You’re exaggerating slightly, though. All big shops are open 6 days a week until 8 pm (so it’s simply not true that on a Saturday at 5 pm the shops are closed. Just the mum and pop stores off Schwanthalerstrasse). And Bavaria is the only German Land that still requires shops to close by 8 pm. In most other parts of Germany, shops may be open 24 hours if they so choose, with the only exception of Sunday.

Anyway, more to the general point: Maybe China is more hungry because it is still relatively poor. And maybe Germany and other European countries are less hungry because they still don’t need to be, because things are going reasonably well. As of now, no economic indicators seem to indicate that China is indeed crushing Europe. China is growing much faster, but so what? China as a whole is still dirt poor, so it’s quite natural that it is growing fast. As for China being so dirt cheap that it is impossible to compete with it: I can immediately think of some recent examples where hiring a qualified employee in Shanghai involved a salary quite similar to hiring an equally qualified person in Germany.

May 28, 2007 @ 9:22 pm | Comment

“And meanwhile, China is shaking the world”

Maybe so… maybe not…
Then, Richard, I will send you in the direction of the ongoing debate with James Mann and David Lampton about China’s future role in the world. We can all draw our own conclusions. I’m not sure where I stand as of yet…

http://tinyurl.com/2vtxme

May 28, 2007 @ 9:26 pm | Comment

Excellent post. I was in Germany about a month ago and had exactly the same feelings, and when i returned to England from China last year i had similar thoughts then, as well. You’ve put this into words very well, far better than i could.

However, what has inspired me to comment is that I think you are using your experiences with the pen and cable as a metaphor for something far bigger: eg the relationship between the Chinese system and the west european one, and this is ultimately an inaccurate one.

Because, for every chinese entrepeneur on the street corner on CNY, there is a bankrupt SOE still in business, and restaurants with a staff to customer ratio of 20:1. Did you see the thousands of windfarms scattered over the bavarian landscape as you flew in? Whilst China opens a new coal powr plant every other week, Germany has become a leading innovator in environmental technologies. Which is the more sustainable approach to power generation in the 21st century?

Of course, the fact that china will probably just blatantly copy this technology when it suits should be beside the point…

Is the book you are reading ‘the writing on the wall’ by will hutton?

May 28, 2007 @ 9:37 pm | Comment

“I believe in universal healthcare and unions and workers’ rights. But I also believe in competitiveness and pragmatism.”

I totally dig this contradictory feeling – I honestly don’t know what to believe in anymore…perhaps some awkward compromise, like working very competitively 25 hours a week…

It’s a bank holiday in England today and I can’t stand them – I can’t think of anyone less deserving of a holiday than a bank. Gah.

May 28, 2007 @ 10:08 pm | Comment

Thomas, I don’t think I’m exaggerating – even the huge Kaufhofs are locked up today, as they were yesterday. If there were places at 8pm on Saturday where I could have bought my cable, they did a great job of making them hard to find.

Canrun, when I write about the book I reference, I’ll address the points you make, which are fair. China is shaking the world. That is a fact. Whether it’s success is sustainable is another story, as is the question of whether they will succeed. What is not debatable, however, is my central point, that much of Europe has fallen back into a state of non-competitiveness, a situation that led to the election results in France a week ago. It simply has to change.

Neil, same as what I said to canrun – China’s formula for the “economic miracle” is deeply flawed and may well fail. Germany is crushed by its welfare state, and China is similarly crushed by its own version of welfare (like the SOEs). However, the loss of jobs and factories in Germany and elsewhere is a matter of fact, and the philosophical attitude of many of the people here coupled with a stubborn resistance to any changes that would weaken the welfare system are not the solutions.

May 28, 2007 @ 10:12 pm | Comment

One last thing, to Thomas’ point: As for China being so dirt cheap that it is impossible to compete with it: I can immediately think of some recent examples where hiring a qualified employee in Shanghai involved a salary quite similar to hiring an equally qualified person in Germany.

Compare the wages of workers in textile factories in Italy with those along the Pearl River Delta. These workers slave for 12 hours and more a day at a tiny fraction of the cost and with no benefits. White collar workers in China are doing better, but the competition isn’t coming mainly from them, rather from China’s huge labor pool. If there were that many truly skilled and well educated white collar workers in China I may be more worried about them, but for now they do not pose a huge threat to their counterparts in the deveoped nation the way the factory workers do. Of more concern perhaps is India’s white collar workers, many of whom can seriously compete with America’s.

May 28, 2007 @ 10:20 pm | Comment

“China is shaking the world”?

Maybe that “shaking” is due to muscle and stomach spasms from the various toxins in your “made in china” food.

May 28, 2007 @ 10:23 pm | Comment

Richard,

one other thing i would say you should factor in in your analysis is the prospect of ‘global levelling’. If there was a more level playing field in terms of the value of different currencies, then Germany would be in a better position to compete with China. Lets see how long the teachers 25 hour weeks and SOEs adapt to this…

However, my guess is the protective tariffs will appear long before this becomes a reality. Far too much is at stake, politically, on both sides.

May 28, 2007 @ 10:53 pm | Comment

Neil, agreed. China’s “competitiveness” is not based on an equal playing field, very far from it! Subsidies, a controlled currency, outrageous restrictions on foreign companies trying to do buisiness in China…no, fairness has nothing to do with it.

Kebab boy (nanhe) you are really starting to bug me and if you don’t cut the shit I’m going to cut off your platform. I’ve been very obliging of your nonsense and your loathing of all things China, knowing everyone thinks of you as a true idiot, but I’m feeling less nice today. Shape up or disappear, okay?

May 28, 2007 @ 11:08 pm | Comment

Nanhe is a very confusing guy…if one goes through his various posts from different places on the ‘Net one finds both a flame-throwing goof ball at times and a very thoughtful and well-informed person of conviction at others. I hope he’ll stick to the latter here. Save the bad, bad China stuff for the Time blog, ok man?

May 28, 2007 @ 11:25 pm | Comment

canrun, I used to have some respect for him, but this is as despicable as the guy there the other day who cursed out America as the root of all evil. I have no patience for nonsense and racism, or whatever we want to call it.

May 28, 2007 @ 11:37 pm | Comment

“…the old European welfare state, with its promise of a 35-hour work week and lots of state-provided benefits simply cannot survive in today’s globalized world. Not when China is heading straight at them, shaking the foundations of their existence and driving them increasingly into irrelevance.”

The only reason the world is struggling to compete is due to the grossly unfair workplace practices common in China. Such practices are more closely associated with serfdom than human progress.

If the alternative is China’s punitive, exploitative, look-down-upon the worker approach, then we better all hope “the old European welfare state” does survive.

On a side note, I’ve great respect for Germany. They stand on principle more than most, as demonstrated with the recent scolding the German parliament gave to China when passing a motion condemning the use of so-called ‘laogai’ labour camps. This despite the usual tantrums thrown by Chinese ‘diplomats’ and veiled threats of repercussions. Fatherland 1 Motherland 0.

@ Charlie:

Back in England already? I advise you to get back here ASAP. China needs you.

May 28, 2007 @ 11:48 pm | Comment

Richard, We can all have our opinions about the European welfare state, but I think you are jumping at the wrong conclusions. As a European, I can tell you a number of anecdotes about how incredibly inefficient the US can be compared to Europe.

As regards the rise of China, the reason why Europe can afford the welfare state, long holidays and high wages is that European workers are more efficient than Chinese workers. When I worked at a European institution in Beijing some time ago, I was shocked to find that it was cheaper for the company to fly in two European workers to rejig the electric wiring in the building, than to employ a dozen local workers to do the same job. Chinese workers are simply not as productive as European workers, but as they become more competitive, their wages will rise.

Despite all the gloom-and-doom predictions of the US press, Europe is doing remarkably well. Universal health care may be expensive, but the US health care system is much more expensive. US companies like General Motors or Ford are crushed under the burden of providing health care and pensions for their employees. France, the whipping-boy of US media, has one of the best and most health care systems in Europe.

As for economic performance, Sweden, the most “socialist” country in Europe now has a GDP growth rate of 4.3 per cent, whereas “capitalist” US has a sluggish 2.1. Inflation is 1.6 per cent in Sweden, while US inflation is 2.6. Only unemployment is higher in Sweden, but not than much, with 4.8 of the workforce unemployed in Sweden compared to 4.6 in the US.

May 28, 2007 @ 11:52 pm | Comment

Richard, We can all have our opinions about the European welfare state, but I think you are jumping at the wrong conclusions. As a European, I can tell you a number of anecdotes about how incredibly inefficient the US can be compared to Europe.

As regards the rise of China, the reason why Europe can afford the welfare state, long holidays and high wages is that European workers are more efficient than Chinese workers. When I worked at a European institution in Beijing some time ago, I was shocked to find that it was cheaper for the company to fly in two European workers to rejig the electric wiring in the building, than to employ a dozen local workers to do the same job. Chinese workers are simply not as productive as European workers, but as they become more competitive, their wages will rise.

Despite all the gloom-and-doom predictions of the US press, Europe is doing remarkably well. Universal health care may be expensive, but the US health care system is much more expensive. US companies like General Motors or Ford are crushed under the burden of providing health care and pensions for their employees. France, the whipping-boy of US media, has one of the best and most health care systems in Europe.

As for economic performance, Sweden, the most “socialist” country in Europe now has a GDP growth rate of 4.3 per cent, whereas “capitalist” US has a sluggish 2.1. Inflation is 1.6 per cent in Sweden, while US inflation is 2.6. Only unemployment is higher in Sweden, but not than much, with 4.8 of the workforce unemployed in Sweden compared to 4.6 in the US.

May 28, 2007 @ 11:53 pm | Comment

Bad luck Richard. It’s Pentecost and you are in the most catholic German state so perhaps that’s why they closed so early on Saturday. Actually Bavaria has the most public holidays of all the German states but it is also the most prosperous state. So it’s not as easy as to say few holiday days equal a good economy. One could also say that an employee with enough time to relax will work more productive.

Your are right the welfare state is in a crisis. Though I am not as pessimistic as to say China will crush the European model. Germany has seen a lot of reforms in the last years with the result that the German economy is gathering way again after years of stagnation. I don’t see the end of the European model. It has to change. The welfare state has to become slimmer and more efficient. And especially what concerns the healthcare system and the pension system there remains a lot to be done.

I also see the problems with too much regulation and state-intervention. Too often services organized by the state are inefficient and hinder economic development. But what is the alternative? 15% of the population without healthcare like in the US? Not very desirable from my point of view, and a sure formula for a radicalization in politics. One has to bear in mind that Germans and other Europeans are used to a model of welfare since 100 years. You can’t change that mentality in one year ot two, especially if one quarter of the people come from a socialist state.

And in the German case you can’t often enough remind people, that there was the monumental task of the reunion. 16 million people wanted to live as prosperous as their compatriots in the West from one day to the other while their economy was totally rotten. A lot of the economic problems Germany had in the last years still stem from that cause.

So it’s right to say the welfare state has to reform. But please don’t bury it that quickly there is hope for recovery.

May 28, 2007 @ 11:55 pm | Comment

Concerning shop-opening hours: Not that it’s of any use to you now, but I really don’t know why you were unable to find an open shop at 5 pm: In the main shopping area (basically all the roads fanning out from Marienplatz, especially towards Hauptbahnhof), nearly every shop is open until 8 pm, and the whole area is always full of busy shoppers, too. I could immediately tell you at least half a dozen places that would have happily sold you all the equipment you wanted at 7:58 pm. But not yesterday or today, that’s true.

Anyway, the shop opening thing might also be due to shoppers’ preferences: I understand that for tourists it would be convenient to be able to shop anytime, and in a big city like Munich, demand should justify shop opening on a Sunday. But for the most part, locals seem to feel no real need or desire to shop on Sundays: In the mid-sized town where I grew up, shops experimented with 8 pm opening when it was first permitted years ago. Then they realized that the shoppers didn’t come. These days, most shops in the pedestrian zone again close at 3 or 4 pm on Saturdays. And already at 2 pm, there’s hardly anybody there. Whereas the supermarkets on the outskirts open until 8 pm and do ok business. If people don’t want to shop, shops won’t open. Whereas in Shanghai or Singapore, Sunday shopping is simply part of the local culture, the fun thing to do on a boring Sunday… That’s the market economy: Shops open where there is demand, and don’t open where there is no demand.

As for Europe being competed into the ground by China’s low wages: How do you explain that for the last two years, Germany has been experiencing very solid economic growth (including an increase in manufacturing employment in export-oriented industries) and a sharp decline in unemployment? I think the low-skill manual-labor industries are long gone anyway. Of course China is slowly trying to work its way up the value chain (as it should), but the more it does so, the more it will need to develop a highly educated workforce that simply won’t be willing to work for 1,000 Yuan per month. 30 years ago, Japan was seen as destroying American and European industry by offering cheaper goods. The more successful it became, the more Japanese wages went up. Eventually, some Western industries were indeed destroyed by the Japanese competition, but that doesn’t seem to have had any detrimental impact on the US or German economies as a whole. Nowadays, nobody seems to be particularly worried about the “Japanese threat” anymore. OK, granted, China is bigger than Japan. And all sorts of things will indeed need to change over time (and are already in the process of changing), as China becomes more and more influential in this world. But if European workers continue to prefer 30 days of vacation over a somewhat higher paycheck, that is their legitimate choice. If they work less than their foreign counterparts, then (all other things being equal) they will earn a little less. If they prefer to have their shops closed on Sundays, they will enjoy a little less convenience than their foreign counterparts. And over time, Chinese workers’ salaries will slowly but surely rise and get closer and closer to German workers salaries (and if the Chinese turn out to have a stronger preference for money over leisure, then maybe their salaries will eventually pass German salaries, just like Japanese salaries did twenty ago). But that’s it, in my opinion.

May 29, 2007 @ 12:03 am | Comment

Oooops, just posted the same comment twice. To address the point of opening hours directly, I think the most striking difference when comparing US and Europen retailing, is that European shop employees may work shorter hours, but they are more knowledgeable and better educated than their US counterparts. If I go to an electronics store in Europe, I can usually find employees that are knowledgeable about the products they sell, but here in the US shop employees very quickly run out of standardized answers. Furthermore, the turnover of employees in the US is staggering and if you go to the same store regularly, you often find completely new people all the time. I am not saying one thing is necessarily better than the other, it’s more a difference of priorities. The US model provides cheap labor and long store hours, the European one employment stability and generally better service.

May 29, 2007 @ 12:14 am | Comment

It’s pretty easy to give Europe a rough ride for not being as competitive as China (or the US for that matter), but as some have already pointed out I’m not sure if this is completely a bad thing.

China’s competitiveness comes from a lot of hard work and entrepreneurialism, granted, but also equally from the ability to produce artificially cheap goods thanks to lax to non-existent environmental controls, extremely low labour standards and a state-enforcer which has enabled wild capitalism by crushing any whimpers of protest. Pretty hard to compete against as a wealthy Western liberal democracy.

For a place that is considered to be in eternal economic malaise by the more anglo-saxon side of punditry, it seems to be doing remarkably well to me. Public transportation in Western Europe is simply astounding, and makes me cry every time i come home to Canada. Europe is also at the forefront of renewable energy technologies (particularly wind), while over here everyone is still yelling about their god given right to own five SUVs.

Sure, Europe has problems (name me a place which doesn’t!), but on the grand scale of things it seems to be doing pretty ok to me. 🙂

May 29, 2007 @ 12:57 am | Comment

Richard wrote in relation to the book he is reading:

“It talked of the 25-hour workweek for teachers” in Germany.

25 hours work per week, or 25 hours of teaching per week? That is a crucial difference. It sounds like the author of this book has fallen victim to a well-cherished myth. To work as a teacher is not only teaching class; it is preparing for class, grading exams, going to meetings, planning the next semester, dealing with problem students, etc. You add these hours up, and you have a much longer working week!

May 29, 2007 @ 3:16 am | Comment

I only have one thing to say:
I don’t believe that the threaten or the competition is from China’s huge labor pool, becuase I can’t image or picture it that ‘strong’ Germany is going to be crushed by these unskilled, un-educated workers.
If one day China really become a ‘threaten’ or something similiar, that must be other reason, definitely not becuase of simple labor.
And the present China is far away to crush any country else. She is a growing child, if she goes wrong way, she might be crushed by herself problems(though the possiblity is not big).

And, please, don’t keep saying that China is going to be a threaten, there are already so many voice said so,which cuased hostile and unfriendly attitude. Pls give us a break and let us live peacefully……:-P, Kidding.

May 29, 2007 @ 3:46 am | Comment

Could be worse; you could be in Italy when everything is closed except at selected times or on the frequent holiday accorded to honour a saint. My girlfriend couldn’t believe how often things would be closed (reason today: it’s Wednesday) and was frantic on our last day (the Ascension as it was) to find coffee makers for family/friends back in China.
Of course, nothing beats Sunday in Belfast- that smell of burning car, the silence in the street, the emptiness of the roads as if no life existed; and this the day after I first had her cycle with me up the Shankill with kids playing on the road, the murals of balaclava-decked men, the tricolours and Popes being readied for burning, the Chinese restaurant we went to owned and operated by Scots-Irish. Boy, did she miss China that day!

May 29, 2007 @ 7:08 am | Comment

PS- For my part, I miss Europe- quality of life, enjoyment of life, pursuit of culture and beauty…
You think that should be sacrificed for (often) obnoxious tourists who think money is enough for people to bow and compromise their families’ raison d’etre? You’re visiting Europe, not America. Europe has had enough with ideologies advocating the sacrifice of the soul for the pursuit of national wealth be it fascism or communism.
OK, I’m arguing too much- I always hated living in small town in the south of Italy or Greece or big towns like Barcelona when one has to wait until 17.30 to shop. That’s the time shops close in England, home of Adam Smith!

May 29, 2007 @ 7:18 am | Comment

The operative fulcrum, as Richard points out, amounts to: is China’s growth, and its fallout, sustainable? I read a chilling article today in the Globe & Mail while monitoring ongoing press reports about contaminated Chinese exports. Read Rude awakining could await China at http://tinyurl.com/23fwgu

It’s conclusion:
"Short term, trade with China could fall sharply as nations suspend or stop imports, similar to what the FDA has already done with Chinese toothpaste. Such a ban might extend to other non-food or drug shipments as there been incidents of food/drug products being shipped under different names to avoid inspections.

This week, former U.S. Federal Reserve Board chairman Alan Greenspan stated that he feared a “dramatic contraction” in the Chinese stock market. Should the world event scenario I’ve painted above come to pass, his concerns about China could be quickly realized, and the entire region negatively affected.

At that point, there won’t be much discussion about an overvalued currency."

May 29, 2007 @ 8:02 am | Comment

An interesting new poll published in Newsweek magazine about the views of China and the USA vis a vis the rest of the world…

http://tinyurl.com/396mqw

May 29, 2007 @ 9:27 am | Comment

“”””””””””””Europe has had enough with ideologies advocating the sacrifice of the soul for the pursuit of national wealth be it fascism or communism.”””””””””””

OooOH Europe sounds cool ( :

it seems to me… That if Chinas slave driving, population killing CCP drives other countries to either become CCP members and suffer absolute spiritual degeneration, or work their buts off in slave places in order to compete… if these are the two choices, I think there will be a war or something. Cause there are a lot of people who value other things before money, and they wont want to live a life of struggle for money only. So if the CCP continues to go on its exploitation rampage eating up everything in its sight… then a lot of people will fight them since life wouldnt be worth living under such a regime..

or maybe I’m wrong. I wouldve thought that people would have tried their best to get the CCP out of China already, but I guess the fact that the Chinese people are brainwashed fools others in the world too…

Keir,

i tried to go to your blog and it wouldnt work. Just thought I ought to say so.

May 29, 2007 @ 12:35 pm | Comment

naney…..

I think you are just lazy, if you believe something why dont you snap out of it and find a reason to express yourself in a way that other people will be able to accept?

I knew a guy before, he used to curse and talk about war and stuff like you… After awhile I found out that the CCP killed his family but no one he talked to would have known that cause he never mentioned it…

I know a lot of people whos families have been smashed to hell by the CCp but they dont swear so much, they just try to do the right thing…

if it makes you feel any better, ( I hope you dont actually hate China and you just hate the CCP) this evil man Bo Xilai, the Chinese Minister of Commerce has been served with a lawsuit for inciting the torture deaths of over 100 Falun Gong practitioners in China. The lawsuit was passed to him in an underground parking lot of his hotel in Canada, so I think he wont be coming back to Canada ( :

I know its not justice but its a start anyway ( :

May 29, 2007 @ 12:44 pm | Comment

Richard, Snow, canrun:

There is a method to my madness, just believe 😉

I will admit the “bad China” routine has lost its punch, I’ll try to come up with something the bite of a fresh lime.

May 29, 2007 @ 1:15 pm | Comment

Ha ha. My American girlfriend made exactly the same comments 20 years ago when she couldn’t find a shop open in Austria on a public holiday. She said Europe was “finished” and living standards would collapse in the face of competition from the US and Japan (then the big economic giant).

Plus ca change …

May 29, 2007 @ 1:17 pm | Comment

“What a life is ours, since we must live according to the convenience of asses.”

May 29, 2007 @ 1:44 pm | Comment

This is off the topic-sorry- (well perhaps not THAT far off), but prozxee.com seems to have been blocked here in the Middle Kingdom. Anonymouse is just fair, though. Anything simple and free like proxzee that is currently available? Thanks!

May 29, 2007 @ 4:29 pm | Comment

I don’t think Europe is finished, but there are limits to the viability of its welfare benefits. As I said, this is not (like everything else) black and white. The notion of Germany falling behind in its competitiveness wouldn’t havew been much on my mind had I not read China Shakes the World on my flight to Germany. There, staaring me in the face, were the qualities that the author said were making Europe’s systems less competitive. I never did get my cable or pen. Thomas says the stores were open, Shulan says they were closed for Pentecost ´- and Shulan is correct. My hotel even said all the stores would be closed. I will remember my walk up Marienplatz looking for an open store for a long time. Only beerhalls and a few restaurants were open. Finally I did find a place late Monday that was completely open, the Hauptbahnhof, but I couldn’t find iPod cables for sale there. As I said, this may have just been bad luck in terms of my arrival time, but two and a half days with nothing but beer halls and movie theaters open did startle me and force me to draw comparisons with the place i was coming from, China. Two and a half days.

We can laugh about competition from China and say the warnings are alarmist. But to the workers throughout Europe and the US who have lost their jobs to the Pearl River Delta it isn’t a laughing matter. Many of them find new jobs, but almost always for far less in wages. I’ll be writing more about this and China Shakes the World when I get back next week. China is a hopeless mess in many ways and the myth of the 1.3 billion customers is something I’ve laughed at for years. But China’s cheap labor and its indifference to intellectual property rights are nothing to laugh at and are affecting the lives of many once-safe workers and product developers around the world.

May 29, 2007 @ 8:56 pm | Comment

Classic case of reverse culture shock. Expats in China quickly become accustomed to 24 hour shopping, cheap food, DVDs, taxis etc. It comes as a shock, then, to return to the world where the rest of us pay full price for merchandise, take decent holidays and don’t have locals treating you special because you are a laowai. Doesn’t Munchen have a Chinatown where you can go hang out?

May 29, 2007 @ 11:32 pm | Comment

China’s self-inflicted feelings of “humiliation” by everyone over the past 400 years coupled with its self-driven desire to “regain lost territories” is also nothing to laugh at and is also highly irresponsible behavior for a nuclear power.

May 30, 2007 @ 1:03 am | Comment

Splitter, you may well be right. But even in America, I can’t remember an instance where no shop was open to sell me their products for two and a half days. This was jarring, having just finished reading a book about, among other things, this difference between the way the Chinese and the developed West do business.

May 30, 2007 @ 2:16 am | Comment

It’s always ironic when it turns out China is more capitalistic than anyone else.

May 30, 2007 @ 2:47 am | Comment

First time I was in China I was surprised that the shops opened on Sunday (Yes call eurocentric, but that’s how it was). I asked a Chinese about it, and, well that was what surpriesed him. Why beeing so stupid to close your shop when everybody has a lot of time to go shopping, was his answer.

How could somebody ever think that Socialism was a good idea for China?

May 30, 2007 @ 4:22 am | Comment

Richard, you always have to think about local customs/holidays/etc when you go travelling. I would sympathise as our shops are open on Sundays and most bank holidays, bar things like Christmas (even then you get some people working short shifts).

But that’s life, just as in China I can’t get a decent English-language newspaper because the good ones (i.e. foreign) are all banned and the domestics have nothing interesting to say, other than the usual crap. I have been able to read a copy of the Times or International Herald Tribune in every other country I have ever been to.

May 30, 2007 @ 4:37 am | Comment

Just got my hands on Kynge, which I am supposed to read anyway. Ever since China opened up in 1979, you have had books like this coming out. I am sure that Kynge has one or two things to tell us that we didn’t know and I’m looking forward to reading the book, and read Richard’s comments.

It is, however, important to keep in mind that Kynge doesn’t speak German and seems to have spent only a couple of days in Germany. His main informant on why a certain steel plant in Dortmund was sold to China is a parish priest, who tells us the usual litany about Euroschlerosis. I wouldn’t dismiss a whole country based on reading Kynge and spending two and a half days in a country…

May 30, 2007 @ 5:31 am | Comment

KEIR,

Whats up, how come your blog is out???

Some info that I gave above is not correct. Bo Xilai was served in an elevator and the accusation is not clear to me…

I can’t believe the minister of money in Canada had the stupid nerve to say that Bo is such a swell guy, what an error. He will be in the hall of shame when the truth comes out…

When it comes to Falun Gong ,people who have power seem to just sit back and be glad that theres no investigation, its quite a freak phenomenon… They just wait for evidence to seep in and they just act like its ok to be that way! Like if someone says that they are being tortured by the masses, its time to freakin do something, at least go in and check it out!…

The UN special rapporteur on torture Manfred Nowak went to China last year and reported that 66% of torture victims were Falun Gong people, so wheres the follow up?

What I’m wondering is whats the deal with not finding the truth, how come people fool themselves so easily?

What I wanted to say originally was:

KEIR,

Whats up, how come your blog is out???

May 30, 2007 @ 12:22 pm | Comment

Keir,

I guess its not you, I just realized its spaces.

Sorry to bother everyone with this but, its relevant anyway cause he’s in China and what he writes is “subversive” so ….you know.

May 30, 2007 @ 12:32 pm | Comment

Raj, I AM thinking of local customs – that’s what this post is about.

I didn’t plan or research this trip – I got a call, and two days later I was on a plane. I never thought I would need to do research in advance to see whether the country would be closed down for two and a half days. of a four-day trip

Snus, the book is not about Germany, though Germany comes in right at the beginning. You don’t need to speak German to comment on the German welfare system. And his comments are based on research and interviews, not cliches. I’m sure you can find something wrong in the book somewhere, but overall I found it excellent. It is much more skeptical about China’s survival than Germany’s, but it makes a point that has been made many, many times, even by many in Europe, that the welfare system in some European countries is unsustainable and encourages complacency.

May 30, 2007 @ 1:34 pm | Comment

I do not think the welfare system and living standard in Europe are really in danger.

Neither I do believe that China represents a great danger to Europe (or America) economies in the long run.

OK, the situation now is a little stressed, the disequilibrium between China and the West is too great. Labor conditions, wages, environment standards, efficiency (both material and political 😉

But if China really could pose a big threat to the standards of living in EU and America, the society would react and the politicians would rapidly follow suit.

The west markets would close to China imports, or better all kind of barriers would be set up in no time. China may be big, but guess where the big markets are.

Both sides know that, specially the Chinese. And I think no one is interested in a new kind protectionisms.

The benefits of open market are too great. For China as a way to improve the living standard of its population, bank system, factories etc.

For the west as a way to get even more products and services at lowered price. Also improve competition. ( At maybe even to kick a little the buts of lazy westerners)

Some sort of equilibrium will be found and maintained in the long run.

May 30, 2007 @ 3:21 pm | Comment

I’m a little late to this thread it seems…

I’m not convinced (today, tomorrow may change here in China) that China is really going to destroy the way of life that most of us grew up with. I do believe we are in for some changes as the global economy seeks to find a new balance (agree with quebec on that!).

Also, China seems more adept at attacking the low-end of mature markets, but I have not seen them truly build out something new. Yes, EVERYTHING was invented in China, but when did you actually see China capable of selling their solutions? For new markets, they still depend a great deal on the creativity and need for constant change found in more developed Western countries.

Think about it, a culture (and government) whose whole basis is to maintain internal harmony is hardly capable of changing the rest of the world when it’s unable to handle internal disruptive elements.

I’ll just cut it off there…but I feel like I could go all day on this topic…

May 30, 2007 @ 6:30 pm | Comment

of course they aren’t going to be “creative” when something else pays better.

May 30, 2007 @ 10:46 pm | Comment

of course they aren’t going to be “creative” when something else pays better.

May 30, 2007 @ 10:47 pm | Comment

“…the welfare system in some European countries is unsustainable and encourages complacency.”

Exactly what is unsustainable? You mentioned universal health care in your original post several times, but it is widely acknowledged that the US employer-based health insurance system puts US corporations at a competitive disadvantage.

May 31, 2007 @ 12:30 am | Comment

Snus, this idea that the European welfare state is unsustainable is not some wild concept. It has been voiced by many in Europe. Maybe it can go on as it is with an ever smaller number of workers paying into the system to support more and more retirees. I hope it can.

May 31, 2007 @ 12:58 am | Comment

Oh, so we are talking about retirement funds now? You didn’t respond to my point above.

Anyway, the extent to which pension systems are sustainable or not is ultimately decided by the productivity of the workforce – it is not a question of calculating a simple ratio of how many workers are paying for how many retirees. To use an analogy, a fraction of the population in most European countries is providing the rest with food today. No one is talking about an impending food shortage because fewer and fewer people are engaged in agriculture. Malthus was wrong! And I think that many people who want to privatise and slash pension funds have ulterior motives.

I am not saying that the welfare systems in Europe cannot be trimmed or reformed, but we should take all dire prognoses with a pinch of salt.

May 31, 2007 @ 1:17 am | Comment

I don’t know if anyone is following this thread anymore, but I just read half of Kynge’s book and I am struck by the fact that so far, he has talked a lot about the welfare state in Europe and various “entitlements” but very little about entrepreneurs. When you hear from them, they usually moan about selfish trade unions or working hours. However, many plants in Europe that have been closed have been perfectly profitable operations, but they have been moved because share holders demand even higher returns on their investments. Competitiveness is not just measured in terms of being able to sell products on the markets, but to deliver a steady stream of revenue to shareholders. To lay off thousands of workers can often give your share a significant boost on the stock markets. Is that really rational? Is that not an “entitlement mentality” that needs to be discussed?

Such logic does not seem to operate in China. One thing that struck me in China shakes the world is the fact that Chinese entrepreneurs are so willing to take risks and to stomach low profit margins. The entrepreneur who bought the German steel plant in Dortmund was able to see beyond low profit margins in the short turn and saw the opportunities in steel production. These industrialists do not have golden parachutes and other kind of arrangements that protect them from the consequences of their actions. Doesn’t the fact that Chinese capital markets still are quite unsophisticated insulate China from pressures that Western industrialist cannot afford to ignore? Perhaps the bigger problem in Europe and the US are entrepreneurs and investors that are unwilling to take risks that their competitors in China are willing to take? Perhaps we cannot afford capital markets with unrealistic expectations of profitability? Perhaps the problem is not workers that are too comfortable, but investors that have grown used to certain levels of revenue?

May 31, 2007 @ 5:22 am | Comment

Richard! Man! You gotta find some way to slow . your . life . down a little.

Not able to buy a plastic doodad for three days? How important is that compared with the family time of all those people not tending their ships 24 hours/day?

The first step to getting off the treadmill is to admit you are on one. 🙂

May 31, 2007 @ 5:06 pm | Comment

Slim, it’s a fast and furious world. Compete or die.

Smurs, no time to reply until the weekend. Bloated retirement programs, unsustainable healthcare, antiquated labor laws – maybe they don’t exist at all, the book said they do, will argue later.

May 31, 2007 @ 9:41 pm | Comment

hey there, i’m sorry if this seems unrelated, but i wanted to pass it around asap, is that OK? SECRET DOCUMENT: Ministry of Public Security’s Olympics Scrutiny Notice Reveals CCP’s Desperation, Violation of Human Rights, and Opposition to the Olympic Spirit This is what the CCP doesnt want people to know, that it is desperately afraid of people who seek justice and truth.HA! They think they can fool the world!!! May 25, 2007 Recently, Chinese authorities sent out the following directive: Since early-April, the Chinese police have been secretly issuing “Notification on Strictly Carrying Out Background Investigations on Candidates for the Olympics and Performing a Pre-Selection Test” to each province, autonomous region, police stations and bureaus in municipalities directly under the Central Government. In the notification, after removing the “Three Representatives,” other falsehoods, big sounding but empty words and bureaucratic jargon, what’s left reveals the evil Party’s weakness, and clearly shows that it is against the Olympics spirit and violates human rights. Please find below the language on the investigative directive: Sources: http://uyghuramerican.org/articles/940/1/Ministry-of-Public-Securitys-Olympic s-Scrutiny-Notice-Reveals-CCPs-Desperation-Violation-of-Human-Rights-and-Oppo sition-to-the-Olympic-Spirit/index.html and: http://www.clearwisdom.net/emh/articles/2007/5/25/86066.html I. Background Investigation on Individuals: 1. International Olympic Committee (“IOC”) members, including: (1) IOC members and guests invited by the Officials of international sports associations. (2) Officials of the International Single Item Sports Association, referees and their invited guests. (3) National and regional IOC members, including athletes, officials of delegations and officials attending the Olympics. (4) Officials of the Executive Committee in the Organization Committee of the Host Country, host city mayor, host city leadership in the government and their invited important guests. (5) Host city for the next Olympics and representatives from other cities applying for hosting the next Olympics. (6) Sponsors who have signed contracts with the IOC. (7) Athletes and Delegations. 2. Media: Media who purchased broadcasting rights and institutions who purchased broadcasting rights. 3. All Olympic staff members, including IOC employees, volunteers, contractors, security and temporary staff, and all others falling in that category. II. Benchmarks for Background Investigation: Anyone who falls into the following 43 categories, subdivided further into 11 different subcategories, must be excluded from the Olympics Games and competitions: 1. China’s Enemies: (1) Overseas hostile forces and hostile organization members. (2) Key individuals in ideological fields. (3) Individuals who disturb social stability. (4) Hostile individuals in Mainland China. (5) Individuals who were handicapped during riots and those who endanger society and family members of deceased people. (6) Individuals who were sentenced because they committed anti-revolutionary or other crimes and are thus considered a threat to national security, close relatives of such individuals, and individuals who have close ties to them. (7) Individuals who escaped overseas and any suspicious associates. 2. Falun Gong and Other (slanderous term deleted) Organization and Members of Other Harmful Qigong (1) Falun Gong and other (slanderous term deleted) organization members, associated organization who are supporting Falun Gong. (2) Members of 14 organizations that are evil cult organizations and assumed the mantle of religions, those that were identified by relevant state agencies and, members of seven existing evil cult organizations. (3) Members of the 14 risky qigong associations that were identified by state agencies. 3. Religious Extremists and Members of such Religions (1) Members’ illegal organizations that reside locally or abroad. (2) Individuals who were arrested or sentenced for being engaged in unlawful religious activities. (3) Individuals who are active in illegal religious activities. (4) Individuals who distribute illegal religious books and audio-video products. (5) Individuals who form unlawful religious groups, organizations, schools and other such sites, as well as other religious entities not sanctioned by the state. 4. National Separatists (1) Members of the “Three Forces” in the Xinjiang Autonomous Region and individuals supporting them locally and abroad. (2) Dalai Lama’s Government of Tibet in Exile and members of its affiliated organizations. (3) Individuals who partake in parades, demonstrations and protest activities with the goal of breaking up nations. (4) People who offer financial support to national separatist groups or activities. 5. Media People who endanger the Olympic Games: (1) Staff of any foreign media hostile to the People’s Republic of China. (2) Staff of media who publish anti-communist articles and those who viciously slander the Chinese Communist Party (CCP) and the Chinese government. 6. Non-governmental organizations involved in activities that pose a threat to the Olympic Games: (1) Foreign non-governmental organizations that are supported by foreign governments and who are known to be involved in penetrating, overthrowing and destruction of the CCP and the Chinese government. (2) All members in different non-governmental organizations who are likely to jeopardize the Beijing Olympic Games. 7. Dangerous elements, consistent appealers and other individuals who are known to be strongly discontent with the CCP (1) Individuals who show strong discontent with the CCP and Chinese government. (2) Individuals who file consistently troublesome law-suits or appeal to higher authorities for support. (3) Individuals who bring foreign lawsuits in cooperation with overseas forces. 8. Individuals who filed for investigation and prosecution by judicial authorities, or those under criminal and administrative orders. (1) Individuals who filed a complaint with public security authorities (2) Individuals who are under residential surveillance and out on bail while awaiting trial and those with restricted liberty. (3) Individuals who once were detained or arrested as suspects of criminal activities and were released without being fully cleared. (4) All individuals at large and escapees. (5) Individuals with warrants against them and individuals under investigation. (6) Criminal suspects by the border control. 9. Criminal elements who are on parole or probationary supervision, who are awaiting sentencing, who are released on parole, or released on bail for medical treatment, who are deprived of political rights, or others who received a sentence but are under home detention and those who were sentenced to labor re-education and rehabilitation and whose labor re-education sentence or other type of sentence was commuted. (1) Criminals who are sentenced to home detention and are under supervision, whose political rights were taken and who were given a suspended sentence. (2) Criminals who were sentenced and released on parole, and whose sentence was commuted to temporary home detention but continue to be under surveillance and who are serving criminal detention outside a detention center. (3) Individuals who are sentenced to serve labor re-education outside the re-education labor center. (4) Individuals who were released on bail for medical treatment and those who asked to be released under such a program. 10. Violent terrorists (1) Members of terrorist organizations. (2) Individuals who offer support and assistance to terrorist organizations or their members. (3) Relatives of members of terrorist organizations or individuals know to have close relationship with such members. 11. Members of illegal organizations (1) Individuals who are members of unlawful political organizations. (2) Individuals who carry out activities in the name of the organizations that are not lawfully registered. (3) Individuals serving in any capacity an illegal organization. Individuals who establish ties with such organization, and individuals who instigate discontentment toward the CCP through Internet. The notification requires Public Security Agencies and Bureaus in all provinces, autonomous regions and municipalities directly under the auspices of the central government to give priority to this directive and assign it top priority status. Group leaders are to be established at all levels. Deputy leaders responsible for public security in Mainland China must assume full responsibility. All related departments must cooperate. It is vital to keep this order and all associated activities secrets and not to assign it to others. It is of utmost importance to give the look of an easygoing environment to the outside, but in fact keep a firm handle on all activities. Members from the “Two non-s” organizations, Falun Gong practitioners and individuals who appeal to higher authorities for help, should all be monitored closely, and kept on a tight leash. No reason will be given to the public why anyone may not be allowed to be present at the event. Everything has to be kept confiden tial.

June 1, 2007 @ 1:16 am | Comment

Oh man the format is all sqashed together, owel … I was thinking about what snus said about westerners taking their standards of living for granted. Its a good point. I live in Canada and the complacency is sickening here. people are content as long as the donuts and coffee are rollin in, and dont really give a peep about anything that matters, comfort is the highest law they follow here, yucky, This is freaky cause the Canadian constitution is pretty righteous and the values of this country were good back in the day… Now, well you no how it is, its comfort and cash Last week some freak psychopath bo Xilai from the CCP cmae to talk money with our guy and was welcomed and defended, and its all just for money!!! Shame! My friends dad was a high vietnamese govt official when the communist came in. He told me that the reason that the commies were able to move in was effectively cause the moral character of the viet govt was weak. They gave in to the corruption of the CCP evil. That is to say, people need to hold their values dear to them and the wolrd if they want goodness to prevail.. If we are so lazy the CCP just takes full advantage of that and will come to collect, corrupt and exploit whoever is not awake… thats my two cents on that. Sorry about the font of the secret document, its important to read and spread around none the less.

June 1, 2007 @ 1:24 am | Comment

snow, are you not tired saying the same things every time?

June 1, 2007 @ 2:47 am | Comment

Richard:

I’m looking forward to reading your thoughts and I hope that you won’t dismiss arguments in favor of the European model by just referring to common knowledge. The argument I made about stock markets is not something I just made up, I have mainly been inspired by Ronald Dore’s Stock Market Capitalism: Welfare Capitalism: Japan and Germany Versus the Anglo-Saxons (New York: Oxford University Press, 2000).

June 1, 2007 @ 6:02 am | Comment

Live in China for a while, and Europe/North America seem hopelessly complacent. Live in North America/Europe for a while, and China seems a hopeless mess.

Perspective is quite often a strange and inconsistent beast.

June 1, 2007 @ 2:28 pm | Comment

http://mousedon.blog.com.cn/archives/2007/2273876.shtml please take look here. demonstrator in Xiamen this morning.

June 1, 2007 @ 4:15 pm | Comment

Bleak future for Beijing’s heritage http://news.bbc.co.uk/2/hi/asia-pacific/6709099.stm The “communist ie, atheist, materialist way stinks like poisonous air!

June 2, 2007 @ 6:13 am | Comment

Shelley, thanks for the tip – big article in today’s LA Times about this demonstration. Very interesting – I’ll try to put up a post about it tonight.

June 2, 2007 @ 8:29 am | Comment

China Shakes the World, right? I finished that book about six months ago and I have been meaning to write a post on it ever since. But all I can think to say is, best book on China’s economy yet. Looking forward to your post as I figure you can do better.

June 2, 2007 @ 3:28 pm | Comment

I’ll help, Lisa…

http://tinyurl.com/yqfeaw

June 2, 2007 @ 8:26 pm | Comment

This is a comment about this topic that I left over at German Joys, a blog by an American named Andrew living in Germany.

I’ve lived both in Germany and China. Peking Duck’s experience is not out of the ordinary for Germany. Listen, I have no problem with Germans having very restricted hours of business. Andrew has written that those enforced periods of quiet are one of the reasons he likes living in Germany. That system reflects German values and choices. All good.

China is very different, of course. Having lived there and witnessed their capitalist energy first-hand, you realize right away that, in the course of their five-thousand-year history, that experiment in communism was doomed from the beginning. Oddly, though, the Communist Party itself now functions just like one of the old dynasties — and thus the Chinese are comfortable with the arrangement, as long as they are successful, that is, and maintian the “mandate of heaven.”

In my somewhat expanded interpretation of Peking Duck’s argument, to which he himself offered several qualifiers, Chinese customer’s needs — and the needs of the shop owners and their desire to make more money — are the focal point of the economy. Open doors most of the time, for the Chinese, are good for both the businessman and the customer.

German businessmen and customers, on the other hand, prefer to make a trade-off: less hours of shopping for more hours of quiet and no working. Are most Germans happy with this trade-off? I would probably say yes.

So Chinese would rather stay open and make more money while Germans engage in this agreed-upon trade-off. All fine, in my book.

I myself am not arguing for one system over the other. It is my understanding that economies reflect to a large degree the cultures into which they are embedded.

I thought, at the same time, that the comments page had a good discussion of the variables between the two systems.

I still go back to Germany (last fall, two weeks in Berlin) and I still go back to China (Shanghai last). The people and societies are very different, but each great in their own ways.

*

June 3, 2007 @ 3:37 am | Comment

“I speak German (though on this trip the German kept coming out with lots of Chinese) ”

I can only imagine the looks of befuddlement when you said things like, “Ich bin meiguo ren.” 🙂

June 3, 2007 @ 11:48 am | Comment

Just to close off this thread… I think what I wanted to say was really simple and I’ll try to say it one last time. I was reading a book about China’s competitiveness and the advantage it holds, specifically over Europe and America. It made a special point of singling out Germany’s generous welfare state, long vacations, short work week and perhaps over-generous and unsustainable health care system. I love Germany’s model, provided it is viable. I wish America would change to this system, if it could work as planned. But when I got off the plane the exact things the author warned of were staring me in the face. For my two and a half days there, Germany appeared hopelessly uncompetitive and frustrating. This wasn’t just a matter of getting an iPod cable. There was business I was prevented from doing. I witnessed serious frustration from visitors hotel who couldn’t find an open restaurant. And no, not all restaurants were closed, but on Monday almost all were. For two and a half days I could buy absolutely nothing except food, and my choices there were extremely in my limited. It simply struck me as an extraordinary coincidence that the words I had just read in my book were so relevant to my trip. I was shocked. As I said, maybe it was bad luck. As Thomas says, maybe there was a big department store open, though I am pretty sure there wasn’t – not in Munich, maybe in Berlin. I don’t want to argue about whether or not Germany’s system is good or bad or failing or whatever. We won’t get anywhere. From all I’ve read, the system faces enormous challenges. If it can go on forever as it is now, I’d not only be thrilled, I would lobby with all my might to get America on the same system. But Europeans tell me it is heading for a train wreck. We’ll see. Based on what I know, I’d have to guess it is unsustainable. As to the point made by someone that Kynge doesn’t speak German so can’t be trusted to write fairly on this issue, all I can say is that is pure nonsense. Kynge also writes about conditions in Sudan and how China is exploiting them. I’ll bet my life savings he doesn’t speak Sudanese or Arabic or any other local languages in that country. And he doesn’t need to. There are plenty of good sources out there in English about Darfur and Iraq and most other places. Would it help? Sure. Does the fact he doesn’t speak German cast a shadow of suspicion over what he writes? Absolutely not. Someone who is fluent in German can be just as prejudiced and even more so than Kynge. Okay, that’s it for now.

June 3, 2007 @ 7:09 pm | Comment

Everything was invented in China?

China has invented nothing in at least the past 250 years.

They steal ideas, they do not create them.

June 4, 2007 @ 4:19 am | Comment

Richard:

You didn’t respond to any of my substantive points, what am I to make out of that? I think your blog is one of the more interesting ones in cyberspace right now, but your response in this particular debate leaves me aghast. Really disappointing.

Now to return to the only point you responded to, I do think the fact that US and British journalists rely on their native language too much for information presents a serious credibility problem for English language media – especially US media. The inability of US television to make foreign cultures comprehensible to a wider audience is appalling.

As for Kynge, he clearly has done his homework in relation to China, since he can speak Chinese, but when you read the book closely, it is painfully obvious that he has limited reading skills. That does impair his understanding of Chinese history, which he frequently refers to. You may think that is not a big problem, but I am 100 per cent sure that you wouldn’t take a German or French correspondent in the US seriously if he or she couldn’t spell names of US presidents correctly.

June 4, 2007 @ 4:32 am | Comment

China work this hard because they are sick about being poor…

Snusmumriken, my quick two cents w.r.t. your productivity and agriculture example.

When the agriculture productivity increases, fewer people are needed to supply the society with food. For the people who still engage in agriculture, they aren’t subsidizing other people’s food need. They sell their products in exchange of other products and services.

In your presumably pay-as-you-go public pension system, it’s a one-way street for the future workers — they pay and subsidize the pensioners.

In a globalizing world, why can’t those workers leave the country all together to reap the full benefit of their increased productivity?

June 4, 2007 @ 8:47 am | Comment

Snus, I don’t hve to argue every point with you. I said I am no expert on German economics, I wrote about what I saw in correalatoin with what I read, and I draw my conclusions, which may be totally wrong. Take it or leave it. Sometimes I have neither the time nor the wherewithal to engage in every argument ut in front of me here, and if it disappoints you I’m sorry. I think the point of my post was misinterreted by you and some others, and that’s okay; I’d simrather not devote any more time to it. Those who get my points will understand this,

June 4, 2007 @ 9:24 am | Comment

Richard: Whatever. I clearly wasted my time.

JXie: My analogy with agriculture was only a loose one to be sure. But I want to inject an amount of skepticism about the claims. At the end of the day, who will pay for pensions is a question of redistribution. And a productive society will be more able to pay for that than a less productive one, so that’s where we should start look when figuring out the costs.

June 4, 2007 @ 11:16 am | Comment