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I'm sorry, but China has been a pro at stealing IP from the West. I'm actually with Trump on this one (gasp) - but I think it needs to go one step further and a

I'm sorry, but China has been a pro at stealing IP from the West. I'm actually with Trump on this one (gasp) - but I think it needs to go one step further and actually drop trade all together. Fact is, China straight up has people from the government who sit in factories reverse engineering the stuff that's built. The Chinese government (after it's been reverse engineered) helps support competitive businesses, then locks out the U.S. or other Western competitors (as it's in the national interest). It's insane that the west has put up with this, because it's literally going to cripple the west in the long run. Regarding this case, it's espionage essentially... But not really supprising given the prior events.

anonymous5133 8y ago
Exactly. None need look further than the story of american superconductor. American superconductor made wind turbine control systems. They partnered with a Chinese company called sinovel who made the turbines. Eventually some Chinese engineer stole the company's software and gave it to the company. The Chinese company canceled the contract with american superconductor and then used the stolen IP to continue business as usual. American superconductor was nearly bankrupted in the process. Free trade only works if you have fair trade, otherwise it is every man for themselves. Trump knows that trade with China is rigged so there is no point in having free trade with them. Most people who complain about Trump playing hardball with China are very uninformed about the reality of the situation. China is getting ready to gut the US economy from the inside out. China will make sure it never has a trade deficit with the USA. They will buy some of our stuff but only if they have a trade surplus.
- toomuchtodo 8y ago
  It’s extremely unfortunate that we’re having to take the painful tariff route, and while Trump is not stately in his handling of the situation, it’ll be a valuable lesson to China if the US can push their overleverged economy into recession with escalating tariffs (as it’s clear they’ll continue their advancement through the theft of Western technology).
  - frockington 8y ago
    Yesterday China fell back to having the #3 largest stock exchange. With US success other countries might start piling on soon, hopefully China will take action before that happens though, it could get really ugly really quick for them
    - pishpash 8y ago
      I think you'd be waiting a long time, and it won't be ugly just for them.
- Fricken 8y ago
  Knowledge wants to be free. Adam Smith considered IP laws to be an unnecessary evil. The Chinese are just being good capitalists. American Superconductor nearly went bankrupt because they couldn't compete on a level playing field. https://youtu.be/axXTMUmTOyE https://youtu.be/axXTMUmTOyE
  - alehul 8y ago
    Do you believe that, without IP law, we'd still have companies invest the amounts they do into creating new technology (particularly in high R&D areas like pharma)?
    - baybal2 8y ago
      Pfffff, just not pharma. A lion share of genuine new pharmaceutical research is done by underpaid undergrad mules in sweatshops called "captive R&D centres" in places like China and India, that the reality.
    - Andhurati 8y ago
      Isn't most research done in government labs or universities? Innovation is great but it's mostly a buzzword to describe the aformentioned research in commercial areas
      - adventured 8y ago
        No. The US Government is 18%-20% of all R&D spending in the US. A lot of that is in the military budget of course. Which makes perfect sense when you consider the size of the private economy versus the share of government spending that could reasonably go to R&D (versus entitlements, military, infrastructure, etc). Private corporations are around ~$400 billion of the ~$550 billion per year spent in the US on R&D. The government R&D figure as a share is higher in the EU than in the US, but not dramatically so. The private sector is simply too large by comparison and can focus its resources more narrowly on things like R&D than what a government could be expected to.
        8y ago
- pishpash 8y ago
  You're highly misinformed. Trump never cared about the IP angle, only deficits. The IP angle came out of a report that was long in the works. Furthermore it doesn't make sense to talk about bilateral trade figures. China has basically balanced trade with the world because it sources inputs from abroad. That's also without talking about the services trade of which China buys a great deal from us.
- oh_sigh 8y ago
  Isn't this what the WTO is for?
baybal2 8y ago
Funny thing to mention, I think 95% of industrial espionage effort yields zero if not negative benefit. The problem is that you are always stealing a "cat in a bag" For machinery, rarely there is anything like a "secret sauce:" Soon after the fall of USSR, Chinese defence companies flocked to Russia buying every defence tech possible. Russian companies had a funny way to troll Chicoms: they will not sell them a simple, mid-tier equipment, but only the top notch, and most complicated one, with which even they themselves had problem dealing. For example, Soyuz transferred tech for their super expensive, small volume manufactured R179 engine. Yes, that was Soviet response to F135 class engines. The showstopper was its very high temperature turbine made with monocrystaline blades grown in situ within (!) a ceramic fibre reinforcing mesh. Even with all blueprints, documentation of manufacturing processes, and working samples on their hands, Chinese never made a single working engine. That state program to copy R179 continues to this day as I know. And I think they spent way more money on it in 25 years, than if they were to create a thing from scratch. That is something obvious to every experienced engineer, but not to bureaucrats from Chinese three letter agencies who are convinced that they are just an inch away from some "secret trick" that will magically make everything work.
- creddit 8y ago
  "I think 95% of industrial espionage effort yields zero if not negative benefit" Citation needed. That makes extremely little sense.
  - baybal2 8y ago
    Why? I think it's quite clear, to know what valuable knowhow to steal, you have to know quite a bit about the subject as well. After doing that much research, it may well be that you know enough to do it on your own.
    - wadkar 8y ago
      You need to provide evidence for your claims, specially more if you’re going to trow around numbers. For example why 95%? Why not 5%? Or why not 80%? Please understand that unsubstantiated comments are not constructive for a fruitful discussion. Take a look at the HN guidelines for more information.
pjc50 8y ago
> drop trade all together Are people prepared to give up their iPhones? Actually, never mind that, are they prepared to give up Taiwan?
- varjag 8y ago
  They are prepared to give up Taiwan more than their iPhones anyway. Not that China has a very good shot at it.
HillaryBriss 8y ago
I tend to be sympathetic to your views, but I recently heard a different take on this whole IP / Copyright theft matter and I'm not sure what to make of it: 1. US residents and workers own pretty much zero IP/Copyrights themselves and basically zero stock in companies that own IP/Copyrights. 2. Therefore, forcing Chinese companies and consumers to "pay up" for IP and Copyrights really only benefits US companies and wealthy stockholders (not US consumers and workers). 3. If there no charge at all for this stolen IP, Chinese companies would be able to offer cheaper exported products to US workers and consumers, who would actually benefit more from the lower prices than from protecting the IP in the first place. 4. Furthermore, if US company products (e.g. Microsoft Windows) are pirated in China, it leaves the Chinese consumer with more dollars to buy other US imported goods which are not IP-focused (e.g. soybeans or almonds or wine or something) thus benefiting the average US consumer and worker more.
afpx 8y ago
Agreed. Here’s a personal example from about 10 years ago. Imagine that you spend several years inventing something new. You put in the sweat equity and take on opportunity costs. Then, your product seems to be ready. You’re very excited, so you decide to release it to the public at a popular trade show. On the first day, you meet lots of interested people. Some are American, some European. Oh, and several large gatherings of Chinese people also approach your booth. They admire your invention, too. But, look, and they brought along cameras, video recorders, a few people taking notes. Your heart sinks a bit. Are they really blatantly stealing your idea with no shame? You don’t know. Then, a few months later an (inferior) but visually identical product enters the market. Then a couple more appear. They’re all priced at a fraction of the price of yours... That was the reality a decade or two ago. Maybe it has gotten better. But, things like that have a tendency to make long impressions on the memory. My question is: does this happen in China? Do Chinese companies steal from other Chinese companies? Is it normal for Chinese people to steal from their friends, family, neighbors? Or, is this behavior only directed at the West?

anonymous5133 8y ago

Exactly. None need look further than the story of american superconductor. American superconductor made wind turbine control systems. They partnered with a Chinese company called sinovel who made the turbines. Eventually some Chinese engineer stole the company's software and gave it to the company. The Chinese company canceled the contract with american superconductor and then used the stolen IP to continue business as usual. American superconductor was nearly bankrupted in the process. Free trade only works if you have fair trade, otherwise it is every man for themselves. Trump knows that trade with China is rigged so there is no point in having free trade with them. Most people who complain about Trump playing hardball with China are very uninformed about the reality of the situation. China is getting ready to gut the US economy from the inside out. China will make sure it never has a trade deficit with the USA. They will buy some of our stuff but only if they have a trade surplus.

toomuchtodo 8y ago
It’s extremely unfortunate that we’re having to take the painful tariff route, and while Trump is not stately in his handling of the situation, it’ll be a valuable lesson to China if the US can push their overleverged economy into recession with escalating tariffs (as it’s clear they’ll continue their advancement through the theft of Western technology).
- frockington 8y ago
  Yesterday China fell back to having the #3 largest stock exchange. With US success other countries might start piling on soon, hopefully China will take action before that happens though, it could get really ugly really quick for them
  - pishpash 8y ago
    I think you'd be waiting a long time, and it won't be ugly just for them.
Fricken 8y ago
Knowledge wants to be free. Adam Smith considered IP laws to be an unnecessary evil. The Chinese are just being good capitalists. American Superconductor nearly went bankrupt because they couldn't compete on a level playing field. https://youtu.be/axXTMUmTOyE https://youtu.be/axXTMUmTOyE
- alehul 8y ago
  Do you believe that, without IP law, we'd still have companies invest the amounts they do into creating new technology (particularly in high R&D areas like pharma)?
  - baybal2 8y ago
    Pfffff, just not pharma. A lion share of genuine new pharmaceutical research is done by underpaid undergrad mules in sweatshops called "captive R&D centres" in places like China and India, that the reality.
  - Andhurati 8y ago
    Isn't most research done in government labs or universities? Innovation is great but it's mostly a buzzword to describe the aformentioned research in commercial areas
    - adventured 8y ago
      No. The US Government is 18%-20% of all R&D spending in the US. A lot of that is in the military budget of course. Which makes perfect sense when you consider the size of the private economy versus the share of government spending that could reasonably go to R&D (versus entitlements, military, infrastructure, etc). Private corporations are around ~$400 billion of the ~$550 billion per year spent in the US on R&D. The government R&D figure as a share is higher in the EU than in the US, but not dramatically so. The private sector is simply too large by comparison and can focus its resources more narrowly on things like R&D than what a government could be expected to.
      - 8y ago
pishpash 8y ago
You're highly misinformed. Trump never cared about the IP angle, only deficits. The IP angle came out of a report that was long in the works. Furthermore it doesn't make sense to talk about bilateral trade figures. China has basically balanced trade with the world because it sources inputs from abroad. That's also without talking about the services trade of which China buys a great deal from us.
oh_sigh 8y ago
Isn't this what the WTO is for?

baybal2 8y ago

Funny thing to mention, I think 95% of industrial espionage effort yields zero if not negative benefit. The problem is that you are always stealing a "cat in a bag" For machinery, rarely there is anything like a "secret sauce:" Soon after the fall of USSR, Chinese defence companies flocked to Russia buying every defence tech possible. Russian companies had a funny way to troll Chicoms: they will not sell them a simple, mid-tier equipment, but only the top notch, and most complicated one, with which even they themselves had problem dealing. For example, Soyuz transferred tech for their super expensive, small volume manufactured R179 engine. Yes, that was Soviet response to F135 class engines. The showstopper was its very high temperature turbine made with monocrystaline blades grown in situ within (!) a ceramic fibre reinforcing mesh. Even with all blueprints, documentation of manufacturing processes, and working samples on their hands, Chinese never made a single working engine. That state program to copy R179 continues to this day as I know. And I think they spent way more money on it in 25 years, than if they were to create a thing from scratch. That is something obvious to every experienced engineer, but not to bureaucrats from Chinese three letter agencies who are convinced that they are just an inch away from some "secret trick" that will magically make everything work.

creddit 8y ago
"I think 95% of industrial espionage effort yields zero if not negative benefit" Citation needed. That makes extremely little sense.
- baybal2 8y ago
  Why? I think it's quite clear, to know what valuable knowhow to steal, you have to know quite a bit about the subject as well. After doing that much research, it may well be that you know enough to do it on your own.
  - wadkar 8y ago
    You need to provide evidence for your claims, specially more if you’re going to trow around numbers. For example why 95%? Why not 5%? Or why not 80%? Please understand that unsubstantiated comments are not constructive for a fruitful discussion. Take a look at the HN guidelines for more information.

pjc50 8y ago

> drop trade all together Are people prepared to give up their iPhones? Actually, never mind that, are they prepared to give up Taiwan?

varjag 8y ago
They are prepared to give up Taiwan more than their iPhones anyway. Not that China has a very good shot at it.

HillaryBriss 8y ago

I tend to be sympathetic to your views, but I recently heard a different take on this whole IP / Copyright theft matter and I'm not sure what to make of it: 1. US residents and workers own pretty much zero IP/Copyrights themselves and basically zero stock in companies that own IP/Copyrights. 2. Therefore, forcing Chinese companies and consumers to "pay up" for IP and Copyrights really only benefits US companies and wealthy stockholders (not US consumers and workers). 3. If there no charge at all for this stolen IP, Chinese companies would be able to offer cheaper exported products to US workers and consumers, who would actually benefit more from the lower prices than from protecting the IP in the first place. 4. Furthermore, if US company products (e.g. Microsoft Windows) are pirated in China, it leaves the Chinese consumer with more dollars to buy other US imported goods which are not IP-focused (e.g. soybeans or almonds or wine or something) thus benefiting the average US consumer and worker more.

afpx 8y ago

Agreed. Here’s a personal example from about 10 years ago. Imagine that you spend several years inventing something new. You put in the sweat equity and take on opportunity costs. Then, your product seems to be ready. You’re very excited, so you decide to release it to the public at a popular trade show. On the first day, you meet lots of interested people. Some are American, some European. Oh, and several large gatherings of Chinese people also approach your booth. They admire your invention, too. But, look, and they brought along cameras, video recorders, a few people taking notes. Your heart sinks a bit. Are they really blatantly stealing your idea with no shame? You don’t know. Then, a few months later an (inferior) but visually identical product enters the market. Then a couple more appear. They’re all priced at a fraction of the price of yours... That was the reality a decade or two ago. Maybe it has gotten better. But, things like that have a tendency to make long impressions on the memory. My question is: does this happen in China? Do Chinese companies steal from other Chinese companies? Is it normal for Chinese people to steal from their friends, family, neighbors? Or, is this behavior only directed at the West?