Why is China smashing its tech industry?
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Xi declared this year that while digitization is important, “we must recognize the fundamental importance of the real economy… and never deindustrialize.” Right. China, remember, has a national industrial policy. It's expressed in the national 5 year plan, which is taken seriously and used to set priorities.
What those priorities are is no secret. The current 5 year plan, the 14th, lists them.[1] Specific technology goals are in blue boxes. Semiconductors, gas turbines, biotech, new energy vehicles, robotics, advanced agricultural equipment. Internet services are mentioned in the Plan. One key line section out here: "We will strengthen the economic supervision of internet platforms in accordance with laws and regulations, clarify platform enterprise positioning and regulatory rules, improve the laws and regulations concerning the identification of monopolies, and crack down on monopolies and unfair competition. ... We will intensify anti-monopoly and anti-unfair competition law enforcement and judicial efforts and prevent the disorderly expansion of capital."
If you think this isn't to be taken seriously, go back and look at the 13th 5 year plan and check off the completed items.
[1] https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Fi...
Actually, the CCP never formally accepted the foreign stock ownership structure, for example. It was always a grey area.
Nah, a lot of people just don't read the articles before commenting, whether it is on HN or anywhere else
Similar to Tesla's secret plan to produce cheaper and cheaper vehicles at larger scale, the boring truth isn't a big click winner.
Think if Equifax got pulled for "leaking" user data
[1] https://www.librariaeminescu.ro/ro/isbn/606-020-215-8/Vlad-P...
There's identification of very specific technologies that currently need to be imported: "high-purity electronic materials such as photoresists for ICs." There's realism rather than hype: "Promote the demonstration operation of the C919 large passenger aircraft and the serialized development of the ARJ2I regional passenger aircraft." The C919 project, to build an airliner comparable to the Airbus A320, hasn't been going well, although prototypes are flying. So the goal for this plan is merely "demonstration operation". The ARJ2I is a 90-seat or so regional airliner now in early production. So those goals should be met. "Dominate world aircraft industry" might be nice, but that's not in the 5 year plan.
There's a longer range 2035 goals document, in which one goal is to get GDP per capita up into the middle of the developed country range.
This hasn't been really put to the test yet, has it? What's the cost of labor delta compared to the places where outsourcing from China would be attractive currently?
The Germans do it differently and can get a better return investing in themselves.
In China they have invested heavily in the robots that make the robots. Sure they are playing catch up in some areas, for instance, chips where they don't have a TSMC yet.
Even farming, where do those green and yellow tractors go? Cotton picking in China.
Some China tech is way ahead of the rest of the world. The difficulty of competing is getting really hard hence sanctions against Huawei. They had got 5G and The West didn't even know what it was for.
We have seen it before, Japan was way ahead with electronics and commodity cars. But China has a vast internal market and can proceed without making cheap goods for the West. If Western companies want to outsource to Burkina Faso then fine.
Also into the mix is that Chinese brands are desirable in China and increasingly abroad. China has barely got started.
I have few bridges in Brooklyn to sell, good price.
Yes. Their textile industry has been gradually leaving for much of the past decade, as cheaper production exists in several other countries at this point. Textile dominance by China peaked around 10-15 years ago. They will lose labor cost sensitive industries to their cheaper competitors as their economy continues to climb, as labor costs continue to climb. It took many decades for the US textile industry - the world's largest for a while in the 20th century - to be worn down by this same process. During the first 2/3 of the 20th century the US was often a leader in inventing new textile technology and manufacturing processes. Toward the waning days many US textile makers tried to modernize and or consolidate their domestic operations as a competitive advantage, it didn't stop the process. Most sent their manufacturing overseas ultimately. China is currently attempting to modernize, reduce labor in the manufacturing process, and that also won't stop the industry from leaving. Textiles are one of the first major industries that tend to leave due to being particularly labor cost sensitivity.
China is still the world's largest textile exporter, and may retain that crown for a long time yet given their size. A large chunk of their market share is going to be gradually dispersed across two dozen other nations.
Vietnam for example became the largest textile exporter to the US in 2019 (pre pandemic), overtaking China. Vietnam's GDP per capita is $3,600 versus $11,800 for China. Vietnam is in the position that China was 15 years ago in that regard. China will struggle to compete with labor that costs 1/2 or 1/3 what theirs does.
If the US could automate low-value manufacturing through robotics and get a significant cost advantage over China and pull back much of the low-value manufacturing that it lost, while getting very little labor benefit in the process, it would still be ideal for numerous reason to achieve that outcome (tax base, deprive China of that value, onshore capital and technology investment, some construction & maintenance value, wider economic ecosystem, and so on).
China's big problem with this process is of course that they have 1.4 billion people. High-value replacement jobs for so many of their low-value manufacturing workers is something beyond difficult (you don't need 100 million software developers to build China's tech infrastructure; you don't need 10x the workers to build as many planes as Boeing or Airbus do). High-value manufacturing for example doesn't absorb labor like low-value manufacturing does. Their social welfare costs over the next 30-40 years will be extraordinary as their demographics rapidly shift toward being an older society. They're already into a workforce decline demographically, those aging & retiring workers begin to shift more to the liability column in terms of cost. They need their workforce employed and pumping tax dollars into the system. Automation is not China's friend, even if they're the ones doing it to themselves (if they had a critical national labor shortage, that would be a different matter).
If China were to take over all of Germany's auto manufacturing (obviously we're talking a huge share of the global auto market), how many jobs is that worth to China and how does that scope to their 1.4 billion context (Germany has a mere 83m people)? What does something like that do for their context. That's the essential China labor and automation problem going forward. They could conquer a lot of high value manufacturing and be worse off overall than they are now, unless they can somehow keep all of their people employed, keep most of their low-value manufacturing employment simultaneously. And if China did use 4x the labor to build the equivalent of Germany's auto output (say they absorb their labor oversupply that way), that then caps the ability for that labor to rise economically, the margins won't be there to support far higher incomes, which has serious social consequences in terms of stability in China long-term. China would probably need to own all high-value manufacturing globally to both keep their people employed and keep incomes rising like they have been.
I think this question of unemployment and underemployment is one that's simply going to get worse everywhere, and I don't see a non-political solution. I just don't see a realistic way to employ everybody, or even a majority, in a high automation society.
So my feeling is, the countries that will be best placed to tackle this are the ones that are able to push forward a political solution. I'm not entirely sure of how socialist china is, but there are certainly some socialists in the CCP who would be perfectly happy for everybody to be unemployed or underemployed, and to pay for them from the profits of highly automated industry.
I think it's probably a question of ideological flexibility. Because China is both officially marxist, practically capitalist, traditionally confucian, and pragmatically developmentalist, they have a lot of options open when it comes to political solutions that western countries don't. So they could, for instance, just pay everybody UBI, then point out that China is a socialist country if elites object. That would be a harder argument in officially capitalist countries.
I don't imagine they'll go that way, but I guess the basic point for me is that productivity, employment, and welfare are largely the result of political decisions. You can run the economy like they did in the DDR, where everybody had a job even if it was totally meaningless. You can run the economy like in Japan, where if you have a job, you'll probably never lose it. These things have different tradeoffs. The biggest challenges are usually how hardened the political discourse is around work itself.
Honestly, I think the PRC's hubris is more than matched by the US's (and Western world's). They're still overconfident from the collapse of the Soviet Union, and seem to think the chips will inevitably fall on their side, so they still engage with a large amount of wishful thinking.
> And the ones that initially built the factories in China, can always pack up and move to a different country. So global corporations are now kind of "cycling through" a list of alternate underdeveloped countries to build factories in, and keep going until the options are all exhausted.
I'm not so sure...
1) I think it's ultimately the PRC's goal to have domestic champions replace those global corporations in the global economy (e.g. Apple declines as Huawei ascends)
2) I don't think the PRC is as stupid as the US was, and will not allow those companies to "pack up and move" to the degree it's disruptive to their ability to provide an unmatched manufacturing supply chain.
Yes, I still definitely agree with that one. US’s hubris is the undeniably the largest in the world.
> I think it's ultimately the PRC's goal to have domestic champions replace those global corporations in the global economy (e.g. Apple declines as Huawei ascends)
Maybe, maybe not? We’ll see if this goes well as planed. Easier said than done.
> I don't think the PRC is as stupid as the US was, and will not allow those companies to "pack up and move" to the degree it's disruptive to their ability to provide an unmatched manufacturing supply chain.
The point is, companies are already doing this. You’ll be surprised how much conglomerates like Samsung has already taken production out of China.
My understanding is that China's manufacturing supply chain is so well-developed that companies like Apple don't think they even have a choice except build their stuff there. The only things they're missing are a few things at the very high end. If they lack a commitment to free markets, its conceivable that they could use that advantage to slowly strangle their global competitors (e.g. allow their domestic champions a price/quality/volume advantages, while keeping the value proposition for global companies just good enough that continued dependence makes economic sense). To counter that, the US would also have to take bold steps away from free market dogma, against the interests if its corporate sector, which has relatively more political power, and against its reigning ideologies [1].
> The point is, companies are already doing this. You’ll be surprised how much conglomerates like Samsung has already taken production out of China.
I'd be interested to know how truly disentangled they are. My understanding is that even when companies move production away from China, they're still seriously dependent on China's manufacturing supply chain (e.g. they have to ship all the components from China to Vietnam for final assembly). I'm not aware of any efforts to replicate the range of capabilities elsewhere.
[1] The right would have issues with stepping away from free market economics, and I think the left would be skeptical of the international competition aspect.
> Two decades ago, as Apple’s operations chief, Mr. Cook spearheaded the company’s entrance into China, a move that helped make Apple the most valuable company in the world and made him the heir apparent to Steve Jobs. Apple now assembles nearly all of its products and earns a fifth of its revenue in the China region. But just as Mr. Cook figured out how to make China work for Apple, China is making Apple work for the Chinese government....
> No Plan B
> In 2014, Apple hired Doug Guthrie, the departing dean of the George Washington University business school, to help the company navigate China, a country he had spent decades studying.
> One of his first research projects was Apple’s Chinese supply chain, which involved millions of workers, thousands of plants and hundreds of suppliers. The Chinese government made that operation possible by spending billions of dollars to pave roads, recruit workers, and construct factories, power plants and employee housing.
> Mr. Guthrie concluded that no other country could offer the scale, skills, infrastructure and government assistance that Apple required. Chinese workers assemble nearly every iPhone, iPad and Mac. Apple brings in $55 billion a year from the region, far more than any other American company makes in China.
> “This business model only really fits and works in China,” Mr. Guthrie said in an interview. “But then you’re married to China.”
BFRI and VIEL for anyone whos interested.
Sounds like smashing to me. Smashing down on private companies and innovations. Smashing down on private wealth and power. Smashing down on freedom and growth. You can tell the dictator is getting desperate if he stops the train of innovation.
Also, do you really think innovation will come from state companies? In that case, why didn’t 1980 China or 1980 Russia thrive?
You need a stronger argument to prove that state-associated companies can't innovate.
There's also plenty of counter examples too. The internet itself was largely created via DARPA, a US state-sponsored research agency. Ditto for the space station and most other space-related achievements prior to SpaceX.
I think the more nuanced, and boring, view is that a well functioning state can innovate, and so can well functioning private companies.
This comment probably isn't the place for it, but I do think for-profit companies will tend towards different sorts of innovation than for-the-public-good government agencies... but yeah, not for this comment.
It's totally consistent with their long term plans since the 90s or so.
Maybe it‘s about time to read the Chinese 5 year plans in depth.
Even to take it down a notch, what has happened in the US is just boring. You almost can't have a conversation without one of 5 of the same companies coming up.
In the perspective of Chinese government, it is simply unacceptable that a toilet ordered by the air force cost more than $20k, or the number of ship manufacturers diminishes over years, or the average age of NASA engineers went from below 36 to above 55, or the best minds of the country spends their prime time figuring out how to increase CTR for ads revenue. Manufacturing and advanced research is a key to a nation, and China recognizes it.
Why do people get hung up on this? Specialty parts cost a lot.
To have a trained air force employee designing toilet seats is questionable, is that what the military should do? Maybe and the air force should explore 3D printers, so it's a waste that might be worth it. But lets not pretend $10,000 went to $300.
The Air Force’s $10,000 toilet cover - https://www.washingtonpost.com/business/capitalbusiness/the-...
I wonder if there are any follow ups on what else they 3D printed?
The military is kind of an odd organization. As the world in general increasingly specializes, the military doesn't. Not really. At the end of the day the military is there to "interface" with the rest of the world - and that's basically been how it was and how it's going to continue to be. Them having knowledge of how things - even toilet seats - are manufactured could be legitimately useful in their military function. It's essentially letting them get a first-hand view on how the world - particularly in terms of manufacturing - works. What steps, technology, infrastructure, etc etc are required to build things?
Ideally of course they would, and still should, get subject matter experts in to advise them for strategy and planning and all that. But it's somewhat naive to suggest this is likely to work perfectly all the time. It rarely does, because humans are going to human. If they can get some hands on experience it gives them some trusted internal people who can better communicate with the subject matter experts and ultimately reach better conclusions.
I think what's important is not they bought 3 toilet seats for $10,000 on planes that costs $100,000 a hour to fly.
Universal Camouflage Pattern costing $5 billion to develop and make, then gets ditched because it sucked feels like a bigger story. How does that happen.... Isn't that the military's main interface with the world.
The US government and military do plenty of things badly, and plenty of things well, and practically none of the people discussing them have any idea what either category actually contains.
Additionally as always with complex regulations and specifications there are ways to comply maliciously. This means comply by letter but charge for bullshit.
Another bonus are hurdles to enter the market for your competitors. If they don't know how to talk with government and comply they can't sell to government. This makes things expensive for government.
If every single part of the toilet has to be manufactured from raw materials, and fully tested and documented at each step of the manufacturing process, then a toilet can add up to $20k easily.
Also, anything that will be installed in a regular old non-military passenger plane is extremely expensive, because they must be able to prove that parts will not break off mid-flight, that it will not catch fire, and will be manufactured consistently and reliably.
I do agree that "power" is the issue here. It doesn't take much for China to look at how Bezos or Elon act and say "yeah, no, we're not going to have corporate leaders challenging the Party publicly".
Now the thing about five year plans was that they worked rather well at the beginning, so approximately until 1960. Back then, the economic power of a country was measured by its heavy industry, and in a post-WWII world where there was war damage to be fixed, an entire eastern part of the country (Slovakia) to be modernized from its earlier rural state, and new housing stock to be built, concentration of our five year plans on heavy industry made sense.
But slowly the world development started to diverge from the coal-and-steel line. And our central planners didn't take notice, or rather underestimated the significance of that development. They had, after all, a lot of success earlier with coal and steel, so they continued to plan for more coal and steel. Also, a lot of workers in those industries were card-carrying members of the Communist party, so it made sense to reward them for their loyalty.
We slowly lost our development edge, fell behind the West in automation, computer technology, semiconductors. The overemphasis on industry led to major ecological problems and pollution, and the emerging ecological initiatives proved to be a fertile ground for opposition. In 1989, the regime fell, and we were left with a huge, absolutely bloated, but mostly obsolete coal and steel industry that could not compete anymore. And its subsequent collapse was a source of significant societal disruption.
I saw the collapse of that industry first hand, growing up in a coal and steel city (Ostrava; just take Google Maps and look at the enormous chunks of industrial structures located literally inside the city, with residential buildings right next to the factories).
Now China does not seem to fall behind yet, they also allow a lot more capitalism than Communist Czechoslovakia did (in our country, even a private café was a rare sight; the regime was so ideologically pure that it purged even most self-employed people from independence into formal jobs).
But I can see a similar "it-must-stay-the-same-itis" in their proclamations that the country must never deindustrialize. Never is a bad word in mortal's mouths. If they fixate on industry at the cost of all other developments, they may go down the same route as Czechoslovakia eventually.
There isn't such kind of boneheaded inertia in China. Yet.
That is price paid for a system that kept a totally dumb person at the head of the country for 12 years. And when we got rid of him, the Soviets arrived in their tanks to correct our heresy (1968).
As for China - TBH we do not yet know what happens within China. The flow of information is fairly restricted. A lot more of the economy is outside direct control of the Party, and those parts of the economy are likely to be fairly functional; they have to compete on the international market, after all. But within the Central Commmittee, I wouldn't be surprised if boneheadedness wasn't a significant problem. Many politicians are of the "dumb, but cunning" sort, even in the West.
There's some of that. There's an official push in China towards self-sufficiency, and eliminating reliance on imports. The US used to have such a policy during the Cold War.
The coal and steel fixation created the European Union, which was originally "the European Coal and Steel Community". Britain grew to be a world power through coal and steel. As those declined in importance, they were taken over by the Government, under what was derisively called "lemon socialism". There was British Steel, British Coal, British Rail... All the old labor-intensive plants.
China has problems with inefficient state-owned businesses, which tend to be jobs programs. They're mostly owned by provincial and municipal governments, not the national government. Lots of steel mills and coal mines, inevitably. But since they make steel for export, they can't be too inefficient.
Excellent observation, and I hope, for China's sake, that this is the reason.
The United States is likely in for a long-term rude awakening when it finally realizes that an economy predicated on negative-value-add activities like clicking heart icons on photos, repackaging financial securities into products with impossible-to-detangle risk profiles, advertisement and addiction optimization, and political outrage, will not remain any definition of "global superpower" for long.
Facebook and Netflix are excellent examples of companies that contribute greatly to our GDP whilst simultaneously draining our reserves of actual capital and mental health.
I'm old enough to remember the general optimism we in technology had about the unlocking of human productive potential as automation and globalization freed us from the constraints of scarcity. Marshall Brain, Clay Shirky, and many others write extensively on this zeitgeist.
But that's not what ultimately happened. the zombification of our attention that began in the 1950s has accelerated in the last two decades. We're not volunteering our free time to space exploration collectives, life extension self-experimentation in biohacking hackerspaces, or even traditional enterprises like Habitat for Humanity.
We're clicking heart icons on posts bemoaning billionaires conducting private space exploration, getting angry at CRISPR researchers on Twitter, and passively consuming "marathons" of Hollywood renditions of dystopian future worlds.
This is to say nothing of the fact that we don't even have all that much more free time to begin with. Not because we're all working for SpaceX or in cancer research laboratories, but because the vast majority of the very people CAPABLE of doing so (IQ is in limited supply and not evenly distributed) are actively recruited to make iphone apps more addictive, make pornography engagement higher, and make front-running retail options order flow faster.
Apropos of Netflix (or in this specific example, Amazon Prime Video): There are likely 40 million hours passively poured into marathons of The Expanse in North America, by people with an average IQ in excess of 115 (just by virtue of the type of audience). What if half (approximately the NA/Asia split) of those hours were instead poured into activities that actually got us closer to the technologies depicted?
Well, the Chinese are doing it. We're not.
But even there, you're wrong about the activities/technologies you're complaining about. HfH, food banks, shelters, and other non-profits with limited capacity for volunteer work have wait lists several months long in my area. Only billionaires can explore space right now, so why would the rest of us be forming space exploration collections for something that is still a decade or two away? Tons of people self-experiment or participate in bio-hacking; this simply isn't the forum for them to discuss their projects.
Well, the Chinese are doing it. We're not.
Really? Citation needed that millions of Chinese are working in the free time on any of what you talked about.
Sci-fi has a long history of inspiring technology, eg Tsiolkovsky
That's pretty much a game of predict the future, get it wrong on economy scale and you don't have anyone doing anything not according to plan... you can / will get a disaster even if you get it right here or there.
And I'm not sure that's the point anyway. China could simply ban "clicking heart icons on photos" and wipe out domestic demand outright, and as far as risky financial deals ... China seems to have no problem with that.
No. The GGP's examples are a direct counterexample to that idea.
Being a little more general: based on past experience, I interpret general complaints about "regulatory capture" without further clarification as complaints about regulation in general and advocacy for "market solutions" as an alternative. However, a poorly regulated market will almost certainly result in a great many monopolies and businesses that convert some negative externality into private profit, which are the apotheosis of the idea that financial value != value to society.
> a poorly regulated market will almost certainly result in a great many monopolies
A market regulated in poorly thought through ways can certainly lead to monopolies. But monopolies specifically are almost entirely due to regulatory capture. Case in point internet service in the US is almost always given either a de facto monpoloy or a straight up legislated monopoly for a particular area. That's why internet service in the US sucks so much. Countless regulatory burdens on businesses are designed to favor large companies, and is one of the many regulatory reasons that companies merge so often and industries in the US are oligopolies.
And that's not to mention the actual government run monopolies like utilities and the post office. It was despicable that the post office killed Outbox and prevents people from using their own mailboxes however they want. https://smallbiztrends.com/2014/05/usps-killed-outbox-mail.h...
If the US had good representation, maybe the regulations it creates would generally benefit the consumer rather than entrenched business interests. Unfortuantely, that's not really the case today.
Our politicians are influence (unavoidably!) by the people who have the most time and money to spend lobbying them. Even if you reformed lobbying, this would still be the case - even if it was all just letter-writing with no money attached. Wealthy people could send way more letters than harried poor ones.
So the more you have, the more influence you get. BUT the more you have, the more you can fend for yourself, so also the less you need much of that influence! And then the government being unaligned with the needs of most people starts making a lot of sense, without even needing malicious conspiracies.
There's neither profit for businesses nor politicians in giving poor people what they need.
There appears to be a real corruption problem in the US that is distorting what politicians can do for poor people.
Successful parents and sage founders define value differently.
They don't see dollars. They see sense.
I am unsure what colloquial definition GP refers to as the counterpoint. Surely you aren't both suggesting sense and dollars are non-overlapping?
The difference is the perspective of time.
A quick buck versus a strategic investment.
e.g. What made sense to Page and Brin in 1998 - the algorithm that would become famous as Page Rank, had only a trivial market value at the time, whilst Yahoo was "worth" billions.
AKA: you vote with your wallet but some people vote 0 times, some 1, some can cast one million times - if you do the math.
A further productive update to your worldview might be "The degree of centralization of power is proportional to how far out of equilibrium a market can get." This doesn't just function at the macro level (i.e. Google/Facebook/Bezos being able to horribly misallocate capital based on their past successes). It also explains things like bad executives within a corporation: because decision-making is centralized and the results of a decision won't be seen for years, a bad executive can waste billions of dollars and thousands of man-years, but ultimately they're going to get kicked out (or the company goes bankrupt) and the organization will return to market norms. This is also one reason for the liquidity premium (and hence high compensation) for executives: since the consequences of a bad hire are so bad and so future-loaded, companies tend to be overcautious in their hiring, which means only people with excellent pedigrees are considered and they can demand a premium for it.
Also very relevant to historical China, which had this habit of centralizing extreme power with the emperor. Things would go great if you had a good emperor. But occasionally they'd make a blunder (like the cessation of the Ming treasure fleets) that profoundly altered the course of human history. The European powers had much more decentralized decision-making. When Columbus was turned down by the kings of England, France, and Portugal, he tried Spain, and the rest is history.
Would you say that the value of feeding the orphan is zero?
Would you say that the value of chasing those asymptotic improvements is enormous?
Key observation: the market notion of value is very different from what people would colloquially agree is valuable.
Economists would say this is obvious. In one sense, it is -- we've all seen it in a million (hopefully) less-extreme incarnations. However, if you were to watch these economists closely, within 60 seconds of claiming it was obvious, they would kick out an argument that fudges the distinction between the economic notion of value and, well, value (the colloquial notion of value should really need no qualifier -- I applied one above simply to highlight that it had been hijacked).
That's the bit to pay attention to: substituting the concept of "economic value" for "value." This innocent-sounding approximation is actually a trojan horse containing extreme laissez-faire assumptions. With a mere slip of the tongue, they invite you (or you invite yourself!) to assume the conclusion of any economic rationalization, cloaking whatever cockeyed scheme the markets have cooked up today in a veil of artificial legitimacy.
Anyway, the day I plugged this into my worldview and forcibly separated the concept of economic value from the concept of value, something interesting happened. I previously had two competing views of the economy:
1. Gee, it sure seems to always act as a mercenary for the rich and powerful an awful lot.
2. It is a tool for revealing, weighing, subdividing, balancing, and reconciling collective preferences, both directly and transitively.
Before I separated the notion of "economic value" from the notion of "value" in my head, I was willing to accept that perhaps the hierarchies and mercenary behavior of #1 were merely emergent properties of an optimization process that truly did maximize value per #2. (Note -- I said "value," not "economic value." Did you catch that?) I saw this as a deeply legitimizing factor for economics in general, especially because I was keenly aware of failures in the colloquial definition of value (it's really bad at transitivity, for instance).
After I separated the notion of "economic value" from the notion of "value" in my head, I realized that the weighing factor made the optimization process of #2 equivalent to the mercenary process of #1. If a few people have all the money, then "weighing collective preferences" just means doing what those people want. To the degree that's currently the case, the optimization process is a silly ruse. It's a continuum, though. If everyone has some money, everyone gets represented in the decision making. If a large group of people -- say, "the middle class" -- has all the money, their collective interests will be well represented, but those on the bottom get drowned out. "Economic value" begins to diverge from "value." If a few people have all the money, they are the only ones who decide what's (economically) valuable, preferences of everyone else be damned. "Economic value" diverges completely from "value." In short, the divergence between what's valuable and what's economically valuable is proportional to the level of inequality.
The subtle nastiness of this situation is that the system runs away. You start with market forces that truly do represent the collective will of the people but as the wealth starts to concentrate more and more, the weighing factor increasingly disregards the voices on the bottom and pays more attention to those on top. Stocks go up, jobs disappear, rent increases, wages stagnate, poverty skyrockets -- apply the weighing factor and you see that none of these are bugs. They are all features. The predictive capability of our worldview has increased.
There is hope, though. Chaos is the enemy of skewed wealth distributions, of consolidated power, and ultimately of this divergence between value & economic value. There are exponentially more ways for wealth to be mixed than for it to be concentrated, so any kind of chaos can make it happen. Capitalism is anti-fragile -- it degenerates into feudal exploitative nastiness if you leave it alone, but if you stir the pot once in a while it truly is the marvel that economists paint it to be. How to do that? Well, in the happy case the chaos comes from growth. In the sad case, it comes from violence. Here's hoping the next big upset comes soon and from growth, rather than stagnation and eventual violence.
In housing, that's zoning for single-family houses which limits affordability and provides exclusivity vs. apartments or boarding houses, except in downtown cores which aren't enough supply to really move the needle (and expensive for other reasons).
In US healthcare, it appears there is regulatory capture from insurance companies and private health care providers, both successfully ganging up on the government to minimize real competition or strict price regulation.
Without real competition for a product that consumers can't feasibly opt out of, no heavyweight market participant interested in driving the price down, that's what you get. But yeah, testing is good too. Get the government to try out 10 years of broadly available at-cost housing competition and public healthcare, then evaluate :-P
That's a difficult question to answer generally, however it's also clearly not one that markets "solve." That's easy to see with the example of addictive drugs (which the market shows can be very profitable), unless you're willing to argue there's social value in destroying many people's lives through addiction.
That's not to say that financial value and social value aren't sometimes aligned, it just that you can't assume the former implies the latter.
One little thing I find annoying is that whenever someone points out some issue with free markets, someone always seems to reply with something that amounts to "have you considered free markets?" Whatever the problem, markets are the solution, even if the problem stems from markets themselves.
The Soviet Union had serious problems, but it's a mistake to reason from that to the conclusion that markets are in some way ideal. They have their own problems, and we don't have access to an ideal system, so we have to try to deal with individual problems and make tradeoffs.
Maybe Free Markets were the best you could do with the quantitative decision-making tools available to Stalin, and maybe central planning with modern AI/ML/Operations Research techniques would be more successful than a free-market approach.
Or maybe, the Soviet Union would have done just fine if there were no United States trying to thwart it at every turn.
- Arthur Jensen (Network, 1976)
Beyond that, the Soviet economy was solidly middling as far as the world was concerned.
As troksky said "In a country where the sole employer is the State, opposition means death by slow starvation. The old principle: who does not work shall not eat, has been replaced by a new one: who does not obey shall not eat."
Who gets to decide what is allocated to whom? Giving these starting conditions it's no wonder in every single attempt at this has resulted in a death toll in the millions. Nothing the USA did from the outside forced these countries to starve, imprison and murder their own people. Why didn't this happen in the USA? Or the rest of the west? Why only in regimes that tried to control more aspects of an individuals life then ever attempted before? Most of the argument I am making is a poor rehash of "the road to serfdom".
https://www.goodreads.com/book/show/299215.The_Road_to_Serfd...
Blaming the west for the terrors of Soviet Russia is as mistaken as blaming the allies for what the Nazis did in Europe.
I’d be surprised if there aren't neo-Nazis that argue exactly that, just as modern Leninists argue that Soviet Communism might have worked out great for everyone if it wasn't for the USA.
No. That, along with the rise of Communism in Russia, the rise of Italian fascism, and...was among the indirect causes.
Beyond that, the argument of starvation is flawed, because Russia in the market system had worse famine than the USSR, and crucially, the USSR ended famine in the Russian Empire, not started it. You can argue there were unnecessary famines, and you'd be right, but saying that famine is an inevitable component of the Soviet system is wrong because there were one/two, at the beginning, and then none after.
The actual limit to Central Control assuming that the people doing the central control are willing to let consumer goods follow what people want is data and the ability to process it. In the USSR this was very low - data collection was manual and plans were updated every 5 years. The bureaucracy opposed every attempt to improve the situation as that would usurp their power. Beyond that the freedom that individuals can have as far as what to buy and which jobs to build is only limited by what others are willing to work for.
It's also not true that they attempted to control more aspects of someone's life as ever before. Feudal states had much more control than the Soviet state on their inhabitants. Some capitalist states had more control.
There are arguments to be made here. A poor rehash of a poor book written by an author who openly admitted that he started with conclusions and worked backwards from there is not one.
The reality is much more complex than market=good everything else=bad. Heck, even the Soviet weren't always opposed to markets. Their ideology didn't even explicitly oppose markets, only class distinction in production.
This is not correct. The authority is there, it's just less visible.
Market forces are extremely unequal: a small percentage of humanity, e.g. 0.1% influence 90% of the value of the housing market in all popular cities in developed countries.
One thing is watching some dumb action movie once a week, another thing is filling one's free time with entertainment every day.
I think you have this backwards. These social networks are predicated on the businesses that are generating enough revenues to spend on ads with them.
EDIT: To add some more context USA GDP in 2019 was 21.4t . Facebook's revenue is 0.004 of that number.
Netflix is not draining capitol and not sapping mental health. It was a massive innovation that saved people lots of time (wasted watching TV ads) and money ($10/mo rather than $100/mo for TV). It worked so well every other major media company has copied it's model.
Facebook is often shit on, but it was useful in it's time. It's a tool people can decide to use oe not use, and how to use it if they do. We're learning as a society how to do this.
But it's very clear the solution is not for a government to smash those companies. That is very clearly an evil action.
It feels like there can never be a trustable implementation of a "value or rentseeking?" oracle, since the system implementing it would also be under selection and pressure from the virtual gains to be had from corruption.
One thing to note is that governments themselves are, by definition, rent-seekers. This is inherent to how a government - a monopoly on the legitimate use of violence within an area - works. Once you are sovereign within a territory you can extract rents in the form of taxes, and if you don't extract enough you will be deposed by someone who does.
Most governments also tend to encourage their own industries to rent-seek as well. If your country needs heavy industry or scientific research or cultural behemoths, it's far easier and politically defensible to construct new narrow property regimes (e.g. copyright, patents, PDOs, etc) for those companies to exploit rather than just paying them subsidies. These regimes can be selectively weakened when you need to build your industry domestically (what the US did to the UK, or what China did to the US) and then strengthened later when you need to protect it internationally (what the US forced into WIPO).
Very little of capitalism is actually adding value, in the sense that you have a business that hires people, buys materials, and turns them into goods and services at a prevailing market rate. At the lowest rungs of the chain, sure - you might have, say, petite-borgeouis crustaceans hiring workers to cook food and sell it to people who need it. But that's not where most of the actual profit is. Compare that to, say, a fast-food franchise; which doesn't usually run any restaurants or sell any food. They instead sell trademark rights and supplier relationships. In particularly egregious systems like McDonalds, they even rent their franchisees the land that the restaurant must be housed in.
Left-wing critiques of capitalism are typically extra-cynical about this, and would consider even the small profit Mr. Krabs makes on burgers to be rent, not value. This is usually in the context of the employee-business relationship, however; not the business-customer one. Small businesses generally don't extract a premium on the goods or services they sell just because they're the only company that happens to own a stove or know some secret recipe. But in the context of employees, they are getting paid less for their labor, albeit in exchange for not having to bear up-front capital costs or deal with inconsistent revenue. Whether or not this constitutes rent or value is most likely a political opinion, not something that you could actually devise some economic criteria for.
* Someone who literally figures out a new, cheap way to make a drug which cures a real disease
* Someone who, as soon as they get the right to, imposes license fees which serve no valid purpose, and profits in status & wealth from these new duties.
The original idea with these sorts of things, at least in the US, is that we'd have administrative procedures and court adjudication to limit the harm that could come from that behavior. In practice, the administrative procedures are only a bar to the least knowledgeable plaintiffs, and the mere threat of litigation over a marginally valid claim is often enough to coerce most defendants into a settlement. Nobody wants to actually litigate whether or not a patent is obvious, or a copyright owner has been surreptitiously seeding their own works on BitTorrent.
There's also a question about whether or not your two examples are, in practice, always different cases. What if the person in the first example decides to not license their drug at all, so they can do the manufacturing themselves and control the price? That would be identical behavior to the second example... but they still made a useful invention. They're the same person.
You could legally restrict "non-practicing entities" from enforcing patent rights, but that's only a subset of all rent-seeking patent owners. Remember: the entire point of the system is to enable rent-seeking in lieu of up-front payments.
In other words, once it becomes feasible to 'follow the money', it'll be somewhat trivial to see who's doing what and to what ends.
Notice that this problem doesn't exist in smaller communities, because everyone knows what everyone else is up to.
This is a data access problem that persists because it is profitable for people who have the power to keep everyone else in the dark regarding their machinations.
As in, allow entities to make a handsome profit, far outstripping their original investment. Just don't allow them to profit off of it forever. Patent and copyright expirations are a proxy for this, but they don't take into account the actual money & time invested, instead they replace them with a hard-coded magic number which will work for some products and fail for others.
From https://en.wikipedia.org/wiki/Real_economy
"The real economy concerns the production, purchase and flow of goods and services (like oil, bread and labour) within an economy. It is contrasted with the financial economy, which concerns the aspects of the economy that deal purely in transactions of fiat money and other financial assets, which represent ownership or claims to ownership of real sector goods and services."
Perhaps it's about selfishness?
The obvious losers would be landlords (the literal definition of "rent-seeking"), because without that piece of paper, there's just a tenant that lives in that apartment and you have no claim on any of their money. A carpenter who actively builds a house, however, is creating value: even without the state, people still need houses, and he has useful skills for things people want. Financial assets would crash, trademarks would become worthless, there'd be open season on patents. Medical care is still creating value. People who grow and prepare food would be very useful. Software engineering is in the middle: new software that people use is creating value, but just sitting on a service that you own exclusive rights to because it's protected by copyright & trade secret laws is rent-seeking.
This also illustrates a lot of the confusion between the two. Without the state to enforce contracts, there's no way to tie "the value you create now" with "getting paid for it later". When a carpenter builds a house, he now owns a house that he can pay for later - but without the state to enforce his right to the deed of his house, he's got nothing to sell and no reason to invest the labor in the first place. Same with the service that the software engineer creates and the drug that the biologist discovers.
You could look at rent-seeking as "property rights that have extended beyond the public's attention span".
I'm seeing an incredible amount of ads for companies that let you gamble real money on your phone. Sometimes it's back to back to back to back commercials for online app casinos. This seems really dangerous and a sign of a tragically unhealthy and predatory economy - I can't think of anything more negative-value-add than gambling. Has there been a regulatory change that allows this, or has this been going on for some time?
https://en.wikipedia.org/wiki/Holland_Casino
It seems harmful to let gambling be unregulated...
Even loot boxes in games are illegal https://boundingintocomics.com/2020/10/30/netherlands-rules-...
It seems barely any better make a state revenue stream out of it.
We have the same thing on Hungary, there is one state controlled gambling company that's under heavy regulation (18+ only, full with warning signs against gambling, barely any advertisements, has only a few old-school products like scratch cards)
No stockholders who expect infinite profit growth, no CxO with bonuses dependent on increasing revenue, and has public oversight by default: government should be the only entity trusted to directly engage in any vice business. They are the only entity I trust to put honest effort in decreasing their user base.
If it's something like a police officer whose funding comes from collecting fines, sure, there are really bad incentives there. But if the government casino department isn't eating what it kills then it doesn't seem like a problem.
- corporation’s primary revenue stream
- local government’s major revenue stream
- state/federal government’s minor revenue stream
- criminal org’s major revenue stream (prohibition)
Given those choices, state+ size governments are least likely to paperclip-optimize for gambling “revenue”, and federal/national government would care the most about negative externalities since they compete with other nations, on metrics removed from raw “tax” revenue.
And the US has state lottos already.
There is a Chinese Internet slang "智商税" ("IQ tax"), used to describe products with questionable actual value, like pseudoscience-based health products, luxurious goods with crazy price tags. The idea is that only people with poor judgement would buy such products, and in doing so are being taxed for low IQ.
But a state-run casino... that's a literal IQ tax.
We also have state-run casinos in Québec, as well as state-run lotteries. They have a legal monopoly on gambling, except for some exceptions for bars and online betting which is practically unregulated.
I've never seen anything like this in my life and had the exact same reaction.
It seems like it's gotten a lot worse after COVID, though
I follow soccer, and right after that mlssoccer.com started publishing vegas betting odds for all the games, and ESPN FC started using UK betting odds for EPL and EUFA competitions.
They're definitely warming up Americans to the idea of normalizing betting and sports betting in the mainstream.
Keep in mind that black market sports betting is/was a multi billion dollar industry in the US so much of what you are seeing now is just more visible.
Now the NBA is heavily pushing gambling and the revenue that comes with it, In addition the NFL is also pushing fantasy football which is veiled gambling, a few years ago every commerical for an NFL game had 50% of its ads set to either draftkings or fanduel which are both gambling sites. So I see a huge predatory gambling cloud enveloping all sports which is a really sad turn of affairs.
It was actually less regulated. There were gambling sites for children based on electronic collectibles from video games. It was becoming a billion dollar industry before Steam put their foot down.
A friend was close to launching a venture in the space and their first year revenue projections were around 600k assuming middling/unimpressive growth (he was a teenager at the time, didn't really register how fucked up the business was). Medium-sized ventures in this space raked in several million and the largest were definitely bringing in tens of millions of dollars. I know at some point there were concerns of money laundering...
Playtika just IPO'd for 12B and they seem to mostly make gambling apps. I've seen people play them on planes and it's slightly disturbing. I took an SF -> Miami redeye once and a lady seemingly played it during the entire flight.
I'm like, you said that? are you trying to get banned?
TV aside, there has been some drama over this on Twitch. Streamers are shown gambling massive (to you or me) amounts of money daily. Kids watch this. It's entirely unregulated (maybe not in theory, but in practice). Some people have done investigations into the companies and they seem very shady. There's absolutely no reason to believe these companies aren't directly supporting or sponsoring the streamers monetarily, or even tweaking the numbers behind the scenes to make them lucky. It's been alleged for gacha games in the past, and I definitely believe people will go further for real money if they can.
Together, they power nearly the entire retail transaction market in China. Alibaba heavily drives commercial transactions and Tencent powers the vast amount of personal communication (WeChat).
They are quite profitable as effective monopolies, but are very valuable to society.
It's not so clear to me that this is true. The fundamental question is - if not this, then what? If you accept that people can only work a certain amount, then a "perfectly" "productive" society involves people working just that amount, and then going home and entertaining themselves the amount that is necessary to recharge, safely, and then repeating. If not Netflix, then what? Alcohol and drunk driving?
I'm not saying watching Netflix is what we should aspire to, but compared to the alternatives, it seems reasonably likely to contribute to economic growth. A passive workforce works.
To be fair, the quantity and availability of novels/fictions was pretty low before the fifties, so I guess there is some truth to it... Though the timeframe is definitely longer then only Netflix's existence
I'd happily veggie out on a couch with a favorite book series and live in fantasyland for days (alas, real world interferes...).
Given the option of gorging on books or gorging on Netflix over a long weekend dawn till dusk, I bet most people would choose Netflix. If you randomly divided the people into those two groups and made them read and the others watch, more readers would wash out than watchers.
I tried that. It soon becomes utterly boring, no matter how good the show is.
[1]https://en.wikipedia.org/wiki/Binge-watching
[2]http://www.buffalo.edu/ubnow/stories/2019/04/kruger-binge-wa...
No, it hasn't. It has been somewhat since the much more recent introduction of “on demand” programming to cable, but that was basically just the introduction of streaming into cable in response to streaming services.
I think "on-demand" is a blessing. We are no longer tied to broadcaster schedules, have to remember to "program the DVR", writers don't have to write a cliffhanger every 12 minutes for an ad break.
When Hollywood was built in the 1920's it was not exactly the backbone of the economy. The article argues that the Chinese Government sees value in the economy beyond GDP goes up and cash flows good. Technology and manufacturing are important to national security.
The article quote Xi Jinping saying “we must recognize the fundamental importance of the real economy… and never deindustrialize.” I guess the national question for the other super power is how important is this "real economy" to itself. Is too much talent and labor sucked up in profitable activity that is suboptimal for a nation? Are these 21st century company's like Netflix good enough for our nation?
This is a valid point, and I tend to agree with it. However I see entertainment as part of the "real" economy. It's an incredibly old industry, provides real value to nearly every human being, creates high-, medium-, and low-skilled employment across a wide variety of disciplines, can allow your culture to punch above its weight, and produces art that endures across generations and centuries (for example, Shakespeare).
Literally all you need to entertain people is talent and a space.
Long version: when you are facing internal party conflicts, alliance between US-UK-Japan-Australia-India-Taiwan-South Korea-EU which accounts for 90% of worlds wealth and war power 10x the magnitude and is against you, floods that gets worse every year, extreme heatwave that will eventually make Shanghai unlivable, delta Covid lockdowns, capital flight, demographic crisis, supply chain moving out, internal resistance from Hong Kong and tibet and xinjiang, and young generation lying flat. You are paranoid as hell and afraid to lose control so as to not get killed.
I'm not sure I believe it, but it's a bold prediction and worth thinking about.
I do think that every country in this world, whether it be the US, China, or my country, are experiencing the same effects from the current configuration of global capitalism (environmental destruction, extreme inequality, housing crisis, cutthroat job competition, long working hours, alienation, depression), and the only thing it's different is how state governments are responding to the crisis. Out of all the governments in the world, China seems ahead of some Western countries in a few aspects (as a one-party state being able to control and crack down on a lot of things and enable strict policies against over-financialization and deindustrialization). However, I still do think that China's strong state measures are only a stopgap measure for the more fundamental political and philosophical problems that the entire world has right now.
Also other countries prob don’t have the problem of “what if the dictator was killed or dies early, and civil war and political struggle ensues”
We've seen plenty how democratic countries can go through civil war and political struggle, this isn't something that only happens to dictatorships. And I am just so tired of the dichotomies most people have in their minds for the current form of state governments, both China and the US's political systems are complex and nuanced enough that you can't really call it communism/capitalism or dictatorship/democracy anymore. I was just comparing about which government is actually more competent than the other for dealing with the current problems in the world. One seems just a little bit more competent than the other, but that's as far as it can get.
By at least one metric, the PRC has managed to eliminate 'extreme poverty' (even Brookings agrees: https://www.brookings.edu/blog/future-development/2021/01/25...)
Now, you can come up with counterfactuals about why it would have happened anyway, and that's a pretty reasonable position to take. But acting like the $1k/month figure is somehow damning of the CCP totally misunderstands the domestic situation in China.
And the $1k/month folks are still having a hard time buying a $300k house to get married and have children, while taking care of the elderly parents. Meanwhile they know about the party princelings driving around in lamborghinis and buying fendi bags to show on social media. Oh yeah, the $100/month folks know too. And they know about the yearly flooding that kills.
You think people struggling now is going to remember the bad times before? Nope. That’s not how human natures like envy, anger and disgust works.
How much is actually happening? Fuck knows. The government controls the press and the metrics coming out.
I can see the disadvantage of the saccharine part of our economy and the advantages of focusing on nuts and bolts.
It’s the difference between letting people decide what’s right for them and having a more planned society. Obviously planned societies have been a recurring theme in history, most notably socialism and its chronological counterpart national socialism. Neither made good faith efforts and both resulted in millions of deaths. But we also experienced unnecessary deaths from unregulated parts of the economy, though not as many deaths and at least it involved more free will.
It’s less so in Asia. On the other hand we keep on shipping jobs overseas so people on the bottom keep on getting sold out for even lower prices.
People used to be able to get by as a janitor or landscapers. Janitors and landscapers have been replaced by low cost labor. We can have foreign workers and have economic viability for people who don’t go beyond high school. We still have mechanics, but not sure how long that will be an option with electrification of autos where there are diff requirements.
IMO, large parts of the tech industry are artificial and fueled entirely by monetary policy.
If reserve banks in the west stopped expanding the money supply, large parts of the tech industry would be wiped out; they would quickly be revealed as negative-value industries.
With limited autonomy over their own global monetary policies, this was the only way China could fix this problem.
Also, the moon landing.
Not so today
What's the equivalent of Shenzen in US?
https://www.brookings.edu/research/global-manufacturing-scor...
US is at 18% of global manufacturing vs China's 20%, but the US only gets 12% of it's overall GDP from manufacturing compared to China's 27%, and with about half the percentage of it's workforce (with a much smaller workforce).
If the US had to manufacture the products that are currently manufactured in China, the amount of dollars generated would be lower, or the share of people employed in manufacturing would explode. GDP would of course decrease.
I also think including this in the discussion will, perhaps, emphasize the nuance of what I believe you're indirectly referencing -- the economics of how humans choose to spend their time (sometimes referred to as the "Attention Economy").
I believe literally optimizing for something such as GDP fails to take into account freedom / liberty which is likely something most on this website would agree is incredibly valuable in a society.
I think the difficulty is in creating a consensus around what is acceptable relative to the "Attention Economy". It might even be impossible given that this seems almost indistinguishable from culture -- and there will likely never be a single unified culture if and until something as paradigm-shifting as a multi-planetary species is realized.
Video game bashing seems like another moral panic to me. People are spending more time playing video games than slaving away flipping burgers. So what?
The Video Game industry seems like its doing just fine without Government assistance. The Government can focus on investing in creating manufacturing hubs in the US instead.
Shortage of labor? Create a new Visa and citizenship pathway specifically for electronics engineers, while investing in US universities to expand the EE departments and scholarships related to EE.
Its all possible if the US Government wants to.
Which is why everyone capable tries to get into FAANG for AdTech. Nurturing people to think long term and to have a producer + explorer mentality will yield better results. Critical thinking with (endless) ambition is the key.
Even if the USA authorities subsidize EE study it is not certain that new grads will go into EE jobs and not into a bootcamp to respec. Get rich quick incentives like ones given by FAANG are really strong and it would take a lot to counter them. One solution, ironically, would be to do the same as China is doing. Dismantle FAANGs and the problem disappears. Smart people will flock to some other branch and maybe IT people will go to boot-camps to become EE on their own volition (free markets).
As you have articulated, innovation tends to manifest when humans spend their attention on things that also further drive the demand for their attention.
The point being that the context here is significantly more gray than black / white.
It's much simpler, cheaper and faster to simply import the ores via land from Asia. Which is one of the core reasons for the BRI.
China considers Australia to be within its primary sphere of influence (a rapidly expanding sphere as far as China is concerned, as they push outward militarily).
Japan was willing to invade Indonesia, Malaysia, Papua New Guinea and Australia during its Empire days. China is a drastically more potent superpower than the Empire of Japan ever was and China's military reach will be far greater.
In an Asia war scenario (which is what we're talking about here), Australia is absolutely on the table to be invaded by China. It's a prime candidate if China's foes attempt an inevitable resource blockade (which would see the BRI targeted early on). Invading Australia also disables a critical, reliable ally for the US side. The US & Co. would need vast regional resource supplies to sustain for long at all in a conflict with China in Asia; China would know that, and would understand that Australia is one of the most important resource suppliers both regionally and globally. At a minimum China would seek to cripple Australia functionally, and an invasion is ideal toward that ultimately (otherwise the Australians would just keep rebuilding and repairing damage).
European empires would never seek to conquer territory in Asia, it's too far away. Britain would never seek to conquer India, it's too far away.
China sends its vast fishing fleets to illegally plunder South American fishing waters. It has blanketed much of Africa for resource extraction purposes. It certainly considers Australia as a resource target within its reach. And it's more than that, China had already fallen into the mindset of considering Australia to be increasingly within its sphere of influence and control, which is why the CCP has gotten so angry at Australia in the recent political-economic conflict between the two. They had plans for Australia and assumed they would be dictating terms going forward.
There is zero evidence that China is developing the capability of invading anyone except Taiwan for the next 25 years, and heaps of evidence to the contrary.
There is stupid and then there is literally physically impossible.
As far as Britain invading India, it's not like if they had just one day woke up and decided to do it. They built up the capability to invade colonies over literally centuries before being able to start the invasion around 1760. Meanwhile China didn't even start building that capability. They don't even plan to deploy stealth carrier craft, up until today their projects are for export only, nor blue water invasion craft, etc...
Anyways, it's almost impossible to invade Australia in 2021. Even the US would seriously struggle.
Australia is hard to invade because it's a separate continent, not solely because it would be protected by nuclear weapons. It's all the other normal stuff related to the challenge of conducting opposed landings over long distances that would make it very costly to attack. The nukes are a plus but they are not magical. All modern nations have tons of expendable population. It's politically convenient to present nukes as the ultimate deterrent but it's not backed by empirical evidence. The other issue is that due to test ban treaties we really do not know how currently existing stockpiles of such weapons will perform under real conditions. We could have vast stockpiles of antiquated garbage. We just don't know.
China is food-safe in calories. Not in dollars, because China produces less expensive food than they import.
While yes the raw materials are currently imported from Australia, in war-time they would be imported from Russia and Central Asia. Preparations are being made right now to facilitate this.
China is also #4 in iron ore reserves, they just aren't as economical as Australia's. Of course that doesn't matter much in wartime.
It would not take any special creativity (merely an act of will, which would certainly be present in wartime) for the US to scale its steel and other raw materials production incredibly quickly. Sure, there might be a lag time before all the new capacity comes online, but that would not be happening at SF housing approval rates, instead at Liberty Ship construction rates.
I agree that ad tech and social media are net negatives, but what are the alternatives? A dead economy, where most of the money circulates on necessities?
Not asking this sarcastically or rhetorically - genuinely want some good insight on what people who say the current direction of the US is poor think the direction should be.
Removal of free (costless) social media. Everyone who uses social media must pay for the employee and hardware costs by the minute. End of ads and end of engagement. End of push notifications. If people gain time by working 15 hours a week but lose the gained time on social media then no good is created. There is some value in Social Media but it must be consumed a little otherwise it is poison. Similar for Netflix and TV.
Once people are free of bullshit work and of bullshit free time (facebook and instagram feeds) and all boring physical work is automated, we should look to the stars. The final frontier.
That is my hopefully doable utopia. Actually this is John Maynard Keynes year 2000 utopia expanded a bit. Society failed as we are 2021 now and 996 is the norm instead of 15 hour work weeks. Working more is not the solution. Working smart is. Also not everyone needs to have a job.
But regardless, China's downfall will be the fact it tries and picks to "winners and losers". It's a semi-planned economy. Many other countries have tried this and I'm not saying that China will collapse or won't continue to be an economic power, but even the mighty power of the CCP won't make consumers buy their products from you if they aren't what consumers want.
I don't really see Netflix as being as much of a problem compared to other "attention" companies because they screwed with the media cartels, have fantastic infrastructure, mostly sell long-form content, and denormalized ad-breaks. Compare to YouTube or TikTok.
Arguably, capturing most of your country's top talent with absurd salaries and putting them to work on world-critical challenges like... how to generate more revenue from advertisement or... how to create as many "phone-addicts" as possible... could be quantified as producing tons and tons of negative value.
If China's crackdown on "consumer-facing tech" is about this, that could be a very good thing for China long term.
I grew up wanting to work on NASA and putting stuff on space, and during university got offered 10x the NASA salaries at FAANG companies, and was to week to just say "no thanks".
10 years later I am starting to wonder what my legacy is going to be.
Not sure why coding CRUD pays so much more than what robotics tends to. I guess there's more material costs, costs to get a company started and profitable could be higher.
- from Adam Roberts' sci-fi novel "Gradisil"
...but if we get Mars bases, so what? I'd rather play video games on earth than farm potatoes on Mars. Call it a lack of imagination but yeah.
Isn't this a major reason people start families? Having kids and people and things to take care of gives life a lot of meaning to many people. So much so that the vapid trivialities of the everyday modern life are mere amusements we gratefully accept rather than the daily struggle most people that ever lived before us had to endure.
And where is that happening? It's not happening in the US, China or Europe. The ad tech segment would be lucky to rank at the median on talent in the tech industry, much less the wider economy.
What you're referring to is a myth, a slander that gets thrown around HN freely because it makes for a great, vicious soundbite to stab (primarily) the US with. It always goes entirely unsupported, nobody dares to even try to support the claim (because it's obviously false and won't stand up to even light scrutiny).
The majority of the top US talent is working on ad tech? No, that's not actually happening. Not remotely close. The claim is off by far more than an order of magnitude. The best talent at Google are not even working on ad tech.
Pfizer, Merck, Amgen, Regeneron, Moderna, Biogen, Gilead, AbbVie, Abbott, Bristol-Myers, Eli Lilly, Illumina, Intuitive Surgical, Apple, Microsoft, Adobe, Nvidia, Intel, AMD, Texas Instruments, Cisco, Qualcomm, Micron, LAM, KLA, Applied Materials, SpaceX, Tesla, Caterpillar, Honeywell, DuPont, General Dynamics, Lockheed, Northrop, Boeing, 3M, Boston Scientific, Stryker, Edwards Lifesciences, Johnson & Johnson, Medtronic, Monsanto.
That's a super short list that instantly destroys the claim and doesn't include the vast brilliance at work in US universities (which also outweighs the entire US ad tech industry all by itself). It also excludes the huge number of foreign industrial firms in the US filled full of brilliant persons that are also not concerned with ad tech.
NASA has more elite minds in its employment than all of the US ad tech industry combined.
There are probably more top minds working on just CRISPR right now in the US than in the entire ad tech field. Which is to say, the position of the ad tech field is drastically overstated.
IBM is a debased giant, that has languished badly. And yet they have a top shelf quantum computing division. You think the best talent at IBM is working on ad tech? No.
TI or Cisco's best talent is all dedicated to ad tech? No.
The best engineering minds at Illinois Tool Works or John Deere, they're all working on ad tech? No.
All the smartest minds at LAM, KLA and Applied Materials are working on ad tech? No.
The great engineers at Nvidia, AMD, SpaceX or Caterpillar, they're all working on ad tech? Uh, no.
The insurance industry has more top talent than the ad tech industry. The property/casualty segment all by itself is dramatically larger than the entire ad tech field, including all dollars spent on digital advertising in the US.
Compensation != top talent. Otherwise all the smartest people in the world would be hedge fund managers and absolutely nobody would ever work for NASA or NSA. That's not actually how things work in reality.
In Germany, Google, Apple, Facebook and Amazon compete for CS, electrical, and mech eng students with BMW, Daimler, Audi, Airbus, etc.
These classical engineering companies can't compete with FAANG salaries here. The top of my class had offers from many of them, but they all ended up in FAANG, because the salaries were 2x what the others were offering, with larger room to grow.
> The best talent at Google are not even working on ad tech.
Improving web server performance, source control tools, etc. at, e.g., Facebook, is not "working on ad-tech" per se, but rather work on the infrastructure that supports ad tech.
Arguably, working on "traffic in Google maps" is not working on "ad tech", but rather working on adding value to an app so that it can serve more ads, etc.
> Pfizer, Merck, Amgen, Regeneron, Moderna, Biogen, Gilead, AbbVie, Abbott, Bristol-Myers, Eli Lilly, Illumina, Intuitive Surgical, Apple, Microsoft, Adobe, Nvidia, Intel, AMD, Texas Instruments, Cisco, Qualcomm, Micron, LAM, KLA, Applied Materials, SpaceX, Tesla, Caterpillar, Honeywell, DuPont, General Dynamics, Lockheed, Northrop, Boeing, 3M, Boston Scientific, Stryker, Edwards Lifesciences, Johnson & Johnson, Medtronic, Monsanto.
I work at FAANG. Many in my team are "aerospace engineer", "structural engineer", "civil engineer", "electrical engineer", "astrophysicist", "chemist", "mathematician", etc.. All top of their class, now doing CS, working "indirectly" on ad-tech.
That does not mean that the companies above fail to attract good engineers. But most people in my team, including myself, had to choose between working at any of the top firms for engineering in our "field", or going to FAANG to do CS and work (directly or indirectly) on ad tech.
One new hire recently was doubting between working here at FAANG or at SpaceX, and at the end, after being a bit burned out from their PhD, they decided they preferred to work at FAANG on ad-tech because: n-times more salary, for a fraction of the hours.
> That's a super short list that instantly destroys the claim
The claim is that normal companies can't compete with FAANG for top talent.
I don't see how the fact that normal engineering companies can find engineers debunks that claim.
There are many people who enjoy working in fast paced environments or building cutting edge experiences and products.
You could see the US brain drain top Chinese technical talent because the US has diversity of opportunity. There's Space X and Tesla, but also Uber and Google.
10 years at a FAANG take your money, quit
Study rocket science, photovoltaic cells.
Do something and do it now.
One country that, to some extent, successfully emulated the early Silicon Valley type strategy is Israel that has encouraged lot of personnel from defence and aerospace industry to form commercial ventures.
Not many countries understand this point; many go by the PR bling that is spewed by the USA internet companies(mostly pushed by get-rich-quick minded VCs) and try to encourage this type of non-essential startups in the hope of being "successful similar to Silicon Valley". The definition of successful is obviously is being set by these get-rich-quick VCs rather than the country itself. It is not surprising that you see lot of the VCs/Accelerators/Incubators fund me-too type companies in other geographies in the hope that they will be acquired by companies in the US! It is all bait-and-switch game and not meant to develop R&D and innovation that benefits societies at large. Benefits to the society, if at all there is one, is the by-product or after-thought of this whole process.
https://www.economist.com/schumpeter/2014/02/03/startup-myth...
https://www.wired.co.uk/article/mariana-mazzucato
https://www.imf.org/external/pubs/ft/fandd/2020/09/economics...
https://www.economist.com/briefing/2021/01/16/the-case-for-m...
This is a not true. Dictators do long speeches. Often quite explicitly stating why they do what they do.
Funnily sometimes in democracies there is a bigger space betweeen what is done and what is communicated.
The only logical way to interpret the intentions of political leaders is to look at their effects. Anything else, even personal diaries, are likely full of interested reasoning and outright lies.
You might describe it as a dictatorship, but it's more data-driven than you might suspect. The Chinese keep the pulse on decisions they make, and if it's unpopular - it's gone. Of course there is a line - you can't go head-on against the Party and call them out directly. Compare this situation here, where we are trying to patch up our infrastructure and instead have to deal with a collection of spectacular douches in Congress, propagandizing against science to such an extent that our top epidemiologist has to get a security detail.
Who would you bet on in this movie?
More serious response: I don’t want to live under a dictatorship where a generational change could lead to corruption and suffering on a much bigger scale. I think America as a project might also be lost and we should consider if this crazy idea (democracy, freedom of religion, free speech etc.) is worth fighting for. I think it is and I believe in the values that the US has, despite some very obvious mistakes America isn’t ethnic cleansing Muslims or having a press that can’t criticise the government. I will bet on America not because China won’t win but because I still believe the (relative) peace and prosperity of the post war period isn’t worth throwing away as easily as some want. We need someone focused on this in a clear way and to get Americans stop arguing amongst themselves and look at the bigger picture.
What I am saying is, given the decay of the western society, which is our fault entirely, our chances of staying ahead are slim.
The problem is, the Chinese have a team. They do not easily sell out. We, however, have an entire layer of high-level government that will readily go to the highest bidder. This is not sustainable. The only way to fix this is a crisis that unites us, but if a global pandemic did not do it, what will?
https://en.m.wikipedia.org/wiki/Casualties_of_the_Iraq_War
I think the testimony of so many Uyghur people about this and the huge “re-education” holiday camps you mentioned I’m not sure the West is fabricating such things. There’s simply too much evidence the other way.
Also, note that those numbers are only the direct victims. How many people died because of US sanctions?
As for Uyghurs - I’m sure there were a lot of horrible crimes there. It’s unavoidable when doing things at that scale, in a country which still has a long way to go about human rights. The propaganda part is 1. claiming this is a “genocide”, as in something deliberate, rather than crimes committed by individuals, and 2. claiming it’s somehow worse than the US solution to the same problem, which is killing those people on the spot.
You must not understand that Iraq was like North Korea before the war, I suggest you read Christopher Hitchens on this as he puts how dark and evil Saddam’s regime was into some light.
You’re arguing both ways in your comments by the way, you say on the one hand America is responsible for all deaths perpetuated even by others because it created the situation for it to happen but when confronted with evil by the Chinese state you make out that individuals did it and it wasn’t intentional by the CCP. I think you have to understand if you lock up 3 million people without trial you’re going to be running a completely unmanageable version of the Stanford prison experiment and cause horrendous unjust suffering. This wasn’t guaranteed in Iraq if we’d have understood the country had such serious internal divisions when we went it.
As for “both ways” - there is a fundamental difference between government sending people with an explicit mission of killing people - which is what US did in Iraq - and the government sending people to doing something else entirely, yet ending with some of the victims dead.
Let’s assume your numbers are right, and the number of incarcerated Uyghurs really is as high as the number of incarcerated Americans: is that genocide, in both cases? Would you say it would be better for those people to get killed instead?
I think you have a point with your use of "technocratic," but it is an oligarchy. The party is the olígos. Autocracy implies stuff like the army reports to the leader, not the party. I think things are trending that way, but I don't think it's historically accurate (at least for the last several decades).
Term limits are horrible for the working class in the U.S. Constant political turnover means groups like ALEC basically run our legislating process. Killing term limits for certain offices means that as someone gains experience and competence, they continue to lead, whereas in the U.S. they'd arbitrarily have to leave office right when they're getting the lay of the land.
It'd be like firing our senior dev and putting in a junior – no wonder shit never gets done in the States.
Paging California. Paging California. Which is now in the process of its second recall of a governor.
Seems a very odd thing to complain about 'neutered impeachment processes' in Western democracies whilst claiming he can be 'voted out at any time'. The US President can be impeached at any time too and removed from office. You claim impeachment is neutered presumably because the power has never successfully removed anyone from office. How then do you manage to praise the Chinese system for its ability to remove leaders. They don't have democratic recall either despite the theatre of voting, their President has never been removed and is essentially selected by his predecessor, the worst performing president at election captured more than 90% of the vote and even with the addition of state sanctioned 'independents' the leader still captures 99% of the vote.
Secondly, I'm not sure exactly why you say 'Western democracies' when you really just mean the US. Just because you're unhappy with the most recent impeachment failures doesn't mean other 'Western democracies' lack the ability to remove the ruling party or the leader.
Sure a "dictator" (more accurately "central power" for China) wants to consolidate power but to think the dictator is a one dimensional being and that all actions a dictator takes only serves that single minded motivation of power solidification is really not reasonable.
Consolidating power is only one aspect of their motivation that much is true. However the article is not about this aspect of the CCP. The actions taken by the regime here represent broad views about what constitutes economic health. The OPs comment is spot on, and captures the main point of the article.
The USSR fell because people didn't care about space exploration and Opera, they wanted washing machines and pop music.
> I don't think it's created anywhere near the amount of value that's come out of e.g. space race
The space race gave us a lot of tangible, physics/materials/hard-engineering related tech. Software gives us a lot of internet infrastructure, communications, algorithms, etc. that are incredibly useful for the average consumer. Lots of people in this thread complaining about the negative value of ads and such, but the communications infrastructure, knowledge sharing, social change due to marginalized people being able to communicate things far and wide ... there's a lot of intangible benefits that have come as a direct result of focusing heavily on consumer internet.
That’s like saying the Cook maybe fat and morbidly obese but look at how efficiently he consumes such a large number of calories every day.
This incentivizes said people to emigrate.
Clearly these sectors are powerful or they wouldn't be targeted. Whats the plan to make them obsolete beyond taking Chinese software down a peg?
The ridiculously expensive college education can't even prepare us for our own workforce, which has very little demand for engineering, sadly.
This is their way of reminding the tech sector of that latter part.
The article claims the actions taken by China also represent real philosophies about what constitutes economic health. They don't want their greatest minds optimizing ad tech or finding tax loop holes.
The article is about tech, but from a broader perspective letting the free market completely decide allocation of resources in all sectors of the economy is something China never completely bought into. After all it is technically a communist.
Think about it like this, China built the biggest high speed rail network in the world and doing such a thing wasn't just about "power" it was done because the regime cares about it's people. Centralized governments aren't automatically evil. Like all people in general, more likely a central power has complicated motivations that span across many dimensions. Power solidification is just one dimension.
Sort of a tangent but California can't even ring the shitty bart around the bay. Likely because not enough of the key people in critical places care.
The US built its massive interstate highway system for various reasons, including to enable more rapid movement of military assets in times; to enable rapid evacuation of cities in case of nuclear strikes; to promote better connectivity between major population centers; to enable white people to flee the cities; and to destroy prominent black neighborhoods. You'll note that by the latter elements, there is definitely a sense of punishing certain political outgroups that was sometimes pretty explicit in the designs. So did the US government care about its people or not?
I don't know how the micropolitics of China affected the location of right-of-way choices to help or punish local residents within urban areas, but there are definitely areas of China's internal planning that are rather explicitly designed to punish political outgroups, such as encouraging Han migration to dilute the indigenous populations of Tibet and Xinjiang. And of course there's the Hukou system, designed to prevent rural people from moving to cities.
> Sort of a tangent but California can't even ring the shitty bart around the bay. Likely because not enough of the key people in critical places care.
The US planning process has a notorious effect in that it makes it very easy for local activists to block projects (NIMBY--Not In My Back Yard). This was adopted partly in response to projects like the Cross-Bronx Expressway that actively destroyed the local neighborhoods for the benefits of people who lived elsewhere.
Is being responsive to the people who are going to bear the brunt of your development really a sign that you don't care about your people?
It exists fundamentally to reduce rent-seeking, which is why it exists in some form or another in every economy where there is strong government control of housing. If you remove the Hukou system, everyone will flood to the cities, and you will have overpopulation. You can also liberalize housing, in which case people will pay around 30% of their income in rent which the CCP think is not economically productive. This happened in Beijing and Xi has been floating the idea of literally building another city and moving industries there to reduce rental pressures.
Or you limit migration into the cities to the speed of new constructions, which enables you to set a low rent and, according to the CCP, have better economic outcomes. You limit migration by disincentivizing people who move to the cities without following the quota, hence the Hukou system.
As far as incentivizing Han migration, I can't speak to recent efforts, but for a long time Han migration was incentivized because, well, there weren't much people in Xinjiang and there were a lot of resources and a border with the now-hostile USSR that needed to be exploited. So the CCP under Mao did everything they could to get as many people into Xinjiang. That included allowing Uyghurs to have 3 times as many children as the Han. But otherwise if you need more people into Xinjiang they're not going to be Uyghurs because, well, they're already in Xinjiang.
I would think this is a smart move to not fall into this trap we have and kills two birds with one stone as far as a powerful rivals go.
"And so, in classic CCP fashion, it was time to smash."
It's your standard state propaganda.
At least he attempts to cover his bases: "China’s leaders famously want to prevent the emergence of alternative centers of power, but is the West so different in this regard?"
"For those outside China’s byzantine, opaque nexus of party, government, and big business, it’s very difficult to figure out what’s going on." I guess Noah Smith is in the inside so he knows his stuff?
It's your standard "CCP bad because CCP is friends with iran due to BRI" propaganda you find all over traditional and social media.
The real question is who is noah smith and why was his article spammed on hn? That would be an interesting article.
It's hard to argue that shlepping stuff around efficiently isn't "economic health".
As much as I hate Amazon and WalMart for being predatory, I applaud their logistics advances.
China is doing what the U.S. would normally do in an effective anti-monopoly action, if our system was not broken and the government not bought with its guts by billionaires floating in tax-cut windfall.
Now we have entities that have more legal resources than the government, which is a recipe for disaster (and runaway legalized corruption).
China sees what happens when you let money run loose through power structures, and it does not want the same fate.
I strongly disagree. The US was not able to win the Vietnam war with 100x the amount of military stuff. Stuxnet halted Iranian nuclear research. US elections were interfered with by foreign hackers. Microsoft’s revenue is >$100B a year, and it’s mostly software driven.
Information, data, data-analysis, networking and intelligence is where power comes from.
And then what? If we think future wars will be won by hackers in hoodies, it's our funeral. An out-of-control hacking war will have to escalate to bare metal war. People will want to see explosions on TV, as they lose power and are unable to gas up their cars.
One of the examples I've seen over here, which I can't seem to find in English, was an infographic created by Didi. Either stupidly or some tech dick-waving contest, they made a chart of the most hard working government agencies in Beijing. They had all this work habit data and they released it as a fun little thing.
Suffice it to say, it's hard to find now and a smaller part of a overarching data issue that has gone out of the government's hands.
Totalitarians are gonna totalitarian, but now they've learned to do it effectively and use the terminology the free world does to make it sound righteous.
Meanwhile the Chinese were exploiting the West's myopic focus on quarterly profits to gain access to and experience in fabricating and designing the top western technology.
The scale of this strategic blunder by the Western societies will be considered of historic importance.
The analysis in this article brings that into focus as well as anything I've yet seen. If the West does not rapidly regain focus on the things that matter -- real manufacturing, engineering, and AI (not consumerist opiates for the masses) -- we are soooo screwed.
It is exactly the myopic financialist's approach. It works great for a while, juicing artificial growth. Meanwhile it starves the real growth engines, so when it stops working, there is no hope of recovery before failure (but the finance wizards have by then moved on).
Normally this applies at the scale of companies, but here it applies on the scale of nations or societies.
Ignore at our peril.
This is a system of private funding that generates maximum profits within a 5-10 year horizon while China and its public funding and actions is focusing on generating foundational returns and innovation that will last well beyond that 10 year horizon. The US approach of subsidies for loss leaders and laissez faire when it comes to regulation is kicking the can and optimized to pump out millionares/billionaires that can provide outsized returns to people in the market (employees/founders/congress/entrepreneurs) but less for people on the sideline.
When China can build a decent airplane then I'll be interested. Until then, they produce/replicate relatively simple tech and for whatever massive scale they have in their manufacturing, they lack sophistication and complexity in many ways. They're doing their thing and doing it well but they don't produce sophisticated, leading edge things or processes for the most part.
The USA has never manufactured more than it does today. Don't confuse manufacturing labor force size with outputs. High tech manufacturing in the USA leads the world by a significant margin today. Much of what China is manufacturing is considered routine and trivial.
But, China is advancing, making some genuine homegrown breakthroughs and is certainly much further along the learning curve than the West in many areas such as solar panels.
Mostly, it is key to note that China recognizes this, has a long term strategic plan and is executing on the plan.
Unless we make appropriate structural & strategic changes, at the very least, treating a far wider swath of tech as sufficiently strategic to require development & production at home or among allied countries, we are on a slippery slope.
Edit: Plus, by the time we see them making stuff as good or better than in the West, it will be too late to catch up. Those growth curves tend to be exponential (compound interest on knowledge gains, network effects of multiple experts or multipl6field leadership, etc.).
China's big, customer-facing "tech industry" (I agree with that part of the argument) lives in the same environment as that of the rest of the world, with the same ability to generate the same large profits. Those large profits provide a power base that threatens the party, which in turn uses its governmental power to smack down anything threatening.
I genuinely hope that America makes a similar shift in it's own VC sector.
I am surprised that those who continue to work on "genuinely hard technical problems" do so when web app/dev has so many jobs with pretty damn good pay.
As an anecdote, my wife has a PhD in chemistry from a top program. Majority of her peers in grad school ended up taking classes in CS, Data Science, drop their program and work at a tech company.
When she graduated...I remember sitting with her at a career website and just looking at the differences in quantity of jobs for hard sciences vs IT (my wife's career now has nothing w/ her hard earned degree)
And even if the consumer internet problems are technically challenging, like problems of scale for Facebook, you can argue pretty easily that solving them to increase Facebook's power and profitability is a net negative for society.
For China to simply say "no" to that and invest more heavily in the physical economy is... a smart move, by my estimation. It tracks with what I'd do in my "king for a day" fantasy. Not that I think they're out there building a utopia - they're still a repressive regime - but they're wisely avoiding a class of problems that the West has jumped into headfirst.
He spoke out against and essentially insulted the government in a speech last year, and immediately disappeared from the limelight. [0]
[0] https://entrepreneurshandbook.co/the-speech-that-cost-jack-m...
I personally suspect that China wanted to get a jump on the effort and in turn force U.S. pension & hedge funds to lose $400B.
https://www.wsj.com/articles/investors-rethink-china-bets-af...
That's a huge amount of money and will dramatically and negatively impact the public pension funds.
It's not about the tech, it's about the economic war between China and the United States. At the same time, the CCP is exerting it's authority over these companies to tighten it's control.
Love this. It's like Obama's "the bubble sort would be the wrong way to go". Clearly Mr Smith has done his homework on the subject of military technology and has learned a Technical Fact: "firmware exists". He probably even knows that it goes between hardware and software!
So much of the work done at Google and Facebook seems to be solving general computing problems. That's how we got things like React and k8s that aren't specific to advertisements at all. On top we constantly complain about app the projects cancelled by Google. All these projects were build by someone and rarely are directly related to serving advertisements. Not to mention all the very valuable products provided by Google many of us use every day that provide tremendous value despite Google's ultimate goal of serving ads. Gmail, Maps, Docs, Calendar, YouTube, Google Voice and probably many more. Not to mention products we ridicule for their unnecessary changes and internal competitors like Meet/Hangouts. Pie on the sky stuff like self driving cars. AI advancements like Tensor flow. They have a leading security project that slowed down all out CPUs ;)
What percentage of work at Google is in fact directly "wasted" on advertisements?
Maybe the point here is that the government in china wants to always be between the consumer and the service, which makes a lot more sense. Maybe Alibaba and the like have a connection to every person and the gov'ment is threatened by that relationship.
There are many possibilities but I don't necessarily agree with the conclusion of the author: that to grow their hard-tech industry, they have to punish consumer tech.
I can't understand this sentence haha ... Too many "nots"
> I don't necessarily agree with the conclusion of the author: that to grow their hard-tech industry, they have to punish consumer tech.
I don't think the author is trying to argue that this strategy is true -- I think they're just trying to explain China's behavior.
I'd actually argue with the idea that China is doing this intentionally. Maybe it's not due to the centralized planning that tech sector gets smashed - maybe it's a much simpler reason behind that.
It's unlikely, but in their position it's what I would want to do.
Given Internet companies are ubiquitous, we sort of equate tech firms to them...
Under the CCP, the "rights" pendulum swings wildly for society and the economy, alternating between openness and crackdowns. Some policies seem well thought out, and then you have edicts which seem impulsive and extreme with little regard to long-term consequences or the impact on China's people.
100 flowers/Great Leap Forward.
Cultural Revolution/Deng reforms.
Tiananmen/hypernationalism.
Tech has enjoyed a relatively open hand for two decades. Now the fist is closed and comes smashing down.
Bet it's the same reason they took HK early.
https://www.asiafinancial.com/china-seen-ushering-in-new-era...
Because cyberspace is ascendant over the old powers. Alas, sure, it's a pretty sad capitalist shell of what cyberspace could be, but it's still striding past the encumbered old giants.
The optimism turned out to be naive? I mean, regardless of whatever "cyberspace" was originally imagined to be, in actuality it turned out to be bunch of Facebooks. And more often than not it's allowed low-quality garbage to be spread with unprecedented effectiveness.
Or to summarize in 1996 terminology: cyberspace turned out to be land of timecubes.
I'm not convinced that previous systems of more centralized distribution of information (television networks and woodblock printing) were better than the ones that succeeded it.
I'd dispute that, after making one clarification to my original comment: I meant "unprecedented relative effectiveness." At no other time has any rando with a batshit insane idea been able to spread it with near equal access to same the tools people use to spread real knowledge and understanding. To contrast it with the previous system, it's like hiring a bunch of incompetents and then getting rid of code review.
The race to the bottom, adtech, consumerist takeover only started when the "stupid" society at large became the majority, so for the west this process was really inevitable. China, being a dictatorship on top of a closed-feedback system and unwilling to let capitalism run unrestricted, has a much better chance of controlling the process and using it to shape society according to a central vision. We should be worried.
in the aughs Tim O'Reilly was talking about chasing the alpha geeks. by contrast we seem fixated on the muck & mire of the lowest experiences, these days, and we have few visible free radicals pushing the ascent. I believe the former to be not worthy of fixation, and the latter to be imminently close to rediscovering themselves, & they will be equipped with vastly better means to pioneer onward with.
What will be the web once we move to a new 3D / AR media or a metaverse platform? What id the internet become distributed again (I see some seed in blockchain / DAO), or if connectivity become ubiquitous (think smart dust).
We are just at the beginning of this journey, and the GAFAM of today are the IBM of tomorrow.
I also remember feeling that optimistic about technology. It wasn’t until this past year, I am getting an inkling of what happened. It’s a continuation of much longer trends that I didn’t see until I started studying Carol Sanford’s work on regenerative paradigms, responsible business, etc.
The dominant worldview these days is that of the machine world view. It sees the world as complex machinery, with people as cogs. It denies the power of living systems to be able to live and grow on their own, instead, forcing them to intermediate through the machine.
As such, software eating the world is a continuation of that worldview.
I think perhaps, this is the “punk” in cyberpunk; that even though people become part of the machine, they can still change the world for the better against old powers. Old powers didn’t understand how the emerging technology works, so there’s a window of time. Perhaps, that, technologists will maintain a tech gap over old powers. But the old powers had been eaten by machines a long time ago, and when new tech companies arose, that machine world view became further entrenched.
It didn’t solve for the fundamental problem: living systems are not machines. We are capable of growing and changing on our own. We are not consumers. We are not users. Living systems are what makes software come alive; why would we want software to eat us?
There never was and can never be a cyberspace independent of the physical world. All there was was a brief moment of being ignored until the powers that be realized "Oh, hmm, looks like that Internet thingamajig is kind of important now; better start ruling it."
China is focused on building an industrial base that complements its military power while generating cash, and internet software startups aren't going to help.
For the rest of Asia, they'd do well to militarize; for Japan and Australia to consider getting nuclear weapons or hosting them, and for India to rapidly increase stockpiles.
Globalization of all economies means everybody loses in a war. The devastation will harm everyone in a significant way.
The most likely outcome is just perpetual political squabbling and the continuous feeling that war is omnipresent but realistically will never occur.
China likely plans to dominate the US from a prestige standpoint. Better GDP, higher technology, that kind of thing and they already have the momentum for it.
From my armchair, I can't see a benefit to China for kicking off a superpower war; they're already pulling ahead in STEM, their economy is fairly safe and not really that dependant on exports, quality of life is improving massively, infra is improving.. ?
Xi is of course not going to risk a war that he won't win easily. So there's enough time for the rest of the world to reverse the wholesale shift of industrial capacity into China.
Taiwan had nuclear program in the 70s which would have prevented war and invasion. That was nipped under pressure from everyone else, so I imho defending a democratic nation must be a shared responsibility.
The idea that we'd ever let Japan have a nuke is ludicrous. Do you really think we'd let a country we nuked twice have such weapons? There is a reason why we are still occupying Japan 75+ years after ww2. And no, it isn't to "protect" japan.
> and for India to rapidly increase stockpiles.
I don't think china would mind one bit. After all, it wasn't china that sanctioned india when they developed nukes...
http://edition.cnn.com/WORLD/asiapcf/9805/13/india.us/
If there is a war in asia, it will be a war for liberation - not from china, but from the west. It's so funny how we truly deluded ourselves into thinking we are the good guys in asia and not the murderous colonial powers that we truly are. We really need to start seeing the world as it is rather than the disneyfied nonsense you read on "news". Or we are in for a rude awakening.
Not ludicrous at all - Trump was open to Japan and Korea acquiring nukes. [1]
> After all, it wasn't china that sanctioned india when they developed nukes...
That was at a time when India's wasn't clearly aligned to the US. Subsequently it was the US which drafted the Nuclear Suppliers Group (NSG) exemption for India.
> If there is a war in asia, it will be a war for liberation - not from china, but from the west.
What liberation? People hold favorable views of the West (compared to China) in East Asia, South East Asia, or India. Many of them are now in disputes with China, which often involve violence. The situation is different in West Asia - but it's always been that way.
> It's so funny how we truly deluded ourselves into thinking we are the good guys in asia and not the murderous colonial powers that we truly are.
Modern western influence is largely positive compared to the alternatives.
1: https://www.ft.com/content/c927017c-f398-11e5-9afe-dd2472ea2...
Don't link to paywalls. Who is talking about Trump? I'm talking about the US. Also, Trump was open to a lot of things. Including Mexico paying for the wall.
> That was at a time when India's wasn't clearly aligned to the US. Subsequently it was the US which drafted the Nuclear Suppliers Group (NSG) exemption for India.
Countries like india, china, russia are never "clearly aligned" with anyone. They are too big for that.
> What liberation? People hold favorable views of the West (compared to China) in East Asia, South East Asia, or India.
That's because we are the dominant occupying power with dominant propaganda and wealth. The leaders of these "subjugated" nations could easily turn the propaganda against the US. Look how quickly our propaganda was able to turn the sentiment against china. How easily do you think Japan, Korea, Philippines, etc could turn their nations sentiment against the US.
> Many of them are now in disputes with China, which often involve violence.
What disputes, violence? The only real dispute seems to be with the US and the west ( aka china's and asia's former european colonizers ). That's another danger, that asians, africans, etc are going to pick up on.
> The situation is different in West Asia - but it's always been that way.
What violence? Is it china that invaded afghanistan, iraq and sanctioned iran?
> Modern western influence is largely positive compared to the alternatives.
No. It hasn't been. Not for the aborigines. Not for the natives. Not for the africans. Not for the indians. Etc. That's the point. It's actually modern chinese influence has even been more positive. Considering the wealth of japan, korea and much of asia has been due to trade with china. And that's why we are "pivoting to asia" - a place we do not belong. A place, btw, we caused the deaths of tens of millions of innocent people.
But we shall see how history pans out.
The people of Japan and the US have very favorable opinions of each other[1]. Of the two, Japan has more favorable views of the USA than the other way around.
The US would love to station nukes in Japan, but this would cross a red line for China.
https://www.pewresearch.org/global/2015/04/07/americans-japa...
https://www.pewresearch.org/global/2016/09/13/hostile-neighb...
Be a good boy and stay a good boy and you shall be rewarded, at least domestically. This doesn't foster international success so easily but that's another story.