Nanyang 1931: From piglets to giants

Chapter 123 Super Smart Man

After just visiting this petrochemical plant, Marshal Mac had already made up his mind that the United States must build an air force base in Penang.

Bullshit international image and diplomatic relations.

He was sure that those gentlemen in Parliament who opposed the proposal had absolutely no idea how much money this small state of Penang could make!

Seriously, Marshal Mai really wanted to go to war with Britain and seize the city directly.

"Marshal Mai, please, let's go a little further south. Besides these chemical plants, Penang has many other factories."

“Look, this is a power plant. The major shareholder is British Electric. But later, as Penang’s electricity consumption increased, the construction speed could not keep up. So they introduced several power companies from the United States, Sweden, Germany, etc.
We Chinese have also tried to build a few ourselves. You see, the one that's emitting black smoke is this one. Because I refine the oil myself, the cost of generating electricity is not bad, it's quite cheap."

"Electricity is cheap, foreign exchange is unregulated, and although labor costs are now higher than in Japan, they are still relatively affordable compared to Europe and the United States.

As for land cost, industrial land in Penang is very cheap at present, and even free if you use a lot of labor.

Finally, we don’t charge production and business taxes, nor do we have a departure tax. Many companies are willing to set up factories in Penang. However, our water costs are relatively high, making it unsuitable for businesses that use a lot of water.”

"Over there, Marshal Mai, look, that's American Steel. In the past two years, they have moved six steel furnaces to Penang.
We actually had our own steel mill in Penang. After US Steel moved in, we merged with them and acquired about 10% of the shares.”

"The chemical plants you just saw, as well as the steel bars needed to build the buildings over the past two years, were all produced here."

Marshal Mai frowned in dissatisfaction upon hearing this and said, "In just two years, they've produced so much steel. That must be several million tons."

Although Marshal MacArthur's level and ability were a disgrace to the famous generals of World War II, he was still a soldier after all. He knew that the US steel industry suffered heavy losses during the Great Depression and that its production capacity was seriously oversupplied.

But steel at this time was highly linked to military industry, so he was reluctant to allow too much American steel production capacity to be transferred abroad.

Zheng Yi: "Indeed, Penang has used a total of about two million tons of steel in the past two years, mainly because of the rapid construction. However, it is not bad. Currently, the annual production of the US Steel branch in Penang is less than one million tons."

Marshal Mai frowned: "Did you buy scrap steel to recycle?"

Zheng Yi nodded. "Yes, and we bought a lot. There are probably more than four million tons left. Some are in the warehouse, and some are on the way."

"Boy, you have raised the international steel frame by your own efforts."

"I can't help it. The demand is just too great."

In fact, Zheng Yi's purchase of these scrap steels can be considered a contribution to the country.

After World War I, the price of steel was too cheap, especially American scrap steel. Domestic steel companies did not operate during the war years. For this reason, it was cheaper to buy than to produce.

China is naturally not a big customer of the United States. The largest customer of American scrap steel is actually Japan.
Even after 1937, when China and Japan officially started a full-scale war, Japan was still able to import large quantities of scrap steel from the United States to produce weapons.

Although the United States treats China and Japan equally and sells to whoever buys, due to China's metal processing capabilities, it is reluctant to recycle the steel it buys. In fact, this is a great help to Japan.

The rapid development of Japan's military industry is closely related to the large amount of excess scrap steel in the United States.

The American steel industry during this period was somewhat similar to the Chinese steel industry in later generations. When demand was good, everyone expanded production.
Especially during World War I, when everyone was making a lot of money, the furnaces couldn't be stopped when the demand was bad, and they had to produce even if they lost money.
In addition to the large amount of scrap steel from weapons that was discarded after the end of World War I, the profit from selling a ton of steel produced in the United States is probably only a few dollars, not even enough for a meal.

So they don't care about so many things. They sell steel to whoever buys it. When there is an opportunity for industrial transfer, everyone in the industry is excited.

"That one over there is our Chinese-owned factory, Taiyou Machinery. In the past two years, it has expanded quite a bit and now employs over 30,000 people. In addition to the Chinese, there are also over 10,000 Japanese."

Marshal Mai: "I heard that the relationship between you Chinese and the Japanese is not good."

Zheng Yi: "Skilled workers are still valuable. Japan's society is very distorted and problematic, with a huge gap between the rich and the poor.
In Penang, the wages of skilled workers have already exceeded those in Tokyo, Japan, and Penang also provides talent subsidies.
All technical talents, especially those from Japan, can enjoy discounted housing purchase services.

We also have a special living area for Japanese expatriates. Honestly, Japanese skilled workers feel much more comfortable living here than in Tokyo, so they are naturally happy to come.”

Marshal Mai: "You...are very different from the other Chinese people I know. I thought all of you Chinese hated Japan."

Zheng Yi laughed and said, "I'm not anti-Japanese. You haven't seen it. The Japanese media all call me an old friend of the Japanese people. I'm a true pro-Japanese person."

"Look over there! That's the textile factory that Mr. Toyota and I co-founded. It employs 80,000 people, most of them women, and over 30,000 of them are Japanese!"

There are indeed some media in China that are very dissatisfied with Zheng Yi's use of a large number of Japanese workers, especially the differential treatment and paying higher wages to Japanese engineers. Some of them even criticized him very harshly.

In 1936, the anti-Japanese voices in the country were already very loud, and it was normal for Zheng Yi, a "friend of the Japanese", to be scolded.

However, many public intellectuals in China are like idiots, joining the ignorant people in criticizing, which is very annoying. He brought all the Japanese workers in the machinery field to Penang, isn't this a good thing for China?

If they don't come to Penang to work, then they are working in Tokyo, right?

If they don't build machines for themselves, won't they just build weapons in Tokyo?

If we employ one more Japanese skilled worker, Japan will employ one less skilled worker.

Damn you bunch of public intellectuals, you are useless except for cursing. I am really fighting against the Japanese.

Of course, this was also a gamble. He paid these Japanese workers high wages, betting that they would stay in Penang and spend their money, and bring their wives and children over.

If they remit all the money back home, it will become Japanese foreign exchange, so it’s actually a gamble on whether they spend more money locally or remit more money home.

Isn't this giving them housing benefits just to trap them in Penang?

Japan's social structure in the 30s was extremely distorted. The upper class aristocrats and businessmen made huge profits, but ordinary people lived a life worse than dogs.

The vast majority of Japanese people have to farm outside the city in the summer and go into the city to work in the winter. They are even required to pay taxes both when leaving and entering the city. After deducting rent and taxes, the annual income is often not enough to support the whole family.

This is the case for people living relatively close to Tokyo. The income of Japanese farmers in remote areas working in Japan is not even enough to make a living, so young men and women have to go to Southeast Asia or even work in China.

Before 1937, a large number of Japanese came to China, mainly to work in Shandong Province. To Zheng Yi, this was simply a ghost story.

This is also the reason why there are so many Japanese immigrants in Southeast Asia.

The extreme poverty of the lower classes of society is actually the main reason why the Japanese are going crazy in this era.

When the gap between the rich and the poor in any country reaches a certain level, it will inevitably explode. It will either implode internally and undergo revolution, or, like Japan, embark on the path of militarism.

Because in Japan, the only way out for the lower class people is to join the army, and if they want to live a good life as soldiers, they must fight.

In fact, if their upper class was willing to give a little bit of slop to the lower class people, this country would not have embarked on the path of madness, perversion and self-destruction.

These Japanese technicians could not even afford to eat and wear clothes in Japan. When they came to Penang, they were paid high wages, lived in big houses, had one day off every week, and the management was more humane. At least no one slapped them in the face.

If this is the case, when the Sino-Japanese war breaks out, these leeks will still be willing to respond to the so-called national call and return to their country to volunteer to be slaves who cannot even guarantee food and clothing.

Then Zheng Yi could only say that the so-called patriotic education of the Japanese was awesome, and he was convinced.

But then again, even if there are such patriotic Japanese, do they really think that they can come and go from Penang as they please?

"And here, Marshal, you must recognize that sign."

"British... Royal Machinery? Royal Machinery also has a branch here."

"Is Penang also forming an army? The 80,000 guns I just mentioned were mostly produced by the Royal Machinery. Penang is a British colony after all, and its army equipment is almost all British."

Marshal Mai naturally knew what Zheng Yi meant. After a little thought, he said, "British guns are all rubbish. I will help you with this matter.

As for small arms, I'll get you as many as you want, just place an order. I'll make appointments with the heads of Colt, Winchester, Springfield Armory, Marlin, and I'll handle the situation with Congress for you."

"Professor Zheng, you are a rare and intelligent person. I hope we can have a pleasant cooperation."

"Of course, I promise that our cooperation will be very pleasant. Marshal, as long as you give the nod, the US Air Force base project will be launched immediately. We will start leveling the land, building dormitories, and ensuring water and electricity supply tomorrow."

"At the same time, my partners will naturally help coordinate your country's air force. The entire air base will remain under your command until the day when this air base is truly completed."

"Marshal, please do me the honor of coming. I will arrange for all my partners in the United States to come and witness this event."

"Finally, it's these factories. I can make the decision and sign an agreement under your leadership.
That is, the high-quality fuel produced by these refineries in Penang will be supplied first to the U.S. Air Force and Navy, especially the Pacific Air Force.”

"As for the price and purchase method, Marshal, please identify a company you trust to purchase it on your behalf. You decide how the oil will be purchased and ultimately delivered to the military. As for the price, I'll follow your lead."

Marshal Mai couldn't help but laugh when he heard this: "I knew that as such an outstanding scientist like you, Professor Zheng, you must be an extremely smart person."

(End of this chapter)