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Dell To Leave China For India
halfEvilTech writes "India's Prime Minister, Manmohan Singh, told the Indian press that Dell chairman Michael Dell assured him that Dell was moving $25 billion in factories from China to India. Original motives were cited for environmental concerns. But later details come up as to Dell wanting a 'safer environment conductive to enterprise.'"
If Dell can guarantee their parts are made in India and not China, I just might be getting a Dell next year.
Dell spokesperson denied the story this morning. Who's editing today, me?
a 'safer environment conductive to enterprise'
Read as "safer from industrial espionage and nationalization"
So instead of American jobs being outsourced to one dirt-poor foreign country they'll be outsourced to another. Total significance to the American worker and the American customer -- nothing.
Kwisatz Haderach
Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
Oh wait, that was their Customer Service department. I wonder how that experiment went ;-)
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Who is declaring the metaphorical war against whom? Are you saying China declared war on the multi-national corporations by hacking them?
I think they're just recognizing that a communist government is a bad environment for a corporation, despite extremely low wages. China will enforce its laws only when they suit China. If you build something there, don't expect them to shut down factories producing knock-offs of your designs. And if the shit ever hits the fan, ALL your investments in China will become the sole property of China.
That was never an ideal business environment. China was an interesting experiment, but any big corp is wise to limit its ties to the ironically-named Peoples' Republic.
A slashdotter who didn't build his own computer is like a Jedi who didn't build his own lightsaber.
Sure that wasn't "conducive"? I know Dell is an electronics manufacturer, but the company itself is likely non-conductive in the first place.
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We don't need China. It's just nice to have cheap stuff, and they make stuff cheap. If no one was buying, they couldn't sell. Its kind of like economic mutally-assured destruction. Despite what the Reaganites may want us to believe, demand still has just as much power as supply.
Wonder how many more US companies are going to pull out of China. First google, then godaddy, now Dell. What happens when all that China has left, is China?
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India safer? In some ways I suppose but it depends on what you are talking about. The Indian government is less draconian and less likely to try to compete with you. Expropriation is probably less of a concern in India. The rupee has somewhat better convertibility than the yuan and currency flows are less stringently controlled. Plus there is a much larger contingent of English speakers than in China. India's legal system is slightly less hostile to foreigners than China's though both are to be avoided if possible. Freedom of speech is obviously better in India though China doesn't have quite the death grip on speech everyone here seems to think they do.
On the other hand, India's infrastructure is badly trailing that of China, there is less foreign capital to improve things, corruption is a huge issue in India, business regulations are as bad if not worse than China, and transport costs are somewhat worse. Despite the number of engineers, India has less experience with certain types of manufacturing. India is a democracy (which is good) but that doesn't always make doing business there easier - in fact it often makes it harder due to populist policies.
There has been something of a "gotta be in China" attitude but China isn't always the best place to make things. There are places with cheaper labor (Vietnam for instance) and places with better logistics (Singapore) and places with expertise silos (Japan) that might make better choices. Plus betting everything on China is risky by itself. Doing business in China is hard, risky, requires constant oversight, and a long term perspective. Anyone thinking they can just produce stuff cheaply in China with little difficulty is going to lose a lot of money very quickly.
I've done global sourcing in both countries - it's difficult no matter which way you go. I've personally been in a factory in Chengdu where parts for Dell computers were being assembled. Moving production from China to India might be a good idea from a diversification standpoint (bad idea to do everything in China) but it's only marginally safer in my opinion depending on exactly what one means by safer.
When since the death of Mao and the rise of the "Gang of Seven" has anyone thought China was Communist? That is like calling the old Soviet Empire a Communist state. They are a totalitarian dictatorship. Just 'cause they call themselves commies, that doesn't mean they are. To quote I-don't-remember-who (maybe Hunter Thompson?) "Communism has not been tried and failed, Communism has not been tried."
Please don't dominate the rap, Jack, if you got nothin' new to say.
Do you have any understanding of the population of China? I think they will sell those good just fine without the USA, the EU or Africa for that matter.
Yes, they can sell to themselves, which is a closed population, which has demographic policies which ensure that they're going to have more old people than anything else in the mid-term, and those old people aren't really going to be productive. The only way capitalism works is if it can keep growing, which means that they have to start expanding into new markets, if possible -- otherwise, the system chokes on itself. It doesn't work closed in, just the same as Communism -- it wouldn't really work in just one country. In the 19th century, this brought us imperialism. In the 20th century, it brought us two world wars, followed by the cold war. If the rest of the world just stopped buying China's crap and kept trading with each other, freezing them out, we'd do a whole lot better than they would.
You may not realize this, but Taiwan is part of China.
The truth of that statement depends very much on whom you ask. As things stand Taiwan is de-facto an independent country. The People's Republic of China (mainland) maintain that Taiwan is a part of China, whereas the Republic of China (Taiwan) maintains that they are actually the legitimate government of China and that the PROC has no sovereign authority. However Taiwan has had to take great care to not antagonize the PROC due to the threat of invasion.
In other words, it's complicated.
It is my pleasure to be helping you today. I understand you are trying to move your factories from China to India. Just a moment and I will bring up your account. Ok I will look up moving your factories from China to India in our knowledge-base. Have you tried plugging in your factories?
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Do you have any understanding of the population of China? I think they will sell those good just fine without the USA, the EU or Africa for that matter.
No they wont. The high end products they produce cheaply cant be purchased by their own people because their own people don't have the wealth to pay for a high end good such as an iPod, tv, computer. This is why they have a ton of cyber cafes everywhere.
Also they might have a large population but a good portion of it is in the country where they live on farms and don't have a use for a high end product such as a TV or iPod because they don't have the infrastructure to support it.
The only reason China has been doing so well is because they cut corners everywhere. Cheap labor, cheap resources, disregard for implementing proper environmental laws, anywhere they could cut a corner they would. Compare a Chinese built automobile to a US / Japanese / European. The Chinese car will be extremely cheap compare to other countries but would disregard any safety or environmental standards.
Well what's communism then if not Soviet communism?
Intellectually, in the ivory tower, and in the history books, sure I know that Soviet Russia wasn't ideally communistic. It didn't adhere to communist ideals. But I didn't think that anyone agreed what those ideals were. Given that Soviet Russia is the primary example of communism, and that everyone associates the two together, I'd argue that here in the real world, they have defined what communism is.
If you want to take another stab at everyone chipping in for the common good, feel free, but get yourself a different name.
And companies aren't leaving China because the people have cast off their classist ideas about money and pay, it's because of the controlling and backstabbing government. Which is why it's fitting to call China a communist government.
To be more accurate, no corporation has ever tried to make anyone else rich. That the corporations boost the Chinese economy is a side effect they couldn't care less about; their aim is to produce something for the lowest cost possible and sell it for the highest price possible. China's ironically utterly capitalist approach to worker's rights and environmental protection means the cost is lowest there. That made it attractive to corporations.
But there are hidden costs from industrial espionage, arbitrary unpredictable actions by the government, poor safety guidelines (thus bad quality control) and the consumer backlash for exploiting lax pollution&employment laws. If these hidden costs grow too great, corporations will pack up and go elsewhere.
They can't afford to pay the wages/benefits and ALSO pay their C*O's assloads of money.
No sig for you!!
"Totalitarian dictatorship" doesn't really capture the aspects that have changed(and significantly). You can be a "totalitarian dictatorship" on top of virtually any economic system(other than the ones that are too unproductive to support any sort of central government with real power). You can run a practically free market with surprisingly little political freedom, and some totalitarian dictatorships have. To run a serious command economy, you practically have to be a totalitarian dictatorship, so most planned economies are.
China has been substantially authoritarian for pretty much its entire modern history. The interesting change is the shift from being an actually-substantially-communist economy to being a de-facto-capitalist economy, with substantial elements of state ownership and cronyism(the former in a variety of locations, especially those deemed strategic, the latter particularly notable at the local level). The multinational corporations who flock to China to build stuff on the cheap would Not be welcome in an actual communism, and are only getting cold feet now because they are learning the costs of dealing with cronyism and weak rule of law.
The USA, it's safer and conducive to enterprise, and with the economy in the pits a great time to negotiate with state governments, not to mention the karma factor Mr Dell.
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You have a point there, but that last part, about cars. As a European I can say the same thing to any American... In the end, it depends on your own standard. And no way china will stop exporting. So many countries depend on them... Look at what they are doing with Africa, instead of just donating money, they create jobs... Generate income for the people there... and then sell them their services and goods. No if I would have to put my money on 1 country to come out as the next World-Dominator it will be China on the short run and India as a close second, maybe even the leader in about 40 years. I definitely would not put my money on the US or EU cause well... we both are practically bankrupt. lol.
China doesn't sell us anything...
Lenovo will be very surprised to hear that. So will lots of other Chinese companies that you just aren't familiar with yet.
Thanks! Thought I was signed in but oh well...
To quote I-don't-remember-who (maybe Hunter Thompson?) "Communism has not been tried and failed, Communism has not been tried."
That's like saying true perpetuum mobile machines have never been tried, only bad implementations have been.
Ok, then: countries tried to try it, and failed. Every single time, soon after embarking on the road towards it, it always devolved into dictatorship. True communism cannot properly be tried on a society scale, because it's fundamentally against human nature.
Taiwan follows the old government that existed prior to the "cultural revolution" that spawned the current Chinese Communist Party government.
When you say cultural revolution in the context of China, you are actually talking about a fairly specific event that occurred long after the civil war that resulted in the schism between Taiwan and mainland China. The Cultural Revolution occurred in the late 60s whereas the KMT's retreat to Taiwan occurred around 1950. The communist party in China preceded the cultural revolution.
When since the death of Mao and the rise of the "Gang of Seven" has anyone thought China was Communist?
Someone called present-day China something like "the world's first mature fascist state", by which I assume they meant something akin to Mussolini's original definition where the interests of the state and of business were closely associated and effectively one and the same thing.
It has also been said that China went straight from being a traditional society to being a corporatist one without going through the transitional democratic phase. At any rate, those in power in the West thought that encouraging capitalism in China would inherently result in greater democracy over the longer term and in them moving closer to the West. Both of which are now very questionable if not downright wrong.
Assuming they meant that of course, and it wasn't just them exploiting the "capitalism == democracy" sentiment in the West (particularly America) to justify the cheap labour and potentially huge market they were salivating over, and damn the long-term consequences, which- blinded by dollar signs- they probably assumed would be in their favour anyway.
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Soviet union was totalitarian socialism, it's supposed to be a stage on the way to communism. Never made it there.
Human nature being what it is, I would argue that no "communist" government will ever reach that point.
The higher the technology, the sharper that two-edged sword.
Communism has the word "common" as it's root. It means common ownership of property, which is the same thing as non-existence of property (because property is defined by exclusive ownership). This implies non-existence of money, non-division of people into classes and impossibility of political power like we understand it.
Neither Soviet Union nor Maoist China had common ownership/non-existence of property - they had state control of property, where all the riches of those countries were managed by the bureaucratic ruling class. This ruling class forced people to work for money. There is absolutely nothing communist about exchanging work for money. Unlike entrepreneurs in free-market capitalism this bureaucratic ruling class managed their property collectively, but that is not so unusual - shareholders and corporations also manage property in common. What matters is that they have exclusive power which left most of people in those countries with little choice but to get a job and try to join the property managing class.
You might say that China and USSR had "realistic" communism, but this is not true because much more authentic forms of communism have existed in history. Many groups of hunter gatherer people often and share what they managed to find among themselves freely (or according to rules of gifting, not exchange). Diggers during the English Revolution (around 1650's) were a group that set out to work the land in common and share the products freely. The government rightly saw them a s a threat and suppressed them. In the Spanish Civil War in 1930's large parts of the country were controlled by anarchist-communists (several million people) who took "from each according to the ability to each according to need" principle seriously and collectivized factories and land. Their progress was uneven, but mostly it was directed towards greater communism. Their enterprise was prosperous until they were destroyed by the combination of USSR sabotage and fascist attack. There's a movie about it called "Living Utopia" if you care what real communism looks like. Wikipedia is another (very limited) communist project because it creates common wealth owned by no one and build by people who have the ability (and desire) to do this and used freely by anyone who wants to use it for the benefit of all.
Finally, there is nothing communist about stuff like "collective farms" in USSR because those enterprises were not controlled by their workers in any meaningful sense.
What these countries call themselves makes absolutely no difference to what they are. They are state capitalist economies because they have states, capital and a powerless working class, while communism is a movement (and not just some ideas in a book) aimed square against all of that. It would be nice to have a new word for people chipping in for common good as you say, but if this chipping in behavior was at all ambitious it would threaten all the existing powers of our world (governments & corporations) and sooner or later it would gain the same notoriety as "communism"
A much better example of communism would be the short-lived anarcho-communist Spain. Real communist states are often short-lived and collapse into oligarchies or dictatorships due to the instability of the country post-revolution. Spain was a working but short-lived example of the closest thing there has been to communism as advocated by Marx and others. George Orwell traveled to Spain and fought alongside the anarchists / communists there, against the fascists.
Spanish Revolution
Confederación Nacional del Trabajo
For all the right-winger paranoids who like to quote Orwell, it might be interesting for them to learn that he was a socialist fighter in Spain, who recorded his experiences there in Homage to Catalonia.
Systemd: the PulseAudio of init systems
I can't speak for "everyone"; but I'm not using the term because "fascism" also has a number of salient and distinctive cultural features that distinguish it from other flavors of authoritarian or totalitarian and capitalist society.
Fascism, while annoyingly mutable and difficult to pin down, is more specific than Totalitarianism, which is itself more specific than Authoritarianism. The three are(roughly speaking) visualizable as a set of concentric circles, with fascism in the middle, totalitarianism around it, a little ways out, and authoritarianism outside that, again a way further out. Each time you go in one ring, you exclude certain forms of political organization. Just to make things hairier, neither Fascism, nor Totalitarianism, nor Authoritarianism have neat links to specific economic models. There are some implications and exclusions(for instance, you cannot run a command economy on a national scale without a political system that is Totalitarian in character, you cannot run a Totalitarian or Fascist political system without an economic system and technological base capable of sustaining centralization, and self-identified "fascists" will oppose self-identified "communists" and vice versa); but no neat one-to-one correspondences.
Consider, for example, a Fascist Totalitarian Capitalism vs. a non-Fascist Totalitarian capitalism: let's say Fascist Germany vs. one of the hard-right "banana republics" established by US interests in South America. In both cases, "communism" and "communists" will be explicitly rejected and violently suppressed. In both cases, a form of capitalism will be the economic mode, albeit(because of the totalitarianism being rather corrosive to rule of law) with certain amounts of cronyism creeping in. Look at the differences, though: In a fascist state, the espoused aim of the crony capitalism will be restoration of national greatness in the face of perceived degradation, humiliation, or decay(seen as brought on by some combination of liberalism and external forces plotting along with internal enemies). In the banana republic case, the aim of the crony capitalism will be the enrichment of a foreign corporation or corporations, who in turn kick back a slice of the money to the local strongmen who keep riots to a minimum and the proles in line.
In the Fascist arrangement, the cronyism is seen as a bargain, mediated by the totalitarian state, between the power of industry and the "People"(in an ethnic nationalist sense, not a communist "proletariat" sense). In order to restore the glory and (military) power of the nation, strategic industries will be favored, and any leftist labor movements that inconvenience them will be intimidated, beaten, or sent to the showers; but the bargain is seen as a populist one: the favored industries enjoy substantial perks; but are supposed to be bound to the national interest, not to profit maximization. Layoffs to please Wall Street would not fly in a Fascist state.
In the "banana republic" arrangement, the cronyism is an bargain, more or less explicit, between an external corporation and the local elites. The bargain is, the local elites keep order, protect the property of the crony entity by force, and crush any labor movements that are seen as threatening. In exchange, they get a cut of the profits(without having to possess any technical capacity themselves) and all the usual perks and pleasures of power. Not only is this arrangement not about "national glory", it is exactly the sort of humiliation that can make (depending on conditions) either fascist or communist economic populism compelling. If the local elites feel sufficiently mistreated by the outside entity, and have some sort of cultural mythology to draw on, you may see a fascist reaction. If the local elites are too weak or lack any useful cultural mythology, and the lumpen proles are too bitter about their obvious economic oppression, an attempt at commuunism may occur.
Given that China does have a strong cultural mythos to draw on,
Yes and no.
It simply isn't possible to be "Totalitarian" unless you can, in fact, centralize the levers of power in a political unit into the hands of a Supreme Leader(and, in practice, his cronies and right-hand men). Otherwise, you might have a sort of autocratic feudalism, where the King can do whatever he wants; but he has to ride right over to where he wants to do it, with his sword and his cousins, and wherever he isn't, some nobleman holds sway; but you won't have a "Totalitarianism". To do this requires substantial resources. Bureaucracy, guns, mass communications, transport assets, etc. If you don't have those, you can't have "Totalitarianism".
On the other hand(and this is where Papa and Baby Doc, and the poor bastards in Haiti come in); because of globalization and trade, you don't have to be able to generate those resources internally as long as you have some means of buying them. In the case of Haiti, a mixture of exploiting US/Soviet tensions for handouts, misappropriating aid money, and selling off timber concessions, provided those means. This is how, while Haiti itself didn't really have an economic system productive enough to support much of anything, there was a sufficiently productive economic system feeding the Duvaliers.
Nations with natural resources that are either trivial to extract, or easy enough to extract with foreign technical assistance, are commonly vulnerable to this pattern. Anybody who can gain power(usually a charismatic populist who wins the last real election, or an ambitious soldier with some guts and a lot of luck) can then bankroll a Totalitarian regime by strip mining, or selling the rights to strip mine, the place and buying the materiel he needs from outside, and the support he needs from inside.
Perversely, this often leaves such nations worse of, even compared to other repressive regimes. Trujillo, say, just next door in the Dominican Republic, was every bit the Totalitarian bastard that Duvalier was, if not worse; but the DR is way less fucked today than Haiti is, in no small part because Trujillo spent much of his reign building wealth(and then concentrating it in his own hands, of course). While Duvalier sold the place off to pay for his regime, Trujillo had soldiers gunning down the poor people who attempted to enter "his" forests to try to make a living. Serious dick move; but one of the reasons that the DR hasn't had all its topsoil wash into the sea.
This is sort of the mean, ugly, step-child of the idea that free trade and globalization will spread political freedom to go with the economic freedom:
Traditionally, a dictator's ability to run the place into the ground was limited. If you don't pay the soldiers, they'll have your head on a pike. If you can't afford to arm them, the starving mob will drive them off, and then have your head on a pike. If your infrastructure rots, you'll find yourself ruling an area of about a week's march from your palace, and nowhere else. To succeed as dictator, you pretty much had to keep at least the economy going(doesn't mean you can't torture lots of people, or disappear your opponents, or have your pick of children delivered to your palace pleasure-pits daily); but does require that society function to a degree, that there be some amount of rule of law(even if it only applies to petty criminals, not to grand ones like you), and so forth.
In a global economy, by contrast, these requirements only hold if your country has literally nothing worth mining, or selling off, or otherwise exploiting. If you do have something, you can always find somebody willing to hold their nose and do business with you. If your resource is merely valuable(diamonds or teak, or cocaine, say) you may have to deal with various more or less shady characters. Criminal syndicates, scruffy ex-easter-bloc arms dealers, that sort of thing. Not a crippling problem, "Pecunia non olet" and Kalashnikovs work just fine once you brush the dust off. But if your resources are strategic, boy, you are golden. Run a virulently repressive theocratic monarchy? If you will sell oil, the US will be your best buddy, sale of advanced weapons included, no problem.
well, not like western governments are that much better to deal with ...
for every action there is an equal or opposite government program
You cannot create a totally free market under a Totalitarian Dictatorship, it is true; but that isn't really of much economic relevance. "True Free Markets" are about as common as "Real Implementations of Communism". They aren't creatures of the real world. However, there are some real-world structures that substantially approximate, and reap many of the benefits predicted for, "free markets". Unfortunately, it is possible to create those while also enjoying a substantial degree of political control. If you aren't a klutz about it, you can have your nigh-absolute power while leaving most markets mostly undistorted, most of the time, and thus enjoying most of the benefits.
Slightly less free market; but probably even more dangerous to freedom generally, is the fact that you can strategically distort the market such that obeying and supporting your power is a rational profit-seeking act for most market entrants. That is where the old command-and-control guys missed an opportunity and(unfortunately), the contemporary authoritarians don't seem to be making the same mistake.
Ditto for "capitalism". Idealism is always foiled by human nature. The best systems I've seen are a mix of elements.