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Q: Soaring commodity prices China number one problem??
Just read a survey that said locals think this is the number 1 ....Problem What do you think??
when prices go up and salaries stay put, then it is a problem in China and elsewhere. All of a sudden, you are faced with choices, what to cut to make ends meet. And for Chinese, there ain't much to cut off, maybe less rice each meal ?.
I do think that it is a problem for locals to make lots of noise about. Is it a true increase in cost ?. Certainly not in labor cost, so from where does the increase come ?. Many will say is greed, and I do think it is a combination of different factors, where greed does play a role, but other things also do.
Xpat.John:
Actually, the cost of labor over the last several years has increased dramatically. Just look at the current base income in any city compared to what it was 5 years ago. You will find that it has increased almost 100% or more in some places. Factory workers who used to work for 400RMB a month now receive 800-1000RMB a month. I am not saying that all the commodity increase comes from salaries (and the associated taxes) alone, but it is a major factor. Another factor is that along with increased salaries, there has been a huge increase in competition of goods factories that drives profit margins lower & lower in order to compete. When you put these, and other, factors into perspective it is easy to see that the rise in costs is not purely from greed.
Income disparity and government corruption are right up there, but do you think a government backed survey would put corruption at the top of the list even if it was really #1?
China is turning into what the the US is becoming....great place to live if you are rich, not so nice when you are poor.
