[HN Gopher] China is the manufacturing superpower
___________________________________________________________________
China is the manufacturing superpower
Author : luu
Score : 167 points
Date : 2025-01-04 05:25 UTC (17 hours ago)
(HTM) web link (cepr.org)
(TXT) w3m dump (cepr.org)
| blackeyeblitzar wrote:
| The GGR measure suggests they have a self sustaining economy to
| some extent. This manufacturing capacity, even if it's "only" a
| third of global capacity, is a danger to free societies. It'll
| ultimately be used to force the CCP's authoritarian control on
| Xinjiang, Tibet, Hong Kong, Taiwan, and probably others.
|
| Unfortunately I don't know what short term options there are to
| contain the CCP's power and control over this capability. The
| conclusion of this informative article says this:
|
| > China is now the world's sole manufacturing giant. As its
| recent success in electric vehicles demonstrates, its wide and
| deep industrial base can help it gain a competitive edge in
| virtually all sectors. The exceptions are the most advanced
| sectors, where the G7 countries still dominate.
|
| > Politicians who indulge in loose talk about decoupling from
| China need a clear-eyed look at the facts. As we have shown
| (Baldwin et al. 2023), all the major manufacturers in the world
| source at least 2% of all their industrial inputs from China.
| Decoupling would be difficult, to say the least.
| euroderf wrote:
| There is no political will - or sufficient tax revenue - to
| subsidise a broad-based OECD manufacturing economy. Factorio-
| China produces more than the world (or China itself) can
| affordably buy. Let's see if it's all sustainable. Are many
| American homes not warehouses for Chinese overproduction ?
| jkestner wrote:
| "Wide and deep" is key here. Chinese manufacturing is hungry
| and way more competitive than in the US. Physical manufacturing
| in the US is geared toward the largest companies and the
| defense-industrial complex. If your products have any
| complexity to them (starting with electronics), a small company
| has little chance of getting access to good factories and
| pricing.
| advael wrote:
| Huh. For all the claims that US manufacturing is down, it does
| seem that if we adjusted per-capita it's on par with China based
| on the figures presented here, which I really didn't expect to
| see
|
| I'm no expert and of course I have no clue if it even makes sense
| to measure per-capita manufacturing share, and also assume a lot
| of other factors matter here - what kinds of things we're
| manufacturing, how much those products serve domestic versus
| export markets, etc - but it's still surprising
| elashri wrote:
| > it does seem that if we adjusted per-capita it's on par with
| China based on the figures presented here
|
| Ironically this will make Taiwan the manufacturing superpower
| if it is calculated per-capita. Which is the other china (I am
| just referring to the history of both PRC and Taiwan claiming
| to be the historical China successor).
|
| And the claims that US manifacruting is down is correct because
| it used to be much higher percentage wise from the world total
| manifacruting power. China was only about 3% when people who
| are now 30yrs were born. That's massive increase in
| manifacturing share. There is a discussion about domestic vs
| export in the study too that you might find interesting..
| seanmcdirmid wrote:
| > (I am just referring to the history of both RPC and Taiwan
| claiming to be the historical China successor).
|
| Semantics, but the ROC (Republic of China) claims Taiwan,
| along with the mainland and Outer Mongolia. It isn't the case
| that Taiwan claims the ROC (although if the in power DPP
| decided not to be the ROC anymore, the PRC would probably
| invade since declaring independence from the ROC would be the
| same as refuting one China).
|
| When the ROC/KMT retook Taiwan in 1946, they weren't exactly
| seen as liberators. And when the KMT and a bunch of rich
| mainlanders relocated there in 1949, there were protests,
| genocide, and so on.
| ipnon wrote:
| You might be surprised to learn that manufacturing is larger
| industry in the US than our tech industry, or that our domestic
| oil industry is even larger. America produces more oil than any
| other country.
|
| America was the world's factory for over a century. This
| dominance only ended around 2010, when China took the lead. It
| was our advantage to lose, and it was the result of deliberate
| political action. We offshored manufacturing, and treated China
| as a good faith trading partner, waiting decades for a
| cooperative international trade diplomacy that has not
| materialized to this day. All the while Beijing did everything
| in its power to enrich the Chinese worker, no matter the cost
| to outsiders. The results speak for themselves.
| danans wrote:
| > All the while Beijing did everything in its power to enrich
| the Chinese worker, no matter the cost to outsiders. The
| results speak for themselves.
|
| In fairness, during this period, the US did everything it
| could to suppress the wages and benefits of its own
| manufacturing workers.
|
| Recall that the first rounds of manufacturing outsourcing
| were to US states with non-existent labor protections, mostly
| in the South.
| wakawaka28 wrote:
| The only way to protect wages in the face of competition
| that works for 1/10 to 1/3 the rate is to institute
| protectionist policies. That has also been unpopular
| because there's money to be made in offshoring as well.
| Americans are getting the worst at both ends, and only
| experiencing short-term benefits of having cheaper goods.
| rat87 wrote:
| Some people don't like protectionism because in the long
| term it's worse for both countries. You have a short term
| benefit of protecting a handful of jobs in exchange for
| vastly more expensive goods for everyone as well as more
| expensive inputs to your other products undercutting
| other local industries. Protectionism is popular because
| the benifits for the few are visible while the downsides
| are diffuse but add up. And in the end your business ends
| up going out of business anyway like the Soviet factories
| maeil wrote:
| > Some people don't like protectionism because in the
| long term it's worse for both countries.
|
| I keep seeing these statements on here and they're
| utterly misleading. Protectionism is a spectrum. It is
| practiced by every single country. It's a very bold
| assumption to make that if every country would completely
| eliminate everything resembling it, this would benefit
| everyone. The opposite is very likely. There are numerous
| cases of protectionist policies where the country
| instituting them very clearly benefited from them, even
| in the long run. I have spent more than a decade in two
| countries, each having been on a different part of the
| protectionist spectrum since many decades ago. It is
| clear as day that the more protectionist one has,
| throughout, continuing to this day, seen very large
| benefits from this policy, larger than the benefits from
| the less protectionist country.
|
| We really need to stop propagating this myth among the
| educated in the West, it's just as harmful as "trickle-
| down economics" used to be before it became common
| knowledge that it's a fairy tale.
| kriops wrote:
| A reduction in the space of possible allocations of
| resources isn't good. It is good for any particular set
| of parties insofar as it hurts some other set of parties
| more than themselves. This is neither complicated nor
| controversial.
| wakawaka28 wrote:
| >A reduction in the space of possible allocations of
| resources isn't good.
|
| I would personally like to eliminate allocations of
| resources that put me out of business and wreck the
| country.
|
| >It is good for any particular set of parties insofar as
| it hurts some other set of parties more than themselves.
|
| There's a huge misunderstanding in here somewhere. Most
| people don't think of their own welfare in terms of a
| negative outcome for anyone else. It's not necessarily a
| zero sum game. People can coexist and duplicate effort,
| and that sometimes makes sense. An individual or nation
| should strive for some reasonable level of self-
| sufficiency, because you can't always rely on other
| people to treat you well or take care of you.
| kriops wrote:
| To the second half: If some other party seeks to hurt
| you, it is in your best interest to prevent them from
| doing so. Especially if the cost is less than the harm
| they would inflict. Presuming peaceful coexistence, then
| it is not in anyone's interest to limit anything beyond
| the basic idea of 'my freedom ends where your begins'.
| wakawaka28 wrote:
| >Presuming peaceful coexistence, then it is not in
| anyone's interest to limit anything beyond the basic idea
| of 'my freedom ends where your begins'.
|
| Let me put it another way. Your comment suggests some
| kind of state of maximum efficiency in which the best
| producer can be charged with production in a monopolistic
| fashion, and that would limit the amount of resource
| usage and toil for everyone. In an ideal world with zero
| possibility of conflict or other externalities like
| tsunamis, volcanoes, extreme weather, disease, etc.,
| along with perfect foresight of each monopolist, that
| makes sense. However, we do have possibilities of
| disruption that make redundancy beneficial. A
| monopolistic structure can also grow stagnant. With more
| competitors you have more chances for good ideas to break
| through. There is a cost but it is essential to maintain
| some competition and redundancy across geographic and
| cultural bounds even if it is not the absolute
| mathematical minimum resource solution. This redundant
| effort also helps the labor market by giving people
| something meaningful to do that might otherwise be
| unmarketable.
|
| My idea of instituting duplicate effort requires support
| from a lot of people, because it's not free of cost. But
| I think it's the right way to manage society.
| BoiledCabbage wrote:
| > I would personally like to eliminate allocations of
| resources that put me out of business
|
| So would travel agents, real estate agents and car
| dealerships.
|
| Just because a change in allocation of resources or
| production would end businesses / jobs doesn't
| necessarily make it a bad thing.
|
| I'm not arguing whether this specific policy is good or
| bad, but mainly that the argument don't do it because "it
| would cost jobs somewhere" doesn't mean something is a
| bad policy. Just about every change in the economy costs
| jobs somewhere. The question is: Does it create more jobs
| (or higher standard of living) in other places to make up
| for it?
| wakawaka28 wrote:
| >So would travel agents, real estate agents and car
| dealerships.
|
| Yes, but these people also provide good services. I think
| car dealerships might be the best bad example out of
| these because car manufacturers don't deal directly with
| customers. However, I think the fact is that the
| manufacturers who set it up like this don't _want_ to
| deal with customers, and they establish dealerships that
| agree to a certain quality of service that the
| manufacturer wants associated with their name. Car
| dealers are explicitly authorized to negotiate prices
| with customers, which can go either above or below MSRP.
| If the manufacturer was selling directly to you, you 'd
| probably be stuck with ONE price which might not be the
| best one. All three of the cases I quoted here can be
| viewed as a form of optional delegation that usually
| benefits the producer, the consumer, or both.
|
| If it can be proven that there is a better way to
| allocate resources (especially on a micro scale), that
| way should not be categorically banned. But at the
| international scale especially, you need to be careful.
|
| >Just because a change in allocation of resources or
| production would end businesses / jobs doesn't
| necessarily make it a bad thing.
|
| Yes a handful of unimportant ones here and there doesn't
| have to be so bad. But if strategically important
| businesses and jobs are eliminated in an allegedly
| sovereign region, that is usually a bad thing
| (proportional to the size of the region). If too many of
| the less important jobs in a region are eliminated or
| challenged, that puts stress on the people which is also
| a bad thing.
|
| >I'm not arguing whether this specific policy is good or
| bad, but mainly that the argument don't do it because "it
| would cost jobs somewhere" doesn't mean something is a
| bad policy. Just about every change in the economy costs
| jobs somewhere. The question is: Does it create more jobs
| (or higher standard of living) in other places to make up
| for it?
|
| I think this question only makes sense if you're talking
| about a relatively closed, cohesive system like a
| sovereign country. "Higher standard of living" is not the
| only metric that needs to be optimized (at least as it is
| commonly defined). We need to have a resilient country to
| the extent that we can. That might mean paying extra
| costs to support our native businesses, or accepting
| somewhat worse products in some cases. For example, you
| personally could cut or reduce most of your insurance and
| stop saving for retirement. That would put more money in
| your pocket every month that you could use to buy cool
| stuff. That might be interpreted as a higher standard of
| living. But is it wise? This is not far from what we have
| done on a national scale, driven by globalist policies
| and profiteering.
| typ wrote:
| It depends. We can say that China's industrial policies
| are a kind of protectionism as well in that they are
| willing to pay for extra cost for domestic "national red
| supply chain independence" rather than relying on the
| "comparatively advantageous" western vendors. And they
| did get excellent results. Note that industrial
| independence is exactly the opposite of free trade and
| that has been a long sought national goal by China.
|
| Regarding tariffs on China exports, the relatively
| fortunate position for the US is that the biggest
| components in consumer inflation index such as food,
| housing and energy are all either largely domestic
| produced or not dominated by China, which gives more room
| for the US to react. But the tariff could still harm the
| gross margin of the international enterprises and even
| SMBs, who are facing the immediate pressure of adjustment
| during the trade war.
| wakawaka28 wrote:
| China has a high amount of protectionism. You can't sell
| in China without approval, and no foreign-controlled
| business is granted access. You have to set up a minimum
| 51% Chinese-owned subsidiary and possibly jump through
| other hoops to get access. This along with all the
| outsourcing has been used to steal IP and put foreign
| competitors out of business.
| rainsford wrote:
| > Some people don't like protectionism because in the
| long term it's worse for both countries.
|
| That is a good argument from a purely economic
| perspective, but the ability of a country to manufacture
| things on their own is a long-term benefit to the country
| from a security and sovereignty perspective. It's hard to
| prevail in a war if a potential enemy is making all your
| stuff for you.
|
| China understands this very well, which is why they spend
| an enormous amount of effort and resources building up
| domestic alternatives to manufactured products they still
| rely on non-Chinese sources for. Comac may or may not
| become globally competitive with Boeing or Airbus, but
| that's not really the point of the venture. China wants
| domestic aircraft expertise and capacity because it's
| critical to have and they don't want to be reliant on the
| US or Europe for it.
| whatshisface wrote:
| It's hard to prevail in any war in a post-nuclear age.
| Profiting from a war with China is a total fantasy, it
| would be the end of both countries, even if we had as
| little trade with them as with the Soviet Union.
|
| The reason we are not manufacturing everything ourselves
| is that our incumbents refuse to allow anything to
| replace them, whether that is a more efficient company or
| a more able manager. They have the sway within the US to
| get what they want, and so things like patents and
| approval processes (which China does not have to the same
| degree, because for all of their flaws the government is
| more powerful there than the established manufacturers),
| will stop anyone from improving on GM within Michigan.
| The competition comes from within a country they can't
| determine the policy of.
|
| Germany is suffering from a similar ailment. They are
| stagnating because for fifty years successive
| administrations have equated success with success of
| their majors.
| wakawaka28 wrote:
| >It's hard to prevail in any war in a post-nuclear age.
|
| Another cold war is possible, and someone could prevail
| eventually.
|
| >The reason we are not manufacturing everything ourselves
| is that our incumbents refuse to allow anything to
| replace them, whether that is a more efficient company or
| a more able manager.
|
| That is not true in general. We have laws specifically to
| promote competition. I'm not aware of anything like that
| in China, although I haven't looked. I can tell you that
| it's common knowledge in China that doing certain kinds
| of business requires a bribe or connections.
|
| >They have the sway within the US to get what they want,
| and so things like patents and approval processes (which
| China does not have to the same degree, because for all
| of their flaws the government is more powerful there than
| the established manufacturers), will stop anyone from
| improving on GM within Michigan.
|
| First, the Chinese government owns or has a stake in many
| companies there. I think you're even required to have
| certain CCP officials inside your company if it's big
| enough. Second, China does have patents and IP laws. They
| also have pervasive state surveillance, so your ideas can
| be stolen by the government. I often wonder if WE have
| that too, but at least total privacy is legal here.
| Americans can stop the state from spying on them in most
| cases, at least as far as we know.
|
| >The competition comes from within a country they can't
| determine the policy of.
|
| I think you're mistaken about this too, because many
| party members are rich and involved in business. They CAN
| determine policies. There was a huge crash in the Chinese
| stock market a couple of years ago as one party faction
| fought with another one. That was totally anti-
| competitive, yet it happened, and Western investors got
| screwed. I heard it was the result of a fight between Hu
| Jintao (the previous president of China) and Xi Jinping.
| I think the campaign against Hu was touted as a way to
| fight corruption. By the way, Mr. Hu has only been seen
| in public like once since he was dragged out of a
| national party meeting in 2022.
|
| >Germany is suffering from a similar ailment. They are
| stagnating because for fifty years successive
| administrations have equated success with success of
| their majors.
|
| Germany is currently stagnating because of the toll the
| Ukraine war is taking on them, along with other
| commitments they've made such as shutting down all their
| nuclear power plants. They too have high labor costs and
| so on, like the rest of the West, but they were doing
| relatively well until recently.
| sangnoir wrote:
| > Some people don't like protectionism because in the
| long term it's worse for both countries. You have a short
| term benefit of protecting a handful of jobs in exchange
| for vastly more expensive goods for everyone as well as
| more expensive inputs to your other products undercutting
| other local industries
|
| Expensive goods only result from half-assed
| protectionism. When governments go the whole nine yards,
| such as with China's PV and EV industries, or the US with
| agricultural subsidies, it results in very cheap products
| and inputs to other products. Corn syrup is an ingredient
| to a lot of American food items because it's a cheap
| sweetener due to all the subsidies as the government
| decided, many decades ago, that American farmers should
| be shielded from competition. Some decisions make sense
| in the realm of national strategy and geopolitics, and
| not pure economics. The US would be very different if it
| had started to import the bulk of it's corn from Ukraine
| in the late 1990s
| whimsicalism wrote:
| What the heck? When did this sort of economically
| irresponsible thinking become so mainstream?
|
| The benefits of protectionism are what are short-term,
| but they leave both us and China materially poorer in the
| long term. Life today is better than it was in the 1950s
| -- and a large part of that is knowing our comparative
| advantage and leaning into it, not trying to restore
| long-dead industries by political fiat and throwing
| trillions in good resources after bad initiatives.
|
| If we want to help workers who are struggling - then tax
| more and redistribute more. Don't throw a wrench into
| mutually beneficial trade (and completely sabotage our
| critical climate goals while we are at it, it makes no
| sense that we treat BYD the way we do).
| wakawaka28 wrote:
| >What the heck? When did this sort of economically
| irresponsible thinking become so mainstream?
|
| It's not "irresponsible" to deny the existence of some
| utopia where everyone's interests align. It's not worth
| competing with virtual slave labor. A perpetual race to
| the bottom is not what we should be striving for. With
| our current standard of living, or even half of it, we
| don't make anything that is going to be economical to
| export in the long run.
|
| >The benefits of protectionism are what are short-term,
| but they leave both us and China materially poorer in the
| long term.
|
| You're not entirely wrong. There is a cost to duplicating
| effort. What is the cost of not being independent? Your
| country's sovereignty and maybe your life. Let us take
| care of ourselves as best we can and import only a small
| amount of stuff.
|
| >Life today is better than it was in the 1950s -- and a
| large part of that is knowing our comparative advantage
| and leaning into it, not trying to restore long-dead
| industries by political fiat and throwing trillions in
| good resources after bad initiatives.
|
| I think many would argue that life is worse today than it
| was in the 50s. Sure we have more consumer goods, but
| housing is unaffordable and many people are working well
| beneath their capacity at meaningless make-work jobs in
| the service industry. The "long-dead industries" you
| speak of are alive and well, just not HERE. Not because
| others are necessarily doing those things better either.
| It is all about labor costs and regulations in
| conjunction with international competition.
|
| >If we want to help workers who are struggling - then tax
| more and redistribute more.
|
| First of all, many aren't working at all because there
| are no good jobs for them. Second of all, what exactly
| are we going to tax if everything is offshored consistent
| with the current trend? What are we going to buy our
| imports with, the land under our feet (which is finite
| and also our home)? Increasingly worthless paper,
| promises to drop bombs or not drop bombs somewhere, etc.?
|
| >If we want to help workers who are struggling - then tax
| more and redistribute more. Don't throw a wrench into
| mutually beneficial trade (and completely sabotage our
| critical climate goals while we are at it, it makes no
| sense that we treat BYD the way we do).
|
| Oh yes, nothing more critical to cutting pollution than
| shipping giant logs to China to be turned into
| toothpicks. Give me a break. It makes total sense that we
| treat BYD the way we do. It is unfair competition that
| would destroy one of the few industries we have left, and
| China isn't exactly eager to buy cars from us (nevermind
| that they cost too much for the Chinese anyway). We might
| all be better off if every country produced what it
| could. It may lead to new discoveries in design and
| production methods. And if international trade was not an
| issue, countries could freely copy each other's IP for
| domestic use. That last part might be too optimistic but
| monopolies create stagnation.
| acchow wrote:
| > You might be surprised to learn that manufacturing is
| larger industry in the US than our tech industry, or that our
| domestic oil industry is even larger
|
| US oil and gas industry has $240bn in annual revenues. This
| is about comparable to how much Americans spend at Apple
| (almost $200bn)
| ajax33 wrote:
| The number you quoted for oil and gas revenue is quite low.
|
| ExxonMobil alone made $300 billion in revenue in 2023.
|
| Even if you look at oil majors that only operate in the US
| - Marathon had $170 billion in revenue in 2023.
| greggyb wrote:
| I don't think that you're correct about US O&G revenue.
|
| The US produces 13M barrels of crude and condensate per
| day: https://www.eia.gov/todayinenergy/detail.php?id=61545
|
| The lowest recent spot price is $69.5:
| https://www.eia.gov/dnav/pet/PET_PRI_SPT_S1_D.htm
|
| This tells you that annual production of _just_ crude oil
| is > $300B/yr. The US also has plenty of downstream
| processing after production
| (https://www.eia.gov/dnav/pet/pet_pnp_unc_dcu_nus_m.htm),
| which means that total annual revenue must be significantly
| greater than this.
| forgetfreeman wrote:
| Point of Order: there was very little in good faith with the
| offshoring of manufacturing either in the domestic propaganda
| produced to drum up support for the initiative or the
| intention to dominate Chinese society with western
| consumerism.
| chii wrote:
| > All the while Beijing did everything in its power to enrich
| the Chinese worker
|
| i am not sure that the CCP is doing anything to enrich the
| average worker, and in fact, is probably doing the very
| opposite - making sure the chinese currency is constantly and
| artificially debased to make export more competitive. This
| results in lower wages for the workers. It is why there's low
| demand for goods/services in china.
|
| The money being earned by these exports is kept mostly by the
| gov't - to be spent on whatever they think has priority,
| which mostly have been on infrastructure, supporting industry
| the party deems important etc.
| bflesch wrote:
| If you think that autocratic regimes enrich the common
| workers, I have a bridge to sell to you.
| chengiz wrote:
| The oil industry is not larger. I believe oil and gas is not
| even a separately measured category so the numbers you're
| getting are probably including many sectors across the board
| and are quoted by some vested interest like the American
| Petroleum Institute.
| marcosdumay wrote:
| > It was our advantage to lose
|
| That's bullshit. China is more than 5 time larger than the
| US, so you really expect them to build fewer things than you
| forever?
| kayewiggin wrote:
| 1.) The article is from January 2024.
|
| 2.) Some of the data that it's based on is up to 2023. And some
| are up to 2020
|
| 3.) There has been massive movement of manufacturing out of
| China between 2020 and 2024. I won't provide the references
| here, as there are too many to mention, from
| Japanese/Taiwanese/South Korean/European/American companies.
| They are easily chatgpted/googled. Also the reason why Shenzhen
| and Guangzhou has suffered deeper drop of real estate price and
| employment.
|
| 4.) In 2024, Mexico was the biggest exporter to US. United
| States was the biggest exporter to Europe. US was the largest
| export destination of Japan.
|
| 5.) Trump's 60%-100% tariff on China will accelerate the exodus
| of manufacturing
| advael wrote:
| Again, I really don't feel qualified to weigh in on most of
| these matters, though I will say that I generally do prefer
| direct citations if you'd like me to take the epistemic
| credibility of a claim more seriously than any other thing
| someone on the internet said (in other words, saying "go look
| it up" provides no more additional credibility than simply
| making the statement, and is thus kind of pointless, and in
| fact you take a not insignificant epistemic credibility hit
| for my purposes by suggesting that asking an LLM for factual
| information should be taken as a reliable source)
|
| That said, it's interesting to see how the supply shocks of a
| global pandemic can shift these kinds of relationships. It
| doesn't surprise me that Mexico, being a huge source of food
| for the US, is the largest exporter to it. What I do wonder
| is how much exports pertain to manufacturing relationships.
| Like in the case of Mexico -> US, I think we wouldn't count
| e.g. stuff we buy for the produce section to be manufactured
| goods, but that would still count toward import/export
| numbers. Does this apply to other things too? Do things like
| IP count?
| kayewiggin wrote:
| Very comprehensive list of how China has lost export power
| to US over the years. Remember that US has the largest
| consumer market in the world, more than double the second
| place, EU. https://en.wikipedia.org/wiki/List_of_largest_co
| nsumer_marke...
|
| https://www.forbes.com/sites/kenroberts/2024/06/25/us-
| import...
|
| - Chinese imports into the United States are down 19.78%
| from April of 2018 -- when Trump first started imposing
| tariffs -- to today, or $31.88 billion.
|
| - Cell phones: Big winner is India. China has gone from a
| market share of 63.59% in 2018 to a still strong 42.14%.
| That's a decline of 33.73%.
|
| - Computers: Big winners are Taiwan, Vietnam. China has
| gone from a market share from 53.45% in the first four
| months of 2018 to 28.11%, a decline of 47.40%.
|
| - Furniture: Big winner is Vietnam. China, meanwhile,
| accounted for 23.55% this year, down from 48.54% in 2018, a
| decline of 51.49% compared to a gain of 88.67% for Vietnam.
|
| - TVs and monitors: Big winner is Vietnam. Mexico overtook
| China as the import leader in this category just before the
| pandemic and has remained on top. It gained market share
| from China, which fell from 53.68% in 2018, when it was No.
| 1, to 33.64%, a 37.32% decline.
|
| - Digital storage devices: Big winners are Korea, Vietnam.
| China accounted for 39.50% of those imports in 2018, more
| than double that of any other nation. In 2024, its
| percentage is 4.23% and it ranks No. 9.
|
| - Digital cameras: Yep, Vietnam again. China, meanwhile,
| has seen its share go from a majority, at 50.09%, to
| 17.57%, a decline of 64.92%.
| riku_iki wrote:
| > TVs and monitors: Big winner is Vietnam. Mexico
| overtook China as the import leader
|
| This doesn't make sense to me, do they do some high level
| assembly of components? I think China took over global
| market of TV panels manufacturing for example:
|
| _With this transaction, Chinese manufacturers' market
| share of the LCD panels used in TVs will increase from
| 66% to 72%, with nearly 100% share in ultra-large 90 -
| 115 inch screens.
|
| The market share of Chinese OLED panel manufacturers is
| forecasted to increase from 47.9% this year to 50.2% next
| year, surpassing the OLED shipment share of Korean
| companies._
|
| https://www.forbes.com/sites/willyshih/2024/10/13/chinese
| -ma...
|
| It sounds like it could be that China losing in cheap
| assembling tasks, but significantly gaining in high tech
| manufacturing.
| travisporter wrote:
| That sense to be possible thesis esp given a comment
| earlier about china effectively laundering some goods to
| countries with deficits to china
| maxglute wrote:
| Gross production is sales $$$, it's not actual output of
| widgets. I imagine if measure gross production by some units of
| stuff made, PRC would be far ahead.
| baxtr wrote:
| Maybe true. But how do you get quality into the equation.
|
| Is all the garbage on temu/shein also part of the gross
| production KPI? I couldn't care less about these cheap
| plastic widgets.
| maxglute wrote:
| Some don't, but many do. Does a 600k NVIDIA AI rack provide
| as much value as 600k worth of commodity solar panels, or
| 10,000 entry level mopeds? Most of the world (developing)
| benefits more from commodity widgets.
| baxtr wrote:
| Fair. But isn't that exactly what money is there for?
|
| You can objectively compare the value (to the world in
| this case) of two very different set of items.
| deepsun wrote:
| Yes, but $$$ is the currently the most accurate metric of
| "units of stuff" by their usefulness. At least there's no
| other widely used metric. So $$$ is the most correct way to
| measure the output.
| maxglute wrote:
| I think it's just the simplest (also default*) way of
| measuring, which doesn't mean it most correct or accurate.
| If PRC makes 5 cars @10k for every 1 US car @50k , and each
| PRC car is 80% as good, which metric do you use to measure
| gross manufacturing. Most people would say the guy that
| makes 5 cars. They might say the guy that makes 1 car if
| the 5 car guy's cars were 10% as good. What if its 3 cars
| that is just as good as 1 car charged at 3x. Across the
| board you have made in America stuff that's a little to a
| lot better (or worse) than PRC stuff, but cost 2-5x more.
|
| * by default I mean, these metrics/calculations are
| downstream of national accounting methods, i.e. most of
| world standardized on UN SNA which measures "value" as in
| $$$ vs something like (deprecated) soviet material
| production system (MPS) that measures physical material
| widgets produced.
|
| One proxy metric is PRC container throughput of her ports
| last year was ~300 million TEU vs US is about ~60 million
| TEU (with slightly higher ratio of empty containers).
| greggyb wrote:
| The price (that consumers are willing to pay) is the only
| decent proxy for quality we have. Quality, of course,
| includes consumers' preferences.
|
| If the one car sells at a market price of 1/5 of another,
| then the only reasonable conclusion is that, as judged by
| consumers, one car _is_ worth 5x as much as the other,
| and therefore _is_ 5x better.
|
| That's what market prices are: the collective valuation
| of goods/services and their alternatives. Of course, the
| market clears at a price that is a combination (you can
| think of "average", but that arithmetic is not the
| process by which prices are discovered) of the
| preferences of all consumers in the market.
|
| If you have a preference that goes counter to the market,
| e.g., if you do _not_ think those two cars are 5x
| different in quality, then there is a great deal for you!
|
| If you think the worse car is only 2/5 the quality
| (rather than 1/5), then you can get something for half
| the price you'd be willing to pay if the rest of the
| market agreed with your preference.
|
| If, on the other hand, you think the better car is 10x
| the quality of the worse car, then the same "deal" is
| true for you. You'd be willing to pay 10x the cost, but
| you only have to pay 5x the cost.
|
| There are plenty of good macro and micro econ courses
| available for free if you'd like to dig into this sort of
| thing more.
| mcmcmc wrote:
| As with anything it's useful in context, but it does discount
| the labor force advantage China has in pure population numbers.
| Hilift wrote:
| Some manufacturing is down. Look at the state of sophisticated
| shipbuilding.
|
| The US Navy has stated numerous times that the US essentially
| has minimal capacity. Maintenance and construction are years
| behind schedule. It isn't about funding. 40% of attack
| submarines aren't fit for service or deployable. The new
| Columbia class submarine will use a new steam turbine. Northrup
| Grumman was selected for the manufacture of the steam turbine
| in 2014. It isn't ready yet.
|
| Sophisticated manufacturing is in crisis in the US. It's the
| reason that the US bigfooted France in the AUKUS submarine
| deal. To revive a failing industry.
|
| These are interesting tests due to there are restrictions on
| sourcing of parts and personnel for a project.
|
| https://news.usni.org/2024/04/10/late-turbines-have-major-im...
|
| https://news.usni.org/2024/04/10/late-turbines-have-major-im...
| manishader wrote:
| There is also the USS Zumwalt type problem.
|
| We spent $22.5 billion to get two active.
|
| Imagine what $22.5 billion USD buys in Chinese manufacturing
| capacity.
| slaw wrote:
| $22.5 billion would be 2 million Teslas Y, but from BYD.
| defrost wrote:
| Six nations manufacture at least 3% of the world total.
| China is followed by the US, Japan, Germany, India, and South
| Korea. Note how the world has changed. Only three of
| these are long-established industrial economies; the other three
| are newly industrialised economies. Four of the G7
| don't make the cut.
|
| s/ 3% / 63% /
| anovikov wrote:
| It's not surprising: everyone is using the same manufacturing
| equipment now, due to free markets and trade. So it's only
| about numbers of workers.
| defrost wrote:
| Port capacity and equipment scale, willingness to engage in
| toxic processing, etc carry far more weight, IMHO.
|
| China has a lock on various electronic production streams by
| having a lock on _most_ of the rare earth processing and
| dealing with the low level radioactive waste by products.
|
| One billion tonnes of raw iron ore per year flows from my
| state of Western Australia to China for steel production -
| the machinery, diggers, haul paks, massive trains, et al make
| that happen in a state with a population of only ~2.3 million
| or so with few of those in mining. 16x peak US iron ore
| production for steel with a workforce smaller than the US's
| at it's peak.
|
| China didn't just fall into peak manufacturing capacity by a
| happy accident of many workers, they (for better or worse)
| made long term plans and stuck at them - including the
| _reduction_ in population growth known as the one child
| policy.
|
| Current Chinese pharma production is a truly bespoke behemoth
| - it has a massive capacity that can easily make small to
| order amounts, and again that's due to factors such as
| education and well automated pipelines.
| seanmcdirmid wrote:
| > China didn't just fall into peak manufacturing capacity
| by a happy accident of many workers, they (for better or
| worse) made long term plans and stuck at them - including
| the reduction in poulation growth known as the one child
| policy.
|
| I don't think China planned to intentionally fall off of a
| demographic cliff. But they are already planning for that
| cliff by making very aggressive investments in AI and
| automation. If you see how effective their plans from 10-20
| years ago turned out today, wait another 10-20 years
| and...I hope we have some kind of a plan...it isn't what
| Trump has in mind for sure.
|
| Ironically, Japan planned for the same cliff with
| aggressive investments in AI and automation in the 1980s,
| but the rise of China messed that up with cheap labor, and
| their AI play was misguided/probably too early.
| fakedang wrote:
| I can't help but say that Australia is basically the
| stupidest country on the planet (at least amongst Western
| democracies, since one could say modern Russia is stupider,
| but that's a whole another cultural debate). It's like the
| degenerate alcoholic who's willing to prostitute their
| mother for a bar tab. A country so blessed with some of the
| most important natural resources, a country whose geography
| is synonymous with the word abundance. But nah, they'd
| rather sell themselves out to the biggest foreign bidder,
| even if they are from their biggest regional rivals. While
| Norway and the UAE enjoy the fruits of their resources
| through strong welfare systems enabled by a resource-driven
| economy a fraction of Australia's, Australia sold itself so
| hard its own citizens have to buy from foreign corpos.
| defrost wrote:
| > Australia is basically the stupidest country on the
| planet
|
| Too right.
|
| > It's like the degenerate alcoholic who's willing to
| prostitute their mother for a bar tab.
|
| Ahh, so you _are_ Australian then.
|
| > even if they are from their biggest regional rivals.
|
| How is China a regional _rival_? Australia has koalas,
| China has Pandas.
|
| > While Norway and the UAE enjoy the fruits of their
| resources through strong welfare systems enabled by a
| resource-driven economy
|
| Australia also has welfare, high living standards, high
| life expectancy, good health, etc.
|
| > Australia sold itself so hard its own citizens have to
| buy from foreign corpos.
|
| Ahhh, so Norway and UAE have their own home built
| computers, TV's, and EV's, etc then?
|
| You have some points, but you're trying to edge lord a
| bit hard there mate.
| fakedang wrote:
| > Australia also has welfare, high living standards, high
| life expectancy, good health, etc.
|
| Tell me how affordable a home near the workplace is for
| most Australians? On the contrary, Norwegians and
| Emiratis get a huge housing subsidy for their first
| homes. They both use their oil revenues to push for
| sustainable energy sources at home. And the UAE is
| currently pulling over its weight in AI, funding a
| significant AI player, while also taking part in active
| space exploration.
|
| > Ahhh, so Norway and UAE have their own home built
| computers, TV's, and EV's, etc then?
|
| Building computers, EVs and TVs in this age when China
| controls the complete manufacturing chain is a bit stupid
| honestly. But they do have manufacturing bases on the
| things they actually excel at - Norway is a major player
| in manufacturing shipping and specialized O&G equipment,
| while the UAE has focused on aircraft parts manufacturing
| and defence manufacturing.
| MaxPock wrote:
| Do you have another market for them where they can sell 1
| billion tons of iron ore a year ?
| creato wrote:
| They could process it themselves and consume or export
| those higher value materials
| defrost wrote:
| See: https://news.ycombinator.com/item?id=42593404
|
| Australia itself doesn't have the demand for that much
| steel internally - China does (and exports its excess
| production).
| grecy wrote:
| > _and exports its excess production_
|
| Which is exactly what Australia could do if it made a
| bunch of steel.
| bigfatkitten wrote:
| > China does (and exports its excess production).
|
| With no small amount of it exported to Australia.
| fakedang wrote:
| Saudi Aramco has a $50 billion dollar subsidiary called
| SABIC whose purpose is to take oil byproducts and refine
| them into plastics. Does Saudi Arabia have a huge plastic
| market? Or did they just think, hey, we could export this
| shit elsewhere for more money!
|
| You literally let an Australian company process it to
| higher value products and ship it? That's literally what
| every oil major has done with their resources.
| maxglute wrote:
| AU exported ~1.5-2 trillion (lazy chatgpt math) worth of
| iron ore to PRC in last 20 years... which is life
| changing sovereign fund size, for Norway (also ~2T), with
| 5 million people. Or UAE 1 million emraties. Qatar with
| 300k Qataries. Much less so for 25m OZs. Doesn't mean
| they haven't squandered what they have, but just to put
| scale in perspective.
|
| Not to mention PRC steel employs like 3m people, about
| the entire population of western australia where all the
| iron ore is. Unless AU dumped 1/5 of their entire
| workforce, relocate millions of workers and families,
| they can't make enough finished steel products to fill
| PRC appetite. I think much easier and profitable for AU
| to double down on ore extraction and ship more $$$ than
| finished steel. That's where AU competitive advantage is.
| Otherwise buyers will look elsewhere, i.e. Brazil could
| have been expanding iron ore exports much sooner.
| fakedang wrote:
| Like I mentioned in another comment, you create
| manufacturing companies in your home turf to refine those
| raw materials into higher value products, which is
| exactly what Norway, the UAE and Saudi Arabia have done
| (Qatar cant exactly do that because their resource is
| basically just gas). Companies like Aramco, SABIC, ADNOC
| and Statoil exist. I don't see any of those countries
| inviting Adani or Yuxiao to extract their material for
| them. Yet China is a major customer for all of them, as
| they all are for China (Norway maybe less so).
| grecy wrote:
| FWIW, I'm an Aussie who went back during covid for the
| first meaningful stretch in 20 years. Explored the who
| country.
|
| I saw with my own eyes what you're talking about and you
| are spot on. It's depressing and sad to see how Australia
| can't organize a free one in a brothel, is stuck in the
| past and has no real interest or plan on how to improve
| anything at all.
|
| Their problem is life is pretty good, so they're not
| interested in a bit of work to make it incredible. Like
| you said, a modest sovereign wealth fund could easily let
| every Aussie work 4 or even 3 days a week. Or more solar,
| or making use of all the uranium or one of dozens of
| things
| bigfatkitten wrote:
| David Horne said it best in 1964.
|
| "Australia is a lucky country run mainly by second rate
| people who share its luck. It lives on other people's
| ideas, and, although its ordinary people are adaptable,
| most of its leaders (in all fields) so lack curiosity
| about the events that surround them that they are often
| taken by surprise."
| grecy wrote:
| Thanks, I've never seen that quote. 100% spot on.
|
| Sadly as true today as it apparently was back then.
| fakedang wrote:
| That's such a beautifully relevant quote.
| fakedang wrote:
| It's what they call the resource curse, something that
| has plagued Norway too, but at least in Norway's case,
| they have opted to do it in a way that sustains it for
| the future. Compared to the Swedish and Danish, the
| Norwegians are also considered lazy for the same reason -
| life is good, so why bother with ambition?
| elashri wrote:
| The title needs 2024. The article is almost a year old.
| Animats wrote:
| The US can't even make cell phones any more.
|
| What would it take to get that capability back?
| echelon wrote:
| Moving it to Mexico, Vietnam, and India.
|
| Mexico is ideal since you can ship partially assembled goods
| via truck or rail to and from Texas. It's easy to manage
| logistics and partnerships due to the close proximity.
|
| The future of the US is Mexico.
|
| Vietnam and India can absorb SEA manufacturing.
| coliveira wrote:
| Mexico is now a hub for Chinese manufacturers. Just look at
| how they're developing the relationship: the materials are
| all from China and the market is the US. Vietnam is even more
| like that.
| jimt1234 wrote:
| A friend of mine has done logistics for years, getting raw
| materials (sheet metal) into Mexico, manufacturing the
| products there (mostly kitchen appliances), and shipping to
| the US. According to her, it's nearly impossible to make any
| significant progress in Mexico because there's so much
| corruption at all levels. She has to ship metal from Asia to
| Long Beach, then have it trucked down to Baja where it gets
| made into a product, then the product gets shipped back to
| the US for sale. Every couple of years there's talk of
| scaling up the ports at Ensenada so the shipments of metals
| can go directly to Mexico, but it never happens - locals get
| paid off, and nothing ever happens. I once asked how the
| Mexican officials can be so corrupt, that they would sabotage
| their own port improvements. She told me, "I wasn't talking
| about corrupt Mexicans. Do you think Long Beach is just gonna
| sit back and let the Ensenda take shipments from them?"
| dragonwriter wrote:
| The US _can_ make cellphones, its just not efficient for the US
| to make cellphones because the US's comparative advantage is
| elsewhere.
|
| What it would take for the US to make cellphones is direct
| subsidy to the (inefficient, and for that reason likely
| therefore doomed by the market without artificial support,
| since there is robust competition) US firms doing so.
|
| Of course, not only would this cost the amount of the subsidy,
| but the amount of the lost opportunities in places where the US
| _has_ comparative advantages foregone to provide the subsidy.
|
| The question then is _why_ would you want to do this?
| Dalewyn wrote:
| >its just not efficient
|
| The problem is we don't need _efficiency_ , we need
| _effectivity_.
|
| >The question then is why would you want to do this?
|
| Because _He Who Makes Leads The World_. You can 't and won't
| lead if you don't actually get your hands dirty and _make_
| shit. China is the world leading superpower now because they
| make _everyone 's_ shit, we are all beholden to them.
| coliveira wrote:
| Producing real things is not just a matter of money. You need
| know-how and supply chains. These things left the US at least
| 10 years ago. It can get them back, but the costs will be
| staggering, and it would need to compete against China and
| other Asian countries.
| rat87 wrote:
| Many of those Asian countries are our allies. If you want
| to argue for weapon or dual use stuff like drones that's
| one thing but I don't see how making cellphones help. Also
| we do make real things both physical and non physical
| coliveira wrote:
| I think you're deceiving yourself. They're allies as long
| as it makes sense for them.
| tokioyoyo wrote:
| As the last 15 years has shown, being ally only works
| until US decides to choose themselves first. Even weird
| comments about Canada's independence can sway
| population's perception. There are genuine conversations
| about "maybe we shouldn't have severed our ties with
| China" on the ground nowadays.
| tivert wrote:
| >> The US can't even make cell phones any more.
|
| >> What would it take to get that capability back?
|
| > The question then is why would you want to do this?
|
| National security, obviously. Cell phones are a critical
| modern communication device, and whoever though it was a good
| idea to outsource that kind of thing political and economic
| rival was an idiot.
|
| There's all kinds of accounts of past CIA/NSA daring-do where
| they used US-manufactured products to subvert rivals, and now
| we're going to get to be on the other end of that kind of
| thing.
|
| Then there's the adding factor of it being kind of a good
| idea to have significant manufacturing capacity for the full-
| range of modern products located domestically or with allies
| in case the geopolitical SHTF.
|
| You know, all that important stuff the market doesn't give a
| shit about, because it's a limited and imperfect system.
| fvdessen wrote:
| It's not economically optimal for one country to manufacture
| all the jewelry and its neighbour all the tanks, because this
| situation quickly becomes one country
| chii wrote:
| > because this situation quickly becomes one country
|
| i would argue this to be a good thing - a global "country".
| And yet, it is the human condition to separate tribally.
| It's why civilization can't advance more, until this
| becomes solved.
| whimsicalism wrote:
| good thing we have more than two countries. in history, the
| jewelers generally tend to win because they just pay off
| some other tank building country - see Kuwait, for instance
| linotype wrote:
| It's easy, just make Americans poor enough that it makes sense
| to manufacture them here. Given that no one wants to pay more
| taxes or (realistically) cut spending, we're well on our way.
| whimsicalism wrote:
| +1, it's truly like there are no adults at the helm any
| more.. nobody even talking about our fiscal path and that we
| need to raise taxes and scale back medicare/ss
| saturn8601 wrote:
| They are trying:
|
| Purism is selling the Librem 5 USA at $1,600
|
| From the site: "The Librem 5 USA has Made in USA Electronics
| with all fabrication and manufacturing done at the Purism
| facility. Individual components used in fabrication are sourced
| direct from chip makers and parts distributors. We use US
| companies with US fabrication whenever possible. Most
| distributors are based in the US with the exception of large
| integrated circuits that are made in a variety of countries
| where those companies do fabrication (US, Taiwan, South Korea,
| Japan); an example is the NXP CPU we use from their fabrication
| in South Korea. While we source chips that are made in the US
| whenever possible, chip country of origin is not nearly as
| meaningful as country of board fabrication, especially when all
| chips are verified hardware circuits that are driven by free
| software in the kernel."
|
| [1]: https://puri.sm/products/librem-5-usa/#table-of-origin
|
| If you look at the table on the site, its not 100% USA yet but
| they are getting close and thats a positive development.
| renewiltord wrote:
| Usually a lot of "I would pay for a phone if it were made in
| the USA" people disappear once "here's a phone made in the
| USA" actually shows up. It's usually just bullshit.
| 2OEH8eoCRo0 wrote:
| Is that because of US inefficiencies or that they can't
| subsidize the cost with spying? Both?
| gruez wrote:
| >or that they can't subsidize the cost with spying?
|
| There's no evidence CCP is "subsidizing the cost with
| spying" when it comes to consumer electronics. Even when it
| came to telecom gear (during 5G rollout in developed
| countries), concerns were mostly theoretical.
| 2OEH8eoCRo0 wrote:
| I didn't mean the CCP and by spying I meant harvesting
| user data for ads. We were talking about why a US built
| phone is so expensive (Librem) compared to say Samsung,
| LG, etc. Are companies that aren't Purism offsetting
| their cost by harvesting juicy user data?
| tokioyoyo wrote:
| It's just going to be another Anom-style honeypot in the end,
| isn't it?
| gruez wrote:
| >Purism is selling the Librem 5 USA at $1,600
|
| That's actually worse than it seems on the surface. $1,600
| might seem only twice as expensive as a "normal" phone (eg.
| iPhone 16, $799), but if you look at the specs it's much
| closer to a low-end phone that sells for >$100. For instance
| the redmi a3[1] sells for ~$75 and is better in every aspect
| CPU, GPU, display, memory, storage, battery.
|
| [1] https://www.gsmarena.com/xiaomi_redmi_a3-12822.php
| est wrote:
| Send your kids to study EE, invest 401k in manufacturing
| devmunchies wrote:
| I think it's less capability and more the cost of goods. You
| can't compete with items that are half the cost to produce in
| east asia.
|
| Manufacturing was always going to move to where it costs less.
|
| It's bad for a productive american economy but it's a
| prisoner's dilemma so you can't blame businesses or consumers.
|
| The government is the only party that had the power to do
| anything. it's 100% an economics problem.
| myflash13 wrote:
| > The US is the world's sole military superpower. It spends more
| on its military than the ten next highest spending countries
| combined.
|
| Dubious claim. Military power is not measured in "spending".
| Manufacturing is in fact a basis for modern military power, as it
| was the basis for US military power in WW2. The fact that China
| can produce 10k+ precisely controlled drone swarms in massive
| quantities and produces more hypersonic missiles and ships casts
| doubt on this claim.
|
| Says the Atlantic:
| https://www.theatlantic.com/politics/archive/2024/12/weapons...
| echelon wrote:
| It won't take long for China to catch up. And in a hot war,
| they're the ones who can rapidly rebuild.
|
| Lots of reports say that Chinese military spending has exceeded
| our own if you account for their cheaper cost of labor and
| material goods.
|
| China also recently (just days ago) flew two new sixth gen
| fighters. The US has yet to demonstrate one.
|
| The tactical move for the West to counter is to move as much
| manufacturing as possible to other countries (Vietnam, India,
| Mexico) and hope that can put a dent in China's manufacturing
| flywheel. The Chinese consumer economy isn't robust enough to
| absorb all of the goods they manufacture (at least not yet),
| and without buyers the system would need to be scaled back.
|
| Even if China was 100% a friend, you wouldn't want one country
| with this much outsized control over manufacturing. In the
| future this will be better distributed.
| klipklop wrote:
| The irony is in a world war China would likely take over the
| manufacturing plants the west built in places like Thailand
| and Vietnam to assist China in the war effort. Further
| bolstering their war time production.
| coliveira wrote:
| Let's not even talk about Taiwan, which will be the first
| target, and its plants will all produce chips for Chinese
| products.
| wumeow wrote:
| Those plants will 100% be destroyed/disabled in the event
| of an invasion.
| seanmcdirmid wrote:
| Those plants depend on a lot of imports for spare parts
| and raw materials, even if China took them over tomorrow
| somehow intact with with the people to operate them, they
| would be out of commission in a month or so.
| okasaki wrote:
| They say that but it doesn't really make sense to
| actually do it.
| coliveira wrote:
| Even if that is possible (unlikely), it will be a big
| blow to American power because Taiwan produces the best
| of semiconductor technology.
| rat87 wrote:
| Invading Thailand and Vietnam would likely lead to a
| military alliance of them US, Japan, the Philippines,
| Australia and possibly South Korea. If they just want
| Taiwan at least for now it seems like a bad idea to get all
| the other countries to enter the war
| aurareturn wrote:
| >manufacturing plants the west built in places like
| Thailand and Vietnam
|
| What are these?
| fragmede wrote:
| Apple https://asiamattersforamerica.org/articles/apple-
| exploring-m...
| aurareturn wrote:
| Did Apple build these factories?
| Mistletoe wrote:
| Can we even talk about a world war like this in the nuclear
| era? Wouldn't we all just annihilate each other with
| nuclear weapons if we had a full fledged war?
| marcosdumay wrote:
| The more time Russia spends in Ukraine, the more evidence
| we get that no, we won't _just_ annihilate each other. We
| will probably do something more complex.
| coliveira wrote:
| > Even if China was 100% a friend, you wouldn't want one
| country with this much outsized control over manufacturing
|
| It's not up to the US to decide this. China is the largest
| car market. It is also the largest car producing country. It
| is the largest manufacturing country. It also has the largest
| number of consumers in any country, and this market is still
| growing. It has the largest number of engineers. The numbers
| play in China's favor.
| pm90 wrote:
| Certainly. The reality of the political situation though is
| that China is an authoritarian country ruled by the PRC,
| increasingly acting more like a dictatorship. While China's
| economy, society and people have 100% the right to grow as
| much as they would like, those of us living in (sonewhat)
| liberal democracies would still want to contain the power
| of the PRC (and the cult of Xi Jinping).
| tomohelix wrote:
| > liberal democracies would still want to contain the
| power of the PRC (and the cult of Xi Jinping)
|
| I am not Chinese but I still find this comment
| hilariously offensive and tone-deaf. I can say almost
| without a doubt that the US has a "tremendous" issue with
| cult-of-personality right now. But I don't see Chinese or
| other countries attacking or trying to "contain" this.
|
| The US is still treated as a nation, unified in its
| people and leaders, by even its adversaries. But when
| Americans deal with other countries, there is a tendency
| to say things to the effect of: "the people are fine, it
| is the X that must be suppressed", ignoring that this X
| is inherently or directly connected to people of this
| nation.
| jhanschoo wrote:
| Your comment immediately reminded of this Reuters story
| yesterday: "Supporters of South Korea's Yoon adopt 'Stop
| the Steal', hope Trump will help"
| https://www.reuters.com/world/supporters-south-koreas-
| yoon-a...
| coliveira wrote:
| Most Americans are incapable of seeing the double
| standards of their own culture. Unfortunately for them,
| the rest of the world is well aware of this.
| manishader wrote:
| If 1989 had gone in a different direction and China today
| is just a giant version of Taiwan, how would that
| possibly be better as an American? We would all be trying
| to figure out how to get paid in digital Yuan.
|
| Instead they have huge manufacturing capacity sitting on
| top of a completely busted financial system. Look at the
| returns of Chinese equities vs GDP growth the last 20
| years. It is completely absurd.
|
| The financial system is imploding right now, trying to
| find a place to hide
| https://tradingeconomics.com/china/government-bond-yield
| kelipso wrote:
| > returns of Chinese equities
|
| Another phrase for money leaving the country without
| goods coming in?
| coliveira wrote:
| > returns of Chinese equities vs GDP growth
|
| The equity market is just one place where companies can
| go to receive investment. In China this is a small part
| of total investment pool. So, no surprise that these
| equities don't go as fast as the rest of the economy,
| there is a lot of competition. In the US this is the
| reverse because traded companies are allowed to swallow
| more and more of the real economy.
| tim333 wrote:
| The US can have a big effect with policies supporting local
| / non Chinese manufacturing with tariffs, subsidies and the
| like, as they are already doing.
| jandrewrogers wrote:
| > China also recently (just days ago) flew two new sixth gen
| fighters.
|
| China doesn't really have a 5th generation fighter yet, it is
| more a roadmap item than a finished product. There is zero
| evidence they have 6th generation systems. These terms have
| meaning. The US has been flying 6th generation prototypes for
| years, they just don't post photographs. The US has been
| flying production 5th generation fighters for 20 years. They
| have a long lead and it isn't like they stopped development.
|
| Also, appearances are largely immaterial to being classified
| as 5th or 6th generation. Most of the relevant properties for
| classification are not casually observable.
| wakawaka28 wrote:
| Indeed, we spend more than anyone else but also get less for
| our money than anyone else. It would likely be an underestimate
| to say that our gear and labor costs double that of any of our
| competition.
| randomname93857 wrote:
| labor cost contributes to higher prices, but why we always
| ignore corporate America and middlemen contributions to price
| gauging?
| wakawaka28 wrote:
| Some middlemen are critical. I used to be more skeptical of
| "mere merchants" but they often take significant risks to
| supply us with things we need at exactly the time we need
| them and not a moment before. They provide a service to you
| by efficiently getting products into your hands, and they
| provide a service to the producers by handling all the
| logistics of distribution. _Some_ middlemen don 't add
| significant value, such as drop shippers (IMO). But even
| they might be seen as providing some value, such as making
| it more convenient for you to buy and assuming risks on
| your behalf.
|
| People don't ever ignore corporate America's actual price
| gouging. I think they are sometimes conditioned to see
| price gouging where there is none. Domestic costs are very
| high, and foreign costs are low (perhaps even suspiciously
| low; our competition is willing to operate at a loss to put
| us out of business). Don't get me wrong, it would be
| awesome if there was some obvious price gouging at work
| that could be cut to solve all our problems. But it is
| usually just market forces that drive prices high.
| gorgoiler wrote:
| I bought two things recently: some temperature sensors for a
| smart home and some cable clips to hide some wiring under a
| cabinet.
|
| Both were mass produced in China and both shipped with 3M branded
| adhesive mounting pads. An apt and literal representation of
| global manufacturing -- US made chemicals, Chinese electronics,
| one clinging to the other.
| coverband wrote:
| If one assumes that those 3M strips are authentic branding... I
| haven't come across a single tape that offered the expected
| brand quality.
| pjbk wrote:
| When I visited China some years ago "3N" was also popular.
| Same logo font and color, but at least they tried to avoid
| blatantly infringing the genuine brand.
| greggyb wrote:
| I imagine most courts in the US would, in fact, find "3N"
| as blatantly infringing the 3M trademark.
| csomar wrote:
| One thing people are not aware of and am curious of how big it
| really is: China manufacturing laundry. Essentially, goods are
| manufactured in China, then laundered to a third-party country
| and then exported to the US/EU. This come in two flavors, legal
| laundry where the local manufacturer satisfies the conditions;
| and illegal one where bribes are paid to pass goods.
|
| > https://antidumping.vn/eu-chinabike-duty-hits-indonesia-mala...
|
| I come from a country that does this. Massive deficit with China
| vs. an equivalent surplus with the EU. Weak manufacturing base
| that essentially import Chinese, does some packaging and then
| export it back.
| mylastattempt wrote:
| This way of working is marketed as such by Chinese
| manufacturers. They will refer to it as something along the
| lines of: Made in South East Asia. Sometimes they produce the
| products in (e.g.) Vietnam, but more often than not, everything
| is done in China, then shipped to Vietnam for packaging or
| adding a "Made in Vietnam" label, and shipped out from there.
| Thailand is another upcoming player in this scheme.
|
| Large companies are well aware of this and happily use their
| existing Chinese suppliers' SEA entity to avoid sanctions and
| tarrifs, or to show that they are moving away from having
| everything Made in China.
|
| To be fair, only gullible or naive people could truly believe
| that products coming from any part of Asia are not made,
| controlled, or otherwise influcnced by the Chinese.
| lukan wrote:
| "or otherwise influcnced by the Chinese"
|
| That last statement makes it almost meaningless. Then you can
| also say, no product on this world was made without US
| influence. Otherwise all those countries like Vietnam do have
| a agency of their own (Vietnam for example even succesfully
| fought china before with military)
|
| And south korea and Japan (and Taiwan) also are somewhat out
| of the direct control of china.
| csomar wrote:
| The country am from is neither in Asia nor influenced by
| China. People do it because there is money in doing it,
| simple as that. Chinese accept it (they sell low what other
| people sell high) because regulation/tariffs put them at a
| disadvantage and they just have to suck it up.
| trimethylpurine wrote:
| Do you work in manufacturing?
|
| In my experience, no, companies are generally _not_ aware and
| not accepting of this and brands /licensing requirements
| ensure that's the case. For sure in regards to valuable
| trademarks.
|
| A manufacturer would absolutely not want to risk their entire
| business. And that's all it takes for a brand to pull your
| license. Now what? Everyone is fired and a $120M contact is
| lost over a few cents per unit.
|
| It's possible that it happens as Chinese factories skirt the
| rules and make false presentation, but manufacturers spend a
| lot of money to send someone to many countries and factories
| to trial and vet them over the course of years to meet brand
| requirements for licensure before they begin manufacturing
| with them and often through repeat checks during the
| manufacturing process. But I'd say that's rare, again, in
| regards to branded goods of valuable trademarks.
| tivert wrote:
| > One thing people are not aware of and am curious of how big
| it really is: China manufacturing laundry. Essentially, goods
| are manufactured in China, then laundered to a third-party
| country and then exported to the US/EU.
|
| IIRC, a lot of stuff that's labeled "Made in Singapore" is/was
| basically that.
| doppp wrote:
| As a Singaporean, I have not seen this. Do you have any
| proof?
| fooker wrote:
| Look around from a rooftop, do you see many factories with
| smoke coming out of chimneys?
| bluGill wrote:
| Most factoies don't have a chimney. electric powers them.
| csomar wrote:
| You'd be surprised. Look up Jurong Island.
| csomar wrote:
| Yes: https://maps.app.goo.gl/1ZDRiQdhr3Ngf5qP6
|
| I'd not be surprised if this activity is quite limited in
| Singapore given that they have been under a tight
| microscope lately. Money laundering used to be their
| business but now they are rich and make money
| "legitimately" and within the "international" framework.
| gruez wrote:
| To be fair, having an industrial district doesn't
| preclude tariff laundering either. If you're trying to
| pass chinese goods as singaporean, you'd want your
| address to be a factory, rather than an office in a
| business park somewhere. Even if that wasn't a
| consideration, at the very least you'd need warehouse
| space to repackage/reship goods, so you'd need to rent
| out a warehouse/factory anyways.
| whimsicalism wrote:
| frankly i don't really see many things at all that say "made
| in singapore"
| kayewiggin wrote:
| There's not too much fake origin stuff from Vietnam to US,
| which is the largest SEA country exporting to US.
|
| "However, new research from Harvard Business School and Duke
| University paints a more nuanced picture -- rerouting appears
| to be lower than is imagined.
|
| While trade rerouting through Vietnam does occur, its scale
| appears far smaller than previously thought. The study found
| that in 2021, about 16.1 per cent of Vietnamese exports to the
| US -- roughly US$15.5 billion -- could be classified as
| potential rerouting when analysed at the product level. But
| when the researchers examined individual firms -- tracking
| specific products flowing from China through Vietnam to the US
| -- the figure fell to just 1.8 per cent, or US$1.7 billion."
|
| https://fulcrum.sg/vietnam-china-and-rerouting-when-percepti...
| cman1444 wrote:
| What I wonder is:
|
| Of the items that are rerouted, does Vietnam (or other
| similar countries) tend to move up the value chain over time?
| Or do the supply chains just stay as they are.
|
| I suspect, possibly hopefully, that over time the "rerouting"
| countries would evolve from simple assembly/repackaging to
| sourcing more granular pieces of the manufacturing process
| from within their own borders. How fast that might happen is
| another question.
|
| If anyone has any sources on this I would love to read more
| about it, I'm just not sure how to find them.
| chvid wrote:
| One example is what you seem to refer to; a solar panel reading
| made in Vietnam - assembled in Vietnam but by a Chinese owned
| company with all Chinese components.
|
| Another example is the iPhone reading made in China with a
| dollar value of 400 but the true value add in China is much
| lower as all the IP, profit margins, and high value components
| belong somewhere else.
|
| This means that even though these numbers look very unbalanced
| it is still Western companies that make biggest part of the
| profit. (At least so far though things are clearly changing
| with Chinese companies are climbing up the value chain.)
| doctorpangloss wrote:
| People buy iPhones for their software, which is all made
| here. Otherwise all phones are black rectangles. The hardware
| isn't that important.
| riskyingo wrote:
| cool, so no other country except US should buy that crap
| Barrin92 wrote:
| it's the opposite. People buy iPhones and Apple products
| for the quality of their hardware and the cost of the
| devices themselves reflects this. Apple is one of the least
| software focused tech companies in the world. Everyone
| except for American teens obsessed with the colors of their
| chat bubbles uses WhatsApp, Telegram or FB Messenger and
| other completely platform independent apps. Nobody's ever
| bought an iphone for Apple Maps, everyone runs around with
| Google software on their phone.
| wiseowise wrote:
| > Nobody's ever bought an iphone for Apple Maps, everyone
| runs around with Google software on their phone.
|
| It is still running on Apple platform. I'm buying an
| iPhone, because I know that I'll get consistent Apple
| experience that is same across all of my devices, unlike
| zoo of Android + Windows/Linux.
| Barrin92 wrote:
| What does that mean? There's no consistent Apple
| experience across Spotify, Venmo, TikTok and Facebook.
| There's pretty consistent experiences _within these apps
| across devices_ , which is what people care about. Nobody
| cares about their operating system except for that one
| middle aged developer who loves that his apps look native
| on his macbook. But that's not why people buy phones.
| seanmcdirmid wrote:
| People buy phones for good stable experiences. I'm not
| sure how it was today, but it was a mess 10 years ago
| outside of iPhones, and some people would rather pay more
| for a phone than bother with something by that requires
| more involvement.
| wiseowise wrote:
| If that was the case, then Android would have bigger
| share in developed countries.
|
| > Nobody cares about their operating system except for
| that one middle aged developer who loves that his apps
| look native on his macbook.
|
| Nobody* cares.
|
| * - 34% desktop share and 15% worldwide.
| Barrin92 wrote:
| >If that was the case, then Android would have bigger
| share in developed countries.
|
| How does that follow? I'm saying people buy Apple
| products for their premium hardware, which rich consumers
| are more likely to do across all categories. If software
| mattered, Apple would be _losing_ customers across the
| board because people spend more and more time in non-
| Apple software. It 's the exact opposite of my claim.
|
| >* - 34% desktop share and 15% worldwide.
|
| I don't think you even understood what I said to be
| frank, I didn't argue Apple's marketshare, we are talking
| about where the value in their poduct is, I didn't argue
| that people dislike their products.
| drekipus wrote:
| [delayed]
| addicted wrote:
| This comment completely misunderstands why Apple software
| is important.
|
| To be clear, as an f'ing Linux user, the things that make
| Apple software good, which is consistency, lots of hand
| holding, and making it really hard to break things badly,
| are irrelevant to me.
|
| But it's highly relevant to the vast majority of iPhone
| users in the world.
| SalmoShalazar wrote:
| The hardware is extremely important...
| phkahler wrote:
| iPhone chips are made in Taiwan. The displays are certainly
| not made in the US although the glass might be.
| seanmcdirmid wrote:
| iPhone displays are most definitely made in South Korea.
| Some of the components are made in Japan as well, not much
| is made in the USA beyond the software stack (which you are
| also most definitely paying for since SWEs aren't cheap!).
| Also iPhones are made in SEZs (none of the components are
| tariffed in these zones), so they are tariffed when
| imported into China.
|
| I doubt Trump tariffs will be based on value add. It would
| be a logistical nightmare, and he doesn't strike me as
| someone who thinks too deeply about these things.
| ChumpGPT wrote:
| Both Canada and Mexico are guilty of this. For years they would
| import products and do some light assembly and label it as Made
| in Canada or Mexico. Since Canada gives China Most Favored
| Nation status, importers can avoid duties and export into the
| USA since there is a Free Trade Agreement(NAFTA). It took a
| while for US Customs to crack down on this but it finally did
| and they now pay very close attention to where the origin of
| the item was. Unfortunately it went on long enough to destroy
| many American industries. Canada and Mexico made 100's of
| billions of these schemes at the USA's expense.
| cipher_accompt wrote:
| Is the problem Canada and Mexico, or is it corporations and
| business elites exploiting loopholes and abusing the system?
| Manufacturing in Canada was destroyed by competition in
| China.
|
| The root issue is the unchecked market power of businesses
| and the complete lack of repercussions for corporations and
| business elites that destroy industries, social systems, and
| deplete natural resources--without accountability for long-
| term consequences.
| AnthonyMouse wrote:
| You could also make the opposite argument. If you want to
| manufacture things in the US, the real estate costs too
| much because of artificial housing scarcity, the tax system
| favors international supply chains over domestic ones, the
| regulatory environment favors large incumbents over
| small/new companies, etc. And if you make it disfavorable
| to manufacture things in the US, you create the incentive
| for corporations to do whatever they have to do to
| manufacture it somewhere else.
|
| Don't think of corporations as having agency. Think of them
| like beasts that have to be herded into the field where you
| want them. If all your cows are in the neighbor's field,
| it's not the cows that you should blame and yelling at the
| cows is not going to help you.
| cipher_accompt wrote:
| You're speaking my language. Incentive-based programming
| of behavior drives optimization for rewards. For example,
| giant anticompetitive firms dominating our economies
| create corporate environments that shape executives to
| prioritize short-term profits by exploiting their undue
| influence to inflate their own compensation. This
| behavior depletes natural wealth, sacrifices long-term
| opportunities to more competitive firms abroad, and even
| jeopardizes their companies' sustainability. Boeing and
| Intel are prime examples of how executives optimizing for
| short-term gains leave behind destructive long-term
| legacies.
|
| Governments, too, create regulatory, taxation, and
| broader economic frameworks that influence incentives and
| shape behavior.
| AnthonyMouse wrote:
| I feel like the biggest problems are legislative
| incompetence and corruption. You have people proposing
| laws without considering how people will respond to them,
| or choosing a "compromise" authored by the perpetrators
| of the original offense.
|
| People say things like "corporate profits are too high,
| we need to tax them more" but the actual reasons
| corporate profits are high are lax antitrust enforcement
| and regulatory capture and the proposed tax increase
| would apply predominantly to domestic businesses,
| increase the incentives for offshoring and create even
| more advantage for large international corporations. But
| tax increases are popular in Washington because then they
| get more money to transfer to cronies, so it keeps
| getting proposed as a "solution" instead of solving the
| actual problems.
| cipher_accompt wrote:
| I actually wrote an article that you might be interested
| in. It connects competition policy, market power, and
| social unrest. If you're interested, feel free to take a
| look -- I'd be happy to hear your thoughts.
| https://thecommongoodchronicles.substack.com/p/an-
| assassinat...
|
| Higher taxes for the absurdly rich/corporations could be
| a good start _if_ the money was put to good use, but
| taxes ultimately don 't solve the underlying issue.
|
| I agree that the core issue is antitrust policy -- and it
| doesn't have to be this way and wasn't always like this.
| After the Great Depression, antitrust enforcement ushered
| in an economic golden age during the 1950s and 60s,
| boosting prosperity across all socioeconomic groups and
| lifting lower-income groups the fastest by enhancing
| competition and preventing concentrations of market
| power.
|
| Later, regulators embraced 'trickle-down economics' and
| 'corporate efficiencies,' enabling the rise of giant
| firms that overpower governments and laws. This shift has
| led to historically low profits, stagnant growth,
| declining productivity, and soaring income inequality.
|
| Now the rules-based systems have been co-opted by these
| giant firms that exploit their market power to subvert
| democracy and shape laws to serve their interests (and
| further entrench their undue influence) at the expense of
| society.
| whimsicalism wrote:
| the real problem is this poorly planned effort to make the
| US a manufacturing nation via political fiat in the face of
| all reason rather than accepting economic realities about
| comparative advantage in manufacturing
| cipher_accompt wrote:
| The US was once a manufacturing powerhouse and, in
| theory, could become one again. Working-class people
| understandably want their jobs back, and you can't blame
| them for being taken in by false promises to bring those
| jobs back.
|
| But the harsh reality is that creating a regulatory,
| taxation, and broader economic landscape attractive to
| manufacturing would inevitably threaten elites and firms
| at the top of the economic hierarchy. While there's
| nothing wrong with that -- in fact, it's likely healthy
| for the economy -- it won't happen[1]. Those elites and
| anticompetitive firms abuse their undue influence to
| subvert democracy and shape laws in order to further
| entrench their market power.
|
| [1] Or more precisely, it won't happen soon. It's pretty
| clear that the era we're in is coming to an end but
| change will likely be slow unless there's a surprise
| shock to the system.
| ReptileMan wrote:
| My EU member country assembled chineese cars for a while. I was
| joking that it came in two parts - the car and the badge and
| they just glued them together here. From what I understood
| later it was close to the truth.
| nimish wrote:
| CKD/SKD is the legal version of this tactic. It's not new. It's
| a great way to get around tariffs though!
| DanielHB wrote:
| It is not much different from all the European, US and Japan
| car companies do in Brazil. Brazil has high tariffs (for pretty
| much everything imported) so companies set up local factories
| to make the goods. Thing is those factories are not factories,
| they are assembly lines, minimal amount of engineering or even
| manufacturing happens there. The only big difference is that
| those goods are kept internally in the Brazilian market, they
| are not re-exported out as far as I am aware.
|
| Apple also has a factory in Brazil that makes most (all?) of
| iphones and ipads sold in Brazil. Most appliances companies
| (Bosch, Eletrolux, etc) in the local market also do the same.
| maxglute wrote:
| One thing to note is PRC is the only country in the world whose
| manufacturing sector has every industrial category classified by
| the United Nations.
| mahirsaid wrote:
| this is amazing and filled with facts that i wish everyone
| arguing the point that china cant overtake U.S. in economy or
| world superpowers would read. The facts are there, there is not
| much hiding around the corner, all of the true indication is in
| front of us. Yes. the article states U.S. still holds the title
| for world superpower by military size and capabilities. That's
| not to say that china cant catch up in no time with U.S.
| military. That's if they decide to do so. i would ask does the
| Chinese republic need to invest heavy in this sector in order to
| grow? Clearly not from the facts. in fact that's the very same
| thing we should have been doing all along.The U.S. has spent
| enormous amount of capital to fund wars and foreign relational
| activities.
|
| China has a great way going about this. making friends with less
| developed countries that U.S. overlooked. China is looking for
| something specific. Just as U.S. is looking for something
| specific as well. To be totally honest I am not entirely sure
| what the U.S. is looking for when engaging with other countries,
| other than the same narrative for the fear of not having safety
| blah blah. This time that was spent on these adventures the U.S.
| cannot get back, while also injuring foreign relations.
|
| there is a clear sign that the U.S. government is confused and
| has a gun with no-where to aim. All the policies and efforts are
| accelerating the U.S. into deterioration. The U.S. has some
| strong sector for the sake of this reply i will mainly say that
| attacking the top tech firms and industries with regulation will
| only push them out to more favorable grounds give new room for
| industries to form in more favorable grounds other than U.S.. the
| solution must solve the problem that brought the solution to
| existence.
| smcl wrote:
| > everyone arguing the point that china cant overtake U.S. in
| economy
|
| Surely nobody halfway serious is arguing that. The faction
| about to take power in the USA is tilting at the "woke
| ideology" windmill, talks openly of deporting a big chunk of
| the workforce and does not seem to understand how tariffs work.
|
| Even if you ignore all that, China has 4-5x the population (for
| now!) and is by all measures has a highly developed, productive
| and growing economy. What argument can there possibly be in
| favour of China falling back, other than _maybe_ the
| aforementioned demographic issues.
| kasey_junk wrote:
| The demographic issue is the big one.
|
| But there are several others that show up in serious
| financial circles. Particularly the domestic fiscal policy
| around debt and investment, currency liberalization and
| entrepreneurial risk vs reward.
|
| The Chinese government is walking a very fine line with their
| private enterprise policies and it's not one that is well
| understood. But there is quite a bit of concern that if China
| gets more autocratic it may hinder further productivity and
| growth (right as the demographic issue hits in earnest).
| audunw wrote:
| Chinas total population isn't really that relevant for what
| their economy will end up looking like. China is essentially
| a handful of moderately wealthy coastal areas (perhaps
| comparable to USA in population but still far behind in
| GDP/capita) and a huge inland area of very poor people.
| There's not much reason to think all those 100s of millions
| of people will become as wealthy as the average American or
| European any time soon. It's not just demographics. Geography
| is a huge challenge as well. I don't know if China will "fall
| back". But stagnation seems very likely. If they backslide
| it'll probably be due to some political turmoil, like what
| happened in when the Soviet Union collapsed. Nearly
| impossible to predict. If you look at what's happening with
| regular people inside China, there does seem to be a sense
| that things are getting worse, not better. I have friends
| with family in China that said exactly that this New Year's
| Eve.. There's a _lot_ of incidents with people driving their
| cars into crowds of people as a revenge against society, and
| other similarly worrying signs. Many factories are being
| moved out of China. It might not be enough to show up on
| statistics yet, but it's a process that has undeniably
| started and will probably accelerate. China has a huge bet on
| batteries, EVs and solar panels to make up for what they're
| loosing. That's going really well right now. But I don't
| think it's a winning strategy long term. USA and EU seems to
| be wanting to protect their industries and on-shore or near-
| shore a lot of that stuff. The manufacturing of those things
| are highly automated. Eventually most of the materials will
| come from local recycling. China could get a very strong and
| balanced economy if they had a good strategy based on self
| sustainable local consumption, rather can just export. But I
| just don't see that they're taking that seriously. Most of
| the policies are still geared towards supporting /subsidising
| higher exports.
| mahirsaid wrote:
| This will balance its self out. One thing they have we
| don't is monopoly control they allow you to have monopoly
| if it serves well. we have that but we turn on monopolies
| when they get too big, they were already too big when they
| attached the name monopoly to the big players. i suspect if
| we look at data going back thirty years you will see the
| gap far bigger and now the gap is rather widening or
| growing with each end of the gap getting thicker. what i
| mean is, the poor were really really poor and now we can
| look at data and say that they are just poor with avenues
| of fixing that issues. They do have the economies within
| their country to fix poverty as its far more fruitful
| versus the U.S.. you either work in fast food or have a
| masters degree making $70,000. this isn't great considering
| the U.S. is a rich country
| Yeul wrote:
| This so much. If America was serious about fighting China
| they would be signing free trade agreements with Asian
| countries and investing money into Africa.
|
| Instead Trump is angrily tweeting about how he's going to
| make everyone pay. The racist isolationists are back in the
| halls of power.
| bobthepanda wrote:
| I don't think it's necessarily so clear that Chinese foreign
| policy has really paid off yet.
|
| Chinese loanmaking to foreign countries has mostly gone bust,
| with many loans basically in default. While it's true that
| Western development agencies were not lending to these
| projects, they mostly weren't doing so because they were
| doubtful of the business cases of said projects and the
| likelihood that the government could actually pay off the loan,
| and so now China is dealing with that.
|
| One of the most direct Chinese relationships is with Myanmar,
| which has not only gone to hell in a handbasket but now is a
| hotbed of criminal activity by Chinese organized crime
| abducting Chinese nationals to work in Myanmar. So that's not
| great either.
| ted_bunny wrote:
| It's been argued that if you observe actions and not words,
| default has always been the point of IMF loans. Have you read
| Confessions of an Economic Hitman?
| manishader wrote:
| If you can't tell Confessions of an Economic Hitman is a
| work of fiction I don't know what to tell you.
| PittleyDunkin wrote:
| You don't need to read the book to see the role the world
| bank plays in preserving worldwide power structures. The
| entire world can talk to each other outside the american
| media sphere, you know!
| whimsicalism wrote:
| I think that generally if you read the internal documents,
| most of the people behind IMF and other global development
| loans are operating in good faith and not simply puppets of
| the political agenda of the west. I think they showed clear
| overconfidence in their policy prescriptions, but not out
| of malice
| bobthepanda wrote:
| The IMF is by definition the lender of last resort, when
| banks and investors find a country so fiscally
| irresponsible that they cannot access reasonable funding.
| It is not exactly surprising that those kinds of basket
| case economies also fail when given IMF loans given that
| people predicted they were going to do that and stopped
| lending.
| PittleyDunkin wrote:
| > Chinese loanmaking to foreign countries has mostly gone
| bust, with many loans basically in default.
|
| As America (or the world bank/imf as a proxy for american
| capital) can attest, calling in these loans is a great way to
| make a lot of enemies.
| bilbo0s wrote:
| The problem in China's case, is that there's a lot of
| evidence that China doesn't even care whether or not it's
| paid back. One, the loans were given often in dollars.
| Which China found itself with a surplus of the past few
| decades. With no convenient way of ridding themselves of
| those dollars without significant pain, Chinese strategists
| hit on the brilliant plan of "loans". Two, and more
| importantly, the loans were used to finance Chinese
| influenced infrastructure projects.
|
| So for instance, most of the African loans financed things
| like ports, and roads, and bridges, and trains, etc. Well
| when you look at the map of the "where" and the "what",
| it's easy to see the "why". All these bridges, roads and
| trains lead to the ports. Sure, this allows African
| countries to move their resources, and sometimes even
| finished products manufactured in these nations, to ports
| for delivery to "international clients". (Read, "China").
| But tell me this, will the Africans own the freighters? No.
| The Africans will move massive amounts of products and
| resources to their ports, likely in the EAC, then China
| will pick up all that bounty and move it to China.
|
| Sounds a lot like "harvesting" doesn't it?
|
| There's one case where the Chinese definitely don't care
| whether the loan is repaid or not. They only care that all
| the bridges, roads and trains financed by the loan go to
| the ports. In fact, I don't know if the Africans realize
| it, but they'll be paying the Chinese _more_ than the value
| of the loan just by using the rail and roads. The entire
| infrastructure system they 've built only facilitates one
| thing, moving resources and products to the ports.
|
| Is it good for Africans? Absolutely. A much better deal
| than they used to get when the West and Russia used
| assassinations and proxy wars to ravage the place. But
| let's not pretend it's about helping Africa. It's, at root,
| about an extremely low risk method of helping China by
| "loaning" money to others.
| whimsicalism wrote:
| roads and bridges to ports are exactly what imf and world
| bank loan do too, for obvious reasons
|
| frankly this whole comment reads as historically less
| informed
| bilbo0s wrote:
| And how many world bank loans are given to, well, let's
| call them "less than stellar" African governments?
|
| All the Chinese needed for the infra loan projects to
| work were nations who couldn't access financing via other
| means. Now they've been doing it a while, even the
| nations that can access the financing have been dipping
| into that well. Sometimes it's just better terms.
| mahirsaid wrote:
| This would have been my response to the this ^ reply.
| They have capital to spare and also, what they're gaining
| from these countries in return more than justifies there
| loss in capital. the gain exclusive rights to ports and
| military presence. recently they made a an effort to
| include African countries as their allies. Concluding
| that they will allow African countries to retain control
| over there capital wand profits while allowing china to
| export their natural resources. this is attractive for
| African nations.
| nradov wrote:
| The World Bank and IMF generally don't (and can't) call in
| loans so I don't know what you're trying to say there.
| Sometimes what happens is shithole countries default on
| their debts and then whine about injustice when lenders
| refuse to extend the terms.
| mahirsaid wrote:
| Also don't forget U.S. debt to China. the picture is painted
| clear of who depends on who.
| Yeul wrote:
| Trump reminds me of a Star Wars quote
|
| "The more you tighten your grip, Tarkin, the more star systems
| will slip through your fingers"
|
| The reality is that China will not magically disappear and they
| have integrated themselves into the world economy.
| hnthrow90348765 wrote:
| >attacking the top tech firms and industries with regulation
| will only push them out to more favorable grounds give new room
| for industries to form in more favorable grounds other than U.S
|
| Let them go, someone else will step in. Yes it will be
| inefficient as someone else ramps up, but companies that are
| only here to repeatedly hold the country hostage to get out of
| sensible regulations are a threat to the population's security.
| China will eventually abuse its population to the breaking
| point.
| stefan_ wrote:
| What do you mean, Chinese foreign policy is an utter train
| wreck. All of their neighbors hate them.
| rkancv wrote:
| Yes, China engages diplomatically and financially with
| countries that the U.S. fought and then leaves. Since the
| withdrawal from Afghanistan of course China appeared instantly:
|
| https://www.wilsoncenter.org/blog-post/mining-influence-chin...
|
| Now the U.S. is fighting for minerals in Ukraine. Rare moment
| of truth by Senator Graham:
|
| https://responsiblestatecraft.org/lindsey-graham-ukraine/
|
| This of course could have been achieved diplomatically by
| cooling down the NATO tensions. But no, another proxy war must
| be fought that likely will be lost like Korea, Vietnam,
| Afghanistan, etc. The Chinese do not fight and profit from all
| of this.
| rm_-rf_slash wrote:
| Korea is not the best example to prove your point. SK is per
| capita equivalent to Japan[1]. The Korean War was a tie and
| in the long run it's clear which side is better off.
|
| [1] https://www.economist.com/graphic-detail/2022/02/01/by-
| one-m...
| bilbo0s wrote:
| Pretty sure the parent is talking about overlooked nations.
| Nations no one even fights a war over. Probably referring to
| things like China going "all in" on under-developed African
| nations.
|
| It's a very "Eastern" strategy. Avoidance and Trade.
| mahirsaid wrote:
| and now Russia (Russia takes step towards recognizing
| Afghanistan's Taliban government)
| https://www.reuters.com/world/russia-takes-step-towards-
| reco...
| bflesch wrote:
| You're showcasing the "false equivalence" fallacy - you're
| comparing apples to oranges.
|
| 1) Autocracies are fundamentally unstable and need extreme
| violence to prevent dissent and dissolution. Autocrats
| basically steal from people at the bottom who in turn are less
| incentivized to give their best performance. Democracies are
| much more stable due to acceptance by most people who live in
| them and much more fair sharing of profits.
|
| 2) Due to their inherent instability, autocracies have a very
| high incentive to fake numbers.
|
| With this background, I think your arguments are for the trash
| can.
| tokioyoyo wrote:
| I generally agree, but "China is doomed because autocracy"
| has been on the media since 2000s. There's been literally two
| new generations of people that have been born. The country
| seems fairly stable as of now.
| msabalau wrote:
| China had everything going for it for couple of decades. Other
| countries were happy to outsource manufacturing and invest for
| the sake of access to the the Chinese market and under the
| assumption that great power conflict with China was very
| unlikely. None of those things, broadly is true any more.
| api wrote:
| China has more than 3X the population of the US, so it only
| needs a bit over 1/3 the GDP per capita to overtake the US. I
| can't imagine that not happening unless China really screws up.
|
| Overtaking the US on GDP per capita is much further away.
| deepsun wrote:
| I remember when USSR tried to make everything on its soil. It
| didn't end well.
| renewiltord wrote:
| Part of it is that they have surprisingly good industrial policy.
| Usually it's a bad idea, but US industrial policy is especially
| bad. Joe Biden's blocking of Nippon Steel Corp's takeover of US
| Steel is particularly dementia-driven, saying that the Japanese
| are out to damage our national security. Of course, the last time
| this came up on HN, most users here did not even realize that US
| Steel is just another steel producer and not even our biggest one
| because the name is 'US Steel'. Less than a month of this idiocy,
| thank fuck.
| whimsicalism wrote:
| trump is not going to end stupid industrial policy
| renewiltord wrote:
| Indeed. That's what I meant by " US industrial policy is
| especially bad". It's usually a regulatory capture thing
| here.
| soramimo wrote:
| And unfortunately for the West, manufacturing capacity translates
| to military capability in any prolonged conflict (which is why
| industrial policy and tariffs in dual use / strategic industries
| seem like the way to go)
| treebeard901 wrote:
| Any non-nuclear prolonged conventional war will see U.S. ammo
| and shipbuilding far surpassed by Chinas manufacturing base and
| it isnt even close. The U.S. plan was to cut off oil shipments
| and food if this happened. Now China can likely have a Navy
| capable of guarding oil shipments from the Middle East all the
| way to Chinese ports. Everyone in the U.S. just assumes that
| they did it in 1940 so they can just do it again in 2040. It
| was the manufacturing capacity that won in the 1940s in the
| first place!
| thruway516 wrote:
| You might be right. But a major 21st century conflict is
| likely going to be very different from past conflicts and we
| still don't know what that will look like. We're getting a
| few glimpses from the Ukraine conflict - drones, social media
| - but who knows what else. Having a numerical advantage in
| conventional arms might be the equivalent of having superior
| cavalry at the onset of WWI
| bigthymer wrote:
| > We're getting a few glimpses from the Ukraine conflict -
| drones, social media - but who knows what else
|
| Actually, from the assessments that I have read, while new
| technology and drones have made a meaningful splash, it
| seems like manpower and the ability to produce large
| quantities of artillery shells have been the true
| determiner of the tides. The lesson learned thus far is
| that considerations from the past still matter.
| thruway516 wrote:
| Well I did say a glimpse. Manpower, food, supply chains
| and all the basics will never not matter. It's a question
| of what could be a deciding advantage that did not exist
| before, like mechanized divisions in WWI and air power
| subsequently. Russia-Ukraine is still a very conventional
| land war but it won't surprise me if a future China-US
| conflict was fought (and maybe even won or lost)
| virtually as well as conventionally.
| kelipso wrote:
| In that scenario, they would use Russia rather than Middle
| East for oil shipments in the first place.
| audunw wrote:
| How far in the future are we talking about?
|
| Russia doesn't have the capacity to transport that much oil
| by land. It'd take years to build that infrastructure and
| it's not even clear that China is at all interested in
| supporting huge investments that make them that dependent
| on Russia. Keep in mind that China and Russia are not
| fundamentally friends.. Russia is still holding territory
| that belonged to China, and that China wouldn't hesitate to
| take back if they saw an opportunity.
|
| Unless they can transport by sea by the arctic route year
| round (could eventually be enabled by climate change), the
| only way is to go south. Which is a far more vulnerable
| route than oil from the Middle East.
| TrapLord_Rhodo wrote:
| you can't look at "Manufacturing" and translate that to
| military capability. what you manufacture is very important.
| Nothing china has can compete with the airpower capabilities of
| the west. A single F35 has the capabilities no amount of
| chinese planes can match.
| slaw wrote:
| J-20 vs F-35
|
| https://simpleflying.com/china-j-20-vs-us-f-35-evaluating-
| mo...
| rich_sasha wrote:
| I think there's no denying that this is super impressive.
| Realpolitik aside, well done China.
|
| I wonder how manufacturing output compares between China and
| US+EU, say. It doesn't make that much sense to look at EU
| constituents in separation. Even then I suppose China is ahead,
| but maybe it's not a total wipeout.
|
| That led me to wonder about manufacturing output vs GDP. Is China
| producing more, after adjusting for its total GDP. So for
| example, China's GDP is about 4-5x bigger than Germany's, whereas
| the fraction of manufacturing output is about 5-7x different. It
| still puts Germany "behind" but it's not outright domination.
|
| In fact, such fraction, of manufacturing to GDP, is a basic
| economics measure: it's the fraction of GDP coming from
| manufacturing! And it's no surprise to anyone that this fraction
| is high in China.
|
| So then I guess the questions would be:
|
| - is manufacturing expected to outperform the other constituents
| of global economies going forwards (i.e. is China smart putting
| its eggs in this basket)
|
| - is the rest of the world at risk because China can squeeze them
| (perhaps)
|
| - what is the outlook for manufacturing outside of China (maybe
| not great but it seems like people are waking up to this).
|
| I wonder how much of that simply cuts back to marginal costs of
| energy and ESG. Presumably in China you can manufacture cheaply
| partly because you don't need to pay for employee rights or clean
| energy. Not all of this, clearly, but where would US+EU be if it
| wasn't constrained by broadly speaking ESG (I'm not saying it's a
| bad thing, but it is a thing).
| grobbyy wrote:
| World War II was won because of US and (less advertised) Soviet
| manufacturing capacity.
|
| Ukraine is more constrained by weapon supplies, especially
| drones and artillery, than by manpower.
|
| I'm not sure both sides are playing the same game. In the game
| I think might be afoot, if your economy is management
| consultants, therapists, and hair stylists, that's "bad" GDP.
| Resources and manufacturing are "good" GDP. Resources are
| complex in that stone are renewable, and some go away when you
| export them.
|
| I'm not even going to talk about education or, related, R&D
| capacity.
| whimsicalism wrote:
| high finance/management can be quite valuable when you're
| trying to plan a conflict. this is how you get the industries
| developed that are capable of designing a system to turn sand
| into missile-targeting systems.
|
| i'm extremely skeptical of people's ability to view the
| economy from on high and pick out the "good, productive gdp"
| and the "bad, makework gdp".
| m0llusk wrote:
| The imbalance in trade sectors is striking. China is dominating
| manufacturing, but this is requiring huge imports of agricultural
| goods and also services. The result being that there is a trade
| surplus, but it is far smaller than manufacturing dominance
| implies and also potentially quite volatile. Global changes like
| the war in Ukraine stressing agriculture supply lines and the
| decline of Hong Kong as a provider of services could have large
| impacts on Chinese trade.
| metalman wrote:
| my favorite bit of trivia connected with the whole "trade war" is
| the sudden apearance in China, of companies devoted to the making
| labels, the most poular (currently) are those saying "made in
| vietnam" and apocryaphal or not?, there is a city in china named
| USA, which satisfied the beurocratic requirements of some other
| round of protectionism
| throw0101b wrote:
| See also "Manufacturing is a war now":
|
| > _Democratic countries' economies are mainly set up as_ free
| market economies with redistribution, _because this is what
| maximizes living standards in peacetime. In a free market
| economy, if a foreign country wants to sell you cheap cars, you
| let them do it, and you allocate your own productive resources to
| something more profitable instead. If China is willing to sell
| you brand-new electric vehicles for $10,000, why should you turn
| them down? Just make B2B SaaS and advertising platforms and chat
| apps, sell them for a high profit margin, and drive a Chinese
| car._
|
| > _Except then a war comes, and suddenly you find that B2B SaaS
| and advertising platforms and chat apps aren't very useful for
| defending your freedoms. Oops! The right time to worry about
| manufacturing would have been_ years before _the war, except you
| weren't able to anticipate and prepare for the future.
| Manufacturing doesn't just support war -- in a very real way,
| it's a war in and of itself._
|
| > _Democratic countries seem to still mostly be in "peace mode"
| with respect to their economic models. They don't yet see
| manufacturing as something that needs to be preserved and
| expanded in peacetime in order to be ready for the increasing
| likelihood of a major war. Fortunately, both Republicans and
| Democrats in America have inched away from this deadly
| complacency in recent years. But both the tariffs embraced by the
| GOP and the industrial policies pioneered by the Dems are only
| partial solutions, lacking key pieces of a military-industrial
| strategy._
|
| * https://www.noahpinion.blog/p/manufacturing-is-a-war-now
|
| FDR started preparing for war years before WW2 / Pearl Harbor
| (warning: heavy anti-union slant in the book as it was funded by
| AEI):
|
| * https://www.goodreads.com/book/show/13152691-freedom-s-forge
| TriangleEdge wrote:
| Forgive my ignorance, but how does a country with a strong
| military turn that into GDP? I don't understand how military >
| manufacturing in terms of GDP. In my mind, manufacturing >
| military, but my knowledge of economics isn't great.
| SirHumphrey wrote:
| GDP includes government spending. If a country spends a lot of
| money on military, that reflects in GDP figures.
| credit_guy wrote:
| That's correct, but it's not that material. The US GDP is
| about $27 trillion, the military spending is about $1
| trillion, or about 3% of the GDP.
| VHRanger wrote:
| Correct. But military spending only *grows* GDP if the money
| is invested properly. In, say,
| research/infrastructure/training, etc.
|
| Malinvested money will pump GDP for a few years before growth
| stops and potentially reverses.
| chvid wrote:
| In the old days a country would use its military to conquer or
| subvert other countries to setup exploitative trading
| relationships.
|
| For example the opium wars.
|
| Nowadays the empire works via its currency that allows it to
| buy real goods and assets for something it can create for free
| with little constrain.
|
| Of course the exploitive nature of the "exorbitant" privilege
| is controversial; and some economists would argue that it does
| not exist at all.
| marcosdumay wrote:
| > For example the opium wars.
|
| For a more recent example, the CIA operations on South and
| Central America in the 20th century. But well, it didn't take
| the entire military there, just a military-like
| paragovernamental entity.
|
| Doing that today would be seen in a bad light and has a real
| chance of turning the entire world against the country. That
| doesn't seem enough to stop Russia, though.
| marcosdumay wrote:
| In the 20th century, the US was quite successful into turning
| "military spending" into very advanced R&D subsides. I think
| most of the believes that military spending and growth are
| related come from that.
| AnthonyMouse wrote:
| The premise that China does around a third of the world's
| manufacturing isn't really _that_ surprising, they have more than
| a sixth of the world 's population and there are a lot of areas
| (e.g. India and Africa) that have large populations and a
| disproportionately _small_ share of manufacturing.
|
| The real problem isn't that it's a third, it's that it will be
| something like 2% of commercial aircraft and 98% of PCs, and then
| the second one is _bad_. Single point of failure. That 's the
| part that needs to be addressed.
| whimsicalism wrote:
| give me an example good where china has 98% share
| AnthonyMouse wrote:
| You can find threads where people are asking for laptops that
| aren't made in China and the responses end up being things
| like "well some of those are made in _Taiwan_ " or "this one
| is made of components from China but the final screw is
| tightened in the US for labeling reasons".
| MaxGripe wrote:
| I remember how until quite recently, the West viewed the East,
| particularly China, as a backward region. People would even
| dismissively use the term 'Chinese junk'. In a remarkably short
| time, that perception has completely flipped. Now it's the West
| that seems to be falling behind...
| giardini wrote:
| MaxGripe says _"...that perception has completely flipped "_
|
| I avoid goods made in mainland China but seek out those made in
| Taiwan b/c they are exquisitely tooled. Both are Chinese but
| mainland manufactury severely lags Taiwan's.
| whimsicalism wrote:
| people are slow to adapt and have very outdated ideas of
| countries that are not their own. i see this upcoming with
| India too and Mexico soon
| wiseowise wrote:
| > People would even dismissively use the term 'Chinese junk'
|
| I still do. Amazon in Europe is completely filled with Chinese
| junk, it's nigh impossible to find anything EU/US produced in
| certain categories. It became Alibaba with markup.
| serpix wrote:
| There is no EU/US equivalent to many products. We simply
| don't make things.
| Der_Einzige wrote:
| When did this flip?
|
| What do the Chinese make in high quality besides silk, EVs, and
| Orwellian tyranny?
| thelastgallon wrote:
| https://www.youtube.com/watch?v=NzKuHxp7WqA
|
| tl;dr: Today China vs US is 19% vs 16% world GDP. By 2035, it
| will be 24% vs 14%. China will be large economy, US can't beat
| China. Unless there is a nuclear war, which is probably less than
| ideal.
| obscurette wrote:
| It's not about what China did well, but about Europe/US
| ignorance. How many times you've heard during last decade that
| software eats the world? That we should do highly profitable
| software things only anyway? That everyone and his dog should be
| a software engineer in future? Well, turned out that it was
| really about free money and it didn't last. Serious question -
| how many of you who say that they can't find the job any more,
| have considered manufacturing?
| https://x.com/zanehengsperger/status/1862134411657117773?mx=...
| sangnoir wrote:
| > how many of you who say that they can't find the job any
| more, have considered manufacturing?
|
| If one wants a skilled job in manufacturing, they have to earn
| a qualification first, or go through a period of
| apprenticeship. The wages for most manufacturing jobs are much
| lower in the west than for knowledge workers, and openings
| likely fewer - it's only recently that new manufacturing sites
| got spun-up after decades of continuous decline- thanks to 2
| pieces of legislation from the Biden administration; the
| Inflation Reduction Act and the CHIPS Act
| obscurette wrote:
| There is a non-zero chance that these higher wages of
| knowledge workers and especially in IT industry were actually
| the results of rent-seeking.
| aeonik wrote:
| Software is eating the world, you just need to multi class into
| the field that software is eating to be of good value.
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