It Could Happen Here - Worked to Death: Temu Comes to America

Episode Date: February 27, 2024

Mia and Gare discuss the harrowing and deadly labor exploitation that brought Temu to America.See omnystudio.com/listener for privacy information.

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Listen to Better Offline on the iHeartRadio app, Apple Podcasts, wherever else you get your podcasts from. On Thanksgiving Day 1999, five-year-old Cuban boy Elian Gonzalez was found off the coast of Florida. And the question was, should the boy go back to his father in Cuba? Mr. Gonzalez wanted to go home, and he wanted to take his son with him. Or stay with his relatives in Miami? Imagine that your mother died trying to get you to freedom. Imagine that your mother died trying to get you to freedom. Listen to Chess Peace, the Elian Gonzalez story, on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

Calls on Media. Welcome to Take It Up and Hear a Podcast featuring a sound-activated strobe light that you can't see because this is not a visual podcast unless you have like synesthesia and you could like start hearing seeing the strobe through our voices in which case good for you wish that was me yeah so that that's garrison uh i'm mia we're back again we're back again for a descent into hell yeah so so last episode we talked about colin huang and the rise of pdd which is china's second largest shopping app and the chinese version of the app temu so we're now in the post colin huang era an era I think actually might be worse than the original era, which is kind of stunning. But, you know, here we are.

Here we are. And this era actually starts really well for PDD. This is like 2020, 2021. China's lockdowns are actually incredible for PDD because as we talked about last episode PDD strategy is group shopping right it's about getting a bunch of people to buy things together to make it cheaper this thus pulling in more and more customers now China had real lockdowns and in a real lockdown this is increasingly how people got food you know the strictness of the lockdowns vary across like depending on what province you're in right but like so like my family was in inner mongolia and in inner mongolia in like the first lockdowns you could send you could only send

one member of your family outside per week to like you know to go get groceries otherwise everyone else fed all times has to stay indoors and this meant that people started pooling together to like all buy groceries and then sending one person out to like go pick up the delivery and this this ingrained pdds like fundamental strategy of like buying into the into the consciousness of the chinese public because they've just been doing it for like a year right and as 2020 sort of roared on pdd like skyrockets um this this is this the period from like 2020 to like 2024 has been the period where PDD has grown the most. I mean,

it was already pretty big before then, but now, you know, it's, it's now like the main competitor of Alibaba. It was like the previously unassailable, like online shopping giant, the company grew so much that it forced the other like shopping companies to

get into the fruit market because it was like clobbering them there so badly so yeah it was wild but then a bunch of absolutely terrible stories broke about pdd in both the chinese and american press so we're gonna start with the stuff that's i guess less bad and then it's gonna get worse. So, question number one. Is the PDD app malware? Ugh. Alright, we're just really jumping right in

here. Oh, this is the mild shit. This is the... Are we allowed to say this legally? Yeah. Well, here's the thing. So, Google Play removed the app from its Play Store. Oh, okay. So, okay. We need to be very specific about what we're

talking about here. If it's too bad for Google, then it's probably too bad for us. Yeah, so very specifically, the thing we're talking about right now is not Temu. We're talking specifically about the Chinese version of the app PDD. And this was released on the Google Play Store in the mid-early, I think it's like 2021 or something and okay so this again and to be clear again this is not

temu this is specifically the android version of pdd and this is interesting too because so most people in china like don't use android or sorry they don't they don't you they don't use google play right like they they don't that that's not like the app store where they get their apps from so when pdd released like their app on the app store this is this is them specifically going to the western market and did they have infrastructure set up in the states to support this type of like drop shipping or like how does yeah uh we'll get into it it was like kind of a little bit like gig economy stuff in china but how how are they gonna move that phoenix yeah okay yeah all right well we'll get into that

more later we talked about temu this first one didn't like it didn't have that many users because it was just like the chinese app but like here okay so okay there's something we also we need to get out of the way first which is that there's like a massive panic in the u.s about chinese apps being like chinese government trojan horses like especially tiktok so unfortunately before we start this we have to sort out kind of or like you have to make a judgment about what level of app surveillance is like the level of app surveillance you get in the u.s because all of your apps are spying on you and then what is like above and beyond the like quote unquote normal level of spying and like tiktok is tiktok is unbelievably invasive right like it is true it's a privacy nightmare but like so are most apps like tiktok's worse than normal but it's not but tiktok is run by the chinese communists so so this is something

we're gonna get into and this is this is true with pde too um the us actually gets like the stripped down cucked not as bad version of chinese apps like tiktok does not have a bunch of the like integration stuff that that uh doyen the the chinese like version of it has where like doyen has this thing where like i guess google's kind of doing it now but like you can directly like like influencer can hold up a product and you could tap the product and go buy it google is trying to do that now yeah but china had that like like doyen's had that for like ages right it's like so like the the versions of the apps that we get here are actually less bad than the Chinese ones which makes the whole panic so funny to me it's like no no like they're sending you like a better version of the app like well that's because when uncle

Sam calls in our version we have to take out all of the Maoist influences I don't know whatever whatever so all right all right so you know look like so we have to we have to sort out the difference between stuff that's just like the weird moral panic and what what's actually malware so cnn did an investigation of this app so originally there was a chinese company that a chinese security company was looked at this app and was like they're using a bunch of android exploits like they're like they're using like they're they're effectively hacking your phone right they're they're they're deploying a bunch of exploits of things that are like broken in in like in android and allowing you like this like lesson do stuff they're not supposed to be able to do and so cnn brought in a bunch of

different security like analysts and like they brought in security companies like look at it and here's what they found well i don't know if you would trust the cnn they're literally called the communist news network the app was able to continue running in the background and prevent itself from being uninstalled which allowed it to boost its monthly active rate uh hyponet i don't know how to pronounce this guy's name i'm so sorry this guy this guy's this guy's name has an umlaut over the o i'm an expert at pronouncing foreign names give it to me let's get it's h-y-p-p umlaut o-n-e-n good luck you know what i'm just gonna take a i'm gonna take a sabbatical

i'm so sorry to this guy who I think is fine. This guy's a security analyst, said. It also had the ability to spy on competitors by tracking activity on other shopping apps and getting information from them, he added. Toshin, which is another guy, found PDD to have exploited about 50 Android

system vulnerabilities. Most of these exploits were tailor-made for customized parts known as original equipment manufacturer code, which tends to be audited less than ASOP, which is like another kind of code, and therefore prone to more vulnerabilities, he said. PDD had also exploited a number of AOSP vulnerabilities, including one that was flagged by Toshin to Google in February 2022. Google fixed this bug in March, he said. I've never seen anything like it. It's like super expansive. Sergey Toshin, Android security expert, is the guy who said that. Sorry.

I've never seen that. And Android Toshin said, I've never seen anything like this. It's like super expansive. According to Toshin, the exploits allowed pdd to access users location contacts calendars notification and photo albums without their consent they were also able to change system settings and access users social media accounts and chats he said now that is pretty bad i will i will mention that like a lot of your normal apps can also do shit like that yeah like that's stuff that you can get out of like google but some of it's not good the other thing that they were doing is they're doing these things called privilege escalation attacks where they're trying to get like a higher level of privilege on the system so they can run code they're not supposed to be able to so you know how like sometimes when you're running something on a computer you have to run

it as admin so the thing actually works. Yeah, like Discord. Yeah. Actually, Discord? I've been trying to stream Alan Wake 2 to my friends, and oh my god, it has been such a nightmare. I'm going to personally write the CEO of Discord a letter. Yeah, but like, so like,

the way that system security works is there's certain levels of users that are allowed to do certain things and certain people who aren't, and this is supposed to stop people from running malicious code. And so they're doing these privilege escalation attacks where they're trying to be able to like do stuff that only admins can do.

And so I showed this to, so I was trying to get a gauge on how much of this is real and how much of this is insane. And so I showed it to my friend who's a software engineer and he was like what the fuck so this is a this is very specifically the privilege escalation attacks on the in the attack on the like the original equipment manufacturer code like oem stuff that's just not normal like that is that is actual malware that is like not that is not normal app bullshit like this thing is trying to hack your phone so in 2023 the like google pulled the app from the store because everyone was like what

the fuck wait this is just literally malware i'm gonna i'm gonna so what were they trying to do here's cnn again it was in 2020 according to a current pdd employee that the company set up a team of about 100 engineers and product managers to dig for vulnerabilities in Android phones, develop ways to exploit them, and turn that into profit. According to the source, who requested anonymity for fear of reprisals,

the company only targeted users in rural areas and smaller towns initially while avoiding users in megacities such as Beijing and Shanghai. The goal was to reduce the risk of being exposed, they said. By collecting expansive data on user activities, the company was able to create a comprehensive portrait of the user's habits, interests, and preferences,

according to the source. This also allowed it to improve its machine learning model to offer more personalized push notifications and ads, attracting users to open the app and place orders they said so this all makes perfect sense with like how we know that pdd operates right like you know they're trying to build detailed profiles of rural customers like you can serve them more efficient ads and they're doing it by apparently just straight up running an in-house hacking team like a pretty large one so they supposedly that team got like axed and they don't do it anymore,

but who knows? So, okay. This is not even close to the most bat shit thing that PDD gets up to. Okay. We're going to escalate up the, how weird this stuff is. So one of the things that,

that PDD has a six tontone reporting is that they have these really strict non-compete clauses that prevent people from like, so if you take a job here and you get fired or you leave, you can't take another job at a tech company for like two years. This is like fucking any tech company.

They're really expensive. Fucking setting up your grandma's website might get you in trouble. It's a real it's a real disaster we have these in the us too and they absolutely suck so i think there was a ruling about them an ftc ruling to ban them recently maybe oh no they're proposed i don't it hasn't gone through yet no they are trying to get rid of them but yeah they're still in the us too but these ones are really strict and apparently they're like pdd is really aggressive about to the point where like people people will take other jobs under fake identities and like pdd's hr will like track them down oh wow yeah like they're

like headhunting these people well i like like inverse headhunt like they're like they're literally just hunting down people trying who are to get jobs, right? And this apparently led people to adopt secret identities to hide, right? And so this gets to something I did not believe the first time I read it, which is that apparently, and I originally read this in Nikkei, which is usually reliable,

but I read this and I was like, no way. The thing that they said was that employees at work who work for PDD apparently use pseudonyms and almost never tell each other their actual names. That makes sense. And apparently also

they're banned from the level of information control is so strict that you're not allowed to know what the structure of another work group is. I read this i was like i don't believe this right and then i started running into like other outlets like financial times was like yeah no no apparently they they talked to the time they talked to people

who work for the company they're like yeah everyone uses pseudonyms i didn't fucking know anyone's real name or like there was like one person whose real name that i know wild i don't know why they're i've never seen i've literally never seen this before with any company i it's it's fucking nuts i got nothing yeah i do you know who no one at this company knows my real name so that's true i i do actually operate by pseudonym yeah that is not unlike a sizable portion of the cool zone media team but all of us are fake names robert evans that's not robert evans the real robert evans it was the producer of that movie yeah yeah yeah yeah yeah anyway do you know who also has trustworthy names that you can trust these products. Woo! I found out I was related to the guy that I was dating.

I don't feel emotions correctly. I am talking to a felon right now and I cannot decide if I like him or not. Those were some callers from my call-in podcast, Therapy Gecko. It's a show where I take real phone calls from anonymous strangers all over the world as a fake gecko therapist I live with my boyfriend, and I found his piss jar in our apartment. I collect my roommate's toenails and fingernails. I have very overbearing parents.

Even at the age of 29, they won't let me move out of their house. So if you want an excuse to get out of your own head and see what's going on in someone else's head, search for Therapy Gecko on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. It's the one with the green guy on it. Hey, I'm Jack Peace Thomas, the host of a brand new Black Effect original series, Black Lit, the podcast for diving deep into the rich world of Black literature. I'm Jack Peace Thomas, and I'm inviting you to join me and a vibrant community of literary enthusiasts dedicated to protecting and celebrating our stories.

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Listen to Blacklit on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. Curious about queer sexuality, cruising, and expanding your horizons? Hit play on the sex-positive and deeply entertaining podcast, Sniffy's Cruising Confessions. Join hosts Gabe Gonzalez and Chris Patterson Rosso as they explore queer sex, cruising, relationships, and culture in the new iHeart podcast, Sniffy's Cruising Confessions. Sniffy's Cruising Confessions will broaden minds and help you pursue your true goals. You can listen to Sniffy's Cruising Confessions, sponsored by Gilead, now on the iHeartRadio app or wherever you get your podcasts. New episodes every Thursday. so true jeff wow that was a really funny joke bill oh we're back sorry i was just talking to the two fake fake name people who are listening in on our call right now

me i continue so this is where we get to the truly bleak stuff stuff so all right in 2021 one of pdd's employees in xingjiang just worked worked a shift came home and just straight up fucking died in her bed from overwork this this was a you know this very quickly turns into a giant media thing because this woman like she's in she's in really good health and she just fucking is worked so hard that she lays down and ben dies then a worker who posted a video of an ambulance outside of pdd's headquarters with the caption another brave warrior of pdd has fallen which great caption terrible situation great caption he gets fired for it and then very quickly like after that so they have like a uh the company has like a q a thing like it's effectively what happens is someone responds to like one of their social media accounts with and asks them uh what do

you think of the pdd worker who died after working overtime should pdd bear responsibility their corporate account responded and i quote look at those in the underclass who isn't exchanging life for money i never thought of this as a problem of capital but as a problem of this society we live in an era where we spend our whole lives working hard you can choose a comfortable life if you accept the consequences of comfortable living. People control how much effort they make. Everyone does. I can't believe there's people who genuinely advocate that China is a communist country. So deranged.

That's insane. They're literally talking like this. Oh my god. that's insane they're all fucking like this like god this is this is like this this is like and this is like this is one of the things that like i just like i don't know like i i just can't fucking get over this shit because like i have a bunch of fucking family in china and you know do they fucking quote carl marx no they quote steve jobs because they're all these like fucking insane entrepreneur bullshit like like fucking literally like grind set like work until you die by your bootstraps yeah it's insane it's like no it's your fault that you work too hard this is actually labor's fault and not capital like

this this fucking blew up in the chinese media people got like people got really fucking pissed and pdd at first was like no this is a fake post we never did it and then people got like people got really fucking pissed and pdd at first was like no this is a fake post we never did it and then people were like no no it's not this is we found the post right they take they take it down people like had saved screenshots and eventually the company was forced to admit that it was actually their account but then they said that it was a social media contractor who put it on the corporate account quote by mistake oh sure sure yeah that's so that's like me when i search my uh twin peaks not safe for work uh fan art on the cool zone media account it was a mistake guys didn't mean didn't didn't mean to post it there i don't know how that

happened it got it got past the mods i don't know how yeah and you know people people understandably are not happy like and then 11 days later a pdd employee jumps off a fucking building again also because they've been worked so hard and this this is where we need to talk about pdd's labor conditions because they are fucking appalling. Here's Sixth Tone. A former PDD employee who left the company a year ago told Sixth Tone under conditions of anonymity that excessive work hours are common practice. Around eight months after he joined PDD in early 2019, he said employees were told they need to work at least 300 hours per month, He said employees were told they need to work at least 300 hours per month, amounting to nearly 12 hours per day, six days a week.

We're going to get more into that. That's a schedule called 996, where you work from 9 a.m. to 9 p.m. six days a week. This is incredibly common in China. This is actually a good schedule in a lot of Chinese work environments. It can get way worse than that. Here's another quote from that Six Tone article. The company cares a lot about our work hours. It has become company culture.

Even if staff has finished working, they'll just stay in the office. I was one of the lucky ones. I only had to work from 11 a.m. to 10 p.m. And my manager was nice to me. This person added that employees arriving after 11 a.mm would have their daily wages docked by three hours it's fucking insane it's it's nightmarish um that same worker talked about how she would like and this is this is a thing that's like you see you see this a lot of different accounts is that people would just literally break down

crying at their desks because they had so they were so overworked so are are these like office jobs these are fucking office workers these are tech workers these are fucking tech wow like right the these are the fucking bougie tech jobs they're not like because they're getting over right in like a factory or like an amazon warehouse these are fucking tech workers and this this is the thing about this right is that like we we only we don't like there hasn't okay so the chinese media this actually like becomes a huge thing in the chinese media is that these people are dying there was another there's also around the same time a delivery driver lit himself on fire like as a protest for like the amount of shit that he had to deal with and this was a big like a huge thing

in in the chinese media but almost all of the reporting and the coverage and stuff like that was about the tech workers. But like fucking so many people work schedules that are worse than 996, right? Like that is a, that is a, that is a tech worker schedule, right? There are a lot of places where people were fucking way worse shit. The sort of countervailing force to it is people who like, you know, we talked about this kind of in the lying flat episodes, people working for like one day and then eating just like plain rice with some,

like whatever fucking the cheapest thing they can find, they can fucking get out of it and not working for two more days and working another day. But like, it's, it's so bad. Like the labor conditions are just appalling. And, you know, like, a bunch of stories sort of started coming out about how bad PDD's, like, conditions are.

There was one on WeChat that broke that I saw via SixTone about the toilet situation in PDD's largest office building. So this building has 1 000 people per floor it has eight total bathrooms per floor 1 000 people they don't even have one bathroom for every hundred people how does this even function i mean like i i suppose it just doesn't people are like people like people people fucking like you don't eat in the morning or you try to hold out to lunch when you can run to a different building and try to use the bathrooms there but like you know you're trying to hold it all day or you just yeah or you fucking do that you go you go you you use your lunch time instead of eating

to fucking go somewhere else. You starve yourself. There are like, there's a bunch of reports of guys just like shitting in urinals because there just literally wasn't time for them to fucking actually like use a stall. So they're just like, they're just like they're, they're pooping in urinals.

Maybe the worst picture I've ever seen in my entire life is this is going to be the episode r pdd started installing timers over the toilets to show how long how long people had been there so there's just like a like a a fucking clock over you that starts when you when you fucking close the door to try to get people to go to the bathroom faster it is just appalling the conditions and again these are the conditions of the office workers. It's apocalyptically bad.

So I realized when I was researching this story that I actually ran into PDD earlier. Before I did this story, I hadn't looked into Temu at all. And I realized that I had ran into PDD earlier when I was tracking the story about uh tech workers banding together to like basically like on github these these uh office workers like

tech workers like made a giant spreadsheet where everyone would document their hours and like their pay scales and stuff and it was like you know it was this sort of like you know it was it was this thing to like demand better labor conditions actually i'm pretty i'm pretty sure they were actually demanding workplace democracy too. It was pretty wild. But the thing that you get out of that is that PDD has the worst, the worst hours of any tech company.

PDD is so bad that other Chinese tech companies got worse in order to compete with them. Yeah, I mean, that is the hard thing about setting the bar so low is that it allows other people to lower their own bars. Yeah. Yeah.

And it makes just every, everybody worse. Yeah. And again, like I can't emphasize enough the extent to which these are the office workers, right? Like these are the people who are making the best money out of this,

who are treated better than like the fucking factory workers and the fucking like people in the rural areas like fucking doing farming right but again we don't we don't know a huge amount about what those workers lives are like because they're not urban tech workers and urban tech workers can get their stories into the press but like you know migrant migrant factory workers rural workers there's you know there's just not the kind of attention that you can get out of a big story about like an urban office building and you know i mean these labor conditions are so bad that people are just straight up fucking dying and the chinese government eventually gets involved like their their their version of the supreme court eventually rules that like working people 12 hours a day six days a week

is illegal but it doesn't really matter like a lot of those people still have those same schedules yeah and you know and like this this is not a this is not a problem that can be solved just by like court rulings right so yeah it's it's really fucking bad um we're gonna we're gonna take an ad break i don't i don't have a good transition out of that shit i found out that was related to the guy that i was dating i don't feel emotions correctly. I am talking to a felon right now, and I cannot decide if I like him or not. Those were some callers from my call-in podcast, Therapy Gecko. It's a show where I take real phone calls from anonymous strangers all over the world as a fake gecko therapist and try to dig into their brains and learn a little bit about their lives.

I know that's a weird concept, but I promise it's pretty interesting if you give it a shot. Matter of fact, here's a few more examples of the kinds of calls we get on this show. I live with my boyfriend and I found his piss jar in our apartment. I collect my roommate's toenails and fingernails. I have very overbearing parents. Even at the age of 29, they won't let me move out of their house. So if you want an excuse to get out of your own head and see what's going on in someone else's head, search for Therapy Gecko on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

It's the one with the green guy on it. Hey, I'm Jack B. Thomas, the host of a brand new Black Effect original series, Black Lit. It's the one with the green guy on it. dedicated to protecting and celebrating our stories. Blacklit is for the page turners, for those who listen to audiobooks while commuting or running errands, for those who find themselves seeking solace, wisdom, and refuge between the chapters. From thought-provoking novels to powerful poetry, we'll explore the stories that shape our culture. Together, we'll dissect classics and contemporary works

while uncovering the stories of the brilliant writers behind them. Blacklit is here to amplify the voices of Black writers and to bring their words to life. Listen to Blacklit on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. Curious about queer sexuality, cruising, and expanding your horizons? Hit play on the sex-positive and deeply entertaining podcast, Sniffy's Cruising Confessions. Join hosts Gabe Gonzalez and Chris Patterson Rosso as they explore queer sex, cruising, relationships, and culture in the new iHeart podcast, Sniffy's Cruising Confessions.

Sniffy's Cruising Confessions will broaden minds and help you pursue your true goals. You can listen to Sniffy's Cruising Confessions, sponsored by Gilead, now on the iHeartRadio app or wherever you get your podcasts. New episodes every Thursday. And we're back. So all of this brings us to Temu and its slogan, Shop Like a Billionaire. So... Oh God, this the slogan it's so it like it evokes like a like a nauseous reaction in me yeah it's so it it epitomizes everything that is wrong about our current way of living um and the way we idealize the rich and put them on this like pedestal for how you should live your life. But also knowing that you will never actually be there.

This is, this is, this is as close as you're going to get. And it's, it's, it's also a thing where like, it's, it's a completely unreal,

like it's, it's, that's, this is a now fucking billionaire shop. Like billionaires. it's not like, like you think those people fucking shop? Like,

no, no, they don't. They have, they have fucking people for that. over like saving $3 on a, on like a mango. You fucking shop like no no they don't they have they have over like saving three dollars on a on like a mango you're like no yeah like what the fuck are you talking about yeah so yeah like i i hate it i hate it so fucking much um you know so as we said like this is the time is the american version of pdd um if you're in the u.s you've probably seen tamu as apparently they're not that many of them in, like, other countries.

Like, I have British friends who are just like, what the fuck are you talking about, Mia? I've never heard of Temu before the Super Bowl. For whatever it's worth. The big place where they were advertising was YouTube. But if you're watching YouTube without an ad blocker, don't. I can... I don't know if I can legally recommend New Pipe. Probably not.

It's on your phone. I can get it. It's an app. I don't do it. I don't know if i can legally recommend new probably probably that's on your phone i can get it it's an app i don't do it i don't know if it may be legal it may not be i can't say i will never advocate breaking the law no definitely by youtube yeah yeah yeah that's definitely the way to go absolutely but you know so like they okay like most famously yeah as you're saying like so they spent $27 million buying three Superbowl ads. It's all the same ad and it sucked. But, you know, okay.

This is only a fraction of their fucking budget, right? Here's from the Wall Street Journal, quote, Temu's marketing budget reached $1.7 billion in 2023. And that figure will grow to nearly $3 billion in 2024, JP Morgan's analysts estimate. Last year, TenMu's marketing spending contributed to an average loss of $7 per quarter, according to Goldman Sachs estimates. They are buying so many ads.

They are literally driving other companies out of the ad market. Like, NCC Yo has been talking about how they can't afford to run ads because ads are getting too expensive because they're buying so many fucking ads here's reuters quote u.s companies dependent on commercial spending uh or spending on commercials not commercial spending they are buying commercials yes yeah like uh facebook they say meta i refuse to fucking call that company meta like fuck that shit their facebook are being saved by chinese retailers like temu and shian they represent 10 per those two companies just temu and shian represent 10 of meta's revenue last year the

facebook owner said so temu is hemorrhaging money right now in order to do this right jp morgan thinks they're losing 3 billion a year but they also project on and to be fair these projections these projections are wrong so many of the time of so much of the time but they're projecting that 10 will be making 3.5 billion a year in 2027 and all of this raises the question why why? And to answer that, we need to get into Chinese development economics. So the Chinese economy has a problem. And this is a problem that the CCP has known about for a long time. It's the problem of turning a sort of like a low on the value chain, like manufacturing economy into a consumption driven economy.

Now, the problem with transitioning into a consumption driven economy is that people don't have enough money to boost consumer demand. The Marxist way of saying this is that under capitalism, both output and consumption are double determined by your wage, right? Your wage determines both firm output and also how much you can consume right in non-marxist terms oh no no one has enough money to buy things in your new consumer economy my brother in christ you set the wages okay thank you for explaining that where the fuck are these people supposed to be getting money from to buy your shit if you won't give them more money like wait wait wait so you know you can't do this by just making them like work more hours you know you can work people for like 12 15 like 20 hours a day but there's only 24 hours a day like there's an actual definite there's an actual definite limit to the amount of exploitation you can do via increasing labor hours this is this has always been capitalism's problem right like the the sort of rapacity of capitalism has hit the secular limit of time itself so the solution to this is to expand into new markets where consumers have

more money which is to say the u.s so pdd initially targeted like poor rural chinese workers right and this is kind of the same group that temu is targeting in the now in the u.s um their initial base is people who like buy dollar stores, but they've been spreading rapidly. Temu has outpaced Xi'an to become the second largest shopping app in the US. But the important thing... Really? Yeah. They're second behind Amazon.

Yeah, they're destroying Xi'an. Wow. I did not know they were that popular. I mean, estimates are like... I've seen estimates that say they have 100 million users. don't buy that i've seen that the estimates that i think are more reliable are like 54 million users in the u.s although well the thing is we don't we don't have post super bowl numbers between 50 and 1 well i think i think it's more like 50 i i wouldn't i wouldn't accept 100 million ones i think that's bullshit we don't have good post super bowl data

yet sure kind of the issue but yeah they're yeah, they're clobbering people. But the important thing about specifically the American market for Temu is that the equivalent person who shops at a dollar store in the US still has unfathomably more money than that same person in China. Because partially this is because of the strength same person in china because partially this is because the strength of the american dollar partially this is because american wages are just like unfathomably higher than chinese wages and that that's that's that's true even if you're like

even when you account for like the relative strength dollar to the yon so you know um and the the other kind of important thing about temi strategy is that they've been using this kind of like loophole that was set up in U.S. customs law to allow people to like bring presents home from countries. So like if you go to another country and you bring a present home, it's worth less than $200. You go through like an expedited customs thing. You don't have to pay tariffs on it. Yeah. it yeah so i am so temu and like a whole bunch of these companies just ship every single one of their packages in in quantities where it's like 799 dollars not 800 dollars is that legal yeah yeah yeah and it's really funny it set off this like it's massive intra-capitalist war because

like a bunch of like like american right-wingers like american manufacturers like the republican party like we need to close this gap but then all of the fucking shipping companies are like no this is a vital part of the american consumer economy and there's this like giant war going on like both in congress and like in the like in in the press over whether they should which they should close this loophole now you know on the other hand like there are real challenges to temu being the first like company to break into the they're like chinese companies like really truly break into the american market like sheen has done well but they haven't like they have they have they're not like a rival for it to amazon right like they're not big enough to like knock off one of the sort of like american tech giants and temu's problem is that okay so if you compare temu to to pdd right the chinese

version pdd is supposed to be about spreading through word of mouth right it spreads by like someone in your you know you as a as someone buying something for pdd taps your entire friend group and your family to get them to buy something for cheaper right but the problem is that like fucking night i just i forgot how great marish this whole structure is it's so bad but the thing is like americans don't really do that like there have been attempts to do like groupon things they never worked and americans also don't group shop right because we're i i don't know more weird bourgeois individuals i don't fucking know we're full of a lot more like individualistic impulse buyers yeah that is that is kind of

a large part of uh what the american shopping class is me is is built off of and and this isn't this is an issue for temu because like they don't have the word of mouth thing that drove them in China. So they're relying on just top down, like, like massive ad buys and stuff. And there's kind of a limit. And it's something that,

that Temu understands, right? Like this is, you know, the whole, there's a whole thing in the Chinese tech industry about the power of being able to leverage people's like private networks, right?

Temu understands this, but they don't, they don't have a way to break into the american market because it just doesn't work like the chinese market so instead they're like buying three super bowl ads right now there's another issue which is that the goods that they sell suck ass and they break instantly i you know that's an issue but i don't know it's the the US. Lots of things suck and break instantly. It is something that's been driving negative sentiments from people who've used it. They buy something

and it just sucks and they're unhappy about it. The thing I think is maybe the biggest problem is that their delivery times are really long by American standards. Because they're shipping overseas, Temu had to build an actual logistics infrastructure where PDD didn't, didn't, right?

Because PDD is just using, like, Chinese versions of FedEx or whatever, right? And Temu's kind of doing that, but in order to make it convenient for Chinese sellers, the way that they sort of, like, set this up is they have a warehouse in Guangdong. And every seller, like, ships it to this warehouse and then temu deals with getting it shipped overseas the problem is that this is really slow right it takes like two weeks for things to show up and that's not that slow by like normal standards but this is the u.s everyone's current american standards that is like a tortoise nightmarishly slow because america we we've gotten used to a level I'd say gratification

like yeah like this is a level of power that was previously reserved for like Chinese emperors and we'd fucking use it every day to order fucking nail clippers from Amazon right like or in my case a whole bunch of materials to build a black lodge

which I will then return as soon as my party is over incredible you know and this is this is a this is also something that's kind of new for temu because pdd was built on being able to on doing sales or a fast enough they could sell fruit to people right do you know how hard it is to sell fucking fresh fruit to people that's like it's legitimately really difficult. Well, yeah, you can't you can't ship, you can't have a two-week ship for mangoes. Well, you can, but

it's, well, you have to do a bunch of, you have to have an actual logistics infrastructure set up for it, right? You can't just ship it in like an Amazon box. They have to be, they have to be like specifically ripening along the way. Yeah, yeah, yeah. And, and, and Temu's also up to do that, right? And this is, and this is an issue with all of their stuff because, you know, They have to be specifically losing money on the sales. And most of the money they're losing on the sales is from their ad spending, not from the actual sales. And this is where you get into, again, the really bleak part about this, where, okay, so why are these prices so low?

And part of it's tech money subsidy, but a lot of it is just labor just pure pure unrivaled labor exploitation you know when with with the chinese workers movement like as like a a sort of like collective mass movement just completely broken by tiananmen and then again during the like the crackdown through the 2010s that wiped out whatever sort of classical workers' movement style thing may have popped up from the strikes in 2011, there's no mass countervailing force in Chinese politics to try to raise wages. you will get arrested the actual unions that exist like the all china union federation doesn't do shit we don't really have that kind of like fake union thing here it's like it's like a different but you know like they're they're i don't know this is this is this is maybe not the time for me

to try to explain china's union system like the unions are fucking bullshit they don't do anything like if you go to them and be like my wages are too low they'll try to get you to like negotiate with the company directly right like like as an individual. They're nonsense. They're completely useless.

And the result of this, and the result of just the incredible poverty of the Chinese working class, and the fact that a lot of Chinese migrant workers, who are the people who are actually making these goods, some of it's rural workers, some of it's migrant workers, but a lot of these people's wages are lower than they otherwise would be because they're drawing revenue off of like they're off of off of like the plots

of land that their family has like back in the countryside when they like when they they like migrate to another city to find a job yeah so like all of these factors are just institutionally like smashing the price of like like smashing like wages and there's no, there's no fucking, there's not, there's nothing really there to resist them and, and act like, you know, it's not like the Chinese working class, like completely takes it lying down. Right. But it's like their resistance strategies are trying to work as little as possible, but that doesn't, that's, you know, and that's something that can be very effective in the sense of like you're working a lot less but it's not something that drives up like wages and so when when you're looking at temu and you're seeing a pair of jeans for two dollars like what you are seeing is the raw exploitation of the chinese working class and this is also true of like the rest of the fucking shit you buy from China, right? Like almost all of the price of like a shirt that you're buying. I mean,

it's Chinese textile manufacturing is kind of like not what it used to be. Right. But like, you know, but like you're, you're buying like fucking some bullshit from China. Like if you're buying from like another drop shipping company, right?

Like the thing you're actually paying for, you're paying the drop shipping company you're not fucking paying the workers they're not they're fucking not making shit all like all of the stuff that's like i mean it's not like 100 but like a huge portion of of the fact that the price is higher on non-temu sites is just like it's just markups because this is this is just like, it's just markups because this is, this is just what the Chinese economy is. It's just sort of like, it's, you know, it's,

it's, it's, it's unbelievable exploitation. And this brings us to the thing we're going to end today on, which is does Temu use slave labor? Oh, oh, okay.

And the answer is probably, but it's hard to tell so this has been a big thing because ten was one of the companies that the state department brought up when they were doing their investigations into like like she and was the other one into like are these companies using slave labor and you know this is labor from people put in in in the fucking camps i i think the answer is probably because i mean so the thing is the state department doesn't have any actual evidence right like they're all and they're they're doing this incredibly what we'll get into this in a second but like you know obviously they're doing this because this is like this is an intra like capitalist feud thing right the state department's talking about this because they're pissed at China.

Yeah, this is like a nationalistic project for the United States. Yeah, but, comma, it's also probably true. Because these, like, and this is like the thing specifically with PDD that we've been talking about, is that they don't, and Temu's like, they don't vet the sellers of stuff, right? Like, we talked about last episode that, like, people were selling sleeping pills as date rate drugs, right? They don't fucking vet sellers of stuff right like we talked about last episode that like people were selling sleeping pills as date rate drugs right they don't fucking vet it at all so yeah probably like quite possibly yeah the stuff the stuff that they're selling from xinjiang and they have a pretty large presence there like was using sort of like prison slave labor from the camps there

however comma we can't talk about prison slave labor without talking about the fact that fucking every goddamn u.s firm also uses prison slave labor everyone from fucking mcdonald's to starbucks to walgreens jc penny like fucking every every company every american company you can fucking think of uses slave labor or their slave labor in their in their supply chain and they're using slave labor because in the u.s under the 13th amendment slavery is legal as long as the person as long as the person being enslaved is incarcerated so you know like it doesn't fucking matter like this this is this is the problem it doesn't matter whether you buy from the u.s or china right like you're you're getting fucking slave labor so if you if you want to not do that

you're you're your only option if you do not want to if you do not want everything you consume like the food that you eat if you don't want like everything that you use in your daily life to be the product of unfathomable human exploitation your only option is to destroy the monstrous economic system that reduces humans to commodities and tear up the fucking roots of every single one of these companies from san francisco to shanghai and burn it to the ground that's that that those are your options like it's not your individual consumer choice not going to make it any better that that's what i got i okay all right well god like wasn't the super bowl great this year yeah what a game what a game almost almost double overtime that was crazy i i don't know that was

that was the worst chiefs team of all time and they nobody could fucking beat them we're so doomed we're gonna get patrick where home is gonna win like a fucking 12 pete it's so over for every other sports team better things aren't possible unless you make them possible it could happen here as a production of cool zone media for more podcasts from cool zone media visit our website, coolzonemedia.com, or check us out on the iHeartRadio app, Apple Podcasts, or wherever you listen to podcasts. You can find sources for It Could Happen Here updated monthly at coolzonemedia.com slash sources.

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