I did a post recently on a report by the San Francisco branch of the Federal Reserve designed to convince us that the fact that we imported $365 billion dollars worth of stuff from China last year is no big deal. Well, there is a new voice joining that chorus; Professor Baizhu Chen, a professor of clinical finance and business economics at USC Marshall School of Business recently authored an article at Forbes. com with the provocative title ” Buying From China Is in Fact Buying American.” Just take a minute to get your head around that concept. Sounds a lot like my old favorite, “We had to destroy the village in order to save it.”
The article starts off with the Professor Chen challenge; Professor Chen challenged his neighbor Johnny, who owns several small restaurants in an affluent neighborhood in Los Angeles, to see if Johnny’s family and restaurants could survive this Christmas without using any Chinese-made products. According to Professor Chen it was a short-lived challenge since in less than two days, Johnny had to admit that if he “wants to spend this Christmas without anything made in China, he literally has to tear down his house and close all his restaurants.” It’s a great tag line, but of course it isn’t remotely accurate.
Johnny’s American product research skills must be rather stunted. As I have demonstrated over the last months, it is fairly easy to find American made goods. If Johnny had wanted American made knives he could have bought them from Lamson & Goodnow, Dexter, Cutco, and Rada. If Johnny needed American made sauté or baking pans he could bought them from Manpan, All-Clad, Nordicware, USA PAN, or Pyrex. If Johnny was a bit low on plates and glasses, he could have picked up American ones from the Homer Laughlin China Company, Hartstone Pottery Company and Anchor Hocking. Finally, if Johnny needed American made furniture, all he had to do was surf on over to www.roomandboard.com and he would have found any type of furniture he needed. I guess Johnny also missed the ABC News’ segment where they filled a home with nothing but Made in America products. I guess Professor Chen missed those episodes as well.
Next up for Professor Mr. Chen is the now well-worn San Francisco Federal Reserve Board study from earlier this year. Rather than deal with it in detail here, just read my blog post on it. In a nutshell, if Apple assembled its components in this country rather than having FoxConn workers assemble them in China, we would continue to have the “thousands of high paying jobs” Apple currently provides to its engineers in this country as well as thousands of moderately well-paying iPad assembly jobs for Americans who are currently unemployed. I will take the latter scenario, how about you?
Professor Chen’s next argument is that China doesn’t steal American jobs, rather it creates jobs in America because of all the Americans working for American companies that produce their products in China. Yes, Apple Stores in the U.S. employ thousands of young associates in America, helping customers select Chinese assembled iPhones. But those same young American associates would still be doing that if the iPhones they were selling were assembled in America rather than in China. Yes, hundreds high-paid professionals in New York City market Gap jeans made in China. And those same people would still be doing that if Gap jeans were manufactured in the U.S. Yes, Minnesota-based Target, with more than 1,200 stores nationwide selling lots of China-made merchandises, employs over 350,000 American workers. And they would still be doing that if they were selling American made, as opposed for Chinese made shoes, socks, shirts, plates and glasses. And yes, thousands of UPS and FedEx workers cheerfully move boxes of Chinese made Dell computers, Hasbro toys, and Nike shoes to American families. And they would still be doing that if those goods were manufactured in this country, only they would be moving the boxes from Wisconsin, Oregon, or Nevada to Florida, Tennessee or Nebraska, rather than from China to the U.S.
But I am afraid Professor Chen saves the worst for last. According to Professor Chen, “Buying China, in fact, is buying American.” Well that might be true in Professor Chen’s world, but guess what, it isn’t true in the real world. I wonder how many American workers Professor Chen has interviewed in the last ten years whose jobs have been outsourced to China by American firms. I rather doubt these displaced American workers share Professor Chen’s opinion. And I am not so sure they would share their opinions on his “Buying China, in fact, is buying American” theory in quite the polite manner they do so at the faculty lounge of the USC Marshall School of Business. That’s because to displaced American workers, this issue isn’t theoretical. If pressed, these displaced American workers would agree that some Americans are employed selling stuff made in China. But they know that a lot more Americans would be employed if the products we buy at Target, Eddie Bauer and the Northface were made in this country. Professor Chen planned to buy his little niece a toy panda bear made in China for Christmas. What Professor should have done was check out my top ten Made in America Christmas gifts for 2011 list at simply-american.net. Because if “buying China, in fact, is buying American, who knows, maybe buying American, in fact, is buying Chinese?