Toying With China
Brian Wingfield at Forbes Magazine has a story, entitled "Toying With China," on the recent Senate hearing on toy safety. Wingfield sees the hearing as "having less to do with safety concerns than with ongoing economic disputes with China." I agree.
Senator Sam Brownback (who not so coincidentally is running for President), told Nancy Nord, the Acting Chairman of the Consumer Products Safety Comission that, "What I want to hear is for you to say 'These [unsafe] products are not going to enter our shores,' He went on to say, "I think you have to just pull a heavy club out and say 'That's the way it's going to be.' " While you are at it Senator Brownback, would you please get someone to say that there will be 1) no more crime, 2) no more car accidents, 3) no more war, 4) no more taxes, 5) no more gossip, 6) no more Entertainment Tonight ragging on Brittney, 7) no more demogaugery. All that would certainly make me feel better.
The article then quotes me as saying, "China right now is the current bugaboo."
Mattel Chairman Robert Eckert spoke at the hearing and "apologized for the recalls but shifted much of the blame to subcontractors in China," saying, "We wouldn't be here if a handful of vendors hadn't violated our rules."
I close out the article with the following:
The toy issue is likely to be resolved through market solutions. Harris, who is also an author of the China Law Blog says American companies will have to perform better due diligence, including checking out potential suppliers before doing business with them, examining goods before they leave the factory and getting solid contracts in writing."Americans are really going to have to lead the charge by not dealing with bad Chinese companies," he says.
The toy issue is a politician's dream come true as it involves "our childen," "our safety," and the "evil Chinese empire," but the reality is that this is not really a U.S. government issue. I have heard (but cannot verify) that upwards of 50% of the Chinese companies exporting toys from China were either operating illegally or exporting illegally. At minimum, American companies must make sure the companies with whom they do business in China are legal (though this would not have helped Mattel). For more on what American companies can and should be doing to protect themselves from bad Chinese product, check out "CYA: China Outsourcer Protect Thyself."
And though I am always skeptical of the Chinese government's ability to police the quality of its manufacturers, I do note that a client of ours just yesterday reported the following:
The Xinghu area is under the microscope now. We have one vendor there who informed us they cannot ship our goods because they have not passed an inspection the government made without notice. Their shipments are flagged in Ningbo Customs. They told us the area has many toy mfgs and as such the government has moved into it.
We will see.


Comments
I had suggested low prices were 'the new bugaboo' back on Aug 22. Was the title of a response to the notion that quality problems were the result of low prices.
Posted by: Paul M | September 16, 2007 10:42 AM
But without demagoguery we'd surely regress to the 19th century and be subject to in depth debates of Lincolnesque proportions. No no no. I don't want to know my presidential candidates that well. When the esteemed Senator Brownback reminds me that China is bad for our children it shifts my limited attention span away from U.S. authorization to use military force somewhere or other, and right back to the most pressing issue in American foreign policy: tainted toys. Surely our politicians are not employing mass appealing rhetoric to wage an economic dispute with China?
What time does Entertainment Tonight come on?
Posted by: William Lewis | September 16, 2007 8:33 PM
China the "new" bugaboo? The exposed reality of what China is and the threat that the CCP poses to the human race is simply the proportional response to years and years of MNCs touting China as "the future!". Most readers have been to China and if that is the road we are on then please put me out of my misery right now.
Check out my link for the China's other new export which is of much higher quality: computer warfare, with hardware, software, money and training provided our friends the international IT industry.
Posted by: nanheyangrouchuan | September 16, 2007 10:40 PM
Brownback isn't exactly 'running' for president. He's barely speed walking. I'd call it 'loafing'.
Posted by: Dave | September 17, 2007 12:29 AM
nanheyangrouchuan:
I realize this is not at all what you meant, but I'm going to go with it anyway.
The CCP poses little threat to the human race. Heck, if the rest of the world's political parties could undergo the reform the CCP has undergone since 1978, the world might be a much more modern place.
As far as these recent IT attacks you allude to, these are but a part of the bugaboo. The U.S. State Department, alone, has its networks attacked 2 million times a day (Economist, Sept. 8, p. 62). Chinese attacks are merely a drop in the bucket, and we are only aware that they might be coming from China because our technological capabilities are so advanced. And besides, it is common practice to run and test simulations versus potential opponents in war. For what country has the United States not asked a think tank to run simulated military operations against?
China is simply an easy target for politicians in a run-up to an election because China raises irrational fears in the minds of many Americans, fears which are easy to play upon for voter support. McCain and Clinton are getting attacked by the media and opponents no matter what they say about Iraq, so they might as well join the non-partisan China bashing. Turning economic disputes into political disputes and accusing China of attacking US sovereignty will not solve any problems. Acting upon our fears of China, however rational, will only serve as a catalyst for conflict between the West and East, a conflict which need not be inevitable.
The nations of the world are now at two great crossroads, and the applicable one for this forum is how will relations between the West and East be defined for the next century. If we let an economic dispute boil over into a political dispute because of base misunderstandings between cultures, then we have learned nothing from the past 60 years.
Posted by: William Lewis | September 17, 2007 9:16 PM
This is a really great article. I too believe this can't really come through government action... except maybe not make china SO favorable... I think both the companies need to be responsible and the consumer needs to speak with their "demand" or "buying power".
By the way, I recieved an interesting letter on my blog from someone whose biz is in some weird legal trouble in china and was looking for a lawyer...
Posted by: mommy zabs @ notchinamade.net | September 20, 2007 1:05 PM
Dan,
A couple of weeks I met with some of the senior executives of one of China's largest ports, and they told me that the problem is so serious that they are going beyond the port to investigate manufacturers.
At first, this hit me as being a little much, but if you look at how many containers Mattel and others ship, it is a smart risk policy. Help your customers stay clean, and they keep shipping containers.
Now the interesting part that is coming out is that many of China's defensive remarks are being shown to be factual. that rather than lead paint and shoddy work being the core issue, it is often product design that is the issue...
Posted by: All Roads | September 22, 2007 12:08 AM
Has Everybody forgotten that
we are still at war with China and have been since
1951 when China joined in on the side of North Korea
along with Russia and China considers the US an enemy
and is willing to take on the US to bring back Taiwan
under its control. I would like to know why these
companies that have put money into China to increase
their own profit margin, have not been tried for high
treason for consorting with the enemy and giving aid
and comfort to the enemy? There is going to be a day
when China isgoing to Want Taiwan back andthe US is
going to have to go defend Taiwan as the treaty we
have with them states and China is going to do it with
US monies but a good thing is we dont have to worry
about that until after the olympics like the 1936
Berlin Olympics.
Posted by: John | September 23, 2007 6:39 PM
John:
Unfortunately many panda huggers in my generation are plain ignorant of history and many in Dan's and Chris D-E's generation are willfully ignorant of history when it comes to China. China also wants 30% of northern Korea and has adjusted its historical studies to justify such a "repossession".
The above parties like to hide behind a veil of "business is not politics" but they again conveniently forget that politics is about person to person as well as state to state relations and involves alot of human emotion. Thus, politics can never, ever be removed from consideration.
Posted by: nanheyangrouchuan | September 25, 2007 9:11 AM
The CCP ain't the one invading people on false WMD accusation. The CCP ain't the one droping Depleted Uranium dirty bombs on innocent civilians.
The cold war is over, man. I guess that's why folks like you must manufacture an enemy to justify your existence.
China is just a convienent target, a "wonton" of sort to you, right?
Posted by: Charles Liu | October 6, 2007 3:48 PM