on one side, and deforestation and poverty and early death on the other.
As Lawrence E. Harrison explained in his book “The Central Liberal Truth,” Haiti, like most of the world’s poorest nations, suffers from a complex web of progress-resistant cultural influences. There is the influence of the voodoo religion, which spreads the message that life is capricious and planning futile. There are high levels of social mistrust. Responsibility is often not internalized. Child-rearing practices often involve neglect in the early years and harsh retribution when kids hit 9 or 10.
We’re all supposed to politely respect each other’s cultures. But some cultures are more progress-resistant than others, and a horrible tragedy was just exacerbated by one of them.

TRANSLATION: Although it is true that Haiti was just like five minutes ago a victim of a random earthquake that killed tens of thousands of people, I’m going to skip right past the fake mourning period and point out that Haitians are a bunch of lazy niggers who can’t keep their dongs in their pants and probably wouldn’t be pancaked under fifty tons of rubble if they had spent a little more time over the years listening to the clarion call of white progress, and learning to use a freaking T-square, instead of singing and dancing and dabbling in not-entirely-Christian religions and making babies all the fucking time. I know I’m supposed to respect other cultures and keep my mouth shut about this stuff, but my penis is only four and a third inches long when fully engorged and so I’m kind of at the end of my patience just generally, especially when it comes to “progress-resistant” cultures.

Fourth, it’s time to promote locally led paternalism. In this country, we first tried to tackle poverty by throwing money at it, just as we did abroad. Then we tried microcommunity efforts, just as we did abroad. But the programs that really work involve intrusive paternalism.
These programs, like the Harlem Children’s Zone and the No Excuses schools, are led by people who figure they don’t understand all the factors that have contributed to poverty, but they don’t care. They are going to replace parts of the local culture with a highly demanding, highly intensive culture of achievement — involving everything from new child-rearing practices to stricter schools to better job performance.
It’s time to take that approach abroad, too. It’s time to find self-confident local leaders who will create No Excuses countercultures in places like Haiti, surrounding people — maybe just in a neighborhood or a school — with middle-class assumptions, an achievement ethos and tough, measurable demands.
The late political scientist Samuel P. Huntington used to acknowledge that cultural change is hard, but cultures do change after major traumas. This earthquake is certainly a trauma. The only question is whether the outside world continues with the same old, same old.

TRANSLATION: The best thing we can do for the Haitians is let them deal with the earthquake all by themselves and wallow in their own filth and shitty engineering so they can come face to face with how achievement-oriented and middle-class they aren’t. Then when it’s all over we can come in and institute a program making the survivors earn the right to keep their kids by opening their own Checkers’ franchises and completing Associate’s Degrees in marketing at the online University of Phoenix. Maybe then they’ll learn the No Excuses attitude real life demands, so the next time something like this happens they won’t be pulling this “woe is us” act and bawling their fucking eyes out on CNN while begging for fresh water and band-aids and other handouts. Maybe that will happen, or maybe we’ll just keep sending money, fools that we are, so that they can keep making more of those illiterate ambitionless babies we’ll have to pull out of the next disaster wreckage.

p.s. Did I miss anything? Because I think that’s pretty much it. One would have thought a column on the Haitian’s lack of an achievement culture could maybe wait until after the bodies were cold, but… hey, who am I to judge?

p.p.s. I’ve got to put this comment up on the main piece, since so many people seem to have missed my point.

Again, unlike Brooks, I actually lived in the Third World for ten years and I admit it — I’m not exactly in the habit of sending checks to Abkhazian refugees, mainly because I’m not interested in buying some local Russian gangster a new Suzuki Samurai to tool around Sochi in. And I’ve actually seen what happens to the money people think they’re giving to Russian orphanages goes, so no dice there, either.

But you know what? Next time there’s an earthquake in Russia or Georgia, I’m probably going to wait at least until they’re finished pulling the bodies of dead children out of the rubble before I start writing articles blasting a foreign people for being corrupt, lazy drunks with an unsatisfactorily pervasive achievement culture whose child-rearing responsibilities might have to be yanked from them by with-it Whitey for their own good.

An earthquake is nobody’s fault. There’s nothing to do after a deadly earthquake but express remorse and feel sorry. It’s certainly not the time to scoff at all the victim country’s bastard children and put it out there on the Times editorial page that if these goddamned peasants don’t get their act together after a disaster this big, it might just be necessary to start swinging the big stick of Paternalism at them.

I mean, shit, that’s what Brooks is doing here — that last part of the piece is basically a threat, he’s saying that Haiti might have to be FORCED to adopt “middle-class assumptions” and an “achievement ethos” because they’re clearly incapable of Americanizing themselves at a high enough rate of speed to please Brooks. That’s this guy’s immediate reaction to 50,000 people crushed to death in an earthquake. Metaphorically speaking, he’s standing over the rubble and telling the people trapped under there that they need more of a “No Excuses” culture, which is insane on many different levels.

Brooks’s implication that the Haitians wouldn’t have died in such great numbers had they been Americans is the kind of thing that is going to come back to bite us the next time we have a nuclear accident or a hurricane disaster or a 9/11 and we’re looking to the rest of the world for sympathy and understanding.