Later this week I will be in Beijing for the CIBE Ethics Conference. Schedule and Internet access permitting, I will try to make a post or two from the conference. While in town I will also meet with some firms for possible company visits in June. More to follow on this upon my return to SLO.

While in Beijing have also put together a reception for friends of Christine Lu and The China Business Network, friends of Lonnie Hodge and David DeGeest and The China Dreamblogue Project, and friends of the Cal Poly Orfaela College of Business. These individuals will also be in town for the CIBE conference.

If you are a friend of one of these groups (or wish to become one!), and if you will be in Beijing on Friday, October 26, I hope you will join us.

Event: Meet and Greet with Friends of China Business Network, China Dreamblogue and Cal Poly Orfalea College of Business

Date: Friday, October 26
Time: 9:30 pm to 11:00 pm
Location: Grand Hyatt Beijing — Fountain Lounge (hotel is located at 1 East Chang An Avenue)

Click HERE for the Grand Hyatt web site (which has a map and directions on it; and no, I am not staying at this plush hotel - I can assure you my hotel and budget is much more humble and low key!).

This is meant to be a low key get together and event. Just drop by and come hang out, meet some wonderful people, and have a good time. We are looking forward to seeing old friends and meeting new ones at the Fountain Lounge in the Beijing Grand Hyatt on Friday, October 26, at 9:30 pm.

Submitted By: Dena Malloy

Take a look at this Wall Street Journal article and this New York Times article.

Recently in the news, there has been a firestorm of recalls of Chinese made goods. One of the companies that was forced to make a recall was Mattel. The company has recalled approximately 18 million toys in total. About 3 million of these toys were recalled due to lead paint. Lead paint is certainly not good for the health of a child, but no harm has actually been proven to have occurred. The other toys contain small magnets that pose a hazard to children that swallow more than one of them. When the child swallows the magnets at longer intervals (20min – 1 hr), the magnets can attach to each other inside the child’s intestine and become stuck, perforating the intestine. One child died in 2005 and several have required surgery to remove the magnets. Almost all of these toys were made China, but the magnet problem is a design flaw.

Was Mattel trying to throw China under the bus? The design issue with the magnets is not new. Why recall now along with the toys containing lead paint? Did they finally have a way of making someone else seem responsible? Did they get busted and have to apologize or are they strategically apologizing just to keep on the good side of their biggest supplier? Are they now going to be sued because they have admitted to a design flaw causing harm?

I personally think that Mattel was hoping consumers would blame the magnet problem on China and I think that overall it has worked. I’m sure many of you knew that Mattel recalled a large amount of Chinese made toys, but I bet fewer numbers knew that the majority of the recall was due to a design flaw. The later apology was probably planned the whole time knowing that the recall would make headlines, but the apology would barely be noticed. The Chinese government has a right to be upset. Mattel’s profit are made by producing their toys in China.

Am I too cynical? Do you agree or disagree?

Submitted By: Brandi Eng-Rohrbach

I just read an interesting article in The Economist titled, “Missing the Barefoot Doctors”.

This article was interesting to me because it highlighted the fact that China is also facing a health care crisis like the rest of the world.

In the United States currently “47 million Americans, or 16 percent of the population, were without health insurance in 2005.” (Source: National Coalition on Health Care) .  It appears that currently neither the free-market system employed by the United States nor the universal government programs employed by the likes of countries like Canada are working.  The free market system moves health care out of the reach for many and the universal system is plagued by inefficiency and long wait times.

In this article, it appears that China has developed a novel approach. This is a system of public insurance, whereby health care is not free but paid for but insurance is sold through the government. This system would seem to be a way of creating a synergy of the two dominant systems. It encourages efficiency like the free market system by creating a system of deductibles and co-pays. This encourages people to use the system only when the necessary and this reduces unnecessary visits. This keeps waiting time and costs down. The Chinese system also features the advantages of a universal health care system. It maximizes consumer surplus because the government sells to consumers at cost. It also takes advantage of economies of scale. These two things drive down cost and make it available for more. I think this is an interesting solution to the health care crisis.

I do realize that the article, in fact, highlights why such a system is not working in rural China. First of all, the insurance is too expensive. It is the equivalent of 11 days pay. Second, the co-pays are too high. People in rural areas are forced to pay 40% of such treatments. This is equivalent to four months’ income. These prices make the insurance too cost-prohibitive to be used and do not allow the government to take advantage of the economies of scale that could be realized. Still if such a system was tweaked it could provide a novel approach to a global problem.

In addition, I think another issue highlighted in the article is quite disturbing. This is the fact that China follows the “One Country, Two Systems” policy not just in an economic sense, but also a social sense. The health care system directly discriminates against people based on their birth location. It does not allow people born in rural areas to have access to the urban health care systems even if they relocate to a city. This is a direct discrimination against people from rural areas. This is disappointing to see as much of China’s continued growth relies on the migration of people from the rural to urban areas.