The fundamental questions that America needs to answer are:
What are the aspects of the current economic relationship with China that are beneficial to the US, and what are the aspects that are harmful.
What policies should it adopt to manage its relationships with China while maintaining its values. Whether it should act unilaterally to achieve those objectives, or coordinate with its allies.
What are the near-term and long-term consequences of Cooperating with China vs. Competing with China in a new cold war, considering China's power will likely rise in comparison with the US's.
I look at some of these questions from a game theory oint of view though, and China has shown itself something of a very regular 'defector'. In these recent moves the US has embraced more of a tit-for-tat strategy. And we're not the only players. Some other countries are to some degree going to follow suit with the US, making this a multiplayer game, in which tit-for-net has a larger upside for the cooperators than the sole defector. Of course this over simplifies things, but it's incorrect to say China's power will significantly rise relative to the US if the US and other countries begin treating with them as an "always defect" actor in this game.
If you want to throw geek jargon around, drop the "game theory" lens and start re-evaluating your "zero sum" assumptions.
A world where we buy endless cheap junk from China and ship cash out of the country to pay for it is far richer one for everyone[1] than one in which we need to make all the junk at our labor rates. Why? Because all that cash is coming right back into the country as investments.
It's like shopping at a store which decides the best use of their income is to lend it right back to you so you can buy more stuff.
[1] Especially the chinese, of course, who have lifted their nation out of abject poverty in barely over half a century. But we win here too relative to the isolationist scenario.
You totally miss the point. The problem is never about China's "endless cheap junk". It is about the rising economic / technology / military power of this authoritarian state, which is a threat to the whole world.
My alternative point was that an authoritarian yet peaceful government is less a threat to humanity than Mao's genocide-scale famine. The chinese are oppressed, the PRC is an unfair dealer on the world stage, yet this is still a preferable situation to watching literally a billion people starve. The PRC government can be simultaneously the larges geopolitical "threat" to the world community and the architected of the single greatest improvement in the human condition of the last century.
The world is complicated, and not easily reduced to buckets of good guys and bad guys.
in modern times how often has China intervened in the affairs of a foreign state?
Often. North Korea on a regular basis, Vietnam, their relations with Taiwan are a mess that needs books to cover, and their relationship with Russia over Russia's eastern border is, at best, unpleasant. I'm sure a little google-fu would reveal more. They're a world power. Interfering with other countries is part of that package.
It's not geek jargon, or at least not in the pejorative way you use that phrase. It is simply language that is part of a particular field of study. It is only one tool in a tool chest, and I certainly never claimed my back of the envelope analysis was comprehensive. In fact I tend to agree with a lot of your comments in this sub thread, and upvoted all of them. But bear in mind that to do that I had to try real hard to push aside the condescending tone that dripped off a lot of what you wrote. I'm sure you couldn't care less about my miniscule addition to your karma, but you would be a more effective communicator if you stopped trying to belittle your partners in discourse.
> A world where we buy endless cheap junk from China and ship cash out of the country to pay for it is far richer one for everyone[1] than one in which we need to make all the junk at our labor rates. Why? Because all that cash is coming right back into the country as investments.
This does not automatically follow--and, in fact, I would argue against it.
GE had to "insource" their hot water heater manufacturing to continue to wring out cost savings--and discovered that they had forgotten how to design and build hot water heaters.
That is fairly strong evidence that keeping this stuff in China benefits China to the detriment of other countries.
I am okay for paying a not insignificant amount extra on my goods to keep the knowledge of how to make them in the domestic area.
> keep the knowledge of how to make them in the domestic area.
To what products does this logic not apply? What do you consider "domestic"? This sounds like an argument against the whole idea of trade in the abstract[1].
The basis of the theory of trade, frankly the whole point of trading at all, is that some people can make or get stuff more cheaply than other people, and that by "trading" those items with people who need them for stuff we want we all win.
I mean, fine. If you don't believe macroeconomics, I guess I can't do anything to convince you. Just recognize that, well, you sound absolutely crazy. This is flat earth scale nuttery.
[1] It's not, of course. And the "domestic" is the giveaway. You don't like foreigners getting uppity, and you're willing to comparatively impoverish yourself to keep them down. I, for one, am horrified at the oppressive antics of the PRC but still think that the last few decades of growth are a good trade relative to the literal famine of the 60's.
I'll bite that bullet. I don't believe macroeconomics. Microeconomics is pretty solid; that's the part of the field that's actually grounded in reality. Macroeconomics is like SETI; in the absence of the ability to carry out much in the way of meaningful experiments, it's mostly people just taking what we emotionally want to believe, and garnishing it with equations until it tastes like science.
> I mean, fine. If you don't believe macroeconomics
That is a strawman against the argument and not brought forward in good faith. And macroeconomics does include the reality of countries using taxes to create a disincentive for consumption. Just like they do for domestic markets. There are a lot of these taxes in place from both sides.
Not saying the employment of taxes is generally a good idea. I wouldn't think they are with the intention to limit technology transfer, but there are certainly valid reasons.
> The basis of the theory of trade, frankly the whole point of trading at all, is that some people can make or get stuff more cheaply than other people, and that by "trading" those items with people who need them for stuff we want we all win.
If your base assumptions are wrong you can be very wrong in very consequential ways for a very long time. Economic specialisation as an inherently positive process is in fact a higly dubious propostion[0].
> The more specialised a country is, the higher its welfare will be, and specialisation
via free trade will promote growth in all countries... It is a beautiful story. Unfortunately, disinterested empirical research by data scientists strongly
suggests that it is in fact a fantasy: the wealthiest countries are not the most specialised economies,
but the most diversified.
Sigh. That's not a refutation of specialization as the basis of trade at all. It's a specific examination of specialized economies within the EU with respect to Brexit (which is to say: absent any specific criticism it's a political screed with a policy angle and not a dispassionate work of science).
Again, this is textbook macroeconomics that no one seriously argues with. It's possible to make an argument for a specific externality about a specific product or market (trade in Europe vis a vis UK exit from the EU, or the example above which was, hilariously, home appliances), it's absolutely insane to try to generalize that to "we shouldn't trade for anything we can make ourselves".
The awkward elephant in the room here is that China appears to be much more able than the US, at least right now, to rapidly pivot and turn a near-term weakness into a strength. There's plenty of evidence of this (their rapid transition to nuclear, rapid deployment of high speed rail, how they've generally been able to modernize their economy on a short timeline). Your questions are good ones, but I don't think we're asking the most important one: is the age of "free market" capitalism coming to a close with the rise of China (broadly defined as the more free and democratic your country is the more rapid your growth will be), and is the real competition we're entering into a conflict between a "free" and "quasi-authoritarian" vision of capitalism?
The US has been retreating from the free market for many years. 25% of GDP is healthcare, insurance and education.
Key drivers of the economy, like housing, exist in their present form to due explicit and implicit subsidy. I think China is more like the US then we care to admit, except they think on a longer timescale.
If you add in the GDP component of the financial and defense industries, you are looking at a massive overhead of markets managed by implicit or explicit government enforcement (or lack of it) for the benefit of a small elite. This is similar to China, but the Chinese have strategic vision for their economy; in the US it is managed by random allocation of lobbyist dollars.
"If you add in the GDP component of the financial and defense industries, you are looking at a massive overhead of markets managed by implicit or explicit government enforcement (or lack of it) for the benefit of a small elite."
This is not true.
To construe 'finance' a just some arguably unnecessary or inefficient 'overhead' in the economy belies a basic lack understanding of what that industry actually does.
It's often opaque to outsiders, but banking is a real value creating part of the economy, and it's also right at the foundation of it.
Also, 'defence spending' is a normal part of every economy, and it has existential impact for all of us.
Consider for a moment that US forces keep most international waterways open for everyone to use, even economic rivals, and even military rivals (!) so long as there's no war. The Suez Canal, Panama Canal, and other critical areas would instantly be under the control of nefarious regional forces if there were a power vacuum.
The Big Thing that the banking system does is it lends people money and charges interest. The other services it provides are important but minor compared to that central goal.
Now, the US has an overt policy of controlling what interest rate is charged.
So the banking system is a free market in the sense that theoretically participants could choose to leave if they wanted to. However, there is also a very overt layer of government decision making and control. The government putting a finger on the scale in a very fundamental way.
Exactly how that compares to China is difficult to judge - whatever it is, I argue it isn't very capitalistic. Capitalists are supposed to go broke when they lose money and given how low interest rates are they are more likely to refinance themselves with a new loan. The damage that has been doing to wealth creation since the GFC in around '08 is profound.
It is hard to say how much worse China's approach is. It isn't as clear cut as China's Government vs 10,000s of Capitalists - in which case I'd favour capitalism by the numbers. The US government is hamstringing the ability of its own economy to organise around profitable ventures. Instead it is encouraging Ubers and Lyfts.
> So the banking system is a free market in the sense that theoretically participants could choose to leave if they wanted to. However, there is also a very overt layer of government decision making and control. The government putting a finger on the scale in a very fundamental way.
You say this as if China were innocent in manipulating banks to control their banking system. This is not true. [1]
>The US government is hamstringing the ability of its own economy to organise around profitable ventures. Instead it is encouraging Ubers and Lyfts.
I disagree with this. I believe the Ubers and Lyfts (and Teslas) are caused by investors wanting to get in on the ground floor of the next Apple. To support your argument, please explain how the US Government is preventing its own economy to organize around profitable ventures. You may use citations.
Right, which is exactly what I'm getting at. In that sense, the Chinese model is much more able, in my humble opinion, to do a massive pivot. They may be starting far behind the US, but ours is a much larger and slower moving ship.
Oh yes, the famous Four Great Inventions. Unfortunately those are very shaky claims.
Just look at the first one: papyrus was in use for nearly 5000 (five thousand!) years in Ancient Egypt and all over the Mediterranean before paper was conveniently invented by Cai Lun.
The term paper itself is actually derives from "papyrus".
It's really not any different with the rest of those claims.
Invention that improves a manufacturing process is not the same as inventing the entire product category, which has existed for literally thousands of years.
It really amounts to claiming to have invented the entire field of metalworking, when all that's invented is the casting process, whereas everyone was using forging techniques before then.
Paper is not just another form of papyrus, despite the etymological relation. Paper is vastly superior to papyrus, and it's a hugely important invention in human history.
It's very difficult to see what you're actually trying to argue here. Chinese civilization generated a large number of important inventions, including (but obviously not limited to) the stirrup, paper, gunpowder, silk, the compass and paper money. It's about as silly to try to deny this contribution as it would be to deny the contribution of the Greeks to civilization.
Silkworm & tea can be included as major inventions that were stolen as well.
I always find it funny/sad that Easterners in addition to suriving the crimes, have the extra task of educating the Western populations of the crimes committed in their names.
I expect you've noticed that every single country that is a victim of modern Chinese espionage was directly involved in destroying the chinese economy during the 19th to early 20th century.
US, UK, Japan, France, Germany, Russia (a few of the top offenders).
These nations can't simply commit a bunch of crimes, get rich, change the rules, then expect to be protected from past actions.
How far back does this analysis have to go before it can be seen as the nonsense it is. If my father/grandfather, etc., was executed as a serial killer, what's on my own charge sheet? Nations don't commit bunches of crimes, people do and eventually they die.
> These nations can't simply commit a bunch of crimes, get rich, change the rules, then expect to be protected from past actions.
They do it all the time. When will the Chinese Communist Party pay for the famine which killed 2-6% of the population (lower bound is based on official government figures)? Probably never is when.
A more interesting tactic would be to make economic sanctions dependent on values-based policies. Stop censoring certain kinds of speech, and we'll lower tariffs a bit. Stop persecuting Uighurs, and Huawei can have Android back. Strongarm the communist party into being less evil, instead of bluntly attacking China as a whole. I think most of China's people would pressure its government to agree to those kinds of deals. It's really just those at the top who are doing all the bad stuff. The rest are just excited about their newfound prosperity and want to hang on to it.
I don’t disagree, but sadly our current government acts in a purely self-interested way- or in the interests of our ruling class anyhow- and any talk of doing what’s right by any administration in living memory has been insincere. But ideally I see what you’re saying.
This is more an outsider's imagination. The communist party will never make this kind of deal with you. Bringing this kind of topic to the table will immediately make them walk away.
Right now the US administration is limiting the trade talk within trade talk, avoiding politics. However, if the trade talk really falls apart, I have no doubt the conflict will escalate and politics will be openly involved.
You can't sanction major economies without hurting yourself. It's why sanctions are used on nations with weak economies. Systematically important economies like the US, EU, China, Japan, etc are "unsanctionable".
Sanctioning china for "values" is as absurd as china sanctioning the US for "values". How would everyone react to china sanctioning the US or Europe for invading much of the middle east and north africa. Everyone would laugh.
Also, sanctions are acts of war at best and war crimes at worst. Economic sanctions exist to starve and hurt the population to punish the government. By any objective measure, it is a war crime and crime against humanity. "Luckily", rules and laws don't apply those with the greatest weapons.
Also, I highly doubt most of china's people would side with the US against their own government. No more than we'd side with China over the US government. That's not how people work. Especially if foreign government are attacking your own government.
Either we go to war with them or we decide to live with them. China has 1.4 billion people. The idea that we'd pressure them to act a certain way is ludicrous. More than anything, it'd probably have the opposite effect.
> I highly doubt most of china's people would side with the US against their own government.
Every week there's another article about a new way Chinese citizens are circumventing their government's censorship. Nobody likes being kept under heel. And I seriously doubt the concentration camps would have widespread support - most likely their existence is censored from the rest of the population altogether.
They wouldn't be siding against their own government, they'd be siding against the authoritarian communist party. They'd be choosing things they really want (economic growth) in exchange for the ending of actions they either don't care about or dislike. The CP is already in a precarious balance, trying to maintain strength without turning the general population against them. Some in China already wish it would bend to the sanctions. The above kind of deal would raise the pressure on the party, weakening the tumor sitting on top of a major new contributor to the world economy.
Really? Censorship? And here in the US, people are trying to circumvent censorship too. So what? Doesn't mean we are going to side with china over the US. Also, there have been articles of china's demise for decades now. If you enjoy cringe, look up gordon chang and read some of his stuff.
But I agree with you about nobody wanting to be kept under anyone's heel. Do you know any chinese history? Do you know whose heel's they think they've been under for 200 years? The west's heel. Nationalism and economic growth is how the chinese government maintains power and I don't see that changing anytime soon.
As for the "concentration camps", I'm guessing the support depends on how it is framed. If the chinese government frames it as punishing separatist terrorists, I'm betting it will have as much support as japanese internment had in the US.
Also, the authoritarian communist party is their government whether you like it or not. Considering the economic growth that china has experienced, I'm betting the party and the government has enormous support amongst the population. And in any confrontation with a foreign government, the people almost always rally around their government - authoritarian or not.
Finally, "some" in china might want their government to "bend to the sanctions", but I'm guessing the vast majority of chinese don't. Also, historically, governments tend to fall when they appear weak, especially in relation to a foreign power. Also, you are conveniently ignoring the fact that there are "some" in the US who think we should "bend to their sanctions".
If you think that chinese people are going to side with a foreign government against their own ( authoritarian or not ), then you really don't know history or human nature.
> And here in the US, people are trying to circumvent censorship too.
I don't know what you're talking about; the US is the least-censored country on earth. You can't even pull provable, inflammatory falsehoods off of Facebook without people crying censorship here (which is its own problem).
> there have been articles of china's demise for decades now
I'm not talking about its demise. Quite the opposite. I'm talking about its people being smarter and more worldly than they get credit for, despite president Xi's very best efforts to the contrary. It has academics who are regularly imprisoned for criticizing the government and advocating for personal liberty. Scores of people cheat around the latest propaganda app (https://www.nytimes.com/2019/04/07/world/asia/china-xi-jinpi...). People use GitHub, for lack of better options, to exercise some small amount of free speech (https://www.npr.org/2019/04/10/709490855/github-has-become-a...).
There's a will. Chinese people don't want this kind of country. Many of them have just given up fighting it. We could help.
> I'm betting it will have as much support as japanese internment had in the US
Japanese internment has been looked back upon as one of the greatest human rights transgressions the U.S. has ever committed. It wasn't at the time, of course, but that can't be helped. It's also beside the point. I'm not saying "America is good and China is bad". I'm only saying, Xi's ruling party is bad. America has done some bad things too. It's still doing some bad things, like what's happening at the southern border.
Maybe what you don't grasp is that Americans are free to criticize their own government. We can have our own sets of values. I have a pretty low view of my own country right now. That doesn't mean I can't also point out China's problems and America's opportunity to do something about them. Of course, I also have very little faith in my government to take that kind of opportunity right now.
I didn't say the US is the most censored country. I just said we have to deal with censorship here too.
Once again, you harp on censorship. I'm against it too. But what does that have to do with what we are talking about? I don't like censorship in the US but that doesn't mean I'm going to support the chinese government over the US government. For some strange reason, you seem to believe that just because people don't like their own government, they'll support foreign governments. That's not how life works. Every citizen in every country has gripes against their government, but that doesn't mean they would welcome foreign intervention in their own country.
And if the chinese people don't like their government then let them deal with it. Not sure who you are or what your agenda is that you think "we could help". Who are "we" that we have to interfere in other countries?
I'm american. I complain about the government, the establishment press and censorship all the time. What are you? You seem to claim to be american but want to "help" the chinese people overthrow their government. And for someone who claims to be american, you seem to claim to know how the chinese think and want. I suspect chinese people know what chinese people think and want. It's as strange as a chinese person saying they know what americans think and want. How would they know?
Your use of the term "evil" says a lot about the warped Western perspective. Without diving too deeply into pedantry, it is the West that claims the cognitively dissonant idea that religiosity is subject to the State while also demanding the State act religiosly (just wars, responsibility to protect, etc.). For all the pseudo-commie bluster, China is a Han ethnostate. Lies that benefit the State are just. Brutality that protects the State is just. China has decided that a Muslim population in its borders requires brutality, and this rubs westerners wrong. China has decided that mass surveillance should be open and accepted, and this rubs westerners wrong. But the West is very comfortable with destabilizing Ghadaffi and instigating regional chaos, which was and continues to be incredibly brutal. The West appears to be quite comfortable with mass surveillance so long as nudes abound, food arrives at our doorsteps, and ideologies we collectively find icky are suppressed.
Moralising is a habit of those who lack the strength and/or will to get what they desire through other means. The West dethroned its warriors and elevated its priests; China is dethroning its priests and raising up its warriors. Time will tell which class of leader shall overcome, but history is pretty clear about what kind of societies rise or fall.
Speak for yourself. I'm not comfortable with mass surveillance. There's little I find intolerably "icky". It's not even the "Communist" in China's Communist Party that I see as evil; I consider myself a democratic socialist. The fact that I live in a flawed society doesn't mean I can't condemn blatant censorship and concentration camps. Honestly, parts of your comment make you sound like a sociopath.
It's not exactly sociopathic to point out the hypocrisy of the US standing on some kind of moral high ground while blowing up whole countries and killing millions of people directly or indirectly.
> Moralising is a habit of those who lack the strength and/or will to get what they desire through other means.
America isn't a very good world citizen in 2019. I honestly wouldn't take issue with a different world power taking the lead if its ruling party weren't even worse. But rest assured, the people in charge of China right now are indeed worse. And my own country's problems don't change the atrocities that they commit.
Democratic Socialism is socialism, and socialism always finds a way to murder people and increase poverty in the name of equality.
Socialism is a deeply religious belief. It has its priests (professors, journalists, entertainers), its churches (campuses, museums, protests and benefit rallies as outdoor/big tent revival analog), its core beliefs predicated on faith that unite the fervent and ostracize the skeptical (diversity is always beneficial, climate change is the fault of the successful, racism is original sin, privilege creates winners and losers in spite of actual value, religions of the oppressed are blameless, etc.), and its intangible and perpetually just beyond The horizon utopia. In every important way, socialism is a religion. It has a general hate for "gods" which functions as a smoke screen for the incorporation of American Protestantism into its modern day Progressive skin suit.
You can see the energy of the faithful when technical questions are provided emotional responses, when differing opinions about generalities are met with personal assertions regarding psychological well being ('burn the hetetic' transmogrified into 'you need medical attention because you have (x)-pathy), and, always everpresent in Leftward arguments,appeals to authority that the one appealing doesn't recognize.
US-style “democratic socialism” isn't consistently, except perhaps from a cladistic viewpoint; a lot of it is substantively social democracy which is more of an ideological commitment to the modern mixed economy then an actual socialism.
> and socialism always finds a way to murder people and increase poverty in the name of equality.
I think (assuming you are arguing in good faith) you are falsely generalizing from Leninism and it's descendants with socialism. While at least cladistically a subset of socialism, Leninism and it's offshoots is a narrower and particular subset from which generalizations about the broader set cannot validly be drawn.
Thank you for the well worded responses. I was responding in good faith, and herein also.
>isn't consistently
This is the beautiful thing about socialism. It need not be perfect, or even dominant. It just needs a foothold. From there, it is purely a game of time. Put another way, socialists wait for other viewpoints to come around to theirs (Christianity, Academe, Business) or disappear. They do not become Less Left.
>cladistic
Ah. See you too are a person of depth. Yarvin's work on the neo-Protestant clade is exceptional but not for the faint of heart. I recommend Spandrell's Bioleninism piece.
>falsely generalizing
A salient point. Where are the gulags of the social democrats? Where are the legions of thought police? Where are the desperate informers turning in their neighbors? I know this will be an ugly statement, but I believe the mass murder inclination of socialists is more than saitiated by rampant abortion. It fulfills the same methods and motivations of Holdomer and any other incident of mass death from Lenin or Stalin or Pot or Mao; the greater good. People often forget that the motivations behind the mass death perpetrated by these men and, more importantly, their regimes always had a logical source, for some definition of logic. Socialism doesn't cause mass murder; it justifies it. And to the socialist society, the justification is always good.
>socialist religiosity
So what? Capitalism is faith in the selfishness of man. Socialism is faith in the rightness of good. Cargo Cults use the same parts of their brains for reasoning as Catholics. The question, for me, is not the How, but the What. More directly, To What End and For What Purpose. Objectively, the merit of capitalism vs. the merits of socialism a matter of historical record. Put another way, the same god concept that causes a genocide can also cause, quite literally, science. Equivocation has its value, but in the frame of your chosen context it is relatively valueless.
I point out the religiosity of socialism not to say it is singular, rather to demonstrate that it is typical.
Disagree. Capitalism is faith in the fairness of man. Each person in a capitalistic society has the same opportunity to take advantage of the free market and create their own wealth in a way that doesn't infringe upon the rights of the rest of the people in that society. These rights are guaranteed by the society, regardless of person.
Socialism (such as that in China) does not afford its citizens such equal rights. In fact, the Chinese government has very recently instituted controls which allow them to have a high degree of control over the rights a particular Chinese citizen can exercise. These rights are allowed, regarding person.
Why would you? The zealous are continually perplexed by the lack of natural conviction they witness. I am adamant in my interpretation, but I am very aware of how much of an edge case my perspective seems to be.
Would a loophole be China labeling them as “enemy combatants” and then drone striking them? [1]
> In 2014, former CIA and NSA director Michael Hayden said in a public debate, “We kill people based on metadata.”
> According to multiple reports and leaks, death-by-metadata could be triggered, without even knowing the target’s name, if too many derogatory checks appear on their profile. “Armed military aged males” exhibiting suspicious behavior in the wrong place can become targets, as can someone “seen to be giving out orders.” Such mathematics-based assassinations have come to be known as “signature strikes.”
I have this constant feeling that life on Planet Earth circa year 2000 or so onwards is playing out kind of like a bizarre imitation of the old movie Lord of the Flies. To me, it feels like everyone is absolutely batshit insane. Everyone (well, mostly) is so sure of themselves, so sure of what is right and wrong. As if life is so simple.
It seems to me that the rate of scientific progress has vastly outpaced that of the humanities (or, whatever is the appropriate "balancing" field to science) for so long that humans have become a danger to ourselves, for a very long time now, on several different fronts. We are simply not mature and responsible enough to be wielding this much power, yet here we are. And there's very little reason to feel very optimistic, that I see anyways.
> I have this constant feeling that life on Planet Earth circa year 2000 or so onwards is playing out kind of like a bizarre imitation of the old movie Lord of the Flies. To me, it feels like everyone is absolutely batshit insane. Everyone (well, mostly) is so sure of themselves, so sure of what is right and wrong. As if life is so simple.
Apart from scientific progress, what has changed? Humans gonna human.
This is my feeling as well. Good to know I'm not alone in this... however, it's still limited comfort since we're all probably screwed, as someone else had already pointed out.
Our values are so far skewed towards progress that actually directing that progress to be beneficial to all is almost an afterthought (or, work that most people aren't really allowed to contribute to). People also aren't rewarded for what they _didn't_ do, and as long as nothing changes we'll continue to motivate people to build with more or less reckless abandon wrt social impact. Investigating correct usage of power isn't immediately profitable, and in a capitalist reward system it's hard to see how that work would get prioritized to the same level as simply increasing power.
I'd never thought of this balancing of progress perspective, thanks for such a thought provoking comment!
The author is correct in saying that China fired the first shots in the trade war with effectively shutting out major US companies with its protectionism, while China's expansion into the US went on unrestrained. If this process continued on unchecked, China would definitely replace the US as the world power. China is an authoritarian state, with core values that are at odds with the US. Therefore, the stakes could not be higher, and now could very well be the last time that the US has enough leverage over China to actually come out on top.
Don't worry China won't be alone soon India will be in the same rank for authoritarian rule where everything will be monitored and dissent will be termed anti-national with secession laws applied and people jailed. This is the path India's current administration which might come back again, learned from China and using British methodology of divide and rule (dividing India along religious lines by letting people know where the cabinet is going for holy bath or pilgrimage).
>while China's expansion into the US went on unrestrained. If this process continued on unchecked, China would definitely replace the US as the world power.
pretty much any projection, from consevative to optimistic implies that China will replace / supplement the United States on a 'several decades+' timeframe, so the aggressive stance taken by the US on a election cycle basis strikes me as unwise. At the end of the century Asia will be the center of the world.
This is one advantage that China always had over the US, politicians in the country are able to think in 40 instead of 4 year intervals. And given that broadened context, poking the bear now simply to delay their capabilities by a few years seems like not such a good idea.
China isn't thinking 40 years out. That's the greatest myth running about China's authoritarian system. There are few governments more obsessed with day to day sentiment and short-term thinking. That's why they have to control their people so tightly and they constantly watch everything going on socially for the slightest aberration. Everything about China is at risk of implosion at all times, that's why the authorities there behave as they do (from social credit, to wiping out other cultures, to aggressively limiting social variance, to extreme debt binging, to fear of basic human rights and expression, to perpetual economic stimulus, to their hyper universal surveillence).
China talks long-term, that's it. The USSR used to talk long-term in their propaganda too, it was a fraud. Watch their actions instead. There is a mountain of evidence that they aren't actually acting long-term. See: their taking on the greatest-fastest pile of debt in world history over the last 10-15 years. They did that to satisfy extremely short-term thinking about social instability. There can be no greater example of short-term thinking for such a system, than to trade extreme debt to fake faster growth for a bit longer, rather than plotting longer term in a financially healthy manner and accepting slower growth.
In terms of being unwise. The US doesn't need foreign countries, including on trade, nearly to the extent that China desperately needs foreign trade. When ranked globally, the US is among the least trade dependent major nations, and that provides an enormous bargaining position. China derives roughly 10x the growth impulse from each dollar of US economic growth, as compared to what the US derives from China.
It is in fact wise for the US to confront China right now, precisely because the US does not need China. There are dozens of countries that net can replace much of the manufacturing that China handles for the US today. China knows this, it's why they've responded very carefully to US tariffs, they recognize there is a vast imbalance.
China is in a precarious position today. They have all the debt of the US, with barely any social safety net (which will make their debt, tax and budget situation far worse), bad demographics, twin deficits (trade and budget), a smaller economy that is extremely rigid and one that is prone to frequent wrecks that must be constantly corrected by the central government with large stimulus programs. The system is clearly not working very well. There's zero proof thus far that Xi's new, highly regressive system will continue on the path of long-term economic expansion and success, now that Deng's system is formally dead. They may very well crash into a wall of stagnation under the new anti-Deng, anti-liberalization approach. It'll take many years yet to find out either way. I happen to not believe the new Xi system is compatible with furthering the success that the old system produced.
To compare China to the Soviet Union seems to me very erroneous. The communist party has survived communism itself, which the Soviet Union did not manage, it has survived Deng's reforms towards a more market based economy, and now it apparently evolves into something else again, whatever that is.
So to characterise a system as rigid that has shown the ability to absorb more shocks than just about any other political system on earth and still come out intact and relatively, if not highly functional is probably a huge mistake.
And it's true that all this thought control stuff and the Xi smartphone apps aren't serious long term politics, but they're also not really evidence for the opposite. Politically China has still a lot of old cadre who thinks they can brainwash the population with Soviet era propaganda, but in contrast to the USSR I'm not sure how seriously the leadership itself takes this or merely runs with it because it's the motions you go through in these authoritarian systems.
And concerning the last part about stagnation, how often have we heard this now? China is always five years away from being five years away of succumbing to its politics. It's almost an unfalsifiable belief at this point. You say that it'll take many years to find out, but is there a point in time at which you're open to change your outlook? The issue I have with this view is that it almost feels like the roles have reversed. People in liberal democracies want to exercise foreign pressure and maintain the system solely on belief in the system itself, rather than admit that we're in a phase of competition between political systems (which ironically was supposed to be the arena where liberalism wins on merits)
I agree with the article that the US can damage China's economy for several years by restricting components (but that it also will eventually be able to domestically produce the components required). I also agree with the article that doing so would hurt the US companies that produce the components that China no longer could buy.
What I don't get, is what specifically will be achieved by doing this? How is the US coming out "on top"? I get that China has different values than the US, but I don't understand how restricting components fixes that.
It is not just about chips. This is probably the golden opportunity for the US to cripple China's export and push China into longer cycle recession which is long overdue anyway. That would cripple Chinese economy for next 20-40 years, give way for social problems and give the US and the rest some breathing space.
The other scenario is that Trade War will lead to real war (possibly by proxy). The situation is quite similar to pre WWI with China being in a role of Imperial Germany with fast growing economy, teritorial demands and unstable ruler. That war could also stimulate the US economy.
These are pretty dim scenarios but surely someone in Washington is thinking in terms or real-politik. In Bejing they do.
> What I don't get, is what specifically will be achieved by doing this? How is the US coming out "on top"? I get that China has different values than the US, but I don't understand how restricting components fixes that.
I'm just speculating, but it could perhaps hurt the desirability of their advanced exports on the world market, and create space for other countries to fill the void. One of China's current political advantages is that it's the current "workshop of the world," and if that's reduced they may end up being less influential.
It's unlikely to affect the domestic political situation there, but that may be a lost cause for this generation.
So to use a specific example of what I think you are saying about restricting components making other countries more influential: Huawei can't buy Qualcomm chips, so they use Chinese chips instead (which are inferior for several years before they catch up), so they are less competitive in Europe and Samsung sells more, which causes Korea to have a bit more worldwide influence compared to China over that several year period?
That seems plausible, but also pretty speculative and it seems like there could be negative consequences too. For example, if the Chinese market switches over to Chinese chips, a lot more money will be invested in Chinese chips and they will probably develop more quickly. Normally the US complains about China blocking US products, the US blocking US products seems a bit less usual.
The article points out that there a problems with China, and points out that there is a policy available that will hurt US companies and Chinese companies. I feel like I am missing the part though, where this policy fixes the problems with China. I feel like I need to understand that part before I am convinced that this is a good idea.
> That seems plausible, but also pretty speculative and it seems like there could be negative consequences too. For example, if the Chinese market switches over to Chinese chips, a lot more money will be invested in Chinese chips and they will probably develop more quickly.
Those negative consequences presume that the Chinese won't have the goal of switching over to domestic chips if they have access to American chips, but I think that's false. They've shown a strong desire to pursue import substitution and then turn those companies into international competitors. Denying the American supplies forces them to switch before they're ready, rather than when they're fully ready.
It's also not guaranteed that the Chinese investments will bear fruit. For instance, China has been trying to acquire modern jet engine technology for decades and decades, and still hasn't succeeded. IIRC, jet engines and microchips have a major characteristic in common: most of the magic is in the manufacturing techniques and those are difficult to reverse engineer from finished products.
Chinese environmental and demographic problems are a ticking bomb. I doubt they will be in anywhere like better position than now 10 years down the road.
For all the insane crap happening in the U.S., it has healthiest demography among all (large that is, not counting say Israel) developed countries.
Is there a resource where we can check the current state of tariffs between the US and China? Which tariffs are currently in effect? Which tariffs are on their way? Whats their status? etc.
IMHO, tariffs is meaningless when it comes to trading with China. China govt should simply stop requiring foreign firms to partner up with local firms and/or placing arbitrary restrictions on imported products. Sure many nations do it, but China is an extreme case.
Edit: I got downvoted but what part of my statement about China incorrect?
This doesn’t include the fact that all foreign enterprises in China are actually 51% owned domestically. Tariffs, while severe, are no where close to this extreme protectionism.
The US finally decided to bring a knife to a gun fight.
what are Apple/Microsoft's domestic partners in China?
note that, not talking about Apple's data center partner or Microsoft's cloud partner, just talking about Apple/Microsoft's core business (iphone, mbp, windows, office etc) here.
They are absolutely blocked (with the possible exception of Github).
> refuse to comply with Chinese censorship laws
And Huawei refuses to comply with US economic sanctions laws.
> Not blocked in China ...
The fact that some US companies do business in China is not evidence of anything.
It should be obvious that China denied access to their markets and severely restricted the operations of far more US companies than the US has of Chinese companies.
China's attempt to portray itself as a victim in a trade war is transparent bullshit.
Does China gain an advantage, by not using / having access to the same services that the whole rest of the world uses?
If they're gaining an advantage that's one thing. I don't want to just take that assumption for granted though. If China is actually harming themselves, I think it might not make sense for the US to copy them because "they did it first".
> Does China gain an advantage, by not using / having access to the same services that the whole rest of the world uses?
This is how they gain advantage from that: they develop their own domestic services that their government has total control over. Eventually those services may become good enough to become competitive exports.
If you want to have globally competitive companies, I'm not sure protecting them from global competition is a particularly effective way to achieve that. Brazil has high tariffs on computers etc but that hasn't caused them to develop a competitive tech industry.
You're looking at the companies themselves but I think it's also worth considering the users too. If the rest of the world uses Github but China uses a Notgithub that otherwise couldn't compete, that's good for Notgithub but probably bad for the rest of the Chinese tech industry. Just like in Brazil's case, their computer tariffs are good for their domestic computer industry (if it exists), but bad for any other industry that uses computers.
It's certainly not obvious to me that protectionism is an overall win. Even if that were the case, the proposal is actually to block US components from China, so it seems like it should support any Chinese competitors for those components since they don't have to compete against Qualcomm etc anymore.
> Does China gain an advantage, by not using / having access to the same services that the whole rest of the world uses?
Of course. Back 15 years ago, no one was developing any serious systems in China, US companies obviously refused to take any real tech to China from day one, what they offer was just some local sales/support jobs, on top of that, you might see a few app dev jobs which are always kept arm's length distance from the know how. By developing all those Chinese domestic services, local developers got the chance to actually working on some state of the art techs.
Yeah I've noticed Github works quite well but Gitlab works but is heavily throttled at night time. It's frustrating cause all of the GFW projects are hosted at GH
This is the only Trump initiative I support. Hope he doesn’t do his usual bow down to the aristocrat routine and back down for whatever reason he sided with Putin, Saudis. This is a fight that the US must win. The only issue is Trump picked fights with the EU and they probably will use that as an excuse to not help out. The fight with China should have been done as a coalition to begin with.
IMHO why can't both take one step back? Forbidding technologies flow leads to different standards in different countries. China forbode Google, Twitter, etc from rooting in China years ago, so China developed a totally different ecosystem than the rest of the world (basically) to take their place: baidu as search engine, QQ as IM, weibo as social media. This made Chinese hard to take a peek to the outside world, while the outside world also has a hard time peeking in.
And now US is doing pretty much the same. Just when Chinese companies are trying to develop overseas business, US bans them. And as people from US and China cannot communicate, hatred grows and lotsa Chinese are now volunteering to ban foreign products. This is truly meaningless.
The whole point of the West's policies is to increase competition at the low end of the labor market (manual, commodity, factory) while maintaining protectionism at the high end (intellectual property, media, culture, and technology), which is not coincidentally where elites are concentrated. The idea is to keep the price of labor as low as possible (to maximize profit for the owners of enterprises).
How does the West's policies increase competition at the low end of the labor market? By your argument, the West is harming itself by cutting off access to cheap Chinese labor.
Are you sure that's the whole point? Undisputed superpower of the world isn't exactly a minor detail, I'm pretty sure China has that at least in the back of their minds.
I see China moving to appease the Americans in the short term and then working to secure their economic independence in the long term. The truth is that the Chinese know that they have overplayed their hand here; that Trump can raise tariffs all day long and it is foolish to race to the bottom with him. By making the requisite concessions in the trade war, which, as Ben noted, has historically been tilted to their favor, they will be able to steady their economy as they continue to build up their advanced technology infrastructure.
If the China tariffs last too long, it seems logical that supply chains will move outside of China. This might be ok for China, which is purportedly looking to pivot to a consumer based economy, but it might not be on their chosen timeline.
What are the aspects of the current economic relationship with China that are beneficial to the US, and what are the aspects that are harmful.
What policies should it adopt to manage its relationships with China while maintaining its values. Whether it should act unilaterally to achieve those objectives, or coordinate with its allies.
What are the near-term and long-term consequences of Cooperating with China vs. Competing with China in a new cold war, considering China's power will likely rise in comparison with the US's.