Tuesday, August 3, 2010

Chinese Bus That Goes Over Cars!

There has been very little innovation in the transportation industry in America. As Walter Block can most assuredly tell you, it is because of the government involvement in the industry. When government gets involved, they tend to prop up the old. That's where the votes are and where the elite tend to cluster. In addition, government involvement in an industry tends to distort innovation since it becomes much more politically complex to bring a new product to market, if not impossible, especially new products that will have any impact on the current structure of an industry.

With this as background, it is easy to understand why innovation in the transportation industry is coming out of China rather than the United States. China is in many ways much more free market oriented than the United States, these days.

And, serendipity has just taken over to support this point.

Because the link below is to a  video that is in Chinese, as are the subtitles, I could not understand the details of what was going on in the video, and since I am travelling the first part of this week, I happened to be watching this video in the lobby of my hotel.

I thought to myself that what I needed was a Chinese person to pass by and translate for me. I looked up and at that moment a young Chinese woman walked over to a group of businessmen. I went over and asked her if by chance she spoke Chinese. She did. With apologies to the rest of the businessmen, I brought her (Cheng-Hsia Lee) over to my laptop. Lee translated the video, and the only thing of significance that you can't understand by simply watching the video is that the gentleman in the video discussing the bus is the inventor,  Song Youzhou, chairman of Shenzhen Hashi Future Parking Equipment Co., Ltd. and that it costs about 500 million yuan to build the bus and a 40-km-long path for it, which is only 10% of building an equivalent stretch of subway.

 Construction for the first bus will began in Beijing’s Mentougou District, at the end of this year.

I then asked my impromptu translator what she did for a living. Lee told me she is a computer programmer. We then started discussing the bus and she said that such a bus would be valuable in Beijing, Shanghai and New York City. Then she stopped and said that it would really only work in China and not New York City. I asked her why. She said that in China, all you need to implement a project is one approval from government to launch a project and nothing else is required. Once you have one government approval nothing can stop you, she said. She then said that a project like this bus in New York City would require a multitude of approvals. Lee said factions representing different groups would start fighting each other and the project would never get off the ground.

And there you have it, a sort of global street level view of why more innovation in key sectors is going on now in China rather than in the United States. Less government red tape.

Check out the video of the cool innovation here.



  1. I'm impressed. This is an idea so cool and so simple, it makes me feel stupid that nobody ever thought of it until now.

    Walter Block was right. :)

  2. I think Wenzel is secretly competing with Roubini for most women from around the globe "charmed" by an economist.

    In the name of free markets, keep it up, my good man!

  3. This is an idea so simple, and yet so useful... Its great.