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China Steals Jobs! -- and Other Myths About Business in Asia

If you think China is the enemy of American business, think again.

I did some rough math and figured I've spent something like half a year of my life in airplane seats going to, from, and around Asia, both as a manufacturer/importer and as an exporter. For those who haven't had the experience, everything you've heard about the mind-numbing 15-hour flights, the "culinary challenges," and long nights of drinking and karaoke is true. But much of what many people believe, or have been led to believe, about the impact of Asia -- and in particular, China -- on our own economy is not quite as accurate.

Here are the 3 most common myths, exaggerations, factual manipulations and misunderstandings:

1. China is stealing jobs: Work is leaving the United States, for sure. But not because it's being "stolen." Work moves around for many reasons -- competitiveness, the changing makeup of our economic output, taxation and other burdens, and often a shortage of people who want to do certain types of work. The West is morphing from a manufacturing base to a service and intellectual base, and the East is picking up what we leave behind. There is no denying our huge trade deficit, but another little discussed fact is that even when American companies make goods in China, most of the money stays in our own economy.

2. We need to protect against "unfair trade." Nature abhors a vacuum, and so does Capitalism. As long as there are customers who want to pay less, there will be companies and countries that will meet the demand. If not China, there are many more emerging nations waiting in line. In fact, labor rates in China are skyrocketing as the country becomes much more of a consumer nation, so the scene is evolving as we speak. Trying to stop that natural process may benefit a U.S. worker, industry or interest group, but at the expense of millions more people by limiting their choices and the degree to which they can afford the products they want.

3. Chinese factories are sweatshops full of underage workers. I've visited countless factories in China. Many aren't pretty, even the best don't look like what we are used to seeing here. Some are downright depressing... to an American looking from the outside at a developing economy. But in 20 years I've never seen children working in a factory.

I am not so naive as to suggest there are no sweatshops and no child labor -- of course it exists, and not only in China -- I'm just saying it is not the scene that some would have you believe. Good American companies find and hire good Chinese factories to make good products every day. And if you really want to take the humanitarian stance, taking work away from developing nations only makes the lives of its workers worse.

I'm not being a cheerleader for China. But the bitter pill -- the one nobody wants to swallow -- is that we consumers dictate the path of capitalism. We often don't want (or can't afford) to pay the price of the goods for which we want to be well-paid to manufacture.

Look no further than Walmart's famous "Buy American" mantra, and how quickly it went by the wayside because it opened ears but not wallets. Now Walmart is one of China's largest single trading partners, well ahead of most entire nations. Customers demanded and created that, not Sam Walton, not Jiang Zemin or Hu Jintao.

My company makes bags. Nice ones, if we may say so. For years my family made bags here, in our own sewing factory. But just under 100 percent of the products in my industry are now made offshore, the vast majority in China. We consumers all love to talk about "buying American" but we won't often pay the premium. So as my industry became ever more crowded and competitive, I had to make a decision about what would be most likely to keep my company viable.

It would be a dream come true to make products here again, and in fact I hope to, but If I brought all of that work back here today I wouldn't make it through the year. So for now, my American company survives, supports American jobs, and feeds American families because China -- like it or not -- makes it possible for us to sell our goods at prices other Americans want to pay.

Oh, and by the way, I sell stuff in China too.

(Flickr photo by K. Kendall)

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