Vietnam to make Apple Watch and MacBook
asia.nikkei.com
asia.nikkei.com
And do they have the surrounding parts + engineering ecosystems that is so touted as why China is the place to get things built?
They're building a massive fab in Phoenix.
Once the factories are built, would US be as invested in defending Taiwan and further, South Korea? I know US won’t give them up easily, but when push comes to shove … I don’t know.
Ctrl+F 157 from PRC, other countries rarely break 30.
Vietnam has 21 suppliers, most of whom also has (likely primary) PRC operation.
>engineering ecosystems
One presumes still need PRC to to build things first and work out kinks - so far only matured manufacturing lines are shifting out of PRC.
What you mentioned is true, the absolute majority of the supply chain of the big name companies are still in China, and many of the alternatives in Vietnam are somehow managed by PRC background capital.
However, it’s absolutely a good start. The eco mic crisis raising in China will be like the 1930s in US, if not worse. My family are actively searching for ways to selling out everything and move out the country but it’s clearly prohibited by the Gov. We are worrying it will eventually becomes a new Third Reich in near future, when the supply chain will be completely destroyed.
Depends on why you think it's good. If you think it will hollow out PRC industry and will lead to collapse of CCP into Third Reich leading to collapse them you will probably be disapointed. CCP _wants_ PRC companies to expand in region because it's "cooperative" sourcing strategy that helps PRC geoeconomic posture by increasing dependence. Especially in Vietnam where PRC control over Mekong = influence over Vietnamese agriculture and energy via Laos hydogeneration upstream. The TLDR PRC moved into Vietnam long before tariffs, and while tariff dodging is nice perk, it's mostly another layer of influence/control over Vietnam.
> supply chain will be completely destroyed. ... > clearly prohibited by the Gov
Ergo why PRC supply chains won't be destroyed because apart from getting rid of polluting light industries where value:externalities do not compute, most relevant strategic supply chains will be protected in PRC for domestic use. I have family / friends who run factories as well, the ones in lowend got fucked whereas the ones higher up supply chain are doing fine. Those levers introduced last few years to prevent capital flight is why PRC is managing the eco crisis fine... a crisis by the way they chose to initiate (i.e. real estate) like past deleveraging efforts specifically because they have more lever to prevent actual crisis. But yeah people don't like the wild rides coming would be wise to look for excape plan, but it's going to be harder and harder to escape with much. Lots of people going to be fucked, while lots will continue to get rich, which is to say, same old China since the 90s.
Does the Zero Covid policy or the power crisis (because of China stopping the import of coal from Australia) has anything to do with it.
* Xi Jinping's increasingly tight and authoritarian control
* the upcoming demographic crisis in China: 1. its population will start shrinking (earlier and faster than assumed until recently), 2. the dependency ratio (proportion of non-working age population to working age population) will go up massively, 3. due to the demographic development (inverted pyramid), selective abortion and increasing women's liberation, the imbalance in the "marriage market" will get massively worse (150+ men per 100 women).
May I ask is this in mainland china? I'm a bit surprised because we usually don't think like this. Most older generations (50s-60s) from the mainland would not consider migration unless they are from extremely previledged background with huge assets (still very unlikely, at least in mainland). Also I doubt any mainland chinese person would be familiar with the concept of the great depression and the third reich.
Things like the great depression were covered in school. These make excellent examples of the "evils of capitalism" and how a communist government would protect you from these "evils".
You then look at rest of non-Chinese owned companies, how many of those are completely dependent on Chinese customers ( If 60%+ of your revenue are from China ) or dependant on Apple ( given this is an Apple Supplier list ) where Apple has a tendency, habit or even a strategic mindset to help Chinese companies into their supply chain as part of its diversification, or cost reduction.
And if people ( as few on HN are already doing ) continue to think Apple relying on Taiwanese company called Foxconn. You may want to do a search on Luxshare or more commonly known as ICT. And see how it started and Tim Cook’s opinion on it. Dating back to 2016.
If their process is essentially copied from TSMC, can they keep up with R&D though? China is becoming an increasingly less desirable place to live, so just poaching Samsung and TSMC engineers and copying the process might be increasingly difficult. And I doubt they'll be able to build the tight relationship with machine designers/manufacturers like ASML that TSMC has.
Overall, the permitted activities on your business license matter. Getting licensed is usually easier than people think, except a handful of sensitive areas.
A small slice of life: this does make furniture tradeshows sad affairs. You can see great things made in Vietnam, but you can't actually buy any of them. This has improved a lot over the last 10 years, but it's still somewhat of a thing.
* tens of billions of dollars
* at least 5 years of time
* most of all: immense effort and focus that could be used elsewhere
They can easily afford 1/10th of that to build a fab that's ready in five years right here in the US if they wanted to. (Las Vegas is ideal, no natural disasters of any kind.)
Hell, they could write a check and buy Intel outright.
[0] https://arstechnica.com/gadgets/2021/12/report-apple-ceo-tim...
https://www.ktnv.com/news/u-s-department-of-interior-declare...
There is the often quoted statistic that Las Vegas gets 90% of its water from Lake Mead/Colorado River. But Las Vegas reclaims and recycles 99% of consumed water and pumps it back into the lake via the Lake Mead Wash.
Because they get 99 return-flow credits for every 100 gallons, any draw limits from the watershed will have minimal impact.
Las Vegas also has a large groundwater table that supplies 25% of its peak summer demand.
As a last resort, the Casinos will never let the city run dry. While they only consume 6-7% of the cities water, they depend on their employees being able to live in the city to keep operating.
They don't own their own factories because that is not their expertise, and they probably don't want to bring that in house.
Considering that their entire product line collapses without semiconductors, it wouldn’t be a poor investment.
That being said; the other commenter is right. If Apple had to release the M1 on 10nm or even 7nm, they would end up sacrificing at least >200% performance-per-watt; a death blow to either the battery life or performance. Apple's move to dominate the 5nm supply was another demonstration of their manipulation of supply chains akin to their iPod hard drives. There are indeed interesting parts of Apple Silicon, but the performance is driven wholly by their exclusive 5nm ARM cores.
Developer transition kit, running A12z, 7nm:
https://browser.geekbench.com/v5/cpu/search?q=eperm-d995af6e...
Last-gen Mac Mini, running i7-8700B, 14nm:
https://browser.geekbench.com/macs/mac-mini-late-2018
So, let's do some quick math. Assuming the A12z runs in the same power envelope as the M1, it uses roughly half the power of the preceding Intel chip. That makes sense, since both the performance and efficiency cores are using a much denser process. Generously speaking, both of these chips have a similar performance profile, which leads me to believe that Apple's real 'boon' here was simply switching to a denser node. Comparing IPC across ISAs is largely guesswork, but I'm not convinced that AMD or Intel are incapable of manufacturing 5nm chips that decimate Apple's offerings. Apple hasn't allowed it to happen, so we can't say for sure.
We’re talking here about what is unequivocally the most complex manufactured goods in the world. You can’t just boil it down to one thing. Apple made so many decisions that lead them to their extraordinary performance, including financial ones. They heavily paid TSMC for priority access to their new node.
And once again, the gains are nowhere near 200%, your initial claim that is patently wrong and that you refuse to acknowledge as a mistake on your part.
Apple's chips are fast because they have lots of money. If you disagree with that, then you're no different than the kid at Disney Land who thinks Splash Mountain got built because some genius invented it. We can fight about exact figures until the sun sets, but I think my approximation was fair.
https://asiatimes.com/2022/06/tsmcs-new-us-fab-sparks-debate...
Makes sense to move manufacturing capabilities there, they are a step ahead. Perhaps it will result in vulnerabilities being closed.
TBH its likely that it was a question of when not if this would happen. Will be interesting to see the geopolitical effects of a diversification of manufacturing capabilities. CCP wouldn’t be able to sustain the current export focused model.
China is going down on its own behest.
The US foreign politics is the main evil in the world and the EU is still following the Americans. It is incredible.
We must get rid of all American influence in Europe, ban US tech, ban US military, get rid of the US propaganda, brands, social media.
In a way, this is a proxy war - against China, at Russia. Western response means Russia has no future with the West and has to pivot to China. This would give China advantage, so I think it’s unlikely for US to preserve Russia in a shape that could be useful to China as an ally.
In what way is it not a black and white war of aggression?.
"Look what your new friends made me do to you!"
"Now lie still while I rape you"
Right now it is more of a economic war by EU with Russia. But triggered and forced by Russia. It is beyond real how badly Russia prepped this war, Russia doesnt even know what is the end goal. |
Go back to 20 of Feb 4 days before invasion and tell me WHAT IS THE REAL GOAL on Russian side ? IT feels like pre WW1 e-peen lets make a war because of "reasons" without any real goal.... but even at that time they had more realistic casus belli and any goal.
I'm sure Russia would love this. Fortunately the rest of the world is sane enough to see this war for what it is and not fall for what the Russians want the world to think it is about.
If anything this war will lead to more US basses in the EU not less.
If it had been a non-chinese company, it would have been a great move. Western companies will need to reduce their reliance on China in their supply chains.
I thought I knew where Xinjiang was until CNN told me it was in Guangdong province.
https://www.reddit.com/r/Sino/comments/pjsyyv/cnn_once_chang...
Nowadays I'm not sure anymore, so I tend to add "/s" in all but most obvious cases, like this one.
Rather than take my word for it, though, I encourage you to do some research on your own - preferably not entirely through Internet sources. In particular, the current issue of the World Affairs journal (volume 185, issue 3) has several relevant articles.
Under the Bush administration, rendered persons were reported to have undergone torture by receiving countries. Journalists, civil and constitutional rights groups, and former detainees have alleged that this occurred with the knowledge or cooperation of the administrations of the United States and the United Kingdom."
https://en.m.wikipedia.org/wiki/Extraordinary_rendition#:~:t....
"A Wedding That Became a Funeral US Drone Attack on Marriage Procession in Yemen"
https://www.hrw.org/report/2014/02/19/wedding-became-funeral...
"5th April 2010 10:44 EST WikiLeaks has released a classified US military video depicting the indiscriminate slaying of over a dozen people in the Iraqi suburb of New Baghdad -- including two Reuters news staff."
https://collateralmurder.wikileaks.org/
Plenty more where those came from, also enough to fill quite a few books.
This discussion is _not about the United States._ This discussion is about _China._
Let me give you a helpful link: https://en.wikipedia.org/wiki/Whataboutism
People keep making China out like they some kind of benevolent dictator. Keep in mind that all the shit talking everyone does on Hacker News and other sites is a no go in China. Ask Jack Ma about how well things go when you go against the China's CCP.
Playing Yoda clever doesn't you make.
https://www.theguardian.com/commentisfree/2015/apr/09/prison...
>concentration camps used to "re-educate" Falun Gong practitioners
https://uk.news.yahoo.com/survivors-troubled-teen-industry-s...
Although tbh the American way to "re-educate" religious fundamentalists usually means executing them from a safe distance.
It _appears_ that China is worse, but once you start looking at actual data instead of the rhetoric found in media, you'll quickly find that it simply doesn't check out.
So once again, how is China hostile, while the country that’s provably worse offender isn’t? Other than racism of course.
U2/SR71 spyplanes overflying other countries. This alone is considered "an act of war". what would the US do if someone flew over their country on spy missions?
Then there is the absolute rampant lying about things.
U2 is shot down, US president is told that should this happen the pilot wont survive. Surprise, Gary Powers is alive and the USSR exposes the US lies to the world.
"weather aircraft drifted off course" indeed.
Ron Reagan and his "Evil Empire" speech. USSR shoots down a commercial flight and Ron leverages this to the max.
US shoots down a commercial aircraft, refuses to accept responsibility and eventually caves under international pressure, offering peanuts in compensation?
You can somewhat see what took place with the USSR's issue. The US was flying spy missions right at their doorstep. They felt this was another spy plane and shot it down.
Why exactly did a US warship go into another countries waters and shoot down a commercial aircraft?
The "puppet governments" and overthrowing democratically elected governments alone could fill several books.
Lastly, Iran/Contra. Lets deal drugs and guns??
Yes, the USA is an aggressive and imperialist power with more than a few atrocities to its name.
However, this is not "how bad is China relative to the United States," but rather "how bad is China on an absolute scale."
that's a very odd metric, because in absolute the entire human civilization is bad right now. for itself and other living beings on the planet.
But you do point to an interesting problem and that is one of humans’ impact to earth (and hence our habitat). Whether humans can adjust course without a single government coming up with rules and regulations remains to be seen.
At least China represent 1/4 of global population and resemble a global government more than all western countries combined, including their power of influence over large scale events,like climate change.
If they bail out from climate talks and zero emission plans over, say, interference on the Taiwan issue, is it bad or good?
What is the best solution globally, pissing off China or human survival?
It's something we should ask ourselves, I think.
True, 20+ years ago. Today: Spy satellites that can hide and re-position on-command. "Spy planes" are mostly Tom Clancy'esque fiction these days, at least from the perspective of over-head visual light photography. (Radio signals monitoring is a different segment.)
Then you wrote: <<This alone is considered "an act of war".>>
False. There is no single, absolute defintion. In my experience, the Internet is "full of" posts like this one. Words and deeds are two very different things in the Real-Politik World View. Ultimately, no words matter until the "first shot is fired". See China's recent behaviour around Taiwan. Still, not a single shot fired, but a lot of potty/bully talk. (BTW -- I highly recommend China's PR mouthpiece "Global Times" as a parallel equivalent of "The Onion", vis-a-via US-China relations. Their English is but one step above Kim Jong-Un/NK media.)
Finally, you wrote: <<what would the US do if someone flew over their country on spy missions?">>
In the current context, the US military will probably trap the spy plane mid-air (surround with fighter jets) and force them to land in US (or US-friendly) territory. The pilot(s) would be captured as enemy combatants, similar to other spy planes downed over enemy territory over the last 75+ years. FYI: China did this in 2001. See: https://en.wikipedia.org/wiki/Hainan_Island_incident
As a thought experiment (and I do think this will happen one day): What if China parks an aircraft carrier "one meter" outside US territorial waters (East or West coast), then runs constant military exercises, 24x7, for months and months? Think more brazen: What if Chinese military jets were speed-running over Midtown Manhattan during day light hours "daring" the US military to escalate? It can, and will, happen in our lifetime. Maybe London/Tokyo/Sydney too.
Which is exactly what US is doing with its stone aircraft carrier group Taiwan.
> What if Chinese military jets were speed-running over Manhattan
You’re assuming China is like US, in that it’s waiting for opportunity to invade. But the history shows the exact opposite.
What’s more plausible is American jets over Beijing. Hopefully China has enough nukes to prevent it.
Suggest you read the US governments OWN PUBLICATIONS
https://history.state.gov/milestones/1953-1960/u2-incident
"It was important that the overflights be undetected, because normally an unauthorized invasion of another country’s airspace was considered an act of war. "
"False" indeed.
that's not hostility towards the west, that's simply China defending their interests, which is their prerogative.
Taiwan is still formally and technically part of greater China, human rights violations are not rare in (an by) the US military and non military personel, do you consider Ukrainian soldiers training in the UK [1] as the UK being hostile towards China?
[1] https://www.nytimes.com/2022/08/16/world/europe/ukraine-mili...
we like to think that everything we do is virtuos, but it's actually not true.
We defend our interests, they defend theirs.
Fun fact: the number of American components in Russian weapons is order of magnitude higher than the number of Chinese components: https://static.rusi.org/RUSI-Silicon-Lifeline-final-updated-...
So, I'm not sure which one is more hostile to Russia - in deeds, not words.
The United States' military presence in the region disagrees with your second sentence.
Russias man power has been so degraded they had to resort to recruiting people from prisons and forced conscription of Ukrainians in Luhansk and Donbas.
Russias heavy armour has been destroyed so badly that we are seeing T62s rolled out to the front lines. These T62s are so old they don’t even use the 3 man setup that all more modern Russian takes do because they don’t have a autoloader.
Russia is also incapable of protecting territory it has captured. The occupied territories of Ukraine regularly have car bombs and ammo depots explode, Crimea even has Russian air bases spontaneously exploding so much all Russian tourists fled back to Russia.
This really isn’t an answer to any of my points, it would be great if you could respond to the substance of the message instead of attempting to attack the person who sent it.
But if you want to think that being into month 6 of a 3 day war is going great I guess that’s up to you.
Nevertheless, here is an old article from back in April to get you started - https://www.thepostil.com/the-military-situation-in-the-ukra...
https://dailysceptic.org/archive/how-accurate-is-jacques-bau...
It’s also interesting that article as far as I can see does not at all cover the current wars losses, all it seems to do is repeat a bunch of Russian propaganda.
It’s always funny to see Russia trying to involve NATO countries in this war in there propaganda, because it’s okay to lose to NATo where as it’s kinda pathetic for Russia to lose to Ukraine.
Well they are all more truthful then the Russian media who believes that Ukraine has genetically modified super soldiers and black magic battalions.
To be fair it doesn’t matter because your source doesn’t even cover anything I said it just tries very hard to justify the genocide of Ukrainians.
I was talking about the Russian armed forces performance in the war not about if it was justified or not(which it isn’t).
As I said, the education system in the West really needs a revamp. I just gave one example and already knew that you are going to post that one link as a retort (which does not provide any counter arguments to the points made by Jacques Baud at all). Hope your heroes from Azov were "evacuated" safely, as reported by the Western press. Honestly, I find it hard to believe that people can trust the Western press after the absolute nonsense they have reported so far and continue doing.
Your article didn’t address any of the points I made all it tries to do is justify the genocide of Ukrainians.
> Hope your heroes from Azov were "evacuated" safely,
I’d feel safer as a azov member then as a propagandist in Moscow right now.
> I find it hard to believe that people can trust the Western press after the absolute nonsense they have reported so far and continue doing.
I mean your telling me the press that said
“Russia will not invade Ukraine” the day before it happened
“Ukraine using black magic battalions”
“Ukraine using genetically modified super soldiers”.
Tells the truth?.
I don’t understand how you can think that a country that held a area (Crimea) for years and then started another war and has had 4-5 explosions losing half their Black Sea fleet aircraft is “winning”.
Is losing 1000 tanks and having to roll out T62s “winning”;
Is using soviet anti aircraft carrier missiles against malls “winning”.
Is having oil refineries and ammo depots hit in Russia proper “winning”.
Is having 20,000 troops caught in Kherson with no easy way to leave or resupply “winning”.
The situation is so dire in Crimea that there was a traffic jam of people trying to leave.
The PRC doesn't even get to decide who goes to Taiwan, who do you reason that they get to decide what is done with Taiwan?.
Ignoring for a second the fact that this has a lot more to do with geopolitics and hedging geopolitical risk, I think it's important to think more carefully about the impact of companies investing in developing economies.
By and large, the factory work done by people in developing economies is dramatically better in terms of quality of life and safety than the agricultural work that they would be doing without economic development. It would be better if the factories were more often owned domestically (instead of owned by Chinese companies), but the actual workers are not suffering in the short term as a result of Apple bringing jobs. The complete opposite is true.
Not to mention the poverty of the slaves themselves.
https://ourworldindata.org/uploads/2013/05/World-Poverty-Sin...
They call their country communist because they can't afford to undermine the legacy of the communist party by admitting that they made huge mistakes in the past.
People like to gloss over the more complex reality that is Chinas actual economic structure when it benefits their personal ideological agenda.
Note that my comment doesn’t call that into question though, only that the conversation around chinas success is almost always grossly oversimplified to suit ideological agendas.
To be fair, a fairly big reason why China became poor was because of western imperialism. Look up "Century of humiliation".
And if you go back in history far enough, China was the most advanced country and had the highest GDP in the world for long periods of time.
But I think you're not open to these ideas.
It is quite clear, however, that most analyses of their economic successes don’t add that nuance and come to the predetermined conclusion that I outlined above: the success is due completely to adopting western capitalism, and the negatives are due to the elements that don’t fit that mold.
Some of the above is “capitalistic” and some of it is not. Commentators have been predicting China would continue to shift towards becoming more capitalist or fail for decades and they’ve been continuously proven wrong. China has developed a completely different model of development from the western consensus, but people still want to have their cake and eat it too.
But yes, I totally agree that you don't need to be 100% capitalist to benefit from having a market economy. Even the US's economy is ~15% public sector. Usually when multiple ideologies are competing, there's elements of truth all around.
A system with the property rights that exist in China is a long cry from any reasonable definition of capitalism.
[0] https://money.cnn.com/2017/08/14/news/economy/trump-china-tr...
Sure, China has copied/stole tech from the West, just as the West has copied tech from China long ago. It happens when an economy is playing catchup.
But in my humble opinion, the idea that China could only steal western tech is rooted in racism and a lot of western media propaganda.
Ever had a Chinese co-worker? Did they seem dumber than you? Are they only good at the job because they're copying you or stealing your work?
Also if the government orders you to steal secrets from your clients to follow such orders it's just basic survival instinct.
Unfortunately that engine will now falter and many will be left behind.
For an eye opening survey here, I highly recommend the book Invisible China.
[0] - https://data.vietnam.opendevelopmentmekong.net/dataset/fefed...
[1] - https://www.rfa.org/english/news/china/workers-1029202011165...
I bet Xi Jinping knows research work in the similar lines of Invisible China.
https://www.worldbank.org/en/news/press-release/2022/04/01/l....
…and transitioning more to a service economy
…no?
To paraphrase an earlier comment I wrote sometime back:
Chinese household median income is around $4,700-4,800 in 2021, with massive disparities between First world comparable regions such as Beijing, Shanghai, and Tianjin, and rust belt regions like Wuhan [0]. Even the Chinese Premier Li Keqiang has noted that 600 million Chinese earn less that $140/month [1].
[0] http://www.stats.gov.cn/english/PressRelease/202201/t2022011...
China is not a good example for the middle income trap. Middle income trap countries relied on cheap labors but could not move up in the value chain.
China has moved up the value chain. They're the top or close to the top for many things including mobile phones, chip manufacturing (7nm), AI, software, 5G, electric car batteries, nuclear power, fusion research, quantum computers, etc. They also publish more scientific papers than any other country, by a significant amount.
Conversely, true middle-income country like Brazil and Thailand have not moved up in the value chain one bit.
China, Singapore, Hong Kong, South Korea, and Japan are all East Asian countries. They all have very similar values when it comes to education, hard work, and entrepreneurism. It's only a matter of time until China joins the first world. Their major cities are already first-world.
Yes, there are countries that have cheaper labor than China right now but China should be able to replace that with higher value services such as exporting 5G tech or nuclear power plants.
There is no denying the amount of growth the service sector in China has seen, yet a lot of this growth and development is among a sliver of the population living in better developed regions such as the various coastal prefectures. Beijing, Tianjin, Guangzhou, Shanghai, etc can be treated as developed, but what about the hinterlands such as Sichuan, Ningxia, Hunan, Guangxi, etc? This middle income trap is not a good thing by the way - I take no joy pointing this harsh truth out because this means hundreds of millions of PRC nationals are stuck in less than ideal economic positions.
Also, if we are talking about the value chain, Brazil is very high in the ONG (Petrobras, Odenbrecht), Aeronautics (Embraer), Automotive, and Defense (Odenbrecht, Embraer) value chain thanks to economic policies in the 90s and 2000s that are comparable to those the PRC has started adopting in the past 10-15 years.
[0] http://www.stats.gov.cn/english/PressRelease/202201/t2022011...
[1] https://en.wikipedia.org/wiki/List_of_administrative_divisio...
[2] https://en.wikipedia.org/wiki/List_of_Brazilian_federative_u...
[3] https://agenciabrasil.ebc.com.br/en/economia/noticia/2017-02...
[4] https://en.wikipedia.org/wiki/List_of_federal_subjects_of_Ru...
[5] https://tass.com/economy/1301957
[6] https://en.wikipedia.org/wiki/List_of_Mexican_states_by_Huma...
[7] https://www.efe.com/efe/english/life/mexican-households-have...
This is the present. It does not mean China is a middle income trap nation. It continues to grow and advance in innovation.
Also, China's GDP PPP per capita has already surpassed Brazil. GDP PPP is a much better measure of stand of living than GDP/capita.
The biggest factor in whether a country stays in the middle income territory is innovation.
China is innovating. In some areas, it's already leading.
Countries can have cutting edge industries AND still lag behind in development - Brazil (Defense, Aerospace, ONG, Automotive), South Africa (Defense), Turkey (Defense, Automotive, ONG), Mexico (Defense, Automotive, ONG), Russia (ONG, Defense, Aerospace, Automotive), Malaysia (Automotive, ONG, Electronics), etc are all countries that are major innovators and even leaders in STEM/innovtion heavy industries, yet still have significant issues with spreading development across their countries. The PRC is facing a similar issue, and it is a hard nut to crack - I can't think of a single middle income to upper income economy that didn't also
1. receive a massive subsidy from either the EU (southern Europe, eastern Europe, Ireland) or the US (South Korea, Israel, Taiwan)
2. have a small population (<30mil at time of transition)
It is harder to lift a nation of 400 million poor (using PRC poverty definition) people than to lift a poor nation of 30-40 million.
Also, this same trap that China is in is something that India, Vietnam, Indonesia, and the Phillipines will face in 20 years
Purchasing power parity (PPP) allows for economists to compare economic productivity and standards of living between countries.
https://www.investopedia.com/updates/purchasing-power-parity...
>Countries can have cutting edge industries AND still lag behind in development - Brazil (Defense, Aerospace, ONG, Automotive), South Africa (Defense), Turkey (Defense, Automotive, ONG), Mexico (Defense, Automotive, ONG), Russia (ONG, Defense, Aerospace, Automotive), Malaysia (Automotive, ONG, Electronics), etc are all countries that are major innovators and even leaders in STEM/innovtion heavy industries, yet still have significant issues with spreading development across their countries. The PRC is facing a similar issue, and it is a hard nut to crack - I can't think of a single middle income to upper income economy that didn't also
Brazil does not lead in Aerospace, ONG, Automotive. South Africa does not lead in defense. And so on. They do not possess technology that other countries depend on. For example, Embraer's revenue in 2021 was 4.2 billion. Puny compared to Airbus' 52 billion. If Embraer stopped operating tomorrow, the world would not notice.
We're talking about actual innovation and a technology advantage. You mentioned that Mexico leads in automotive. What? Mexico does not have any cutting edge automotive technology that other nations depend on. Mexico is a hub for car manufacturing because it's close to the US and provides cheap labor. They do not produce any car tech that other countries cannot produce.
Real innovation is something like China's CATY new car battery which outcompeted Tesla's 4680 battery. https://medium.com/predict/tesla-is-about-to-lose-its-tech-a...
Before Tump's ban, Huawei was set to provide 5G technology to the UK, a country that could not produce 5G equipment on its own. A true middle-income country could never do this.
One of OG researchers who coined the term believe phenonmenon is overstated, to the point of not being useful or existing at all. Fundementally, middle income trap is not a good concept in evaluating PRC because even according to the original middle income analysis countries with proper industrial policies designed to move up value chain (like PRC) is likely continue out grow developed countries and in PRC's case, close capability gaps. It's less about being trapped within arbitrary per capita bracket (which PRC is set to to reach upper income by years end anyway) and more about industrial stagnation that would theoretically lead to economic stagnation.
Reality is PRC as you recognize is almost like two countries, rich developed coastal that is still rapidly developing, and developing (really neglected) interior. This segregation was by design (Deng's let some get rich first policy), but that "sliver" living in T1 region is ~200M people, which is about Japan, South Korea, Taiwan combined. And really one should include another 200-300M T2 cities due to industrial synergies. Essentially you have a 500M strong rapidly developing country that is spilling out comparable STEM graduates as OECD countries combined while rapidly moving up value chain in every industry, not just a select few like in Brazil. This is the component of PRC that is globally competitive and building up comprehensive national power to the point of becoming pacing threat with US, even if it's dragged down by the interior poor. Just look at record youth umemployment which is absolutely not something to brag about but reflects just how much oversupply of talent resulted from education reforms 20 years ago meanwhile PRC moving up every research and innovation index controlled for quality and have indigenous industries in almost every sector, many of which are increasingly competitive. Even with demographic crisis looming, rich PRC is really just getting started because it is increasingly oversatuated with talent for moving up value chains.
Yeah there's still 600M undereducated poor that can't really be integrated into modern economy, hence common prosperity wealth transfer programs. Think of it as rich high-growth high-income PRC giving handout / economic aid to lower income PRC, not enough that rich PRC stops growing, but just enough that poor PRC isn't spiraling in subsistence and ready to rebel. Ultimately it's useful to think of PRC as massive developed China supporting massive low income China. It's better to have a country with 100 people where 50 rich people can build advanced tech but 50 are stuck being poor farmers then a country with 100 people with equal wages that can only make shoes or farm. Now consider India with 1400M people has 20% of PRC GDP... and while a drain, it really does not take crippling amount of resources relative to PRC GDP to subsidize 600M poor. Last time I did the math, if PRC spends 6% of GDP / 1 trillion per year, it can double income of the 600M poor on 1000rmb per month to 2000rmb. Which isn't great but enough to maintain stability especially if spread out over multiple years so people percieve they're getting richer YoY.
The kind of regional income transfers you mentioned is a MASSIVE legal undertaking that will inevitabely face a significant amount of opposition from the richer coastal prefectures that would be subsidizing said development. You would need a revamping of tax brackets and also, you would still need to work on getting education quality in hinterland regions up to speed. We all want to say China is doing it's own thing for the first time, but this is the exact same story we saw with Malaysia and Mexico in the 90s and Turkey/Russia/Brazil in the 2000s-2010s. And it's not like economists and policymakers in the PRC are blind to this - Shaojie Zhou and Angang Hu at Tsinghua are two econometricians I can think of off the top of my head who are doing reseach on this conundrum specifically while also still in China. Li Keqiang himself is a former developmental economist btw and I wouldn't be surprised if a number of the recentish reforms that have started happening were lobbied by him.
Paraphrase from previous comment:
Countries can have cutting edge industries AND still lag behind in development - Brazil (Defense, Aerospace, ONG, Automotive), South Africa (Defense), Turkey (Defense, Automotive, ONG), Mexico (Defense, Automotive, ONG), Russia (ONG, Defense, Aerospace, Automotive), Malaysia (Automotive, ONG, Electronics), etc are all countries that are major innovators and even leaders in STEM/innovtion heavy industries, yet still have significant issues with spreading development across their countries. The PRC is facing a similar issue, and it is a hard nut to crack - I can't think of a single middle income to upper income economy that didn't also
1. receive a massive subsidy from either the EU (southern Europe, eastern Europe, Ireland) or the US (South Korea, Israel, Taiwan)
2. have a small population (<30mil at time of transition)
It is harder to lift a nation of 400 million poor (using PRC poverty definition) people than to lift a poor nation of 30-40 million.
Again, these countries do not have any innovation advantage in those industries.
Here are actual leaders in those industries:
Aerospace --> USA, EU, UK, Japan
Defense --> USA, EU, China, Israel, Russia
Automotive --> USA, EU, Japan, South Korea, and soon to be China
ONG --> USA, UK
Electronics --> USA, Japan, EU, China, South Korea, Taiwan
Energy --> USA, EU, China
Gaming --> USA, Japan, China
You're confusing having a large industry with leading SUSTAINED innovation.
When was the last time you bought a Malaysian brand electronic? When was the last time you drove a Mexican brand car?
High income countries produce innovation, hence the ability to move up in the value chain, hence moving above middle income trap.
> BY DEFINTION
Conceptually middle income trap is about countries stops moving up value chain and income gets stuck in middle income levels. It's a dumb blunt indicator that has no bearing on equity of development. If country has 100 Tony Starks making 20Trillion dollars in GDP of wizard widgets, while 1.4 billion subsists on crippling poverty but GDP per capita is above middle income, then congradulations, that country has escaped the middle income trap and all the wizard widget would categorize it as an advanced economy even if 99.99% of the impoverished people starves. Techncially if PRC is stuck at +$1 above middle income, it has escaped the trap, but the real question is weather PRC can continue moving up value chain and build competitive comprehensive national power, even at the cost of extreme inequity, not how/whether such equity can be addressed, which obviously is still important consideration for policy makers.
On that note PRC per capita gdp is set reach upper income this year, if not already even with revised slow growth numbers. Official CCP stats is $12,551 for 2021, which will put PRC in upper income of $12,696 with 2% growth this year. If you entertain the Shanghai police leak demographic extrapolations seriously, PRC today has 100M less people and entered upper income years ago. Meanwhile PRC is climbing value chain rapidly in essentially every sector, it's not specializng in a few, like the mid sized countries, but issue is, PRC simply has too many people for everyone to be lifted into upper income range. The difference with Malaysia/Mexico/Turkey/Russia/Brazil is on paper, extrapolating from recent Asian Tiger and other historic medium size country development trends, there should be enough opportunities for middle sized countries of 20-200M to specialize and be competitive in some higher tier sectors and escape the middle income trap.
PRC is not a middle sized country.
My opinion expectation suitable for middle size countries is ridiculous to apply to PRC with 1.4B people where 200M-300M tier1/2/3 workforce (very course guestimate) are already specializing in most sectors + 100s of millions of bullshit makework jobs by SEOs just to keep people busy, while 100s of millions more drift in informal economy. Think of USA with 160M workforce who can do pretty much everything there is to do, except manufacturing, which during peak, PRC employed ~300M. There's simply not enough domestic opportunities or global demand for 1.4B people. A good example is central gov reluctantly holding on to inefficient collective agriculture that employs 450M when realistically mechanization will axe 440M of those jobs and provide better food security.
>MASSIVE legal undertaking
Yes, there's going to be a lot of policy changes and reforms to get common prosperity rolling, or address rural education, vocational training etc. But TBH and blunt, opportunity for education and training has already passed for 100s of millions who are stuck in informal economy. Interior provinces neglected for too many generations. I don't know if they'll be taken care of by safety net or simply neglected - even Xi stressed common prosperity is not about handouts/welfare - but whatever they get, it's unlike to uplift them into upper income. They're never going to experience 25000 per capita China Dream by 2049. I think going forward PRC will remain a 2 tier society, something like gulf state with professional class and migrant labours that goes back to their less developed homes where PPP stretchs further. There's going to be reforms to improve QoL of of the bottom, but the classes are never going to converge. And hot take: CCP probably wants it that way, modern PRC is built and likely can only be sustained by 2 tier society with massive cheap migrant labour pool.
Everything they've built is beginning to fail due to lack of new workers, and an excess of non-productive people.
In a country where most people earn around $1000/year.
They claim to be championing labor rights, but they are often just angered at companies for stopping all manufacturing in the West. They see it as an obvious weakness in their ideology that companies can just walk away from their labor movement and go elsewhere.
The obvious truth, and what literally all of these Vietnamese workers will tell you, is that foreign tech manufacturing is an amazingly better paying job than what is currently available.
The true story with China is that moving Western manufacturing to China raised the standard of living for literally hundreds of millions of Chinese people out of poverty.
This is a strawman.
You're conflating different groups of people with different interests. Some people complain about labor conditions, some people complain that jobs are leaving the country. Almost nobody is "dishonest" about this.
My point was people who care about labor rights, shipping jobs offshore, etc are selective about those specific issues. Never said they had to care about other issues.
My point was that people are inconsistent due to the intersection between their advocacy and their own sense of nationalism. The issues are amplified when they pertain to Americas enemies and lessened when it pertains to Americas Allies.
For a specific example, I did a quick search and Malaysia is one. Malaysia has the same or worst labor practices then China, but no one complains about tech companies relying on Malaysia's poor labor practices.
A blog post that talks about it. https://medium.com/swlh/forced-labor-in-tech-c91daf979201
Everybody is a hypocrite on almost every issue. Take a major issue like climate change. Almost every human in the U.S. and Europe has massively large carbon footprints. Does that mean Americans or Europeans can’t care about climate change? We’re not ideal beings working in an ideal system. We’re flawed being in a flawed system trying to make things a little better.
To me, your argument, fully constructed, is: “you can’t care that Uyghur’s are enslaved because America also uses slave labor and American foreign policy is anti-China.” How is that an argument?
But no, Jim Bob isn't a hypocrite if the information was never brought before him. Jim Bob does become a hypocrite when the information is in front of him and refuses to acknowledge it.
Also the slave labor in US itself, https://amp.theguardian.com/us-news/2022/jun/15/us-prison-wo...
It is virtue signaling, largely to placate and pat themselves on the back to deflect blame from them, that their consumption, their vote with their money, and unwillingness to pay the true cost, is what creates this situation.
HUGE "citation needed" here. Apple did a study years ago (when Obama was President) and the cost to manufacture iPhones in the US was well under 10% of the total cost, by their own calculations.
The cost of labor in China has only gotten worse since then (hence the move to Vietnam in the OP).
No longer the case obviously but more importantly, Apple studied themselves and found they were only saving 10% in costs? This makes no sense lol
(The US, like China, also runs concentration camps. As far as I can tell there is no country on Earth that uniformly preserves human rights.)
Let’s be honest, people complaining about labor conditions have a pretty weak understanding of economics and what is actually going on with regards to these factories. China isn’t stupid. They weaken their currency specifically to bring in the cheap labor jobs to lift the poorest to a slightly less poor tier. Unless you realize how poor they started out with it’s hard to appreciate the gains in wealth even if it still looks dirt poor to an armchair labor rights activist.
99% of everyone has a phone made in China, does this mean it's not possible to complain about the state of the world we live in?
Economists hardly understand the economy, so I’d say they’re in good company…
Jokes aside, demanding better treatment of workers and onshoring of jobs doesn’t seem as insane as people here are making it seem? This whole thread feels kind of irrelevant.
Is there any other option?
Don't stop people from complaining about lead in the water supply, just because they have nothing else to drink.
This kind of reminds me of the plot of The Good Place [spoiler warning] -- in the show it's essentially impossible to get to Heaven because every decision you make has transitive dependencies on awful labor practices, abusive behaviors, and other unseemly things. So everyone ends up in Hell.
I don't think using a smartphone built with evil labor practices is inherently evil. But buying one every year when you could use one for 5 years is probably a bit evil.
Second in line is Bangladesh
P.S. USA had a capitalism approval around 70% in the same survey.
Try again.
Source: I actually live in Vietnam.
https://en.m.wikipedia.org/wiki/Water_supply_and_sanitation_...
The poor's increase in wealth still outpaced inflation.
...and given that the poorest in poor countries had their wealth skyrocket out of poverty, outsourcing has absolutely been a win-win.
Firstly there is vastly more manufacturing in the US, Canada, and Mexico than you appear to realize. Secondly China is far more prone to being embargoed than the United States. If China cut us off then the price of certain goods would increase significantly and there’d be shortages of some goods and industrial inputs but we could feed ourselves, keep the lights on, heat/cool our homes, keep our industry going, and crucially our military capacity would be untouched. China would lose its largest and demographically healthiest consumer market which would vastly deepen its economic hole, lose a huge supplier of food which China can’t do without, and the US navy could interdict all energy shipments to China which would result in the country deindustrializing in a few months after its reserves ran out. Depending on how the embargo was effected it might drag in Japan or India both whose navies could single-handedly cut off China from oil shipments.
The vast majority of their navy and ship building capacity is coastal. Their blue water navy is still minuscule and the challenge isn’t just manufacturing but experienced personnel which is decidedly harder to quickly scale up and is not aided by their terminal demographics.
Most US / global industries wouldn't be going anywhere without PRC supply chains / rare earth processing. Besides PRC is calorie self-sufficient and produces enough raw resources domestically for war economy, and export to west is like... 5% of GDP total, i.e. trivial in total war scenario. Now go look up how much steel, oil and other primary inputs PRC generates domestically... it wouldn't remotely deindustrialize meanwhile PRC military capacity wouldn't just be untouched, it would be allocated the redirected industrial resources to sustain aquisitions multiple times current size.
It's 2022, India and Japan do not remotely have capability to blockade PLAN. Refer to the detailed studies coming out of US wonks recently are questioning the feasibility of whether US can effectively enforce a blockade at all, which btw is an act of war, and in age of networked mutual vunerabilities PRC has options to make US/containment partners to hurt comparably. The amount of oil US produces is not measured in millions of barrels but 130 vunerable refineries and other critical infra that PRC can target in retaliation. Absolutely expect US industrial outputs to come to a crawl, John Deere tractors bricked in the fields, and homes freezing because half the energy grid is compromised in event of PRC blockade. Or that we maybe in or near the timeline where PRC will gain conventional global strike capabilities that places US CONUS at conventional risk.
Quickly is more likely decades to reach appropriate as in case of rare earth processing. There's 20 years of supply chains entrenched in PRC that's not going to be replicated without substantial effort or time. That means allocating resources so strategic companies can survive while everyone else that relies on those inputs die. Btw, most of those experts needed to scale up elsewhere? They're from PRC in PRC building out PRC capacity for last 20 years. There's not enough experts globally to do such a task "quickly".
>Mutually Assured Destruction working between India and China
Yes, which is why the idea India would blockade PRC is fantasy. They fight with fists over barren rocks to prevent escalation spiral, and India has been firm in preventing QUAD into becoming a security alliance. They're not going to escalate to full scale war with PRC while eastern theatre command can shower most of India with missiles from barren Tibet while India has very limited ordnance to reach PRC strategic east coast or XJ. At least not for decades.
There will conceivably be a time when PRC is disentangled from global supplies chains or PRC neighbours have built sufficiently capabilities to target PRC cost free, but it won't be in short/medium term.
China is a massive net importer of oil.[1] I guess they can make steel with coal but they can’t get coal to the steel plants let alone run their whole industrial base if they lose Saudi oil. Russian western pipeline imports might continue for a while but after the super majors exited Russia that isn’t going to last regardless of embargoes.
> US wonks recently are questioning the feasibility of whether US can effectively enforce a blockade at all
What “wonks” are these? The US Navy is by far the largest blue water navy on earth. To disrupt most oil shipments to China could be done anywhere from the Gulf to Singapore and be far out of reach of the vast bulk of the Chinese navy. Just firing a cruise missile or two would do the trick.
> PRC has options to make US/containment partners to hurt comparably
Nonsense. Who precisely? China is surrounded by enemies or frenemies (ie Russia) the US is surrounded by trading partners and ocean and is a naval power second to none.
> 130 vunerable refineries and other critical infra that PRC can target in retaliation
The US has refineries dotted all over the country. The gulf coast refineries and the nation as a whole has one of the best security geographies on the planet. How is the PRC going to attack them exactly?
[1] https://www.energypolicy.columbia.edu/sites/default/files/fi...
>What “wonks” are these
Naval War College Review, something along the lines of "tactically tempting but strategically flawed". There's host of other recent literature that basically concludes that it's not viable at strategic level. Or that USN is large but not nearly large enough to maintain an active blockade for long without abandoning other important commitments. Amount of shipping going through Malacca is massive.
>Who precisely
Every US ally in first island chain is a few cruise missiles to ports/energy infra from regressing into developing country. They're all islands for functional islands _much_ worse food or energy security than PRC, which incidentally is what makes blockading PRC strategically flawed, because it can't be done without crippling US partners. Consider actual scale of force deployed in theatre (overwhelming in PRC favour and growing) and in actual war, US and allies aren't so much as surrounding PRC as being trapped within PRC's growing A2AD bubble. Surrounding PRC works fine for peacetime containment, but during wartime it forces US to go near PRC shores where USN is most vunerable due to security commitments. As for vaunted US naval power, it's limited to what US can deploy and sustain in theatre vs whole of PLA arsenal that's designed to dismantle US sustainment systematically.
>PRC going to attack them exactly
Cyber attacks on critical infra - there's a reason Biden communicated to RU/PRC despite all recent military sheningans and literal war against UKR that attacks on US critical infra = same as physical war. It doesn't matter how offensively capable US power projection is if US is defensively existentially vunerable on the homefront. Which flies over head most Murica strong and can blockade PRC relatively cost free proponents, sure, US can punch hard but like everyone else in networked infra era, US (likey) can't take a punch, but more historically importantly US isn't so out of reach by geography and technology anymore that it cannot be punched anymore. US want to blockade 10M barrels of imports a day? What if PRC takes out 10 million barrels of refinery infra. The scenario is not US can just starve PRC imports, but US and PRC will go balls out in escalation spiral to cripple each other's homefronts to the point of being unable to sustain modern life.
Or look at where PRC conventional hypersonic development and bulk of R&D/aquisition effort is trending. PLA is not rushing to catch up on 11 carrier groups or strategic bombers, they're focusing on precision strike conventional icbms that is able to hite every strategic node/asset in CONUS. Really around the world, i.e. Pinegap in AU. Every major strategic US platform like CVNs, SSBNs, B21s, have to sit still for maintenance sooner than later. Like entire USN runs on like 8 fast combat support ships for high tempo operation that rotates in theatre keep up replenishment. The MO behind PLA systems destruction warfare is to negate US military advantages and cripple US ability to operate at all. Of course PRC is similarly vunerable as well, but at the end of the day US loses much more being unable to defend global commitments because she can't support her blue water fleet than PRC who barely has any blue water obligations in the first place.
Generally, agree with your points, but the US Navy simply does not have the capability to do this any more. Might have been possible in 1990 but not today. US Navy would get its backside kicked.
And thereby strengthened the hand of the CCP.
People who can afford a good education are harder to control.
You can see it right now in Putin's Russia. Opposition to the regime, to the extent that it exists, does not come from the proles.
The protesters were the well educated students. This will always be the tip of the spear for change.
Revolutions that try to leverage the uneducated masses are the most bloody and destructive - and they usually lead to dictatorships, not democracies.
They definitely had much more to lose than Marx's lumpen proletariat.
Of course, now people in China, especially in the rich coastal cities, have dramatically more to lose. They've been shown though that they would be allowed to prosper, as long as they do not try to disobey or even express doubt about CCP's rule. So it's pretty easy for them to convince themselves that CCP's policy is fine enough and not worth protesting against.
Aka nothing to lose. Having family and job would be considered having things to lose. Also let’s not consider students “educated”, they will be if they then build a career and actually practice their knowledge. Any clown can get a degree.
Citation: https://press.princeton.edu/books/hardcover/9780691177823/wh...
Manufacturing has been a growing share of GDP for the past few years, interrupted surprisingly briefly by COVID. Just that most of it isn't assembly lines.
it's true! we can't force anybody to use our labor. but we can control access to our markets.
you don't have to be a union activist to recognize that exporting american manufacturing jobs has been disastrous for our domestic working class.
You do though. The reality is that "exporting" these jobs means cheaper products for everyone, and no one in what you call the "working class" wants these jobs to be in the US if it means they need to pay more for everything.
The US consistently manufactures more every year despite hiring fewer manufacturing workers because improved automation competes with US labor at lower costs.
you might be a little disconnected from reality
>if it means they need to pay more for everything.
yes, now they can pay a little less from their wage.. oh wait, they got fired
you might be projecting
> yes, now they can pay a little less from their wage.. oh wait, they got fired
nah, there are plenty of "working class" people who are working
look at a graph of productivity measures since 1990, a graph of real wages, and a graph of US GINI scores. i'm a knowledge economy worker like most people here, but we have been on a course of serious class warfare and economic cannibalism for decades. but thank you for letting us know that everybody actually wants it this way.
I don't do this personally but we should explore the possibilities.
The thing about capitalism is it is capitalism. You should drive costs down and profits up. Ideally you don't kill people on the "journey" but hey that's what laws n that jud, errr judiciary ... ... cops/police thing is all about or something.
I own a very small company in the UK. We don't go full on capitalism (whatever that monster really is) We strive to be able to sleep at night.
-I knew someone who wanted to set up optical and circuit board manufacturing in Vietnam - the few factories they toured seemed to be set up very well. Also frequently with better female/male ratios in management levels (perhaps bc, at least what they were told, Vietnamese culture tends to be more matriarchal than elsewhere). Maybe why also a lot of Japanese electronic makers (Pentax, Nikon) had a bigger presence in Vietnam than expected
-the irony of Western manufacturing and standards of living - (coupled w/ strong policy and incentive support from the ccp) is that Xi Jinping seems to be actively going against perhaps one of the greatest economic partnership of recent times, namely USA/China. I think that is why there is likely going to be a contraction in the Chinese economy, if not already happen due to Zero Covid. If anything brings down the emperor/dynasty this time, it is because the grain ceases to flow (at least borrowing a phrase from an undergraduate Chinese history class...)
> I would not be surprised if one day it's "communist Vietnam"'s turn to be the scapegoat.
Not even "vibrant democratic India" got spared
The slavers' argument was that treating them bad taught them proper Christian character.
edit: I'm seeing a number of comments pointing out how these are companies owned by Koreans. Which maybe isn't optimal, but the potential for knowledge transfer coupled with investment in infrastructure and logistics chains is a great opportunity that just needs to be used well.
When it eventually gets too expensive for native workers, manufacturing moves again [1]. Except the locals now have a sizable middle class and knowledge economy, and there are high value industrial processes left behind: automotive, aerospace, scientific, etc.
The whole world is growing up, and wealthy nations are paying for it (because they love low cost goods). It's a win-win situation.
([1] doesn't mean every nation shouldn't think defensively about its own supply chain for essential inputs and outputs.)
It might after this winter. Its hard to manufacture without energy and resource input.
This is false because majority of Chinese citizens do not make more than $1000 per year or something very low. The average GDP is something like $6000, which is far below its neighbours. Even the ones that do make more, while not in complete poverty, they are barely live due to expensive housing and cost of living.
We see the problems with this situation right now with Russia and China, whether it's buying oil from Russia or manufacturing in China, we've given these countries enormous amounts of power and influence by essentially funding their regimes. As we can see with the situation in Ukraine and Taiwan these regimes are not our friends or allies, even though we have allowed ourselves to become attached at the hip to them economically. As a western consumer I would much rather see my money either stay in country or go to a country that is a political ally and shares more western political and economic ideals.
You are going to see opressions happening again and again in the future as well. It's just a natural process of society development.
That's one of the main theme's of Hitler's Mein Kampf.
Always nice to see how classy the HN comment section is.
Well done, everyone.
It's different from a political ideology. Because such observation does not justify the oppression, unlike hitler's case.
But ironically, your own comment is indeed a prime example of your own ridicule: poorly informed individual making shallow derogatory snab without consecutive feedback.
As far as I'm aware, there are zero countries that has ever successfully developed without initial phase of authoritarianism / wide scale abuse - europeans had their colonies, US her slaves - it's basically a prerequisite. The second requirement being either on the good books and gaining the support of reigning hegemons or at least not be actively contained by them (East Germany).
Historically, developing countries simply require massive repression (and the occasional dose of cultural genocide) to establish stable national identities and enviroments where people behave like good cogs in the machine to build up the material conditions to enable less opression / more liberalization for later generations. Authoritarianism is the worst form of government for developement... except for all the others that have been tried.
In fact, calling them "western" ideas is exactly how autocracies belittle them to their people.
There are very very few countries that haven't dropped centralized gov't controlled economies - even in Asia.
It would be interesting if you could give an example of similar ideas from seriously non-Western cultures. Say, Asia has plenty of cultures, a number of them with highly developed, original schools of philosophy.
Calling democracy a "western" ideology makes it sound like it's not as relevant to eastern cultures - which is silly because it's now practiced widely in east asia.
The philosophies and ideas are of Western origin. But implementing those ideas is not restricted to people ethically descended from people from Western countries.
to think labor being cheap is the work of the communist party is pretty ridiculous. Authoritarian or not, no government benefits from their citizens being poor (capitalism does). The problem with authoritarian governments is that they are incapable of raising income, not that they do that by intent.
https://en.wikipedia.org/wiki/Great_Chinese_Famine
https://en.wikipedia.org/wiki/North_korean_famine
> no government benefits from their citizens being poor (capitalism does)
Why do you make this incredibly stupid claim?
I'm not sure what more insulting: you calling me "incredibly stupid", or your incredibly poor understanding of basic logic. The former is kind of personal, but the latter is insulting to humans' intellect as a whole so it's a big deal.
Do you have numbers on how it improved life of Chinese farmers compared to 100 years ago, 200?
When the US went through its industrial revolution we went from people owning farms to basically being owned by the factories boss. Child labor was rampant so we’re ridiculous working hours and blacksmiths and others who were put out of a job basically drank themselves to death.
Someone none of that seems to ever happen in other countries and all we hear about is “how great of an opportunity it is for them to get to build iPhones” odd stuff
Bloomberg also reported an incident: Jobs wanted to change the cheap plastic screen to glass, and Foxconn was able to recruit more than 8000 workers overnight and completely reconfigured their assembly line to fulfill such request. This level of efficiency used to belong to the US. I really hope US can revolutionize its manufacturing for this century.
I doubt that.
A fighting army (and navy, and airforce) is one hell of a market; they almost always would like more than you can manufacture.
> In WWII, the US produced 300K planes, 130 carriers, 80 tanks every day on average, increased its steel output to 80M tons in 1944 alone, more than other countries combined
At what cost? What did that labour pool stop producing in order to produce machines of war?
> Foxconn was able to recruit more than 8000 workers overnight...This level of efficiency used to belong to the US.
Isnt that the same company which has suicide nets so that its employees wont kill themselves.
The US consistently increases its manufacturing output through improved automation. US workers are also significantly more productive than other countries', though US labor costs often cancel that advantage.
I certainly hope so. Is it true, though? Obama's documentary, American Factory, says that Chinese workers are more efficient than their US counterparts. I also read somewhere that the average age of workers in shipyards were 55 years, IIRC, and it's harder to find qualified workers who can build heavy machineries in the US than in China, partly because the manufacturing sector shrank so much in the US.
But our willingness to never think about it comes from Vietnam’s irrelevance, not the system they practice
Wait, I think people were much happier and we should go back to an agrarian society and that people are miserable in the dystopia we created, so I need a citation for this.
was cool and reminded me of the guys who fixed my scooter in Vietnam for about 30p a time.
The gastronomic results of the mix have been fantastic. Vietnamese food is already amazing but there are now a ton of food joints that use Vietnamese flavors and southern style bbq techniques for some truly spectacular results.
I have had Vietnamese, I have had BBQs. And I loved both. Now, my mouth is watering for BBQ with Vietnamese flavor.
But the vast majority of these amazing "look what I built" videos from Vietnam are staged and are actually the work of production companies with teams of people. Here is an expose of the primitive building genre where this got its start: https://www.youtube.com/watch?v=Hvk63LADbFc
https://carnegieendowment.org/2020/06/18/is-vietnam-eating-i...
Always found that very ironical.
This combined with upcoming war games involving China and Russia shows clearly where their allegiances lie.
So the risk of China being economically punished is not insignificant and Apple is very likely to be caught in the cross-fire if it does happen.
Russia wouldn't have quite as much military success there right now (given their preoccupation in Ukraine), but it makes sense to keep them happy.
As for allegiances, China has none. Not with anybody. China has no moralistic or principal allies. It simply does what is best for China, and happily plays all sides all at once.
I was hoping the pandemic and the war in europe would teach us that electronics, particularly high end, should be relocated to allied countries at the very least.
He did the same dog and pony show in Great Brittain.
Having moved all of this outside the free world we slowed down progress in our own countries. Imagine being forced to come up with cheaper alternatives at home where we’d be with robotics, automation and space mining today. Instead we finance countries that seek to challenge us.
I remember reading the same argument in the 90s, and it seemed to have a lot of merit. But, experience shows us that it’s not correct.
Putin called it a "special military operation" for a reason. It was supposed to be like Czechoslovakia in 1968. The troops go in, reach Kyiv in a few days, and take over without any real fighting. Ukraine was not supposed to be able and willing to resist. Russian military didn't even know there was going to be a war, which is why it failed so catastrophically in the first days.
The outcome of this war is going to determine whether international trade is still an effective deterrent. If Russian economy depends so much on Western technology that they will lose in the long term regardless of the oucome of the war, this was just the exception that tests the rule. If the West gives up and resumes trading with Russia, the deterrent will be gone.
https://news.ycombinator.com/newsguidelines.html#:~:text=It'....
so, one by one:
1. Not my own stuff
2. Not soliciting upvotes
3. Am kind, just busy so i don't have time to summarize for you the paper that you can just as well read yourself. In fact, it has an abstract, which is a summary, right up front.
China has been India’s largest trading partner for many years. Yet when there was a recent border dispute, everyone was willing to forego all economic ties in favor of a conflict.
Could we at least outsource the NYC MTA to them?
One interesting line of thought (I don't share personally (yet) but find compelling as a dystopian possibility) is that the dirty business of censoring/filtering is outsourced by private companies (i.e. Big Tech with their unparalleled outreach: Twitter, Alphabet, Meta ... ) so that governments can wash their hands of it.
[0]https://medium.com/smartaim-tech/war-for-money-leading-priva...
Chuckled here.
Do you realized that normal American people are being outsourced and they don't have much say to determine the process?
Your words read like a slave joking with fellow slaves: one day our master will outsourcing to some other nations.
That's truly sad analogy.
Funnily enough, this was how war functioned in Europe between 1500-1750s. Armies were too expensive to maintain, so states hired mercenaries. The problem was that mercenaries wouldn't have any incentive to risk themselves to end things quickly. And when you inevitably run out of money to pay them, in the best case they'd just pack up and leave. In the worst case, they'd loot your city on the way out.
Source: https://press.princeton.edu/books/paperback/9780691027647/ma...
Afghanistan is an inhospitable place that doesn't have inherent qualities such as a skilled population, high population density, logistics channels, shipping ports, or a geography amenable to developing the above. They could become a major minerals exporter (there's believed to be a lot of lithium in Afghanistan, for example) but that would, at best, make Afghanistan more like nearby wealthy oil states.
But what I do notice is that Germany, Japan, Korea and Vietnam were all able to break free from feelings of anger and grievance against past enemies. Iraq (and Afghanistan) are populations rife with religion-fuelled and religion-adjacent grievances, pointing internally and externally. Sadly I don't have optimism for change.
As I said before, I know very little about Iraq.
I wish people would have more empathy for Afghanistan instead of berating them.
They’ve just been through 20 years of foreign occupation and a decade of being used as a battlefield for a proxy war not long before that.
When I read removing fundamental woman's rights I thought you were talking about the Roe vs. Wade overturn.
Maybe them catching up to the 21st century should start with .. let’s stop malicious foreign intervention, so they have a chance.
I mean I guess it won't change anything if people do this, but it's just a bit disappointing to encounter it and remember the prevailing attitudes on Afghanistan and the casual dismissal of our own involvement there.
[0] - North Korea and Iran get similar treatment
The problem is, the miners can't be made to do this. It demands huge capital investment they have low to no motivation to fulfil.
This is a great point. My grandfather landed on Normandy Beach on D-Day. He told some stories, but not all of them. He also drove a VW Beetle for years with no shame. Swore by them in fact.
My hope for the future is economic cooperation. Best I know that’s the most effective force for peace.
https://www.theregister.com/2022/05/25/foxconn_wisconsin_fac...
From TFA: >Foxconn also reportedly considered using the site to make electric vehicles and other electronics, but nothing has come of any of its announcements.
Sounds to me like WI is SOL.
https://www.theregister.com/2022/05/25/foxconn_wisconsin_fac...
And yet the kids can’t find work…
In the end what’s the point of having cheaper products if no one has a job to buy them.
Nonsense. The US could obtain the core competencies themselves and indeed will as globalization winds down.
People will never stop coming to the US for opportunity.
Is true _as long as the US continues to understand this_ and doesn't change its stance on immigration and business and open markets. The US will win as long as it's the country where the best of this world are invited and able to come and do their best work.
On the other hand, I don't see China having any chance at beating the US on that front anytime soon. Mandarin is too hard to learn for immigrants, and the racism and lack of freedom is entirely unpalatable to most immigrants. Aside from finance types moving to Shanghai, I'm not sure who would want to move to China if they have the opportunity to move to the US instead. (well, I know many do, but let's just say the quantities are incomparable)
Current trends suggest otherwise, see PRC rapidly catching up and leading R&D and innovation indexes controlled by citations or quality in the last few years.
> quantities are incomparable
If anything US is at an substantial quantity disadvantage and slight to modest quality advantage.
While US does absorb _some_ of the best global talent, those are also subsect of best with resources to go to US, and capped by immigration to around 700k, not all whom are relevant STEM talent for high tech industrial competition. Meanwhile rate of PRC domestic STEM talent generation is about 4-5x (rough estimate generously assuming all US immigration is STEM) of US domestic highereducation + immigration is pulling talent even accounting for outbound PRC brain drain. Yes, US has a bigger pool to draw from but their bucket is also smaller. US was projected to have like 3+ million STEM job gap in coming years, while PRC is generating so much talent that there's record unemploment. Which is obviously not good but puts the numbers in perspective - PRC is producing roughly as much STEM grads as all OECD nations combined, while geopolitical tensions is helping PRC retain more of that talent.
Other considerations is that recent trend of PRC R&D and tech catchup is result of highered reforms set decades ago. PRC is still in process of building talent and institution base compared to relative mature western R&D system. IMO trends last few years show it's entirely possible for PRC to be competitive or overtake US in strategic high tech/talent industries in medium/long term, if not the entire US aligned block who are small subsect of OECD countries. But they I think state of geoeconomics will limit their market access and each will end up leading different blocs.
But what I'm saying is about immigration. I really doubt that the PRC will attract much STEM immigration in the future, at least in comparison to the US. As far as I can tell, the few dedicated folks who choose to emigrate to China do so despite an uphill battle and end up with limited job opportunities. The PRC will have a large internal talent pool to draw from, but will not attract foreign and diverse talent... at least that's my hunch, and mostly because of (1) hostile policies to foreigners (2) language barrier - Mandarin is much harder to learn than English (3) cultural barrier - Chinese culture is old and more self-centered than US's young, outward facing and constantly reinventing culture, and (4) having a bad reputation for personal freedoms and judicial fairness.
So sure, PRC isn't near its final state in term of STEM talent. But I think despite its domestic talent pool, it will not benefit from the diversity of talent that the US will continue to benefit from. And ultimately, 1.3B people is a large pool to draw talent from, but it's not as large as the other 6.4B people.
I do find this topic fascinating. I'm reading a book interview with Lee Kuan Yew which I find is making me reevaluate my prior beliefs. I'm more bullish on China than US on the long term, but LKY's insight were convincing and making a bull case for the US.
> count of publications
Refer to nature science index which collates from prominent western journals with contribution quality assessed by western experts. Or share of PRC science papers filtered/accepted through prestigious western academic conferences in variety of (STEM) domains. Or number of researchers in US/western R&D of PRC origin. There are many indicators that comport with dramatic increase in PRC science competence in recent years that shouldn't be dismissed as pressure to publich / gaming the system but PRC highered reforms finally paying off.
>immigration ... attract talent
I understand, my point is with the population denominator involved, PRC is generating more talent than US can attract. Quantity has a quality of it's own, meanwhile the proportion of quality among mass quantity is constantly being improved. I also think notion that US drawing from global talent is overstated, PRC is drawing from domestic population that accounts for 20% of global population, apart from fringe minorities, everyone in the system speaks Chinese. Meanwhile, US is realistically drawing from 13% of world that speaks English / has english fluency. One stat I recall is by 2030 PRC will have ~3.5/10 of global stem graduates, Indian ~3/10, US ~0.4/10, EU ~0.8/10. Gut guestimate is eligable pool of talent US can actually draw on is not substantially larger than PRC has domestically. That said, intuitively I do feel diversity of talent is important, but I can't really articulate why.
As for hunches on PRC lack of attractiveness for immigration, imo basically true but also misses the point. PRC incentives aren't structured around golden citizenship tickets, but good compensation + access to resources. Look at PRC poaching entire teams of TW and SKR semi engineers by paying them 3x market rate, and building SKR talent churches, basically bribing them with perks knowing full well these are get rich quick limited contract schemes. Or consider PRC thousand talent program with generous perks which work(ed?) pretty well at attracting foreign academic talent, strategically drawing "sea turtles" - Chinese diasphora scientists in premiere western institutions with all the language+culture reprequisits to work in PRC. Pay them lots, give them a well funded lab, it's an easy sell. Work(ed) because it's a tap western policies is attempting to turn off (US China Initiative, TW trying to ban semi talent from working in PRC due to national security). But it's not because PRC is "unattractive", PRC has money, money is very attractive. Ergo PRC geopolitical competitors need to draft literal legistlation to undermine/outlaw strategic talent from working in PRC. In TW's case because they literally can't afford to pay their semi talent well enough to compete with PRC money firehose.
[0] https://www.investopedia.com/articles/investing/080615/china...
https://datalab.usaspending.gov/americas-finance-guide/debt/...
I think it isn’t really very relevant to think about China holding US government debt because it isn’t like they will call up the bailiffs or otherwise be able to exercise control over the US because of that debt. I think it would be basically equivalent to say that China holds US dollars which doesn’t feel particularly concerning to me.
I’m not sure I’d call it ‘rent seeking’. China needs forex reserves like a lot of countries and China is big so it’s reserves are big. It’s just that it is generally more convenient but basically equivalent to hold treasuries instead of dollars if you have an enormous amount of money. Doesn’t eg Japan also hold a bunch of treasuries for similar reasons?
I can’t tell if this is parody or not
So realistically, there's not a lot of "maturity" on the geopolitical world stage. The US is objectively on the "adult" spectrum.
Led by an octogenarian who replaced a septuagenarian man-child.
The offshoring country indeed loses jobs and the jobless need to handle this situation. Some will end up drugged out in the street. I'd argue that these drugged off people aren't that much the fault of corporate leaders who cut costs by offshoring. I'd say the drugged off people are jointly responsible for their fate, along with governmental policies that offer no social net while also not wanting to take any action to prevent spiraling delinquency.
If you look around the world, not every person who loses their job ends up drugged off and homeless. In many places, people are quite poor and don't end up this way. Most people lose their jobs and turn around and figure something out. And then some people can't deal with the hit and don't have what it takes to handle and end up drugged out in the streets. There's some self responsibility going on here that allows this to go down this path. And there's some social policy at play too. In another country, you could only fall so far down before something makes it harder for you to go further down. Either there's strong social nets, or there's just strong anti-drugs laws, or all kinds of debatable policies.. but many of these policies help prevent people getting so low that they can't come back up.
Why is the poor trade worker in VN, living in a metal shed, able to handle abject poverty with dignity, and then get an offshored job and thrive... but the US worker loses their job, has 10x better economical opportunities than the VN worker but ends up drugged out in the street. This isn't a real argument as there are people heading down a self-destructive path everywhere in the world. But I can't help but think that a lot of self-pity has to do with one's own perceived expectations for higher standards and inability to accept loss.
Ultimately, I can't help but think it's an infantilizing argument to say that the hard working factory workers who become junkies, are junkies because someone offshored their job. Because this supposes that they had no agency into doing anything about it, they were doomed to become junkies. This also supposes that a variety of things could have easily knocked them off the good path. That they were fragile and had no recourse or control over their destiny. If it wasn't a CEO offshoring their job, it would have been some other hurdle. And I don't buy this, I don't think the average hard working factory worker is such a fragile person, whose entirely at the mercy and requires the protection of a patronizing CEO.
I think resistance to offshoring is a natural reflex that's entirely futile.
VN and China have been in constant conflict over the sea they share, and their respective commercial and government ships have been in low intensity skirmishes. VN wants to have access to the seas and be able to extract petrol from there. China wants a clear frontyard to be able to protect their economy and trade. VN is too small to do much about China's navy, but with help from the US, it's a different story. In addition, China did try to invade VN right after the US-VN war, and VN remains highly suspicious of China. Hystorically, VN was a vassal state to China (like Korea) and given the trajectory of things and how China talks to their neighbours, it sure sounds like they plan on treating VN (and everyone else) as vassal states once again if and when they come back to world dominance.
From the US side of things, shifting manufacturing to VN is a way to divest from China. And VN workers/trades are quite skilled, so the products themselves are not bad at all.
So while the VN communist party can't just erase their origin story out from one day to the next and remove all the anti-US propaganda, the geopolitics reality is that VN and the US are naturally aligned against China. And similarly, the VN war was a huge cultural shock for the US and you can't just erase that from people's mind. But then pragmatism is that modern day US and VN's interest are a lot more aligned than they're misaligned. In fact aside for the whole history (conflict), political system (capitalist/communist) and governance stuff (freedom & democracy/authoritarian and single party), I think the US and VN don't have much in term of hurdles. The VN population mostly likes US folks (ignoring drunken bravado) and the US has a large VN diaspora and a guilt trip about the VN war.
lol this is a political move, they are just creating Vietnamese shell companies owned by their same Chinese suppliers to get some good PR.
EDIT: politics are definitely a welcome side effect, but not the main reason
https://arstechnica.com/gadgets/2021/12/report-apple-ceo-tim...
Not true for investments in the hundreds of billions.
>The only reason to make a deal non-secret is PR.
This deal was kept secret for PR reasons.
You just agree 100% with the person you were responding to, and brought up an irrelevant point.
China has indicated that it is 100% going to retake Taiwan. Their threat is credible. There were indications it would be soon.
War is a 'new reality' again and we can see the consequences of it.
If you have geopolitical liabilities and you have 10 year strategic planning, then you calculate the odds of 'major conflict' the diversifying away from China is a priority.
Anyone not divesting from China right now is going to get rocked.
Not fully divested but I mean the critical things. We have to plan for China arm of the business dissapeaering overnight.
The world didn't start with 2022 Ukraine(even the Ukraine conflict didn't magically begin in 2022), most of these conflicts started long before Ukraine. The Indian foreign minister also tried to remind the world that it's foolish to try to make everything about Ukraine(see minute 2:30) and yet people don't seem to want to understand the viewpoints of the other 5 billion[1].
If a war broke out between Taiwan and China - Vietnamese operations would be able to continue irrespective of Foxxcon's ownership. Which is the whole point.
The Indian foreign minister's comments are irrelevant in this context, and he's foolish to not contemplate the gravity of the war in Ukraine which has rattled the entire world economy. Actually, not 'foolish' just greedy: he wants to support Putin buy buying cheap Oil, and needs Russia to not be too close to China.
India, politically, is turning into a vile place, which is sad because there's been so much hope for them. Maybe they'll come back.
Russia->Ukraine is an invasion of the 2cnd largest Army in the world, of a relatively modern (if corrupt), large nation in Europe, directly connected to the EU, that has geopolitical implications the world over, as we've seen. Russian Defence Minister has declared that 'The Soviet Unions is Back' and their intentions to expand the Russian Empire into other countries. They've been trying to disrupt NATO nations (i.e. Latvia) for some time, and of course have their eyes on the Georgia and the 'Stans'. That affects everyone.
There has not been a war affecting major powers in a very, long time. Iraq and Afghanistan (and are not) geopolitically very important. Neither was the Iran/Iraq war.
Those wars could happen while the world watched and tried to figure out 'what to do' i.e. 'intervene' or 'not take sides' etc. but those wars are not going to spill out into the world economy.
The Russian invasion of Ukraine is existential, just like a war between China and Taiwan is a 'hugely significant war' that will rattle the global economy like nothing we've seen in decades.
It will involve the US likely directly meaning world's #1 and #2 forces, both nuclear and huge trading partners, and likely include Korea, Japan, Australia, maybe Canada as well. Possibly Europe.
The result could shift the world order in the same way that Russian/Ukrainian invasion is i.e. Asians will be forced to pick sides in the cold war: USA/Japan/Korea/Australia/Europe ... or be Chinese vassal. Or try to fanatically figure out an in-between path, which maybe only India has the power to do.
Those with foresight would have seen this impending reality 10 years ago (see: Kevin Rudd, former Australian PM leading the Asia Society in US) but only now it's become very evident. And FYI it's actually quite rare that we can predict a war so early on - only when you have a kind of foreign policy that's really consistent over time is this going to happen.
And so: big companies realign. Those who don't are likely to pay a price.
China's #1 foreign policy goal is to take Taiwan and they are going to use all of their resources to try to do it.
If Biden is smart, he should up the relationship with Pakistand and Afghanistan. its deadly combo
The West doesn't make it's partnership decisions so much about who can hold out in a war across their borders.
India is a quixotic place, but not a bad one. I don't think anyone expects them to 'go to war' for anything, and neither Pakistan nor Indian soldiers I think are prepared for real action beyond their borders (though no doubt they'd fight in their own defense or against each other).
Really it'd just be good if India wasn't buying Russian Oil opportunistically.
That's an 'active' choice they have made, to 'increase' business with a bad actor.
It's opportunistically selfish.
Everyone realizes the dangers that Russia poses to it's neighbours, and some really don't give a smack, it's one thing to 'watch and do nothing' another thing to 'help'.
Vietnam is a capable developing country that may do a lot manufacturing in the future. Samsung has been working with Vietnamese subsidiaries for a while now, so move by Apple is already proven to be viable.
Last time I look, Apple was hiring a lot of HW engineers in Saigon. (Still no SW engineers, though :))
Also, Foxconn is a Taiwanese company, not Chinese. (Setting aside the issue of "what is China, really".)
How much does it cost in that location now compared to what it's going to cost now to make it in Vietnam?
How many Vietnam workers is this going to employ, and are they going to be working for like... $3/day?
So... a lot of people.
'Money is the first thing. Morals follow on.' (based on B. Brecht)
From Wikipedia:
Democracy Index 2021: Vietnam 131 / China 148 (Norway 1 - best / Afghanistan 167 worst)
Freedom In The World 2021: Vietnam 167 / China 184 (Finland 1 - best / Syria 194 - worst)
The actual thing is not really poor population, but how easy is to build new factory there.
Vietnam has the best thing for that - it is easy to build new stuff there, as the infrastructure exists; however, they absolutely ignore any environmental laws and just spew all waste into rivers and air.
Look up Formosa Steel incident - https://en.wikipedia.org/wiki/2016_Vietnam_marine_life_disas... - huge disaster of a Taiwanese company, after which there were big protests. Communist government then arrested all protesters and put them to 20 years in prisons (for protesting against a foreign company!). Nobody protests about environmental waste now.