i mean, i think there needs to be further work on the label. i think there needs to be front of the pack labeling. i think added sugars and fats be greater disclosure. i think restaurants, certainly the chain restaurants, the information that you shouldn't have to go dumpster diving to get the information. what we subsidize with tax dollars need to change, our school lunch programs need to change. and allowing, and this is i think one of the key areas, allowing the industry to amplify the reward value of a reinforce of whether it is nicotine or whether it is fat, sugar and salt by advertising and adding the emotional loss i think we have to really rethink how we look at those things that enhance and amplify the stimulus. i think there is a lot of work now that we know that the brains of millions of americans are being hijacked. thanks for the question. let's take one more question.

las. . >> then it is much easier to pull the stimulus on everything else. what you what is its dairy and food. increasingly people are looking at food and saying, i don't even see any food here.

i want to eat something that is going to sustain me. i don't see any food there. that helps you look at the rest of this and say, i don't want that. i have finally gone to the point. i went to a food coach. i want to know, advice on how she spends her life. she said what you have for dinner? she looked at me and said did you know just you ate the equivalent of two meals in one sitting? how much to the need?

you are shaking your head. you need about 100 calories an hour. she said you ate 12 ounces of protein. i didn't even know what 12 ounces of protein looked like. i knew something like a palm been three. so what it involves is changing how you perceive what you want. in an earlier question we talked about loneliness. you want to eat because it's going to make you feel better you want to eat because you feel better. if you think that is what you want, if you look at that and say, that is my friend. that is going to make me feel better, there is nothing i can do. you have to change the way you look at that. that is not my friend. it is not want to make me feel better. you have to want something else. once you want something else it is easy to cool down the stimulus. that is how our brains work.

thank you very much. [applauding] >> david kessler has been the dean of the medical schools of yale university and the university of california san francisco. he served as the commissioner of the u.s. food and drug administration under president george h. w. bush and bill clinton. a graduate of amherst college.

>> she spoke at an event hosted by the east-west center in washington, d.c. the event is a little over an hour. >> well, good afternoon and welcome to the east-west center in washington. my name is satu limaye. some of us get lucky and get to go there once in awhile. we welcome you to this very interesting program we have on "the china price." a new book by alexandra harney. and we also have kimberly elliot also here as a discussant. we have us that the different format than usual today, and i just want to fly it for you. we have a c-span coverage of

this event, and so it is obviously on the record. but we're going to do is proceed until about 215 with the presentation, the comments, and the q&a. and then i'll just check if there is anyone who wants to make any comment or ask any questions off the record, at which point we will ask our friends from c-span to turn off the minds and the cameras. and if there isn't at that point anyone who wants to be off the record, that is fine. so again, welcome to the east-west center and to this program. let me just, you have the bias for both alexandra and kimberly. no need to mention their credentials and a vast capabilities on the subject. i would like to invite you to speak for 20-25 minutes. >> great. good afternoon. it's great to be here. thank you for having me.

it's great to be sharing the table. i've wanted to start out today -- i'm alexandra harney, the author of the china price. i would like to start out this abandoned by taking a poll. if you cast of mind putting down your sandwiches for a second. i would like to take a poll, if everyone could raise their hand if they are wearing or carrying something from china. you can check the back of your shirt. the underside of your watch. okay. the show of hands is the physical representation of the impetus for my book, which is the extraordinary influence of chinese factories. yet even as we were all of these clothes and carry all these items from china, i don't think we all know that much about what happens inside these factories. so i set out at the beginning of 2006 to do that, to spend as

much time as possible in chinese factories and to learn what makes them tick, who works there, their future. so i would like to tell you about a bit about me and help i can to spend all this time in chinese factories. not every girl in up on the line in guangdong province. and then tell you a little bit about the book and a few trends that i noticed. i was born and raised in the d.c. area. i went out to japan in 1997. and started studying japanese as the high-school student. at that time japanese companies were taking over rockefeller center, buying up pebble beach. it seemed to me and my parents like actions of the japanese because one day and might be

working for a japanese company. when i got to japan and joined the financial times as a reporter i had the opportunity to interview some executives from an electronics company. they just said casually that they were studying a mandarin chinese. and i said, well, they said because the chinese are going to take over our jobs. i ended up in hong kong as a financial times south china correspondent. it was not long after that i ended up being taken to visit a factory. you can imagine brose of women hunched over sewing machines, and i went up to them with the help of an interpreter.

she said she comes from the countryside hundreds of miles away to work in this city factory. just out of her teens. she was making about one of her dollars per month stitchings sweaters. i said, you must be so happy. one hundred dollars a month. you must be so thrilled. she said i don't really keep most of it. enough for tissue and soap. i thought, wow. we in the west know nothing about you in china. i would like to find out more about you. so that was the starting point of my book, mountain to know more about this woman. at decided to spend a couple of years -- originally only decided to spend a year and ended up spending a couple years in and

around the province talking to people who make consumer goods for export to the u.s. just to give you a snapshot of guangdong, it has a population of about one and a 10 million people during its peak. about a third of china's exports come from this one province, most of it from the pearl river delta, the area along the river that cuts up to the province. its gdp a couple years ago, $332.8 billion. making it slightly smaller than saudia arabia. it is filled with hundreds of thousands of factories. there are at least 400,000 factories. you don't really see the masses

of the people who work there. many of them are migrants from another part of china who come down and work for a couple years. you don't really see all these people except the morning and night and maybe sometimes at lunch. so you don't have a sense of how many people on board in there. one quick way to tell is to look at the laundry because all these people work in factories that have dormitories, and they all stay on campus. if you drive past you can see 4,000 pink shirts, and you know that factory has has pink unif. another 6,000 green shirts of fluttering in the wind. it is an incredible illustration of the number of people that fill those churchmen that are not they are not being lost. the workers, a small factory might have 1,000 workers. a factory in the same province that has 250,000 workers. i think it is the world's

largest. but really because it exports so much it is where our lives and the lives of china intersects. your computer, parts of your computer came from guangdong. so much of what we use every day comes from this one province. so my book focuses, "the china price" focuses on consumer good productions in guangdong. nibali due to the whole thing. to give you a taste of what a talk about, it's a series of narratives. in one of the early chapters a hong kong man now, he was young

laborer, years switching things together and his home after school. he grew up and has his own factory in southern china supplying wal-mart. he initially found it very difficult to supply wal-mart because since the 1990's wal-mart, like a lot of companies, has imposed a code of conduct which says we want you to follow the labor law and follow the certain restrictions to make sure that you are not abusing your workers and taking, looking after their needs. he found it very difficult to make goods at cheap prices and followed this comfort code of conduct. initially he decided to falsify documents relating to wages and treatment. so he had an entirely fake set of books, but he felt bad about having fake books. so he decided to create a fake factory instead. and when the inspector would come to visit, and this was

inspectors from various companies, he would show them this one factory. he called it his five-star factory. and it was a very good looking factory. good condition. for all the labor law. but that factory only produced 60 percent of his orders. another 40 percent were produced at a satisfactory, another secret subcontractor around the corner that had totally different conditions, not as nice. i get a chance to go to the doorway of that factory. he said you can't go in. you're a western woman. i don't even like to go and. sort of like when you make chicken. so i tell another story -- his story is showing the kind of

pressure that they are under. i don't think this man is evil. he has thousands of competitors who don't follow the law he is trying to make a reasonable profit. i'll tell another story about a guy from the countryside. a star math and science student. his mother falls ill. he can't afford to pay for her medical bills. he ends up in the factory also in guangdong province working all around the clock. and late one night he puts his arm into a machine, and the next thing he knows he is lying awake in a hospital bed and his arm is on. but instead of just allowing this to defeat him and head back to the countryside he decides to get educated, get smart about his rights, and he learns the ball, the chinese labor law and studies to to be a lawyer.

ultimately challenges his employer, former employer and becomes an activist helping other workers challenge their employers when injured or otherwise affected in a bad way on the line. so he represents, to me, a generation of chinese workers that i like to call the generation y. born in the 1980's. now in their 20s. many in factories today making the stuff that we use. they're raised in smaller families. china introduced the one child policy. in the countryside it is not necessarily one child. you could have two or three. they come from a small family. therefore their parents have less than a different attitude toward them. there are fewer of them because they come from smaller families. by some accounts the flow of the supply of 15-year-olds out of the chinese countryside has

already served a flow. they are more aware of their rights. they have a wider choice of places to work. so they have more leverage than workers did 10 or 20 years ago in china. they are using their leverage to stand up for the rights like the man i call ni-kong, the man who lost his arm. another set of his generation y workers i portray in a section of the book, not as depressing as story as the one i just told the, but it is about a woman who also comes from the countryside in eastern china, works in a few factories sewing sweaters and making dvd player parts until she realizes she wants more. so she decides she wants to become a saleswoman. i was with her as she discovered

this ambition in herself, and i decided to walk around with her as she applied for jobs as a cell . basically overnight she becomes a real-estate agent. red-wine drinking. and she really is a story that can only happen in china in a country that is growing as dynamically and quickly. but her ambitions say a lot about this generation of workers. they want different things. they want careers. they want skills. they want to learn english. they want to learn how to use a computer, and that is good for china because as she develops the city where she lives is also trying to ascend the value chain. trying to go from toys and

t-shirts to telecommunications. so i tell several stories. i give you all the stories you won't buy the book. in the course of all the research i came to one large conclusion which is that as china exports of consumer goons have skyrocketed over the last 20 years it is with our help that it has been able to defer payment for a lot of the cost in terms of workers' rights, the health of its workforce, the environment, and environmental protection. and it has deferred this giant bill essentially, and i stress, with our help as western companies and western consumers. and it is not the first time a country has done that got deferred the bill. every other country has gone through a transition. china has gone through it faster. and we are all watching it

happen. if we were around during the industrial revolution in england we might not have cared so much. now we all do care more about what happens in china. so i think what i saw or the time that i was researching was that china is starting to come to terms with the size of this bill that it has deferred. it is starting to catch up with china. so in terms of the big trends i see going forward, one of them is clearly the workers. about the worker i told you with the one arm. these more assertive workers, the demographic shift are referred to. this, i think, will have major implications for the china price and, indeed, for the chinese economy. if workers know their own value and are willing to assert their rights, we already have had a generation of ambulance-chasing lawyers in china. things are starting to shift on the ground. the second big shift we see is

the shift in the policy environment. obviously we all know about the appreciation since 2005. it has really accelerated in recent months. minimum wages are rising very quickly, partly in response to these young workers. but also because they had not been for so long. we are looking at double-digit wage increases in the coastal areas. wages are also rising in inland china. so it is not just a coastal phenomenon. the new labor contract law, there has been much discussion about this. i don't think it is being fully enforced yet. i don't think it is as big changes everyone is talking about, but it signals where the chinese government would like their manufacturing sector to go. as an aspirational law it is quite significant. clearly china is trying to wean its economy of the dependence on low and low-value, polluting,

resources-draining, non-tax-paying exporters and redirected towards more domestic consumption, more technology-oriented, more profitable in ends of the supplies and. so that is a big shift. along with that shift comes a shifts in the mentality of factory managers. i tell the story of two factory managers who are sick of making the profit. they decide to invest in businesses. one starts his own line of skiwear using designers from austria in hopes of recouping more profit. you have your own brand obviously you make more profit than making for someone else. another one decides to sell fabric on the side.

small ways to might more money and control more of the supply chain yourself rather than just be an oem manufacturer. so what we will see here, the implications that i see, that all of us will see on a daily basis is higher prices from china. we have already sent to see a bit of that. in fact, the china price has been rising since 2004. the trends i see is that prices will continue to rise. rising wages are not going away. i don't have any insight into beijing's thinking, but if anyone here has insight i would love to hear it. i think we will continue to get some more pressure for litigation, compliance with environmental laws. perhaps one day be will see greater enforcement of the labor law, but the direction of chinese policy is clear, and the direction of the demographics are also very clear. those two trends alone will lead to, i think, pressure on the

china price to rise. so i will leave it open then for more discussion. i'm sure there is lots to talk about. i will hand it over to you. >> great. i am just really delighted to be here to comment. i very much enjoyed reading it and i highly recommend it. i think she has really done an excellent job of describing the trends and putting a human face on it. i told her before the lunch started that i particularly enjoyed the chapter, maybe it was because that it was a little bit more optimistic. the girls and room 817. the story about how people cope with globalization and development, but how people can grapple opportunities. i also told her -- she mentioned this toward the end.

helping change. particularly talking about the china price that has been immersed for the last two weeks in the food price crisis. of course china had some role in that. some kind of a new twist these days. what it does underscore the outside role that china has in terms of affecting the global economy. we need to find ways to better engage in it. a couple of things i wanted to focus on in my remarks, one briefly and the other one in a little more detail. first how one of the very strong things that does come out of the book is, you know, how the law is operating in china on the fact that with the one child policy sort of reducing some what the supply of labor on the one hand and also changes in the world economy so that rural people have less motivation to

move to the city and take jobs and combined with the rising demand and rising export. wages and other conditions are improving in china. it is basically marxist basque army of the unemployed. slowly being absorbed. your supply and demand is working. this really isn't something that we emphasize as much, but it really underscores, for me, as someone who has worked on the worker rights and labor standards that ulimately growth is what will and a fundamental and sustainable way will change conditions for workers. the other thing that struck me thinking about that part of the book is that while things to do, incrementally, slowly changing for workers you know, less clear

may be on the environment. of the supply and demand factors, we all know that a market failure. so i think to a degree markets seem to be working in the labor area, not so clear mind the environment. that is obviously with climate change and negotiations, going to be a very big issue going forward. the rest of the time that i have, i want to get to the price that workers have paid for china's success and are still to some degree. even the growth is contributing to rising wages and improved conditions, there has been and will continue to be this pressure on the chinese government and on firms to do more faster, to improve working conditions. as someone who has researched the intense much of movement and

worker rights and ghts and these codes and the monitoring done around these codes of conduct in her story about the factory supplier for wal-mart, even there it was really quite stunning to me to read the degree to which factories and factory managers, i always knew that the whole monitoring bang, there was not a whole lot behind it. really conditions in these factories weren't really getting that much better, but the degree to which these managers feel compelled to falsify information, building parallel factories. there's one story in there about a consultant that will sell you software that will allow you to create something in 30 minutes. really brings someone who has not only studied this, but generally concluded that the anti sweatshop movement and the

pressure to do the scuds and launchers and is having positive effects. not fundamentally changing conditions, but having a positive. gives you a little bit of pause as what really is the negative. these are real resources. ..

>> that's market is not quite developing board does not seem to be developing the way we had hoped that it would. that got me to thinking what are some of the things that we could try and do? again the market will do a certain amount but it could be done a fairly low cost. how can we make this process work better when of the things we talk about in our book and

alexander's book is a interestingly what you find is it in some cases, the code of the buyers are demanding to protect the workers is not coincidence with how the workers see their own interest. like with how many hours or how much it over time they can work when they try to make as much money as they can to move on to something else or to send home. there is some balance between protecting worker health and how much overtime they would choose to work but it does seem coming in from outside saying this is what you must do is send particularly helpful. and the other area in our book where we emphasize the role of the workers is on the monitoring and enforcement side is of all auditing to

have the auditor come in from outside once or twice per year or that cannot be made to works of their house to be some rules for the workers who were there every day who see the conditions and they have to be comfortable. that goes back to the fundamentals is a buyer paying enough because the workers to not want to lose their job because of their comfortable with to have some role rather than just being interviewed and in terms of the buyers, what would they do beyond paying a price that would cover costs if they were serious about this? some of the things that occurred to me what alexander mentions in her book is what a lot of factories call audits and fatigue that most

factories not to supply wal-mart target and each has their own a set of monitors four or five times per year, a different codes an exit sign is so in case they can escape one-person wants a blue the other person wants to read if they were serious they could do it in a way to help the workers there would be more coordination and of the auditing process to lower the cost but she also says which i don't know if this is something we looked at in our book but some of the companies are fostering the audit cost directly not through loring's the price but on to the factories themselves and say they have to pay for the pleasure to be audited. in the way i view the codes and the monitoring of them and

the brands in particular the retailer's they buy brand insurance. they don't want to be caught in a sweatshop scandal and haven't heard their sales but also the benefit to them to have the bree and insurance so they should pay for the audits. the other thing that i think would be a sign they are serious is building long-term relationships with suppliers so if they invest in those conditions again there will be some cost to them as well as possibly to the buyer it would make sense for them to be some investment in the relationship. and i wonder if it has not happened so much from pressure from the anti-sweatshop movement but the recent quality and safety scandal. you would think the buyers have more of a bottom-line

interests to make sure the products that they sell are of a certain quality and are safe and that would put them more at a dollar benefit they could identify with a longer-term relationship which would deliver benefits on the labor side. what about the role of the anti-sweatshop advocates? they have a role that part of what they could do to help it is not to just play the game but look for violations and duties to these scandals, expos day, but to look at the indicators of the companies that are really trying you will not happen overnight and get a five-star factory everywhere but to least be willing to give credit for serious efforts to improve. and that relates to the role

of transparency and reporting as being key to make the efforts more credible. i suggest going back to the things that i identified as seriousness on the part of the buyers of they can be brought into the reporting i think that would be helpful to those who are trying to figure out who is serious. they can document are they coordinating with other companies or one of the multi stakeholder code efforts? maybe they can report how long they used particular suppliers and also whether or not they pay for the audits or the factory is. the last two things i will conclude is while i still say there is a role that could be done, if we could make the monitor process a real and a benefit but not a pure cost for the factories as well, but

nevertheless it still comes down for the need for the chinese government to enforce its laws. that is the only way you'll get surround the broader issue of if some buyers don't care because maybe they are not a brand but then they will go to another factory there is no incentive so what has to be about enforcement but in that area as well, one of the issues is whether or not the chinese lot is appropriate at this level of development and goes back to the issue what do workers want? again chinese law if a fully in force would very much produce income because it would put restrictions. so there could be some adjustment of the law to focus on a safety net when workers become unemployed or allowing more collective bargaining.

there is more sensitivity in china but if you find collective bargaining over the workplace issues in the way the government does not find a threat so the workers have more say in their preferences and what they will like to see improved. and not putting it restrictions on hiring that can have effects on employment and also drive even more factories and workers into the shadow economy which does not help anybody and the final thing i would say which is also particular in the last chapter is on the need for china to reoriented this strategy not to give up on exports entirely by a sitting on $1 trillion or whatever they are up to its reserves and growing as rapidly as they are, at china is over saving for its level of development

we consume too much and they consume too little and their needs to be more consumption of public goods and we talk about the inadequacy of the health-care system, education and especially in rural areas and more investment in a cleaner environment. so those would have the benefit of driving the cost of but also dealing with that trade in other affection china faces in the global economy. thank you for the buck. >> we have sufficient time for q&a so i will ask you to open up for comments or question but identify yourself and your institution in this first part of the session would anybody like to start?

>> [inaudible] i was interested in collective bargaining that sets up and as the old labor lawyer interested in human rights, they themselves end up in jail often. i wonder if there is any protection in developing for people who want to bring these cases against the government? the only way is to be

representitive by some legal entity. >> it gets to a few issues one is the fair trade unions and its role to protect workers interest. china all they had the one union the world's largest union 1,304,000,000 members and a growing. has added wal-mart stores to its ranks. by historical a they have not served workers interest rates very well because it is hamstrung as being part of the state and representing interest and in the book i talk cut to seven union representatives and i was in california last week and spoke to the son of one union representative in china news said they did not see any conflict in being both management and union at the same time. there seems to be no

independent voice for the workers. so clearly there is room for improvement and as it is on the massive recruitment drive to be strengthened by the new contract labor law other is the possibility as a ganes more members of has more money and the chinese government recognizes the urgency of the need to improve conditions especially in south china that the union can it have a larger role. role. i have no judgment yet. i have spoke to members to say nobody pays their dues you have to pay two percent of your payroll as a member company to the union and people are not willing to pay that so they have a real problem so it has one travel agency in their lobby just to raise extra money.

i think there is one of union operated out of a hotel in a shanghai so there is the issue of funding but also actual capability. the labor lawyers i know in china are not under as much pressure as you describe it depends on the nature of the case. but there's a lot of work out of hong kong-based say they have people signing up left and right to work with them. it is very encouraging and it seems a lot of the increased interest and workers' rights comes partly from the chinese government's efforts to use a lot but the problem is like in other countries it takes a long time to get your case heard of first and then the to get the case where the judgment enforced is another matter entirely. so workers are in a difficult situation where there are on-the-job and have to go to

hearings and through the old process and it takes years since and it is difficult to earn a living. the government has made a lot of effort to streamline the process they have lowered the cost of filing a labor lawsuits at $1. used to be too high. they have limited the steps and legal aid centers for migrant workers at the same time other legal aid centers are under pressure that they give visits and get harassed so it is a mixed picture as always but i do think it is moving in the right direction and of course, we can talk about the judges and how much they are paid and the potential for corruption that is the justice system. that is another e fined, another day. >> one quick comment they deliberately referred to collective bargaining and not act unions.

am i 88 local workers group so the idea is to try to find a way that is not the independent political force but something, obviously under freedom of association that is where we would like to me as fully independent but in the meantime it seems some form of organization that could engage in collective bargaining on workplace issues should not be a thread but should be viewed as an asset to the government which is worker unrest. alex is talking and a book of one example of a buyer and a company working together to hold elections for a worker representation committee in a factory. maybe that is too much of a threat but that is fully recognized will not have the

independent unions in china any time in the near future. >> with economic strategy, we're in the middle of a presidential campaign in which amazingly trade with mexico this is more than trade with china a. i guess that issue will come up. my question is what, if anything, are the implications of your book for u.s. policy? the next president whoever he or she is walks into the warehouse the first thing they do is read your book. then they call you? >> and by may 1 of the most crucial issues it is not a larger policy issue that we see going on in with that period adjuster is a product

safety issue cuts to the core of my book as it talks about the transparency of the supply chain and where the of goods are coming from an upper in case there is any past and seen supply chain of workers from basic conditions and if we are buying goods from china we need to have a better idea whether that is more inspectors on the ground from the u.s. government, inspectors from the chinese government and the companies that are invested clear the be need to have better clarity on when -- where our goods are coming from americans will not stop caring whether the babies are ingesting lead. china wants a product's we could collaborate more and there is a role for the private sector but there is a policy prerogative that would be aho tightening supervision

whether through the fda or another organization of the supply chain because in my opinion it is a little out of control we don't know where stuff is coming from. if you ask the most honest people out they will say we are not even sure where that product came from. that is scary especially if it involves things like heparin. that is one issue that is not the answer your expected but it is an issue of concern to ordinary americans that i would address. >> i am the u.s. a senior offical this is not the question now was going to ask buds of the issue of product safety, health products safety, food safety these are being addressed in it apec and

china is trying to identify the products and recently it with 27 -- to seminars on health. they are being acted in a big way. there are organizations that are working on the use issues. kimberly u.s said growth is the best way in order for us to show ultimately the workers and as you talk about the new generation and they're discover their rights end of the questions that i have with the potential downturn with united states maybe not consuming so much and what kind of impact this will have to workers in china, the aging population and the growth of

real competition in net southeast asia or some other economies five interested in hearing what you think of those issues and one final area just to let you both know, apec citigroup wanted to make a centerpiece for their global corporate responsibility. will and we are all all working with how we will shape this and it will be very interesting to see how china responds because their initial response has been not particularly shall we say ford leading? and will be very, very interesting to watch this discussion.

>> i would just say i would go back to where i ended my remarks that chinese to reorient itself with domestic sources sooner rather than later and they could cushion the effects of whenever degree of recession that we have here. i saw the two columns of this morning in the post that both shows slowdown in u.s. consumer should could be more along with -- long lives i will believe that but a more cyclical recession i am not convinced yet but we will see what happens. [laughter] >> that will definitely have an impact. >> talk about rising

competition from india and vietnam and parts of southeast asia, there are now planeloads of american executives arriving americans on the ground as they do not come. it is too expensive already pregnant inflation in vietnam is already 16%. and wages are rising very quickly not to mention that in fee and all the whole population and is smaller and on the much smaller scale. besides a lack of enforcement at this is a huge advantage. we're in an interesting and transitioned that we have the cluster is built up on the coast and now the world is looking for a place to bill

lacklustre is where it is cheaper and become more efficient and you take any industry i think of bra industry is in crisis. she is wringing her hands and she does not aware she can source of bra. it is not for attribution but it is interesting to see where they will end up. will they end up in india or vietnam? might experience is it is not that much cheaper to go inland but logistics' are a much larger percentage of cost rages are not as cheap as people would hope and they are rising. the tree business to grow trees was so profitable the people at this factory i was

visiting would not accept a the same wage. this was a bucolic farmland but yet they were paying more for their workers. it is a short-term alternative and india does not seem to be there yet so for the time being it is china. it is just where and i know everyone who sources from china is looking for a newer and cheaper factory. >> the ambassador mentioned taking of the issues with training and apec is it taken up with the strategic lateral '08 days bilateral with these kinds of issues? and with american corporations as well at home? >> actually american and dollars fund of the labor

activists that i write about in my book through various public funding and if it channels through the american ngos operating in china. >> i am from the center for global development. find a generational perspective i am curious, did you see the resulting in any type of friction with in the workplace with the younger workers who are managers of other parts of the company's how you see that play out with economic development or how businesses will react with the new generation? >> on a very immediate level the workers are difficult to manage. i went to a giant microwaves

factory talking to a manager and i quote that these workers are spoiled rotten zero. [laughter] and they are different from workers at the managers have had to deal with before. negative not generation y so i do not know but i hear that it is a generation and gap with an american companies. maybe you are technically. human-resources management question if you are a human-resources manager at china needs you now. says there is that and so a larger issue which i think is interesting is whether they can find the jobs that they want. university graduates are not getting jobs in this weird quirk of the chinese labor market the education system gives good theoretical training but apparently does not give people as good

practical skills so people come out and do not find work. you have that at the upper end of the education system but also among the migrant workers, they have the junior high school education it is not a small group of people. 200 million people that are not well educated because they cannot afford education to a higher level they cannot get jobs in the telecom factories with a junior high school education just as we talk about retraining a worker's was displaced so is china struggling with the issue to retrain the workers to find jobs at the higher end of the value chain because they are highly capable. i asked the girl in the book about this recently she said we migrants have great

skills, word lee skills we fend for ourselves, we may only have a junior high school education but we are capable but nobody would give them a second look because they do not have a high school certificate or have gone to college the university graduates cannot get a job at either but this is the economy growing at 12% it is a unique and unusual situations of china has a need for human resources and training. . .

>> the other east asian shifted the consumption. and is china different? is there something about china that might make it easier or more likely that china will? or are they going to follow the pattern of japan? >> you probably --

[laughter] >> that was a talking point. but i am not the china expert. obviously, i think, you know, in the short-medium run the needs of documents in the book are just so great in terms of health care and the environment that, you know. >> the address addressed the quf finding out contrary to kind of a widespread view. here it's not household, but more corporate. i think jim's argument was that the dynamic here is for the corporations. and so the actual ability of, let's say, the government or a household to consume more in the corporations, but the dynamic is

not the consumer. >> i guess i would also put another twist on it, which is coming back to the environmental question. i don't want the chinese to consume like we do, by any means. what i really had more in mind was more the public good and the government. and, you know, we focus so much. a think they have that government's surplus, but i have to admit that i'm not as up to date on those numbers. that is really what i had more in mind. and you can talk consumption. you can also call it investment in the public. either way it would be oriented more toward the domestic needs. >> what is the consumption percentage of gdp in the china? ours is about -- >> very low. >> about what? >> 48%. >> and ours is what?

>> 70%. >> seventy plus. >> 50%. >> consumption in terms of gdp has actually declined. >> it is actually lower than other developing countries. >> yes. >> domestic exports to gdp is much lower than china. >> no, i think you guys have covered it adequately. >> i have one question. it is not a fair question. i'm not sure. so that's part of our reason to ask it. i was just thinking about the problems. underestimate the problems that clearly you're going to have in collective bargaining. no question about that. but i guess, what was the reaction of workers that you

interviewed? from where they are, the problems, difficulties, and challenges, hardships, prevails that they face now compared to an utterly no opportunities to come to the cities and work, have jobs. i mean, are they optimistic that the gap time between the difficult conditions they face now and the improvements they expect to get from all of these efforts will be a much shorter span than what it took them to get from cultural revolution to the great leap forward to the prospect of improving things. in the scheme of time, and this team of economic development the real optimistic picture here is not in any way to undermine the current problems. my goodness. the gap to improvement will be a lot shorter than the gap to get to opportunity at all. >> right. >> i wonder how they reacts to that. >> the workers themselves were

not alive during -- the workers i know were not alive during the cultural revolution. so they don't have any memory of that hardship. but they are all a very optimistic reboot people. people often ask if whether i observed restlessness and the increased awareness would lead to wider social instability and a broader demand for rights rather than just limited labor rights. and i have not seen any evidence of that. there is no group consciousness among these workers. they don't sense that they are part of a national labour movement. they do feel there lot has improved, and to the extent that they are aware of the laws, they also feel that belt laws have changed in their favor. so they also don't feel that the gap between them and these of there very wealthy people in the cities where they are now living and working rking as large.

very difficult to narrow. so there are aware of the distance that it will take to get to the next run. indeed, if you only have a junior high school education it is quite difficult to mckee of thexd latter. and the girl i portrayed in the book who begins a real-estate agent was then knocked off her high run, as i was telling, and became of fruit cellar after the book book was published. really fell on hard times after that shenzhen government crackdown on property speculation. and was then sort of pressed into another economic, massive economic trend which is fruit inflation in china. so she was there trying to sell for it to a population that wasn't used to paying that much for and struggling after she had been trying to sell real estate

at a time when the government did not want anyone. >> could you say a word about the promulgation of the new labor law and to what extent it is really miss used, especially by the small marginal districts? is it something that can be adapted to by the broader array of chinese businesses, or is it a highly destructive situation for them? >> i think there has been a lot of fascinating over the labor law, the labor contract contract starting from when it was first floated in 2006. if you remember there was a big international controversy about it, international businesses raised concerns. i thought that was fascinating, if on the because of few years back no one would have cared about any labor law in china. all of a sudden it's in "the new

york times" and making waves in washington. so i thought that was interesting. i think there has been a lot written about and discussed about this particular labour law because it comes at a time when manufacturers are basically being hit by a perfect storm of other factors that are far more important than this liberal. the increase and rising raw material costs are way more important in terms of factory profitability than the labor contract law. because i haven't seen any good evidence of a massive increase in enforcement on the ground in china. if the labor law had been accompanied by a flotilla of labor inspectors then for some reflection, but as it seems to me right now there is a lot of talk because at least when i left china the implementing legislation left in guangdong province for the labor contract

law had not yet been passed. so there was an opportunity for others to voice their concern to water down some of the provisions locally. it so this is just my personal opinion and is purely speculation, but at think that is where we see all these reports about it is so difficult. and it is death and the more difficult. it's more difficult now than it has been in years. it is more dominated by other factors. for some of the labor contract was the last straw. >> as a factional point, there are lots of exemptions. is that true? >> yes. >> is an across-the-board? >> you can get a waiver. even in hong kong you can get a waiver if you want to make nice in the middle of the night. so, too, in china if you apply to a local government for a waiver you can get a particular waiver, for example, for overtime restrictions or for

certain parts of the labor law. i don't know inside enough factories. the final things came into of fact. whether there are a lot of people getting waivers, but you would imagine. >> one way. >> one way to cope, exactly. >> i just had one. >> yeah. >> i've wanted to ask you about that china price. the factories now. there has been much discussion now about water resources and resource management, trying to get fresh water. it's being funneled and. of course rumors that afterwards there will be an enormous impact on some of the cities from which the water is being funneled. can you speak to research management?

>> the only thing i will say is i think it is fascinating the way they are shutting down these factories around the time of the olympics and the movement of so many workers out of beijing. there is a very high price to hosting the olympics. it would be very interesting to be a resident of a town that had the factory from the other town. basically the dumping ground for pollution. maybe the new factory is very high tech and doesn't have any pollution. that's possible. but i do think it is an interesting phenomenon to temporarily shut down these things. and the key, the real test will be but beijing does in terms of water resources and pollution after the olympics. but the temporary, sort of, suspension of business during those two weeks will be one thing. in the years that followed it will be much more important.

>> well, let me thank our speakers, both of them, our presenters. alexandra harney and kimberly elliot. thank you very much, indeed, and thank you all for participating here. i think on the sign-in sheet there is an opportunity test sign up for e-mail updates for other programs. if you wish to do so please leave your information, and we would be delighted to have you back here again. thanks very much, indeed. [applauding] >> alexandra harney, former editor for "the financial times," served as the newspaper south china correspondent for overglazed 2003 to 2006. for more information visit thechinaprice.org.

>> this month c-span2's book tv weekend continues during the week in prime time with more books on the economy, history, and politics. >> "the uncrowned king" by kenneth whyte, publisher and editor-in-chief, is a biography of william randolph hearst. an innovator and committed journalist. it covers the perio d from 1896