China Crap  
 

I do not know why the Americans would ever need fear Chinese military superiority.

If China was to go to war with America I am certain that within the first month of the conflict, most of the Chinese soldier's boots would have fallen apart, half their rifles will have stopped firing and 60% of their bombs will fail to detonate as designed. - If they used their own products!

Well sure, I am exaggerating - but you get my drift.

Now I know the products that I purchased from China are cheap in comparison to those that are made in the country in which I live (Oz) BUT I always reasonably thought that this costs differential was as a consequence of:

  • the Chinese government holding down the exchange rate of the Yuan. - (1/6 of the the $AU); and
  • Chinese workers being paid an abysmal wage in comparison to their efforts. - (1/10 of a comparative US worker).

In the beginning I though this was the bases for their cheapness, I never realized, that these Chineese products were also cheap because they're were made with crap materials.

The materials in the products manufactured in China is not just lower quality, it is absolutely crap quality.

Apparently paying your workers almost nothing and having the government artificially hold down your exchange-rate is not sufficient inducement to becoming wealthy members of the party, you actually need to dishonestly manipulate the quality of the products you produce as well.

Everything from the the plastics, through to the glue, the composition of the metals, concrete and the fibre products is just crap.

And I really can't blame Chinese workers from not having pride in the products they produce. I certainly wouldn't have any pride in working for anybody that was deliberately and mercenarily exploiting me.

1 kilo of rice in Au is AU$1.52 in China is AY$0.44c. A ratio of 1 to 3.5 - but with an income 1/10 the AU income they pay only 1/3 the AU cost of living.

I know this is also simplistic - BUT this is not the point of this web site. This web site is about exploring the real consequences caused from China products that are just plain Crap.

 

 
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Let me explain - Why

 
 

Perhaps the 'Chinese Products' situation it’s not entirely based on greed and exploitation.

Perhaps it is a cunning strategy to destroy the economy of Western societies for purposes which are not yet entirely clear but perhaps global dominance by China may be a front runner.

I have yet to encounter any economist in my country who understands the destructive nature, to our the economy, as a consequence of quality of these Chinese products.

I’m not here talking about the destructive power of dismantling the labour markets and exporting job, by the import of cheap Chinese products, I am talking about the insidious undermining of the framework of the economics upon which my country’s stability relies.

Let me explain using Australian examples.

In the world of economics one of the major fears stressed by economists is the destructive capacity of INFLATION.

Fundly enough INFLATION is defined in economic terms as "... the decline of purchasing power of a given currency over time".

Economists way of determining INFLATION is to monitor '.. the increase of an average price level of a basket of selected goods and services in an economy over a defined period of time. '

In Australia, this monitoring of INFLATION is measured using an index known colloquially as the 'Cost of Living'.

The index that underpins cost of living concept, is generated by the Australian Bureau of Statistics (ABS) and labeled the CPI [Consumer Price Index]

The ABS monitors, at regular intervals, the PRICE of a selected subset (basket) of items (goods and services) consumed by the community.

The ABS assesses the change in the retail 'sale' price of the basket of items by using a weighting analysis, (the % each group comprise of the total cost of living - for a household) to determines how much the global price changes, has moved - either up or down and express this value in - the CPI Index.

Here however, whether by designed stealth or purely an accident, these Chinese product have introduced a pervasive 'dry rot' into the structure of this economic management system.

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Let me explain - How


Let’s take a products as an example of the application and implementation of the 'China Effect'.

Take a 'work boot' for example.

Prior to the invasion of Chinese products into the Australian market, a 'work boot' would cost you in the vicinity of $250. However the work boots made in China now retail for somewhere in the vicinity of $80. - A massive price reduction of 312%

This would not be of any consequence except for two important oversights.

The First is: -

The original $250 pair of work boots would have an average operational life of say 2000 days (5 years).The $80 Chinese equivalent pair of work boots, by comparison, has on average, an operational life of 180 days (6 months) - a massive reduction of 660% in cost expenditure efficiency.

You could however most reasonably argue- 'Well don’t buy the cheap crap'.

But, and here is the real crunch, I have for most of my life been a supporter of Dr. Matins boots. This particular company once had the slogan of ‘A boot for life’ and in general terms it was true (depending on how long you lived) but they were long-lasting boots and 10-15 years of was not an impossible ask.

Today 98% these Dr. Matins boots come from manufacture in Asia (China?) [Ref] and the most recent pair of Dr. Martin boots I purchased, is, at three years, struggling to carry on. - [Her Dr. Martins Split after 3 month]

 

Good quality alternate products to China crap are rarely available to purchase.

 

The companies that made them have bowed to the social obsession of "Purchase price is all that matters". and there businesses have long since either:

  • Gone broke; or
  • Packed up their manufacturing and gone to join the Chinese.

there is no alternative for many articles and items other than to buy Chinese.

But this is not just a story about Dr. Martin or in fact about boots or in fact about one segment of the manufacturing industry. This is a story about the multi strand impact on our economy by - "Made in China" syndrome.

In 2019 Australia imported AU$214.5 billion in products 56.2% from "Asia" with 47.3% of 'Asian' Imports coming "Made in China".[Ref].

In any event ‘Made in China’ is nothing more than a euphemism for ‘inferior products from poor manufacturing process and skills, using significantly inferior products.

The Second is: -

The above is bad enough but the bigger problem is brought about by the failure of the ABS to realise, understand and accommodate this ”quality” implication in it's INFLATION calculations.

In the 'work boot' example above, the fall in the price of 'work boot' item ($250 down to $80) would have brought a downward influence for the calculation of INFLATION thus reducing the (inflation) rate forecast by the CPI.

However, the Cost of Living expenditure on essentials, (work boots) irreverently increases several factors over the calculated CPI rate because instead of having to spend $250 on work boots over 5 years ($50/yr) you now spend $160 a year (2 set of [email protected]$80/set) OR + $800 over the same 5-year period.

This increase in cost of living goes undetected by the current ABS/CPI system.

Thereby not being utilised by the Institutions making financial decisions, (e.g. RBA) based on this flawed CPI information and thereby significantly affecting, the Australian community/economy.

It is however reasonably understandable as to how this happened, because for the 20th Century, when the system was constructed, the system has been comparing (from a standards perspective) - 'like with like'.

Most products consumed in Australia in that Century and which form part of the ‘basket of consumer goods’ were built to the same PERFORMANCE standards because they were ALL made in Australia and the only fluctuations in PRICES were caused by either:-

  • (for Goods) :
    • packageing QUANTITY of the unit sold.
    • AVAILABILITY.
  • (for Services) :
    • labour SHORTAGES.
    • changes in TECHNOLOGY use..

but there was NO component of the assessment process that applied itself to the QUALITY - particularly in relation to wearing..

 

The consequence of these two circumstances :

  • "The massive importation impact of not just the low-cost but poor quality Chinese goods"; but also
  • "The failure of the ABS to understand the implications of this event for our economic systems ",

was this it had a very serious flowon because at a bureaucracy level, (i.e.the Reserve Bank of Australia) using the inflation figures produced by the ABS (which in reality has become disconnected from the Cost of Living and did NOT correctlly reflected the Cost of Living but none the less resulting in them (i.e. the RBA) applying inappropriate monetary policy, and thus finally resulting in significant increases in social stress within our society and building up pressure in markets such as housing; equity and finance.

 

The effect of following a flawed CPI system with it's rollon effect for the management of the rate of INFLATION,

has been that household expenditure (cost of living), for the same 'living standards', has been risen exponentially for some time now but has gone un-acknowledged by the SYSTEM thus resulting in wage growth suppression, (supported by the CPI argument) and ultimately resulted in high social pressure and the perfect economic/social storm.

 

 

Something had to give! and It did!

 

The 'standard of living' has fallen.

 


 

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