Hazard of Sourcing to China 9

[plasgears]

At this point we have had long experience with sourcing to China, and my experience has been negative for the most part. It caused the downfall of my company in an automotive disaster. When Ford mandated a 10% cost reduction, we passed the reqt to our supplier. He promptly sourced plastic material from China. The source and material were not qualified; so much for QS9000.

Why is China such as economical place to get parts made? This warrants in-depth study and intelligence. Some have described the Chinese economy as a 'false' economy. My theory is that oil money from our enemies is undermining American economy by priming China to sell very low to us. The result has been closed enterprises, jobs lost, and spiraling disasters in the housing market and Wall St. Recent visitors to China report that the Chinese revel in these outcomes. If this scenario is true, what an ingenious plan our enemies have plotted to destroy us. Who would have anticipated it.

China doesn't care about our specifications; we should not care about China and their practices. We should withdraw and study what is going on under the surface. It has been confirmed that Chinese are brought down from the western mountains, and they are put to work on our parts. This doesn't fully explain the very low pricing.

We are now hearing American businessmen expressing regrets about associating their production with China. Realization of what it means to do business in China is rising. When Detroit, in response to union demands years ago, expressed that car business would heretofore become international, most didn't anticipate the full import of that statement. We will have to wake up before it is too late.

 

[escrowe]

I consider that the US does not really encourage the development of industry-- only 20% of the US work force is engaged in 'making things' and that percentage is falling. We no longer tolerate 'dirty' industries, and our definition of 'dirty' continues to expand. Within a very few decades, coal-fired power plants will become a rarity. IMO, we're perfectly willing to manufacture overseas, since that fits our avowed national priorities of 'clean and green.'

 

[PBroad]

When one spends $10,000,000,000/day on an off-shore army made up to a large extent of reserve soldiers who are thus removed from the workplace will throw any economy for a loop. To retain that economy at the expense of its trading partners will throw the world finances into a loop.

As regards getting ones hands dirty I believe in the old adage "Where there's much there's brass! And No Canadians are not liberal Americans, but are the first to suffer when US agrees to Free Trade then imposes trade tarifs!

 

[jmw]

Escrowe,
how does exchanging dirty manufacturing in the US for dirty manufacturing in China or elsewhere do anything for the environment?
If anything, manufacturing ought to be done in an environmentally sensitive country because that is where the controls are likely to be more effective.




JMW

http://www.ViscoAnalyser.com

 

[KENAT]

It think that was his unstated point JMW. Instead of becoming 'green' by cleaning up processes, becoming green by exporting the dirty processes is just paying lip service.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

 

[escrowe]

Yes KENAT.

jmw, given the chance, companies will flee expensive controls whenever possible, whether in the form of taxes, QA/QC or environmental regs. Economic nature of the beast. Those companies that tolerate the controls do so for some other reward.

Since 2/3rds of the US economy is essentially based on wholesale, retail, transport, (i.e. consumption), raising tariffs to control quality or manufacturing standards of foreign goods is simply not in the general US economic interest. Although some industries certainly do get special treatment.

 

[jmw]

That being the nature of the beast, it devolves the responsibility on government which acts (supposedly) for the people to regulate in respect of the environment rather than rely on the "self regulation" of industry which acts for the shareholders.

JMW

http://www.ViscoAnalyser.com

 

[IRstuff]

That's because there's NEVER been any self-regulation, since it's ALWAYS cheaper to ignore all the bad things:
child labor
groundwater contamination
sweatshop conditions
contaminated production (until they get caught)

The shareholders don't care about that sort of thing; it's profits and dividends that count for most of them. There are some mutual funds geared for "green" investors investing in "green" companies, but it's a relatively minor chunk of the investment world.

TTFN

FAQ731-376

 

[thruthefence]

Here is an saying:

"It's always better to ask for forgiveness then permission"

 

[lz5pl]

thruthefence nice saying! Never heard it, but I am fully agree !

------------------------
It may be like this in theory and practice, but in real life it is completely different.
The favourite sentence of my army sergeant

 

[drawoh]

thruthefence,

"It's always better to ask for forgiveness then permission"

I am sorry I put melamine in your baby's formula. I will try to refrain from doing it again.

JHG

 

[vc66]

Point, drawoh.

V

 

[GregLocock]

Good catch, I think the quote is usually given as "It is easier to ask for forgiveness than permission"... not the same thing at all.


Cheers

Greg Locock

SIGlease see FAQ731-376 for tips on how to make the best use of Eng-Tips.

 

[thruthefence]

Maybe it should be amended to say:

"It is easier to ask for forgiveness while having attorneys and PR people on staff than permission"

a sad state of affairs, indeed.

 

[IRstuff]

One has to presume that what one is asking forgiveness for is actually forgivable. We're engineers, we're supposed to think past the first level.

TTFN

FAQ731-376

 

[thruthefence]

Remember this?

http://www.fordpinto.com/blowup.htm

 

[escrowe]

Your QA/QC is abominable, said Mr. Pot to Mr. Kettle.

 

[drawoh]

GregLocock,

As far as I know, the quote is correctly rendered by thruthefence. I have heard it a few times where I work. It is a valid concept in a discussion about getting things done. If you take the initiative, sometimes you will have to ask for forgiveness.

This discussion is about taking risks to save money, a completely different context in which the quote is irrelevant, if not dangerously wrong.

JHG

 

[escrowe]

Yes, a concept better applied to the environmental permitting process, IMHO.
Oh dear, that comment may qualify as heresy in some quarters.

 

[KENAT]

Greg's version of the quote is what I've heard, and live by;-).

I wonder what effect Tariffs based on equality of various types of legislation would have?

I believe most previous/existing Tariffs were just based on the fact it was imported/imported from a specific country or region, without much if any regard to the above.

This usually led to counter Tariffs which I believe had the 'unintended consequence' of effectively being a tax on most international trade and causing a drop in this with resultant effects on the economy.

However, if the Tariffs were strictly based on general equivalency of legislation/regulation in specific areas such as workers rights/Health & Safety, environmental issues, animal welfare etc. would the same happen with counter tariffs?

Or would it perhaps lead to harmonization of some of these regulations across countries? (I know this has happened to some extent within the EU and similar regional agreements, which some may not like, one world government and all that.)

The poorest nations could be excused from the Tariffs/given lower rates for a certain period of time and there’d have to be measures to prevent just routing products through exempt countries etc.

I know this is/can be done by considering these factors in individual free trade agreements but perhaps a more widespread approach would be more consistent?

Also, some of the revenue raised could be used to help enforce safety standards on imported items and potentially even IP, though this is mostly a civil matter.

While the ‘fair tax’ type initiative of moving more taxation to sales tax instead of income & corporation is in part proposed to help balance against imports, as items are equally taxed whether imported or made locally, direct taxes aren’t the only difference so it doesn’t directly address the differences in regulation/legislation mentioned above.

Just thinking out load, haven’t really thought it through and am not an economist, so someone go ahead and pick it apart.


KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

 

[IRstuff]

Tariffs and protectionism have the bad consequence that the protected industries get fat and lazy and uncompetitive. Additionally, it tends to make them hunker down in the marketplace, by retreating from those markets they have difficulty competing in, because they have become so complacent from the protectionism.

The downside, obviously, is that some companies are completely unable to compete effectively, regardless, ala, the US Big 3.

TTFN

FAQ731-376