Who Owns Huawei?
papers.ssrn.com
papers.ssrn.com
Essentially the state decides, let’s say high tech cutting edge batteries for storing renewable energy is where they want to invest in. They gather a few companies into a building that can do it or are interested. They then have state representatives who effectively ask “what do we need to know” and “who are the major players in the field.
In a month or so they come back again. They do big closed door presentation for all the companies in the building. Suddenly all the Chinese companies in the space start delivering R&D and eventually products that match some of the best stuff being done in the space. You could almost say they’ve learnt to copy it..
How do they do it? Industrial espionage, essentially, and building an industrial and intelligence infrastructure that allows for maximum impact of the state’s intelligence apparatus into the national economy. In a way it’s kind of brilliant.
I heard it described by an NSA analyst in a very interesting talk. I thought it was fascinating and speaks exactly to your point. The idea that we are competing with “free market” Chinese companies is a fiction that we’ve made up in our own minds. It’s just not how China works. And to be fair it’s been working gang busters for them.
edit since someone asked for it, here’s the talk - https://cybersecpolitics.blogspot.com/2017/04/fusion-centers...
My description was from memory so I hope I remembered it right.
Is this talk available somewhere? I would like to hear that!
Looking for it right now tho is beyond my capabilities - I am on mobile and it’s 4Am where I live..
Most of the talk is centered in which cyber capabilities each country has and how they use them. He said interesting stuff about the Russians allowing a lot black hat hacking to go on - as long as it’s directed elsewhere. Then the state uses them agaisnt adversaries when needed. Lots of interesting stuff.
Here it is, just found it. My description was completely from memory so I hope I told the story right!
I think it's a little misguided to say that China's innovation is solely due to corporate espionage. States have always been effective at spurring innovation when it's needed. We only need to look as far back as America's highly productive and innovative war economy to see that
What does that have to do with what OP is talking about?
>"The idea that we are competing with “free market” Chinese companies is a fiction that we’ve made up in our own minds"
this fiction applies to a significant degree in the United States too.
But Apple also sued Samsung for using rounded corners on a phone. So there's a lot of gray area in IP enforcement.
A similar non-chinese example is the AV1 codec from Google or the Android compatibility with Java. Both are claimed to be IP theft by other western parties. I don't think either of those claims hold up, and I have no real reason to believe that China's violations are any more morally suspect without a lot more specifics.
Modern IP enforcement has left me in a "boy who cried wolf" mentality when it comes to infringement. To be honest I'm more scared of China playing that game in a hardball manner than I am of them ignoring it.
These Chinese companies literally clone the entire product. Entire businesses are based off theft.
It disregards the whole process that is required to take insights from research into a real product.
Yes, the internet was developed by the military. Only when private enterprise took over did it become valuable to society as a whole.
Yes, the iPhone builds on technology that originated from public research, just like all the cellphones before it. However, it wasn't a government committee that decided how to assemble all these technologies into something that people were ready to pay $1000 for.
We have lots of evidence that that the government is in fact a terrible entrepreneur that builds terrible products and services. One can point at the awful primary/secondary education, or at the DMV, or perhaps at the rollout of healthcare-dot-gov.
Even the "communist" Chinese government understands that private enterprise is the way to economic prosperity, it just disagrees on the degree of state control.
Not necessarily, or at least it doesn't readily compare. Sure, if I first have to develop all the physics dating back to Newton on my own, building a piece of electronics would be very expensive.
But let's say some researcher at a university discovers the field effect that could be useful for semiconductors. That researcher's lifetime salary will likely be far smaller than the cost required to actually bring their findings into the actual microprocessors.
> So we need both steps for progress, both the government trowing tax payers money on seemingly silly R&D, and entrepreneurs looking for new ways to monetize it later.
If we're talking about massive infrastructure projects, I agree that there's no one else but the government to do it. Whether those projects are warranted is a different matter.
However, if we're just talking about university R&D, it's not clear to me that if it wasn't for the government that it couldn't be financed. A university attracts students (and thus financing) in large parts because of its research.
The US industrial revolution was kick-started by IP theft as well: https://www.history.com/news/industrial-revolution-spies-eur...
Would you do any different if you were in charge of a country and your people need to eat? "Sorry starving peasants, we must respect international IP law"?
They do it, and most of their people still can't afford to eat.
Sounds like magic if you have ever met government bureaucrats.
It's at 36 minute mark
I know some may reply that, for example, Lockheed effectively lives at this nexus also. It’s a good argument, and probably similar though not exactly the same in arrangement.
To me, the most interesting difference is that China has this kind of relationship with its major players regardless of industry, not just their defense contractors. So it doesn’t matter if you make cell phones, video games, toilet seats, ship hulls, or concrete—the whole concept of an enterprise not being interdependent on the state is a non-starter there. Whether it’s happening via backchannels to party officials or through ownership schemes like this one, the concept of private and public sector is so muddy there as to be almost meaningless.
To me, this tells us a lot more about IP infringement and espionage than what we usually read, because where the west likes to conceive of corporations as competing in a market in China it’s more useful to describe corporations as tools of statecraft.
Huawei wants us to think of them as competing with Apple because they both make cellphones. In reality, it’s as though the CIA or Mossad was competing with Apple—the aims of each may in fact be orthogonal to each other because market performance is not the real driver of the company’s decisions.
edit: I spoke with a Chinese student once, whom preferred the term dictatorial capitalism.
https://en.m.wikipedia.org/wiki/Socialism_with_Chinese_chara...
Slightly off topic but can you clarify what 'social ownership' means, exactly? I've been trying to figure this out for a few weeks now. I just ask since you seem to know.
Wikipedia says, "The two major forms of social ownership are society-wide public ownership and cooperative ownership." What's the practical difference between 'society-wide public ownership' and government ownership? The government is supposed to represent the people.
What's the practical difference between 'cooperative ownership' and corporate ownership? A corporation is just a group of shareholders, often including millions of individuals and employees of the company.
e.g. In America the government owns parkland, and people can use it. Is that 'social ownership' of the parkland? Or 'government ownership'? What's the difference?
e.g. In the West, many corporations are owned by millions of shareholders. Sometimes the majority of ownership is ultimately from small shareholders, largely through pension funds. Is that 'social ownership' or 'corporate ownership'? What's the difference?
What are some existing, real, sustained examples of 'social ownership' in real history?
I feel like this term is either super general and not particularly meaningful, or it's one of those cases where the definition changes according to the argumentative needs of the moment, or it's just a euphimism for government control without a practical difference.
Typically, socialists (and even market socialists) contend that the current democratic establishment does not represent the people, usually going off Lenin's conception of "bourgeois democracy". This is also behind the most common Marxist rejection of achieving socialism through non-revolutionary means. Compare, for instance, how Lenin described what he figured Soviet Socialism would turn out to be - control by the soviets, not by the state. Of course it didn't really turn out that way, and in Economic Problems of the USSR, Stalin effectively admitted as such.
>What are some existing, real, sustained examples of 'social ownership' in real history?
This is a difficult question because one would either have to draw from pre-capitalist modes of production to answer the question, or one would have to argue that the USSR/Stalinism implemented such social ownership. I have already described why the second is not appropriate (see here[0] too) but the first is also not appropriate because "social ownership" is not a transhoistorical term, it was intended to describe a future mode of production in which it is one of the components of socialism (market or otherwise) - its applicability, therefore, does not encompass pre-capitalist or capitalist modes of production. For the notion of the critique of transhistorical categories, see Marx's discussion on the "Robinsonades"[1] and Patrick Murray's argument on Marx's improvement over David Ricardo and Adam Smith[2]. That said, you would probably have to look deeper into anthropology to find if such a society did indeed exist - that is to say, a society in which as far as we can tell today the will of the producers themselves was actually reflected in the ownership and control of the means of production and its products.
Finally, a note: Marx himself, to my knowledge, never used the term "social ownership". In fact, his argument against Proudhon was that plain "social ownership" results in a state where "society becomes a general capitalist". The term was used by Engels once, but he quotes Marx as follows:
>Marx assumes on page 56 “a community of free individuals, carrying on their work with the means of production in common, in which the labour-power of all the different individuals is consciously applied as the combined labour-power of the community[3]
As such, I tend to avoid using the term, as do most academic Marxists.
[0] "On the Question of Soviet Socialism" (2011) by Paresh Chattopadhyay, a rejoiner to David Laibman's thesis of the USSR having achieved "formal" socialism but not "real" socialism; (Chattopadhyay doubts that it even achieved "formal" socialism in the Marxian sense). https://www.jstor.org/stable/25769087
[1] https://marxism.csbs.utah.narkive.com/qeQK04SD/marx-on-robin...
[2] "Marxs “Truly Social” Labour Theory of Value: Part II, How is Labour that Is Under the Sway of Capital Actually Abstract?" Historical Materialism, Number 7 (Winter 2000)
[3] "Anti-Dühring" by Frederick Engels (1877), chapter XIII. Dialectics. Negation of the Negation; available here: https://www.marxists.org/archive/marx/works/1877/anti-duhrin...
Building affordable housing, sponsor of sport accommodations reflected some of Marx's reasoning with respect to sharing profits with society.
A century ago the silicon valley of the world was around the Philips factories and then somebody came in and decided to move the whole company to another place.
The point of social ownership ought to be that the people who either work in or directly rely on the organisation are the people who have meaningful control over it. This immediately excludes any kinds of pure owner who may never interact with the organisation other than for having decision making power over it and extracting profits from it.
Where worker co-operatives are concerned, an important aspect is that workers should have equal say (in the sense that voters in a democracy should have an equal say) over their organisations. Where corporations have 'one share, one vote', worker co-ops are 'one worker, one vote'. Of course in practice the nature of this varies - in smaller co-ops, the workers tend to have a more direct say over the operation of the organisation and in larger ones are more likely to just be able to elect board or committee members at the overall level, and more direct decision making for their organisational unit. All of this happens while workers retain all the same rights and privileges they'd be afforded at a traditional corporation such as the ability to leave and change jobs if they want to, so they get to have their cake and eat it in this respect but the cost is arguably more responsibility in the form of taking informed decisions.
A couple of examples of longer lasting worker co-ops: https://en.wikipedia.org/wiki/Mondragon_Corporation - large international co-op from the Basque region of Spain, in business since 1956 https://www.suma.coop/ - an equal pay worker co-op which has been operating since 1977
There are also other kinds of co-ops such as consumer co-ops where anybody who shops at a co-op can become a member. You also get community co-ops where residents directly, jointly own their own local accommodation or amenities. Some co-ops are hybrids.
The co-op group in the UK is a large, long running group of consumer co-ops which have been going since the 1840s: https://en.wikipedia.org/wiki/The_Co-operative_Group and they have nation-wide businesses including retail, energy, funeral services and so on.
Sometimes it may be one of the above types of ownership or a combination. Co-ops usually adhere to a set of principles called the Rochdale principles: https://en.wikipedia.org/wiki/Rochdale_Principles which define various rights for members and ultimately a culture that co-ops should adopt.
Building societies and credit unions are another form of social ownership where those saving with them are the members:
https://en.wikipedia.org/wiki/Nationwide_Building_Society - nationwide is a UK-wide building society dating back since 1846
Government control, where there is a functioning democracy, can be a form of social ownership. It is just a very dilute kind. It's easy for your voice to get lost in a sea of millions, but that does not mean it isn't there - things like FPTP and the electoral college notwithstanding... Everything owned by a democratic state would be "sort of" social ownership; just a very weak, undesirable kind that puts too much power in the hands of a small group of representatives. Nevertheless, there are certainly some cases where it makes sense such as things which are natural monopolies like water sources, rail networks and indeed in the UK the NHS enjoys wide public support.
In that respect, municipal/local council control is also a form of social ownership but is much closer to home. Municipal libraries, public parks, public restrooms and such for instance are very much in keeping with the principle of social ownership. Municipal socialism as a specific aim has become a goal of some places, for instance in late 2018 Preston was named 'most improved city' in the UK after following a programme with this aim ultimately by leveraging local institutions to improve the area: https://www.theguardian.com/politics/2018/nov/01/preston-nam...
When it comes to social ownership I think sometimes something gets lost in translation, like you get some people who seem to think that just nationalising everything fits the bill - but the truth is that the model you have to choose has to fit the problem the organisation is supposed to be solving at the right scale. Having your local park managed by a centralised state authority by somebody who has never visited is probably a horrible idea in pretty much the same way that having it managed by somebody who only wants to profit from it but has also isn't particularly attached to its use as a park for residents may be a horrible idea (or certainly would be seen as such by those residents, at any rate). All of these approaches are appropriate tools for the goal of enfranchising communities and workers to have decision making power over things that affect their lives provided they're used right.
Nevertheless, none of this matters if you're otherwise operating within the confines of some highly authoritarian nation-state that in practice can totally take the reigns of your organisation, effectively disenfranchising members or constituents from making decisions.
This is by no means universal though. Other Marxists would call it a "degenerated worker's state" or "bureaucratic collectivism" or just "Stalinism"
As others have pointed out, the traditional Western concept of the private-public division doesn’t exist in China. It is in fact similar to historical economic conditions in fascist Europe; specifically, the state-controlled labor unions (and ban on private unions), mandatory party cells within private companies, military involvement in commercial enterprises, and synthesis of the one-party state and a market economy.
I understand that some in the HN community are allergic to comparisons between fascist systems and contemporary societies. I understand they may downvote and flag such comments, and that this creates headache for you. I’m sorry for the headache. I don’t think I’m wrong, and I think my comment was a perfectly valid point to raise. If the sensibilities of HN readers and moderators will not tolerate it, then so be it.
By that premise, Norway controls Microsoft and Apple because they own part of the companies via their sovereign fund. Microsoft by itself of course is worth as much as Norway's entire fund.
Snapchat is a publicly traded company, of which institutional money representing primarily US investors controls the dominant position in the company.
Reddit is minority owned by Tencent, they hold a small share of the company. If you own 5% of a company the size of Reddit, you have close to zero control over the company.
Tencent also does not own a controlling interest in Epic. Tim Sweeney all by himself is estimated to control more of Epic than Tencent does.
Even so, Norway's political/ideological/moral objectives are in line with the west's. There is a difference between the Norwegians having some influence in something, as opposed to the Chinese.
While there may not be a grand conspiracy, it isn’t too far-fetched to suggest that organizations that specialize in espionage, sabotage and propaganda can figure out, or may already have figured out, how to pull the various levers at their disposal to achieve their goals.
It's the appearance of an organizing that is really taboo. Of course please take my opinion with a grain of salt. I am a foreigner who was there less than a year.
advchina/serpentza/laowhy86 are the canaries in the coalmine atm.
Sure:
How about a look at Reporters without borders, which ranks press freedom:
US #48 (behind Botswana, Child and Romania)
China #177 (of 180, so only ahead of Eritrea, NK and Turkmenistan)
Or this HRW report will be an interestjng read: https://www.hrw.org/world-report/2019/country-chapters/unite...
We have to remember there are two justice systems in this country and re-introducing slavery through the prison industrial complex was something we deliberately did without good reason.... not in response to dangerous extremism like in China.
This is a fundamental difference (and yes, America has detained people indefinitely without trial, but I would condemn that _too_, and they are a small minority of prisoners).
Furthermore, there are ~2.3 million _people_ in prison, of which 40% are black (39% white, 19% Hispanic).
Here's a major presidential candidate on the topic:
China has no freedom of speech, the press, religion, or assembly.
Also, is there a firewall that prevents you from accessing portions of the internet your government doesn't want you to see?
(I've never been to China but this is what seems to be reported.)
https://www.reddit.com/r/gaming/comments/93f04k/just_found_o...
Remember all those other generations of people living in crazy societies with crazy ideas? People's values, behaviors and loyalties are basically imprinted on them during childhood. There is an Einstein quote where he talks about how 'most people can't even form their own opinions' and he is right.
QED
Pretty much Nietzsche was the only guy who said you could make your own values.
Tencent is co-producing the Top Gun sequel, and Maverick's jacket no longer has either the Japanese or Taiwanese flags on the back:
* https://www.esquire.com/entertainment/movies/a28479683/
* https://en.wikipedia.org/wiki/Top_Gun:_Maverick
> Maybe it’s not as great as a nuke, but China can use popular video games to raise the next generation of kids to be more friendly to China.
K-pop seems to be helping Korea:
* https://www.vox.com/culture/2018/2/16/16915672/what-is-kpop-...
Though they're not a totalitarian state. I think if people get too friendly or sympathetic a couple of articles will bring reality back:
* https://en.wikipedia.org/wiki/Organ_harvesting_from_Falun_Go...
* https://en.wikipedia.org/wiki/Xinjiang_re-education_camps
* https://en.wikipedia.org/wiki/1989_Tiananmen_Square_protests
K-pop is increasing South Korea's power worldwide, although it might not be a fair comparison since SK is not a totalitarian state like China. If people get too friendly with China we will eventually be reminded of China's bad track record with human rights.
Do you see how meaningless this type of argument is?
Also known as the Japan strategy. Many have tried to emulate it, it’s very hard.
As a side note, ironically it seems like going for short trips there can sometimes illuminate less than reading on the subject or just knowing someone here with a foot in each culture.
I don't hear much geopolitical talk during business meetings nor while buying things at the market. I recommend buying a friend in the US (or wherever you live) lunch a few times. It can be a highly time-efficient way to digest the big picture and also subtleties.
Every company has different stakeholders, who have different interests. The German state of lower saxony has a 20% stake in VW. That doesn't mean that VW does not compete with other car makers.
It's soft power that results in similar outcomes. Look at Theranos's board, it's not as unique as people think when compared to other majors...
Does having a large % of ex-gov/mil/intel board members increase the likelihood of a company landing these contracts? I wouldn't be surprised, if true (for many reasons).
I learned this from Huawei's answer to the House Intel Committee in 2012. That committee produced a report which began Huawei's problems operating in the US: https://stacks.stanford.edu/file/druid:rm226yb7473/Huawei-ZT...
And yes, that applies to any company incorporated under Chinese law, even subsidiaries of Western companies (say Microsoft Research Asia, or Google China). How much power those representatives have depends on whether the company is willing to listen to them or not.
So it seems like the whole comment is a repackaging and a commentary on someone else's opinion. I think it's an interesting thought exercise but it's also hard to derive what should one take away from this after reading.
Chinese institutions are all unified under a single structure, and that structure is the Communist (in name only) Party. Party members are embedded in every single important facet of society. Education, the military, the government, the private sector, it's all linked and unified by the party.
Now, we can compare this structure to the mammalian neocortex. The neocortex incorporates inputs from lower layers of the brain to form high level abstractions and integrations.
The West is basically functioning without a neocortex. Our institutions are not unified. There is no integrating layer above the corporate sector and government. In fact they are often at odds.
What I am saying is that China represents an existential threat to the entire project of the West. If China is able to outcompete us with their more advanced (?) organization, we will be forced to copy them or become irrelevant. This would mean doing away with free democracies and instituting a ruling party - a neocortex - to oversee the entire society.
I am not sure this would even be possible in diverse societies like those of the Western democracies. There is too much infighting and tribalism, at least right now.
That does not bode well for us.
But it's possible that cultural unity within our democracies may be sufficient to align the different parts of society to allow us to compete with China, without the formal superstructure of an all powerful Party.
The trick is to design systems with checks. Well-run states have these checks, both in the state organizations themselves and towards other sectors. Even if you're rich, there are limits to what you can get away with in a Western society.
And yes, these checks are not perfect, defending against corruption is really hard.
As we get better at automation, unless we screw up in the Western world, I have a hunch we're going to end up with universal income and a Star Trek-like society, probably not that far from what Marx imagined when he was ranting about the horrible conditions for factory workers at that time. The trick is to make everything so cheap that the universal income is affordable for society.
On the one hand, I've heard that authoritarianism is soul-crushing and I've been raised to believe that individual freedom is paramount. On the other hand:
https://en.wikipedia.org/wiki/Metasystem_transition
I keep coming back to this idea of a society united by a shared telos that cuts across all racial and religious divides, acting together as a tightly-integrated social organism, a large-scale collective agent. What if this is the next stage of human evolution? Is there a way to embrace integration without stifling the uniqueness of the individual?
There's that fear of a Borg-like outcome, where diversity is annihilated by assimilation into the collective. But I was recently reading "The Phenomenon of Man" by Pierre Teilhard de Chardin (originator of the Omega Point[1] concept) and this quote stuck out to me:
"In any domain -- whether it be the cells of a body, the members of a society or the elements of a spiritual synthesis -- union differentiates. In every organized whole, the parts perfect themselves and fulfil themselves."
So perhaps integration doesn't necessarily mean the erasure of the individual. Food for thought.
The problem is everyone is not perfect. Power and wealth corrupts. And even if we are lucky to have the ideal situation at some point, no one can guarantee the next.
That's why we need separation of power: a system with checks and balances. I think as of now we don't have a equation to make the perfect system, but democracy is proven to be the best we've got so far.
You need to be aware that you're buying into a persistent pro-Western, anti-China propaganda.
If you survey a random sampling of Chinese citizens, the vast majority of them would in no way find the system they're living under "soul crushing". Yes, people of Xinjiang and Tibet live under brutal paramilitary rule and those issues have gained special salience in the West but they represent a tiny fraction of the Chinese population. If you happen to be a political advocate or trying to shed light on human rights, then the Chinese government is not a pleasant adversary (although again, the stories in the West focus solely on the worst cases. I know plenty of Chinese NGO workers who are fighting the good fight while playing enough by the rules that they've forged a productive partnership with the government). But, for the median Chinese person, the weight of the government rests pretty lightly on their shoulders as they just want to have economic opportunity, raise their children well and enjoy their lives.
I tell people that, in many ways, life in China is much freer than life in America. The Chinese system looks totalitarian from the outside but, from most facets, more closely resembles ungovernable anarchy. The CCP has been likened to the Eye of Sauron, overwhelming it it's power when it gazes on you but can only focus on a limited set of concerns at any one time. There's a reason why the air that the leaders breathe in Beijing continues to be extremely polluted and it's because the power the CCP has in Beijing province over factory owners in neighboring Hebei province is, by design, so limited that even Beijing Rulers can't clean up their own air.
For day to day life in China, there's a real sense of mind your own business, to each their own indifference which is both thrilling and terrifying at the same time. People renovate their houses in crazy ways and their neighbors don't care, I've seen empty concrete shells transform into functioning business in a matter of weeks as there's very little red tape you need to comply with. There's regularly blue trucks on the road that visibly fail China's emission regulations and are the cause of the bulk of the vehicle pollution but it doesn't matter because the trucking company knows how to pay off the right inspectors.
If you speak to most Chinese people, they're generally in favor of more government, not less because they feel Chinese society is too 乱 (messy) still and the government hasn't reached far enough into people's lives to provide enough of a civilizing force. That's one of the many reasons why, despite Social Credit being so derided in the West, it has largely broad support from within Chinese society.
There is no anti-China agenda. There is however an anti-medieval agenda, it has less to do with China as such and more to do with the mindset of the society and the ruling of the state. Most other societies have been through this already. China will also eventually.
For China, the system works by organizing the chaos by a strict rule, governed by single ruling party. In West, there isn't a similar chaos to be organized and most people behave quite amicably. Thus, strict oversight is not needed and instead decision-making can be distributed to the people, by allowing them to have their own way of influencing the policies and how injustices should be fixed. It's a bit like a difference between two types of swarm intelligence. In the other the actors are chaotic, and need a strict rulership. In the other, the swarm is more self-organizing and decisions emerge from the swarm through its individual actors. I know, not a very accurate example, but you get the point.
Furthermore, when Westerners think about authoritarianism we tend to look it from our own perspective, our own history. We have had our own share of dictators and authoritarian rulers, which none have worked for the benefit of the people. So it makes sense, that we would not think positively about a system which is by design, authoritarian. So while for the Chinese authoritarian means organization, for us, it means suppression of the population and killing of dissidents for the sake of keeping the ruling party in power.
And if you look further down history, we have had "good" authoritarian rulers like Frederick II or Charlemagne. Yet, we have abandoned those systems for the sake of parliamentarism and democracy. So why? My guess is, that once the basic needs of the population are satisfied we become less and less satisfied with the "small things". Small things meaning here corruption, free speech and worker rights for example. Once the general opinion becomes that "this thing is not right" the people require change, and if the system in place (here authoritarian or democratic) does not allow for that thing to change, the people will protest. Which is why all authoritarian systems, instead of exposing the system's weaknesses or problems, tries to hide them in order to sustain peace. In democracy the system works by _counting_ on people to expose those problems and that way, keeping the rulers (politicians) in check. Which in some cases fail miserably, when the general population becomes so deluded by the mass-media brainwash, that they can't anymore think for themselves and what's good for them.
But, I mean. Every system has its flaws. The purpose of the government still should be about the benefit of the people. When it stops doing that, it has become nothing more than a machine to keep the rulers in power and to suppress the general population.
I think the term shalmanese used, "ungovernable anarchy," is a fair description of Chinese culture. However I think you are mistaking this to also imply non-self-organization - which would be inaccurate.
Chinese culture values pragmatism over consistency. As a matter of pragmatism, the Chinese are cognizant of working cooperatively with other people in order to better obtain their individual or their respective families' goals. Families that work together survive together. To this end, in Chinese culture, people do often help each other out and look after each other like family. The Chinese aren't as unsophisticated ("non-amicable") as you think.
In this culture of ungovernable anarchy, individual agents grow up to be highly autonomous adults. You can see this manifested as immigrant Chinese entrepreneurship in places all around the world from America to Africa. The self-organization aspect of this culture are manifested by the numerous Chinatown communities in cosmopolitan cities around the world from New York to Montreal. These communities aren't led by any all powerful authorities - they are self-organized ghettos, sociological gems.
> instead decision-making can be distributed to the people...
Jordan Peterson once said something along the lines of how the more we clamor for autonomy, the more we also internally desire to be controlled - or something of the sort. I wish I could find the clip since I butchered that.
However, I'd say there are abstract kinds of tyrannies that people subject themselves in America. An example is how Americans are taught to follow laws, regulations, or processes even when they are inefficient, wrong, or don't make sense. The Chinese people are more willing to avoid these formalities because they may be more confident in deciding for themselves what makes sense.
In this way, the Chinese people can be said to have more freedom than Westerners because they don't subject themselves to a certain form of other people's control. Such a contrast makes Chinese society seem relatively like a self-organizing "ungovernable anarchy".
It might be true that after 100years of exiling and stifling dissent, the remaining Chinese and brainwashed youth fall in line. But the adults who escaped (currently aged 35+) tell a very different story.
In fact, that would give the beneficiary government a lot of incentive to advance your interests with something like a state-sponsored IP theft program and massive subsidies
Huawei began with simple equipment they could manufacture cheaply, made money, and have invested in R&D to move up the value chain. Recognizing that Huawei is an important Chinese tech company, the Trump administration is holding it hostage in the trade negotiations. Americans are now being bombarded with piece after piece of vague innuendo about the company, insinuating (without any evidence, of course) that it's secretly a state-owned spying operation.
That's another possibility.
That Huawei has engaged company-spondored IP theft has been widely reported, as well as the fact that the Chinese government widely disseminates the IP it obtains via forced technology transfers that are required to do business in the country.
The same examples are always trotted out. Huawei copied some extremely minor Cisco code over 15 years ago, and the two companies privately settled the issue, and Huawei engineers took pictures of the "Tappy" robot and took some of its fingertips a few years ago. If you compare these relatively minor incidents to the types of disputes other major tech companies have had, they're nothing. Google wholesale copied the Java API, and internal emails showed that senior executives knew this was potentially a legal problem. Samsung copied the design of the iPhone. Microsoft Windows' UI was largely cloned from Macintosh. The list goes on. Yet Huawei, which hasn't had any major IP disputes of this sort, is somehow the problem.
> the Chinese government widely disseminates the IP it obtains via forced technology transfers that are required to do business in the country.
This is not how things work in China. First of all, technology transfer is not required in most industries. Second of all, the companies that transfer technology do so willingly, because they believe access to the Chinese market is worth it. The Chinese government didn't put a gun to their head and tell them they had to open a factory in China. They benefit from cheap labor in China, and in return, China benefits from technology transfer. Companies wouldn't agree to this if they didn't regard it as a fair trade, and I don't see why it's unreasonable for a developing country to set these conditions on foreign investment. But again, these regulations don't cover most economic sectors.
However, I haven't seen anything to suggest that Huawei has benefitted from this sort of technology transfer. Again, claiming that Huawei has just looks like baseless innuendo, like so many of the accusations against the company.
You mean flat out copy Cisco and then undercut them in developing markets? In the early 2000s i remember seeing a Huawei manual that was a legit photo copy of a Cisco IOS manual with just the names blocked out.
Any evidence they copied Cisco hardware? Did they copy anything substantial?
Huawei's infamous approach to "acquiring technology" is undisputed. Literally ask anyone in the industry. Look at how they've ruined Nortel. See their behaviour at trade shows, taking apart competitors equipment to take pictures of their schematics. The evidence is out there, why don't you sift through? You might find a pattern.
I'm curious to know why this is all so hard for you to believe.
The Nortel accusations are completely evidence-free. Nortel collapsed because of the bursting of the tech bubble, mixed in with a fair dose of "creative accounting."
> I'm curious to know why this is all so hard for you to believe.
Because there's zero evidence for any of it. There's a general impression that's been created by American media about Huawei being a spying operation, but no evidence.
There's all the evidence in the world if you want to see it. I you don't, there is none.
The least cynical reading is that it's an expression of neo-Confucian values; those in a position of political, military or economic power have a broad belief in the importance of cooperation and "social harmony". If the NSA want to access all of Google's data, they hide an implant in a data center, put optical splitters on key fiber links or bribe a third party to provide a backdoor in a vital software dependency (PRISM and BULLRUN). If the PLA want Tencent's data or the NIS want Samsung's data they just ask for it, on the understanding that a) they're not really in a position to say no and b) cooperation with the state is a mutually beneficial quid-pro-quo.
The bottom line is that if you decide doing anything against the current US powers that be (like harassing a Senator from outside his house late at night) do not use any of the services coming from companies directly liable to the US authorities. The same goes if you’re in China or Russia, try not to use the services of companies directly liable to those countries’ governments if you want to vigorously protest the current political status-quo.
The NSA does not have a mandate to do what you’re describing, they face extensive civilian oversight and programs like their metadata collection were extensively debated in public. Are there exceptions? Yes; but they don’t have the same mandate or the same powers of control as some of these other nations, so the effect is vastly different.
Presumably people protesting against Putin or the people from Tiananmen Square weren't all asking for peaceful elections, I bet there were some protesters among them who were literally asking for Putin's or Deng Xiaoping's heads, that's what I meant with "vigorously protest". It's understandable that some people in the US would want to "vigorously protest" against people who they think are directly liable for other's people deaths, as I presume that lady thinks of the likes of Mitch Mcconnell.
As per the NSA mandate and the "civilian oversight", that's what I meant with "right at this moment". I think what you're describing was generally true until 2 or 3 years ago (yes, even after the Snowden leaks), but I'm afraid things are not the same in the current political climate.
Most democratically elected representatives don't know what the NSA is up to. The Director of National Intelligence directly lied in his public testimony when asked about NSA collection. It took a whistleblower to reveal even the basic outline of the NSA's massive surveillance powers, which the civilian population was unaware of. That whistleblower now has to live in Russia, or else he'd be rotting away in jail, or worse. The metadata program was only extensively debated after those revelations, and we civilians are still in the dark about what the NSA does. I don't trust that they've stopped their mass surveillance of Americans. A massive organization that acts with such little oversight is a danger to democracy, regardless of what it claims in public.
Er... just to clarify: Samsung was deeply inter-wined with the government before(from the 80s to ~'17), I’m not sure if NIS has actually requested Samsung’s data but I suspect Samsung could give out such data.
However most companies don’t; for example, the biggest chatting app Kakao (think as WhatsApp in the US or WeChat in China) refused to provide information; opened the fact that NIS requested info to the public; and revised the chatting system to only save the message for 3 days in the server and added a end-to-end encryption mode.
Just wanted to point out that South Korea’s situation is less like China but more like the US.
The trick to success is to expose companies to free competition in the global markets while protecting and supporting them in every other way. State aid in financing loan guarantees was the norm. Protecting home markets from competition was the norm.
Asian cultures have this idea that you learn from the masters by copying them. After you master the previous state of art you start to improve upon it. When you laugh at stealing copycats you fail to see the constant gradual improvement.
The US has painfully acquired the expertise and skills over half century. Thousands of aviators and sailors have died over decades until the current level of expertise has been reached.
Chinese have studied and copied everything. They translated USN carrier vessel flight deck manuals into Chinese and adopted it almost verbatim. Even the colors are the same. That's really smart thing to do. Trying to innovate and do your own thing starting from scratch because you have the false sense of pride and need be different would be stupid.
Marty McFly: What do you mean, Doc? All the best stuff is made in Japan
Also a lot of western cars in that periods where not so hot - the Austin Allegro for one
There are state-owned companies, and there are private companies. Competition is intense.
The links of private companies with party officials is not caused by some cultural difference that makes boundaries fuzzy but by plain old unchecked power and corruption: The Party can make or break you so you need to stay on "friendly" terms with them.
This tends to happen everywhere there is no separation of powers and rule of law. In China it is simply perhaps better organised (or perhaps not).
A corollary is that being a Party member is useful for one's career. The Party also recruits as a way of keeping control.
Probably similar for Northrup Grumman, Raytheon, Bell Helicopter, Dyncorp, Navistar, and others as well.
And in Europe, BAE and Airbus.
In East Asia, the Japanese model, that later adopted by both South Korea and China, relies on the exact opposite. The government directly involves in guiding and shaping the economy. And they are smart in doing so, with the corporations being their vehicles to implement its policy and they are ones to picking the winners. So it is not like Planned Economy like the Soviets did, instead they are trying to embrace and take advantage of the market to better advance its objectives. Instead, here in US, corporations are more sensitive and faster than the government to propose new economic initiatives, while government just sits aside as the shepherd to prevent disasters.
If you ever being able to read material from CJK countries, the government in general has a much bigger power and responsibility, and when problem happens, the societies' instinct is to push the government to act on it.
But Huawei might be still a special case among of these. It is a weird company though, which doesn't need to respond to its share holders and yet participating actively in open and competitive markets.
Not even in US this phenomenon is very strong. US protects its corporations with political and military means all the time, so I am not sure what separation you are talking about. In words there mightbbe some pretense for separation, but actions show otherwise.
To me from Western Europe the state and corporations are... comparable to families and sports clubs. Nobody would want to merge them for tons of reasons including personal freedom (here: separation of public and private spheres), effectiveness, responsiveness, avoidance of conflicts of interest etc. But coordination makes sense.
Something I have noticed about large Asian companies is that there is much less in-fighting between parts of the organization, which can make up for other disadvantages they may have. In large Western corporations it seems to be everyone against everyone in mid-level management. At the lowest level it mostly looks like inexplicable inefficiencies and stupidities.
Not true. My observations are opposite, however, I am not disapproving what you said, but I don't think there is a conclusion to make.
However, if you prove yourself as a capable strongman that doesn't take objections, then in Asian companies, under the certain circumstances/directives, I believe you can have much more dictating power over your subordinates, which can go to great extent to have them sacrifice all other aspects of their life except work.
For example, Tencent carries out a stunt to have its staff run a 24 hour 2 shifts schedule to deliver PUBG on the mobile devices, to beat its competitors on speed, which I don't think is possible in Western countries.
Freedom for the government to do what it wants with the help of corporations, and for individuals to decide to join those activities and participate freely.
The Chinese state of today is far worse than the most dystopian views the west had of Soviet during the Cold War. Then the western block tried to paint as a dark image as possible of the alleged enemy. Today it seems most try to paint as an rosy picture as possible of the Chinese state when in reality it is something right out Orwell’s nightmares.
Note. I have absolutely nothing against Chinese as individuals and people. It is the state that is scary, and to be honest; intimidating.
How are US companies supposed to compete against such state backed corporations?
The next question would then be whether anything like this can be pulled off in the US at all, which entirely lacks the sort of corporate social structures you find in Asia but also say Scandinavia or Germany.
Who owns Huawei is irrelevant, who ultimately controls Huawei is the issue, but it’s a simple answer, the Chinese Government.
I was in China on business, we were meeting the one of the largest and most successful tech companies in China. We were meeting with the Chairman/CEO and his team. Everyone was introduced except one man, everyone basically acted like the guy wasn’t in the room. He just sat and listened until he heard something he didn’t like, he quickly took over the meeting, admonished the CEO, and insisted they we do as he said. For the remainder of the meeting the CEO and his team sat head facing the conference table, it was clear they were all terrified.
Once the key parts of the meeting were decided this man got up and left, the meeting quickly ended. I tried to get my Chinese colleagues to explain what happened, but everyone just blew me off.
A couple days later we were in Taiwan, and I got the full story. The man was the party official who guided the company. The guy made sure that the Chinese government’s interests were followed.
It’s China, thinking about things like it’s the West is stupid. Everything is owned by the government.
> I was in China on business
...assume goodwill and take him at his word.
"But why the concern about Huawei and not Facebook and Google". Because they are controlled by a fascist government, a point we have largely been ignoring for decades while they weren't the 2nd largest economy?! Recently they had a guy on saying the USA intelligence/military community saw China as the biggest "strategic challenge" in the future. I'm PRETTY darn sure they mean and have said "threat to national security". He was also insinuating the the idea we couldn't coexist with their government was absurd because we "have been since 19xx". Well, were they the second largest economy in 1950-20xx? No they were not and their soft power plays are becoming much more bold.
It's almost like the NPR and the media have given up on the ideals of liberal democracy? Good grief.
The real two questions are those of profit distribution and actual power, as in the ability to effect change. The latter is always constrained by the ruling party, no matter what the incorporation rules say, and no matter what the former (distribution of profits) is. It was the case in Soviet satellite countries too, except Soviet states were also harsher on profit distribution (communism).
Employees do indeed not own the company nor shares of the company in a private ownership sense because they cannot liquidate their shares if they wish to quit the company. But it is the very same design that makes the company immune to pressure from outside investors and the financial drive to capitalization, and enables it to fully reinvest all profits back to R&D and employee dividends, which is also a major reason for its explosive growth. It is reported some early employees got paid so much from their shares that they just stopped working and went on vacation indefinitely.
If all profits of the production activities of a collective go back to its members and the continuation of growth of the collective, can you meaningfully claim the members of the collective do not own the assets of the collective and not control it?
This profit returning scheme is legally possible only by being facilitated by the Company Law of the PRC. And the way the company ownership is structured by a "trade union committee" is also legally facilitated by the Trade Union Law of the PRC. It is a fatal error for the paper to claim the company is state-owned because the controlling trade union committee of Huawei operates under the aegis of the All-China Federation of Trade Unions. In fact, all SOEs in China are governed by the State-owned Assets Supervision and Administration Commission of the State Council, and the All-China Federation of Trade Unions is not legally sanctioned nor capable to manage private companies. Then the best reading of all the contradictions would be that Ren Zhengfei managed to carve out of a space for communist collective ownership by "hacking" the existing legal system of private companies.
> Our bottom-line conclusion about what it all means is just our opinion. If readers disagree with our conception of what employee ownership means and prefer Huawei’s, that’s their opinion. As long as everyone understands what the structure is, what label one puts on it is not ultimately that important.
[1] https://thechinacollection.org/huaweis-ownership-huaweis-sta...
Here is the current Bitcoin hashrate distribution:
https://www.blockchain.com/en/pools
(20%) BTC.com - owned by Bitmain, a Chinese IC design company founded in the first quarter of 2013, which specializes in research, development and sales for custom mining chips and miners.[0]
(12%) F2Pool - a Chinese mining pool, also referred to as "Discus Fish".[1]
(11.8%) Poolin - a multi-currency mining pool. Started by the founders of BTC.com.[2]
(11.6%) Antpool - also owned by Bitmain.
That's 55.4% of the network controlled by Chinese mining companies, which I would assume have a similar structure to Huawei?
[0] https://en.bitcoin.it/wiki/Bitmain
(Of course one could also think this is a Chinese puppet account speaking :-))
The five principals (as amended there are now 7) are the key founding principals of ALL Coops
This is an old orientalist trope.
Also it's just pretty clear in general who has what interests in large American corporations. You can look at the chain of command up to the board of directors back to the shareholders.
That if the government really wanted the information, the could just send a National Security Letter using Secret Courts.
Aren’t the fates of Lavabit and MCI demonstrations of that power?
Huawei is not a state-owned enterprise, yet people are saying that operating in China, being subject to pressure from the Chinese government, makes it essentially state-owned.
Yet we know from Snowden that basically all the large American tech companies were secretly providing access to the NSA or had been pwned by the NSA. So far, there's no evidence that Huawei has spied on its customers, or that their products contain backdoors.
Note: the original claim is that companies in those countries DO NOT attempt to defy their government for similar information requests. I believe the burden of proof for that claim is on the people making that claim. I am not claiming that this has happened in either country. I’m only stating that I will not believe the original claim without seeing some evidence.
Surely you see the absurdity of that remark?
There are no substantial cases of companies in Russia and China where they have tried to fight information disclosures. Except for the high profile case of the social network in Russia... which is now under new, Kremlin friendly leadership.
China is different. It’s not an oil and gas oligarchy like Russia or the Gulf states. It is somewhat like the US was during the Second World War—somewhat capitalist in form but almost entirely geared toward the strategic goals of the country, as dictated by the government. The main exceptions are that the US had elections intermittently and that the US was in the midst of total war. China isn’t at war though—it’s just a totalitarian society.
Yet.
"This whole exercise was teaching me that Russian business culture is closer to that of a prison yard than anything else. In prison, all you have is your reputation. Your position is hard-earned and it is not relinquished easily. When someone is crossing the yard coming for you, you cannot stand idly by. You have to kill him before he kills you. If you don’t, and if you manage to survive the attack, you’ll be deemed weak"
Without knowing the details, this sounds more efficient and potentially fairer for the society. It allows for information and innovation to flow in the industry, rather than a single company making absurd amount of money only because they can keep it secret.
It doesn't mean wealth is automatically better distributed, but it could help.
This is particularly true of a playing field as large and as cutthroat as China, where at any given time there are thousands of competitors jostling for dominance of even the most minuscule of niches.
Bill Barr has had the ability to declassify for 80 days, nothing yet. I expect nothing but covering up for the DoJ and Wray's FBI.
This seems to be the opposite of the US system where, once you amass that amount of wealth, power, and influence, you get to control the major political parties.
Any entity that wields power, is a potential threat to a monopoly power holder (the state), and as a result, has to be collaborated with, or fought against.
Well Huawei is pretty specific about the internal governance procedures of the trade union committee, who the committee members or other trade union leaders are, and how they are selected. https://imgur.com/a/mEFkgna
It obviously doesn't mean that anyone should believe them. But for a journal piece to say "We know nothing" rather than "There are no means of independently verifying Huawei's claim" make it hard to take them seriously scientifically.
Someone could look into example of Boeing and the FAA. The more we learn about 737-Max and 787 Dreamliner certification the more it's obvious that Boeing is running the FAA.
Another example is the FDA. Good example here is Monsanto. While it was under US ownership everything was fine. Once it got sold to Bayer, suddenly stuff is carcinogenic. What I want to say is, that everybody knew since more than a decade before the transaction, that the stuff is carcinogenic. This seems to me like the FAA was protecting Monsanto before it was sold off.
The FDA doesn't do that for pesticides, it just makes sure quantities in foods are within EPA limits. https://www.fda.gov/food/pesticides/questions-and-answers-gl...
The EPA is the one who would make the determination you suggest, but in fact they still say the opposite: https://www.usnews.com/news/national-news/articles/2019-04-3...
It's trial juries in the US that have been giving Bayer problems with regard to RoundUp, not regulatory agencies. Which doesn't fit with your government conspiracy theory.
https://www.nytimes.com/2019/04/25/technology/who-owns-huawe...
* Mark Zuckerberg owns ~25% of Facebook, because he owns ~25% of the outstanding shares.
* Mark Zuckerberg owns ~50% of Facebook, because he has a lot of special shares that end up giving him ~50% of the shareholder votes.
* Mark Zuckerberg owns Facebook in totality, because he runs the company and there’s no mechanism for anyone to force him out.
In this particular case, the authors and Huawei seem to agree about what’s on paper. The authors just don’t think that the structure Huawei calls “worker ownership” allows workers to actually decide what the company will do.
Honestly. I find it hard to see the big problem here. Huawei is run by Ren Zhengfei, who is also the public face of the company, and besides running its daily operations also formally has veto rights.
Then there is a share scheme running through a union where the shareholders have no practical say but get a share of the company dividends. These shares are good enough for employees to take loans in and the issuance of shares has been a way for Huawei to finance itself.
So in terms of control, the ownership of the company doesn't mean a lot in any case.
Never heard of it, never thought about it, not sure why proving/disproving this is in the author's interest.
The main curiosity regarding what the structure of Huawei actually is would be interesting, edge of my seat for that one. But who cares about the employees, who would ever believe that it would be anything other than corporate speak? I would basically assume that because a shareholder who happens to be employed there at some point in time, that the company would make that assertion just to make people feel good. The profit sharing scheme the abstract suggests is good enough to align incentives and make the non-capital class feel like they "own" something. It is so improbable that a labor class is also a capital class that I would be more surprised to see a paper showing how it was true, and it would be from Harvard Business School and not randomly uploaded to SSRN.
It is in Huawei's interest to not be labelled as a state-owned or state-controlled actor. The perception of being controlled by the Chinese state is precisely why many western countries are leaning away from purchasing Huawei networking equipment for their up and coming 5G networks, and also (at least in the case of the US) advising against, and then banning, consumer electronics made by Huawei. Huawei has been trying to convince the public that it is in fact employee owned and therefore not controlled by the Chinese state by touting its "employee virtual ownership program", and the purpose of this paper appears to be to dispel that notion.
Chinese state owns some of most Chinese companies. Some passive through the central bank open market operations, some more direct and controlling.
So it is almost like trying to prove a negative, with Chinese companies, but if we really want to dive deeper on this particular issuance, the opaque trade union governance is a nice tip of the iceberg.
I just think it is such a weird assertion to start with.
I do not see how Huawei isn’t any more a cooperative than how Iran or the US has popular representation.
Just because there is several layers of indirection does not prevent representation, it also requires the alignment of the represented’s desired outcomes with the representation’s actual accomplishments.
China's extreme reaction (to the lawful action) is one that could be considered appropriate if Ms. Wanzhou wasn't an executive at a private corporation but a high ranking member of the government. China has responded as though it was an affront to the government.
> We do not know who the committee members or other trade union leaders are, or how they are selected.
> Given the public nature of trade unions in China, if the ownership stake of the trade union committee is genuine, and if the trade union and its committee function as trade unions generally function in China, then Huawei may be deemed effectively state-owned.
There are lots of unknowns and many if's. It is far-fetched at best that Huawei is state-owned.
Isn't it the same in here in the US? The president said "hey companies, you cannot trade with Huawei" and every company has to follow.
My point is every government has some degree of influence on their companies. How much is another question. However in my opinion Huawei cannot be as innovative as they are with as much influence from their government as people here often suggest.
In the US you can fight the government and even side with the other party and try to get the president to lose their job.
Most know it's more profitable to ride a wave rather than to fight it.
I had to search that acronym. HTH
Plus a trade union committee implies a government structure.
Tencent, Baidu, Alibaba, Ctrip, JD.com and dozens of other major Chinese Internet companies did not begin as state owned enterprises.
They were all born during the prime years of Deng's philosophy holding sway over how the Chinese Government implemented economic policy. At one point Yahoo and Softbank owned about 80% of Alibaba as an example. The state had very little applied control over the company until the Xi era. China's system today is not the same as China's system in 1999. There was far more freedom in the system of 20 years ago, including in regards to corporate independence and speech online.
Or do they?
It really is a private startup story like those in the Silicon Valley.
How come there are so many Chinese startup success stories then?
Those weren't "major companies" when they began...
[1] https://www.marketscreener.com/ALIBABA-GROUP-HOLDING-1791667...
From a continental European perspective I'd contest that. Quite a few of today's multinationals here began as either wholly or partly state owned and/or today have still significant state ownership - especially in infrastructure/utility/telecommunications, but also in "strategic" industries. This includes telcos like Deutsche Telekom (with its daughter T-Mobile), former state mail companies like DHL, Airbus (and its numerous predecessors), most of the state airlines (Lufthansa, Air France-KLM, SAS etc.), and others like Volkswagen, Renault, Peugeot/PSA, STMicro just to name a few.
That isn’t true at all. A lot of the companies started after the late 80s were never stare owner at all.