The following article has been posted on many Chinese websites under different titles. The extensive posting on China’s heavily censored websites and blogs indicates a widespread public acceptance of the article; it also indicates that the ruling regime feels a real sense of political crisis. In this scholarly article, both nationalism and the anti-western sentiment found in traditional propaganda have been blended together. China is portrayed as a grief-stricken victim, not of its own regime, or of the breakdown of morality in China, but of lustful western exploitation that has expended all its natural and human resources to contribute to the welfare of the West and of the rest of the world. The West is cited as a scapegoat for all the current problems that China faces: the prevalence of tainted food, slave-labor wages, the prevalence of crime and prostitution, the outrageous environmental degradations, wanton corruption, the lack of occupational safety, the heavy losses in the financial sector, and even why China’s wealthy transfer their assets abroad. Below is an unabridged translation of the Chinese original. Chinascope has not been able to verify the authorship. [1]
Author: Professor Zhang Hongliang of Central University of Nationalities
A volunteer named Zeng Feiyang did an investigation within the Pearl River Delta, which is known as China’s export base, and found that every year 30,000 accidents occur in which punch worker’s fingers are severed. This totals more than 40,000 fingers. These figures are only for accidents happening to punch workers; it is just a small percentage of the accidents that happen to all machinery workers. As for the actual number of total machinery accidents, it is probably a number that no one will ever figure out. However, an investigation was conducted of the 8-million laborers in Shenzhen City. The results showed that one out of every five laborers has had either a work accident or an occupational disease. Therefore some factories in Shenzhen completely change their workers every two years. In order to deal with the disabled workers going to court, so that the state can “maintain the stability of society” and “avoid affecting economic profits,” the local government purposely prolongs the processing time of the cases in which the workers sue the employers so that they last three years or more. Consequently, these disabled workers usually end up giving up because they do not have enough money to stay for three years. They go back to the rural area and there goes the second half of their lives. Take a look at the rushing water of the Pearl River; it is full of laborers’ blood and tears!
As we talk about the laborers’ misery, one will at once remember the mine accidents in China. The entire world has found them shocking. From 2001 to 2005 in China, the mine accidents where 10 or more people were killed occurred on the average of once every week. The price of the 80 million tons of coal is the yearly death of more than 6000 mineworkers, which is an average of 17 workers per day. These numbers come from government statistics; the actual numbers should be much higher. Even according to these government statistics, China’s death rate for every million tons of coal is 100 times more than that of the US, and 10 times more than that of India or Russia. China’s death rate is ranked number 1 in the world and the total number of deaths is higher than the sum of the rest of the world combined. The mountainous bone ash of mine workers has stacked up a countless amount of treasure for the international monopolies and the Chinese mine owners. In this year’s Beijing International Automobile Exhibit, a mine owner with a running nose wanted to buy a Ferrari that costs several millions of yuan. When the lady told him that the car was very expensive, the mine owner sniffed out the snot and said, “Just let me know how much. I’ll buy the car as well as you.” In the end, several mine owners bought a total of more than 80 Ferraris. This extremely distorted scene of capitalists in a Communist country cannot be seen anywhere else in the world, even in a colony.
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3. From the aspect of foreign exchange, the enormous amount of treasure obtained by the laborers’ blood and tears as well as the mine workers’ mountainous bone ash are all completely offered and transferred to the US. However, facing the unprecedented resource disaster and the catastrophes suffering by the common people, China’s mainstream economists are cheering and saying that we have obtained a great amount of valuable foreign exchange. We indeed have 1,000 billion dollars in foreign exchange. However, rather than saying that these are China’s valuable treasure, it is better to say that these are the US’s valuable treasure. First of all, more than 2/3 of these 1,000 billion dollars are US money. What is US money? Basically it is some paper printed by the US printing firms. The US can print whatever amount they like. As there is more and more US money printed, the value of US currency drops, and China’s foreign exchange is greatly reduced in value. Calculating the US dollar’s value in Euro dollars, the US currency’s value has dropped by 50% in the past few years. Just like that, more than 700 billion dollars of China’s foreign exchange has evaporated by half. This half equals the total income of the entirety of China’s population. This year another 6% of the foreign exchange will evaporate. This is 60 billion dollars and exceeds the total amount of medical care for the aged people in China. Secondly, most of the foreign exchange that China bought is the national debt of the US. In the past there is a line used in China for mobilizing people to take action, “Buy the national debt to support the nation’s construction.” Today, we are buying the US’s debt to help the financial success of the US, and using extra foreign exchange to help stabilize US market prices, to lower the everyday living cost of the US people, and to support the national construction of the US.
Not only is this so, including the US, many developed Western countries say that China has a large amount of favorable balance of trade, thus pressuring China’s currency from gaining value. They also work with the companies within China and threaten China with the greatly reduced value of foreign exchange, so that the Chinese government imports western products with a very high price. It is shocking how high the prices of the imported products are and how low the prices of the exported products are. The luxury cars that China imports cost more than three times the prices on the oversea markets. Rolls-Royce Phantom Coupe costs about $400,000 overseas, but in China it sold for several million. Not long ago, a real estate businessman just bought one for over two million dollars. Prices of middle class cars in China are also around two times the price on the oversea markets. The imported makeup products and other luxury products are even more unbelievable. It is like publicly robbing away money from China.
In the China Southern Luxury Exhibit, an emerald was sold for over 11 million dollars. In the following luxury exhibit in Shanghai, within four days, more than 70 million dollars were exchanged in all the successful deals. Many luxury companies in the world rushed into China; so far there are more than 300 of them. Even things that are cheap overseas are selling in China as luxury products. For example, le vin rouge from France costs over 1,000 yuan (140 USD) in China, but in France some beggars often drink it even in the subway. The intellectual products have even higher prices. Microsoft Windows 98 costs $50 in the US, which is about 400 yuan. It is less than two hours salary of an American blue collar worker. In China, it is sold for 6,999 yuan, which equals a Beijing worker’s wages for 14 months, or a Shenzhen laborer’s wages for 20 months. Later, the XP system came out and it costs as much as 65,000 yuan. The pirate market has actually kept all these prices low. Otherwise, these monopoly prices would force 95% of China’s computer users to quit and China’s information technology level would retrogress by 20 years.
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Western developed countries have hired China’s business groups and mainstream economic experts and have already successfully established a system where China imports products with high prices and exports product with low prices. Through this system, they are converting China’s resources and the health of China’s citizens into the cheap products in their countries. As the consumption level gets higher and higher, these developed countries, including Japan, have not worsened their environment at all; instead these countries’ environments are getting cleaner and cleaner. By using China’s business groups, these countries have successfully separated profits and cost. Without costing themselves any bad outcomes, they still get good economic growth, and let China bear the bad consequences for them. This system can also be seen now with the conflict of China’s currency (Renminbi). Unlike US dollars, which are losing value both internally and externally, China’s currency is rising in value in relation to US dollars, but its buying power is reducing inside China. What this rising and dropping are doing is basically moving all the money of the common Chinese people into the pockets of the overseas employers.
4. Looking at the foreign capital, on one hand, China is using an enormous amount of money to support the US’s economic development; on the other hand, it is sacrificing our own resources and even our sovereignty, in order to attract foreign capital. Foreign capital is becoming the economic basis for the developed western countries to control China’s economics. Under the globalization today, the fact that foreign capital is flowing into China itself is a normal phenomena. However, the way we are drawing the foreign capital is becoming a historic catastrophe for the nation and the people.
First, the foreign capital economics is becoming a major way in sucking out China’s wealth. The foreign capital in China occupies more than 40% of our GDP, and the foreign firms take up 55.48% of the total imports and exports. This by far exceeds the normal ratio of the foreign capital for an export-oriented economy country. By the end of 2005, the total foreign capital that our country used was 662.405 billion dollars. According the estimate by the World Bank, the yearly profit margin rate of the foreign firms in developing countries is as high as 16% – 18%. From this, we can estimate that just in 2005, foreign firms gained more than 100 billion dollars of profit from China. The World Bank’s estimate is for the average developing countries. However, it is obvious that this number is far off from the actual number in China. This is because the foreign firms in China enjoy tax free, cheap land, super cheap labor, and all kinds of corrupt benefits. These do not exist in other developing countries.
How high is the actual profit margin rate? This is a highly confidential number to both the government and foreign firms. Therefore we can only try to estimate from various sources. The monopolies inside China (owned by the Chinese people) have a profit margin rate from 100% to 2000%. Usually, the profit margin rate of the foreign firms cannot be lower than these monopolies. This had been confirmed in many cases when foreign firms disclosed this information. For instance, Morgan Stanley had an internal conflict and some confidential information was disclosed as a result – their profit margin rate in China was 900%. If we calculate using the lowest rate of the monopolies, which is 100%, the total profit gained by the foreign firms in China each year should be around 700 billion dollars, which equals the sum of two years of all people’s salary in China.
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Also, nowadays when the foreign firms enter China, their main goal is no longer investing money into new projects. It is actually to collude with officials to purchase an enormous amount of state-owned assets at very low prices. This is a planned nation-wide murder. The first step is a tax-free system in which the foreign firms do not pay income tax for the first two years and pay half the income tax in the next three years. In the whole world, such a case only happens in China, where foreign firms enjoy something that the nation’s own citizens do not enjoy. This tax-free system has given the foreign firms the power to easily crush down any state-owned firms. The state-owned firms not only have to pay 33% (before it was 38%) of heavy taxation, but also have to cover the employee’s benefits. Consequently, when competing with the foreign firms, who do not pay tax or provide benefits to the employees, the result is already obvious. The second step is pressuring the desperate state-owned firms to “cut employees and increase efficiency.” Consequently, 60 million employees have been laid off from these state-owned firms. This is just like before trying to possess a woman, forcing her to throw away her kid. The result is that we have peeled off the barriers and separated out the clean capital. We are just waiting for foreign firms to come and swallow it.
Endnotes:
[1] Boxun, June 9, 2008
http://news.boxun.com/news/gb/china/2008/06/200806092153.shtml