People need to wake up to the fact that China being a potential market of >1B people is an illusion. This is particularly relevant for any tech company.
Let me spell it out: Chinese companies are extensions of the state. They are tools of Chinese foreign and trade policy. What cooperation you think US companies provide the US government, it is nothing in comparison.
The Chinese government will ensure that no Western competitor will "win" in China. Period. I understand why to a point. My main issue is with the West being completely oblivious to it.
If China wants to impose such restrictions on Western companies, they shouldn't get access to Western markets. And that's it.
Here's where I think this will first come to a head: I believe the US government will at some point soon decide that any person born in mainland China is a security risk as far as working on anything national security related. This will probably extend to key industries of national importance too (eg SpaceX).
> Here's where I think this will first come to a head: I believe the US government will at some point soon decide that any person born in mainland China is a security risk as far as working on anything national security related. This will probably extend to key industries of national importance too (eg SpaceX).
Even naturalization or birth in America can't erase ties to Chinese entities, through family links for instance. Beware of double allegiances. [0]
One of the problems is that Chinese Americans may still have family ties in China, and the CCP's United Front [1] or other orgs will use those ties to extort, blackmail, or otherwise pressure them.
It's absolutely imperative that the US Govt, and the govts of all democracies, recognize and combat this, and take active measures to protect their Chinese citizens.
One thing that needs to happen if it's not the case already, is ensuring the 5th Amendment - no self-incrimination - protects any who want to come forward about such pressure. They need to know there's a legal safe-haven for them to cooperate with the government.
Democratic governments should probably also look into providing an expedited immigration path for their Chinese citizens' relatives still in China.
Right-wingers may complain about this, but they have to understand that: 1) historically, subjects/victims of oppressive govts are more likely to be allies of US and other democracies, rather than enemies, and 2) innocent till proven guilty must apply universally.
> It's absolutely imperative that the US Govt, and the govts of all democracies, recognize and combat this, and take active measures to protect their Chinese citizens.
Agree.
> Democratic governments should probably also look into providing an expedited immigration path for their Chinese citizens' relatives still in China.
Just want to point out that, Chinese spies tried to exploit expedited immigration paths in UK intended for Hong Kongers [1]. I don’t have an easy solution.
>Just want to point out that, Chinese spies tried to exploit expedited immigration paths in UK intended for Hong Kongers [1]. I don’t have an easy solution.
Yup, though I'd rather get the innocents out first and deal with any spies later.
> It's absolutely imperative that the US Govt, and the govts of all democracies, recognize and combat this, and take active measures to protect their Chinese citizens.
Yes, but they can't protect the Chinese-mainland-living extended families of those citizens
It's impossible to make a case to right wingers because 2nd generation immigrants tend to be strictly left wing, and more progressive to boot. And imo, as a 2nd generation asian american, they tend to have a more overt racial identity and it doesn't necessarily manifest in a way that leads to a cohesive society. I knew a fair number of other asian americans who strictly saw America as a colonizing force, basically the bad guy. On one hand they're not wrong about the colonizing, but on the other hand it's not exactly a healthy mindset to have about your nation, and more to the point, it's antithetical to the entire right wing political ideology. The strict nationalism of the Chinese works in their favor imo, and the US doesn't have much of a chance in matching it.
> Right-wingers may complain about this, but they have to understand that: 1) historically, subjects/victims of oppressive govts are more likely to be allies of US and other democracies, rather than enemies, and 2) innocent till proven guilty must apply universally.
You are dreaming. In reality what will happen is that the US will realize that there is no shame in being 2nd place.
American exceptionalism is somthing created by the media, in reality phenomenons such as the shifting of the global powers have been happening since forever and are so enormous that they are like the tectonic plates. They can't be stopped or messed with.
It's not a tragedy either, Europe was #1, then it dropped 2nd place and people there aren't exactly running around like chickens with their head cut off.
It's only an issue here on HN and reddit where people love to deeply analyze scenarios that they don't have any real saying on.
The rest of people just live their lives concerned with other and more pressing matters.
Things will get really ugly once you codify special classes citizens and other US persons. It won't happen even though conservative congresspeople have been pushing for it for decades.
Are you sure about that? It's the norm in Europe. E.g. you can't work for UK security services (MI5, MI6) unless one of your parents was also British, you lived in the UK for a while and you might be required to give up dual citizenship.
> Are you sure about that? It's the norm in Europe. E.g. you can't work for UK security services (MI5, MI6) unless one of your parents was also British, you lived in the UK for a while and you might be required to give up dual citizenship.
I think it's actually similar for US security clearances, though not explicitly codified like that.
IIRC, if you're a dual citizen, you have to renounce the non-American one. Apparently it's not good enough to say "I'll renounce it if you ask," since that's conditional (on them requesting it). You have to renounce it unconditionally. I think that even applies to allied countries (e.g. no US-Canadian dual citizens).
I think the US would also reject a clearance if the applicant had relatives that were in a situation that could be used to exploit them (e.g. foreign nationals, living in a non-friendly country, etc).
Basically, the idea is that you shouldn't have any (discoverable) competing loyalties, and you shouldn't have anything in your life that makes you vulnerable to manipulation.
Disclaimer: I have no actual expertise in this area, but I did spend an afternoon browsing the government website where they described security clearance rejection appeals.
You can get approved for secret clearance if you are a citizen of a NATO ally. I guess because you can be vetted. Higher than that I think would be hard.
You are correct my brother got denied top secret clearance despite being active duty military because his wife is from a Caribbean nation. To get the right clearance is hard.
Constitutional amendment that the government can't deny citizens "privileges" and that they get equal protection under the law. There's a whole mess of court cases around that and it can get complicated. But it's going to be tough to get something like you suggest past the courts.
Those don’t meaningfully apply for security clearances where an argument can be made that it exposes someone to the possibility of blackmail, etc. (such as extended family in the mainland being held hostage, which has happened)
It will. Yet, any country has the right to discriminate in any way against someone wishing to enter the country. It's once those people are let in, and given citizenship or PR that they enjoy protections against discrimination.
This would have to be a "moving forward policy". Anyone in the US already enjoys protection against discrimination based on place of their birth or race.
In the future, it could be a condition of entry that people acknowledge they are not allowed to work in certain industries, for the government, or universities etc.
Yes, the cohort with security clearances is very white and eurocentric, which perpetuates a racial/ethnic divide between the in and outgroups for power in the US. Yes, you can't be legally discriminated against when seeking to be a wage slave, but if you want to get into the real echelons of secrecy and power, it's status quo, and without transparency.
I believe Chinese law is you can't hold dual citizenship so anyone with Chinese citizenship who becomes a naturalized US citizen loses their Chinese citizenship.
A shallow look at that may lead one to think there's no security issue. It's actually the opposite.
My sense is that this allows the Chinese government to entice former citizens with restoration of their citizenship if they come home, bringing all their skills and IP with them.
I'm not even sure this is explicit. It's simply understood that if you have knowledge in key industries the door is always open to your return to China.
Or it may be much more active and quid pro quo. Who knows?
> US government will at some point soon decide that any person born in mainland China is a security risk
Chinese people earn 15-20% of graduate STEM degrees in US, double the percentage of 10 years ago, and not counting second generation Chinese. At this rate, 'US' STEM will be Chinese dominated long before anyone wakes up to the security risk.
This Mr. Wu did something bad inside China, without any evidence that he was colluding with the national and local government of China. How is that translate to security risk at US domestic?
And all these Chinese stem students already contributed critical work to the boom of high tech industry. You are not appreciting their hard work, and link a speculation to national security risk?! How heartless one can be, not only thankless, but vile and judgemental...
I have no strong opinions on this, but for background, there are a bunch of Silicon Valley types like Eric Weinstein (Thiel Capital) who maintain that there are sinister undertones to the growing influence of Chinese immigrants in Tech and Higher Education.
Looking at what Peter thiel and Weinstein presented, my impression has been that they are seeing the threat as a general trend as an influence on the US way of society. Or to be precise, the type of society that enjoyed by the rich. The powerful in US are not as better off as their counterparts in China.
As a Chinese American myself, any derivation from Peter and Weinstein's argument as the basis for special treatment to Chinese immigrants, or default being suspicious stereotype, is plain racism (looking at how Chinese Americans are treated, racism seem not applicable to our group).
I mean, if the US wanted to "solve" the issue, it's pretty easy.
Offer anyone who graduates with a STEM degree from a reputable institution US citizenship... and require they if they renounce their Chinese citizenship (which happens automatically per Chinese law, but just to be sure).
I don't think it's going to dispel the scary monster because some people would argue that "They have roots in China", so maybe just get every Chinese out of the door?
maybe both, but i was just reading the other day about the CCP setting up offices/groups/whatever basically everywhere. even around american colleges though its more low key. many chinese (ethnically, many are not even citizens) overseas join the party because they either worry about problems with relatives in mainland china, or some think itll help their careers, or they may think itll help grease the wheels if and when they return. a lot of them just spend hours studying speeches by xi for their club, apparently.
i think whats more worrying is that ive recently become concious of what i say about china online, and i have no connection at all to china. would it be a problem for me tomorrow? probably not, but 20 years from now? maybe.
There is zero chance that the OP claim 'US government will decide that any person born in China is a security risk' will ever happen. There is an ongoing STEM arms race between US and China, with China possibly already ahead. US has its hands tied, as it can't restrict 15-20% (and growing) of its STEM workforce pipeline and risk falling further behind.
Chinese firms are not directly controlled by the state.
This 'Arm Heist' is probably not driven by state apparatus.
But, some artifacts of state power and intervention are egregious enough to make them essentially an extension of state power.
1) The 'China Venture' ownership policy, is the first foundation of this 'Arm Heist', without this Nationalist policy, it'd be a different situation.
2) China has required IP transfer for many things, this is state intervention.
3) The lack of commercial legal recourse for ARM in this case, is a 'de fact' pro-China issue. It's probably not designed to be this way, but it puts every foreign company at a major disadvantage, there may be behind the scenes shenanigangs by the state, we don't know.
4) The CCP has minders in every company to ensure CCP loyalty and compliance. They were in 85% of companies, soon 100%. Imagine having a group of guys from the CIA/NSA who you have to hire inside your company, who work directly for the President, who is unelected. This is a major tool of control few people talk about.
5) Large deals and orgs are often politicized, either by powerful politicians as individuals or state apparatus. Nobody knows who owns Huawei, other then there seems to be a strategic state component.
6) The state can make powerful reforms that fundamentally reshape the industry at their leisure - they pulled Didi and And listings at the last minute and disallowed them from raising money outside China which really brought their valuation down. Not only is the government flexing it's power, but it's doing it in a sketchy, hypernationalist way. Forcing Chinese companies to remain all Chinese to raise Chinese cash etc. To me - this is the 'last straw' and it's a raising of a form of wall of capital that's frankly probably going to hurt China more than anything. Alibaba is tanking [1]
7) CCP ultimately access to any and all the data from Ant, Didi, TikTok that it needs to enforce total 360 absolutism and thought control policies.
Jack Ma style Entrepreneurs probably don't care that much about the Chinese state, but the mechanisms in place by the CCP ensure that ultimately, they are tools to it.
If a Western company can sell something in China that can't be stolen, well, they can try while it lasts. But joint ventures etc. will probably fail.
The notion of doing an IP deal with China is absurd at face value.
'Brand' is probably the best thing to have, like Pizza Hut because it's ownership of 'hearts and minds' - that said, any company that does do this is going to have to 'toe the line'.
As we've seen LeBron James become a vocal SJW in his own country, but line up like a perfect stooge anti-SJW for the CCP for Chinese related issues, actively calling on people to not call out China etc. - this does have relevance as well.
In the end, the problem is that nobody seems to be able to have enough power or intelligence to do anything about any of it. Only the US alone has enough power but even then it's fragmented. Germany depends on exports to China and their voice is the influencer in EU. Moreover, even if they were at the same table, I'm not sure if they would have a solution.
Probably what is needed is a 'China Alliance' which is to say US, EU, UK, Canada, Aussie, Japan, Korea, India etc. form some kind of common agreement with respect to dealing with China and then try to work on big issues without China trying to fragment the group. Trans Pacific Partnership was sort of that, but Trump's personal business instincts, which make sense on some level, were completely wrong on that one.
The point is that it's true when you point the finger to US companies. US companies are extensions of the US elites (while the state is just a tool). Actually US elites have way more power over foreign companies than Chinese elites do.
I really don't think it's gonna make any real difference if we are facing (strong state + weaker corporations) or (strong corporations + weaker state).
> US companies are extensions of the US elites (while the state is just a tool)
Incorrect. In the US, the state, the courts, corporations, elites, and everyone else all have competing and overlapping interests, and out of that democracy comes the sausage.
In China, the system is specifically rigged so that the state always trumps everyone else, when it decides it needs to.
The US is waking up from a post-cold war reality. In the 1980s a consensus formed that.
1. US military and economic power meant that countries could be relied on to follow US influenced IP laws or be excluded from the global market.
2. US military and economic power was large enough and benign enough that no major trading partner would pose an existential military or political threat - validated by the economic rise of Germany and Japan.
These two ideas powered US and to a lesser extent European outsourcing for the next 40 years. Very few executives believed that there was a serious risk of their outsourced manufacturing or outsourced engineering firm becoming independent - and they certainly didn't think through the reality that in such an event the holding firm would not have the capital or knowledge to compete against the newly formed firm.
The reality is that the US and Chinese economic spheres are likely to fracture in whole or in part. China owns the factories and the IP, the Chinese military is increasingly capable of achieving any military goal they are likely to have against the US military using indigenous military hardware.
There is no reason the Chinese authorities would not support subsidiaries and joint ventures becoming independent by eliminating legally ambiguous joint ventures and Variable Interest Entities, forcing sales of Chinese assets to Chinese investors, or simply creating new legislation to free such entities from foreign corporations.
I fear that the US has been so focused on outsourcing for the last 40 years that it's forgotten how unusual of a relationship outsourcing was in the first place, and why it wasn't done for most of the industrial era.
Naive question here: why China is able to close its market to foreign companies? Same thing for trade sanctions on Iran which impacted European companies but not China (if I'm not wrong). Seems they don't play by the same rules as anybody else.
China can control its market without serious reprisal because there aren't any serious reprisals available that are palettable.
As an individual country, blocking or tarrifing imports from China isn't very effective because it hurts consumers and industry that rely on importing products and raw materials/commodities/industrial inputs from China more than it hurts China who can often export to other countries instead.
Blocking exports to China is tricky because one the one hand, China doesn't import too many things, but on the other hand, for those things they do import, they're a large portion of the global market, so a country that cuts off those exports will leave their exporters will a large surplus, often of perishable goods, that will be difficult to deal with.
So, trade controls are tricky. Most western countries don't have much in the way of laws that could restrict foreign ownership of land or businesses except in exceptional cases. And military intervention would be wholy inappropriate and probably disasterous. Really just not a lot of options.
> As an individual country, blocking or tarrifing imports from China isn't very effective because it hurts consumers and industry that rely on importing products and raw materials/commodities/industrial inputs from China more than it hurts China who can often export to other countries instead.
This isn't really true. If there is a tariff on importing iPhones from China, in the short term iPhones become more expensive by the amount of the tariff, but also the US taxpayer pays lower taxes for the same level of government services because the tariff money is going to the US government. So to US citizens in the short term it's net-zero.
In the longer term, Apple builds an iPhone factory in India or Mexico. The US iPhone customer doesn't even really notice the difference from this, but China obviously does.
> Blocking exports to China is tricky because one the one hand, China doesn't import too many things, but on the other hand, for those things they do import, they're a large portion of the global market, so a country that cuts off those exports will leave their exporters will a large surplus, often of perishable goods, that will be difficult to deal with.
Nobody really even wants to block exports to China. Gaining fair access to the Chinese market is kind of the point, and for things like soybeans or something like that, "fair access" mostly just means they're buying your products.
It's more complicated when you start talking about tech companies and censorship, because then it's about more than just "they're buying it from you."
Moreover, where export restrictions hurt isn't necessarily for things where they're paying a lot of money. It's for things they can't get elsewhere.
> Most western countries don't have much in the way of laws that could restrict foreign ownership of land or businesses except in exceptional cases.
That wouldn't be that hard to change. Especially for ownership of land, the change would be locally popular because it would make housing more affordable, and the foreign interests who would have to sell their holdings don't get a vote in US elections.
Because china, unlike most of the other countries in the world, has a massive population and resources to get atleast partially self sustaining.
Also, the fact that exporting manufacturing to the east let to a lot of short-term profits for western companies.
The question is at what costs, looking at climate change, the current shortage of nearly anything manufactured right now and the destablisation of society thanks to the dropping of quality of life of many people in the west.
> Because we assumed that prosperity would lead to liberal democracy. That underwrote complacency while profit motivations took root.
this might be a formal narrative, but the simple truth is that we did it because it made powerful people rich and entrenched specific factions in both parties
> this might be a formal narrative, but the simple truth is that we did it because it made powerful people rich and entrenched specific factions in both parties
I don't think this is true. When these policies were first enacted upon, the revolution had just ended in China and Mao had just taken over. The population of China was large, but nothing like today, and cheap labor was plentiful all around the world. In short, there was nothing in particular that made doing business in China more lucrative than any other developing nation at the time.
The belief was that doing trade and business with the new Chinese government would encourage the developing nation to embrace western ideals... which it clearly did not.
Today, doing business in China is lucrative only because they have well over a billion people to buy products and use services... it's clearly short-term profit-driven thinking that has the likes of Apple bending over backwards to stay in the CCP's good graces, all the while the CCP steals Apple's IP, forces Apple to bend their morality, aid in censorship, unwittingly employ slave camps and more.
Or that capitalism was an inextricable part of democracy, and bringing the former would inevitably lead to the latter.
A quite foolish assumption given the 20th century counterexamples of capitalism + authoritarianism - Nazi Germany, Fascist Italy, Imperial Japan.
In the 90s, Wall St. and corporate America bankrolled the largest ever lobbying campaign to open US markets and the WTO to China, and got it by 2000.
Just two decades later and the result is massive inequality, a decimated middle class, vulnerable supply supply chains, and rising authoritarianism again.
The US has stupidly snatched defeat from the jaws of victory in the Cold War.
> that capitalism was an inextricable part of democracy, and bringing the former would inevitably lead to the latter
This was never argued by anyone of prominence in the debates on China's WTO accession. Raising living standards through trade was the pitch. The faulty assumption was wealthier Chinese would demand more freedom. That didn't happen.
The implication at the time - the "End of History" era - was that free trade capitalism had prevailed and was the way to raise living standards, and that political liberalization would follow. However you slice it, it was a poor assumption.
Regarding Nazi Germany, let's say, it's complicated. While it's true that Hitler apparently envisioned a corporate society in "Mein Kampf", in actuality, the industry was much more structured capitalist than anything else, even in WWII. Thus, corporatist tendencies merely controlled the labor force and bound the intellectual class and educational system to the state, rather than actually defining the economic system. (This is also true for Austria, which was an explicitly corporate state in the 1930s before the Anschluss.)
Edit: As far as economic theories of the "Third Reich" are concerned, there was (quite naturally) a fascination with Fordism.
Fascism is not a capitalist economic model. It is a "third way" socioeconomic system that proposes an alternative to both capitalism and socialism where both capital and labor are regulated by an all-powerful stern father figure Leader, who mediates and subordinates their petty squabbling to nationalistic interests.
Pre-CCP history — the two Opium Wars demonstrated to the Chinese about staying in control of domestic markets ahead of foreign merchants, otherwise, they lose some of their sovereign power: https://en.m.wikipedia.org/wiki/Opium_Wars
To be fair, Imperial China has a history of developing vassal states in its sphere of influence, so what goes around, comes around.
Main thing is that China used to have greater influence and I think the current generation of Chinese citizens see no reason why China shouldn’t be a superpower, even if they have to share it with the US.
What's different in China's case compared to other protectionist countries is they can get away with being protectionist.
How can they get away with it? They have powerful people lobbying with foreign governments on China's behalf. Take Apple for example: they contract out iPhone manufacturing to Foxconn in China. Due to the low cost of manufacturing they are able to generate astronomical profits.
Every measure against China will directly or indirectly impact some US multinational corporation and it's natural for the corporation to lobby Western governments to put the brakes on such measures.
On the contrary, if you look at Iran or Russia, multinational corporations don't have a similar deep-seated interest or supply chain infrastructure as they do in China. How did this come to be? A lot of it can be attributed to Deng Xiaoping's setting the tone for China's relationship with the West: “stabilize the position, observe calmly, take all in stride, never take the lead,
and hide our capacity to bide our time.”
>why China is able to close its market to foreign companies?
Why shouldn't they? It's their market. Do you propose we do like the British, which bomb them and opened it by force to have them buy opium?
For perspecive, and to answer the "seems they don't play by the same rules as anybody else", part, the US has historically had tons of tarrifs on its own, it's how it got big - they only switched to "free trade" when Europe was devastated from WW II, and the US was already top dog dictating this "free" trade terms:
"The United States pursued a protectionist policy from the beginning of the 19th century until the middle of the 20th century. Between 1861 and 1933, they had one of the highest average tariff rates on manufactured imports in the world." [1].
Even so, US still has tarrifs and protectionist policies in many areas, not to mention the whole "yield the power of our military and diplomatic power to enforce favorable deals making a mockery of the free market we pay lip service to" thing.
Not to mention selectively targeting countries they don't like to close their markets via embargos, and using their force to force adherence to those embargoes to other countries around the world, something which no country dares do back (and can't anyway). Talk about "not playing by the same rules as anybody else".
Yes, because China is not in the development stage the US is now, but where it was decades ago and with huge setbacks from the 19th century and Mao era.
The finger pointing to that is a "I kicked the ladder after I've climbed" thing (or "do as I do now that I'm on top, don't do what I did to get on top, I don't want competition up here" kind of advice).
> why China is able to close its market to foreign companies?
It is not though, many foreign companies do business in China. Even Facebook and Google retain part of their Ad business.
> Same thing for trade sanctions on Iran which impacted European companies but not China (if I'm not wrong). Seems they don't play by the same rules as anybody else.
First, EU doesn't like the idea that US sanctioned their companies because of Iran oil, that's why they rolled out some law that protect against it recently. Second, it's just US (and part of other western countries' as they have to eat it) rule, regarding the Iran oil example. China is not playing by that rule simply because so far there is not enough push from US.
A point on addressing China as market: for a non US company, I think there just isn’t any market that will be much easier to compete in either way.
If we imagine a Swedish chip maker that wants to become a global powerhouse, the US will dip a finger or two in it to make sure it mostly goes along their interests, otherwise the maker will just get banned from US use (Huawey…). China will do the same if the chips ever touch the chinese soil. Japan will tax it through the roof anyway. India is another kind of wild ride.
We’re left with the Russia, middle east, and Africa. Basically any company with big ambitions will need to choose to open up to China or US control up to a point, and understand that if they really become critical any legal ground they stand on can be swooped away with a sleight of hand.
The US is not going to interfere in 'Swede Corp' unless it's a serious issue of state security. Spottily could be worth $500B and they would not care. Recently Erickson took the spotlight as one of the few alternatives to 5G Huawei there was talk of US sate intervention but that might have been a good thing for them, otherwise, if they came to totally dominate 5G gear sales, again, the US wouldn't really have cared.
Nokia used to completely own mobile, Apple and Google game to dominate that but not out of a national strategy of some kind, although there are systematic artifacts of it behind the scenes.
Spotify has barely any material relationship with the US Gov. and that they are closer to Apple and Google is normal.
Nokia might have some relationship with US gov. but that's also normal.
US Gov. will not interfere in most cases with things.
With energy security i.e. Petrodollar, yes, but usually it requires a 'problem' to surface i.e. chip shortage for them to take action.
The US benefits from 'open trade' - being the biggest economy i the world and fairly open, it usually means 'they win' so they're fine with it, they don't have to be protectionist or nationalist. 'Open' is a winning strategy for them in a way that it's not for say, Sweden or Columbia, which may have to have more selective national strategies.
> The Chinese government will ensure that no Western competitor will "win" in China. Period. I understand why to a point. My main issue is with the West being completely oblivious to it.
> If China wants to impose such restrictions on Western companies, they shouldn't get access to Western markets. And that's it.
And there are people around who give this a pass. And usually the defense is "China is just following Chinese law".
It's fine if China and Chinese want it this way. It just means that our posture with them should be adjusted, i.e. extracting a price for IP theft etc.
And if China is in China, they can follow Chinese law. Once they come out of China, to do business with the West, then that excuse doesn't cut it. (Just like the way that Western companies have to follow Chinese law to do business in China.)
There is reason I'm willing to be slapped by you.
May be is your daughter or w
Just like some company do tech transfer in exchange for access to the market.
You are welcome to take advantage of my hospitality and tea. But do you know what is in the tea?
You might get addicted to the tea that you willing to obey me.
Just like sanction ( weaponizing dollar )
So you concede that China imposes unfair and unilateral constraints on foreign businesses, and you are asserting that it's alright because foreign businesses _still_ have something to gain.
But you don't mention what that something is. Stockholm syndrome? Or a propaganda bot user?
The question stands: Why should anyone put up with a one-sided, unfair trade regime.
I suspect China doesn't really need western markets in the long term so denying access isn't all that powerful. Their population is the same as the entire OECD combined. They could become an entire "western developed economy" isolated within themselves plus a bunch of 3rd world allies.
I suspect China doesn't really need western markets in the long term
Being from the West, we see things with West-Centric eyes. When, if we look more closely, we see that China alone has more customers than the whole of the West (Five-Eyes, Europe, Japan) combined.
The West is pretty much unimportant, relatively speaking, in the over-all scheme of things. A mere 20% of the world's customers.
As a whole, the world is reverting to the status-quo that existed prior to the 1400s: The world's big economies being in India and China, with Europe/Europeans being a quiet backwater.
Yeahh except for the fact historically the west have been developing technologies and social ideologies which are ultimately adopted by other 'civilizations' for millenia. For what counts, they have always been on top, and will be for the forseeable future. other civilizations are still playing catch-up and have social structures which inhibit development, as for china, its delusion of being the centre of the world is what is making them set such arrogant, unreasonable trade terms.
The West + Japan + S. Korea, is where almost all the money, power and GDP is. China has roughly the same as the US, but with many more people. The 'Rest of Asia Minus Japan+Korea' is big, but still poor.
Sorry to say, but this is typical Western 'markets above all' blinders. Very true, long term China doesn't need Western markets. But China needs World's resources, and Western markets will crash when starved for resources. The future is one Eastern developed economy, and various backwater client states in constant state of quarrel with each other while being striped bare for resources. There is a lot of corn grown in Iowa, I hear there is a big market for it overseas.
>Let me spell it out: Chinese companies are extensions of the state. They are tools of Chinese foreign and trade policy. What cooperation you think US companies provide the US government, it is nothing in comparison.
I'm not so sure. It just goes through a few more mediators and more roundabout ways.
In the end, the fruit companies that turned Latin American countries into banana repubics, for one example, had big support from the state and vice versa. Ditto for oil, telecommunications, social, and so on.
> The Chinese government will ensure that no Western competitor will "win" in China. Period.
Isn’t it the MO of any country that wants to go ahead ?
Wasn’t born during the period, but I know of the US’ Japanese bashing in the 80s and pulling all the levers to stop foreign companies from getting dominant in the car market. As far as I know Toyota & co had to bring manufacturing to the US to get a foothold, and I get the feeling China has just made that a policy from the start instead of going throught all the cycle.
There are better words for a conflict that's not currently active warfare. The US and China can disagree and take action that isn't mutually beneficial without it being a war. How we talk about things reflects how we think about them and limits the solutions we consider.
None of which changes the fact that there is a war. Not only are the two nations still involved on opposite sides of the Korean War, which has never concluded, but China routinely scrambled fighters and bombers to harass U.S. ships in international waters.
There is no economic tie between US/Soviet and nothing happens. 40 years of trade with China had propelled China to the number 2 economy in the world while sacked American manufacturing some projected China will surpass US in the near future. middle class American suffered and they voted Trump. is gig economy all that's left for middle class? while rich get even more rich from US/China trade.
>Here's where I think this will first come to a head: I believe the US government will at some point soon decide that any person born in mainland China is a security risk as far as working on anything national security related.
I was at Google during the Project Dragonfly revelations. My name is on this petition [0]. Internally, I expressed discomfort at cooperation with a state that (among other things) sets up covert Communist Party cells at American universities and requires Party members to write reports on other Chinese students' political speech and activities. After sharing this concern, a fellow Googler reached out and told me earnestly, "don't worry, none of us writing those reports took it seriously."
I worked at Google years ago when in response to what most believe was a Chinese state-sanctioned hack, Google decided to pull out of China. Many believed (myself included) that this pull out was largely driven by Sergey Brin. This all happened in the 1-2 years before I joined but I like many greatly respected that stance.
It was sad to see (from the outside this time) this principle get thrown aside with Dragonfly. What's worse is that Google will never be allowed to succeed in China so there was literally no point.
SoftBank sold ARM to Nvidia. And I thought Nvidia is Taiwanese since the parent comment mentioned China but maybe I was wrong. It seems like Nvidia is American. Why he mentioned China?
> As part of the emphasis on the Chinese market, SoftBank succumbed to pressure and formed a joint venture. In the new joint venture, Arm Holdings, the SoftBank subsidiary sold a 51% stake of the company to a consortium of Chinese investors for paltry $775M.
Taiwan is indeed the Republic of China, but generally when people refer to “China” without qualification they are referring to the People’s Republic of China.
Not sure how did you get the idea that the market was not there.
Arm China had stellar financial results. Arm holding, with 49% share of the company, has significant upside to gain from the market.
And this fiasco is partly a misconduct of Mr. Wu, showing no signs of being directed by Chinese investors.
And partly because of Trump's tech ban, which obviously affect arm China's prospect.
And then this statement:
> I believe the US government will at some point soon decide that any person born in mainland China is a security risk as far as working on anything national security related.
Even if Mr. Wu was directed by CCP, how can you extend that to all of Chinese immigrants? There are plenty of Chinese Americans who had misconduct inside China, and flee the country back to US to escape Chinese law (numerous corrupted officials of course are such examples) recently https://m.sohu.com/a/412302008_220095/?pvid=000115_3w_a are these people US spys to sabotage Chinese economy then? How ridiculous was that logic.
"Arm China had stellar financial results. Arm holding, with 49% share of the company, has significant upside to gain from the market."
This is because clients and accounts that previously belonged to Arm had to be handed over to Arm China if Arm wanted to continue doing any business with Chinese firms, regardless of whether they'd actually courted their business.
This is like picking your left pocket and arguing that you stand to gain because I'm putting some of the money back into your right pocket. I'm still robbing you, even if I'm giving you some of your own money back.
I'm talking about US 20 years from now. Those in corporate America who think they are 'winning' today by selling out Western knowhow to China and failing to cultivate an indigenous STEM workforce are in for a big surprise when the high value add industries fade away into China, just like basic industry did. They may still run the local subsidiary of Huawei under Chinese upper management pushing overpriced Chinese surveillances to the US market, but the profits will belong to the victors and head straight to China.
one of the best arguments against anarcho-capitalism is that without a goverment, there would be no market to speak of.
why exchange in trade if no one can guarantee it will be beneficial for you? Why would the other party trade instead of just stealing your stuff?
You could ofcourse defend against by carrying a bigger stick then the next guy or cooperating with others.
Which starts to look an awful lot like the organised structure of a state..
> one of the best arguments against anarcho-capitalism is that without a goverment, there would be no market to speak of.
> why exchange in trade if no one can guarantee it will be beneficial for you? Why would the other party trade instead of just stealing your stuff? You could ofcourse defend against by carrying a bigger stick then the next guy or cooperating with others.
> Which starts to look an awful lot like the organised structure of a state..
Anarcho-capitalism is like one of those high atomic number elements with a half-life of microsecond. The society it describes is so unbelievably unstable, due to its own internal contradictions, that it practically cannot exist. A stable version of it is a literal fantasy.
Yeah, same thing with communism and the assumption everyone will work for the best interest of the state. It just takes one bad actor and the corruption cascades and ruins the system. At least capitalism uses human greed as a motivator. I do think humans can be selfless, if they are mindful and educated, unfortunately with current poverty levels and disinformation, people arent smart enough to realise whats good for you is good for me
> Let me spell it out: Chinese companies are extensions of the state.
Where this comes to a head, and where western capitalistic governments seem ill equipped to handle it sufficiently, is in how China itself can and does act like one giant super conglomerate company and uses that to bully smaller companies because they are bigger than anything around. Western governments are loathe to intervene in business dealing when they don't have to, because their systems are based on a fairly hands off approach with the free market. The one place they sometimes do step in is when there's a monopoly or some other anti-competitive practice. The problem here is that the anti-competitive practice is being enabled by a foreign state that's working under the illusion of separate corporate entities.
What's a country like the US or UK to do? Tell it's local companies that want to and are totally willing to shift IP to China to access the market "No, sorry, you aren't allowed to, even though you own that information and it's not a state secret"? That may be what's needed, but it's a large difference in thought in how they've treated their markets to this point.
>What's a country like the US or UK to do? Tell it's local companies that want to and are totally willing to shift IP to China to access the market "No, sorry, you aren't allowed to, even though you own that information and it's not a state secret"?
Yes, that is literally what the US has always done. The government can ban you from exporting anything it wants, which explicitly includes tech transfer.
China isn't just taking tech IP. They're taking everything. They localized and took a bunch of train IP from German company they partnered with in the past. They've been doing it for decades.
You can say we do that all the time, but have we really been prohibiting experienc and technology for diesel engines?
Like you say, maybe we should, but it will be an interesting argument to have with companies that really want access to the market, and view this specific aspect of the contract as none of the governments business.
Stuff like train IP is actually included in tech, same as rockets would be. My understanding is this is a legal definition of technology which can include basically anything (especially anything you might ever patent or have patented).
I also didn't mean to imply that the US has done a lot of this. I don't think they have in the free trade era. I just meant to point out that it has always been done for some stuff (one of the most controversial and what introduced me to this many years ago was the crypto export ban). The last few years have already seen an explicit expansion of much more general purpose tech being restricted, with China being a known bad actor for forced tech transfer, so it doesn't seem like a stretch that we'll see more of it.
> one of the most controversial and what introduced me to this many years ago was the crypto export ban
Yeah, I'm well aware of that ban, which is what I was alluding to originally with the "even though it's not state secrets". Crypto isn't really a state secret, but it's classified as munitions, which is equally as weird and convoluted, and probably only really accepted because they were able to make a case about it being a national defense issue.
Controlling what companies can and can't do with their own property gets weird fast. So maybe some laws go in place to prevent China from cooercing IP from companies that want to work in their market. What if China just wants to outright pay for the technology and buy the IP? Is that okay? What if that purchase price is based on some other stipulation that they don't follow through on? The whole problem here is that some Chinese companies are willing to just say "screw it, your laws don't apply here and our prior agreements don't matter, and my government will back me up" and there's not a lot of recourse at a company level to stop that. The only way to actually stop any abuse is to disallow all business with China unless they adhere to the rules, but that's a hard sell when it looks like it's a nationwide ban because of a few bad companies, which is definitely how China would spin it and how it would be disseminated through specific media campaigns.
And actually banning business with China would be so disruptive and so unpopular for some companies (and companies that would be willing to push against that legislation) that it really would be extremely disruptive internally, and be presented as an issue of over regulation and big government intervention and racist and everything we've already seen before, just turned up to 11. And honestly, China might see that as a win no matter what happens, because it either exposes the dysfunction in our economic model or it moves it closer to their economic model, which would be a vindication of their path.
Some are, some aren't. The current China "antitrust" flap is over ones that got really big without being extensions of the state, such as Tencent and Ant Financial. The classic big ones, such as Baowu (steel), Cosco (shipping), and China Railway Group (obvious), are directly state-owned. There are also large companies owned by provinces, regions, and cities. Most small and medium sized companies, though, are not state-owned. State ownership of almost everything was tried during the Mao era, and it didn't work.
The CCP insists on being the only major center of power in China. They're willing to tolerate capitalism until it generates companies big enough to push back. Those get taken over or converted to state ownership.
At a minimum, the CCP has full visibility into every company operating in China. They require taxes to be filed via government-provided software, and this software was found to contain backdoors.
It gets even more insidious when every company above a certain size (10? 15?) is required to hire a Party Officer for oversight.
>any person born in mainland China is a security risk
We've staffed our campuses and laboratories with these people because there's nothing university administrators like more than cheap labour. The Chinese Communist Party has agents inside western countries who can get to these people, to say nothing of what they can do to these people's families back in mainland China.
University administrators? More like any medium to large employer these days.
The carrot on the stick is gone for a lot of westerners and so they would rather bring in modern slaves from China, India, and Iran and blame the whole thing on "lazy" youth and "worker shortages". Gee, I wonder what the cause of that shortage is. Could it be because workers are miserable and have no foreseeable future? Nah, must be because the government is giving them a few thousand bucks.
Who's the main currency manipulator? The US, and its many, many trillions of dollars in debt which other countries are forced to purchase in order to participate in the global market. As long as the dollar remains the world reserve currency, i.e. as long as the US monetary hegemony lasts, the US will remain the leading currency manipulator. They've shamefully printed about 10 trillion dollars the past couple of years.
PRC has made irredentist claims to parts of Tajikistan (Pamir), India (Ladakh), Vietnam (Paracels) and of course Taiwan. They invaded Vietnam in 1979 when the latter overthrew the genocidal Khmer Rouge in Cambodia (PRC supported KR) and have provided support to both the Burmese and North Korean dictatorships. Granted, they haven't done nearly as much meddling as the United States, but they nonetheless demonstrate a willingness to turn a blind eye to the worst sorts of atrocities when it suits them, and a generally expansionist ethos.
I've heard a couple stories in SV of a certain chinese network hardware maker hiring phd researchers away from places like Cisco. Then finding ways to coerce or blackmail (threatening to ruin them) them into coughing up secrets from their previous employer.
"If China wants to impose such restrictions on Western companies, they shouldn't get access to Western markets. And that's it."
Why? Why should we prohibit US citizens from purchasing things they want from wherever/whoever they want? Why would we do that to ourselves (I'm a US citizen), and to each other?
The same reason we don't let people do business with North Korea or purchase stolen goods. The same reason we shouldn't let people buy conflict diamonds or clothes made with slave labor.
It will come to a head with WWIII, millions dying from nuclear or biological warfare (which by the way Wuhan was the Hiroshima of biological warfare [whether it was intentional or not]). Or if we are lucky, they will just give in rather than face the next bioweapon.
Let me spell it out: Chinese companies are extensions of the state. They are tools of Chinese foreign and trade policy. What cooperation you think US companies provide the US government, it is nothing in comparison.
The Chinese government will ensure that no Western competitor will "win" in China. Period. I understand why to a point. My main issue is with the West being completely oblivious to it.
If China wants to impose such restrictions on Western companies, they shouldn't get access to Western markets. And that's it.
Here's where I think this will first come to a head: I believe the US government will at some point soon decide that any person born in mainland China is a security risk as far as working on anything national security related. This will probably extend to key industries of national importance too (eg SpaceX).