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Trade War Has Damaged U.S. Chip Industry

186 points by ETHisso2017 7y ago

apatters 7y ago
Only 8.4% of US exports are to China, but the number is probably higher for semiconductors. It would have been nice if the article had mentioned what that number actually is.
- mytailorisrich 7y ago
  Found this [0]: "The U.S. semiconductor industry generates 30 percent of total revenue from China, with Qualcomm and Micron accruing more than half of sales from trade with Beijing." [0]: https://www.cnbc.com/2018/11/27/us-china-tensions-put-chipmakers-apple-in-hot-water-ahead-of-g-20.html https://www.cnbc.com/2018/11/27/us-china-tensions-put-chipma...
scarejunba 7y ago
The semiconductor is game-changing tech. When America allowed the Hygon Dhyana to be made, America fucked up. Hold it back. This is real tech. You can't let it go. I'm for free societies, but free societies must defend themselves from societies organized to kill free societies. The semiconductor is real. Giving away this will pay poor dividends.
- inflatableDodo 7y ago
  Given that the vast majority of silicon fabrication is not in the USA, I think this ship may have possibly sailed.
- amelius 7y ago
  Has China yet built their own wafer-stepper?
- pjc50 7y ago
  This is ridiculous. Semiconductor manufacturing has been globalised for decades. The "other China" has had TSMC since 1987, and they are world leaders. > Hold it back It's technology. Talking about technology is speech. You can have free speech or technology export restrictions but not both. Why do people keep suggesting ways to keep America ""free"" that make it substantially less free? Especially since 9/11.
  - simonh 7y ago
    To your last point, because they value their freedom to do things they want, more than they value your freedom to do things you want, and will throw you under a bus to get their way.
  - scarejunba 7y ago
    Taiwan is not China.
  - inflatableDodo 7y ago
    >It's technology. Talking about technology is speech. Further, the main difference between tools and technology, is story.
- simonh 7y ago
  Legal restrictions are in place and AMD had to be very careful how they went about it, but at the end of the day much of the technology is not exclusively American at this point. ARM is mainly British technology, owned by a Japanese fund. TSMC is Taiwanese. The Silicon cat is well and truly out of the bag. In fact Hygon Dhyana and Zhaoxin (collaboration with VIA, also Taiwanese) are largely responses to the trade war. Aggressive trade practices may be hurting China economically, but it is significantly accelerating their move towards technological independence.
dkraft 7y ago
This is just narrow thinking. Small minds that took advantage of a business deal, now think they have the clout to use public opinion to resume business or to simply smite the hand slapper. Every time this has happened before new avenues and new players have equalized the players.
pjc50 7y ago
This is the thing that economists have been pointing out for decades: at the country scale, allowing free trade provides productivity benefits to both sides, and restricting it affects both sides. You can't have a trade war without domestic casualties. What's crazier is that the strategy of economically integrating China with the world was a Rebublican economic-liberal one to start with. The plan was to make the rest of the world look like America and be trading partners, providing markets for American companies. Someone forgot the last bit.
- ptah 7y ago
  i think from china's perspective "providing markets for American companies" is a form of colonialism which they try to mitigate by forcing IP transfer
  - gorio 7y ago
    Colonialism tends to imply a shift of influence. A government bending to the will of foreign companies to keep their power. This is more foreign companies bending to the will of the Chinese government so they can keep their profits.
  - paulie_a 7y ago
    It's not like China respects IP anyways.
- olalonde 7y ago
  > What's crazier is that the strategy of economically integrating China with the world was a Rebublican economic-liberal one to start with. Why is that crazy? Economic-liberals in the US have mostly been Republicans historically.
  - trymas 7y ago
    I think OP meant, that it's ironic.
    - 7y ago
cinquemb 7y ago
What has damaged the US chip industry is the overeliance upon old IP for "new" products, combined with lack of investment in industries that would benefit from more cutting edge tech, thus enabling state owned manufactures in china to eat their lunch in asia in this upcoming decade. You'd have to be really on the pipe to ignore the declining sales volume of derivative products the past couple of years (masked quite nicely by corporates willing to buy back shares and employ a host of reporting tricks) before this trade war™ nonsense.
- benj111 7y ago
  "overeliance upon old IP", "lack of investment". What are you referring to here? The amount of capital required to develop new nodes means theres only 2 companies left actually competing at the cutting edge. And I would suspect the half life for chip IP is shorter than just about any other manufacturing industry.
  - cinquemb 7y ago
    I'm trying to find an interview someone from Horseman Global gave with Real Vision sometime in the past couple of months that went into the percentage of profits from semiconductor companies that came from lines released pre-2000 vs after (not sure on the exact dates) but it followed the 80-20 rule. And I don't think there is a lack of investment in general, just a lack of (successful) investment in companies that could use some of the newer stuff. Obviously they still have their R&D, but it means very little if they don't have successful (profits/revenue, not VC investment zombies like Magic Leap) companies buying their latest and greatest. It would also have been extremely negligent of such companies to have ignored the monetary/economic security aspects regarding Chinese incentives. Last year, China imported about $270 billion worth of foreign semi-conductors, a lot of which came from the US or at least on US patents. Them solving that alone with a domestic industry by any means would increase their asset-liability spread to the USD by nearly 30%, and free up USD to put to work stabilizing their banking system.
    - benj111 7y ago
      "profits from semiconductor companies that came from lines released pre-2000 vs after" If you look at industrial applications though. The machine you start designing today probably will use chips designed at least 5 years ago, if its another 5 years before your machine hits the market, that's 10 years before the end consumer even gets their hands on the product. Then you're going to be selling that machine for 10 years, and that machine is going to be running and getting maintained for what? 10 years minimum. But those pre 2000 aren't competitive from a performance pov. I had a Pentium 333 with 32mb of ram in 2000. That's basically microcontroller territory now, something equivalent should cost me pence to buy now, if I were doing it clean slate. Regarding 'successful' investment. Perhaps? But then there's plenty of capital sloshing around at the moment, I would question why they haven't attracted investment in such a situation. To put it more directly, what do you know that people with billions to invest, and access the experts in the field don't?
bhouston 7y ago
I am pretty sure that China is going to take a temporary hit but in the end they will emerge stronger than ever. I think China will also redouble on their efforts to be full self-sufficient in all high tech areas, even if they have to open up for a sanction relief deal, their population will so favor local competitors, that it won't matter. China's rise will continue and dominant until their demographic bubble bursts and they turn into Japan when a falling population. I am curious if China can change course on its demographics in a way that Japan couldn't? Tech dominance is all but assured but if the demographics issue isn't resolved, they will clearly stagnant.
- gambiting 7y ago
  Yes, I'm curious what might happen if China gets to a level where they have the best tech, but are not interested in sharing it.
  - yoz-y 7y ago
    It seems to be already happening in genetics research.
    - deugtniet 7y ago
      Really? How? What? Where? I honestly have no idea in what case / field the Chinese groups are miles ahead of anybody else in terms of genetics research. And I'm doing a PhD in the subject. There are excellent groups in all countries, but in terms of superior tech on any side, I have not seen any. There are great companies that facilitate genetics research, but the best tech in that case still is American (Illumina, Affymetrix, 10X genomics).
      - usmonopoly 7y ago
        > There are great companies that facilitate genetics research, but the best tech in that case still is American (Illumina, Affymetrix, 10X genomics). Company IP is up for theft, one way or the other. I think, that is not going to be an edge for long - given the amount of Capital China has amassed.
seren 7y ago
I believe this not only affecting the US. I still have not quite understood the deal around ARM, that will stop cooperating with Huawei. This is a UK based company, owned by a Japanese conglomerate, Softbank, but they were still affected because they have a development center in Texas. The logical conclusion would be that if you are a global company and want to keep selling to China (or to whoever will get a trade ban or sanction), you should not incorporate any US tech, or have US development teams. This seems to be quite counterproductive from the US point of view, it means that investing in the US expose you to additional risks.
- geogra4 7y ago
  I think your last paragraph is very much missed by trump and his team.
  - mistermann 7y ago
    I'm curious what your thinking is behind this. Ok, maybe you're a believer in the Trump's an idiot meme, fine, but do you actually think not a single person on Trump's trade team understands that trade wars are a high risk undertaking, that it might not be a complete cakewalk? Take Robert Lighthizer for example: https://www.politico.com/story/2018/05/22/china-japan-lighthizer-trump-602657 https://www.politico.com/story/2018/05/22/china-japan-lighth... https://www.cnbc.com/2019/06/18/watch-robert-lighthizer-testifies-to-senate-about-trump-trade-agenda.html https://www.cnbc.com/2019/06/18/watch-robert-lighthizer-test... I wouldn't for a moment think he doesn't understand the risks involved, so I would be very interested to know what your thinking is...perhaps you're aware of something I'm not? EDIT: I find the pattern of pattern of downvoting on political topics increasingly disappointing. The specific point of contention here is now whether this trade war strategy will turn out to be a wise move, or could have been executed in a more intelligent manner (I personally hold no certainty on either), it is whether: "The logical conclusion would be that if you are a global company and want to keep selling to China (or to whoever will get a trade ban or sanction), you should not incorporate any US tech, or have US development teams. This seems to be quite counterproductive from the US point of view, it means that investing in the US expose you to additional risks. " ...is very much missed by trump and his team. From a "pedantically" logical perspective, I would interpret a downvote as a belief that no one on Trump's team is able to understand or has not thought of this (and many other obvious) possible negative consequences. More likely I suspect I am reading way too much meaning into downvotes and the actual sentiment is something more casual along the lines of "you're just wrong", but the level of discourse, partisanship and epistemic humility on such topics, often accompanied by an air of intellectual superiority, seems to me like far less than what HN is capable of if we were able to set aside our understandable frustrations. If we can't discuss these topics in a non-tribal, evidence-based manner, then how does one hold the belief that the general public "should" do so? I should also note that I'm far from guilt-free on this matter, but I have been making a sincere effort to be more consistently objective in such discussions, and I would hope that is reflected in my words, provided one is able to set aside our differences in opinions.
blackoil 7y ago
How competitive is Kirin compared to Qualcomm chips. Is it feasible for China govt. to 'motivate' Xiaomi, BBK and other local companies to use it?
- 2a96eb7d685a49c 7y ago
  Kirin SOCs all use ARM Cortex cores[0]. So, the question really is "how competitive is ARM compared to Qualcomm?" However, since ARM has also complied with US restrictions, it doesn't really make sense for other Chinese manufacturers to use them. [0] https://en.wikipedia.org/wiki/HiSilicon#Kirin_980 https://en.wikipedia.org/wiki/HiSilicon#Kirin_980
adambware 7y ago
Serious question - Has this trade war actually helped any U.S. industry?
- goodside 7y ago
  Domestic steel and coal production, which is why Trump is uniquely popular in the rural areas surrounding Pittsburgh.
  - ohlookabird 7y ago
    I am not so sure about that. These are graphs for steel production in the US: https://tradingeconomics.com/united-states/steel-production https://tradingeconomics.com/united-states/steel-production Looking at 5 years or more there doesn't seem to be such big increase in steel production. And coal is in decline: https://tradingeconomics.com/united-states/industrial-production-mining-coal-mining-fed-data.html https://tradingeconomics.com/united-states/industrial-produc... Also I read quite a few articles over the last year about closing down of coal mines, mainly in PA and WV.
    - tinus_hn 7y ago
      Some people just vote for the person with the best-sounding promises. Results matter less than you might think.
    - adventured 7y ago
      The US steel industry is in better economic shape now than it has been in decades. Nucor is nearly worth more than ArcelorMittal and earned more last quarter than ArcelorMittal did. Unthinkable just a few years ago. Nucor's sales jumped from $16b to $25b in two years up through fiscal 2018. Net income jumped from $80m in 2015, to $2.3 billion in 2018 (operating income went from $654m to $3.3b). US Steel Corporation saw its sales jump from $10b to $14b over two years through 2018, net income jumped from negative $1.6b in 2015 to positive $1.1b (operating income went from -$525m to +$950m over that time). The US steel industry has been a disaster for decades. Now it's one of the strongest in the world financially. China's steel companies are hemorrhaging and require constant state support stimulus by comparison. We can either have a healthy, strong domestic steel industry, or we can do nothing and watch China put it into the ground through dumping and massive state subsidies. I don't agree with any state protectionism. So long as China gets away with what they've been doing for decades in industries like steel, I agree with protecting important domestic industries. Steel companies (whether they're in the US or elsewhere) are directly competing with the Chinese state, the US state should intervene given the playing field is very uneven.
dproblem 7y ago
Any country that is dealing with China today should think twice. A dictatorship (till death do us part) with brains - capitalism - faster than the capitalists. China wants to grow, at everyone else's expense. Walking shoulder to shoulder with every terrorist nation on the planet (You know a person from the friends they keep). Suppression (Tibet, Hongkong, Taiwan). I think its time the world woke up? I am glad the Trump team is listening.
- saiya-jin 7y ago
  The Blonde's administration and open support for barbaric regimes and murderers like Saudi prince, Erdogan etc. does much more evil in this world than what China did in last 10 years. Even if it would be equal, US can't have any moral high ground in today's world. They could fix tons of problems if they really wanted. But in reality Russians had to enter fight with ISIS to actually make a change. Makes you wonder if US army is really that incompetent or politics took over as usually.
  - dractori 7y ago
    China has over a million people in concentration camps right now https://en.wikipedia.org/wiki/Xinjiang_re-education_camps https://en.wikipedia.org/wiki/Xinjiang_re-education_camps
    - hugi 7y ago
      And the US seems to really envy them, getting off to a slow start with just a few measly Mexican kids in their camps.
      - atomi 7y ago
        Indigenous Central Americans. Immigration from Mexico is near zero or negative. https://www.pewresearch.org/fact-tank/2019/06/12/5-facts-about-illegal-immigration-in-the-u-s/ https://www.pewresearch.org/fact-tank/2019/06/12/5-facts-abo... Historically, the first people to colonize most of the western United States were Spanish, Mestizos and Mulattos coming up from Mexico not long after Hernán Cortés' conquest - i.e. https://en.m.wikipedia.org/wiki/Los_Angeles_Pobladores https://en.m.wikipedia.org/wiki/Los_Angeles_Pobladores
ptah 7y ago
>To ease the blow, Micron appears to have found a workaround. It said it had recently resumed some shipments to Huawei based on its interpretation of the Trump administration’s restrictions, noting that some goods produced by American companies overseas are not always considered American-made. This sounds like the trade war is discouraging US-based manufacturing
- jjwhitaker 7y ago
  That makes sense. With import tariffs in both countries aimed at goods from the other a firm may find it economically viable to shift production (like Apple) to another country with costs lower than tax paid to customs. That will force US firms to move production out of China and/or the US to cut costs long term, which makes sense. It takes a lot to build a steel mill or DRAM plant and those projects will probably try to weather the storm but other countries can make shirts and plastic toys easily enough. For Micron, they already have manufacturing capacity outside the US but not in China. Defending their legal argument of being a US company that doesn't make US goods is probably hugely cheaper than tariffs. Tariffs probably shouldn't be used like they are here anyway. They can be an incredibly powerful negotiation tactics when applied surgically to industries where production can't shift or is specialized to the target country. Like sanctions they can push a deal from on or off the table but they work best when the countries/economies are mismatched like Iran vs the US+EU. When applied like a blanket you just end up taxing imports without a plan and hurting everyone. There was no obvious need to do so here especially as the lopsided trade deficit (which is not explicitly bad) lends so much leverage to China who does have cash on hand to invest in industry to offset losses while the US has a spiking deficit once again like with the last few GOP administrations.
  - chunkyLafunga 7y ago
    If you look at how China has been applying tariffs on US goods, its surgical, they only tariff goods that they know they can get somewhere else, they haven't put tariffs on anything they they know they can only get from the US.
hnisshit 7y ago
Fuck you HN! Fuck you Paul Graham!
Havoc 7y ago
In other news AMD shares up. Nothing on the stock market makes sense
- tim333 7y ago
  I think an argument for that is AMD have partnered with the Chinese. In the long run if the trade war damages US producers, AMD/China may take a larger share globally.
- zanny 7y ago
  AMD is up because they are eating Intels lunch. The whole pie might shrink with sanctions on China, but AMD is in the process of going from crumbs to a legitimate slice of their own for the first time in over a decade.
bazooka_penguin 7y ago
Well you dont get to be the sole superpower in the world by competing against healthy opponents with natural advantages. The reality is Americans are not so competitive, let's say, against other hungrier demographics. It's really in America's best interest to cripple the Chinese economy, as well as other big competitors coughEU which is where these policies are coming from. Otherwise you cant win against a relatively high tech country with a massive population being pushed through STEM and a heavy handed government that orchestrates a great deal of their technological pursuits for the purpose of strengthening the country so as to position it against global competitors, as opposed to say lining pockets or pandering to a base.
- sfkdjf9j3j 7y ago
  It's really in America's best interest to cripple the Chinese economy, as well as other big competitors coughEU which is where these policies are coming from. No, it is not in America's best interest to cripple the economies of its trading partners. That's absolutely absurd.
  - bazooka_penguin 7y ago
    America's hegemony is based entirely on the fact that it's the dominant economy, not merely a large one. If the EU or China (who has even called to replace the USD as the global currency) overtook the US then other nations would defer to them over the US. That's the end of the american empire

186 points by ETHisso2017 7y ago

Only 8.4% of US exports are to China, but the number is probably higher for semiconductors. It would have been nice if the article had mentioned what that number actually is.

mytailorisrich 7y ago
Found this [0]: "The U.S. semiconductor industry generates 30 percent of total revenue from China, with Qualcomm and Micron accruing more than half of sales from trade with Beijing." [0]: https://www.cnbc.com/2018/11/27/us-china-tensions-put-chipmakers-apple-in-hot-water-ahead-of-g-20.html https://www.cnbc.com/2018/11/27/us-china-tensions-put-chipma...

scarejunba 7y ago

The semiconductor is game-changing tech. When America allowed the Hygon Dhyana to be made, America fucked up. Hold it back. This is real tech. You can't let it go. I'm for free societies, but free societies must defend themselves from societies organized to kill free societies. The semiconductor is real. Giving away this will pay poor dividends.

inflatableDodo 7y ago
Given that the vast majority of silicon fabrication is not in the USA, I think this ship may have possibly sailed.
amelius 7y ago
Has China yet built their own wafer-stepper?
pjc50 7y ago
This is ridiculous. Semiconductor manufacturing has been globalised for decades. The "other China" has had TSMC since 1987, and they are world leaders. > Hold it back It's technology. Talking about technology is speech. You can have free speech or technology export restrictions but not both. Why do people keep suggesting ways to keep America ""free"" that make it substantially less free? Especially since 9/11.
- simonh 7y ago
  To your last point, because they value their freedom to do things they want, more than they value your freedom to do things you want, and will throw you under a bus to get their way.
- scarejunba 7y ago
  Taiwan is not China.
- inflatableDodo 7y ago
  >It's technology. Talking about technology is speech. Further, the main difference between tools and technology, is story.
simonh 7y ago
Legal restrictions are in place and AMD had to be very careful how they went about it, but at the end of the day much of the technology is not exclusively American at this point. ARM is mainly British technology, owned by a Japanese fund. TSMC is Taiwanese. The Silicon cat is well and truly out of the bag. In fact Hygon Dhyana and Zhaoxin (collaboration with VIA, also Taiwanese) are largely responses to the trade war. Aggressive trade practices may be hurting China economically, but it is significantly accelerating their move towards technological independence.

dkraft 7y ago

This is just narrow thinking. Small minds that took advantage of a business deal, now think they have the clout to use public opinion to resume business or to simply smite the hand slapper. Every time this has happened before new avenues and new players have equalized the players.

pjc50 7y ago

This is the thing that economists have been pointing out for decades: at the country scale, allowing free trade provides productivity benefits to both sides, and restricting it affects both sides. You can't have a trade war without domestic casualties. What's crazier is that the strategy of economically integrating China with the world was a Rebublican economic-liberal one to start with. The plan was to make the rest of the world look like America and be trading partners, providing markets for American companies. Someone forgot the last bit.

ptah 7y ago
i think from china's perspective "providing markets for American companies" is a form of colonialism which they try to mitigate by forcing IP transfer
- gorio 7y ago
  Colonialism tends to imply a shift of influence. A government bending to the will of foreign companies to keep their power. This is more foreign companies bending to the will of the Chinese government so they can keep their profits.
- paulie_a 7y ago
  It's not like China respects IP anyways.
olalonde 7y ago
> What's crazier is that the strategy of economically integrating China with the world was a Rebublican economic-liberal one to start with. Why is that crazy? Economic-liberals in the US have mostly been Republicans historically.
- trymas 7y ago
  I think OP meant, that it's ironic.
  - 7y ago

cinquemb 7y ago

What has damaged the US chip industry is the overeliance upon old IP for "new" products, combined with lack of investment in industries that would benefit from more cutting edge tech, thus enabling state owned manufactures in china to eat their lunch in asia in this upcoming decade. You'd have to be really on the pipe to ignore the declining sales volume of derivative products the past couple of years (masked quite nicely by corporates willing to buy back shares and employ a host of reporting tricks) before this trade war™ nonsense.

benj111 7y ago
"overeliance upon old IP", "lack of investment". What are you referring to here? The amount of capital required to develop new nodes means theres only 2 companies left actually competing at the cutting edge. And I would suspect the half life for chip IP is shorter than just about any other manufacturing industry.
- cinquemb 7y ago
  I'm trying to find an interview someone from Horseman Global gave with Real Vision sometime in the past couple of months that went into the percentage of profits from semiconductor companies that came from lines released pre-2000 vs after (not sure on the exact dates) but it followed the 80-20 rule. And I don't think there is a lack of investment in general, just a lack of (successful) investment in companies that could use some of the newer stuff. Obviously they still have their R&D, but it means very little if they don't have successful (profits/revenue, not VC investment zombies like Magic Leap) companies buying their latest and greatest. It would also have been extremely negligent of such companies to have ignored the monetary/economic security aspects regarding Chinese incentives. Last year, China imported about $270 billion worth of foreign semi-conductors, a lot of which came from the US or at least on US patents. Them solving that alone with a domestic industry by any means would increase their asset-liability spread to the USD by nearly 30%, and free up USD to put to work stabilizing their banking system.
  - benj111 7y ago
    "profits from semiconductor companies that came from lines released pre-2000 vs after" If you look at industrial applications though. The machine you start designing today probably will use chips designed at least 5 years ago, if its another 5 years before your machine hits the market, that's 10 years before the end consumer even gets their hands on the product. Then you're going to be selling that machine for 10 years, and that machine is going to be running and getting maintained for what? 10 years minimum. But those pre 2000 aren't competitive from a performance pov. I had a Pentium 333 with 32mb of ram in 2000. That's basically microcontroller territory now, something equivalent should cost me pence to buy now, if I were doing it clean slate. Regarding 'successful' investment. Perhaps? But then there's plenty of capital sloshing around at the moment, I would question why they haven't attracted investment in such a situation. To put it more directly, what do you know that people with billions to invest, and access the experts in the field don't?

bhouston 7y ago

I am pretty sure that China is going to take a temporary hit but in the end they will emerge stronger than ever. I think China will also redouble on their efforts to be full self-sufficient in all high tech areas, even if they have to open up for a sanction relief deal, their population will so favor local competitors, that it won't matter. China's rise will continue and dominant until their demographic bubble bursts and they turn into Japan when a falling population. I am curious if China can change course on its demographics in a way that Japan couldn't? Tech dominance is all but assured but if the demographics issue isn't resolved, they will clearly stagnant.

gambiting 7y ago
Yes, I'm curious what might happen if China gets to a level where they have the best tech, but are not interested in sharing it.
- yoz-y 7y ago
  It seems to be already happening in genetics research.
  - deugtniet 7y ago
    Really? How? What? Where? I honestly have no idea in what case / field the Chinese groups are miles ahead of anybody else in terms of genetics research. And I'm doing a PhD in the subject. There are excellent groups in all countries, but in terms of superior tech on any side, I have not seen any. There are great companies that facilitate genetics research, but the best tech in that case still is American (Illumina, Affymetrix, 10X genomics).
    - usmonopoly 7y ago
      > There are great companies that facilitate genetics research, but the best tech in that case still is American (Illumina, Affymetrix, 10X genomics). Company IP is up for theft, one way or the other. I think, that is not going to be an edge for long - given the amount of Capital China has amassed.

seren 7y ago

I believe this not only affecting the US. I still have not quite understood the deal around ARM, that will stop cooperating with Huawei. This is a UK based company, owned by a Japanese conglomerate, Softbank, but they were still affected because they have a development center in Texas. The logical conclusion would be that if you are a global company and want to keep selling to China (or to whoever will get a trade ban or sanction), you should not incorporate any US tech, or have US development teams. This seems to be quite counterproductive from the US point of view, it means that investing in the US expose you to additional risks.

geogra4 7y ago
I think your last paragraph is very much missed by trump and his team.
- mistermann 7y ago
  I'm curious what your thinking is behind this. Ok, maybe you're a believer in the Trump's an idiot meme, fine, but do you actually think not a single person on Trump's trade team understands that trade wars are a high risk undertaking, that it might not be a complete cakewalk? Take Robert Lighthizer for example: https://www.politico.com/story/2018/05/22/china-japan-lighthizer-trump-602657 https://www.politico.com/story/2018/05/22/china-japan-lighth... https://www.cnbc.com/2019/06/18/watch-robert-lighthizer-testifies-to-senate-about-trump-trade-agenda.html https://www.cnbc.com/2019/06/18/watch-robert-lighthizer-test... I wouldn't for a moment think he doesn't understand the risks involved, so I would be very interested to know what your thinking is...perhaps you're aware of something I'm not? EDIT: I find the pattern of pattern of downvoting on political topics increasingly disappointing. The specific point of contention here is now whether this trade war strategy will turn out to be a wise move, or could have been executed in a more intelligent manner (I personally hold no certainty on either), it is whether: "The logical conclusion would be that if you are a global company and want to keep selling to China (or to whoever will get a trade ban or sanction), you should not incorporate any US tech, or have US development teams. This seems to be quite counterproductive from the US point of view, it means that investing in the US expose you to additional risks. " ...is very much missed by trump and his team. From a "pedantically" logical perspective, I would interpret a downvote as a belief that no one on Trump's team is able to understand or has not thought of this (and many other obvious) possible negative consequences. More likely I suspect I am reading way too much meaning into downvotes and the actual sentiment is something more casual along the lines of "you're just wrong", but the level of discourse, partisanship and epistemic humility on such topics, often accompanied by an air of intellectual superiority, seems to me like far less than what HN is capable of if we were able to set aside our understandable frustrations. If we can't discuss these topics in a non-tribal, evidence-based manner, then how does one hold the belief that the general public "should" do so? I should also note that I'm far from guilt-free on this matter, but I have been making a sincere effort to be more consistently objective in such discussions, and I would hope that is reflected in my words, provided one is able to set aside our differences in opinions.

blackoil 7y ago

How competitive is Kirin compared to Qualcomm chips. Is it feasible for China govt. to 'motivate' Xiaomi, BBK and other local companies to use it?

2a96eb7d685a49c 7y ago
Kirin SOCs all use ARM Cortex cores[0]. So, the question really is "how competitive is ARM compared to Qualcomm?" However, since ARM has also complied with US restrictions, it doesn't really make sense for other Chinese manufacturers to use them. [0] https://en.wikipedia.org/wiki/HiSilicon#Kirin_980 https://en.wikipedia.org/wiki/HiSilicon#Kirin_980

adambware 7y ago

Serious question - Has this trade war actually helped any U.S. industry?

goodside 7y ago
Domestic steel and coal production, which is why Trump is uniquely popular in the rural areas surrounding Pittsburgh.
- ohlookabird 7y ago
  I am not so sure about that. These are graphs for steel production in the US: https://tradingeconomics.com/united-states/steel-production https://tradingeconomics.com/united-states/steel-production Looking at 5 years or more there doesn't seem to be such big increase in steel production. And coal is in decline: https://tradingeconomics.com/united-states/industrial-production-mining-coal-mining-fed-data.html https://tradingeconomics.com/united-states/industrial-produc... Also I read quite a few articles over the last year about closing down of coal mines, mainly in PA and WV.
  - tinus_hn 7y ago
    Some people just vote for the person with the best-sounding promises. Results matter less than you might think.
  - adventured 7y ago
    The US steel industry is in better economic shape now than it has been in decades. Nucor is nearly worth more than ArcelorMittal and earned more last quarter than ArcelorMittal did. Unthinkable just a few years ago. Nucor's sales jumped from $16b to $25b in two years up through fiscal 2018. Net income jumped from $80m in 2015, to $2.3 billion in 2018 (operating income went from $654m to $3.3b). US Steel Corporation saw its sales jump from $10b to $14b over two years through 2018, net income jumped from negative $1.6b in 2015 to positive $1.1b (operating income went from -$525m to +$950m over that time). The US steel industry has been a disaster for decades. Now it's one of the strongest in the world financially. China's steel companies are hemorrhaging and require constant state support stimulus by comparison. We can either have a healthy, strong domestic steel industry, or we can do nothing and watch China put it into the ground through dumping and massive state subsidies. I don't agree with any state protectionism. So long as China gets away with what they've been doing for decades in industries like steel, I agree with protecting important domestic industries. Steel companies (whether they're in the US or elsewhere) are directly competing with the Chinese state, the US state should intervene given the playing field is very uneven.

dproblem 7y ago

Any country that is dealing with China today should think twice. A dictatorship (till death do us part) with brains - capitalism - faster than the capitalists. China wants to grow, at everyone else's expense. Walking shoulder to shoulder with every terrorist nation on the planet (You know a person from the friends they keep). Suppression (Tibet, Hongkong, Taiwan). I think its time the world woke up? I am glad the Trump team is listening.

saiya-jin 7y ago
The Blonde's administration and open support for barbaric regimes and murderers like Saudi prince, Erdogan etc. does much more evil in this world than what China did in last 10 years. Even if it would be equal, US can't have any moral high ground in today's world. They could fix tons of problems if they really wanted. But in reality Russians had to enter fight with ISIS to actually make a change. Makes you wonder if US army is really that incompetent or politics took over as usually.
- dractori 7y ago
  China has over a million people in concentration camps right now https://en.wikipedia.org/wiki/Xinjiang_re-education_camps https://en.wikipedia.org/wiki/Xinjiang_re-education_camps
  - hugi 7y ago
    And the US seems to really envy them, getting off to a slow start with just a few measly Mexican kids in their camps.
    - atomi 7y ago
      Indigenous Central Americans. Immigration from Mexico is near zero or negative. https://www.pewresearch.org/fact-tank/2019/06/12/5-facts-about-illegal-immigration-in-the-u-s/ https://www.pewresearch.org/fact-tank/2019/06/12/5-facts-abo... Historically, the first people to colonize most of the western United States were Spanish, Mestizos and Mulattos coming up from Mexico not long after Hernán Cortés' conquest - i.e. https://en.m.wikipedia.org/wiki/Los_Angeles_Pobladores https://en.m.wikipedia.org/wiki/Los_Angeles_Pobladores

ptah 7y ago

>To ease the blow, Micron appears to have found a workaround. It said it had recently resumed some shipments to Huawei based on its interpretation of the Trump administration’s restrictions, noting that some goods produced by American companies overseas are not always considered American-made. This sounds like the trade war is discouraging US-based manufacturing

jjwhitaker 7y ago
That makes sense. With import tariffs in both countries aimed at goods from the other a firm may find it economically viable to shift production (like Apple) to another country with costs lower than tax paid to customs. That will force US firms to move production out of China and/or the US to cut costs long term, which makes sense. It takes a lot to build a steel mill or DRAM plant and those projects will probably try to weather the storm but other countries can make shirts and plastic toys easily enough. For Micron, they already have manufacturing capacity outside the US but not in China. Defending their legal argument of being a US company that doesn't make US goods is probably hugely cheaper than tariffs. Tariffs probably shouldn't be used like they are here anyway. They can be an incredibly powerful negotiation tactics when applied surgically to industries where production can't shift or is specialized to the target country. Like sanctions they can push a deal from on or off the table but they work best when the countries/economies are mismatched like Iran vs the US+EU. When applied like a blanket you just end up taxing imports without a plan and hurting everyone. There was no obvious need to do so here especially as the lopsided trade deficit (which is not explicitly bad) lends so much leverage to China who does have cash on hand to invest in industry to offset losses while the US has a spiking deficit once again like with the last few GOP administrations.
- chunkyLafunga 7y ago
  If you look at how China has been applying tariffs on US goods, its surgical, they only tariff goods that they know they can get somewhere else, they haven't put tariffs on anything they they know they can only get from the US.

hnisshit 7y ago

Fuck you HN! Fuck you Paul Graham!

Havoc 7y ago

In other news AMD shares up. Nothing on the stock market makes sense

tim333 7y ago
I think an argument for that is AMD have partnered with the Chinese. In the long run if the trade war damages US producers, AMD/China may take a larger share globally.
zanny 7y ago
AMD is up because they are eating Intels lunch. The whole pie might shrink with sanctions on China, but AMD is in the process of going from crumbs to a legitimate slice of their own for the first time in over a decade.

bazooka_penguin 7y ago

Well you dont get to be the sole superpower in the world by competing against healthy opponents with natural advantages. The reality is Americans are not so competitive, let's say, against other hungrier demographics. It's really in America's best interest to cripple the Chinese economy, as well as other big competitors coughEU which is where these policies are coming from. Otherwise you cant win against a relatively high tech country with a massive population being pushed through STEM and a heavy handed government that orchestrates a great deal of their technological pursuits for the purpose of strengthening the country so as to position it against global competitors, as opposed to say lining pockets or pandering to a base.

sfkdjf9j3j 7y ago
It's really in America's best interest to cripple the Chinese economy, as well as other big competitors coughEU which is where these policies are coming from. No, it is not in America's best interest to cripple the economies of its trading partners. That's absolutely absurd.
- bazooka_penguin 7y ago
  America's hegemony is based entirely on the fact that it's the dominant economy, not merely a large one. If the EU or China (who has even called to replace the USD as the global currency) overtook the US then other nations would defer to them over the US. That's the end of the american empire