It’s been said probably countless times: Donald Trump’s administration is coming on January 20; and in between slamming all dissenters, threatening all companies with manufacturing plants in Mexico with burdensome taxation should they export to the US, talking about undoing everything achieved by outgoing President Barack Obama, and putting the fear of God on a wide spectrum of people with his government appointees, he’s also been busy trying to make good on his promise to generate more jobs in America for American workers.
Not what it sounds like
One of his initiatives was born out of a meeting with Jack Ma, founder and chairman of Chinese e-commerce company Alibaba, wherein a gentleman’s agreement was apparently reached for Alibaba to help make at least a million new jobs in the US through Alibaba’s platform over a five-year period. On first blush this sounds wonderful and in line with Trump’s objectives for his presidency, but a more critical reading makes it obvious that the whole deal’s reading could lead plenty of people to make some wrong assumptions where jobs are concerned. Nowhere in news of Ma’s talks with Trump did there substantially state that guaranteed work, much less work for a million Americans, will come from the discussion over Alibaba.
This notion is about as misconstrued as rumors from last year concerning Alibaba supposedly acquiring Paramount Pictures; it was actually a promotional and licensing thing.
Ma and Trump’s talk explained
One reason why Alibaba won’t really be giving jobs to a million Americans that want them is for the simple reason that it’s an e-commerce business, facilitating the online selling of goods from Western markets to China and Asia, and then vice versa.
Since they’re commercial, Alibaba has no manufacturing factories, only warehouses of products for sale, and these are more automated hubs. Jack Ma’s company isn’t even opening a US operations branch that would hire Americans for those jobs.
Rather, the letter of this talk with Trump consists of enabling one million lucky US small businesses to start selling their goods and services to China and Asia, by means of going through Alibaba’s e-commerce market.
It’s simple simulation of trade. Little businesses in America will get help setting up their own online stores on the Alibaba platform to get their products to the Chinese market. As Chinese Market Research Group director Ben Cavender sees it, “I don't see a lot of job creation happening.”
But there might be something on here
That said, the rising Chinese middle class have been keen on getting more foreign goods as an alternative to cheap local products they’ve gotten used to. Alibaba, of which some shares of stock are owned by Yahoo!, reports that Australia, New Zealand and German milk products have proven popular buys for Chinese consumers through their e-commerce. Perhaps with some third party help to translate marketing advertisement into Chinese, a Wisconsin dairy farm for example, could sell their goods to interested China and Asia.
