Global East Asia Response Paper

John A. Mathews & Hao Tan (2014)

Chap. 3 readings � Steger, Globalization, chap. 3 “The economic

dimension of globalization.” � Jenny Chan, Ngai Pun, and Mark Selden,

“The politics of global production: Apple, Foxconn and China’s new working class.” japanfocus.org (2013)

� John Mathews and Hao Tan, "China's Continuing Renewable Energy Revolution: Global Implications." japanfocus.org (2014)

Feb. 28 Wed. Chap. 3 Recitation

Chap. 3 Response paper due Tues. Feb. 27 @ 10:00 PM

Steger Chap. 3 review � Building blocks of the Global Economic

Order

Three building blocks of 21st c. Global Economic Order: 1. Huge transnational corporations (TNCs) 2. Powerful international economic institutions

� IMF, World Bank, WTO 3. Large regional trading systems

� APEC Asian Pacific Economic Cooperation � EU European Union � [TPP TransPacific Partnership]

Terms What to call the global economic system? � Neoliberal capitalism � Global Economic Order What to call Apple and Foxconn? � Multinational corporations � Transnational corporations TNCs

Chan, Pun, & Selden’s essay 1. “The politics of global production” explains exactly

how TNCs function as a building block of the Global Economic Order.

2. The article also shows how highly integrated global commodity chains give workers some leverage to fight for improvement of working conditions.

3. State-business collaboration provides infrastructure and workers for contract manufacturers in China who supply corporate buyers with goods, fully integrated into the global economy.

Power asymmetry

Corporate Buyers (Apple)

Contract Manufacturers (Foxconn)

Power asymmetry

Contract Manufacturers

(Foxconn, Pegatron)

Factory Workers

Power asymmetry

Corporate Buyers/ Contract

Manufacturers

Factory workers

Turning point: 2001 China enters WTO Foxconn became China’s leading exporter the same year (2001) and still is today � Foxconn’s recent expansion of factories

moved from coastal Chinaàinland China

China’s “Go West” project Designed to spread China’s wealth to interior parts of the country � Eases urban immigration & overcrowding � Manufacturers take advantage of lower wage levels

there � Promotes ethnic unity � Stimulates employment in interior areas

Foxconn’s U.S. expansion Foxconn CEO Terry Guo's speech at U.S. Congress press conference July 26, 2017 https://www.cnbc.com/video/2017/07/26/foxconns- terry-gou-announces-new-plant-in-wisconsin.html

Wisconsin Sentinel 11/9/17 http://www.jsonline.com/story/news/politics/2017/10/0 9/foxconn-growth-could-staggering-but-risks-real- racine-county-wisconsin/737616001/ (5.40)

Electronic devices OFF

Mathews & Tan: China’s continuing renewable energy revolution: global implications 1. China is the world’s largest manufacturing

system: “workshop of the world” 2. Manufacturing requires huge amounts of

electricity [and water] 3. China is rapidly shifting to renewable

energy sources to produce its electricity

Mathew & Tan: opening paragraph

“China’s green energy revolution…..continues to astonish all observers and to terrify some.”

� Question: Who are the terrified observers?

Ans: Energy producers Carbon-based energy producers � Oil � Coal � Natural Gas (LNG)

2001 China enters WTO

� Chan, Pun, & Selden: Foxconn became China’s leading exporter in 2001 and still is today

� Mathews & Tan: 2001 marked beginning of drastic expansion of the energy system

Two turning points 2001—China joined WTO, signaled it was “open for business,” and dramatically expanded its coal-burning electrical generation system to meet demand

� Historical pattern in West from 19th century 2013—China’s energy tipped more towards WWS, away from fossil fuels and nuclear

� the world’s most important generator of wind power � largest capacity � largest addition of new power capacity

Coal first, green next � OLD APPROACH “In the time-honored way,

replicating the actions of the West in the 19th century, what was expanded initially was the coal-burning system.

� NEW APPROACH “But the build-up in thermal (coal-fired) power has been complemented by the rise of renewables.” (p.2)

Wind farms—land based

Wind farms—ocean based

Climate change & strong winds

New design wind farm

Wind farm ‘pods’

Hydropower Three Gorges Dam

Yangtze River, Three Gorges Dam Operational since 2012, the 400-mile long reservoir behind the dam generates 22.5 megawatts by turning 26 turbines. � Generated almost 100 billion kilowatt-hours of

electricity in 2014, surpassing the Brazilian- Paraguayan Itaipu dam.

� Prevented 100 million tons of carbon emissions in 2014; equivalent to burning 49 million tons of coal.

Hydropower: is it green? � Displaces people and submerges

archeological sites � Landslides: vulnerable to/cause of � Earthquakes: vulnerable to/cause of � Creates drought downstream � Silt and sediment concentrate pollution

behind dams

Solar energy Uses photovoltaic cells to convert sunlight into electricity

� Semiconductors absorb radiation and emit electrons, which are harnessed as electricity

� Indefinitely renewable � Requires little maintenance � No mechanical parts than can fail � Completely silent

Solar farms—land based

Solar farms—ocean based

Solar bike lane Daejeon to Sejong

Increasing appeal of solar energy

� Conversion of sunlight to power (current max. now up to 30%) is increasingly efficient

� Initial cost is high, but getting lower

Drawbacks to solar power � Cannot generate power at night � Reduced generation of power under cloud

cover

Implications for the future 1. China’s will be the first major world

economy to be fueled substantially by green energy

2. Green energy represents a secure energy future for China

3. Manufacturing will increasingly shift to producing green equipment to run the wind, water, solar projects

“China’s air pollution on the rise” � https://www.economist.com/blogs/graphicdetail/2017 /01/daily-chart-1

Implications of analysis by Mathews & Tan “China’s carbon emissions are set to peak and then to fall—and fall faster than in the US or in Europe.” (p. 7)

China’s electrical power system China is now the most electrically powered nation on the planet

� Both US & China now have electric power systems over 1 trillion watts, with China having a slight edge

� But per capita power consumption remains one quarter that of the US

China (p. 9) contrasted with U.S. “Renewables represent a means of expanding energy supplies based on expansion of manufacturing activities and their supply chains—something China is very good at…”

U.S. (p. 9) “…rather than on expanding extractive industries for fossil fuels around the world and securing them with military force.”

Mathews & Tan argue that— China’s economy increasingly relies on:

� Fossil fuels—carbon based � Renewables—water, wind, solar (WWS)

US economy increasingly relies on: � Fossil fuels—carbon based � (Less reliance on renewables: contradicted

by 2016 US renewable energy data)

U.S. March 2017, WS energy 10%

http://news.nationalgeographic.com/2017/06/solar- wind-renewable-energy-record/

Solar/Wind more cost competitive

“Earlier this month, National Geographic reported that climate progress could not be derailed by the U.S. pulling out from the Paris Agreement for six reasons—the first among them being that solar and wind have become more cost competitive than coal.”

Japan’s turning point 3.11.2011 Earthquake and tsunami on March 11, 2011, led to disaster at Fukushima Daiichi Nuclear Power Plant (NPP). � This dramatic event completely changed the

perception of the future of nuclear energy in Japan.

China’s economy is maturing Mathews & Tan: China is investing in renewable energy sources

� Represents energy security � Manufacturing shifts to production of

renewable infrastructure � Service sector expands

Service sector—U.S. The Bureau of Labor Statistics (BLS) defines service sector to include all industries except goods-producing sector like agriculture, mining, construction, and manufacturing.

� 2008: 77.2% of US jobs were in the service sector

� (over 3 out of 4 jobs)

� 2018: projected to rise to 78.8%

� (close to 4 out of 5 jobs)

Service sector—China � 2007: 42.8% of China’s jobs were in the

service sector � (2 out of 5 jobs)

� 2015: rose to 51% � (over half of all jobs)

Industrial sector—China � 2007: 45.8% of jobs were in industrial sector � 2015: dropped to 40%.

� 51% service sector, 9% agriculture sector