Chinese Wages and American Politics

We seem to have political structures around the world that are interested in wages.  Both U.S.political parties are talking about wage increases of some type, and the Democrats are suggesting $15 an hour.  There was an article on China's wage dilemma in today's  Wall Street Journal that said one of the big players in Chinese markets was debating whether to raise wages or keep them somewhat the same.  The Central Goverment was telling him to keep them stable.  He was paying his employees an average of $284 a month.  At $15 an hour, it would only take a US worker three days to make the monthly wage of a worker in China.

In case you were wondering where our trade deficit comes from, this is it.  US businesses would rather manufacture in China than pay the labor rates that are being proposed for the US.  Nobody can convince a rational person that higher wages will help anyone who won't be able to find a job as more of them move out of the US.  I should also mention that Chinese labor rates have gone up over the last few years, so their workers are better off than they were.  But, this article is inferring that China is trying to balance wage increases with market realities - in other words, keep them down without causing worker demonstrations of which there are more than a few.

Both these political systems are playing games with their populations by pretending that things will get better with new leadership.  Both the US and China are getting new leaders but nothing will change for them given the disparity between what these two countries pay for labor.  It is no consolation that Thailand and Vietnam have managed to stay as low, or lower, than China.  None of those tennis shoes will be made in the US.

This is a trade war fostered by our own business leaders.  They allow dependence upon China as a labor pool, even though they know that supporting China is dangerous in the long run.  They steal our technology, undermine our politicians, expand their military and lay claim to vast expanses of territory.  They don't even treat US businesses operating in China with respect.  How long can the Boards of these companies continue to allow profits to overcome the realities of doing business with China?