Comment by toddmorey
2 hours ago
It feels like the US for years has operated under the assumption that homeostasis for the global economy would always be “designed in California, assembled in China.”
Like there was something in the American DNA that was lacking in China and innovation would always need to happen here.
But China it seems doesn’t need the US to produce great cars, devices, robotics, or AI. We absolutely need China to help us build all of the above.
Might be more far to say: they needed the US until they caught up. The massive straight up IP theft helps a lot here. Though theft might be too strong since a lot of companies knew what they were getting in to
Ok, not my favorite narrative, but assume asymmetric application of intellectual property rights was a big factor. Wouldn't the US exploiting asymmetric labor wages, rights, and conditions be the even bigger story? It still feels like a short-sighted own goal. The US abandoned its ability to manufacture. Maybe dark factories and robotics can bring it back, but manufacturing supply chains are just so much more advanced in Asia than in the US.
Wait until you hear about the history of US industrialization. This trope of 'they stole our ideas' needs to fade away, it's a coping mechanism based on the assumption of inherent superiority of American society rather than the natural wax and wane of civilizations due to varying structural factors.
The US committed massive IP theft in the 19th century when we industrialized.
At some point we can’t keep blaming IP theft for obvious innovation and investments being made by China.
We also can’t blame subsidy. All countries subsidize their industries
This video on the auto industry covers a different industry but has a lot of the same rhymes as far as China’s strategy:
https://youtube.com/watch?v=UhhZu0ZHdw4
The gist of it is that China does the following:
1. Treats low margin industries like mining and utilities as areas to focus investment and come up with incremental improvements, making those available to all companies. The West, by contrast, allows private companies to handle those industries, who logically don’t bother investing in them since their investors consider those basic aspects to be low-value segments of the production chain.
2. Because all companies in China have access to the same excellent infrastructure, they must compete furiously on quality of their products.
3. China allows foreign competition so long as they operate in China (see: Tesla) further insisting that their domestic products be globally competitive and that foreign products sold in their country benefit their local ecosystem.
Propaganda. We americans ate that shit up.
There's nothing special about anything we design in the US other than time and money commitment to create it. China did have some espionage of course going on, but the vast majority of shit isn't some secret. And with the US shitting on China with restrictions, we increasingly caused them to invest time and money into things they otherwise would have passively accepted as coming from the west. ASML sees the writing on the wall for themselves in particular.