The Smugglers
It also benefits the people running the scam in the first place.
And the smugglers, don't forget the smugglers.
Yes, they certainly do profit, but they are almost no different than someone running an independent Apple retail store in America, that sells the same products for the same prices they do. The major difference is here in China they have stolen Apples retail store design IP. Wrong, of course. But in Chinese culture, which is wildly different from Western culture, stealing IP is not considered a crime at all. It happens every day in every facet of life in China. They don't think about it morally or ethically like our culture might but only economically. Someone has a good idea that works, copy it and slightly modify it for the Chinese market. It happens EVERY DAY. They have copied everything from IKEA store design to Chilis logo. A quick google search will enlighten you to what the Chinese have copied and modified to appeal to the Chinese culture. From my very small research, China is in the position Japan was in some 20 to 30 years ago. Remember when "made in Japan" was a big joke in America? Now "Made in China" is the big punchline for low quality and cheap production. In my opinion, China is coming into it's own, just as Japan did, and will in time, take it's place in the world as an economic super power, producing the majority of the goods the world needs, and producing them of the highest quality. This will take time however and western technology, quality, and ingenuity will be the main factors that influence change. As China stands alone, they are completely paralyzed due to Chairman Mao, as far as education, free thought, science, art, politics, philosophy, and many other subjects we take for granted in the west are concerned.
Case example. My very educated and unique Chinese girlfriend does a weekly Chinese trivia night here in Guangzhou. Just last night one of her questions was, what is this famous landmark? She showed a very typical picture of the forbidden city in beijing. Possibly one of the most recognizable structures in the world. Of 8 Chinese teams, 3 of them incorrectly named the picture. My point being, the restructuring of China via Chairman Mao set them back many many decades. Free thought is a very foreign concept to the Chinese. They were raised to follow a very strict regiment and that's all they know. Only the basics, Math, language, history (which is wildly biased), and a few other core subjects are taught in school. Imagination and creativity in people is so far and few between due to the system everyone is brought up in, and the existing system which simply copies what is successful in the west.
I have probably rambled on way to much for sure. I guess the final point is, while the smugglers are wrong, they are just doing what they know. They don't have any concept of right or wrong. They are just people filling a need trying to make a few bucks. Don't begrudge them too much, as, if you were in the same position, you may do the same. Don't get me wrong, I am the biggest critic of the way the Chinese conduct their business, but you still have to stand back sometimes and see things from their perspective.
Brian