The Myth of Cheap

There is a popular saying that there is no free lunch. How true. In real life someone has to pay the price. Are countries like India and China really cheap? How come China produces its stuff so cheap?

Someone pays the price. The roadside foodstall is cheaper than the pucca shop 7 feet inside. Reason? The roadside stall pays an illegal rent (hafta?) which is fraction of the cost of the rent paid by a competitor housed in a legitimate piece of real-estate. The cost of transporting a truckload of sand in India is a fraction of its cost in the US. Why? Because the truck used is often very old, whose debt has been long repaid; it may not be road-fit but it can still go on and even spill some sand on the road. What about the counterpart in a developed country? He must invest heavily to keep a road-fit relatively new truck; employ safety tools to ensure that no sand spills on the road. Who pays the price for cheap sand transportation in India or similar countries? People do. The spilling sand destroys road surfaces worth crores of rupees, as moving vehicles keep rubbing the sand onto the road surface. Then goes a cycle of suffering and costs that people must endure for bad roads, including delay and larger fuel consumption.

Why it is cheap? Lands are doled out in subsidies. Especially in relation to China, I read reports of very cheap lands allocated to do business. Lack of safety regulations translating into no investments necessary for safety and health of public at large and workers more specifically. Similarly in relation to other regulations. For example, commercial production/activities in residential areas, thereby saving taxes and electricity tariff -- leaving the government and taxpayer short changed. The fault is also as much with us. We prefer all kinds of savings by evading regulations when it is related to self, but then hypocritically expect developed countries like safety norms, facilities and infrastructure.

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