From China, with Love

From Fareed Zakaria on CNN.com, “If you look at job creation over the last 20-25 years in America, you’ll notice that we haven't been able to create any jobs in what is called the “tradable sector” of the economy - those jobs that are subject to global competition. The only jobs we’ve really created have been in industries like health care, government, and construction, which are basically local industries shielded from global competition. You can't outsource the building of a New York skyscraper to a Chinese worker.”

Dear Mr. Zakaria, wrong! Read what Time Magazine had to say: “American hotels will soon be added to the growing list of things that come with a “made in China” stamp.” Don’t believe it’s possible? Read on.

 “Builders in China completed a 170,000 square foot, 30-story prefabricated hotel in just 15 days, ending on New Year’s Eve – Construction workers bolted together the new hotel, in Dongting Lake in Hunan province, from pre-made modules put together in a factory and then placed them on steel structures at the construction site, according to the International Business Times. It can reportedly withstand an 9.0-magnitude earthquake. It completely changes the way buildings are constructed and, I believe, is about to change the entire industry,” architect Lloyd Alter wrote.

The Chinese company behind the speedy process, Broad Sustainable Building Corporation, has some former success with building quickly. Once the world’s largest producer of air conditioning equipment, it previously built the 15-story Ark Hotel in Changsha, China, in just six days.

The implications of the latest project seemingly go beyond simply adding to the Dongting skyline in a speedy fashion. “Construction is just about the only industry that has not been exported,” Alter explained. “But now the Broad Sustainable Building Corporation has designed a system that will let them build anywhere, to construction tolerances of +/- 0.2 mm.”

Now to those of you who still believe that any form of cooperation is socialism, look out! Because while we compete with each other, China is cooperating to grow their economic future. While we creatively destroy each other, they coordinate their actions and erect pre-fab skyscrapers in 6 to 15 days. While we argue about whose social values are better, they’re constructing modern cities from primitive villages.

Oh I know. The Chinese people don’t have the freedoms we have. Let’s see, since 9/11 and the Patriot Act, our government can spy on us without a warrant. Well then, the Chinese can’t have the protections that come from the rule of law that we have. Wait a minute.  Except since this president signed the new National Defense law into effect that allows our government to incarcerate us without legal representation or recourse – based on any suspicion of terrorism. Well at least we have that last part: any suspicion of terrorism. Just what constitutes such suspicion? The Department of Justice considers you worth investigating if you are missing a few fingers, if you have weatherproof ammunition, if you own guns or if you have hoarded more than seven days of food in your house.

Now I don’t mean to say that we should look to China for guidance on how to run a country. But I think we have a lot to learn about how to cooperate to create much better economic outcomes. But alas, why should I think that we might be capable of learning from someone else?

In the fifties, W. Edwards Deming went to the American auto industry and tried to teach them a new method of management using statistical methods. Of course, they rebuked him. Deming went to Japan and changed their entire manufacturing economy. For many years their highest productivity award was called “The Deming Award”.

Remember the end of that story. We lost most of our auto industry to Japan. What was his secret? Cooperation between labor and management to manage the system of production. Wow! A complex thought in the Western world.

Robert DeFilippis