Whose Dividend Is Globalization?

This Youtube video China's role in globalization, particularly focusing on the perceived negative consequences of prioritizing low-price competition driven by factors like low wages, reduced benefits, and mandated overtime. It contrasts this approach with an ideal scenario where China leverages its manufacturing strength for higher value-added production and improved worker welfare, questioning why the focus shifted to simply lowering prices globally. The author uses examples like the solar panel industry and the recent surge in low-cost Argentinian beef imports to illustrate the downsides of prioritizing market share through price wars, arguing that such strategies hurt domestic industries and may not constitute true "dumping" in the international sense. The text concludes by suggesting that the ultimate goal of globalization should be to benefit the populace, not just businesses, and highlights how China's tax structure and a focus on corporate success over individual well-being may contribute to these issues.

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The true purpose and beneficiary of globalization can be addressed from several angles presented by the speaker:

• Historically, when China joined the WTO over 20 years ago, the objective of participating in globalization was to escape the fate of being just a cheap labor provider and to eventually produce high-value-added goods. The ultimate vision was to allow the Chinese people to live better lives. At that time, enterprises were considered merely the means to achieve this broader societal goal. There was a general acceptance of enterprises succeeding or failing based on their ability to benefit the people, which was seen as eliminating backward production capacity.
• The speaker suggests that the ideal outcome of industrial upgrading within the context of globalization should be for China to set higher prices, like Western powers historically did with their dominant positions, and earn excess profits with high added value. These profits should then lead to better wages and social welfare for domestic laborers.
• However, the speaker observes a deviation from this ideal, where the concept seems to have been wrongly redefined. The mission of "Made in China" appears to have become primarily about driving down prices globally. The current form of industrial upgrading often relies on low prices achieved through intensive labor, reduced welfare, and extra hours, which the speaker argues is fundamentally no different from the situation in the 1990s. This approach, achieved at the cost of young people's freedom and declining birth rates, seems to primarily create a cheap consumption environment for consumers in other countries.
• The speaker highlights a shift over time where Chinese enterprises have gained greater legitimacy, policy preference, and significant advantage over employees and consumers internally. In international trade, there's increased sensitivity and difficulty in accepting cheaper, higher-quality foreign products, with a near-fanatical pursuit of domestic production, sometimes equating buying domestic goods with moral virtue. The concept of global market competition has become blurred, taking on a flavor of winning or losing for national dignity.
• According to the speaker, this shift is partly due to China's unique tax model, which heavily relies on indirect taxes (like VAT) levied on enterprises and passed to consumers, rather than direct taxes on individuals and profits. This structure inherently causes policy to prioritize enterprises over individuals. Furthermore, the success of enterprises is highly visible and often equated with national honor, causing people to overlook the true purpose of enterprises, which is to improve people's lives through increased productivity and technology. The focus has become "catching the mouse" (enterprise success) without considering the reason for catching the mouse (improving lives) or how the benefits should be distributed.
• The speaker argues that China should not only embrace globalization when it is winning. Using the example of imported beef, the issue can be framed not just as whether foreigners should make money from Chinese consumers, but whether ordinary Chinese people have the right to enjoy the benefits of globalization by accessing cheaper, higher-quality protein. The speaker believes most people simply want to eat affordable good meat.
• The speaker explicitly states that the true essence of the economy is "經國濟民" (managing the nation and benefiting the people). The essence of globalization, in the speaker's view, is about fully free trade where each party obtains what they need, developing advantageous industries and technological leaps based on advantages that do not rely on labor exploitation.
• Ultimately, the speaker believes that excess profits gained through competitive barriers should be distributed to all Chinese laborers in the form of more pay and more vacation. When this is genuinely achieved, the speaker believes people will naturally enjoy a good life, be optimistic about new life, and will not need slogans to encourage consumption or childbirth.

In summary, the source suggests that the initial purpose of engaging in globalization for China was to improve the lives of its people through industrial upgrading and higher-value production. The ideal continuation of this process would involve gaining market dominance and high profits to benefit domestic workers with better conditions. However, the speaker perceives a current deviation where the focus has shifted to enterprise success often achieved through intense labor and cost-cutting, sometimes appearing to benefit foreign consumers more than domestic laborers. The true purpose, as argued by the speaker, is "benefiting the people" ("經國濟民") through equitable distribution of the gains from globalization, achieved through non-exploitative competitive advantages. The true beneficiaries should ultimately be the people, enjoying a better standard of living and greater well-being.