The horizon is not so far as we can see, but as far as we can imagine

China “To Those Who Have Everything”

This is why you don’t give away your manufacturing base. China is “gaining market share in both low and hi-tech sectors.”  It is “now a more important international supplier than Germany, the U.S. and Japan combined.” China’s share of manufacturing exports grew from 17% in the 2017 to 21% in 2021.

The US recently put a ban on sending advanced AI chips to China, and the CHIPS act forbids any company which takes money from setting up new fabs in China, but it isn’t going to matter. Just as China jumped two chip generations (from 11 to 7nm) far faster than any western expert I know of thought they could, they will catch up in AI chips.

Then they will surpass.

As people at least as far back as Adam Smith pointed out, scale matters for efficiency in a lot of industrial processes. China has it. Once the US did, and before that England. Where the manufacturing floor is matters as well, it leads to faster iteration and more understanding of what works and doesn’t: “to those who have everything, more is given.”

America efforts to stem the rise of China aren’t working. The current anti-Russia sanctions are hurting Germany in particular. The entire “globalization” nonsense was a huge mistake for the West, and it will lead to a civilizational transfer of the locus of power from Europe/America to China/Asia unless climate change interferes (which it might.)

But the key thing to understand is that this is accelerating, not slowing down. In the 19th century, Britain deliberately helped America industrialize so its rich could make more money, without looking at the fact that it was a continental power with a larger population. In the late 20th and early 21st century, America did the same with China.

Helping Japan and Korea and Taiwan industrialize or reindustrialize didn’t matter that much: at the end, they are population constrained.

China isn’t. And for a few coins the West’s elites gave another civilization the opportunity to surpass it in perhaps the most important source of power in the post-industrial revolution world.



Week-end Wrap – Political Economy – September 11, 2022


Solutions: Cash, The Unbanked, and Cashless Stores


  1. Astrid

    Climate change may slow or stop China’s rise in absolute terms, but it will likely accelerate its rise in relative terms. A country that is still able to mobilize and organize on a massive scale will do better than ones that cannot. Witness how quickly the Chinese were able to sent in military and civilian aid workers to respond to a recent earthquake and taper energy use to respond to droughts. The Chinese have been buying up a substantial amount of food, beyond their typical 18 months food reserve (a practice that spawned an entire food industry and recipes to utilize the otherwise undesireable aged “granary rice”). That’s a fast more robust system than just in time (non)solutions.

    The Western media talked up overcapacity and bank insolvencies, but those are really just minor structural issues that can be overcome whenever there is the will. A good currency depreciation or steep asset tax may be a very good thing for the gini index.

    The most important role of a government is to keep its people safe from internal and external that’s, keep them fed, and sheltered. This is something every government understood implicitly until liberalism and rentierism rotted their minds.

  2. anon y'mouse

    “they” (the Owners) don’t care. they intend to use U.S. MIC to beat China into submission, while the upper castes there discuss making a deal with Wall Street because “at least WS wants to continue to make $$$”(paraphrase from recent article discussing various thoughtlines among China’s new capitalist-managerial class).

    we, the citizens of all of these places, are simply hosed. to be used as cannon fodder, mind controlled re-uppers of mass propaganda, and wage slave labor, lastly consumers because that is the element that is going to become constrained to just a few if it isn’t already (or hasn’t been throughout history). justification this time will be “to save the planet” but it will simply be the old austerity/”living within your means” by caste.

  3. Willy

    Whenever a conservative tells me that the economy is all Biden’s fault, I remind them that these troubles are worldwide, and that the nation most capable of influencing the world’s economy is actually China. Evil atheist China. And that the Chinese government is in it for their own people.

    Probably not entirely true, but the way conservatives are being conditioned, I figure it’s worth a shot. Meanwhile stateside, as much as I dislike Biden, his recent actions are at least getting some Americans to think about what a government that’s actually a bit more “for the people” might be like. Like China I suppose.

  4. Harry Haller

    Western elites didn’t “give” China anything. What happened is western capitalists outsourced manufacturing to China and other countries with lower labour costs in order to increase profits and to disempower the organized western working class. China, acting rationally and reasonably, took advantage of its position as manufacturing powerhouse to improve its people’s living standards and quality of life.

    The idea that the west did China a favour or gave it something for free is complete nonsense. It was basic capitalist logic at work (lowering costs and maximizing profits). What upsets the west is that China went its own way and didn’t become an obedient satrapy that lets western business interests plunder it at will.

    The west made its own bed and now has to lie in it. Blaming China, Russia and other convenient hobgoblins for its inability to address deep seeded economic and social dysfunction at home and for tensions fuelled by its zero sum, anti-diplomacy foreign policy is a cop out.

    Funny how the liberal capitalist countries of the west, where personal responsibility is ostensibly a leading value, never take responsibility for anything. It’s always someone else’s fault.

  5. Ian Welsh

    Reading in a lot.

  6. someofparts

    Was watching a podcast with Jeffrey Sachs and another economist today. The economist speaking with Sachs works in international finance and has spent time in China working with high-ranking government officials.

    He said every one of them told him China had been dismayed when they saw that the Americans who made money moving US industry to China did nothing to retrain or help the people in their own country who were hurt by losing those jobs. Instead they watched them keep all the money for themselves, use their power to stop themselves from being taxed and then park their money offshore.

    He said that the Chinese told him they did not like seeing that happen, but were powerless to stop it. But they said that the part that confused them was that the Americans were now blaming the Chinese for the damage they did back then (and continue to do) to their own country.

  7. someofparts

    In that same Sachs interview both economists noted the impact it has when a nation does or does not share the wealth that trade creates. They remarked that in Sweden, where the wealth generated by trade and technology are shared with the population at large, regular citizens welcome trade and automation too, because they know they will share the benefits. In contrast, when leaders like the Americans keep all the new wealth for themselves and sneer at the people they consign to poverty, citizens become hostile to trade and technical innovation. Even though such things increase prosperity for a nation, in a place where the leaders hog all the gains, the population sees those economic enhancements in negative terms, to everyone’s detriment.

  8. different clue

    @Harry Haller,

    ” Individdle responsibilitude” is a Jedi Mind Trick which the elites use on the subject victims of the Western countries. The subject victim majorities did not do what you describe. The ruling elites did that. And we the subject victim majority do our best to survive in a world we never made.

    The only individdle responsibilitude which we-the-majority are functionally able to excercise will be in where each of the separate one-billion of us direct our paltry separate little meant-to-be-spent revenue trickles. If those one-billion separate individdles can somehow unite on targetting their separate little individdle meant-to-be-spent revenue trickles toward a one single shared klektiv vision and target, then maybe we can still achieve something more than zero against our elite occupiers. Such actions might be called “economic combat”. Every dollar is a bullet on the field of economic combat.

    There are also still some regional or local or micro-local jurisdictions where democratic self-governance has not yet been severed or lobotomised. Bunch-loads of people in those particular jurisdictions might still be able to vote into power and keep in power governance which will work to defend those local or micro-local area-loads of people against elite governance from above and outside the area. Such actions might be called political combat. Such political combat might allow its practitioners to shape certain little battlespaces to the advantage of the political combatants involved, such that every economic bullet fired becomes an insta-lethal head-shot against one or another pain-center/control-tentacle of elite rule over local areas.

    For example, if the local elite of your town want to privatise your municipal water works, and you can elect self-governators which can shoot that plan in the head, that is some anti-elite control you can exert at your local level of existence.

  9. different clue

    @Harry Haller,

    Oh . . . . also . . . . Western elites gave China access to Western markets. The Western victim majority did not support that giveaway. But we could not stop it.

    But it was not the Western masses who did that. It was the Western elites who did that.

  10. Chipper

    Quoth the Western elites: “Totally worth it.”

  11. different clue


    I imagine a beautiful future in which the lower class majority conquers the American government and begins its ow Great Reset by rounding up all the pro-Free Trade American elites, gathering them at certain gathering points next to big pits and trenches, mass machine-guns them all and pushes them all into the big pits and trenches and then covers them up with bulldozer dirt.

    We declare a Peoples National Republic of Autarkamerica and cancel every free trade agreement and/or organization America is currently in. We recognize the reality that trade is the waging of war by other means.

    ” America has stood up!”

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