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Comment by killtimeatwork | Hacker News Reader

That's where China was smart I guess. They didn't sign any treaty which forced them into free trade or IP protection, but instead slowly allowed their industries to build up via IP theft and strong protectionism. Now they have giant companies on par with the West's. Whereas everyone who joined the EU in the decade of 2000 (and the Washington Consensus before that in the nineties) is now a pawn of the Western capital with no clear path of escaping the trap of mediocrity.

So far, the standard of living in post-Soviet EU countries is still higher than in China, but that's because of the much better starting point and also because it's just hard to provide wealth for over a billion people in a modern, heavily automated economy. However, even with their gargantuan population size, I see China potentially overtaking Poland or Czech Republic in terms of quality of living in the next 50-100 years.

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I really think China is making a huge mistake actually. See how TSMC (Taiwan) and Samsung are free to buy ASMLs EUV machines, while China is blocked. Part of that is due to their rampant IP theft. Why sell machines to China if they're just going to copy them?

China also messed up big time by enforcing their 1 child policy, and taking so long to open up and industrialize. They're far behind economically compared to where other countries were with their demographic. Now they're on the verge of the biggest wave of senior citizens reaching retirement the world has ever seen, with crumbling infrastructure and housing, relatively low GDP/capita and no clear path to manufacturing/export of truly high value goods and services. They're screwed.

China really wants to get out of low-value manufacturing, and in some ways they're encouraging pushing that out to south-east asia and africa. But at the same time they don't have the positive image and reputation needed to be a big exporter of high-value goods. Who is going to trust Chinese companies with things like 5G infrastructure and CPS, when they're all basically an extension of the CCP when it comes to security? Who wants to live and work in China now, when you have no real justice for foreign citizens and the CCP can arrest you at a whim? If anything even close to Shenzhen is replicated elsewhere in the world, I think companies and individuals will gladly develop their products elsewhere. Will a giant Chinese company ever gain the reputation of Samsung or Sony? DJI I guess? But that's a bit niche.

Poland is growing healthily last I checked. The proof is in immigration numbers in other European countries. It seems to be reversing. In Norway there's a clear downward trend in immigration from Poland.

> See how TSMC (Taiwan) and Samsung are free to buy ASMLs EUV machines, while China is blocked. Part of that is due to their rampant IP theft. Why sell machines to China if they're just going to copy them?

ASML's machines aren't something you can just copy by buying one of them. (You'd do better by hiring ex-ASML engineers to teach you how to do it.) And ASML would've sold their EUV equipment (just as they continue to sell previous-generation machines) if their export license had been extended by the Dutch government, but the US applied pressure to make sure that didn't happen.

You say China took too long to open up and industrialize. Well, they are open to buy from ASML and industrialize with their help, but others are closing that door...

I think people who think China can be contained are being naive. As an academic, I am extremely impressed with the improvement in scientific publications in CS out of China of late. In 10 years, they are now killing it on a consistent basis (personal anecdote: a paper from Tsinghua or Shanghai Jiao Tong on average is as good as one from Berkeley, Stanford or MIT). I have a feeling it has to do with the reality that Chinese nationals (or people with some ethnic/language connection) are an integral part of cutting edge science globally. It is extremely do-able to entice these individuals back. Western countries have severely under invested in research .. even back when I got my PhD (like a decade ago), my job packages were far superior in Asia (not just China) than in the West.

I think in 5G, some top level planners in the West have realized the error of their ways, and are investing heavily in basic research. I think it is too late.

> (personal anecdote: a paper from Tsinghua or Shanghai Jiao Tong on average is as good as one from Berkeley, Stanford or MIT)

Wait until Berkeley Stanford and MIT get better network security! [0][1][2]

[0] https://www.nytimes.com/2019/12/31/us/chinese-scientist-canc...

[1] https://www.latimes.com/california/story/2020-06-11/chinese-...

[2] https://www.cbc.ca/news/canada/manitoba/chinese-researcher-e...

Those links provided doesn’t seem to have anything to do with Berkeley, Stanford nor MIT?

Also, only one of them has anything to do with theft. The other two are simply unrelated news stories about people with links to China - one was a US researcher who may have lied to get a visa, the other simply a "policy breach".

To cite them here is firstly to lie, as they aren't relevant, but secondly to show some pretty xenophobic tendencies, equating any news story connected to anyone Chinese as being proof of some other anti-Chinese theory.

Pretty disgusting.

The IP theft is indeed quite disgusting.

[0] https://blogs.cisco.com/news/huawei-and-ciscos-source-code-c...

[1] https://www.bloomberg.com/news/features/2020-07-01/did-china...

[2] https://globalnews.ca/news/7275588/inside-the-chinese-milita...

[3] https://www.justice.gov/opa/pr/former-raytheon-engineer-sent...

[4] https://www.nydailynews.com/news/national/snowden-chinese-ha...

[5] https://www.theverge.com/2019/7/10/20689468/tesla-autopilot-...

[6] https://www.thedetroitbureau.com/2019/03/tesla-sues-former-e...

>> See how TSMC (Taiwan) and Samsung are free to buy ASMLs EUV machines, while China is blocked. Part of that is due to their rampant IP theft. Why sell machines to China if they're just going to copy them?

> You say China took too long to open up and industrialize. Well, they are open to buy from ASML and industrialize with their help, but others are closing that door...

There's also the elephant in the room: China is controlled by the Communist party, which holds values that are antithetical to those of many of its trading partners (https://www.nytimes.com/2013/08/20/world/asia/chinas-new-lea...). Neither Taiwan nor South Korea have that kind of incompatibility. It was kind of naive and arrogant for Western trade policy to focus on stuff like IP theft and market access while ignoring that elephant.

Israel seems to be selling chips to Chinese companies and weapons to Azerbaidjan unhindered by US pressure though.

https://www.nbcnews.com/think/opinion/cheap-drones-china-tur...

> I really think China is making a huge mistake actually. See how TSMC (Taiwan) and Samsung are free to buy ASMLs EUV machines, while China is blocked. Part of that is due to their rampant IP theft. Why sell machines to China if they're just going to copy them?

Because China can waggle a huge target market to tempt people into repeating well documented mistakes

I think it's healthy to have a diverse set of mid and upper market companies. Chinese companies will ultimately buy their way into up market businesses. One antidote that I can readily think of is the acquisition of the street wear company Bape buy a the Chinese/Hong Kong manufacturer I.T Group. Forbes magazine is another company that was acquired by a Chinese company.

Furthermore, Hong Kong has some international appeal and most people think of it as a nation separate from China. In reality, companies from China incorporate in HK to escape the aurora of being a Chinese compnay

Hong Kong companies have better brand reputations than Chinese companies but gradually there are more Chinese brands gaining better reputations.

I would expect this to continue. In fact, there are probably a few brands that are Chinese that you don’t realize are Chinese.

I’m not sure the whole swallowing of Hong Kong (and ignoring the two systems one country thing decades before it was set to lapse) is helping with brand reputation.

Who is going to trust Chinese companies with things like 5G infrastructure and CPS, when they're all basically an extension of the CCP when it comes to security?

They're going to try to compete on price and quality. If customers think that the Xiaomi phone is good and cheap, the governments will have a hard time banning it. Customers don't really care about turning over huge amounts of information to Tiktok as well as to Facebook. That puts the western governments in a bind, to either ban wholesale or piecemeal, and it looks bad for them either way.

That's not a guaranteed win for China. It's hard to compete on both price and quality, and they're going to have to work hard to win a reputation for the latter. It's possible: both Japan and South Korea have done it. But they did so with a friendly US, not a hostile one.

They have the advantage of an enormous internal market, but it's not a wealthy one. They're going to look to Africa, which is also not wealthy, but there is money there, with less focus on privacy and more on price. Perhaps India and Latin America as well.

I think it's also fair to note that "Africa" is a huge place with huge income distributions. I can see South Africa and North Africa aligning more with the West, and East Africa going more to China.

I doubt it. There's already lots of african resentment towards china's particular brand of economic exploitation. There have been murders already.

> Part of that is due to their rampant IP theft

Weren’t South Korea, Taiwan, and even Japan once known for their rampant IP theft?

The US was to and not that long ago.

>Japan once known for their rampant IP theft?

Yes they stole even IBM Mainframe OS's repeatedly....and sold it.

IP theft allowed China to acquire much needed technical know-how and to build up their manufacturing industry.

Uuh have you not heard of xiaomi or oneplus? They're already creating high value goods.

DJI drones is another example

Indeed. My 4 year old Oneplus phone taught me that China can make a phone just as good as anyone else. It's a quality product and was at a great price.

With that said, my next phone will be an iPhone. I am trying to de-china whenever I can when it comes to buying stuff.

> With that said, my next phone will be an iPhone. I am trying to de-china whenever I can when it comes to buying stuff.

I have bad news for you, friend.

> With that said, my next phone will be an iPhone. I am trying to de-china whenever I can when it comes to buying stuff.

Isn't Apple extremely well known for it's production lines being in China?

Yes but apple users casually happen to ignore that fact when it comes up

well, it's still better than buying stuff from Chinese company if you are trying to "de-chinaze". Also, I don't think you have any other option. ah, aren't samsung phones made in South Korea? so you do have alternatives.

The 1 child policy is probably a big issue but IP theft is partly how the US industrialized. The textile mills of the North that kicked off industrialization in the US was based off of IP stolen from Britain. In fact, many of the practices that the Chinese are using were also used by the Americans: smuggling plans, hiring key employees, tariffs, etc.

https://www.realclearmarkets.com/articles/2018/07/30/ip_thef...!

http://web.mit.edu/heikki/www/antebellum_tariff_draft1.pdf

Even domestically, the reason Hollywood is the center of the film industry is because California was too far from the East coast for patents on moving picture cameras to be effectively enforced.

I thought it has more to do with weather, particularly ~300 sunny days per year.

It was a bit of both. I think I first read about this in Lessig's Free Culture [1], but even Wikipedia mentions some of this: somewhat ironically because of the MPAA's current heavy-handed tactics, Hollywood was founded on piracy and patents infringement. Some moviemakers moved West to explore new territories and climates (Wikipedia mentions D.W. Griffith) but others soon followed suit in order to avoid Edison's patents. It can be argued that Hollywood was made possible by people who broke the law [2]

So Hollywood and the MPAA, who so aggressively pursue what they deem "IP infringement", have more than one skeleton in their closets.

Bear this in mind whenever someone tells you -- as often witnessed here on HN -- "but without copyright there will be no writers" or "art isn't possible without IP laws".

----

[1] https://en.wikipedia.org/wiki/Free_Culture_(book)

[2] https://en.wikipedia.org/wiki/Cinema_of_the_United_States#Ri...

> "without copyright there will be no writers"

Just recently had a bit of a good laugh about this. I decided to read Caesar's notes on Gallic wars, and downloaded some random .fb2

It turned out to be a preview fragment, which ended with a stern warning that it is illegal to break copyright laws and that this book can be legally purchased via provided link. I'm sure Gaius Julius is very happy with how these guys protect his interests.

That's ostensibly for the translator (of course it's more for the publisher). You can get (typically Edwardian-era or earlier) public domain translations, or the original Latin, for free in lots of places.

I read it in russian, and I specially checked that russian translator died almost a hundred years ago.

Ah, yes that was rather Anglocentric of me, apologies. And that's a lousy situation--any idea why that's the case?

They have a public domain English translation free at gutenberg.org

"but without copyright there will be no writers"

Well, without copyright, writers would find it hard to live off their work, but contemporary copyright has outgrown its usefulness and it wasn't writers who pushed for extensions.

Let us get back to the original 14+14 model, but how, against a determined resistance of entrenched interests?

Isn't the underlying problem here the idea of Intellectual Property doesn't really correspond to real property? If I have an ax I use to provide lumber to our town and you steal it physically from me, that's theft. But if you see my ax, understand how it works, and make your own to also cut lumber, is that really theft? Or is it net beneficial to the town, as now people have more cut lumber to choose from and perhaps lower prices? However, if I lobby to get an IP law, how does that serve the community? It only protects me from competition.

The theory is that nobody will invest in e.g. researching how to build a complicated lumber cutting machine if they don't have protections against their competitor copying the results.

Let's say this research costs 1 million dollars, and the company bankrolls this via a loan. They build it and are successful, and begin paying it off.

Their competitor copies their idea, and exploits the fact that they have more capital and less debt to buy up more of the market, and end up the winner.

So, under a zero protection scheme it is optimal to wait until your competitor invests in research, and then just steal it. Which is what happens on a geopolitical level where there is no feasible enforcement possible.

Is it such a bad thing? The United States did it in order to industrialize and I would say that's a good thing.

Certainly depends on your utility function and the degree to which the ends justify the means. Is it good to steal from an apothecary to treat your ill wife? etc.

The underlying issue with Pareto optimal scenarios like this is that we end up trapped in a local minima.

I think in a particular case it's important to look at the context. For this, it likely depends on the scale, so in small town Georgiaville it would prevent innovation, but across the world scope its better* for ideas to be free.

*given most mainstream progressive utility functions and non-zero-sum philosophies

One might argue that the us did it in a time where markets weren't really developed on a global scale like they are today, so that comparison is only valid to a certain degree.

Some protection is good but there is this sort of hedonic drive to keep extending protection even though only a certain amount is needed to keep industries alive. At that point it is purely a wealth transfer.

It depends on how much the invention cost in the first place.

Some inventions are pretty expensive, like mRNA vaccines. If there is no way to profit from them, no one will spend crazy money on the research.

(Notably, mRNA was originally researched by the academic sector, but it did not recognize the importance of the topic and Katalin Karikó had to move to the private sector to finish her work.)

You seem a bit misinformed. ASML CEO has repeatedly showed extreme desire to sell in china (it already comprises the fastest growing DUV market)[1]. It's the american pressure, indirectly or directly exerted which is causing issues. If it were upto ASML SMIC would already be establishing it's EUV fabs.

[1] https://www.caixinglobal.com/2020-10-16/dutch-tech-giant-asm...

fact remains, that there are dificlties.

Are you a troll? The difficulty is clearly not coming from chinese IP theft but american fear.

> See how TSMC (Taiwan) and Samsung are free to buy ASMLs EUV machines, while China is blocked.

That's because of geopolitics: These countries are small enough that they cannot be a threat to the US. In fact they are dependent on the US.

China, on the other hand, is a strategic adversary irrespective of their IP laws (and enforcement of those laws) or even of their political regime.

>"...Part of that is due to their rampant IP theft..."

IP is artificial construct supported and ultimately enforced by governments when it suits their purpose. For developing countries this IP just locks them forever into servitude as they can not afford to pay for IP. Never mind that. Even if they invent something themselves they'd still be breaking some patent. Personally I completely support a position where until country reaches certain GDP per capita they should be free from any IPO enforcements.

By the way the largest IP holder on this planet is also the largest thief of IP. This is how they've started.

The one child policy is an example of a highly organized authoritarian society making a big, potentially fatal mistake, because no real debate with genuine dissent could be had.

That said, it is possible that China will reverse this self-made problem by developing and mandating use of artificial wombs or something similar. Authoritarian societies do not have many ethical scruples when it comes to problem solving.

> But at the same time they don't have the positive image and reputation needed to be a big exporter of high-value goods.

Other than my car and some furniture, pretty much everything I've bought that cost more than $100 in the past 10-20 years has been made in China.

> Will a giant Chinese company ever gain the reputation of Samsung or Sony?

Perhaps not, but they'll likely continue to manufacture most of the products sold by the Sonys and Apples of the world.

Funny you say that because exactly the opposite thing happened to China. They were completely taken advantage of in the 19th century and didn't fully recover from that until a 100 years later when Nixon and Kissinger in one of their "4D chess" moves restarted diplomatic relations as a way to limit the Soviets.

From that point on they had a pretty clever long view policy but it would have been surprising if they hadn't. They spent the previous century getting fucked by foreign invaders, if they hadn't learned how to resist it by the 1970's then Chinese culture as we know it would have been doomed to collapse by the 90's.

And truth be told they almost did in 1989. If the CCP was a little less organized, if the military was a little less loyal and if the protesters had their shit together a bit more it could have turned into a full popular revolution.

A popular revolution in 1989 China would have restored Chinese culture. It was the CCP that squashed it.

> A popular revolution in 1989 China would have restored Chinese culture. It was the CCP that squashed it.

It would have plunged China into a civil war again and there would be millions dead. China would be a worse position now by every metric.

How can you compare China (population ~1.4bn) to any EU country (population average ~10mn - several orders of magnitude less, even in the case of the largest country)? Size is an advantage, not a disadvantage!

Pretty much none of the tactics would have worked for a small country that China played successfully. If you are small you can choose to be independent and protectionist - and remain very poor, or join the party, but be pushed into the corner, hoping that with time the playing field will level out somewhat.

Unfortunately for us the US will first need to learn that it’s better to keep US citizens out of prison, being productive in the workforce than locked up.

Broken window fallacy rules US economic thinking. Just that the broken windows are the lives of the prisoners and their families while the profits go to privatized prisons and their investors.

“several orders of magnitude less” for values of “several” equalling 2.... no need for the extra hyperbole.

They did sign those treaties (e.g. with WTO membership), they just ignored them.

And no one cared, it something that needs to be reckoned with.

They didn't exactly ignore them.

A WTO member can either comply with their treaty obligations (e.g. reducing barriers to trade) or have other members apply their own remedies (e.g. punitive tariffs.)

If the effect of compliance is worse than the punishment (e.g. underdeveloped industry eliminated by foreign competitors vs. continuing to operate despite high tariffs) they'll not comply.

If the punishment is worse (e.g. industry is basically competitive, but tariffs would make products hard to sell in foreign countries) they'll choose compliance.

At the bilateral level, there's not much difference to the pre-WTO situation, which might make you wonder whether it's all pointless. The advantage of the WTO is that it provides a shared target for compliance: if a country follows WTO rules, pretty much every other member will be happy with that. Which is a bigger incentive than having to please every trading partner individually.

> Whereas everyone who joined the EU in the decade of 2000 (and the Washington Consensus before that in the nineties) is now a pawn of the Western capital with no clear path of escaping the trap of mediocrity.

Not true. I hope you are joking. Most countries that joined the EU in the 2000s and 2010s become pretty westernized within 5 years of joining. Have you ever spent significant time in these countries, pre-EU or post-EU? Also, the countries that benefit the most from being EU members are the new members.

> So far, the standard of living in post-Soviet EU countries is still higher than in China, but that's because of the much better starting point and also because it's just hard to provide wealth for over a billion people in a modern, heavily automated economy.

The standard of living is pretty high in a lot of those countries, and not all of them are post-Soviet. Look at Malta or the ex-Yugoslav countries (Slovenia, Croatia) for example. I do not understand why westerners (particularly Americans) like to talk trash about the EU. I hope the Americans doing this realize where they are going, as in the wrong way, or on the wrong trend line. Of course America can wake up from being on some trend line, but to win the battles they are up against, profound societal changes will need to occur.

U.S. life expectancy will soon be on par with Mexico’s and the Czech Republic’s: https://www.washingtonpost.com/news/to-your-health/wp/2017/0...

Also, according to that article, American women's life expectancy is soon to mirror Croatia. You know, that war-torn, ex-Yugoslav country that had a nasty war in the 90s and displaced a lot of people. Americans should be embarrassed.

Life in the Czech Republic is fine, as far as I am concerned. No violent places like Chiapas in Mexico.

What isn't fine is the worldwide trend toward morbid obesity and metabolic disease. Americans, as usual, are the trend setters, but we are following them. That is what reduces life expectancy and especially life quality in nations that can afford to gorge on 100 pounds of sugar per person and year.

Yeah, I agree. I did not mean for someone from Czechia to take it personally. I am sorry about that and I will do better and be more considerate.

I am a dual US| EU (Croatian) citizen, who is culturally American. I live in Croatia. So, I hope you understand where I am coming from, even though I was wrong.

I also have type 1 diabetes (autoimmune and insulin dependent) which is a “metabolic disease”. It is more appropriate to say “type 2 diabetes” or “diabetes type 2” or “insulin-resistance”, rather than a metabolic disease.

The issue with America is we have a lot of unnecessary death. It is not just obesity and type 2 diabetes, although that is a huge part of it. Our healthcare system is designed to create as much profit as possible, without having to improve the health of the people using it. We have no adequate public health infrastructure because of this huge profit seeking and we suffer because of a lack of regulation. This all causes unnecessary death.

Sooner than that I’d even say. Even a China with GDP per capita 1/4 of the US would pass that bar I think. 1/2 the US would make quality of living comparable to the US, given how relatively bad the US is in QoL, if you assume an urbanized priority vs suburban

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