Competition From The Chinese Black Markets
The general fear that America is losing its competitiveness is simply unfounded. As is the fear that Japan and Europe are losing their competitiveness. I might write more on this in the future as it pertains to specific topics but I thought this was very timely. Reports are that up to 25% of all GDP in China are ripoffs.
Everything from premium golf equipment to gaming consoles to motorcycles to cars to hand bags to medicine to movies to music to books to software and on and on and on are copied illegally. I remember twenty years ago that text books we were using in college was being mass produced illegally in China. It is as much a part of their culture as baseball is to America. Why? China is not an innovative society.
In order for China to truly become a capitalist society or provide a real economic threat to established capitalist societies, they need stronger intellectual property laws. In order to protect investors, companies and individuals which develop new products, ideas or any new innovation, laws need to protect the research and investment required to do so. The current situation in China is ridiculous. There is nearly zero respect for the rule of law as it pertains to intellectual property. Chinese companies have gone so far as literally copying Daimler Chrysler's Smart car, Chevrolets, Honda motorcycles and most recently copying the Lexus automobile badge, reversing it and slapping it on a Chinese made automobile. How incredible is it to imagine that you work for General Motors and are selling a model of Chevrolet in China and walk down the street to see the nearly exact car in a Chinese company showroom? If these companies did not sell their products in China and exert pressure on the authorities to stop such shenanigans, they would continue unchecked as has happened with other companies over the last quarter century. Recently German authorities seized over 1 million pairs of counterfeit Nikes.
Now, this story does not pin blame as to where the shipment originated, but I would be surprised if it wasn't China since they have a very robust infrastructure for ripping off Nike products. Typically, as I understand it, these shipments are pushed into Europe and "laundered" for re shipment to the U.S. as legitimate goods. How many tens to hundreds of billions in revenue are lost by companies to these efforts? No one really knows but there is a reasonable chance your Calloway driver is made in China if you bought it on eBay. Ditto with Viagra bought on the internet. To allow China to join the WTO with such lax enforcement of intellectual property rights is an oxymoron of major proportions. Emphasis on oxy"moron".
Imagine what a society could be capable of if the energy used to ripoff was used to innovate. Why won't the Chinese government crack down on such practices? I suspect for a multitude of reasons. Not the least of which is most government officials have benefited from such practices. In addition, what would you do if up to 25% of your economic output was attributed to such behavior? Encourage it?
Everything from premium golf equipment to gaming consoles to motorcycles to cars to hand bags to medicine to movies to music to books to software and on and on and on are copied illegally. I remember twenty years ago that text books we were using in college was being mass produced illegally in China. It is as much a part of their culture as baseball is to America. Why? China is not an innovative society.
In order for China to truly become a capitalist society or provide a real economic threat to established capitalist societies, they need stronger intellectual property laws. In order to protect investors, companies and individuals which develop new products, ideas or any new innovation, laws need to protect the research and investment required to do so. The current situation in China is ridiculous. There is nearly zero respect for the rule of law as it pertains to intellectual property. Chinese companies have gone so far as literally copying Daimler Chrysler's Smart car, Chevrolets, Honda motorcycles and most recently copying the Lexus automobile badge, reversing it and slapping it on a Chinese made automobile. How incredible is it to imagine that you work for General Motors and are selling a model of Chevrolet in China and walk down the street to see the nearly exact car in a Chinese company showroom? If these companies did not sell their products in China and exert pressure on the authorities to stop such shenanigans, they would continue unchecked as has happened with other companies over the last quarter century. Recently German authorities seized over 1 million pairs of counterfeit Nikes.
Now, this story does not pin blame as to where the shipment originated, but I would be surprised if it wasn't China since they have a very robust infrastructure for ripping off Nike products. Typically, as I understand it, these shipments are pushed into Europe and "laundered" for re shipment to the U.S. as legitimate goods. How many tens to hundreds of billions in revenue are lost by companies to these efforts? No one really knows but there is a reasonable chance your Calloway driver is made in China if you bought it on eBay. Ditto with Viagra bought on the internet. To allow China to join the WTO with such lax enforcement of intellectual property rights is an oxymoron of major proportions. Emphasis on oxy"moron".
Imagine what a society could be capable of if the energy used to ripoff was used to innovate. Why won't the Chinese government crack down on such practices? I suspect for a multitude of reasons. Not the least of which is most government officials have benefited from such practices. In addition, what would you do if up to 25% of your economic output was attributed to such behavior? Encourage it?
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