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>Why should the US allow Chinese companies to operate in the US? The US gains very substantial economic benefits from being an attractive place for internation

>Why should the US allow Chinese companies to operate in the US? The US gains very substantial economic benefits from being an attractive place for international companies to do business. Foreign investors know that when they invest in America, they're getting a stable regulatory environment and a reasonably trustworthy civil legal system. If America decides to undermine that trust for short-term gain, there will be a substantial long-term cost. You might believe that hostile trade policies prevent American companies from competing in the Chinese market, but that's starkly contradicted by the number of American companies for whom China is a key market. Apple earn $11bn a year in China. Wal-Mart have thousands of stores there. Yum! Brands (KFC, Pizza Hut and Taco Bell) have 40% of the Chinese fast food market and make more revenue there than anywhere else. Starbucks have 70% of the Chinese coffee market. The shelves of Chinese convenience stores are groaning with American-owned brands. An all-out trade war with China might be appealing, but be under no illusions that it'll be all upside for America. If China want to put the hurt on America, they have more levers to pull and more staying power. It's definitely not a fight you want to lose, but it might not even be a fight worth winning. China aren't thinking about next quarter or next year, they're thinking about the next generation. Where does the US see itself in 2050?

godtoldmetodoit 6y ago
I highly doubt China has more levers then the US when it comes to a trade war. China can't feed itself past subsistence level without imports. https://www.bloomberg.com/graphics/2017-feeding-china/ https://www.bloomberg.com/graphics/2017-feeding-china/ China runs on oil just like every other modern economy, and they have pitiful amounts locally. They are the largest importer in the world and they absolutely need it to keep flowing. https://www.forbes.com/sites/judeclemente/2019/10/17/china-is-the-worlds-largest-oil--gas-importer/#687831345441 https://www.forbes.com/sites/judeclemente/2019/10/17/china-i... The US can feed itself domestically, and we can supply our own energy domestically. All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly. Note - I'm not even saying we have to attack them, we just stop responding to any requests for help from them and let the world know. China relies on the US enforced world order to survive in its current form. The US relies on China for convenience, not for survival. Would it be wise to do what I just said? I don't know, and I'm not advocating for it, I just find it funny when people say China would so obviously win a trade war when they are definitely in the worse position at a fundamental level.
- jdietrich 6y ago
  >China can't feed itself... China runs on oil That's only a problem if the rest of the world sides with the US in a US-China trade dispute. There are plenty of net exporters of oil and food who would be very happy to sell to China and would be rather pleased to see the US get a bloody nose. >All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly. China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability. The US relies on China for convenience, not for survival. US hospitals would rapidly degrade to third-world conditions without imports of Chinese-made supplies and materials. COVID-19 has revealed the fragility of global supply chains and the position of China as a manufacturing superpower. If you need a sufficiently large quantity of pretty much anything made, you don't have many options outside of China - doubly so if you need it in a hurry. If China decides to tighten the noose on American consumers, you're going to immediately see severe shortages of even the most basic goods. A total trade war between China and the US would of course have a catastrophic impact on US export revenues because of American reliance on outsourcing - US sanctions on Huawei have had a significant but manageable impact on their smartphone business, but Chinese sanctions on Apple would be catastrophic.
  - will4274 6y ago
    > China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability. Lmao. The US Navy has roughly 3x the strength of all the other navies in the world combined. If the US and China went to war, the US would control the seas in about a month.
    - mastevb 6y ago
      > the US would control the seas in about a month. Lmao. Is this another "home by Christmas"?
mindslight 6y ago
This action is unfortunately part of the normal progression of disruptive innovation. Upstart China has adopted a disruptive strategy of engaging with world markets while using heavy-handed regulation to avoid being controlled by those markets. Incumbent USG is now copying China's strategy, claiming that doing so is necessary to keep the US competitive. However, the US is a world leader through free markets and open collaboration, deferring control to markets even to the detriment of our own citizens. What copying China's strategy will actually do is cannibalize the US's existing economic structure, causing extreme damage to the US.
- jdietrich 6y ago
  Bang on the money, except for one thing - the USG is copying China's tactics, with no real understanding of the strategy.
alexryan 6y ago
If this were purely a battle for economic gain, as many in Silicon Valley are inclined to believe, then you are certainly correct that the CCP has more staying power. But, with respect, I think you vastly underestimate the human desire for freedom from tyranny. This ends when the Chinese overthrow the CCP and China takes its rightful place amongst the democratic nations.

godtoldmetodoit 6y ago

I highly doubt China has more levers then the US when it comes to a trade war. China can't feed itself past subsistence level without imports. https://www.bloomberg.com/graphics/2017-feeding-china/ https://www.bloomberg.com/graphics/2017-feeding-china/ China runs on oil just like every other modern economy, and they have pitiful amounts locally. They are the largest importer in the world and they absolutely need it to keep flowing. https://www.forbes.com/sites/judeclemente/2019/10/17/china-is-the-worlds-largest-oil--gas-importer/#687831345441 https://www.forbes.com/sites/judeclemente/2019/10/17/china-i... The US can feed itself domestically, and we can supply our own energy domestically. All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly. Note - I'm not even saying we have to attack them, we just stop responding to any requests for help from them and let the world know. China relies on the US enforced world order to survive in its current form. The US relies on China for convenience, not for survival. Would it be wise to do what I just said? I don't know, and I'm not advocating for it, I just find it funny when people say China would so obviously win a trade war when they are definitely in the worse position at a fundamental level.

jdietrich 6y ago
>China can't feed itself... China runs on oil That's only a problem if the rest of the world sides with the US in a US-China trade dispute. There are plenty of net exporters of oil and food who would be very happy to sell to China and would be rather pleased to see the US get a bloody nose. >All we have to do is no longer put merchants heading toward China under the US navies protection and the CCP will be in serious trouble very quickly. China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability. The US relies on China for convenience, not for survival. US hospitals would rapidly degrade to third-world conditions without imports of Chinese-made supplies and materials. COVID-19 has revealed the fragility of global supply chains and the position of China as a manufacturing superpower. If you need a sufficiently large quantity of pretty much anything made, you don't have many options outside of China - doubly so if you need it in a hurry. If China decides to tighten the noose on American consumers, you're going to immediately see severe shortages of even the most basic goods. A total trade war between China and the US would of course have a catastrophic impact on US export revenues because of American reliance on outsourcing - US sanctions on Huawei have had a significant but manageable impact on their smartphone business, but Chinese sanctions on Apple would be catastrophic.
- will4274 6y ago
  > China has a large, modern and highly capable navy. They are perfectly able to protect their own shipping against piracy or any state-level actor that would be insane enough to start a naval war. In the event of a direct conflict, the American navy is largely defenceless against the Chinese ASBM capability. Lmao. The US Navy has roughly 3x the strength of all the other navies in the world combined. If the US and China went to war, the US would control the seas in about a month.
  - mastevb 6y ago
    > the US would control the seas in about a month. Lmao. Is this another "home by Christmas"?

mindslight 6y ago

This action is unfortunately part of the normal progression of disruptive innovation. Upstart China has adopted a disruptive strategy of engaging with world markets while using heavy-handed regulation to avoid being controlled by those markets. Incumbent USG is now copying China's strategy, claiming that doing so is necessary to keep the US competitive. However, the US is a world leader through free markets and open collaboration, deferring control to markets even to the detriment of our own citizens. What copying China's strategy will actually do is cannibalize the US's existing economic structure, causing extreme damage to the US.

jdietrich 6y ago
Bang on the money, except for one thing - the USG is copying China's tactics, with no real understanding of the strategy.

alexryan 6y ago

If this were purely a battle for economic gain, as many in Silicon Valley are inclined to believe, then you are certainly correct that the CCP has more staying power. But, with respect, I think you vastly underestimate the human desire for freedom from tyranny. This ends when the Chinese overthrow the CCP and China takes its rightful place amongst the democratic nations.