Is the Chinese Government Moving Against Japanese and Taiwanese Corporations?

Jun. 14, 2010 6:37 AM ETHMC, EWT, FXI, PGJ, EWJ13 Comments
Howard Richman profile picture
Howard Richman

Over the last month, strikes have broken out against many factories of Japanese and Taiwanese corporations in China, leading to huge wage increases. There have been many theories laid out as to why the strikes are occurring. For example, when Associated Press reported the story, they reported the following possible explanations:

Analysts said the recent labor actions were related specifically to job conditions and wages rather than any wider issues such as friction with Japan, which has at times prompted public outbursts against the Japanese in China....

Younger Chinese now seeking work in factories were raised in an era of relative plenty and have less tolerance for highly regimented factory living than older generations familiar with hunger, political unrest and poverty.

These theories do not explain why only Japanese and Taiwanese factories have been involved. Other articles have proposed that Japanese and Taiwanese factories pay lower wages than western factories or that Japanese and Taiwanese factories tend to employ workers from the same home towns, making worker unity more likely.

All of these explanations are indeed possible, but I have a different one. I suspect that the Chinese government is specifically targeting Japanese and Taiwanese factories in order to make them less competitive than Chinese-owned factories within the Chinese market as part of a foreign policy which is targeting these countries.

My theory is supported by the clear involvement of the Chinese Communist Party in permitting the strikes and controlling their message. The following comes from a report about Chinese unions put together by The Economist:

On May 31st more than a hundred high-level union members were sent to the [Honda] factory by the local government. Some scuffled with workers who were trying to get to the gate to talk to reporters. “They’re mafia,” fumed one employee, as another showed a long cut on his

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Howard Richman profile picture
Dr. Howard Richman ( is one of three generations of a family of economists. Howard co-authors the blog Trade and Taxes ( and co-authored the 2008 book, Trading Away Our Future, published by Ideal Taxes Association ( He is a frequent contributor to Enter Stage Right, World Net Daily, and American Thinker.

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