Bingo. The fact is the older obsoleted factories have often been dynamited to avoid taxes on "improved" real estate. Cutting edge industries have typically been relocated, machine tools and all removable fixtures to China. If such industries don't move of their own accord, seduced by the drastically skewed artificial forces of economic gravity to the "low-cost" center of the universe, or the chimera of potential Chinese "orders" (get in on the ground floor of the fabulous Chinese market NOW!), then China doesn't hesitate to use its $500 billion hoard to buy out our technology and industry.
Magnequench's theft is a case in point. I have no doubt that the Xlinton-team was part of a corrupt 'deal' to coerce GMAC into relinquishing a profitable division, then wink as a crucial technology, a vital industrial component of national security was taken. The Xlinton-appointees have perpetuated the theft on into the GWB administration. So far, China has refrained from going after Grumman, Lockheed, or Boeing. But it's only a matter of time. They are getting them piecemeal now, anyways, as 'partners'.
A perfect illustration is how Boeing has been steadily been sucked into increasing its production in China, for essentially no real increase in Chinese purchases. A zero-sum game almost. Meanwhile, the Chinese Press just glosses over why they are getting these high-technology business "investments". Read between the lines of the following article from June:
Chinese to Partner on Boeing Airplanes, 7E7 Dreamliner
BEIJING , June 10, 2004 - Boeing [NYSE: BA] today, with China Aviation Industry Corporation I (AVIC I) and China Aviation Industry Corporation II (AVIC II), signed memoranda of understanding to provide parts and assemblies for Boeing airplanes, including the rudder for the Boeing 7E7 Dreamliner. The signing celebration at the Boeing China office marked the first announcement of Chinese suppliers selected for Boeing 7E7 opportunities.
Boeing will work with Chengdu Aircraft Industrial (Group) Co. Ltd. (CAC), an AVIC I affiliated company, for supply of the rudder -- a key component of the vertical fin that provides stability for an airplane's directional control. Boeing is developing additional opportunities for Hafei Aviation Industry Co., Ltd (Hafei), an AVIC II affiliated company, to produce metallic and composite parts and assemblies for various Boeing jetliners, including the 7E7. The total value of China opportunities with Boeing, including the 7E7 rudder and work on other airplanes, could reach several hundred million dollars.
"China has an important role on the 7E7 program," said Jim Morris, senior vice president of Supplier Management for Boeing Commercial Airplanes. "Chengdu Aircraft and Hafei represent the talents, technological capabilities and resources of Chinese aviation industry that Boeing needs to provide the best value to our airline customers."
Other officials joining Morris at the partner signing event were Yang Yuzhong, executive vice president, AVIC 1; Luo Rong Huai, chairman and president, CAC; Xu Zhangbin, vice president, AVIC II; Wang Ning, Hafei; and David Wang, president of Boeing China. Also on hand was Mary Armstrong, vice president and general manager of the Boeing Fabrication Division, representing the Composite Manufacturing Center , through which the rudder contract is managed.
"We are honored to be one of the first supplier partners in China to be named to such an important role supporting the Boeing 7E7 Dreamliner," said Luo. "We want to add our strengths to make Boeing's Dreamliner dream come true."
Commercial aviation is crucial to the advancements that will sustain continued economic growth and development in China . Boeing has worked together with China 's aviation industry for more than 30 years. To date, Boeing has procured more than $500 million of aviation hardware from China.
Today, more than 3,400 Boeing airplanes -- one third of Boeing's world fleet -- have major parts and assemblies built in China. Examples of major parts and assemblies built for Boeing by Chinese industry include the 737 horizontal stabilizer from Shanghai Aircraft Corp., 737 vertical fin from Xian Aircraft Corp., 737 tail section modules from Shenyang Aircraft Corp., and 757 empennage and aft fuselage section from Chengdu Aircraft Corp. All are AVIC I affiliates.
Boeing is China 's largest commercial aviation partner. Over the next 20 years, Boeing forecasts China will need 2,400 jetliners, becoming the world's second largest airplane market.
COMMENT: China does not intend to give orders for 2,400 aircraft to foreigners. They will expect, after the first hundred or so, to be fully Chinese planes. Patience, and the West will surrender all, for mere promises.
I estimate that in a war emergency, I could set up an injection molding plant in one quarter, a PCBA assembly plant in two quarters and a steel mill in 4 quarters. My biggest challenges would be mobilizing my professional workforce. I also assume I would be able to get equipment from foreign, non Communist, pro Western sources and would have an active venture capital community to draw from. Remove either assumption and your talking a time multiplier of anywhere from 5 to 10 X.
Thanks for the ping!