China Comment

Energy, Environment, and Economy

Isn’t That Odd? Segway Scooters

Isn’t That Odd is an occasional feature that aims to provide insight onto the Chinese psyche by pointing out particularly Chinese ways of thinking.

Segway Scooters, which in America cost about $5,000 on ebay and $4000-$6000 as of 2006 according to USA Today actually cost more in China- to the tune of $10,000!

Why do they cost so much? They have to be imported, and aren’t manufactured in China. In fact, they’re at a plant of a company based in New Hampshire.

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Still… Couldn’t costs go down? Isn’t it surprising that they cost so very much more in China? According to the International Herald Tribune Article, Segway doesn’t want to move to China since it’s afraid its technology will be stolen by Chinese manufacturers. Well, they may be too late to prevent that. It appears copies have already begun emerging.

And as for the Segway name, which I believe is trademarked. It might have already been appropriated by a Chinese company making a remarkably similar product it calls “Segway scooter” (I suppose “Segway” is used in a similar manner as “Kleenex” is used when referring to tissues)

Compare this picture of a Segway on the Charmbright site Charmbright Segway Scooterto the ones on the real Segway site. Not being a Segway expert I can’t say whether the Chinese version is a copy, whether they are retailing the Segways on license (which I doubt since the Segway site has no mention of a “Charmbright.”). 

Charmbright’s listing says they are a “Manufacturer, Exporter, Agent” of Segway scooters from “Industrial Park, Jinhua,, Zhejiang, , China [CN]” which implies that they are creating them from scratch. Their post is quite recent; it’s from Apr 14, 2008.

So what is Charmbright? from their site: “CharmBright Limited is a professional manufacturer of sports products, marine products, fitness equipment and outdoor products. Our production line currently includes ATV, Dirt bikes Go karts, Scooters, Outboard motors, Inflatable boats, Trampolines, Pro-Jump, Waterbird, Skateboards, Fitness massager, etc.”   

Someone at Segway should probably check this out, for IP reasons.

7 June, 2008 Posted by | China Business, Isn't That Odd? | , , , , , , | 3 Comments

Off the Shelf: China and Murphy’s “Are We Rome?”

Off the Shelf: An in-depth look at something I am reading.

Are We Rome? (2007)
-Cullen Murphy, managing editor of the Atlantic Monthly.

Murphy’s examination of how America’s experience of “empire” compares to Rome’s empire can lead some to question if America is in danger of crumbling? This led me to examine causes for worry that American hegemony might be at an end, and to see whether or not China possessed some of America’s strengths and weaknesses.

Murphy describes traits of successful empires. He notes the importance of technology and innovation, and the spread of culture. He complains about political patronage, American exceptionalism (Manifest Destiny), and argues that privatization induces corruption and helped lead to Rome’s decline.

TECHNOLOGY/INNOVATION
Technology and innovation in China still lags behind that of many developed countries, Nicholas Lardy of the Brookings Institution would argue. Although patent applications are up and the number of college graduates continues to rise, the quality of the graduates is hampered due to less-than expert teachers. When programs increase enrollment five or tenfold in size within a decade, either more students are packed into a class, or less knowledgeable teachers are paraded onto a stage.

As of 2005, America and Japan lead the world in patents by a large margin. with 186,000 granted to Japanese, 135,000 to Americans, 64,000 to Koreans, and 21,000 (6th on the list) granted to the Chinese. In terms of Engineering graduates, in 2004 the US graduated 137,000 students with Bachelor’s in Engineering degrees; India graduated 112,000; and China, 354,106. “In terms of degrees awarded per one million citizens, the United States awarded 758 degrees; China, 497 degrees; and India, 199″ (National Science Teachers Association). Additionally, some “Engineers” graduated by China may be the equivalent of motor mechanics and industrial technicians (ibid).

However, 20-30 years down the line, after constructing a more robust learning supply-chain, China’s educational investment might begin to pay off significantly. According to the Economist; “By 2015 its research scientists and engineers may outnumber those of any other country. By 2020 it aims to spend a bigger share of its GDP on research and development (R&D) than the European Union.”

CULTURE/ASSIMILATION AND WEALTH DISTRIBUTION
Murphy claims America, like Rome, draws power from immigrants, but he notes that some places with high levels of multicultural variegation, such as California can become anarchic amalgams unless care is taken to instill a sense of civic responsibility and lower the wealth distribution differential.

Currently, the United States confronts rates of CEO pay at 430 to 1 where back in the 1960s they averaged of 25 to 1 of an average workers’ salary. The Ancient Romans suffered rates of 1000+ to 1. However, China also confronts a significant wealth distribution differential with a Gini coefficient only .03 points lower than the US’ (More Detail Here).

Indeed, the 2008 unrest in T*b*t can be partially attribuited to “unfair” Han Chinese exploitation of the region. The report, “No One Has the Liberty to Refuse“, written in June 2007, demonstrates how the 2008 protests originated for reasons other than alleged “cultural repression” (An Audio Clip is available HERE; A shorter article is HERE). Thousands of T*b*tans have been relocated into the cities, where they cannot find work, and where they compete with Han Chinese for jobs. Life has improved in T*b*t in the past decade, with an economic growth rate over 12% for “six consecutive years,” government-subsidized schooling and social programs. However, new Chinese immigrants whose numbers were buoyed by the 2006 rail line, have begun to culturally and economically colonize the under-developed region.

Immigration and tourism- seeing millions more than before the rail was opened- create a culture clash potentially much more deadly than the one in California forecasted by Murphy.

PATRONAGE
Murphy then complains about patronage through a focus on Pliny the Younger. He laments the appointments (suffragium) in the government based on connections in both ancient Rome and modern America.

However, as any scholar of China will be quick to note– China is notorious for the practice guanxi and an almost religious attraction to “patronage-like” associations based on friendship rather than efficiency. 

Ultimately, most, if not all countries suffer from overriding patronage; from Britain’s old boy’s clubs, to the French ecole class of Administrators, to America’s old Ivy League elite.

There is always a danger if patronage appointments are completely unaccountable; but disasters have a way of dismissing incompetent leaders. For example, Hurricane Katrina led to the downfall of Michael Brown, and China’s SARS crisis allowed Hu Jintao and Wen Jiabao to demonstrate courage and leadership by staying in Beijing during the crisis; while other leaders, notably members of Jiang Zemin’s clique,  left Beijing on trips to SARS-unaffected provinces. Arguably, Hu and Wen’s actions helped strengthen their political capital to the detriment of Jiang’s “Shanghai Gang” which has since seen members such as former Shanghai Party Boss Chen Liangyu sacked for corruption.

AMERICAN AND CHINESE EXCEPTIONALISM
The Middle Kingdom long enjoyed a position as the center of the East Asian world. Diplomats from as far as Vietnam and T*b*t would kowtow to the Emperor. This position changed after the 1860s and the Opium Wars. But now, the Middle Kingdom is trying to get back at the world’s center. China’s naval developments and interest in ports at Gwadar, involvement in the ASEAN+3 grouping, establishment of the SCO (Shanghai Cooperation Organization), and greater involvement in the UN peacekeeping operations demonstrate an increasing willingness of China to act internationally. [A forthcoming article will examine these assertions.]

PRIVATIZATION OF MILITARY/CORRUPTION/HOLLOWING OUT
Murphy also discusses how contractors and privatization of American military are hollowing out America’s defensive spirit in much the same way mercenary barbarians contributed to Rome’s downfall. The contractors’ training and standards of justice are allegedly dissimilar from those upheld by the American military.

China seems to escape the problem faced by America; its cyberterrorism/cybersecurity is controlled tightly by the government. In contrast, even United States’ Government’s systems are outsourced to private companies- thus the spat over a proposed Huawei/3M merger.

China’s military problem appears to be not that it outsources its military development, but that it doesn’t have good enough internal development. C4I and equipment integration, as discussed in books on China’s military by James Mulvenon and David Shambaugh, are better in America and other developed countries. China also purchases many ships and airplanes from Russia instead of through internal construction. As China develops its home defense industry, this problem might dissipate.

CONCLUSION

Ultimately, Murphy presented an intriguing historical comparison of American “empire” and Roman. He identifies weak points in America’s government and military and raises calls for concern. But although China lacks several of America’s weaknesses, it still confronts remarkably similar obstacles and has many of its own challenges to overcome.

Murphy’s book is recommended for general readers, and for those interested in America’s position in the world. It never mentions China, but in an internationally anarchic system of diplomacy, the loss of power for America might well be a zero-sum game that gives China a leg up, so it is interesting to analyze the possibilities.

7 June, 2008 Posted by | Book Review, China Future, China Technology | , , , , , , , , , , , , | Leave a comment

   

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