I have to comment on one other thing; materials and testing. I know this from experience working in the "toy" business. There is a great deal of testing done on toys, more than the "average consumer" can begin to realize. If you want a surprise call Bureau Veritas and ask them to send you the list of potential tests for "toys" (there is category after category). Before a toy can be sold every aspect of it must be tested. On top of this, most "big" (think top three) companies require you to submit the results of independent testing as well as have their own internal tests facilities where they supposedly "test" incoming product. In my experience, there is no way (wish we had italics), NO WAY someone in the USA didn't know that there was lead in those toys. I'm not a "conspiracy" person but it is so much easier to blame someone on the other side of the world and claim "We didn't know" then to a.)have a recall and b.) find out an "American" let this stuff "slip" through and now (s)he loses their job, sets the company up for lawsuits, and maybe criminally at fault, etc. Better to just point the finger and claim stupidity.
My point is if we are going to "do" anything about this problem we have to change the way people think. Many USA companies would never dream of asking "Are all your software licenses in order and can you prove it? Can we do an audit?". They simply want to know that the work will be performed and and cost as little as possible; regardless of "how" it gets there. Another example (and then I'm done); after 15 years I finally got up the nerve to ask my friend why the bathrooms are so absolutely disgusting (if you've ever been there you know what I mean). He said "They think the bathrooms are clean"...
Over the last 20 years I've spent a great deal of time in and done business with "China". I will agree that it is very important to "get to know" who you are working with (I in fact know the wives and children of the people I do business with and agree on this point entirely). I trust the people I work very much; however, again, this is after working with them for many years. I have associates that have been "bitten" by the "borrowed IP" and have paid dearly for it. People in the USA do not realize the extent to which "they think differently"; the traffic light example is a good one (I once watched a driver drive down the wrong side of the road because of congestion on the "right" side of the road and did so with impunity). I was once at a "CD" store looking for a particular piece of music (an all-girl group playing traditional Chinese instruments performing Western music) when I saw an entire display for "software". One DVD contained Solidworks, Pro/E, Photoshop, etc. The DVD cost US$5.00. When I asked my friend how they got away with it he said "They only consider the actual DVD to be of value, not what's on it". I had a very frank talk with him (he was also a vendor of mine) about piracy and how I felt about it (I make my living from IP). This talk escalated to the level to which we ferreted out any pirated software that was being used in his company and they bought licenses for everything, while I was there. It was a matter of making them understand a different point of view. I'm not going to say they are (were) "angels" and for all I know they may have let their licenses lapse. -CONTINUED-
"To me, it's almost like saying that to compensate for the reduced government control of everything comes an increase in self control, with penalties when this self control is not exerted."
Whenever people live together in groups, there must be agreement on what behavior is acceptable, or the group does not survive. And there will be controls in place to enforce behavior. In some cases the controls will be internal - people will do or not do things voluntarily, because of their beliefs about what is right and wrong. In other cases, the controls will be external, like laws prohibiting or regulating some kinds of behavior, with punishment by your society if you break them. (Or both, with laws specifying punishments for those expected to know what is right and wrong who go ahead and do wrong anyway.)
Part of the issue for China is that the social agreement on acceptable behavior that worked when China was still largely isolated from the world does not work in a global economy that has different expectations. They are still learning the rules the rest of the world plays by in activities like this, and the process will be slow with bumps in the road. You don't change ingrained cultural patterns quickly.
A contact of mine is an IP lawyer, and her feel is the same as mine: the Chinese divide the world into Chinese and "Everybody else", and a different set of rules apply if you *aren't* Chinese.
If I were an American tech outfit interested in working in China, I'd be at pains to carefully select my Chinese partner *and* to make sure my partner had the appropriate contacts in the Chinese government. My partner would need to see the tech I was supplying and it's relationship with me as critical to its own success, and the government would need to view the relationship as important to China's success.
If those were both true, I might have a hope of success, and some actual protection for my IP. Otherwise, you get the comment made by an American executive re IP in China, who said "Bring suit against a Chinese company in a Chinese court for IP violation, and tell me what you get."
And forging that relationship would not be a quick process, as it would require personal contact between my top people and theirs over a period of time. I recall a story elsewhere about an American working on a deal with a Chinese company, where a prolonged amount of informal social contact, drinking tea, and admiring pictures of each other's kids was needed before getting down to business, because the first question the Chinese CEO had was "Can I work with this guy? Do we get along well enough as people to be able to work together as partners?" (It's a question I think most US executives don't consider till a failure of personal realtionships bites the business.)
I'd assume the same trying to work with China now.
Very good point, and very good analogy with the traffic lights. I actually came to a similar conclusion, when all the baby formula scandal and lead in children's toys stories were in the news.
With capitalism there has to be an associated measure of responsibility, which comes with penalties for violations of the law. It's not as simple as grab grab grab.
To me, it's almost like saying that to compensate for the reduced government control of everything comes an increase in self control, with penalties when this self control is not exerted.
I think transfer is a euphemism for "theft". China if they want technology, need to put the big bucks where their party mouth is. No one will hand you over their IP. China needs to spend the money and resources necessary to develop their own IP. Otherwise, China will be stuck in their "cheap manufacturer" of the world paradigm. Just like the US has spent the time and money to develop technology that the market wants, China needs to follow suit, otherwise the Chinese strategy has plateaued and isn't going to get the wantabees any further towards owning key patents and know how that other countries will want and use. Communist party edicts don't work outside the chinese sphere of influence.