I read about this WTO ruling against China earlier this week and was meaning to blog about it.

The decision announced today by the World Trade Organization (WTO) is a huge victory for American workers.  In clear and unequivocal language, the WTO stated that China’s decision to limit the export of key raw materials violated the commitments China made when it joined the WTO.

People don’t realize how protective an economy China really is. They manipulate their currency and restrict imports. In this case China restricted exports of raw materials because it went against their national economic interests.

From drywall to milk we now arrive at peanuts and cooking oil.

This is why corporations like to go to countries with lax regulations—so they can produce products that are harmful to the human race and make a profit at the same time. The only problem with this is that pesky thing called public opinion and it does matter even in China and their domestic market.

Chinese authorities in a southern boomtown have detected a cancer-causing toxin in peanuts and cooking oil that was only recently discovered in milk, in the nation’s latest food safety scandal.

The food safety regulator in Shenzhen said it had found excessive levels of aflatoxin in peanuts sold in three stores, and in cooking oil in four restaurants, the official Xinhua news agency said late Friday.

So the careless regulation around the milk issue has now resulted in Chinese authorities playing a game of catch-up. Where else will aflatoxin turn up?

I’m sure this probably comes as a blow to Mr. Friedman’s – The World is Flat thinking, but workers in China are not happy.

In Shenzhen, 1,000 workers went on strike Nov. 22 at a factory owned by a Taiwanese computer-parts maker after the company required staff to work overtime from 6 p.m. to midnight, New York-based China Labor Watch said in a statement. A day earlier, workers at a Shenzhen factory owned by lingerie-maker Top Form International Ltd. struck over wages and “unachievable” production quotas, the group reported. Last week, 7,000 workers at a shoe factory struck in Dongguan, the Hong Kong-based China Labor Bulletin reported.

It looks like in the global race to the bottom many corporations are probably going to leave China. They’ll look to relocate to some new country where they can start all over again. They’ll keep this up until oil prices rise to a level where off shoring becomes uneconomical.

The weaker-than-expected numbers resulted in a trade surplus of $22.3bn £13.8bn in June.”Imports were below expectations,” said David Cohen of Action Economics in Singapore.”We are perhaps seeing some reflection of loss of momentum in Chinas growth,” he added.

via BBC News – Chinas imports slow down as domestic demand dips.

They are trying to balance things out there why aren’t we trying to do the same? Why do we import so much? Why not make things in the United States for our domestic market? Why aren’t we exporting more goods? Why do we import wind turbines form China?

Yep this is what happens when you offshore manufacturing. You get lax regulations.

About 74 people have been detained this year after reports that more than 100 people were affected by lead and cadmium poisoning.

Reports from China suggests hundreds of factories have been closed as a result of efforts to tackle poisoning.

It does seem that China is trying to clean things up a bit however.

Despite Government Efforts, Tainted Food Widespread in China – NYTimes.com

Consumers have also been repeatedly poisoned by excessive levels of the chemical nitrite in meat, Feng Ping, a professor at the Beijing Academy of Food Sciences, told an international food-safety conference last month. The most recent suspected case occurred April 21 when a 1-year-old Beijing girl died after eating fried chicken bought from an outdoor vendor, a local newspaper reported.

Get government off our backs! Let the free market work! Well, this is what happens. You get an unregulated market filled with tainted food.

Those Chinese hackers are rather sophisticated indeed. When blogger Noel Hidalgo went to China and was picked up & deported for filming a protest with his cell phone. He noticed that someone had also hacked his Facebook and Twitter accounts. Now Google is saying they’ve finally had enough? No more bending to the will of the Great Fire Wall of China?

Google said it had evidence to suggest that “a primary goal of the attackers was accessing the Gmail accounts” of Chinese human rights activists. The attack was discovered in December.

Based on its investigation to date, Google said it does not believe the cyber attack succeeded. “Only two Gmail accounts appear to have been accessed, and that activity was limited to account information (such as the date the account was created) and subject line, rather than the content of emails themselves,” the companysaid in a blog posting.

But David Drummond, Google senior vice president and chief legal officer, added that the attacks “have led us to conclude that we should review the feasibility of our business operations in China.”

For the moment it would appear that Google is saber rattling. But even if they are it will be interesting to see how China responds.

In the race to the bottom that we’re still in. Jobs are sent to China where there is no regulation, safety or decent wages. When this sort of trade policy is condoned, this is what the outcome will be.

More than 1,300 children have been poisoned by a manganese factory in central China, the state media reported today, amid growing fears about the prevalence of heavy metal pollution nationwide.

Besides the Chinese government the United States Chamber of Commerce and others are also responsible for promoting trade policies that send work to the unsafe and unregulated market that is China. Indeed even when China tried to protect its workers somewhat by giving labor unions more power and protecting workers’ rights, the Chamber of Evil was heavily against it.

Trouble in Toyland: U.S. recession jolts China – Economy in Turmoil- msnbc.com

Declining U.S. orders already have contributed to the closure of at least 3,600 toy factories since the beginning of 2008, according to the Chinese government, leaving hundreds of thousands of Chinese workers suddenly out of work in this sector alone. Some of the shutdowns have triggered violent protests, a situation that could worsen if the Western recession drags on through 2009, as many economists are predicting.

“Unemployment in China could deprive a lot of people of their lifeline,” says Hu Xindou, an economics professor at the Beijing Institute of Technology. “So it could trigger social instability or even shake the rule of the Communist party.”

As bad as many of these factory jobs probably were (low pay, unsafe and unhealthy working conditions, anti-labor union) it’s a bad situation because these workers have no where else to turn to. Obviously, I’m not a fan of the authoritarian Chinese government so this protest could be the start of something that will “shake their rule” but what would replace it? I’m getting ahead of myself I realize. It looks like the government is going to have to do some spending on social programs and find a sector to reintergrate these workers into. Maybe putting them to work in the “greening of China” would be one option.

You know you’re pretty messed up as a corporation when you’re more extreme than the authoritarian Chinese government in which you have your operations in. Ole Wolff Electronics decided to dismiss workers instead of recognizing the union they formed in response to the issues they have with this corporation. 

Loong-Yu explains that courts on two levels have since ordered Ole Wolff Electronics to reinstate the six sacked workers, but the factory continues to deny them access.

‘The dismissed workers are in a desperate situation. Some of them can’t get new jobs because the factory still has their work permits. The District People’s Court court found in favour of the workers in November 2007, but the company refuses to follow the court ruling and still won’t recognise the union,’ says Loong-Yu.

As a result, the acting chairperson of the union, Jiang Qianqiu, contacted 3F in Denmark for help. The Danish union contacted the company’s CEO with a request to comply with the court order and recognise the union.

You have the Chinese goverment ordering a corporation based in Denmark to reinstate workers! This matches the irony of the US Chamber of Commerce compalining when China tried to implement some labor protections for workers in China. The Chinese government should kick Ole Wolff out of the country if they refuse to comply.