Comment by jdietrich | Hacker News Reader

Comment by jdietrich | Hacker News Reader

Parent Full thread

>Why should the US allow Chinese companies to operate in the US?

The US gains very substantial economic benefits from being an attractive place for international companies to do business. Foreign investors know that when they invest in America, they're getting a stable regulatory environment and a reasonably trustworthy civil legal system. If America decides to undermine that trust for short-term gain, there will be a substantial long-term cost.

You might believe that hostile trade policies prevent American companies from competing in the Chinese market, but that's starkly contradicted by the number of American companies for whom China is a key market. Apple earn $11bn a year in China. Wal-Mart have thousands of stores there. Yum! Brands (KFC, Pizza Hut and Taco Bell) have 40% of the Chinese fast food market and make more revenue there than anywhere else. Starbucks have 70% of the Chinese coffee market. The shelves of Chinese convenience stores are groaning with American-owned brands.

An all-out trade war with China might be appealing, but be under no illusions that it'll be all upside for America. If China want to put the hurt on America, they have more levers to pull and more staying power. It's definitely not a fight you want to lose, but it might not even be a fight worth winning.

China aren't thinking about next quarter or next year, they're thinking about the next generation. Where does the US see itself in 2050?

I highly doubt China has more levers then the US when it comes to a trade war.

China can't feed itself past subsistence level without imports. https://www.bloomberg.com/graphics/2017-feeding-china/

China runs on oil just like every other modern economy, and they have pitiful amounts locally. They are the largest importer in the world and they absolutely need it to keep flowing. https://www.forbes.com/sites/judeclemente/2019/10/17/china-i...

The US can feed itself domestically, and we can supply our own energy domestically. All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly. Note - I'm not even saying we have to attack them, we just stop responding to any requests for help from them and let the world know.

China relies on the US enforced world order to survive in its current form. The US relies on China for convenience, not for survival.

Would it be wise to do what I just said? I don't know, and I'm not advocating for it, I just find it funny when people say China would so obviously win a trade war when they are definitely in the worse position at a fundamental level.

>China can't feed itself... China runs on oil

That's only a problem if the rest of the world sides with the US in a US-China trade dispute. There are plenty of net exporters of oil and food who would be very happy to sell to China and would be rather pleased to see the US get a bloody nose.

>All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly.

China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability.

The US relies on China for convenience, not for survival.

US hospitals would rapidly degrade to third-world conditions without imports of Chinese-made supplies and materials. COVID-19 has revealed the fragility of global supply chains and the position of China as a manufacturing superpower. If you need a sufficiently large quantity of pretty much anything made, you don't have many options outside of China - doubly so if you need it in a hurry. If China decides to tighten the noose on American consumers, you're going to immediately see severe shortages of even the most basic goods.

A total trade war between China and the US would of course have a catastrophic impact on US export revenues because of American reliance on outsourcing - US sanctions on Huawei have had a significant but manageable impact on their smartphone business, but Chinese sanctions on Apple would be catastrophic.

> China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability.

Lmao. The US Navy has roughly 3x the strength of all the other navies in the world combined. If the US and China went to war, the US would control the seas in about a month.

America has a lot of very expensive but not necessarily useful ships (see the Zumwalt-class clusterfudge). China has an inexpensive anti-ship ballistic missile system that can sink anything in the Pacific. America's Aegis system might stop some ASBMs some of the time with a favourable wind.

The prediction that "of course America will win this war easily, look at all the kit we have" does not have a good track record.

https://www.washingtontimes.com/news/2010/dec/27/china-deplo...

There's a few things here.

First and foremost: Any argument we make is based on unclassified publicly known details related to the technological capabilities of both countries. This is an uninformed and untenable position to be making strong arguments from.

Two: There's not a lot of evidence the ASBMs can actually hit moving targets. There are a lot of impressive claims on the ASBM and ASCM front, but we have seen impressive claims from Russia and China on prior weapons that have not panned out in reality. Everyone postures about having a better hand than they actually do.

Tree: There's a lot of strategies we can employ besides Aegis. The US Navy has countered similar threats before, and can likely do so again.

This Congressional Research Service report on Chinese naval modernization is an interesting read in general, but has an appendix specifically discussing ASBMs: https://www.everycrsreport.com/files/20191220_RL33153_d765d5...

I learned something recently about sea mines. and land based guided balistic missiles that render navy carriers and destroyers useless.

The us already controls the seas

>China has a large, modern and highly capable navy.

China's navy CANNOT project power into the strait of Hormuz to secure their oil supply. Any one of the regional middle eastern powers could cut off their supply if they wanted to. They can defend their own shores, that's about it.

>US hospitals would rapidly degrade to third-world conditions without imports of Chinese-made supplies and materials.

Yes, for a period of a year or two until manufacturing can be brought up elsewhere. In the meantime the CCP would likely have fallen while dealing with mass riots due to a cratered economy and forced relocation of hundreds of millions from the cities back to rural areas so they could feed themselves without mass imports.

Look, it would absolutely be a terrible time to live through in the US, and whatever party was in charge during this period of time would likely lose power in the next election. But for the CCP, it would be game over, and I think they know it.

>China's navy CANNOT project power into the strait of Hormuz to secure their oil supply. Any one of the regional middle eastern powers could cut off their supply if they wanted to.

A quarter of the world's oil passes through the Strait of Hormuz. Three quarters does not. Oil prices are at record lows and many oil-dependent economies are desperate to sell their production. China has made a lot of friends in parts of the world where America has made a lot of enemies.

China has oil pipelines supplying imports from Kazakhstan and Eastern Siberia, in addition to two natural gas import pipelines. China is the 4th largest oil producer and has an exceptionally large strategic reserve of around 400 million barrels.

China does not want a conflict with the US. Any conflict would be massively detrimental to both parties, but there are many reasons to believe that the US is socially and politically under-prepared for coordinated action in the national interest. Is this really a fight you want to pick? What does "winning" even look like?

> Is this really a fight you want to pick? What does "winning" even look like?

If this kind of analysis mattered to people, the US might be doing something differently in the Middle East.

I remember reading that the goal of the Trans-Pacific Partnership was to make sure Southeast Asian countries continued to weight American desires more heavily than Chinese desires in their own policies. Apparently there's a substantial section of the US state that views it as a priority to make sure that e.g. Vietnam doesn't "flip" over to China.

But that's completely insane. Vietnam definitely will flip to China, no matter what. A Vietnam that looked more to the US than to China would make as much sense as a Canada that looked more to China than to the US.

or like Japan or Korea.

> China's navy CANNOT project power into the strait of Hormuz to secure their oil supply. Any one of the regional middle eastern powers could cut off their supply if they wanted to.

Iran would probably have a thing or two to say about that. And I don't think any of the Arab powers are internally stable or capable enough to take on Iran, yet alone China.

Iraq did.

Take on would most likely a persistent guerilla warfare. It is cheaper than diect confrontation, and possible denial of plausibility. Without a strong power projection, distant gueriella warfare with minimal combatants can wreck havoc as what USSR and USA found out many decades ago in Agfhan and Vietnam.

Don't forget coal [0]:

"Coal remains the foundation of the Chinese energy system, covering close to 70 percent of the country's primary energy needs and representing 80 percent of the fuel used in electricity generation"

[0]: https://en.wikipedia.org/wiki/Energy_policy_of_China

> The US can feed itself domestically

...for about 20 more years, if soil quality and climate predictions are accurate.

Out of curiosity, do you have links to more information about this?

China can feed itself. It doesn't have to be beyond subsistence level.

China runs like every other country on oil, but a large part of that demand for oil is to produce for the rest of the world. You need to calculate the actual domestic demand for oil and related products rather than total demand. The US can supply its energy domestically, but what if the US have to reopen the factories once closed to make other products? Will the oil be fluent? Oil isn't just the thing you put in your car. You'd be surprised how many of our modern products need oil (plastic, fabric etc).

Of course, those statements are made under the same assumption that there are only China and US in the world, or that the whole world go in to isolationist status. I'd rather not make any argument here, but to suggest somehow China's continued survival depended upon the global market while the US's doesn't is nothing more than an illusion.

This action is unfortunately part of the normal progression of disruptive innovation. Upstart China has adopted a disruptive strategy of engaging with world markets while using heavy-handed regulation to avoid being controlled by those markets. Incumbent USG is now copying China's strategy, claiming that doing so is necessary to keep the US competitive. However, the US is a world leader through free markets and open collaboration, deferring control to markets even to the detriment of our own citizens. What copying China's strategy will actually do is cannibalize the US's existing economic structure, causing extreme damage to the US.

Bang on the money, except for one thing - the USG is copying China's tactics, with no real understanding of the strategy.

Reply on news.ycombinator.com