I have recently been in the USA as tourist, and ran into a similar situation in Oregon. I stopped at a gas station to fill up the tank when I was interrupted by an employee. Apparently in the USA (at least in Oregon) there is a law stating that if a person is able to do a job, he should do that. This also includes mandatory gas station employees.

The USA and China are not that different. There is one difference: The China goverment seems to try to fix problems before they become to big, while the USA style of goverment seems to be more the Texas way: First shoot, than ask questions.

Hi John,
not easy times for China. I was surprised to see people protesting in front of the closed factories.
I don´t know how bad it will be in the end for China, but I´m sure this is not over. Most of the people here in Germany or in the West think twice before they spend their money. First because they have less money in their pockets, and another point the fear, that Chinese produkts are contaminated, with what ever. And China´s economy depends on the export in the West. Here the people also fear that the unemployment will rise. But here you´ll get an unemployment compensation, or something like this. And in China? I think, the people will get nothing.
To the 800 million "working" in China, I agree with you. Not to forget the millions of migrant workers, where will they get work in those times?
When this crisis will continue and more factories will be closed, it will also affect the Chinese "middle class". Sure, the pointers and greeters will be the first to be fired.
So it´s a real great challenge for the Chinese leaders and the Communist Party to create "real jobs", for all its people. And China has many people. I can imgine, that in some very affected areas the people will go into the streets and demonstrate for more work and jobs.
Not easy!
Best wishes
Elke

Of course, people are worried about the future, specially if you are
an auto-worker, any way, the situation that we are in, it is not United
States fault, we can blame high comodity prices, close economies
and policies that are protectionist, which I include Germany, Japan,
China, etc. In such type of markets which depend on exports and
with an internal market where every thing is expensive, or course,
the options are limited, and now the world expects that United States
has to be the savior, we did not have any help from the world to
prosecute and kill the terrorists, if the world wants a fast cure, let
the world know one thing, show us the money, so we can solve
this economic crises.

I'm a college student in China. My father works in a foreign tobacco company and my mother works in a hospital. I have never have the feeling of being in a economic crisis except for the high petrol expense(however, it's getting down again...). Nor do people around me have shown any unrest. Unlike western people, most of us hold our money in the safe or banks, not insurances or investments. The power of the government is so great that they make decisions to fire or not,not the factories. Although China still have a lot to deal with, I have confidence in her.

Social unrest may mean losses for some but gains for others, such as the less economically liberal wing of the Communist Party. A chance for another Mao to emerge?

Honestly, the overstaffing problem is so rampant that I tend to think there has to be an invisible angle that somehow makes it make economic sense; tax cuts for enterprises employing a certain number of people that outweigh the extra wages paid or something along those lines. There's no way so many Chinese bosses are either too incompetent or too softhearted to cut people when they have at least twice the employees they would need if the remaining half could adjust to actually having to do some work.

Good article,
I do want to say that China has for so many years been almost a factory to the world. And with the global economic slowdown which seems to be picking up, this will definitely affect China in a negative way.

That being said, we've all read China spending massive amounts on infrastructure projects, loosening credit and injecting liquidity into the financial system, and trying its best to create jobs.

But the question is intermal consumption going t make up for the loss of consumption from customes abroad? The net effect will probably be negative because its every country in the world that's having this issue. No matter how much interest rates are lowered, or liquidity injected in the system, people have lost money, jobs, and are not borrowing.

I can also see the slowdown from here in Hong Kong because the air, which normally is very polluted in late fall due to winds originating from the north, is fairly clean. Perhaps because of a closure of so many factories in Guangdong province?
cheers jimmy

The visa restrictions prior to the Olympics did not help either. We were looking to launch a business in Shen Zhen and Hai Nan, but found the restrictions too limiting, so we are focusing on Cambodia instead for now. The cost is a single entry visa for Americans is really high too.
We just found it far too challenging at the time.

John,

We have been living in China since '05 and still can't get over the unproductivity of the "work force".

I'm glad you point this out fact but your writing does not provide any insights on a solution. Stating this problem is something most can do, what would be a difference maker is a solution.

I'm clueless...

George Kuan

things in China are reallly worsening.
The most ridiculous thing is, the government still tries to collect as much taxation as possible and then use such income to 'stimulate economy' rather than cut expenses from its end while reducing taxation from us ordinary people; in fear of losing a job and high possible clinic costs, I've lessened my consumption a lot... I guess I can be categorized in "middle class" and I strongly believe that my case is still so much better than most of us.

I actually find the news, that this story is a new phenomena, quite mind blowing. Blogging during the Olympics, the arrogance of the Chinese amazed me reading statements where the Chinese people were boasting about their financial power and how they are going to take control of the world geopolitical process – NOW WE HAVE ALL THE MONEY, IT IS OUR TIME TO PUNISH THE WEST FOR DESTROYING THE CHING DYNASTY. AS IF THE CHINESE ARE ALL INNOCENT VICTIMS. Of course the secret of the past 30 years of growth in China had nothing to do with a superior Chinese political/economic policy, but pure cheap labour. The Western world was successful at weeding the Chinese off the influence of the USSR, due to massive capital investment into manufacturing, which of course meant employment and stability for the Chinese government. Now the story is very different. Since the Chinese are not that interested in reciprocating, economically, through embracing imports from the West ( Of course designer goods are a very different story), it is time for Europe and America, to wake up, and start reversing the trade trend, by bringing manufacturing back home. Personally I hope this is exactly what happens. In the West, governments have relented their power over the economy and allowed the people to gain wealth. In China the government has gained the majority of wealth, and the people have been kept poor. Yes it is true the Chinese people are better off today in comparison to 20 or 30 years ago. But, the system is still the same. Basically all 50 million Communist Party Members and their cronies are allowed to get rich, and the the rest of the people are pushed down and kept ignorant and poor; well, basically surfs. Imagine, as Western governments returned to the people the right to govern their own wealth, the Chinese government just decided to keep all of the countries cash in the Communist Party’s Bank Account. Why on earth does a government need to keep US$1.8 trillion in a bank account. Maybe the Chinese Communist Party has a plan to manipulate the world economy. So YES, it really is time for a new world order. However, what needs to emerge from the economic crisis, must be in the favour of the West, simply because the West is the only civilisation which listens to the people and places the wealth into the people’s hands. Any talk that China is going to save the world is utter rubbish.

What's the population? 40 billion? Sounds like a tough one for THEM to handle.

What china should do is: produce as many solar ,wind and other equippement's- energy -generating units, before all natural recources are finished, and produce it for the whole world ,a.s.a.p. .Rather in one Year than in 2.

That creates a lot of jobs and will safe china also for the Economic dependence of fuels and make even Africa dismissible.

In my theory oil is a buffer for earthquakes and should be left alone.

Also toys and so should take a radical transform,In the near future,wtih the development of superlight material and alternative energie is becomes relatively cheap to lauch satelites and spacecrafts that endure longer and to stay high in the sky( for satelites).

I have to add this to my previous comment:
By the way it's time to recognize for all cuontries that there is a war going on: a war of man against nature,and its getting serious .so stop playing with tin soldiers in the sandbox,and acknowledge this in time , we all have played long enough, now it's time to grow up. To win this war we need the worlds armies, to make more areas suitable for agriculture and to plant trees as much as possible,and let the jungle and the forests alone.I consider the highest level of civilsation as of science whan they are capable to transform most areas in junge and agricultur in places that are now to dry or to cold or whatever.I know to launch fireworx is addictively fashinating,but start using your brains wisely instead to make it dismissible.

I will not presume to be very knowledgeable on China but one thing I have seen through more than 40 years of watching China's leadership actions is that China do not care about any other nation or country but only about what is "best for China". They use cheap labour and inferior products to manipulate trade, makes sure they protect their country from competitive imports etc. They are presently moving into Africa in a massive drive, making deals with African leaders and all for getting control of Africa's commodities. Oh yes, China has a plan, make no mistake but Chinese people are patient, their plan will come to fruition in another 20 years perhaps but yes, when the western countries wake up, they will control commodities, finances, trade etc. Mark my words. Don't trust China!

Oh, and one more remark please. China leadership do not care for human life, not even their own people. People are just there to be used whether their own citizens or those of other countries!