“To get rich is glorious!”

First, It’s no surprise that Human rights and the environment are taking a backseat to economics. This is point of the 3rd world’s whole argument with any US/EU sponsored HR and Green legislation—“we’re decades behind you in terms of economics, we need to feed people first and then deal with the fall out (like you got to do).”  Yes, I understand the response that the ordered priorities maybe somewhat backward if we expect to have any future at all on God’s green earth.  But the point is, when push comes to shove IMMEDIATE economic needs are always going to win out—whether it’s global climate legislation or arguing about the additional levels of quality of any given widget.  Find where the money is and you’ll fix your problem much faster.For example… our current problem with colors in factory A.  We specifically asked that our supplier make molds and print screens in a certain order.  This order, we felt, would help to control color issues.  The factory didn’t do it, said that our process would actually make the product color look worse.  So they did it their way, despite our protests.  We finally agreed (not other choice) but only if they guaranteed the color quality.  To no ones’ surprise the colors are horrible.  The one sample that they made using our order/process was accepted and now the factory is looking at either a large percentage of rejected final product (using their process) or paying for new molds/screens now.  Of course, it’s not really an argument about color at all—it’s an argument about the cost of the molds and screens.  Ironically, if they’d done it the way we asked in the first place and if the colors didn’t work, we would have had to pay for the new molds/screens and not them.  But now, they are stuck—they can pay now, pay later or lose the order and return the deposit.  We knew this would be the problem months ago and so when they refused to follow our processes we had them sign an additional agreement that they’d pay for the new molds/screens if their way doesn’t work.  (What will really happen is they will refuse to do it right and refuse to return the deposit and we’ll end up paying for their mistakes since the order is too small to take to court.  And they know it.)I’m not usually one for mandating processes as long as correct outcomes can be achieved.  But sometimes, you know from experience when things are going to go badly down the line.  Sometimes you can see that someone’s face (us questioning the factory’s technical capabilities and suggesting different processes) is going to have financial impacts later on.

Side Note: “Very Difficult” vs. “Impossible.”  One of the distinctions I’ve learned to make in negotiations in China is the difference in what people can’t do and what they don’t’ want to do.  If the can’t do something, because they don’t have the machines or technical ablity or time or materials then there really is only one thing you can do: (“go through their pockets and look for lose change.”) make either spec or supplier change.  But the other issue is basic desire—whether for financial reasons or any other issues (and I would argue that there really aren’t any other issues) it’s just more effort then they want to spend—you have to convince or force them to see things your way.  This can be tough if you’re on a timeline and have already paid a deposit—in this type of situate they know they have an upper hand.  So they wait you out, not doing it correctly for a while until it becomes either too late ($) or too frustrating and you give in.  Regardless of what you think the end result will be, the question "is is difficult or is it impossible?" is, I think, a very valid and useful question.

Second, Gary Locke—Chinese American, former governor of Washington and now Secretary of Commerce.  (You can follow the money here too.)  First appointee was a faithful Democrat who got caught with his hands in the state-contract pie—this was a promised return on a campaign favor gone bad.  Second appointee was a conservative with budget and business experience but couldn’t get past the political conflicts with the Obama Whitehouse (surprise, surprise)—this was an attempt to get someone who knew what to do into the right position with as little political fallout as possible.So now, we get to Mr. Locke.  Locke is known for his support of Chinese-US trade at a time when it seems to be the most important economic relationship on the planet; Chimerica, as some are calling it.  Necessity is the mother of invention, or invitation in this case.  The word in Seattle is this (from a friend there):

“Nice guy.  Squeaky clean.  Honest and very earnest.   The only bad thing anyone ever says about him is that he is a lightweight.  I think he would make a very good Sec. of Commerce.  Doesn’t really know China all that well.  Doesn’t speak a word of Chinese and hadn’t gone there until he was Governor.  Doesn’t really know foreign policy that well either, but overall should be good for US-China relations.”

I guess we'll see what we get.  I hope that he was appointed because he knows what he's doing and not because he looks the part.25/Feb UPDATE: Here is another article on Locke from Seattle.27/Feb UPDATE: And another look at Locke, here.Third, when will China see the bottom of the recession?When Chinese learn to spend money like drunken Americans!Sure China has a big market.  Sure China has lots of savings per capita.  Sure China has limited debt and a government committed to say in power (e.g. keep the prosperity coming).  But even with all that cash and all those people the economic stimulus package in China will do little if the Chinese people don’t spend any money.  Like the banks not lending cash in the US, the Chinese consumers are not going to spend in an environment of fear.  They’ve had far too many bad experience; too many political wind changes to think that they can/should just keep spending as the seatbelt lights are flashing.  Of course, around the time international orders start to return and the environment gets a little more stable, the Chinese will start spending again—because it’s safe again.  But for now, just know that the Chinese domestic market isn’t going to save anyone.And, finally: Congratulations!!!To all those who voted for Obama because they thought that Bush made the US look stupid—welcome to the hot seat!  There is no way that the US looks any less stupid now than we did before.  And I’m not even talking about the most recent poll numbers, just the contents of the non-stimulus package.This week, leaders of at least 4 communist nations either directly or indirectly warned the US not to move toward the socialist and protectionist economic positions that were created in the non-stimulus bill.  That’s right—THE RUSSIANS AND CHINESE AND OTHER MILITARY DICTATORS ARE WARNING THE US NOT TO MAKE THE SAME MARKET KILLING MISTAKES THEY MADE.   How rich is that?!  Here's the highlights.1. Pres. Putin said the US "should take a lesson from the pages of Russian history and not exercise excessive intervention and economic activity in blind faith in the omnipotence of the government.”“In the 20th century, the Soviet Union made the state's role absolute,' Putin said during a speech at the opening ceremony of the World Economic Forum in Davos, Switzerland. 'In the long run, this made the Soviet economy totally uncompetitive. This lesson cost us dearly. I am sure nobody wants to see it repeated.”2. A Chinese Commerce Ministry Spokesman said: “China was deeply concerned about the decision by some countries to include clauses in their stimulus packages that prioritized the purchase of products from their own markets.”3. The Leaders of ASEAN (Cambodia, Myanmar, Vietnam, Lao, Indonesia, Malaysia, Singapore, Philippines, Thailand, Brunei) and some Asian Finance Ministers (and China, Japan, Korea) pledged Sunday to uphold free trade and investment in the midst of the global economic slowdown.  That’s right Communist, Socialist and Military Dictatorships just voted to uphold free market principles while the US plunges headlong into the recognized failures of socialism.Have you tried to have a conversation with Chinese people about the US economy lately?  Tried to defend either how congress (Frank and Dodd) forced banks to make bad loans or the pork in the non-stimulus package (that no Democrat who voted for actually read) to Chinese factory owners?  How about the bailout cash for auto companies and $29/hr.+ benefits-union-workers that haven’t turned a profit in decades or newly legislated programs/spending that will soon make the US dollar and the treasure bills the Chinese are buying completely worthless?  Want to discuss inflation and unrepayable debt to Chinese investors?Contrary to campaign promises, stupidity has been served up on a silver platter this last month—and if you want to argue, check the markets’ reactions to anything (and everything) Obama has said as President.  Yup, all down all the time, until the sun goes out.  Neither Obama or the Treasury Secretary get any bump when they speak--why?  Because the markets/investors don't believe them and/or know the plans wont work.All this Hope may just kill us.  But hey…that would be a Change, wouldn’t it?!  At least I still get an $80K tax break for living here every year….shhh, don’t tell Obama._________By the way, comments should work now.