COMMENT Nothing is scarier than the China scare
By Debasish Roy Chowdhury
BEIJING - A new food scare has gripped the United States, with the US Food and
Drug Administration (FDA) urging people to throw away more than 90 different
products, made at a Castleberry's Food Co plant, from chili sauce to
corned-beef hash to dog food, for fears that they are causing botulism, a
muscle-paralyzing disease.
Seven cases of botulism have so far been reported. Most victims consumed a
hotdog chili sauce made at the company's plant in
the US state of Georgia that has been temporarily closed. The recall has been
expanded to Canada as well.
Castleberry's is owned by Bumble Bee Foods, the largest branded seafood company
in North America - not in China, the evil land from where all the toxic food
and lethal products in the world supposedly emanate.
The list of product recalls in the United States in recent months is almost
inexhaustible. In March, Ford Motor Co recalled 2008 Super Duty trucks made in
a Kentucky plant after reports of tailpipe fires in the diesel version of the
vehicles; in June, California-based United Food Group recalled 34,000 kilograms
of ground-beef products after they were suspected to have been contaminated
with the bacterium Escherichia coli (E coli); and in July, Sara
Lee Corp began to recall dozens of its whole-wheat bread brands made at a
Mississippi bakery for fears that they contained pieces of metal.
But the product scares and recalls the US media seem fixated on are the ones
from China. It is the faulty tires, toothpaste, pet food, seafood and toys with
a China connection that are making all the news, with cover stories, editorials
and television programs harping on how China's "substandard" manufacturing
methods are putting American consumers at risk, how the factory to the world is
actually one big sham, and proffering ways to keep off products with any trace
of China.
As a bonus, the China horror story even has a feel-good subtext - nothing can
match US quality; if China makes goods cheaper than the US, now you know how:
by cutting corners.
This fear of Chinese products is reinforced by administrative measures. At the
height of the product scare, the US government quickly formed a cabinet-level
panel to recommend how to guarantee the safety of imported food and other
products. In this self-delusional world of policymaking, the Castleberry's and
the United Food Groups do not exist, it is only the products coming from
outside the United States that pose a threat.
Though it was denied that the move was aimed at China, the announcement came
the same day US senators heard testimony from quality regulators about problems
caused by the extremely rapid growth of imports from China.
That is really what this is all about - rising imports from China. It is not
the Chinese-product scare; what is actually being played out is the China scare
- the antiquated, mercantilist fear of imports that China's growing economic
might evokes.
Chinese exports to the US last year were nearly triple those of just five years
ago. Chinese exports to the United States totaled US$288 billion, while US
exports to China totaled $55 billion.
But according to the Cato Institute, Americans have never earned or spent a
higher share of their income in the global economy than they do today. In 2006,
what the US earned through exports and income from foreign investments abroad
reached a record 15.6% of gross domestic product. Since China's entry to the
World Trade Organization in 2001, US exports to this country have grown from
$19 billion to $55 billion, an annual average growth of 24%.
Despite the din about how China is getting ahead with its undervalued yuan,
real output of US factories has increased by 50% since China pegged its
currency to the US dollar in 1994.
Despite the rhetoric of how ("substandard") Chinese products are stealing jobs
from Americans rendered powerless by this unforeseen consequence of
globalization, trade with China accounts for a mere 1% of annual job
displacement in the US.
By Cato's estimates, at the most 150,000 jobs are lost in the US every year
because of imports from China, compared with 15 million jobs that disappear
annually in the US economy primarily as a result of technological changes and
the consequent increase in productivity.
Productivity gains have actually taken a bigger toll on employment in China
than in the US. A study by Alliance Capital Management LP in New York finds
that while the number of manufacturing workers in the US dropped by 11% from
1995 through 2002, in China it dropped by 15%.
And in any case, Chinese imports in the US are mostly replacing imports from
other Asian countries, not US products themselves. And manufacturing is no
longer the foundation of the US economy as it begins to de-industrialize as
part of a global economic shift.
But then again, while there is no market for reason, there is a big one for
fear. That is why a Utah-based health-food company has launched a new label and
ad blitz promoting its products as "China-free". This is despite the fact that
FDA records show China is not even the leading source of contaminated imports
to the US. India and Mexico have surpassed China in "refused food shipments"
over the past year, while the leader in rejected candy imports happens to be
Denmark.
Why pick on China?
It is difficult to ignore the xenophobic, and even racist, overtones in the
attacks against China. When the products are made in the US, it is just the
company that is in focus. When they are found to have a China connection, even
if it is a US company getting its products made in China, it is the country
that takes the lashes, as if the company has no obligation toward quality
control.
Protectionism needs a popular idiom. Xenophobia needs a whipping boy. China
scare is the product of this marriage of convenience. As the poster boy of
economic success and the visions it inspires of trumping the almighty US
economy, China is the obvious target when it comes to manufactures. Much of the
same is directed at India when it comes to services, with outsourcing fears
often vented by Western callers in torrents of racist abuses on Indian
call-center workers.
This xenophobia is what lies at the heart of the current product panic in the
US. If unchecked, and recklessly fanned, this has the potential of derailing
the very process of globalization that developing countries are betting on for
a better future. That is scarier than the China scare.
Debasish Roy Chowdhury is a senior editor with China Daily.
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