I’ve blogged here before on the likely limits to China’s growth (environmental pressures, food and resource shortages, poor financial infrastructure, increasing inequality). But I hadn’t imagined that the list would include simple production failure – or worse.

The recent Mattel toy scandal – in which it had to recall 1.5 million toys tainted by lead paint – is well documented in an article today in the LA Herald Tribune. There’s been a second recall of Pixar toy cars (this time only 436,000 toys involved). And it followed the earlier recall of millions of toys with dodgy magnets. This for a company which has a long manufacturing history in China.

Some of the coverage has implied that this is mostly a toy problem (China makes 80% of thew world’s toys) but this isn’t the case. An article in June in Open Democracy by Patrice de Beer suggested that (with the exception of Japan) Western governments which elsewhere sought to promote greater business transparency and were strong on health and safety applied different rules to China, pursuing a narrow business agenda:

This might explain why Washington has reacted so mildly to the melamine-tainted pet-food scandal which has killed 8,500 dogs (also sold for use in feed for hogs and chickens) in the United States and caused a massive recall; or to the drug scandal involving cough syrup laced with poisonous diethylene glycol (used in anti-freeze) falsely labelled as less expensive – but fit for human consumption – glycerine, which caused the death of between 100 and 450 Panamanian kids after having been used in exported toothpaste (see “Cleaning up China’s Honey“, Los Angeles Times, 3 May 2007; “From China to Panama, a Trail of Poisoned Medicine“, International Herald Tribune, 5 May 2007; “Tainted Chinese Imports Common“, Washington Post, 20 May 2007; “China Investigates Contaminated Toothpaste“, International Herald Tribune, 22 May 2007).

de Beer notes that even this is only the headlines: “In the first four months of 2007, US Food and Drug Administration (FDA) inspectors – who are able to check less than 1% of imports – have sent back to China 298 contaminated food shipments (twenty-five times more than from Canada); among them dried apples preserved with a cancer-causing chemical, honey with banned antibiotics, mushrooms with illegal pesticides… many of which turn up again at US borders.”

There are a couple of additional points worth making here. The first is that in some ways American companies have only got themselves to blame. One of the largely overlooked stories from China – also in June – was about the extension of laws on workers’ rights. This was partly to reduce labour unrest. Generally, better employment conditions are associated with improvements in quality of production. The biggest opponents of the legislation were … American multinationals, which said it would hurt their competitiveness. And when rights groups identify abuses, companies seem slow to respond.

This seems to me to be a dangerous game to play. It’s not clear how long American companies can point the finger at their suppliers – if they are complicit in maintaining conditions in which quality is likely to be poor. And it seems likely that consumers will start looking behind the price tag to the label if they don’t know what they can trust. The woman who drove a car load of Mattel toys to company HQ and asked them to tell her which ones were safe may be a sign of times to come.