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The Economist: Miffed with NAFTA

Ahlevah said:
China has moved relatively quickly from being an economic backwater to possessing the second-largest economy on the planet, creating entire industries through joint ventures (where the foreign entity is required to take a minority stake), technology transfers, and even theft of critical technolgy. They didn't advance their economy by playing nice.
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Oh Jeez.

China grew like gangbusters because they abandoned 'pure' Communism and embraced semi-free enterprise.

Their economy was a complete mess during the Cultural Revolution. So, they grew fast from nothing. Like Japan and Germany after WW2. They embraced western economic ideas and grew like mad (Germany had to change the least).
And if Cuba abandoned Communism and embraced western economics - they would grow like crazy too.

It's little to do with protectionism...it's to do with adopting a successful economic model AND having cheap labor/few regulations to take advantage of that model.

There are many economists (some of whom I respect like Jim Rogers) who say it is easier to make money for westerners in China than America...that there is less red tape there. Sure, for certain industries it is tougher. But for others, it is much easier. America has become a red tape/tax/regulation/overhead nightmare for many corporations.

Westerners are not buying Chinese goods en masse because China is 'cheating'. They are buying them because they are FAR less expensive than American/western versions are.
I mean think, please. If China was doing so well strictly because of tariffs...then why do Americans buy Chinese goods in such gigantic quantities? China cannot tariff American products sold in America. Yet they consistently outsell their American manufactured counterparts. That is because they make them FAR cheaper...it has nothing whatsoever to do with Chinese protectionism.

Though I realize all of the above is probably lost on you...no offense.


Good day.
 
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DA60 said:
Oh Jeez.

China grew like gangbusters because they abandoned 'pure' Communism and embraced semi-free enterprise.

Their economy was a complete mess during the Cultural Revolution. So, they grew fast from nothing. Like Japan and Germany after WW2. They embraced western economic ideas and grew like mad (Germany had to change the least).
And if Cuba abandoned Communism and embraced western economics - they would grow like crazy too.

It's little to do with protectionism...it's to do with adopting a successful economic model AND having cheap labor/few regulations to take advantage of that model.

There are many economists (some of whom I respect like Jim Rogers) who say it is easier to make money for westerners in China than America...that there is less red tape there. Sure, for certain industries it is tougher. But for others, it is much easier. America has become a red tape/tax/regulation/overhead nightmare for many corporations.

Westerners are not buying Chinese goods en masse because China is 'cheating'. They are buying them because they are FAR less expensive than American/western versions are.
I mean think, please. If China was doing so well strictly because of tariffs...then why do Americans buy Chinese goods in such gigantic quantities? China cannot tariff American products sold in America. Yet they consistently outsell their American manufactured counterparts. That is because they make them FAR cheaper...it has nothing whatsoever to do with Chinese protectionism.

Though I realize all of the above is probably lost on you...no offense.


Good day.
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It's like people have no concept of competitive advantages between different countries, truly baffling.
 
Ahlevah said:
China has moved relatively quickly from being an economic backwater to possessing the second-largest economy on the planet, creating entire industries through joint ventures (where the foreign entity is required to take a minority stake), technology transfers, and even theft of critical technolgy. They didn't advance their economy by playing nice.
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They do have problems innovating. If a sizable portion of your technology is borrowed from others who had to embrace the design process, it leaves a sizable hole in the creative aspect of innovation.

That aside, there is an economic rationale for infant industry protectionism. But once these industries are capable of competing on their own merit, and are held back by their own training wheels so to speak, such policies become a detriment to their development.
 
Ahlevah said:
They didn't advance their economy by playing nice.
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a communist country can send its students to America, reverse engineer everything we make, steal our secrets, read our technology journals etc etc and still fail miserably without Republican capitalism to organize business activity. Do you understand?
 
James972 said:
a communist country can send its students to America, reverse engineer everything we make, steal our secrets, read our technology journals etc etc and still fail miserably without Republican capitalism to organize business activity. Do you understand?
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I understand that rising from an economic backwater to the second-largest economy on the planet in less than thirty years is not failing miserably. Do you?

shanghai-skyline.jpg
 
Ahlevah said:
I understand that rising from an economic backwater to the second-largest economy on the planet in less than thirty years is not failing miserably. Do you?
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why would they fail given that they allowed Republican capitalism to organize their 36 year growth spurt?
 
Kushinator said:
That aside, there is an economic rationale for infant industry protectionism.
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not really since then the protected industry and bureaucrats that protect it will always claim infancy. Google Apple MIcrosoft etc didn't get protection.
 
James972 said:
not really since then the protected industry and bureaucrats that protect it will always claim infancy. Google Apple MIcrosoft etc didn't get protection.
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They didn't have to... they were the pioneers!

But Samsung, Sony, Softbank, etc.... are able to compete on the basis of their own merit.
 
James972 said:
why would they fail given that they allowed Republican capitalism to organize their 36 year growth spurt?
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Republican capitalism? Is that what you call it? I call it something else:

The most potent of China's "weapons of job destruction" are an elaborate web of export subsidies; the blatant piracy of America's technologies and trade secrets; the counterfeiting of valuable brand names like Nike and Chevy; a cleverly manipulated and grossly undervalued currency; and the forced transfer of the technology of any American company wishing to operate on Chinese soil or sell into the Chinese market.

U.S. trade policy: America's unequal trade relationship with China - latimes
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James972 said:
what do you call it and why?
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It's a managed economy run by an authoritarian regime. I call it that for the reasons mentioned in the article I quoted: piracy and theft of trade secrets, counterfeiting and lack of protections for intellectual property, currency manipulation, forced transfer of technology, etc.
 
Ahlevah said:
It's a managed economy run by an authoritarian regime. I call it that for the reasons mentioned in the article I quoted: piracy and theft of trade secrets, counterfeiting and lack of protections for intellectual property, currency manipulation, forced transfer of technology, etc.
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trivial aspects of their economy since most economies including ours do the same things. Most importantly they now have millions of private businesses that compete and win in Republican capitalist markets all over the world.
 
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