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Thursday, April 24. 2014
My initial thinking was that air flight is still safe, so if the issue is safety, that's odd. My wife replied, "It's perfectly rational. They think the Malaysian government has mishandled this and they're punishing the government by not traveling."
At first, I thought this was a good reply, but then I thought again. It's still irrational. For two reasons.
The first is a soft reason. 'Punishing' a government is something we all need to do. Governments very rarely do anything right or useful. One could argue the corruption and mismanagement in China is so pervasive, it would do the Chinese tourists well to fix their own government first. I don't know what they are doing, but given the state of affairs there, one could reasonably argue 'not much'. The same is true here, in the U.S., for us. It's a reasonable point, but it doesn't fully make a strong case for how irrational the Malaysian tourism behavior is.
The second reason is that the tourism isn't really hurting the government. Boycotts real people and businesses and rarely send a message to governments. People and businesses who had nothing to do with the missing plane or the mismanagement of the search are impacted. These people rely on tourists, particularly wealthy Chinese, to maintain themselves and their businesses. While it's true this impacts the Malaysian government in terms of taxes, and it could lead to a reversal for the ruling party in the next election. This may impact the current politicians, but is unlikely to yield any meaningful reform. Most importantly, along these lines, it's not expected to be long-lasting. For any meaningful impact, behavior like this would have to be consistent over time.
In the past, I've been guilty of thinking along similar lines when a foreign government didn't do something I thought was right. Over time, I've learned, assuming the government is the people is the wrong attitude. The two are frequently very different things. Chinese tourists may feel better about themselves by not traveling to Malaysia, but it's odd to think they are having any kind of impact, except on the business owners who rely on the stream of visitors they usually get.
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I don't blame the government anymore, I blame the voters ...
Chinese voting with their feet and wallets ...
I thought Malaysian Airlines was owned by the government of Malaysia...therefore, yes, the Chinese could hurt the government by reducing their tourist dollars going to this airline/country.
I responded below, to another comment, and basically addressed this.
Statist systems pass the pain down the line.
"and their punishing the government by not traveling."
"and they're punishing the government by not traveling."
What about travel to Cuba? Many Canadians take their winter vacations in Cuba. This gives the socialist government more funds. The tourists are treated well and can eat whatever they want. The average Cuban citizen has many fewer choices. More tourists will not improve the Cuban standard of living.
Thanks for the catch, don't usually have that kind of error.
There are significant differences between Malaysian and Cuban economies, digging into these would take too much time, but suffice to say one thing - sanctions rarely, if ever, work. Cuban socialism is still around despite a decades long US boycott.
Boycotts, like the Chinese one, may work from time to time. But it requires a long term and focused campaign. If you read the articles I linked to, you'll see a few things.
First - it's only a 30% drop. Significant for an airline, but insignificant in the grand scheme of things in Malaysia.
Second - it's likely to be short-lived. Chinese citizens have used Malaysia as a playground for years, and that's unlikely to change despite this brief dip.
Ultimately, even if you take the view that this is going to have an impact, it's still only hurting the people on the lower end of the economic ladder. As someone else here pointed out, a large percent of these people live off the government. Assuming this does impact the economy in some way - the people at the top are only going to keep what's theirs and pass off the damage to the lower end of the system.
I continue to stand by my assertion this will do nothing of value.
Actually, it's extremely rational.
The Chinese are the economic lifeblood of Malaysia. The Malays don't actually...work. Historically, Malays get jobs in the government (the British hired the Malays to be government clerks during colonial times, while the Chinese were left to successfully run the private sector). Malaysia has the most powerful affirmative action program in the world for ethnic Malays to get into university, because otherwise they couldn't compete against the Chinese.
The Malaysians depend on tax revenues generated by the Malays who are shut out of all university and government jobs - including the national airline. The Chinese very rationally understand this dependency and are behaving accordingly to show their displeasure with the Malaysian government incompetence.
There is 150 years' worth of bad blood between the Malays and the Chinese in Malaysia - this is just the latest chapter.
As I pointed out above, it's still not rational. The impact, in your scenario, would still be on the lower end of the economic system.
Assuming they live off the 'largesse' of the government, the people at the top will keep what's theirs, while less and less is filtered down through the tiers.
It still has no impact.
Assuming, as I do, that the impact is on the lower end because they do own some businesses or have jobs related to tourism, rudimentary accounting would give a good idea of the impact of this 'boycott' (if that's what you call it).
A 30% drop in traffic in the government-owned airline, temporary. Let's say for a year. A boycott needs to be sustained longer than that to be effective.
Let's say China's traffic on that airline represents 50% of total airline traffic. Overall impact is 15% on revenues.
Significant enough, for one year, but if you expect it to rebound, you just cut non-essential staff for a brief period. I doubt China represents 50% of the traffic, but I'll go with it to be conservative.
If you assume that 30% drop in traffic impacts small businesses and tourist related hotels/restaurants/shops, these places will react by cutting staff and/or lowering prices. Both will impact in a fashion I described, only on the lower end of the scale, though lowering prices will mitigate this by attracting SOME additional business.
Let's just say I'm wrong about all of those items. It still doesn't address my first point - that if having an impact on making change is important, better to start at home.
Ultimately, the concept that this is meaningful will only be borne out if the boycott is bigger and lasts longer.
I agree; it is often overlooked (or not even known about) in the West that there is a strong animosity towards ethnic Chinese throughout Southeast Asia.
To make an analogy that might make sense to us in the West; think of Chinese in Southeast Asia as Jews in medieval Europe. Part of the economic structure, yet, at the same time, considered "outsiders" and not fully accepted into the societies they live in. And often, even today, targets of ethnic violence. While we don't call them "pogroms" that is what often happens to ethnic Chinese is various parts, including Malaysia, of Southeast Asia.
That Chinese tourists are now staying away from a country that is viewed as not giving a sh*t about ethic Chinese is rational.
This isn't about being "boycotting" or "punishing" a people or government. It is simply about why go where you're not wanted?
I'm lost on the connection.
I'm well aware of Chinese animosity toward other Asians in the region, but Malaysia was a favorite vacation destination.
If the 'problem' was how they were treated, in general, based on overall animosity, then why were so many going to begin with?
If your assumption is this is rational because they don't like the Malaysians, anyway, and the lost jet just solidified their dislike - then why is this already viewed as a short-term blip?
Clearly there's a different message being sent, or maybe it's that going to Malaysia to begin with is irrational, and this is a short-term blip of rationality.
It is well known that Asian tourists (especially Japanese, but also Koreans and Chinese)are loathe to go to places they perceive as "dangerous." Whether correct or not, the concern about going to Malaysia does not have anything to do with the safety of flying, but rather of the increased fear of Islamic terrorism. I don't think the stories saying either that the plane was hijacked and is now in an Islamic country, or that it was intentionally destroyed by Islamic terrorists, have really been dispelled in the popular mind. In any event, it really brought that Islamic terrorism concern to the surface.
There have been a string of terrorist/kidnapping type attacks against Chinese nationals in Malaysia over the past few months. The most recent was on April 6 in Sabah, by Abu Sayyaf against a Chinese national. That woman, along with a Filipina tourist, are now being held captive for ransom in the Philippines.
At this point, all the chickens are coming home to roost. I think it is eminently rational that if the Chinese believe the Malaysian government is unable to protect their safety, they aren't coming any more.
That's an entirely different set of reasons. The media has, despite the mention of the kidnappings at the end of one article, spun this as entirely related to the plane's disappearance.
I suppose I should blame the US media, which regularly picks the most topical item as the reason for everything that happens.
On the other hand, we have offices in Mexico and we travel there regularly. US nationals have been kidnapped with some regularity in Mexico, yet we keep going. I have friends who just returned from Mexico, visiting a region which had seen some US kidnappings.
Generally, operating out of fear is a bad idea. The day after the space shuttle exploded, I remember being asked if I'd still wanted to go up in it. I said I'd fly in it if they were willing to launch that day. People looked at me like I was nuts.
I figure the odds were in my favor.
I had to go to Israel at the height of the Intifadah. My wife was crazy trying to convince me I shouldn't go. I wandered the streets at night, with no fear. Granted, I was in Tel Aviv.
I still know people who won't go there. I think their reasoning is irrational. You're more likely to be killed by a truck in the streets of New York than by a Palestinian terrorist. But the terrorists make the news.
I guess the kidnappings put a different angle on the idea of not traveling, but it's still not entirely logical.
Asian culture is significantly more tribal than Western, though. Within the contextual framework of their varied cultures, I suppose they can craft something that approaches logic.