
U.S. Government Strikes Back Against Chinese Investment - kposehn
http://foreignpolicy.com/2018/03/06/washington-strikes-back-against-chinese-investment/
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Slansitartop
This is sensible. China has played the West, by using the unmaterialized
promise of access to its markets to motivate technology transfer to it for its
own strategic advantage. It's never going to let a Western company provide the
technology to power its critical systems, so there's no reason the US should
allow a Chinese one to do the same.

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SubiculumCode
In many respects China has had a hands off approach by the world. They have
high tariffs and other laws that prevent Western products and services
competing in China. I'm no fan of trade wars, or a fan of Trump, but raising
the tariffs on China for steel imports is nothing China isn't already doing.

~~~
SubiculumCode
:edit: Steel was just an example product of many.

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pjc50
This is extremely ironic after decades of pushing the international financial
institutions like the WTO and the IMF to "open other countries for
investment".

~~~
dpwm
It's interesting that the US has advocated free trade whilst also being one of
the biggest advocates of sanctions for countries with administrations that are
not so sympathetic to its plans for them.

Perhaps what the USA wants is not really free trade but "free trade": new
markets to sell labour-derived goods and services to and resource suppliers
with very low wages, low standards of services and low food prices in order to
maintain its (slipping) financially dominant position in the world.

Viewed from this angle the move makes sense and remains consistent with long-
term policy goals. The stance of the current presidential administration is
merely convenient. Whether it works in the long term remains to be seen.

I'm a long-term critic of the US administration's trade and foreign policy and
do not gladly suffer any who are unquestioningly sympathetic with it. So I
have a hard time admitting this, but the consequences of the US' global trade
empire falling are unimaginable to me: I see more ways it could end up in a
significantly worse global situation than a marginally better one.

~~~
conanbatt
> Perhaps what the USA wants is not really free trade but "free trade": new
> markets to sell labour-derived goods and services to and resource suppliers
> with very low wages, low standards of services and low food prices in order
> to maintain its (slipping) financially dominant position in the world.

This is a commonly touted criticism for the US by foreigners. I grew up
basically my entire life hearing this argument. (I'm argentinian).

But I think it fails to grasp the political and economical reality. If the US
restricts importations, it harms itself as well as it harms the would-be
exporter. The idea that the US gains economic advantage by telling other
countries to be open and remaining closed is just false.

Its like a business man telling other business men that paying good wages is
the way to retain employees and then he pays below market: he harms himself
with the hypocrisy.

Secondly, I am convinced that the natural state of human beings is to be
mercantilist and protectionist, which means open trade is always a political
uphill battle. The restrictions the US has on imports has been criticized by
its liberal economists. But politicians are not elected to make good policy,
they are elected to make popular policy.

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bilbo0s
"...The idea that the US gains economic advantage by telling other countries
to be open and remaining closed is just false...."

Well, we do gain economic advantage when nations remain open, because the US
is only open in theory. That said, this "only open in theory" thing affects
us, the citizens of the US, just as much as it affects other nations.

For instance, in THEORY if we in the US don't like the fact that Facebook and
Twitter have the power to shape what we see and hear, we're free to form
startups that offer competing social networks. As a pragmatic matter though,
we really aren't. Such startups are almost guaranteed to fail in the US.

On an international scale we can see this same effect in action by comparing
the vibrancy of the Chinese internet startup market, against that of other,
more open, nations. The vast majority of users in nations with more open
markets use Facebook, Twitter, and other mostly US properties. Don't
misunderstand me, the citizens of those nations can attempt to form internet
startups if they wish, but the reality is that in the face of the giant, well
funded, US competitors also operating in their nations, I, personally,
wouldn't be sanguine about their prospects. The Chinese cleverly avoided that
fate by effectively closing their market.

~~~
conanbatt
The chinese people are much poorer for not having as much foreign companies
inside. They pay extra taxes for the subsidies and quality of service by
having less options.

Yes, its a huge loss for FAANG that they cant compete in china, but its also a
loss for chinese people. It's just not a loss for chinese politicians, that
can tout that thanks to them they created massive companies.

You can run indefinitely on a bad platform while it gives your reasonable
returns. We'll see what happens when china gets its own big capitalist crisis.

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gressquel
I really dont like the Trump administration for various reasons, but one thing
they have done right is showing firm hand against China. Especially when it
comes to the artificial islands in South China sea and also the attempts to
buy western technology by buying companies and institutions in US.

I hope more countries wake up to what China is trying to do. Artificial
island, Rohingya-cleansing, Sri Lanka airport etc. Its just the beginning, we
need to be prepared.

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nl
Umm..

I'm Australian, so I follow the South China Sea closely.

The US seems to have completely abandoned doing anything in the South China
Sea.

I mean - Trump talks a lot about China, but has done nothing to slow the
Chinese build up there.

Here's a recent article about how the Chinese have finished their
fortifications on one of their artificial islands (which are pretty
impressive!): [http://www.news.com.au/technology/innovation/photos-
reveal-c...](http://www.news.com.au/technology/innovation/photos-reveal-
chinas-south-china-sea-island-fortresses-are-complete/news-
story/776e1a695fb41ccb7e47a436594c1530)

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georgeecollins
Those fortifications are a mixed bag in my opinion. On one hand, they help
create area denial for the South China Sea. On the other hand, they are
vulnerable and difficult to defend. Probably also a lower stakes target. If
the Chinese shot at a foreign plane or ship, I think it would be tempting to
attack one of these outposts. Easier and less inflammatory than attacking a
mainland air base or port.

~~~
nl
They are an area denial tactic during peacetime. There used to be free
navigation there, now only warships go near without Chinese permission.

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pure_ambition
I for one think it would be a good thing for the US if Xi Jinping becomes a
dictator. Dictatorships have been proven to be unstable and don't make great
decisions. If inaugurated in a period of growth, they tend to stagnate after
the original dictator dies. See USSR after Stalin and then Khruschev, Robert
Mugabe in Zimbabwe, The Pachas of Turkey, etc... Not to mention other
dictators that were only brought down by war, but lord forbid that happens.

So basically, the destruction of what little democratic-esque institution
there was in China will inevitably result in a decline and/or downfall of the
current political agenda of China, which can only be a good thing for the
world in the long term.

The world does not need more validation of dictatorships. It needs to see
dictatorships fail, and - even more so - it needs to see democracies succeed.

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JumpCrisscross
> _The world does not need more validation of dictatorships. It needs to see
> dictatorships fail_

Venezuela is a dictatorship failing. China's population is 50 times larger
than Venezuela's. Its military capabilities and global economic integration
are commensurately greater. When Xi falls, the best we can hope for is a few
months of chaos contained to Beijing.

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JumpCrisscross
“After the collapse of the Soviet Union, the West welcomed the next big
communist country into the global economic order. Western leaders believed
that giving China a stake in institutions such as the World Trade Organisation
(WTO) would bind it into the rules-based system set up after the second world
war (see Briefing). They hoped that economic integration would encourage China
to evolve into a market economy and that, as they grew wealthier, its people
would come to yearn for democratic freedoms, rights and the rule of law.

It was a worthy vision, which this newspaper shared, and better than shutting
China out. China has grown rich beyond anybody’s imagining. Under the
leadership of Hu Jintao, you could still picture the bet paying off. When Mr
Xi took power five years ago China was rife with speculation that he would
move towards constitutional rule. Today the illusion has been shattered. In
reality, Mr Xi has steered politics and economics towards repression, state
control and confrontation.

...

The West lost its bet.”

[https://www.economist.com/news/leaders/21737517-it-bet-
china...](https://www.economist.com/news/leaders/21737517-it-bet-china-would-
head-towards-democracy-and-market-economy-gamble-has-failed-how)

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loeg
Please add ", D.C." to the headline :-).

(The headline would not be out of place describing Washington state, which
sees a large amount of Chinese real estate investment.)

