Late, I Ran out of postings

David, What China has done is merely addressed the issue of “Market”

Looking at Australian car production, as an example, many components are built by specialist suppliers and reflect the same manufacturing / marketing relationship which you accredit to China.

My original post identified the problem Australia faced with small domestic market size.

Part of the mindset was driven by historic influences. In the 1950s, with every other nation on earth exercising protectionist policies including heavy import tariffs, thinking beyond the domestic market was hampered to the point of ignoring the potential.

For many of its manufactured goods, China has no domestic market.

China was not “limited” in its thinking to in domestic market terms. China perceived its opportunity as a world wide supplier and did that on the back of cheap labour.

Now we come back to the standards of operation. Chinese employment practices, OH&S etc. compared to Australian standards result, in a cheaper labour hour cost than Australia.

I say that as a fact, not good or bad, simply a fact.

Because of lower employment standards, the Chinese can produce labour intensive articles at a significantly cheaper price than Australia. However, having spent many years working in Australian manufacturing environments, I know the dexterity and innovation Australians can deploy enables Australia to produce a range of capital intensive products economically and competitively.

Supporting Pericles post.
Ultimately, we come back to government. The Chinese government have withdrawn from overall economic control, surrendering sections to private entrepreneurs. This is significant. Whilst government control may remain extensive, relative to Australia, you have to ask why surrender any of that central control?

Because the Chinese authorities realised it did not work. Similarly, and ultimately, government “playing” with industry does not work (be it Australian, UK, USA or Chinese industry). Government interventionist policies only produce the levy banks of my previous illustrations.

Governments playing with peoples lives does not work either, individuals know what is best for themselves and by nature, should not want governments to “regulate” their lives. Instead they take risks and are rewarded

Unfortunately the world of manufacturing is changing. If only one could go back to England in the fifties. Now that was maufacturing at its finest.

“Unfortunately the world of manufacturing is changing. If only one could go back to England in the fifties. Now that was maufacturing at its finest.”

That is the same argument the croppers claimed for their efforts regarding carpet finishes (http://www.ehs.org.uk/society/pdfs/Kirby%2025a.pdf) and close to the excuses luddites relied on for smashing textile equipment.

It is the same argument which the inefficient demand that governments indulge in to protect “vested interests”.

Reality is if English Manufacturing was so tip-top and fabulous, it would have prevailed over the efforts of the rest of the world.

Manufacturing itself is one aspect of the product process. Product research, business finance, marketing, distribution, selling all play roles in the commercial cycle. Manufacture as much as you want but if you have no market to sell it in or no marketing skills with which to promote it or sales skills with which to sell it or if you just cannot or will not compete with competitors, why bother?

Case in point, Rolls Royce. Major UK public engineering (figure head) company. Went bankrupt in 1971 largely due to poor financial controls and a corporate board made up of engineers who threw all the resources into research for carbon fibre applications in jet engine blades etc. It was spared the ignominy of being broken up by being nationalised. They had to sell the cars off but to no avail (even BMW do not want them nowadays).
http://en.wikipedia.org/wiki/Rolls-Royce.

Conversely, Pilkingtons jealously private UK company Have been consistently independent and private up until the mid 1970’s . Went partially public to fund new float glass product development and have been consistently successful. Not all UK manufacturers are “basket cases”, just the ones which were “saved” and nationalised and turned into sheltered workshops for incompetents.

As for “manufacturing at its finest” some would say the pottery work of Josiah wedgewood has never been matched since he invented his processes.

“Manufacturing” embraces such a broad range of activity, which effects a massive range of articles we all use. To suggest any particular time represents the zenith of “manufacturing achievement” is naïve.

I've never been to England nor do I know a thing about their manufacturing in the fifties.

Pip Pip tally ho.

Col, I am in total agreement with most of your conclusions and arguments, but I fear you may have gone a little overboard with the statement "The Chinese government have withdrawn from overall economic control"

The Chinese government is - still - a massive state bureaucracy, that intervenes in the market in many different ways. Not least of these, of course, is their careful, and extremely clever, management of the exchange rate.

Nor will you find the equivalent of anti-trust laws, that in Western economies attempt to maintain a level of market freedom by preventing the accumulation of market monopolies. As Peter Morici of the Baltimore Sun pointed out in an interesting recent article (unfortunately timed-out from their web site, though Google has archived it), "If Archer Daniels Midland and Cargill [US commodity processing giants] conspired to manipulate commodities prices, Western enforcers would impose steep fines and perhaps jail time. In China, though, the cops and robbers are one and the same."

He also uses a phrase "autocratic capitalism", which quite nicely conveys the iron hand that remains their weapon to ensure that the state does not lose control of the economy as it grows through the efforts of its entrepreneurs.

One additional point, which I might cross-pollinate to another forum.

In November last year the UK's Guardian, not widely known for its conservative bent, remarked upon "[China's] extraordinary economic growth, titanic industrial expansion and pell-mell sprint towards capitalism which have lifted 400 million Chinese out of poverty in a generation"

Pericles..

I would agree with your sentiment re appearances and practice of Chinese bureaucracies.
My point with control was, the idea of the Chinese communist model giving up even the smallest amount of control was astounding but it has happened.

Your comment re anti-trust is absolutely correct. Note, anti-trust really matters when servicing domestic markets and much of the new production is not for domestic consumption.

To be honest, I would find one of the biggest competitive advantages for investment of new industries in Australia remains our history. That history is one which says, invest in Australia and the investment is safe from nationalisation or state seizure. I would not trust many places in Africa, China, the Middle East or the old Eastern European states to be free of that risk.

Some here sneer at our British heritage. They forget that heritage includes language. I think, in terms of competitive advantages, better to be speaking English than koori or some other minority ethnic tongue (like French or German).

Attitude also matters. Practises which I think were prevalent in Malaysia, of legally requiring a senior director to be of a particular ethnicity seriuosly detract from “competitive performance” (the dangers of “affirmative action”) and developing effective management structures.

I believe inspiration and innovation tend to be the most important aspects to developing new industries. The USA are famous for it and it rates high, for developing employment growth along with “reward for risk and effort” instead of the “wage capping” and other dumb-arsed micro-management and undue interference strategies inflicted by the UK socialist governments of Wilson and Callaghan upon the UK industry in their vain attempts at levy building in late 1960’s and 1970’s. The same levies which Dear MArgaret then had to tear down in the 1980's.

Friedrich – your posts re English manufacturing are completely nonsensical. If you have nothing to say, as seems the case, protect your dignity and say nothing, rather than write nonsense and diminish in everyone else’s assessment of you.