BEIJING — The mother of China’s prime minister was a schoolteacher in northern China. His father was ordered to tend pigs in one of Mao’s political campaigns. And during childhood, “my family was extremely poor,” the prime minister, Wen Jiabao, said in a speech last year.
But now 90, the prime minister’s mother, Yang Zhiyun, not only left poverty behind, she became outright rich, at least on paper, according to corporate and regulatory records. Just one investment in her name, in a large Chinese financial services company, had a value of $120 million five years ago, the records show.
The details of how Ms. Yang, a widow, accumulated such wealth are not known, or even if she was aware of the holdings in her name. But it happened after her son was elevated to China’s ruling elite, first in 1998 as vice prime minister and then five years later as prime minister.
Many relatives of Wen Jiabao, including his son, daughter, younger brother and brother-in-law, have become extraordinarily wealthy during his leadership, an investigation by The New York Times shows. A review of corporate and regulatory records indicates that the prime minister’s relatives — some of whom, including his wife, have a knack for aggressive deal making — have controlled assets worth at least $2.7 billion.
In many cases, the names of the relatives have been hidden behind layers of partnerships and investment vehicles involving friends, work colleagues and business partners. Untangling their financial holdings provides an unusually detailed look at how politically connected people have profited from being at the intersection of government and business as state influence and private wealth converge in China’s fast-growing economy.
Unlike most new businesses in China, the family’s ventures sometimes received financial backing from state-owned companies, including China Mobile, one of the country’s biggest phone operators, the documents show. At other times, the ventures won support from some of Asia’s richest tycoons. The Times found that Mr. Wen’s relatives accumulated shares in banks, jewelers, tourist resorts, telecommunications companies and infrastructure projects, sometimes by using offshore entities.
The holdings include a villa development project in Beijing; a tire factory in northern China; a company that helped build some of Beijing’s Olympic stadiums, including the well-known “Bird’s Nest”; and Ping An Insurance, one of the world’s biggest financial services companies.
As prime minister in an economy that remains heavily state-driven, Mr. Wen, who is best known for his simple ways and common touch, more importantly has broad authority over the major industries where his relatives have made their fortunes. Chinese companies cannot list their shares on a stock exchange without approval from agencies overseen by Mr. Wen, for example. He also has the power to influence investments in strategic sectors like energy and telecommunications.
Because the Chinese government rarely makes its deliberations public, it is not known what role — if any — Mr. Wen, who is 70, has played in most policy or regulatory decisions. But in some cases, his relatives have sought to profit from opportunities made possible by those decisions.
The prime minister’s younger brother, for example, has a company that was awarded more than $30 million in government contracts and subsidies to handle wastewater treatment and medical waste disposal for some of China’s biggest cities, according to estimates based on government records. The contracts were announced after Mr. Wen ordered tougher regulations on medical waste disposal in 2003 after the SARS outbreak.
In 2004, after the State Council, a government body Mr. Wen presides over, exempted Ping An Insurance and other companies from rules that limited their scope, Ping An went on to raise $1.8 billion in an initial public offering of stock. Partnerships controlled by Mr. Wen’s relatives — along with their friends and colleagues — made a fortune by investing in the company before the public offering.
In 2007, the last year the stock holdings were disclosed in public documents, those partnerships held as much as $2.2 billion worth of Ping An stock, according to an accounting of the investments by The Times that was verified by outside auditors. Ping An’s overall market value is now nearly $60 billion.
Ping An said in a statement that the company did “not know the background of the entities behind our shareholders.” The statement said, “Ping An has no means to know the intentions behind shareholders when they buy and sell our shares.”
While Communist Party regulations call for top officials to disclose their wealth and that of their immediate family members, no law or regulation prohibits relatives of even the most senior officials from becoming deal-makers or major investors — a loophole that effectively allows them to trade on their family name. Some Chinese argue that permitting the families of Communist Party leaders to profit from the country’s long economic boom has been important to ensuring elite support for market-oriented reforms.
Even so, the business dealings of Mr. Wen’s relatives have sometimes been hidden in ways that suggest the relatives are eager to avoid public scrutiny, the records filed with Chinese regulatory authorities show. Their ownership stakes are often veiled by an intricate web of holdings as many as five steps removed from the operating companies, according to the review.
In the case of Mr. Wen’s mother, The Times calculated her stake in Ping An — valued at $120 million in 2007 — by examining public records and government-issued identity cards, and by following the ownership trail to three Chinese investment entities. The name recorded on his mother’s shares was Taihong, a holding company registered in Tianjin, the prime minister’s hometown.
The apparent efforts to conceal the wealth reflect the highly charged politics surrounding the country’s ruling elite, many of whom are also enormously wealthy but reluctant to draw attention to their riches. When
Bloomberg News reported in June that the extended family of Vice President Xi Jinping, set to become China’s next president, had amassed hundreds of millions of dollars in assets, the Chinese government blocked access inside the country to the Bloomberg Web site.
“In the senior leadership, there’s no family that doesn’t have these problems,” said a former government colleague of Wen Jiabao who has known him for more than 20 years and who spoke on the condition of anonymity. “His enemies are intentionally trying to smear him by letting this leak out.”
The Times presented its findings to the Chinese government for comment. The Foreign Ministry declined to respond to questions about the investments, the prime minister or his relatives. Members of Mr. Wen’s family also declined to comment or did not respond
to re
quests for comment.
Duan Weihong, a wealthy businesswoman whose company, Taihong, was the investment vehicle for the Ping An shares held by the prime minister’s mother and other relatives, said the investments were actually her own. Ms. Duan, who comes from the prime minister’s hometown and is a close friend of his wife, said ownership of the shares was listed in the names of Mr. Wen’s relatives in an effort to conceal the size of Ms. Duan’s own holdings.
“When I invested in Ping An I didn’t want to be written about,” Ms. Duan said, “so I had my relatives find some other people to hold these shares for me.”
But it was an “accident,” she said, that her company chose the relatives of the prime minister as the listed shareholders — a process that required registering their official ID numbers and obtaining their signatures. Until presented with the names of the investors by The Times, she said, she had no idea that they had selected the relatives of Wen Jiabao.
The review of the corporate and regulatory records, which covers 1992 to 2012, found no holdings in Mr. Wen’s name. And it was not possible to determine from the documents whether he recused himself from any decisions that might have affected his relatives’ holdings, or whether they received preferential treatment on investments.
For much of his tenure, Wen Jiabao has been at the center of rumors and conjecture about efforts by his relatives to profit from his position. Yet until the review by The Times, there has been no detailed accounting of the family’s riches.
His wife, Zhang Beili, is one of the country’s leading authorities on jewelry and gemstones and is an accomplished businesswoman in her own right. By managing state diamond companies that were later privatized, The Times found, she helped her relatives parlay their minority stakes into a billion-dollar portfolio of insurance, technology and real estate ventures.
The couple’s only son sold a technology company he started to the family of Hong Kong’s richest man, Li Ka-shing, for $10 million, and used another investment vehicle to establish New Horizon Capital, now one of China’s biggest private equity firms, with partners like the government of Singapore, according to records and interviews with bankers.
The prime minister’s younger brother, Wen Jiahong, controls $200 million in assets, including wastewater treatment plants and recycling businesses, the records show.
As prime minister, Mr. Wen has staked out a position as a populist and a reformer, someone whom the state-run media has nicknamed “the People’s Premier” and “Grandpa Wen” because of his frequent outings to meet ordinary people, especially in moments of crisis like natural disasters.
While it is unclear how much the prime minister knows about his family’s wealth, State Department documents released by the WikiLeaks organization in 2010 included a cable that suggested Mr. Wen was aware of his relatives’ business dealings and unhappy about them.
“Wen is disgusted with his family’s activities, but is either unable or unwilling to curtail them,” a Chinese-born executive working at an American company in Shanghai told American diplomats, according to the 2007 cable.
China’s ‘Diamond Queen’It is no secret in China’s elite circles that the prime minister’s wife, Zhang Beili, is rich, and that she has helped control the nation’s jewelry and gem trade. But her lucrative diamond businesses became an off-the-charts success only as her husband moved into the country’s top leadership ranks, the review of corporate and regulatory records by The Times found.
A geologist with an expertise in gemstones, Ms. Zhang is largely unknown among ordinary Chinese. She rarely travels with the prime minister or appears with him, and there are few official photographs of the couple together. And while people who have worked with her say she has a taste for jade and fine diamonds, they say she usually dresses modestly, does not exude glamour and prefers to wield influence behind the scenes, much like the relatives of other senior leaders.
The State Department documents released by WikiLeaks included a suggestion that Mr. Wen had once considered divorcing Ms. Zhang because she had exploited their relationship in her diamond trades. Taiwanese television reported in 2007 that Ms. Zhang had bought a pair of jade earrings worth about $275,000 at a Beijing trade show, though the source — a Taiwanese trader — later backed off the claim and Chinese government censors moved swiftly to block coverage of the subject in China, according to news reports at the time.
“Her business activities are known to everyone in the leadership,” said one banker who worked with relatives of Wen Jiabao. The banker said it was not unusual for her office to call upon businesspeople. “And if you get that call, how can you say no?”
Zhang Beili first gained influence in the 1990s, while working as a regulator at the Ministry of Geology. At the time, China’s jewelry market was still in its infancy.
While her husband was serving in China’s main leadership compound, known as Zhongnanhai, Ms. Zhang was setting industry standards in the jewelry and gem trade. She helped create the National Gemstone Testing Center in Beijing, and the Shanghai Diamond Exchange, two of the industry’s most powerful institutions.
In a country where the state has long dominated the marketplace, jewelry regulators often decided which companies could set up diamond-processing factories, and which would gain entry to the retail jewelry market. State regulators even formulated rules that required diamond sellers to buy certificates of authenticity for any diamond sold in China, from the government-run testing center in Beijing, which Ms. Zhang managed.
As a result, when executives from Cartier or De Beers visited China with hopes of selling diamonds and jewelry here, they often went to visit Ms. Zhang, who became known as China’s “diamond queen.”
“She’s the most important person there,” said Gaetano Cavalieri, president of the World Jewelry Confederation in Switzerland. “She was bridging relations between partners — Chinese and foreign partners.”
As early as 1992, people who worked with Ms. Zhang said, she had begun to blur the line between government official and businesswoman. As head of the state-owned China Mineral and Gem Corporation, she began investing the state company’s money in start-ups. And by the time her husband was named vice premier, in 1998, she was busy setting up business ventures with friends and relatives.
The state company she ran invested in a group of affiliated diamond companies, according to public records. Many of them were run by Ms. Zhang’s relatives — or colleagues who had worked with her at the National Gemstone Testing Center.
In 1993, for instance, the state company Ms. Zhang ran helped found Beijing Diamond, a big jewelry retailer. A year later, one of her younger brothers, Zhang Jianming, and two of her government colleagues personally acquired 80 percent of the company, according to shareholder registers. Beijing Diamond invested in Shenzhen Diamond, which was controlled by her brother-in-law, Wen Jiahong, the prime minister’s younger brother.
Among the successful undertakings was Sino-Diamond, a venture financed by the state-owned China Mineral and Gem Corporation, which she headed. The company had business ties with a state-owned company managed by another brother, Zhang Jiankun, who worked as an official in Jiaxing,
Ms. Zhang’s hometown, in Zhejiang Province.
In the summer of 1999, after securing agreements to import diamonds from Russia and South Africa, Sino-Diamond went public, raising $50 million on the Shanghai Stock Exchange. The offering netted Ms. Zhang’s family about $8 million, according to corporate filings.
Although she was never listed as a shareholder, former colleagues and business partners say Ms. Zhang’s early diamond partnerships were the nucleus of a larger portfolio of companies she would later help her family and colleagues gain a stake in.
The Times found no indication that Wen Jiabao used his political clout to influence the diamond companies his relatives invested in. But former business partners said that the family’s success in diamonds, and beyond, was often bolstered with financial backing from wealthy businessmen who sought to curry favor with the prime minister’s family.
“After Wen became prime minister, his wife sold off some of her diamond investments and moved into new things,” said a Chinese executive who did business with the family. He asked not to be named because of fear of government retaliation. Corporate records show that beginning in the late 1990s, a series of rich businessmen took turns buying up large stakes in the diamond companies, often from relatives of Mr. Wen, and then helped them reinvest in other lucrative ventures, like real estate and finance.
According to corporate records and interviews, the businessmen often supplied accountants and office space to investment partnerships partly controlled by the relatives.
“When they formed companies,” said one businessman who set up a company with members of the Wen family, “Ms. Zhang stayed in the background. That’s how it worked.”
The Only SonLate one evening early this year, the prime minister’s only son, Wen Yunsong, was in the cigar lounge at Xiu, an upscale bar and lounge at the Park Hyatt in Beijing. He was having cocktails as Beijing’s nouveau riche gathered around, clutching designer bags and wearing expensive business suits, according to two guests who were present.
In China, the children of senior leaders are widely believed to be in a class of their own. Known as “princelings,” they often hold Ivy League degrees, get V.I.P. treatment, and are even offered preferred pricing on shares in hot stock offerings.
They are also known as people who can get things done in China’s heavily regulated marketplace, where the state controls access. And in recent years, few princelings have been as bold as the younger Mr. Wen, who goes by the English name Winston and is about 40 years old.
A Times review of Winston Wen’s investments, and interviews with people who have known him for years, show that his deal-making has been extensive and lucrative, even by the standards of his princeling peers.
State-run giants like China Mobile have formed start-ups with him. In recent years, Winston Wen has been in talks with Hollywood studios about a financing deal.
Concerned that China does not have an elite boarding school for Chinese students, he recently hired the headmasters of Choate and Hotchkiss in Connecticut to oversee the creation of a $150 million private school now being built in the Beijing suburbs.
Winston Wen and his wife, moreover, have stakes in the technology industry and an electric company, as well as an indirect stake in Union Mobile Pay, the government-backed online payment platform — all while living in the prime minister’s residence, in central Beijing, according to corporate records and people familiar with the family’s investments.
“He’s not shy about using his influence to get things done,” said one venture capitalist who regularly meets with Winston Wen.
The younger Mr. Wen declined to comment. But in a telephone interview, his wife, Yang Xiaomeng, said her husband had been unfairly criticized for his business dealings.
“Everything that has been written about him has been wrong,” she said. “He’s really not doing that much business anymore.”
Winston Wen was educated in Beijing and then earned an engineering degree from the Beijing Institute of Technology. He went abroad and earned a master’s degree in engineering materials from the University of Windsor, in Canada, and an M.B.A. from the Kellogg School of Business at Northwestern University in Evanston, Ill., just outside Chicago.
When he returned to China in 2000, he helped set up three successful technology companies in five years, according to people familiar with those deals. Two of them were sold to Hong Kong businessmen, one to the family of Li Ka-shing, one of the wealthiest men in Asia.
Winston Wen’s earliest venture, an Internet data services provider called Unihub Global, was founded in 2000 with $2 million in start-up capital, according to Hong Kong and Beijing corporate filings. Financing came from a tight-knit group of relatives and his mother’s former colleagues from government and the diamond trade, as well as an associate of Cheng Yu-tung, patriarch of Hong Kong’s second-wealthiest family. The firm’s earliest customers were state-owned brokerage houses and Ping An, in which the Wen family has held a large financial stake.
He made an even bolder move in 2005, by pushing into private equity when he formed New Horizon Capital with a group of Chinese-born classmates from Northwestern. The firm quickly raised $100 million from investors, including SBI Holdings, a division of the Japanese group SoftBank, and Temasek, the Singapore government investment fund.
Under Mr. Wen, New Horizon established itself as a leading private equity firm, investing in biotech, solar, wind and construction equipment makers. Since it began operations, the firm has returned about $430 million to investors, a fourfold profit, according to SBI Holdings.
“Their first fund was dynamite,” said Kathleen Ng, editor of Asia Private Equity Review, an industry publication in Hong Kong. “And that allowed them to raise a lot more money.”
Today, New Horizon has more than $2.5 billion under management.
Some of Winston Wen’s deal-making, though, has attracted unwanted attention for the prime minister.
In 2010, when New Horizon acquired a 9 percent stake in a company called Sihuan Pharmaceuticals just two months before its public offering, the Hong Kong Stock Exchange said the late-stage investment violated its rules and forced the firm to return the stake. Still, New Horizon made a $46.5 million profit on the sale.
Soon after, New Horizon announced that Winston Wen had handed over day-to-day operations and taken up a position at the China Satellite Communications Corporation, a state-owned company that has ties to the Chinese space program. He has since been named chairman.
The TycoonsIn the late 1990s, Duan Weihong was managing an office building and several other properties in Tianjin, the prime minister’s hometown in northern China, through her property company, Taihong. She was in her 20s and had studied at the Nanjing University of Science and Technology.
Around 2002, Ms. Duan went into business with several relatives of Wen Jiabao, transforming her property company into an investment vehicle of the same name. The company helped make Ms. Duan very wealthy.
It is not known whether Ms. Duan, now 43, is related to the prime minister. In a series of interviews, she first said she did not know any members of t
he Wen family, but later described herself as a friend of the family and particularly close to Zhang Beili, the prime minister’s wife. As happened to a handful of other Chinese entrepreneurs, Ms. Duan’s fortunes soared as she teamed up with the relatives and their network of friends and colleagues, though she described her relationship with them involving the shares in Ping An as existing on paper only and having no financial component.
Ms. Duan and other wealthy businesspeople — among them, six billionaires from across China — have been instrumental in getting multimillion-dollar ventures off the ground and, at crucial times, helping members of the Wen family set up investment vehicles to profit from them, according to investment bankers who have worked with all parties.
Established in Tianjin, Taihong had spectacular returns. In 2002, the company paid about $65 million to acquire a 3 percent stake in Ping An before its initial public offering, according to corporate records and Ms. Duan’s graduate school thesis. Five years later, those shares were worth $3.7 billion
The company’s Hong Kong affiliate, Great Ocean, also run by Ms. Duan, later formed a joint venture with the Beijing government and acquired a huge tract of land adjacent to Capital International Airport. Today, the site is home to a sprawling cargo and logistics center. Last year, Great Ocean sold its 53 percent stake in the project to a Singapore company for nearly $400 million.
That deal and several other investments, in luxury hotels, Beijing villa developments and the Hong Kong-listed BBMG, one of China’s largest building materials companies, have been instrumental to Ms. Duan’s accumulation of riches, according to The Times’s review of corporate records.
The review also showed that over the past decade there have been nearly three dozen individual shareholders of Taihong, many of whom are either relatives of Wen Jiabao or former colleagues of his wife.
The other wealthy entrepreneurs who have worked with the prime minister’s relatives declined to comment for this article. Ms. Duan strongly denied having financial ties to the prime minister or his relatives and said she was only trying to avoid publicity by listing others as owning Ping An shares. “The money I invested in Ping An was completely my own,” said Ms. Duan, who has served as a member of the Ping An board of supervisors. “Everything I did was legal.”
Another wealthy partner of the Wen relatives has been Cheng Yu-tung, who controls the Hong Kong conglomerate New World Development and is one of the richest men in Asia, worth about $15 billion, according to Forbes.
In the 1990s, New World was seeking a foothold in mainland China for a sister company that specializes in high-end retail jewelry. The retail chain, Chow Tai Fook, opened its first store in China in 1998.
Mr. Cheng and his associates invested in a diamond venture backed by the relatives of Mr. Wen and co-invested with them in an array of corporate entities, including Sino-Life, National Trust and Ping An, according to records and interviews with some of those involved. Those investments by Mr. Cheng are now worth at least $5 billion, according to the corporate filings. Chow Tai Fook, the jewelry chain, has also flourished. Today, China accounts for 60 percent of the chain’s $4.2 billion in annual revenue.
Mr. Cheng, 87, could not be reached for comment. Calls to New World Development were not returned.
Fallout for Premier
In the winter of 2007, just before he began his second term as prime minister, Wen Jiabao called for new measures to fight corruption, particularly among high-ranking officials.
“Leaders at all levels of government should take the lead in the antigraft drive,” he told a gathering of high-level party members in Beijing. “They should strictly ensure that their family members, friends and close subordinates do not abuse government influence.”
The speech was consistent with the prime minister’s earlier drive to toughen disclosure rules for public servants, and to require senior officials to reveal their family assets.
Whether Mr. Wen has made such disclosures for his own family is unclear, since the Communist Party does not release such information. Even so, many of the holdings found by The Times would not need to be disclosed under the rules since they are not held in the name of the prime minister’s immediate family — his wife, son and daughter.
Eighty percent of the $2.7 billion in assets identified in The Times’s investigation and verified by the outside auditors were held by, among others, the prime minister’s mother, his younger brother, two brothers-in-law, a sister-in-law, daughter-in-law and the parents of his son’s wife, none of whom is subject to party disclosure rules. The total value of the relatives’ stake in Ping An is based on calculations by The Times that were confirmed by the auditors. The total includes shares held by the relatives that were sold between 2004 and 2006, and the value of the remaining shares in late 2007, the last time the holdings were publicly disclosed.
Legal experts said that determining the precise value of holdings in China could be difficult because there might be undisclosed side agreements about the true beneficiaries.
“Complex corporate structures are not necessarily insidious,” said Curtis J. Milhaupt, a Columbia University Law School professor who has studied China’s corporate group structures. “But in a system like China’s, where corporate ownership and political power are closely intertwined, shell companies magnify questions about who owns what and where the money came from.”
Among the investors in the Wen family ventures are longtime business associates, former colleagues and college classmates, including Yu Jianming, who attended Northwestern with Winston Wen, and Zhang Yuhong, a longtime colleague of Wen Jiahong, the prime minister’s younger brother. The associates did not return telephone calls seeking comment.
Revelations about the Wen family’s wealth could weaken him politically.
Next month, at the 18th Party Congress in Beijing, the Communist Party is expected to announce a new generation of leaders. But the selection process has already been marred by one of the worst political scandals in decades, the downfall of Bo Xilai, the Chongqing party boss, who was vying for a top position.
In Beijing, Wen Jiabao is expected to step down as prime minister in March at the end of his second term. Political analysts say that even after leaving office he could remain a strong backstage political force. But documents showing that his relatives amassed a fortune during his tenure could diminish his standing, the analysts said.
“This will affect whatever residual power Wen has,” said Minxin Pei, an expert on Chinese leadership and a professor of government at Claremont McKenna College in California.
The prime minister’s supporters say he has not personally benefited from his extended family’s business dealings, and may not even be knowledgeable about the extent of them.
Last March, the prime minister hinted that he was at least aware of the persistent rumors about his relatives. During a nationally televised news conference in Beijing, he insisted that he had “never pursued personal gain” in public office.
“I have the courage to face the people and to face history,” he said in an emotional session. “There are people who will appreciate what I have done, but there are also people who will criticize me. Ulti
mately, history will have the final say.”
Made in America Markets Create Communities of Like-Minded Consumers
UncategorizedNovember 5, 2012
They arrived in town late Friday night and were among the first to show up on a recent crisp October morning at a warehouse in Chicago’s Fulton Market area. Music by Band of Horses played softly in the background, giving the airy, white-washed loft space an ambiance equal parts gallery opening and trade show. A large vintage American flag looming over the showroom signaled the common domestic origin of the clothing, accessories, shoes, bicycles and skin care products for sale.
Adachi and Kennedy were already fans of some of the brands at NorthernGRADE, a pop-up menswear market of American-made goods making its Chicago debut two years after launching in Minnesota. Meeting the crafters, designers and small-business owners behind the brands added to the appeal, they said.
“I like the idea of craftsmanship. I feel like the brands are doing it because they care and there’s something about that that’s very commendable. I’d rather support that than go to the mall and buy something made overseas,” said Adachi, 25.
“We had to come, especially since events like this don’t happen much in the Midwest,” said Kennedy, a 23-year-old self-described “made in America freak” who was turned onto the concept by her boyfriend. “It’s so awesome to see people doing what they love. It’s evident in the quality of their products.”
About 800 people turned up for NorthernGRADE Chicago, according to organizers’ estimates, from across the Midwest and beyond, underscoring the growing popularity of the made in America movement in style and fashion, especially among younger consumers.
The markets are fueling the movement beyond the country’s major fashion markets, where the concept has proven successful. NorthernGRADE is modeled after New York City’s annual Pop-Up Flea, which began in 2009 as a showcase of brands mostly from the United States known for their quality goods. The creators of NorthernGRADE adopted the model for a Midwestern audience by focusing on brands from region. But the focus on quality brands hasn’t changed, said Katherine McMillan of men’s accessory line Pierrepont Hicks, which co-founded NorthernGRADE.
“I would not feel comfortable producing this market if I didn’t believe in all of the brands we invite to take part,” she said. “We all have similar philosophies and ethics about our products. If someone’s products don’t turn out to meet (our standards), we don’t invite them back.”
“The Midwest has long history of manufacturing, but no one was cheering it on until now,” said fashion and brand consultant Noah Zagor, who showed up at the market dressed the part in a vintage denim Levi’s jacket and Alden “Indy” boots, both of which were made in the United States.
“There’s a new generation of men learning about basics of getting dressed, and they want knowledge. They want to know where their stuff comes from.”
It’s tempting to want to stereotype supporters of American-made apparel as either a bunch of trendy urbanites who want to look like lumberjacks on the weekend or blue-collar workers expressing patriotism through their work boots. But this event brought in visitors of all stripes. Teenagers dragged their parents along for their wallets while middle-aged men scanned the displays for unadorned pairs of jeans and silver-haired couples, who remembered the days when manufacturing plants dotted the Midwest, tried on trapper hats.
One thing they all seemed to share was nostalgia for an era when clothing and accessories were made to last, regardless of whether they were actually alive during that time.
One man came from London in search of “a few bits of inspiration” for a potential American-made and UK-made retail concept in England, which is also experiencing a wave of nostalgia for a time when clothing was made closer to home.
“People like me want to stray from goods made in the Far East,” said David Swetman, a 27-year-old freelance designer who resembled a menswear model in a Barbour jacket and fisherman’s sweater over a flannel shirt, JW Hulme duffel bag slung over his shoulder.
“We’re swinging away from fast fashion, and we’re willing to invest and spend more on quality,” he said. Sure enough, he left the market about an hour later with a $300 Archival waxed cotton vest, a $195 shawl-collared Pendleton sweater and leather shoelaces of different colors. “A nice way to accessorize your brogues,” he noted.
For anyone who might use the words “classic,” “structured,” “Americana” or “heritage” to describe their personal style, there was plenty to covet: colorful racks of Oxford cloth button-ups, thick shawl-collared sweaters, jeans from some of the hottest names in premium denim and all manner of vintage.
Footwear fanatics had their choice of leather boots and shoes in every imaginable color and texture from Red Wing and Oak Street, two boot makers representing old and new school establishments. Tables displayed unisex accessories, from sturdy canvas rucksacks, shoulder bags and pencil cases to wool trapper hats and candy-colored assortments of neckties, bow ties and blankets.
Like other market-goers, Adachi was dressed as though his outfit had come from the showroom: Red Wing Heritage boots (made in America), Raleigh Denim jeans (naturally), flannel shirt (no) and Hill-Side scarf (yes) over a henley (no).
Kennedy also looked the part in dark jeans, vintage pullover sweater and boots, though none of it was made in America, underscoring arguments that clothing made in America can be prohibitively expensive or hard to find.
What would make her wardrobe more patriotic, so to speak? “More shows like this would help,” she said. “It’s hard to find this stuff in person.”
13;
Radio host Glenn Beck last month announced his line of American-made jeans, which gets its denim from the same North Carolina mill used by many premium jean brands. Made Collection, an online flash site sale, launched this fall offering American-made products at discounted prices. In time for the holiday season, luxury and mass market retailers such as Anthropologie, Urban Outfitters and Barneys are continuing the trend of partnering with independent brands and designers who make their products in America.
It’s also been a busy year for pop-up markets. The Chicago show marked NorthernGRADE’s first incursion into another city, two years after it was started by Pierrepont Hicks and J.W. Hulme. Another show is scheduled for Minneapolis in December, which will be its third there this year. In 2013, it plans to expand to San Francisco, Nashville, Denver and Moscow.
Another pop-up, American Field, debuted in Boston the weekend before NorthernGRADE Chicago and featured 40 vendors, organizer Mark Bollman said.
“It’s one thing to read about companies making things in the U.S. or to check a label, but I think it’s a whole other thing to have a physical representation of like-minded companies in one place,” said Bollman, founder of Boston-based outfitter Ball and Buck. “You can directly see and understand the growth of this movement and really understand the impact of a purchase, be it big or small.”
The markets featured a combination of businesses that use American factories and workshops to produce their goods along with artisans and crafters who, by virtue of living in the United States, make their product here. Across all categories, the raw materials may or may not be domestically sourced depending on availability, with hardware such as zippers, snaps and woven fabric among the materials in shortest supply in the United States.
The growing hype has some worried that “made in America” is on the precipice of becoming a passing style trend before it actually has a chance to realize its oft-cited underlying goals.
“The initial made in the USA message was about bringing jobs back to the country to stimulate the economy, ending the dependency on other countries for goods and bringing back the education and know-how that comes along with the industry. All that’s being diluted and boiled down into the message of buy made in the USA. The bottom has been taken out and become a selling point,” said Chicago-based menswear blogger and digital strategist Brad Bennett, who helped coordinate NorthernGRADE.
It’s unclear whether interest in American-made clothing correlates with an increase in industrial domestic manufacturing of clothing, which declined by 0.7% from September 2011 to September 2012, according to the Federal Reserve’s numbers on industrial production. However, preliminary numbers for September showed a 1.6% increase over the previous month.
That’s where the markets come into play, to create a movement by bringing together consumers, brands and retailers who are doing their part to raise the profile of American-made fashion.
“It’s definitely a celebration of things made here but also a celebration of the people making it,” said Bennett, whose blog, Well Spent, features “obtainable, honestly crafted goods” from the United States and abroad.
“It’s a pretty cool thing to pick up a bag knowing it’s going to last the rest of your life and then shake the hand of the person who made it,” he said. “You’re not just coming to NorthernGRADE to spend money, you meet people and it’s sort of like, here’s your community.”
A big part of selling made in America is educating the consumer on what they get from their investment, said Lesli Larson, co-founder of Archival Clothing, whose best-selling roll top backpack goes for $220.
“You pay upfront, but you buy sparingly and wisely with the idea that you’re going to use this piece for many seasons and eventually you get pennies per wear,” she said.
Her business grew out of her blog, which documented “long-lost artifacts” from Montgomery Ward catalogs and Americana-inspired fashion being produced in Japan with old machines and equipment purchased from the United States.
“The shift of moving past a state of nostalgia to what can we do to make this a reality using available resources has been the challenge,” said Larson, who has kept her job as an archivist at the University of Oregon-Eugene even as her business has grown.
Larson relishes the opportunity to share her knowledge, which she did with fans including Adachi, who spent more than three hours floating around the showroom before deciding to drop $300 on an Archival vest. His girlfriend’s big-ticket purchase was a pair of Tellason jeans for $198. They were confident that the purchases were worth the money, not only for their quality but because of the stories behind them.
It reminded Adachi of a TED Talk by Simon Sinek who put forth the idea that people don’t buy what you do, they buy why you do it.
“I’m the type of person who’s more interested in why,” Adachi said.
For others, though, the origin of the goods was not nearly as important as their quality.
“I came to the event for the uniqueness of the collections,” said Jeff Medchill, a mortgage industry auditor who also picked up a pair of Tellason jeans. “American-made is not a strong point, I wouldn’t go out of my way to avoid or buy American-made.”
Collin Moody said he was drawn to the event because he supported Chicago-based retailers Haberdash and Penelope’s, which were showing at the market. Normally, not everything they carry in their stores is domestically made, reflecting a commonly held position among consumers and stockists that buying made in America is secondary to sourcing high-quality products made responsibly regardless of their origin.
“We’re interested in
the
ethics of the products. We try to be conscious of where they come from and who’s making them,” said Moody, 21, also a student. “It also helps us not be wasteful.”
For retired carpenter Paul Hortenstine, the market was simply an opportunity “to find quality products made in the USA.”
He and his wife made the trip from Shorewood, Illinois, after learning of the event on Twitter. He had his sights set on a Stormy Kromer trapper hat, but stopped on his way over to quiz George Vlagos, proprietor of Oak Street Boots, on the origin of material for his footwear (Horween Leather of Chicago).
“This guy from Oak Street Bootmakers, he’s making quality product. I’m all for seeing people succeed making quality products in the U.S.,” Hortenstine happily exclaimed as he walked away without purchasing a pair, which run from $200 to $500.
“The price is high but quality justifies it,” he said. “Maybe you can buy it all or you can focus on one or two things.”
He finally settled on two hats in different colors from Stormy Kromer, which have been made in Ironwood, Michigan, for more than 100 years. He also picked up a vest, a recent addition to Stormy Kromer’s apparel catalog, reflecting the success of what sales rep Joel Anderson called “the Trojan horse approach.”
“They come for the hats, because that’s what we’re known for, and they find our apparel,” said Anderson, whose brand was one of few at NorthernGRADE that fell into the heritage category (along with Red Wing) for its long history. While Stormy Kromer is an established brand, being in the same space alongside up-and-coming brands puts it in front of a new, younger audience of consumers and potential wholesalers.
“It’s a three-pronged approach. Educate consumers on our rich history and story, meet fellow vendors, and get new retail business,” he said. “You never know who’s going to come in.”
What Is ‘Made in America’ Worth?
American Made, Domestic Sourcing, Economy, Made in USA, Manufacturing & SourcingRead more
It's Global Warming, Stupid
UncategorizedNovember 01, 2012
Clarity, however, is not beyond reach. Hurricane Sandy demands it: At least 40 U.S. deaths. Economic losses expected to climb as high as $50 billion. Eight million homes without power. Hundreds of thousands of people evacuated. More than 15,000 flights grounded. Factories, stores, and hospitals shut. Lower Manhattan dark, silent, and underwater.
In an Oct. 30 blog post, Mark Fischetti of Scientific American took a spin through Ph.D.-land and found more and more credentialed experts willing to shrug off the climate caveats. The broadening consensus: “Climate change amps up other basic factors that contribute to big storms. For example, the oceans have warmed, providing more energy for storms. And the Earth’s atmosphere has warmed, so it retains more moisture, which is drawn into storms and is then dumped on us.” Even those of us who are science-phobic can get the gist of that.
Sandy featured a scary extra twist implicating climate change. An Atlantic hurricane moving up the East Coast crashed into cold air dipping south from Canada. The collision supercharged the storm’s energy level and extended its geographical reach. Pushing that cold air south was an atmospheric pattern, known as a blocking high, above the Arctic Ocean. Climate scientists Charles Greene and Bruce Monger of Cornell University, writing earlier this year in Oceanography, provided evidence that Arctic icemelts linked to global warming contribute to the very atmospheric pattern that sent the frigid burst down across Canada and the eastern U.S.
If all that doesn’t impress, forget the scientists ostensibly devoted to advancing knowledge and saving lives. Listen instead to corporate insurers committed to compiling statistics for profit.
On Oct. 17 the giant German reinsurance company Munich Re issued a prescient report titled Severe Weather in North America. Globally, the rate of extreme weather events is rising, and “nowhere in the world is the rising number of natural catastrophes more evident than in North America.” From 1980 through 2011, weather disasters caused losses totaling $1.06 trillion. Munich Re found “a nearly quintupled number of weather-related loss events in North America for the past three decades.” By contrast, there was “an increase factor of 4 in Asia, 2.5 in Africa, 2 in Europe, and 1.5 in South America.” Human-caused climate change “is believed to contribute to this trend,” the report said, “though it influences various perils in different ways.”
Global warming “particularly affects formation of heat waves, droughts, intense precipitation events, and in the long run most probably also tropical cyclone intensity,” Munich Re said. This July was the hottest month recorded in the U.S. since record-keeping began in 1895, according to the National Oceanic and Atmospheric Administration. The U.S. Drought Monitor reported that two-thirds of the continental U.S. suffered drought conditions this summer.
Granted, Munich Re wants to sell more reinsurance (backup policies purchased by other insurance companies), so maybe it has a selfish reason to stir anxiety. But it has no obvious motive for fingering global warming vs. other causes. “If the first effects of climate change are already perceptible,” said Peter Hoppe, the company’s chief of geo-risks research, “all alerts and measures against it have become even more pressing.”
Which raises the question of what alerts and measures to undertake. In his book The Conundrum, David Owen, a staff writer at the New Yorker, contends that as long as the West places high and unquestioning value on economic growth and consumer gratification—with China and the rest of the developing world right behind—we will continue to burn the fossil fuels whose emissions trap heat in the atmosphere. Fast trains, hybrid cars, compact fluorescent light bulbs, carbon offsets—they’re just not enough, Owen writes.
Yet even he would surely agree that the only responsible first step is to put climate change back on the table for discussion. The issue was MIA during the presidential debates and, regardless of who wins on Nov. 6, is unlikely to appear on the near-term congressional calendar. After Sandy, that seems insane.
Mitt Romney has gone from being a supporter years ago of clean energy and emission caps to, more recently, a climate agnostic. On Aug. 30, he belittled his opponent’s vow to arrest climate change, made during the 2008 presidential campaign. “President Obama promised to begin to slow the rise of the oceans and heal the planet,” Romney told the Republican National Convention in storm-tossed Tampa. “My promise is to help you and your family.” Two months later, in the wake of Sandy, submerged families in New Jersey and New York urgently needed some help dealing with that rising-ocean stuff.
Obama and his strategists clearly decided that in a tight race during fragile economic times, he should compete with Romney by promising to mine more coal and drill more oil. On the campaign trail, when Obama refers to the environment, he does so only in the context of spurring “green jobs.” During his time in office, Obama has made modest progress on climate issues. His administration’s fuel-efficiency standards will reduce by half the amount of greenhouse gas emissions from new cars and trucks by 2025. His regulations and proposed rules to curb mercury, carbon, and other emissions from coal-fired power plants are forcing utilities to retire some of the dirtiest old facilities. And the country has doubled the generation of energy from renewable sources such as solar and wind.
Still, renewable energy accounts for less than 15 percent of the country’s electricity. The U.S. cannot shake its fossil fuel addiction by going cold turkey. Offices and factories can’t function in the dark. Shippers and drivers and air trave
lers w
ill not abandon petroleum overnight. While scientists and entrepreneurs search for breakthrough technologies, the next president should push an energy plan that exploits plentiful domestic natural gas supplies. Burned for power, gas emits about half as much carbon as coal. That’s a trade-off already under way, and it’s worth expanding. Environmentalists taking a hard no-gas line are making a mistake.
Conservatives champion market forces—as do smart liberals—and financial incentives should be part of the climate agenda. In 2009 the House of Representatives passed cap-and-trade legislation that would have rewarded more nimble industrial players that figure out how to use cleaner energy. The bill died in the Senate in 2010, a victim of Tea Party-inspired Republican obstructionism and Obama’s decision to spend his political capital to push health-care reform.
Despite Republican fanaticism about all forms of government intervention in the economy, the idea of pricing carbon must remain a part of the national debate. One politically plausible way to tax carbon emissions is to transfer the revenue to individuals. Alaska, which pays dividends to its citizens from royalties imposed on oil companies, could provide inspiration (just as Romneycare in Massachusetts pointed the way to Obamacare).
Ultimately, the global warming crisis will require global solutions. Washington can become a credible advocate for moving the Chinese and Indian economies away from coal and toward alternatives only if the U.S. takes concerted political action. At the last United Nations conference on climate change in Durban, South Africa, the world’s governments agreed to seek a new legal agreement that binds signatories to reduce their carbon emissions. Negotiators agreed to come up with a new treaty by 2015, to be put in place by 2020. To work, the treaty will need to include a way to penalize countries that don’t meet emission-reduction targets—something the U.S. has until now refused to support.
If Hurricane Sandy does nothing else, it should suggest that we need to commit more to disaster preparation and response. As with climate change, Romney has displayed an alarmingly cavalier attitude on weather emergencies. During one Republican primary debate last year, he was asked point-blank whether the functions of the Federal Emergency Management Agency ought to be turned back to the states. “Absolutely,” he replied. Let the states fend for themselves or, better yet, put the private sector in charge. Pay-as-you-go rooftop rescue service may appeal to plutocrats; when the flood waters are rising, ordinary folks welcome the National Guard.
It’s possible Romney’s kill-FEMA remark was merely a pander to the Right, rather than a serious policy proposal. Still, the reconfirmed need for strong federal disaster capability—FEMA and Obama got glowing reviews from New Jersey Governor Chris Christie, a Romney supporter—makes the Republican presidential candidate’s campaign-trail statement all the more reprehensible.
The U.S. has allowed transportation and other infrastructure to grow obsolete and deteriorate, which poses a threat not just to public safety but also to the nation’s economic health. With once-in-a-century floods now occurring every few years, New York Governor Andrew Cuomo and New York City Mayor Michael Bloomberg said the country’s biggest city will need to consider building surge protectors and somehow waterproofing its enormous subway system. “It’s not prudent to sit here and say it’s not going to happen again,” Cuomo said. “I believe it is going to happen again.”
David Rothkopf, the chief executive and editor-at-large ofForeign Policy, noted in an Oct. 29 blog post that Sandy also brought his hometown, Washington, to a standstill, impeding affairs of state. To lessen future impact, he suggested burying urban and suburban power lines, an expensive but sensible improvement.
Where to get the money? Rothkopf proposed shifting funds from post-Sept. 11 bureaucratic leviathans such as the Department of Homeland Security, which he alleges is shot through with waste. In truth, what’s lacking in America’s approach to climate change is not the resources to act but the political will to do so. A Pew Research Center poll conducted in October found that two-thirds of Americans say there is “solid evidence” the earth is getting warmer. That’s down 10 points since 2006. Among Republicans, more than half say it’s either not a serious problem or not a problem at all.
Such numbers reflect the success of climate deniers in framing action on global warming as inimical to economic growth. This is both shortsighted and dangerous. The U.S. can’t afford regular Sandy-size disruptions in economic activity. To limit the costs of climate-related disasters, both politicians and the public need to accept how much they’re helping to cause them.
THIS CHRISTMAS: WILL YOU SUPPORT AMERICAN OR FOREIGN WORKERS?
UncategorizedOctober 27, 2012
NewsWithViews.com
Well, retailers have the Christmas tree displays out for a couple of weeks now, gradually squeezing out Halloween junk. People are commenting, “I don’t even want to think about it” or “I just hate this time of the year”. I thought Christmas was supposed to be so special with all the family, warm and fuzzy? Presents, Old Saint Nick and new credit card bills go into high gear the day after Thanksgiving.
With 25 million Americans out of work, this “holiday” season is likely to be one of more pressure put on parents to buy children birthday presents even though it’s supposed to be the birth date of Jesus Christ.
No question according to polls – jobs are the number one issue this election cycle because folks are desperate. Just like Americans were during the “Great” Depression.
Since the crooks, liars and thieves in the Outlaw Congress (likely at least 80% or more will get reelected) refuse to get the U.S. out of all the job killing treaties (NAFTA, CAFTA, GATT/WTO and a dozen more passed since 1994), it’s up to we the people to continue forcing the issue by refusing to buy foreign junk keeping people in other countries employed while Americans stand in soup lines, live in their cars or collect unemployment insurance for years.
One of the carrots used to sell the American people for NAFTA was “cheaper” goods. They sure are – cheap in quality, but not in dollars. Go to Dillard’s, Macy’s or other department stores and look at the price tag on some rag or shoes made in Communist China. It is as high or higher than a similar one made in America. I know because I do price comparisons as research. Of course, the purchasing power of the dollar continues to take a beating, so that worthless piece of paper in your wallet doesn’t go as far. Tens of millions of Americans have no idea what that means anymore than they know how critical it is to understand the trade deficit:
“The cession of the whole treaty-making power to the president and the senate is one of the most fearful features in this Constitution, as they can enter into the most ruinous of foreign engagements.” Patrick Henry
John Boehner and the Senate have given the impostor president, Barry Soetoro aka Obama, every single “free” trade treaty since he unlawfully took office. The traitorous dogs in the Outlaw Congress aren’t finished yet with killing off yet more jobs:
“JBS CEO Art Thompson’s weekly video news update for September 24-30, 2012. In this week’s video he discusses how Republicans and Democrats want to open up trade with Russia, which means that more jobs will leave the country; how the State Department and the U.S. Chamber of Commerce are working to get U.S. businesses to invest in Egypt, which means still more U.S. jobs lost; how JBS was calling Osama bin Laden a terrorist back when the world press was naming him a man of peace; and how the Council on Foreign Relations is continuing its drive toward a New World Order with its influence over our military’s role in Afghanistan.”
I hear people say all the time, you can’t find Made in USA. Not true. More and more retailers are making sure with a big sticker on the product that it’s Made in America and in tv commercial ads. Two days ago I needed a new cookie sheet and a new pizza pan. I bought both of them at my local HEB grocery store and both had a nice big easy to remove sticker that said Made in USA. I wanted to purchase the orgreenic frying pan you see on tv; nothing sticks to it. I called their toll free number. Made in Communist China. No, thanks. I’m not going to sell out my fellow Americans over a frying pan.
As this is a small rural town, over the years you get to know management where you shop on a regular basis. When I first moved to Big Spring, there was no organic veggies and few products at our local supermarket. After a couple of years, I took my receipts to management and said, here — see what I spend over in Midland (40 miles away) to get what I want? It’s taken time, but HEB has really improved with an excellent assortment of organic items like Virgin Organic Coconut Oil, which I use for cooking, as well as a full selection of fruits and veggies.
I showed management they lost money because I refuse to buy foreign fruits and vegetables. I will drive out of town to get them and buy from local farmers markets. We just have to make our voices heard and let management know where we put our consumer dollars.
Every time you buy made in Communist China, Communist Hong Kong or some other country — especially for cars and trucks owned by Toyota and the rest of the foreign manufacturers — you enrich them, not America.
The trade deficit continues to go up while employment for Americans goes down. People are now paying workers in India for a job they used to have, yet they continue to reelect the same sell outs like John Boehner and Nancy Pelosi who have consistently voted to kill American jobs and send them overseas.
Does anyone see the insanity going on here?
More than 223,000 businesses have closed since the 2008 meltdown. After the above mentioned unconstitutional, sovereignty killing treaties were passed, America began to shift from being the world leader in agriculture, manufacturing and engineering. “Free” trade was going to be the biggest boon for America since the railroad!!!
That is nothing but propaganda. It was America’s protectionist policies of the of the late 19th and early 20th centuries that made America an economic superpower on this earth. Fair trade worked in the past, until greed, as usual, took over.
Those protectionist policies made America prosperous, providing good paying jobs in the ag, manufacturing and industrial sectors. After those destructive trade treaties were passed, MILLIONS ended up working at McDonald’s or other minimum wage jobs. Instead of manufacturing and growing all we need to be a self sustaining nation, more and more entertainment based businesses sprung up. When the middle class began hemorrhaging jobs, people were forced to count every penny and that means eating at home and no more $100 a game NBA tickets. Foreclosures were the hottest business in the country.
For almost two decades, the American people, through their consumer dollars, have been building up
countr
ies like India while America continues to slide into economic depression. For almost two decades, Americans are now paying foreign workers for jobs they once held.
Of course, we must not forget the profitable undelcared “wars” that have been going on for over a decade in the Middle East. Big money for defense contractors and private sector contractors hauling in blood money. Yes, blood money. Work for a company building those drones that killed more than 2,500 innocent civilians in countries like Pakistan:
“According to a report last month by academics at Stanford and New York universities, between 2,562 and 3,325 people have been killed since the strikes in Pakistan began in 2004. The report said of those, up to 881 were civilians, including 176 children. Only 41 people who had died had been confirmed as ‘high-value’ terrorist targets.”
Murder being done in our name. Paychecks that drip blood of innocents.
“New Report: U.S.A. Too Dependent on Foreign Suppliers in Crises Revitalizing American Manufacturing called “Urgent National Priority.” New report by former Homeland Security Secretary Tom Ridge and former Assistant Secretary for Homeland Security Robert B. Stephan sees the U.S. as too dependent on foreign suppliers in crises.”
Every time we buy Made in America, those companies grow. The money stays in our country. The employee spends locally for things like the dry cleaners, the hardware store and all the small businesses that are the engine of our economy.
There is plenty of time to order on line for items for Thanksgiving and Christmas. Keep telling retailers you want Made in America. Let foreign junk sit on the shelves. Tell retailers you will take the time to order on line. Tell retailers you want Made in America products in their store or you won’t buy.
I would also ask folks to remember that Communist China is NOT our friend. They use slave labor, kill their own people all the time and force women to have abortions right up to term. Can it get more evil than that?
Let me also offer this up as I do every year. If you do gift giving, it doesn’t always have to be a ‘thing’. A few years ago when my niece and nephew lived in Las Vegas, I purchased a family membership to the fantastic Las Vegas Natural History Museum. For $65.00, the kids, my neice and her husband had a year of memories and fun instead of some junk you made in Communist China or another piece of clothing from India.
There are many creative things to give to children, teens and young adults for Christmas that enrich their lives. Use a search engine for your city and type in tourism. You’ll see all kinds of things to give gift certificates for like maybe horse back riding, a day trip to one of the most fabulous places outside Denver, CO, The Wild Animal Sanctuary, or some other activity that creates family memories instead of some toy made in Communist China. Look at how many recall of toys over lead content are from Communist China. Think it’s an accident?
Just my personal note: I rejected American Apparel when they contacted me because they use sex to sell their products; too many of their models look underage. The last time I looked at their site, young girls had their backsides spread to the camera with a thin piece of material barely covering their “butt crack”. Not to mention:
“American Apparel finds itself once again in a familiar place — sued again for sexual harassment and creating a hostile work environment, because of the vulnerability its CEO’s philosophy of sexual freedom in the workplace creates for the publicly held company.” (Chief of American Apparel Faces 2nd Harassment Suit) No thanks.
Did you know Glenn Beck did this? “The 1791 brand was built around one idea: Made in America. Late last year, Glenn took a look at some of his favorite denim companies and realized they were making their clothing overseas. He was frustrated. How could something so inherent to the spirit and the history of this country NOT be made in the USA anymore? Not content to sit back and complain, Glenn charged the 1791 team with creating a pair of jeans that would be designed and crafted here in America.
“The result is 1791 Denim. It took 1791 a full year to get the jeans right, but now they’re finally ready. The premium 100% cotton ring-spun selvage denim jeans are 100% “Made in the USA”. They are woven in Greensboro, NC at Cone Denim® Mills, and are cut and sewn in Kentucky in a factory established in the 1920’s.”
Please make this a Made in America Christmas so those companies can expand and hire American workers- all year long. We the people, our ancestors and family built this nation and made it a prosperous one. We can do it again.
Devvy Kidd authored the booklets, Why A Bankrupt America and Blind Loyalty; 2 million copies sold. Devvy appears on radio shows all over the country. She left the Republican Party in 1996 and has been an independent voter ever since. Devvy isn’t left, right or in the middle; she is a constitutionalist who believes in the supreme law of the land, not some political party.
Buy American: Movement to Find ‘Made in U.S.A' Products Gains Steam
UncategorizedOctober 23, 2012
Perry, 44, sometimes uses her great-grandmother’s crochet hooks to make crafts and her original Slinky — a toy she saved from her childhood — is still in top shape.
Perry is surrounded by items from the past, but she’s an example of the future — one in which more American consumers are seeking out and buying 100 percent American-made goods.
“It is very difficult to find a truly ‘made in America’ product,” said Perry, a married mother of four. As a small-business owner, she understands the costs associated with stateside manufacturing, but as a consumer, she wants high-quality goods made right at home.
“How many plants have to shut down or jobs have to be lost because we do not manufacture in this country anymore?” she asks.
For several decades, “made in the U.S.A.” — a label once proudly imprinted on everything from apparel to cars — hasn’t just been hard to find; it’s been a hard sell.
In the minds of many American consumers, foreign goods came to represent superior quality at a lower cost. Shoppers showed their preference with their purchases.
Several previous attempts to invigorate consumer interest in American-made products fell flat, says Marshal Cohen, chief industry analyst for market research firm, NPD Group, but this time around the movement seems to have more traction with a broad range of consumers, including younger generations.
In the past two years, retailers, fashion designers and even musicians — most recently at a two-day benefit concert last month in Philadelphia curated by rapper Jay-Z — have all seized some aspect of the modern made-in-America movement.
“Made in the U.S.A. now is all about patriotism,” Cohen said. “It’s about supporting jobs in the U.S. rather than shipping them off.” The topic is a hot issue in the current political climate, fueled in part by last summer’s outcry from members of Congress over the Chinese-made U.S. Olympic team uniforms.
Buford, Ga.-based Okabashi Brands, Inc., which has designed, manufactured and assembled its sandals and flip-flops in the U.S. since the company launched in 1984, is changing its tagline to reflect that history.
They are on the verge of deals to manufacture private-label shoes for several large companies — including one that holds a 50-percent share of the flip-flop market — seeking to launch made-in-America lines, said Jason Boswell, vice president of sales.
Traditionally, U.S. manufacturing has come with a higher cost, but as overseas labor costs increase, the gap is closing, Boswell says.
Consumers, seduced by decades of low-cost goods or facing economic constraints, have resisted paying higher prices for American-made products, but this, too, is slowly changing, Cohen said.
“Consumers will say, ‘I’ll pay (up to) 10 percent more (for American-made goods).’ Some will say up to 25 percent more,” Cohen said. “I believe half of that to be true, but the fact that they are willing to spend a little more tells you something.”
Still, the desire to buy American doesn’t always translate into action, and one of the challenges consumers face is figuring out which products are truly American-made.
In addition to buying antiques that she knows were made in America, Perry will email or call companies to ask if their products are 100-percent U.S.-made. It takes effort and sometimes she is forced to take her business elsewhere — often to mom-and-pop stores where she may pay more.
But Perry isn’t complaining.
“Either society has to shift and be willing to pay a little more for something that is a little better,” Perry says, “or ‘made in America’ simply isn’t going to exist anymore.”
US Economic Growth Up Sharply in Third Quarter
UncategorizedThe jump was partly due to a large increase in government spending.
The figures are the one of the last pieces of important economic data before the US presidential election between Barack Obama and his challenger Mitt Romney on 6 November.
Federal government expenditures and gross investment increased 9.6% compared with the previous quarter, while national defence spending rose by 13%. The Commerce Department said there was a jump in personal consumption as well.
A drought in the US, which was the worst for 50 years, cut farm output and took 0.4 percentage points off the GDP figures, the Commerce Department said.
With more than 20 million Americans unemployed and a huge public deficit, the economy has become one of the central issues of the campaign.
The US has now been growing for more than three years, since June 2009.
“Growth came in a little higher than we had feared, largely because of the big jump in federal spending,” said Paul Ashworth, chief US economist at Capital Economics.
“But the economy is still not growing rapidly enough to create sufficient jobs to reduce the unemployment rate.”
Economic fightMr Romney has repeatedly challenged President Obama’s record, saying ”we have not made the progress we need to make”.
“If the president were re-elected, we’d go to almost $20 trillion (£12.4tn) of national debt. This puts us on a road to Greece,” Mr Romney said during the second presidential debate.
Mr Obama replied that his opponent did not have a five-point plan to fix the economy, but ”a one-point plan”.
Last month, the US unemployment rate fell to 7.8%, down from 8.1%, its lowest since January 2009 when Mr Obama’s term in office began.
Nigel Gault, chief US economist at IHS Global Insight, said: “There is prospect that we could do better next year if we could clear up some of the uncertainties, particularly the fiscal cliff.
“A lot of the ingredients for stronger growth are falling into place, particularly the gradual easing of credit conditions and the improvement in the housing market.”
The “fiscal cliff” refers to automatic tax hikes and government spending cuts that were agreed by Democrats and Republicans during the last budget face-off, which will drain about $600bn out of the economy next year unless action is taken by Congress.
Low interest ratesTo help get the US economy back on track, the US Federal Reserve in September restarted its policy of pumping money into the economy via quantitative easing. The Fed pledged to buy $40bn of mortgage debt a month, with the aim of reducing long-term borrowing costs for firms and households.
“Growth was fairly resilient,” said Christopher Vecchio, a currency analyst at DailyFX, but “nevertheless, this is still not the stable recovery the Federal Reserve is looking for”.
Recent housing data has also shown some encouraging signs of recovery, analysts say.
Sales of existing homes and housing construction have picked up and the main home price index has risen consecutively for three months.
House prices have rebounded in some areas, while mortgage rates are expected to stay at record lows because of low interest rates.
The Fed has vowed to keep rates at the current levels of close to zero until 2015.
The economy grew by 1.3% in the previous quarter. The US states its growth in annualised terms, meaning that its quarterly growth rate is extrapolated as if it was growing at that pace for the whole year.
What is your experience of the US economy? Have you recently found a job? Or are you unemployed? Have you found borrowing easier? Send us your comments using the form below.
Billions in Hidden Riches for Family of Chinese Leader
UncategorizedOctober 25, 2012
The details of how Ms. Yang, a widow, accumulated such wealth are not known, or even if she was aware of the holdings in her name. But it happened after her son was elevated to China’s ruling elite, first in 1998 as vice prime minister and then five years later as prime minister.
Many relatives of Wen Jiabao, including his son, daughter, younger brother and brother-in-law, have become extraordinarily wealthy during his leadership, an investigation by The New York Times shows. A review of corporate and regulatory records indicates that the prime minister’s relatives — some of whom, including his wife, have a knack for aggressive deal making — have controlled assets worth at least $2.7 billion.
In many cases, the names of the relatives have been hidden behind layers of partnerships and investment vehicles involving friends, work colleagues and business partners. Untangling their financial holdings provides an unusually detailed look at how politically connected people have profited from being at the intersection of government and business as state influence and private wealth converge in China’s fast-growing economy.
Unlike most new businesses in China, the family’s ventures sometimes received financial backing from state-owned companies, including China Mobile, one of the country’s biggest phone operators, the documents show. At other times, the ventures won support from some of Asia’s richest tycoons. The Times found that Mr. Wen’s relatives accumulated shares in banks, jewelers, tourist resorts, telecommunications companies and infrastructure projects, sometimes by using offshore entities.
The holdings include a villa development project in Beijing; a tire factory in northern China; a company that helped build some of Beijing’s Olympic stadiums, including the well-known “Bird’s Nest”; and Ping An Insurance, one of the world’s biggest financial services companies.
As prime minister in an economy that remains heavily state-driven, Mr. Wen, who is best known for his simple ways and common touch, more importantly has broad authority over the major industries where his relatives have made their fortunes. Chinese companies cannot list their shares on a stock exchange without approval from agencies overseen by Mr. Wen, for example. He also has the power to influence investments in strategic sectors like energy and telecommunications.
Because the Chinese government rarely makes its deliberations public, it is not known what role — if any — Mr. Wen, who is 70, has played in most policy or regulatory decisions. But in some cases, his relatives have sought to profit from opportunities made possible by those decisions.
The prime minister’s younger brother, for example, has a company that was awarded more than $30 million in government contracts and subsidies to handle wastewater treatment and medical waste disposal for some of China’s biggest cities, according to estimates based on government records. The contracts were announced after Mr. Wen ordered tougher regulations on medical waste disposal in 2003 after the SARS outbreak.
In 2004, after the State Council, a government body Mr. Wen presides over, exempted Ping An Insurance and other companies from rules that limited their scope, Ping An went on to raise $1.8 billion in an initial public offering of stock. Partnerships controlled by Mr. Wen’s relatives — along with their friends and colleagues — made a fortune by investing in the company before the public offering.
In 2007, the last year the stock holdings were disclosed in public documents, those partnerships held as much as $2.2 billion worth of Ping An stock, according to an accounting of the investments by The Times that was verified by outside auditors. Ping An’s overall market value is now nearly $60 billion.
Ping An said in a statement that the company did “not know the background of the entities behind our shareholders.” The statement said, “Ping An has no means to know the intentions behind shareholders when they buy and sell our shares.”
While Communist Party regulations call for top officials to disclose their wealth and that of their immediate family members, no law or regulation prohibits relatives of even the most senior officials from becoming deal-makers or major investors — a loophole that effectively allows them to trade on their family name. Some Chinese argue that permitting the families of Communist Party leaders to profit from the country’s long economic boom has been important to ensuring elite support for market-oriented reforms.
Even so, the business dealings of Mr. Wen’s relatives have sometimes been hidden in ways that suggest the relatives are eager to avoid public scrutiny, the records filed with Chinese regulatory authorities show. Their ownership stakes are often veiled by an intricate web of holdings as many as five steps removed from the operating companies, according to the review.
In the case of Mr. Wen’s mother, The Times calculated her stake in Ping An — valued at $120 million in 2007 — by examining public records and government-issued identity cards, and by following the ownership trail to three Chinese investment entities. The name recorded on his mother’s shares was Taihong, a holding company registered in Tianjin, the prime minister’s hometown.
The apparent efforts to conceal the wealth reflect the highly charged politics surrounding the country’s ruling elite, many of whom are also enormously wealthy but reluctant to draw attention to their riches. When Bloomberg News reported in June that the extended family of Vice President Xi Jinping, set to become China’s next president, had amassed hundreds of millions of dollars in assets, the Chinese government blocked access inside the country to the Bloomberg Web site.
“In the senior leadership, there’s no family that doesn’t have these problems,” said a former government colleague of Wen Jiabao who has known him for more than 20 years and who spoke on the condition of anonymity. “His enemies are intentionally trying to smear him by letting this leak out.”
The Times presented its findings to the Chinese government for comment. The Foreign Ministry declined to respond to questions about the investments, the prime minister or his relatives. Members of Mr. Wen’s family also declined to comment or did not respond
to re
quests for comment.
Duan Weihong, a wealthy businesswoman whose company, Taihong, was the investment vehicle for the Ping An shares held by the prime minister’s mother and other relatives, said the investments were actually her own. Ms. Duan, who comes from the prime minister’s hometown and is a close friend of his wife, said ownership of the shares was listed in the names of Mr. Wen’s relatives in an effort to conceal the size of Ms. Duan’s own holdings.
“When I invested in Ping An I didn’t want to be written about,” Ms. Duan said, “so I had my relatives find some other people to hold these shares for me.”
But it was an “accident,” she said, that her company chose the relatives of the prime minister as the listed shareholders — a process that required registering their official ID numbers and obtaining their signatures. Until presented with the names of the investors by The Times, she said, she had no idea that they had selected the relatives of Wen Jiabao.
The review of the corporate and regulatory records, which covers 1992 to 2012, found no holdings in Mr. Wen’s name. And it was not possible to determine from the documents whether he recused himself from any decisions that might have affected his relatives’ holdings, or whether they received preferential treatment on investments.
For much of his tenure, Wen Jiabao has been at the center of rumors and conjecture about efforts by his relatives to profit from his position. Yet until the review by The Times, there has been no detailed accounting of the family’s riches.
His wife, Zhang Beili, is one of the country’s leading authorities on jewelry and gemstones and is an accomplished businesswoman in her own right. By managing state diamond companies that were later privatized, The Times found, she helped her relatives parlay their minority stakes into a billion-dollar portfolio of insurance, technology and real estate ventures.
The couple’s only son sold a technology company he started to the family of Hong Kong’s richest man, Li Ka-shing, for $10 million, and used another investment vehicle to establish New Horizon Capital, now one of China’s biggest private equity firms, with partners like the government of Singapore, according to records and interviews with bankers.
The prime minister’s younger brother, Wen Jiahong, controls $200 million in assets, including wastewater treatment plants and recycling businesses, the records show.
As prime minister, Mr. Wen has staked out a position as a populist and a reformer, someone whom the state-run media has nicknamed “the People’s Premier” and “Grandpa Wen” because of his frequent outings to meet ordinary people, especially in moments of crisis like natural disasters.
While it is unclear how much the prime minister knows about his family’s wealth, State Department documents released by the WikiLeaks organization in 2010 included a cable that suggested Mr. Wen was aware of his relatives’ business dealings and unhappy about them.
“Wen is disgusted with his family’s activities, but is either unable or unwilling to curtail them,” a Chinese-born executive working at an American company in Shanghai told American diplomats, according to the 2007 cable.
China’s ‘Diamond Queen’
It is no secret in China’s elite circles that the prime minister’s wife, Zhang Beili, is rich, and that she has helped control the nation’s jewelry and gem trade. But her lucrative diamond businesses became an off-the-charts success only as her husband moved into the country’s top leadership ranks, the review of corporate and regulatory records by The Times found.
A geologist with an expertise in gemstones, Ms. Zhang is largely unknown among ordinary Chinese. She rarely travels with the prime minister or appears with him, and there are few official photographs of the couple together. And while people who have worked with her say she has a taste for jade and fine diamonds, they say she usually dresses modestly, does not exude glamour and prefers to wield influence behind the scenes, much like the relatives of other senior leaders.
The State Department documents released by WikiLeaks included a suggestion that Mr. Wen had once considered divorcing Ms. Zhang because she had exploited their relationship in her diamond trades. Taiwanese television reported in 2007 that Ms. Zhang had bought a pair of jade earrings worth about $275,000 at a Beijing trade show, though the source — a Taiwanese trader — later backed off the claim and Chinese government censors moved swiftly to block coverage of the subject in China, according to news reports at the time.
“Her business activities are known to everyone in the leadership,” said one banker who worked with relatives of Wen Jiabao. The banker said it was not unusual for her office to call upon businesspeople. “And if you get that call, how can you say no?”
Zhang Beili first gained influence in the 1990s, while working as a regulator at the Ministry of Geology. At the time, China’s jewelry market was still in its infancy.
While her husband was serving in China’s main leadership compound, known as Zhongnanhai, Ms. Zhang was setting industry standards in the jewelry and gem trade. She helped create the National Gemstone Testing Center in Beijing, and the Shanghai Diamond Exchange, two of the industry’s most powerful institutions.
In a country where the state has long dominated the marketplace, jewelry regulators often decided which companies could set up diamond-processing factories, and which would gain entry to the retail jewelry market. State regulators even formulated rules that required diamond sellers to buy certificates of authenticity for any diamond sold in China, from the government-run testing center in Beijing, which Ms. Zhang managed.
As a result, when executives from Cartier or De Beers visited China with hopes of selling diamonds and jewelry here, they often went to visit Ms. Zhang, who became known as China’s “diamond queen.”
“She’s the most important person there,” said Gaetano Cavalieri, president of the World Jewelry Confederation in Switzerland. “She was bridging relations between partners — Chinese and foreign partners.”
As early as 1992, people who worked with Ms. Zhang said, she had begun to blur the line between government official and businesswoman. As head of the state-owned China Mineral and Gem Corporation, she began investing the state company’s money in start-ups. And by the time her husband was named vice premier, in 1998, she was busy setting up business ventures with friends and relatives.
The state company she ran invested in a group of affiliated diamond companies, according to public records. Many of them were run by Ms. Zhang’s relatives — or colleagues who had worked with her at the National Gemstone Testing Center.
In 1993, for instance, the state company Ms. Zhang ran helped found Beijing Diamond, a big jewelry retailer. A year later, one of her younger brothers, Zhang Jianming, and two of her government colleagues personally acquired 80 percent of the company, according to shareholder registers. Beijing Diamond invested in Shenzhen Diamond, which was controlled by her brother-in-law, Wen Jiahong, the prime minister’s younger brother.
Among the successful undertakings was Sino-Diamond, a venture financed by the state-owned China Mineral and Gem Corporation, which she headed. The company had business ties with a state-owned company managed by another brother, Zhang Jiankun, who worked as an official in Jiaxing,
Ms. Zhang’s hometown, in Zhejiang Province.
In the summer of 1999, after securing agreements to import diamonds from Russia and South Africa, Sino-Diamond went public, raising $50 million on the Shanghai Stock Exchange. The offering netted Ms. Zhang’s family about $8 million, according to corporate filings.
Although she was never listed as a shareholder, former colleagues and business partners say Ms. Zhang’s early diamond partnerships were the nucleus of a larger portfolio of companies she would later help her family and colleagues gain a stake in.
The Times found no indication that Wen Jiabao used his political clout to influence the diamond companies his relatives invested in. But former business partners said that the family’s success in diamonds, and beyond, was often bolstered with financial backing from wealthy businessmen who sought to curry favor with the prime minister’s family.
“After Wen became prime minister, his wife sold off some of her diamond investments and moved into new things,” said a Chinese executive who did business with the family. He asked not to be named because of fear of government retaliation. Corporate records show that beginning in the late 1990s, a series of rich businessmen took turns buying up large stakes in the diamond companies, often from relatives of Mr. Wen, and then helped them reinvest in other lucrative ventures, like real estate and finance.
According to corporate records and interviews, the businessmen often supplied accountants and office space to investment partnerships partly controlled by the relatives.
“When they formed companies,” said one businessman who set up a company with members of the Wen family, “Ms. Zhang stayed in the background. That’s how it worked.”
The Only Son
Late one evening early this year, the prime minister’s only son, Wen Yunsong, was in the cigar lounge at Xiu, an upscale bar and lounge at the Park Hyatt in Beijing. He was having cocktails as Beijing’s nouveau riche gathered around, clutching designer bags and wearing expensive business suits, according to two guests who were present.
In China, the children of senior leaders are widely believed to be in a class of their own. Known as “princelings,” they often hold Ivy League degrees, get V.I.P. treatment, and are even offered preferred pricing on shares in hot stock offerings.
They are also known as people who can get things done in China’s heavily regulated marketplace, where the state controls access. And in recent years, few princelings have been as bold as the younger Mr. Wen, who goes by the English name Winston and is about 40 years old.
A Times review of Winston Wen’s investments, and interviews with people who have known him for years, show that his deal-making has been extensive and lucrative, even by the standards of his princeling peers.
State-run giants like China Mobile have formed start-ups with him. In recent years, Winston Wen has been in talks with Hollywood studios about a financing deal.
Concerned that China does not have an elite boarding school for Chinese students, he recently hired the headmasters of Choate and Hotchkiss in Connecticut to oversee the creation of a $150 million private school now being built in the Beijing suburbs.
Winston Wen and his wife, moreover, have stakes in the technology industry and an electric company, as well as an indirect stake in Union Mobile Pay, the government-backed online payment platform — all while living in the prime minister’s residence, in central Beijing, according to corporate records and people familiar with the family’s investments.
“He’s not shy about using his influence to get things done,” said one venture capitalist who regularly meets with Winston Wen.
The younger Mr. Wen declined to comment. But in a telephone interview, his wife, Yang Xiaomeng, said her husband had been unfairly criticized for his business dealings.
“Everything that has been written about him has been wrong,” she said. “He’s really not doing that much business anymore.”
Winston Wen was educated in Beijing and then earned an engineering degree from the Beijing Institute of Technology. He went abroad and earned a master’s degree in engineering materials from the University of Windsor, in Canada, and an M.B.A. from the Kellogg School of Business at Northwestern University in Evanston, Ill., just outside Chicago.
When he returned to China in 2000, he helped set up three successful technology companies in five years, according to people familiar with those deals. Two of them were sold to Hong Kong businessmen, one to the family of Li Ka-shing, one of the wealthiest men in Asia.
Winston Wen’s earliest venture, an Internet data services provider called Unihub Global, was founded in 2000 with $2 million in start-up capital, according to Hong Kong and Beijing corporate filings. Financing came from a tight-knit group of relatives and his mother’s former colleagues from government and the diamond trade, as well as an associate of Cheng Yu-tung, patriarch of Hong Kong’s second-wealthiest family. The firm’s earliest customers were state-owned brokerage houses and Ping An, in which the Wen family has held a large financial stake.
He made an even bolder move in 2005, by pushing into private equity when he formed New Horizon Capital with a group of Chinese-born classmates from Northwestern. The firm quickly raised $100 million from investors, including SBI Holdings, a division of the Japanese group SoftBank, and Temasek, the Singapore government investment fund.
Under Mr. Wen, New Horizon established itself as a leading private equity firm, investing in biotech, solar, wind and construction equipment makers. Since it began operations, the firm has returned about $430 million to investors, a fourfold profit, according to SBI Holdings.
“Their first fund was dynamite,” said Kathleen Ng, editor of Asia Private Equity Review, an industry publication in Hong Kong. “And that allowed them to raise a lot more money.”
Today, New Horizon has more than $2.5 billion under management.
Some of Winston Wen’s deal-making, though, has attracted unwanted attention for the prime minister.
In 2010, when New Horizon acquired a 9 percent stake in a company called Sihuan Pharmaceuticals just two months before its public offering, the Hong Kong Stock Exchange said the late-stage investment violated its rules and forced the firm to return the stake. Still, New Horizon made a $46.5 million profit on the sale.
Soon after, New Horizon announced that Winston Wen had handed over day-to-day operations and taken up a position at the China Satellite Communications Corporation, a state-owned company that has ties to the Chinese space program. He has since been named chairman.
The Tycoons
In the late 1990s, Duan Weihong was managing an office building and several other properties in Tianjin, the prime minister’s hometown in northern China, through her property company, Taihong. She was in her 20s and had studied at the Nanjing University of Science and Technology.
Around 2002, Ms. Duan went into business with several relatives of Wen Jiabao, transforming her property company into an investment vehicle of the same name. The company helped make Ms. Duan very wealthy.
It is not known whether Ms. Duan, now 43, is related to the prime minister. In a series of interviews, she first said she did not know any members of t
he Wen family, but later described herself as a friend of the family and particularly close to Zhang Beili, the prime minister’s wife. As happened to a handful of other Chinese entrepreneurs, Ms. Duan’s fortunes soared as she teamed up with the relatives and their network of friends and colleagues, though she described her relationship with them involving the shares in Ping An as existing on paper only and having no financial component.
Ms. Duan and other wealthy businesspeople — among them, six billionaires from across China — have been instrumental in getting multimillion-dollar ventures off the ground and, at crucial times, helping members of the Wen family set up investment vehicles to profit from them, according to investment bankers who have worked with all parties.
Established in Tianjin, Taihong had spectacular returns. In 2002, the company paid about $65 million to acquire a 3 percent stake in Ping An before its initial public offering, according to corporate records and Ms. Duan’s graduate school thesis. Five years later, those shares were worth $3.7 billion
The company’s Hong Kong affiliate, Great Ocean, also run by Ms. Duan, later formed a joint venture with the Beijing government and acquired a huge tract of land adjacent to Capital International Airport. Today, the site is home to a sprawling cargo and logistics center. Last year, Great Ocean sold its 53 percent stake in the project to a Singapore company for nearly $400 million.
That deal and several other investments, in luxury hotels, Beijing villa developments and the Hong Kong-listed BBMG, one of China’s largest building materials companies, have been instrumental to Ms. Duan’s accumulation of riches, according to The Times’s review of corporate records.
The review also showed that over the past decade there have been nearly three dozen individual shareholders of Taihong, many of whom are either relatives of Wen Jiabao or former colleagues of his wife.
The other wealthy entrepreneurs who have worked with the prime minister’s relatives declined to comment for this article. Ms. Duan strongly denied having financial ties to the prime minister or his relatives and said she was only trying to avoid publicity by listing others as owning Ping An shares. “The money I invested in Ping An was completely my own,” said Ms. Duan, who has served as a member of the Ping An board of supervisors. “Everything I did was legal.”
Another wealthy partner of the Wen relatives has been Cheng Yu-tung, who controls the Hong Kong conglomerate New World Development and is one of the richest men in Asia, worth about $15 billion, according to Forbes.
In the 1990s, New World was seeking a foothold in mainland China for a sister company that specializes in high-end retail jewelry. The retail chain, Chow Tai Fook, opened its first store in China in 1998.
Mr. Cheng and his associates invested in a diamond venture backed by the relatives of Mr. Wen and co-invested with them in an array of corporate entities, including Sino-Life, National Trust and Ping An, according to records and interviews with some of those involved. Those investments by Mr. Cheng are now worth at least $5 billion, according to the corporate filings. Chow Tai Fook, the jewelry chain, has also flourished. Today, China accounts for 60 percent of the chain’s $4.2 billion in annual revenue.
Mr. Cheng, 87, could not be reached for comment. Calls to New World Development were not returned.
Fallout for Premier
In the winter of 2007, just before he began his second term as prime minister, Wen Jiabao called for new measures to fight corruption, particularly among high-ranking officials.
“Leaders at all levels of government should take the lead in the antigraft drive,” he told a gathering of high-level party members in Beijing. “They should strictly ensure that their family members, friends and close subordinates do not abuse government influence.”
The speech was consistent with the prime minister’s earlier drive to toughen disclosure rules for public servants, and to require senior officials to reveal their family assets.
Whether Mr. Wen has made such disclosures for his own family is unclear, since the Communist Party does not release such information. Even so, many of the holdings found by The Times would not need to be disclosed under the rules since they are not held in the name of the prime minister’s immediate family — his wife, son and daughter.
Eighty percent of the $2.7 billion in assets identified in The Times’s investigation and verified by the outside auditors were held by, among others, the prime minister’s mother, his younger brother, two brothers-in-law, a sister-in-law, daughter-in-law and the parents of his son’s wife, none of whom is subject to party disclosure rules. The total value of the relatives’ stake in Ping An is based on calculations by The Times that were confirmed by the auditors. The total includes shares held by the relatives that were sold between 2004 and 2006, and the value of the remaining shares in late 2007, the last time the holdings were publicly disclosed.
Legal experts said that determining the precise value of holdings in China could be difficult because there might be undisclosed side agreements about the true beneficiaries.
“Complex corporate structures are not necessarily insidious,” said Curtis J. Milhaupt, a Columbia University Law School professor who has studied China’s corporate group structures. “But in a system like China’s, where corporate ownership and political power are closely intertwined, shell companies magnify questions about who owns what and where the money came from.”
Among the investors in the Wen family ventures are longtime business associates, former colleagues and college classmates, including Yu Jianming, who attended Northwestern with Winston Wen, and Zhang Yuhong, a longtime colleague of Wen Jiahong, the prime minister’s younger brother. The associates did not return telephone calls seeking comment.
Revelations about the Wen family’s wealth could weaken him politically.
Next month, at the 18th Party Congress in Beijing, the Communist Party is expected to announce a new generation of leaders. But the selection process has already been marred by one of the worst political scandals in decades, the downfall of Bo Xilai, the Chongqing party boss, who was vying for a top position.
In Beijing, Wen Jiabao is expected to step down as prime minister in March at the end of his second term. Political analysts say that even after leaving office he could remain a strong backstage political force. But documents showing that his relatives amassed a fortune during his tenure could diminish his standing, the analysts said.
“This will affect whatever residual power Wen has,” said Minxin Pei, an expert on Chinese leadership and a professor of government at Claremont McKenna College in California.
The prime minister’s supporters say he has not personally benefited from his extended family’s business dealings, and may not even be knowledgeable about the extent of them.
Last March, the prime minister hinted that he was at least aware of the persistent rumors about his relatives. During a nationally televised news conference in Beijing, he insisted that he had “never pursued personal gain” in public office.
“I have the courage to face the people and to face history,” he said in an emotional session. “There are people who will appreciate what I have done, but there are also people who will criticize me. Ulti
mately, history will have the final say.”
A version of this article appeared in print on October 26, 2012, on page A1 of the New York edition with the headline: Billions Amassed in the Shadows By the Family of China’s Premier.
Why China Hates U.S. Presidential Elections
UncategorizedOct 24, 2012
Ding’s article, which ran with the headline “China-bashing: Shame on American Politics,” is an extreme example of the angst—even anger—that many Chinese feel when they listen to American presidential candidates talk tough on China. Most people in China, of course, don’t hate Americans. But Chinese policymakers do hate American elections—especially the effect they have on China’s image in the United States. This year has been especially bad, analysts say, as Beijing has been blamed for everything from the sluggish U.S. economy to America’s high unemployment rate. Coming at a time of declining economic growth in China and fierce competition over trade between the two countries has created considerable tension.
That tension is reflected in the polls. An October poll from the Pew Research Center found that 49 percent of American voters want the U.S. to get tough on China, an increase of nine percent from March of 2011. And only 42 percent of voters want the U.S. to build a strong relationship with China, compared to 53 percent in March of last year. Most of the American angst about China is economic as opposed to military, according to a September Pew poll, with the biggest concerns being the amount of American debt held by China and the loss of U.S. jobs.
Poll results reflect rising friction in China as well. A separate Pew Survey, for instance, found growing wariness and negative perceptions of America compared to two years ago. The percentage of Chinese respondents who characterize their country’s relationship with the U.S. as one of cooperation has dropped from 68 percent in 2010 to 39 percent today. More than a quarter of those surveyed said the relationship was hostile, compared to eight percent two years ago. Confidence in Ratings President Barack Obama also declined significantly, down to 38 percent compared to 52 percent in 2010.
One reason why Chinese leaders in particular dislike changes in Washington: they feel the need “to teach the new American president about the realities of the relationship,” said one Chinese source who requested anonymity because he wasn’t cleared to talk with media. These realities, in the Chinese view, include the need to avoid a trade war that, because of their interdependence, would undermine both economies. The learning curve for U.S. presidents can make for jittery moments. In April of 2001, for instance, not long after George W. Bush took office, a U.S. EP-3 spy plane collided with a Chinese jet fighter in mid-air over the South China Sea. The 24 crew members of the American plane subsequently landed on China’s Hainan Island. After 11 days of intense negotiations over apologetic language, they were released. But the incident turned out to be more protracted and more difficult to resolve than expected.
Ding’s strident take on American-style multi-party democracy is not shared by a majority of Chinese, according to a Pew survey, conducted earlier this year in China. More than 50 percent of respondents said they like American ideas about democracy, while 29 percent said they dislike them. Yet this favorable opinion of democracy is yet another reason why Beijing hates American elections: they underscore how ordinary Chinese citizens have little say in choosing their own leaders. The contrast is especially clear when the U.S. results are startling, like Barack Obama’s groundbreaking victory 2008, an outcome which blindsided Chinese analysts.
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Melinda Liu is Bejiing bureau chief for Newsweek and The Daily Beast, a veteran foreign correspondent, and recipient of a number of awards, including the 2006 Shorenstein Journalism Award, acknowledging her reporting on Asia.
For inquiries, please contact The Daily Beast at editorial@thedailybeast.com.
U.S. GDP Grows At Quickening Pace On Government And Consumer Spending
Uncategorized10/26/2012
The pickup in growth may help President Barack Obama’s message that the economy is improving. Still, growth remains too weak to rapidly boost hiring. And the 1.74 percent rate for 2012 trails last year’s 1.8 percent growth, a point GOP nominee Mitt Romney will emphasize.
The report is the last snapshot of economic growth before Americans choose a president in 11 days.
Growth was held back by the first drop in exports in more than three years and flat business investment in equipment and software.
Can ‘Made in America’ Make a Comeback?
UncategorizedOctober, 2012
“It is very difficult to find a truly ‘made in America’ product,” says Melissia Perry, 44, a married mom of four from Woodstock. “How many plants have to shut down or jobs have to be lost because we do not manufacture in this country anymore?” she asks.
Perry drives a 2001 GM Chevy Suburban. Her husband drives a ‘68 Ford Mustang. She’s got fully functional radios and televisions from the 1940s and sometimes uses her great-grandmother’s crochet hooks to make crafts.
She’s surrounded by items from the past, but she’s an example of the future — one in which more American consumers are seeking out and buying 100 percent American-made goods.
The topic is a hot issue in the current political climate, fueled in part last summer by the outcry from members of Congress over the Chinese made U.S. Olympic team uniforms.
Retailers are responding to consumer demand.
In January 2012, AmericasMart — the Atlanta-based global wholesale market center— launched Made in America during The Atlanta International Gift & Home Furnishings Market. The merchandise products mix includes jewelry, paper, candles, apparel and textiles, many of which and much more. Many of the products are manufactured by small independent companies that who take pride in providing local jobs, said Amy James, executive director of AmericasMart.
Buford-based Okabashi Brands, Inc., which has designed, manufactured and assembled its sandals and flip-flops in the U.S. since the company launched in 1984, is changing its tagline to reflect that history.
Traditionally, U.S. manufacturing has come with a higher cost, but as overseas labor costs increase, the gap is closing. At the same time, Americans say they are willing to pay more for American-made products. The hard part is figuring out which products are truly American made.
In addition to buying antiques, Perry says she emails or calls companies to ask if their products are 100 percent U.S. made. Sometimes she has to take her business elsewhere, and sometimes when she does find American made products, she has to pay a bit more. But she isn’t complaining. “Either society has to shift and be willing to pay a little more for something that is a little better,” Perry says, “or ‘made in America’ simply isn’t going to exist anymore.”
Are you willing to pay a little more for Made in America products? Why? And what are your strategies for making sure what you buy is really American made?
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