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Why China Can’t Be Depended Upon
 

olafenizer's picture
IB
(King Kong, 1,005
 
Points)
 on 6/5/12 at 9:30pm
The Grass Is Smiling.JPG

There was a great article in the Wall Street Journal the other day explaining the inability of a massive Chinese state-owned construction company to complete a simple highway project in Poland. Ironic jokes about incompetence aside, this highlights an important point about China that is often lost amid the hubris about breakneck development: Big or small, China cannot be depended upon to competently make anything of long-term quality.

The assumption that most consumer goods manufactured in China are inferior grade products made by migrant workers in a sweatshop is to a certain extent quite true. However, in addition, the awe inspiring high-speed rail lines, new skyscrapers, and mass transit projects built to impress upon the world that China is rising to become next world superpower suffer the same shoddy workmanship, and are smoke and mirrors on the largest scale.

In China, the appearance having good quality is more important than the reality having good quality. Why else is there an pandemic of knockoffs from purses to watches to shoes, but also Facebook and even an entire Apple store? China fails to grasp the concept that the value of, say, an Adidas shoe comes from more than just the logo; that an Adidas shoe is an Adidas shoe because it is a well-made, comfortable, reliable shoe.

Consider the high speed rail development China is undertaking. Over the past 5 years China has spent hundreds of billions of dollars to import state-of-the-art technology and build the world’s largest, fastest high-speed rail network that now serves more than a million riders per day. Impressive, right? It would seem that Chinese technical and management prowess will soon challenge Germany, Japan, and the like.

The July 2011 collision in Wenzhou that killed 40 and injured more than 200 illustrated that is not the case.

It’s not so much that fatal rail accidents such as these are unavoidable (they actually are: Japan has demonstrated that in “46 years of commercial train operations, the Tokaido Shinkansen has maintained a flawless record of no passenger fatalities or injuries due to train accidents such as derailment or collision”), it’s more that instead of honing up to its mistakes, the Chinese government tried to cover up the matter by attempting to destroy the evidence and strictly controlling domestic media coverage.

The Chinese may be building the tallest skyscrapers and the fastest trains, but it’s all for show. Four years ago Beijing wowed the world with the biggest, nicest Olympic venues ever; but now that the world’s interest has moved elsewhere the buildings are sitting unused and are literally falling apart. This phenomenon is happening across the country- new projects designed to impress, intimidate, and distract us from the fact that China is speeding toward a brick wall because of corruption, incompetence, and downright laziness. As much as the Communist Party’s propaganda machine will try to convince us that China is the economic juggernaut of the future, if you dig even an inch below the surface you’ll see that they’re full of crap.

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Comments

Rambo's picture

When you pay shit, you get

(Baboon, 150
 
Points)
 on 6/5/12 at 9:52pm

When you pay shit, you get shit quality. When you go to the dollar store to get that $4 superman figure, you get $4 of quality. I've been using my made-in-China Macbook Pro ($1800) for the past 5 years. Excellently built product. You pay for what you get.

And the part about the buildings "literally falling apart" and "sitting unused" is just totally not true. I visited China last summer to see a couple friends. The stadiums are always in use for domestic matches (e.g. soccer games) and the facilities are used by athletes (many from college) who are training for the Asian Games or the Olympics.

Just a note: CNN & FOX can't be depended upon either. Try visiting there to get a better picture.

seabird's picture

Rambo: And the part about the

PE
(King Kong, 1,473
 
Points)
 on 6/5/12 at 10:09pm
Rambo:

And the part about the buildings "literally falling apart" and "sitting unused" is just totally not true.

...Just a note: CNN & FOX can't be depended upon either. Try visiting there to get a better picture.

Re read the part he wrote on the government trying to cover up evidence of their train crash by literally burying the train cars.

“...all truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

- Schopenhauer

joiseyshore's picture

it may not be because of

O
 
Points)
 on 6/5/12 at 10:17pm

it may not be because of laziness or the government showing off. i think generally chinese businessmen have an unrealistic expectations of return on investment. the ones that ive talked to expect 25% (some even consider 20% a failure) returns and expect to multiply their investment several fold in short periods of time. whereas, generally, in our society, a 15% percent annual return would be considered solid. unfortunately, in order to achieve those ridiculous return numbers, corners would need to be cut and details need to be skimmed.

physconomist's picture

favorite part of the article

CO
(Monkey, 57
 
Points)
 on 6/5/12 at 10:20pm

favorite part of the article was when the shit started to to hit the fan the Chinese government commented on how the company was "independent".....hahahahahahah

Rambo's picture

seabird: Rambo: And the

(Baboon, 150
 
Points)
 on 6/5/12 at 10:21pm
seabird:
Rambo:

And the part about the buildings "literally falling apart" and "sitting unused" is just totally not true.

...Just a note: CNN & FOX can't be depended upon either. Try visiting there to get a better picture.

Re read the part he wrote on the government trying to cover up evidence of their train crash by literally burying the train cars.

A train is not a building. I specifically said "buildings" are not falling apart in my comment.

AstonMartin's picture

I don't think it's fair to

ST
 
Points)
 on 6/5/12 at 10:34pm

I don't think it's fair to generalize a few incidents to saying everything in China is substandard. Like Rambo said, lots of made in China products are excellent quality, and the country's investments in infrastructure have paid off. Yes, China does care a great deal about its global image, which I understand is a cultural thing, but it doesn't mean their skyscrapers and Olympic buildings are falling apart

I've had a chance to ride the high speed rail in China a few times, and it was better than anything I've been on in Europe. Have you seen NYC's subways? It's an embarrassment.

You've been reading too much fox news imo

melvvvar's picture

the thing with sourcing from

(King Kong, 1,693
 
Points)
 on 6/5/12 at 10:45pm

the thing with sourcing from china is that they have a different philosophy of speccing. you have to spell out exactly what you want -- and they will nail every spec -- but you also have to be explicit about what you don't want.

case in point: chinese steel is great if you don't mind that its been alloyed with radioactive waste. and you never said you didn't want shredded newspaper in your sausages. and so forth.

AndyLouis's picture

lived there for 8 months, and

 
Points)
 on 6/5/12 at 10:49pm

lived there for 8 months, and agree with many of your points, a lot of things look good on the surface but look a little closer and you're bound to find a problem within, particularly with engineering... scary

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HWF's picture

This article is so

(Monkey, 49
 
Points)
 on 6/6/12 at 12:52am

This article is so misleading. The logic really disturbs me.

1. A construction company can't build a highway in Poland = China is in trouble. If you've ever had anything to do with project management even remotely, you'll know that every single similar project ever by anyone has run over time/budget.

2. The fact that the trains crashed and China tried to cover it up = China doesn't appreciate good quality. Comparing this to Japan is misleading as well, as the train services and development of the countries have taken very different paths. China has since fixed the problem. China's laissez-fair development will inevitably result in such accidents - Same thing happened in Europe during its Industrial Revolution. China covering it up is what any self-respecting American corporation would do (think Monsanto, Enron, Worldcom). By the way, considering that basically all popular US media outlets are controlled by 1 family, it's difficult to see how America's media coverage isn't similarly controlled.

3. "Incompetence, corruption, laziness" - MAYBE you could argue incompetence based on the 2 facts, but no more than anywhere else. Corruption and laziness? Where did you get those from. Every country has corruption to some extent. Lazy by no means. You also have to remember that the power lies in the Military Commission, not the Party.

Overall, Westerners have to accept that China is the dominant force. They own most of US debt. When that isn't repaid, they will go and get what they are owed.

KingEastwood's picture

Loved that WSJ article. The

IB
(Monkey, 50
 
Points)
 on 6/6/12 at 2:44am

Loved that WSJ article. The main problem with Chinese companies is often with state-run companies which are not profit maximizing firms. Then you have the whole keeping your face thingy, so they wanted to get that contract in Poland to get recognition, were lazy when it came to DD, and then of course screwed it up, hoping for the government to intervene, which quickly detached itself. (better the company loses its face than China)

As Andy mentioned things often really just look nice but the materials are actually damn cheap. Apartments often get completely remodeled after a tenant moves out (cuz of faulty wiring, walls starting to deteriorate etc.) and the completely lazy just paint over any mold for example. I've been to China for several month and am living in TW (which is still somewhat better than China but you see similar things)

The public transportation system is actually only good due to the fact that it was built by joint ventures between Foreign and Chinese firm, so don't make the mistake and assume they are actually Chinese designs.

HWF's picture

Painting over mold is

(Monkey, 49
 
Points)
 on 6/6/12 at 3:15am

Painting over mold is standard practice in the UK.

UFOinsider's picture

Rambo: Just a note: CNN & FOX

O
(Human, 10,302
 
Points)
 on 6/6/12 at 9:37am
Rambo:

Just a note: CNN & FOX can't be depended upon either. Try visiting there to get a better picture.

FOX is openly partisan, but aside from small ideosyncracies CNN is more or less on point enough of the time to be useful. Both are whitewashed to an extent, but you might want to revist your premises. CNN tries to be a news network, contrasted FOX openly states that it's a propaganda network...that half of the high level staff are being indicted for corruption is a good indication of how dishonest they are.

YOU JUST GOT TROLLED
http://www.troll.me/images/red-foreman322/dont-you...

brandon st randy's picture

AndyLouis: a lot of things

PE
(Gorilla, 693
 
Points)
 on 6/6/12 at 9:45am
AndyLouis:

a lot of things look good on the surface but look a little closer and you're bound to find a problem within

And that is exactly how you make money in China, by identifying fake facades one at a time then position yourself accordingly to benefit from the fallout.

Incidentally I noticed the Chinese knockout spammers have found their ways onto WSO---what took them so long? Anyway those spammer threads offer great real world case studies on this very topic.

I can tell you how I made each of my millions - but not where I got the very first

UFOinsider's picture

brandon st

O
(Human, 10,302
 
Points)
 on 6/6/12 at 9:56am
brandon st randy:
AndyLouis:

a lot of things look good on the surface but look a little closer and you're bound to find a problem within

And that is exactly how you make money in China, by identifying fake facades one at a time then position yourself accordingly to benefit from the fallout.

^ winner. China itself is just another nation trying to do it's thing...I do not buy into the hostile rhetoric promoted by the hard liners in the US who want another cold war. No one would win. The better solution is exactly what you're saying: look at the weak areas as an opportunity.

Personally, I see the US's efforts at building a security ring around China as preparation for when the citizens there decide to depose their government and institute a democracy. This could be soon alla the Arab Spring, or it could very well never happen, but why not be prepared. Trade issues are simpler and the posters above are correct: you tend to get what you pay for. They're a developing nation with massive dissonance between traditional and modern values, so I don't find it possible to make the sweeping overgeneralizations as OPs post. There's a lot of potential there, but you just have to keep an eye on them.

NO NATION can be trusted completely, it's why our founding fathers warned us of foreign entanglements.

YOU JUST GOT TROLLED
http://www.troll.me/images/red-foreman322/dont-you...

lil_barac's picture

depends what u wanna from

 
Points)
 on 6/6/12 at 11:19am

depends what u wanna from china. if u want them to keep making ipads, they are pretty darn good. if u want china to save the world, oh well, good luck.

u can't depend on anyone else but urself, same goes for u can't depend on any other country but ur own.

TNA's picture

HWF: This article is so

O
(Human, 13,489
 
Points)
 on 6/6/12 at 11:50am

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melvvvar's picture

this china threat is just an

(King Kong, 1,693
 
Points)
 on 6/6/12 at 12:11pm
Briefcase's picture

melvvvar: china couldn't even

IB
(Monkey, 36
 
Points)
 on 6/6/12 at 3:38pm
TNA's picture

China seizing Taiwan by force

O
(Human, 13,489
 
Points)
 on 6/6/12 at 4:16pm

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melvvvar's picture

china's already got a fifth

(King Kong, 1,693
 
Points)
 on 6/6/12 at 4:19pm

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