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Comment by Robotbeat | Hacker News Reader

Almost any argument attempting to invoke intrinsic intelligence (as an explanation for some geopolitical phenomenon) is horsehocky. But even if you buy that, the West (particularly the Us) can game that by accepting “High skilled” immigrants from the entire world rather than just relying on just a fraction of the human population. A distillation of ambitious people from every nation on Earth.

I personally doubt very much how genetically hereditary this is. So you have to maintain a high number of first or second generation immigrants to keep the effect going.

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I think it'd be horsehockey if I were claiming that the Chinese or white people or Americans or whoever is intrinsically more intelligent or "culturally" hard-working or whatever. That's bullshit. I can understand the gut reaction to any mention of IQ since it is a common trope among racists on the internet.

But my claim is not that: it is about the pretty clear concentration of inherited wealth in the US, compared to the intensive testing system used in China.

Your immigration solution would fix the intelligence of our workforce (skeptical that's a huge problem to start with), but do nothing to resolve the distributional problems in our model.

If your argument is that we are approaching an aristocratic, low-churn society with a bunch of favored failsons at the top, then that would make more sense than trying to frame it in terms of Intrinsic intelligence. But I don’t think your comparison is accurate. The Chinese Party leadership and bureaucratic apparatus is plenty nepotistic while America’s more private-market-oriented economy is now dominated by (1st or 2nd generation) immigrant-founded or run companies like Google, Microsoft, Apple, and Tesla. Read: https://www.scmp.com/news/china/article/1236343/son-also-ris...

> we are approaching an aristocratic, low-churn society with a bunch of favored failsons at the top, then that would make more sense than trying to frame it in terms of Intrinsic intelligence.

Uh, I'm not sure exactly what you're disagreeing with. I think intelligence is a thing, I think tests can probably reflect it at least a bit, and I think the fact that wealth is not really correlated with it means that there are probably a lot of dummies making capital allocation decisions.

> immigrant-founded or run companies like Google, Microsoft, Apple, and Tesla

I'm talking about ownership and capital allocation, so the management of any particular firm is somewhat irrelevant. The immigrant founders of Google, for instance, only hold 14% stake in Alphabet. Much of the ownership is by these "favored failsons" as you put it, even if they aren't the managers. That's not even getting into the fact that the vast-majority of America's economy is not these popular-to-talk-about tech companies or that Google's have to run-the-gambit of getting green-lighted by "failsons" just to have a chance of being funded.

We could have a whole separate conversation about the effectiveness of China's bureaucracy, but all I'll say is that - even if they have the same problems, ours have had more time to solidify, and China's wealth Gini coefficient is smaller than ours, so the problems would be less magnified.

> China's wealth Gini coefficient is smaller than ours, so the problems would be less magnified.

The World Bank's data is a bit spotty, but it looks like China's Gini is roughly similar to the US's at around 40 whereas other economic powers like Japan, Germany, South Korea and France are bunched closer to 30.

https://data.worldbank.org/indicator/SI.POV.GINI?locations=C...

If your theory of is based on China having less wealth inequality than the US, you really should also look at countries with much less wealth inequality than either.

> The World Bank's data is a bit spotty, but it looks like China's Gini is roughly similar to the US's at around 40 whereas other economic powers like Japan, Germany, South Korea and France are bunched closer to 30.

This is a common sleight-of-hand - you're giving me income Gini coefficient and describing it as if it is wealth gini coefficient. Check out the wealth gini here [0] to see that Germany and the US are much higher and China is more comparable with France.

> If your theory of is based on China having less wealth inequality than the US, you really should also look at countries with much less wealth inequality than either.

Also to be clear, my "theory" is not based on China having less wealth inequality. My "theory" is that the people making large capital allocation decisions in China are typically smarter.

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

> My "theory" is that the people making large capital allocation decisions in China are typically smarter.

In that case the wealth Gini should be high so that the smart people get to control all the money.

In Chinese government, often the smart people get to control capital allocation without owning all of the money.

Also, that's not necessarily true - I think it is better to have investment controlled by a diversified group of smart people, which would mean not a super-duper high gini coeff.

American reliance on high-skill immigrants to build value-generating businesses is reflective of long-term weaknesses, both due to increasing hostility to immigration, and due to domestic high-skill talent being pulled into zero-sum economic sectors that extract economic rents but create no value. Unless the US is prepared to address these weaknesses, they will gradually erode US standing vs. China.

China's parliament has ~100 billionaires, and the concentration of wealth is even more extreme than that when you count those with a net worth exceeding, say, $100 million instead.

The difference between those at the top in China and those at the top in the US is not one of wealth concentration or inheritance or intelligence. The difference is access to raw power, national unity, and a massive foundational population. The Chinese government operates very differently from the US government and can move initiatives forward dramatically faster and at lower cost by essentially bulldozing through what would be vast legal and regulatory webs in the US involving dozens or hundreds of independent parties with various ownership stakes or legal claims that have to be balanced and negotiated against.

Of course, there is the (obvious) point that ~100 billionaires in government is not contradictory with capital allocations being made by smart people. How many of those billionaires inherited their wealth?

> China's parliament has ~100 billionaires, and the concentration of wealth is even more extreme than that when you count those with a net worth exceeding, say, $100 million instead.

I mean, just looking at the facts - independent observers put US wealth concentration at higher levels than China, look at the wealth gini coefficient.

> The difference is access to raw power, national unity, and a massive foundational population.

This combination has existed elsewhere. The intensive testing/promotion scheme used in the CCP has been a little less common. The difference between the US and China is that we put this "raw power" in the hands of private enterprise and management, whereas in China they sequester a lot of that talent into the party and sometimes loan it out to private industry.

It's just not clear to me what point you're trying to make. Maybe the US has more wealth concentration at the top than China, but it's clear that both countries experience this problem/symptom to an extraordinary degree. It's also clear there are tons of self-made multimillionaires and billionaires in the US, including probably a surprising number right on this very forum (well, maybe not billionaires so much). You're trying to make it seem as if the US is dramatically more unequal than China and that every wealthy or powerful person in the US inherited everything but this is far from obvious and probably false.

> The difference between the US and China is that we put this "raw power" in the hands of private enterprise and management, whereas in China they sequester a lot of that talent into the party and sometimes loan it out to private industry.

On this point I do completely agree with you.

The point I'm making is pretty clear. Obviously this analysis is entirely comparative, since we're trying to diagnose why China might diverge compared to other growth models.

China has comparatively less wealth concentration, and a comparatively much higher proportion of Chinese billionaires and multimillionaires are self-made compared to the US. Keep in mind, there weren't really any billionaires in China before 1980 for them to inherit the money from.

Your point is not at all clear to me, sorry. I think the differences you're pointing out are small at best, and while they may not have had a vast aristocratic billionaire or centimillionaire class in the past, they definitely do today.

China's system acknowledge power and classes.

Billinares have enourmous power, then putting them into the power system, is a appropriate recognition; and ensures appropriate control and management as well.

While in US, the enourmous power of billinares are masked behind an entagled web of legal and political constructs, which are so complicated that the ones involved probably dont have a clue how much power they actually have. Today they can be enoumously powerful, the next day they are suddenly under constant barrage from all sides. Like FB Google and Twitter were chanted as the beacon of free world's inevitable domination in world in the grassroot's revolutions in middle east (Arab's spring); now they were blamed for almost every instances of domestic plitical failures.

A better approach might be subject these powers into the government system, and manage and use them as tools. Instead of pretending that a free-rein systems can regulate themselves, which ends up with a swamp of complications and complexity that no one is able to remotely influence the thing with a coherent vision and strategy.

I'll step on the landmine.

> I think it'd be horsehockey if I were claiming that the Chinese or white people or Americans or whoever is intrinsically more intelligent or "culturally" hard-working or whatever. That's bullshit.

Why would that be horsehockey? Why would you expect people in different countries and cultures to be equally intelligent or hard-working? That would be surprising! So clearly there will be difference of some kind, and it might be small on the average, or it might not be. I'll follow the data where it leads.

I don't accept that the topic is forbidden from rational investigation and discussion. Or that everyone is somehow magically equal and life is fair - that's the real bullshit.

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