Global Glance: December 28, 2015
A quick look at intriguing international stories
By John Bostwick, Managing Editor, Radius
Welcome back to Global Glance. This week we look at:
- China’s workplace culture and its evolving labor movement
- Why more Americans are renouncing their US citizenship
- Global New Year’s traditions
China’s Workplace Culture and Its Evolving Labor Movement
An article in last Tuesday’s BBC.com addresses a familiar global economic theme: managing employees from another culture. The article is in part about a representative from a US furniture company establishing a China-based office with 70 local workers. Here’s one striking observation from the piece, which references McGill University professor Saibal Ray: “Perhaps the most important lesson [for foreign managers] is that the Chinese often work far longer hours than most Westerners, Ray said. Many assume they’re on call 24-7, and will arrive early and stay for hours after the boss has left.”
The mindset Ray describes may actually decrease efficiencies because, as the article notes, “numerous studies have shown working longer can actually hurt productivity.” Aligning Chinese employees’ strong work ethic with a foreign company’s culture can be one of the chief challenges for Western managers operating in-country. Professor Ray recommends a measured approach: “You have to give the impression that you, as the manager, work as hard as your employees. … Then slowly, you can change to more reasonable hours.”
One wonders how China’s citizens feel about their country’s unremittingly demanding workplace culture, described by one US-based recruiter in the BBC.com article like this: “People work twice as much as in Europe or the US. The pace is twice as fast.” Perhaps not surprisingly, some Chinese workers are publically expressing dissatisfaction with their workplace conditions. The Hong Kong-based NGO China Labour Bulletin reported this month that the number of strikes and worker protests in China reached record high in November.
For a good summary of China’s evolving labor movement, check out “The Chinese Labor Problem,” posted in January of this year on the New York University School of Law website. The article explains that China’s only labor union, the All-China Federation of Trade Unions, “is recognized by many as an appendage of the Communist Party and, at the plant level, submissive to management. Its mission is more to placate the workforce than to respond to workers’ needs.”
The article is largely a look at the research and observations of Cynthia Estlund, an employment law scholar at NYU Law who sees some parallels between China’s rising labor unrest and the US labor movement of the 1930s. Still, those respective movements have at least one important difference: China has a single government-affiliated labor union, while US unions have always remained independent of the government. Also, of course, US workers have always had the power of the democratic vote.
While noting some of the Chinese system’s dysfunctions, Estlund also recognizes some of its considerable merits: “[China] was a closed, poor, totalitarian society until 1976. The economy and institutions of governance were in shambles after the chaos of the Cultural Revolution. It’s just remarkable that, since then, they’ve brought hundreds of millions of people out of poverty. Something like 75 percent of the worldwide reduction in poverty over the last 20 years was in China.”
For another look at China’s ongoing labor movement, read “Strikes Proliferate in China as Working Class Awakens,” published by The Boston Globe in April. It describes how millions of migrant workers in China are increasingly aware of their rights due to the internet, and how the Chinese government is trying to cope with the “awkward” problem of worker strikes and protests. As one Chinese labor scholar explains in the article, “The party has to think twice before it suppresses the labor movement because it still claims to be a party for the working class.”
Why More Americans Are Renouncing Their US Citizenship
In today’s global economy, expatriate assignments are increasingly common, and many expats have highly positive experiences. But even most of us who are interested in the subject of US expats going abroad rarely consider the subject of permanent expatriation, or renouncing one’s US citizenship. An article published last Tuesday’s Wall Street Journal addresses that topic.
“What Giving Up US Citizenship Really Costs” describes some of the important tax- and immigration-related consequences of renouncing US citizenship. For example, well-heeled Americans that want to go on permanent holiday are subject to an exit tax. The law “treats many renouncers as having sold all their world-wide assets on the day before the renunciation, even if the person will continue to own the property and pay tax on it.” And renouncers’ US-based heirs will also find that any inheritances sent back to the US are subject to high tax rates. In addition, federal law stipulates that “US officials can deny entry to any person who has renounced citizenship for tax reasons.”
Despite these and other drawbacks, the Wall Street Journal’s Law Blog reported in May that the number of Americans renouncing their citizenship is on the rise. By law, the US government publishes the rather dogmatically titled Quarterly Publication of Individuals, Who Have Chosen To Expatriate, as Required by Section 6039G. The Journal indicates that the numbers in the first-quarter report put the US “on pace to exceed the total of 3,415 renunciations in 2014, which was itself a record. That was up 14% from 2,999 individuals in 2013, the previous record.”
The article further explains that most experts attribute the rise in renunciations to a crackdown by US tax authorities on US citizens with foreign bank accounts. This crackdown has affected millions US expats — not just a few tycoons with offshore accounts — since the US taxes its citizens on worldwide income, and tax credits for income earned outside the US often don’t fully eliminate double taxation. Here’s the Journal again: “For decades, these laws [i.e., US tax laws dictating that a US resident’s worldwide income is subject to US taxes] were rarely enforced, but scrutiny of Americans abroad is intensifying because of the Foreign Account Tax Compliance Act, or FATCA, which Congress passed in 2010. The law’s main provisions … require foreign financial institutions to report income of their US customers to the Internal Revenue Service.”
For more information, read the Forbes article, “New Un-American Record: Renouncing US Citizenship.” It explains that “with global tax reporting and FATCA, the list of those who renounce keeps growing” and that “many now find America’s global income tax compliance and disclosure laws inconvenient, even oppressive.”
Global New Year’s Traditions
In Patti Smith’s excellent memoir Just Kids, she recalls an old saying of her mother’s, “that what you do on New Year’s Day will foretell what you’ll be doing the rest of the year.” While not verifiable, the statement has the ring of truth. (And I wish I’d heard it before my late 40s.) The Old Farmer’s Almanac — which bills itself as “North America’s most popular reference guide and oldest continuously published periodical” — has some similar lore on the “New Year Traditions from around the World” page of its website. Here are two examples: “On New Year’s Eve, kiss the person you hope to keep kissing” (easier said than done) and “For abundance in the new year, fill your pockets and cupboards today.”
The Almanac also mentions food-related New Year’s traditions, such as “eating 12 grapes at midnight [which] comes from Spain” and the practice of eating black-eyed peas and in the American south, which “foretells good fortune.”
For about two decades now, my wife has cooked a killer oyster stew on New Year's Day. This 2013 History.com article indicates that eating oyster stew around the holidays has a long tradition in the US. It became a staple on Christmas Eve among Irish-American settlers in the 19th century, when they substituted oysters for ling (a cod-like fish common in the North Atlantic) in their traditional recipes.
For a good photo essay, check out “New Year's Celebrations around the World,” which originally appeared in January 2015 on CNN.com. Most of the pictures involve fireworks displays over large cities, and the shot of Rome is particularly stunning. Perhaps most appealing, though, is the photo of a Cuban family in tee-shirts gathered around a whole pig roasting over a fire pit. That’s a New Year’s tradition I could get behind.