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Monday, April 10, 2006

The US & The Fear Of Chinese Products

Randall Stross has busted the myth about Lenova on multiple fronts in an excellent thought provoking article in New York Times titled “Looking at the Free Market, and Seeing Red”. Pointing to the latest Lou Dobbs rant on state departemt’s plan to buy Lenovo PC’s. The State Department seeks secure network communications, it "turns to Communist China," and thus renders the United States "perhaps more vulnerable than ever” so says, Lou Dobbs. Lenovo recently won a competitive bid to sell the State Department $13 million worth of personal computers. Michael R. Wessel, a member of the U.S.-China Economic and Security Review Commission, an advisory body to Congress, said that the State Department would use the Lenovo computers in offices around the world, potentially providing China access to "some of our deepest secrets," a "treasure trove of information they could use against us. Technological correctness apart, it needs to be noted, I.B.M. and three American private-equity firms are big investors in Lenova and the largest block of shares is owned by public shareholders. (Its shares are traded on the Hong Kong exchange.) Lenovo is headed by an American, William J. Amelio — a former senior vice president for Dell, as it happens. The geography of the globalized supply chain that underpins the computer industry does not respect power blocks. All players, even the "100 percent American-owned" vendors, have a major presence in China. The PC’s are getting assembled in the US , says the article. Essentially these forces by parading nebulous concerns centered around “security issues” a new form of protectionism is being attempted – and in the process make a global company operating in an increasingly commoditized space take the hit. Time to set aside such things guys – the time that these forces spend discussing on such things –china and other nations are working hard to create more and more value added stuff creating surplus on other things- eventually the debt of rich nations get funded through such means.

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