The man looks at the symbols on the paper, refers to the instructions printed in the books, writes the appropriate results on another piece of paper, and passes that paper back out through the slot. The man in the room does not understand Chinese. The books cannot be said to understand anything. Nor does the room. It doesn't convince me for a moment.
Many people are convinced, though, and it can lead to strife.
I once overheard an anguished computer scientist mentioning that his girlfriend thought the Chinese Room argument was convincing, and that they'd had some terrible rows about it. For an excellent overview of some of the controversy surrounding the Chinese Room Argument, check out the Chinese Room Home Page . It's part of the PT Project pages at Illinois State University. There are many personal web pages attacking the Chinese room argument, sometimes in strong terms. Andy Ylikoski contributes a more detailed refutation, of a kind which I hadn't seen before.