4 ms·

Environmental, labour, safety and energy are the usual 4 horsemen that I have seen. Just listing a random point from my collection of squeaky-wheel arguments on

by roenxi 3y ago

Environmental, labour, safety and energy are the usual 4 horsemen that I have seen. Just listing a random point from my collection of squeaky-wheel arguments on the topic: * I frankly don't know how to make it a persuasive message, but my experience in English speaking countries is that it is generally illegal to make mistakes or skimp on quality. That means it is impossible for industries to learn how to do new things. Look at the treatment of Boeing after 2 airplane crashes for example and ask what that would mean for a new company attempting to learn how to operate in the space. With no room to fail, it is a challenge for new companies to succeed. There were even calls to nationalise them which is ... not likely but also not comforting as an investor. It is darn risky to put money into manufacturing spaces with attitudes like that, it is safer to go with cat picture delivery platforms. * The US has particulate air pollution that is half of South Korea's and a quarter of China. It is a pretty reasonable guess that air pollution would be mostly industrial production that the US would shut down for environmental concerns. * US labour laws are an impediment. That new fab plant that TSMC was trying to build in the US seemed to be falling over because it was illegal to use skilled, experienced labour. * The US is seeing declines in per-capita energy availability and flat actual production. That is almost certainly a policy choice linked to anti-fossil-fuel ideologies, Asia has been seeing seeing crazy growth. It is hard to do energy-intensive activities like manufacturing in an environment where securing energy is a battle. There have been something like 50 years of anti-industrial policy in the west. A lot of the capital was built in China/Asia. It should be a literal embarrassment that we're being outdone at capitalism by nominal communists and legitimate authoritarians.

pmontra 3y ago
Capitalism is not at odds with authoritarianism. They are orthogonal. The only thing capitalists must not do in those places is piss off the dear liders of their country.
- roenxi 3y ago
  Yeah. How could the Chinese out-capital the US if capitalism was at odds with authoritarianism? But unless it adopts some really stupid ideologies a liberal system should be able to produce more and better capitalists than an authoritarian one. Free markets breed capitalists like dropped donuts attract ants. It isn't like China is getting the best value out of their billion-odd people; the inefficiencies caused by over-centralisation there are still breathtaking and tragic.
anonymous-panda 3y ago
> Look at the treatment of Boeing after 2 airplane crashes for example Well, Boeing was taken to task not for trying to innovate and making mistakes but for lying (fraud) and regulatory capture of the FAA (something a smaller competitor can’t do and in fact likely prevents smaller competitors). As an investor, the former should make you wary and as a flier the latter should make you scared. > The US has particulate air pollution that is half of South Korea's and a quarter of China. It is a pretty reasonable guess that air pollution would be mostly industrial production that the US would shut down for environmental concerns. Considering the primary stated motivator by many industrial companies for outsourcing to China was labor costs and not environmental regulations, I wouldn’t be so confident in this claim. This is borne out by research which tries to compare environmental regulations across regulatory regimes: > In our newest research, we compared risk regulation in China and the United States, and we have also found a more complex pattern that does not support the longstanding conventional view of U.S. regulation being much more stringent than in China. https://www.theregreview.org/2021/12/20/xu-wiener-comparing-us-chinese-environmental-risk-regulation/ https://www.theregreview.org/2021/12/20/xu-wiener-comparing-... > * US labour laws are an impediment. That new fab plant that TSMC was trying to build in the US seemed to be falling over because it was illegal to use skilled, experienced labour. I don’t know what you’re referring to but generally the problems with such endeavors are that skilled work in a different cultural and regulatory environment is challenging and this applies to European companies trying to enter the US market and US companies trying to enter other markets for the first time too, especially when it comes to complex technical projects. Also, the primary labor laws that tend to be an impediment are things like worker safety and compensation. The latter is a bit less important for highly skilled labor but safety is certainly not. I think the bigger problem is trade arrangements that have long ignored these rather than estimating the cost worker safety regulations impose and taxing products from regimes that don’t have good regulations. > The US is seeing declines in per-capita energy availability and flat actual production. That is almost certainly a policy choice linked to anti-fossil-fuel ideologies, Asia has been seeing seeing crazy growth. It is hard to do energy-intensive activities like manufacturing in an environment where securing energy is a battle. That seems like a leap when China is installing a lot of nuclear and solar energy. Yes they’re also still building coal plants but that’s intended to be as a backstop for solar until they build enough nuclear capacity. > It should be a literal embarrassment that we're being outdone at capitalism by nominal communists China hasn’t really been a communist country in anything more than name for quite a while and is actually pretty capitalist despite their own claims to the contrary (they still like to pretend): https://www.cato.org/policy-report/january/february-2013/how-china-became-capitalist https://www.cato.org/policy-report/january/february-2013/how... You seem to like to state something that may be true but jump to a conclusion without any supporting evidence for making that claim. I’ve noticed Tucker Carlson does the same thing (at least on the Lex Friedman interview as I generally find him an insufferable blowhard) and it’s quite annoying.
Aloha 3y ago
Boeing wrote most of the book on how to do this stuff safely - they just stopped following that book once they bought MDC and its management took over (and arguable laid off the engineering people at MDC who could do it the MDC way safely). Thats why Boeing is trying to undo it, and repurchase Spirit Aerosystems.
- roenxi 3y ago
  Note the past-tense in that opening though. The aircraft industry moved from a less-safe state to a more-safe state, then less-safe states were banned. This raises the question of how feasible it'd be to build new companies. The way that is proven to work (start less safe, then ratchet up standards) is no longer possible because the start of the path has been made illegal. The people who are outcompeting the US are not doing it by starting at the low end and working up.
  - Aloha 3y ago
    There is absolutely no reason why you couldn't meet the accepted safety standards for this industry as a startup.
    - roenxi 3y ago
      There is an excellent reason; startups generally have no idea what they are doing and are very sloppy compared to an established company. Not only that, but they have to be trying to do things differently - otherwise there was no point starting a new company. Those two factors add up to unsafe practices. It is likely enough that it needs to be factored into investment plans.
      - Aloha 3y ago
        In aviation specifically the standards and practices for the industry are widely available (start with the public domain retrospectives from Project Apollo). I'm going to note that SpaceX does not seem to be struggling beyond what I would expect to develop a new heavy lift system. Yes, lots of RUD moments, but not an unexpected amount. I actually agree with you in broad terms, we do have too much hard to follow regulation - but Aviation isn't one of those cases - every rule we have in that sector was paid for in lives.

by roenxi 3y ago

pmontra 3y ago

Capitalism is not at odds with authoritarianism. They are orthogonal. The only thing capitalists must not do in those places is piss off the dear liders of their country.

roenxi 3y ago
Yeah. How could the Chinese out-capital the US if capitalism was at odds with authoritarianism? But unless it adopts some really stupid ideologies a liberal system should be able to produce more and better capitalists than an authoritarian one. Free markets breed capitalists like dropped donuts attract ants. It isn't like China is getting the best value out of their billion-odd people; the inefficiencies caused by over-centralisation there are still breathtaking and tragic.

anonymous-panda 3y ago

> Look at the treatment of Boeing after 2 airplane crashes for example Well, Boeing was taken to task not for trying to innovate and making mistakes but for lying (fraud) and regulatory capture of the FAA (something a smaller competitor can’t do and in fact likely prevents smaller competitors). As an investor, the former should make you wary and as a flier the latter should make you scared. > The US has particulate air pollution that is half of South Korea's and a quarter of China. It is a pretty reasonable guess that air pollution would be mostly industrial production that the US would shut down for environmental concerns. Considering the primary stated motivator by many industrial companies for outsourcing to China was labor costs and not environmental regulations, I wouldn’t be so confident in this claim. This is borne out by research which tries to compare environmental regulations across regulatory regimes: > In our newest research, we compared risk regulation in China and the United States, and we have also found a more complex pattern that does not support the longstanding conventional view of U.S. regulation being much more stringent than in China. https://www.theregreview.org/2021/12/20/xu-wiener-comparing-us-chinese-environmental-risk-regulation/ https://www.theregreview.org/2021/12/20/xu-wiener-comparing-... > * US labour laws are an impediment. That new fab plant that TSMC was trying to build in the US seemed to be falling over because it was illegal to use skilled, experienced labour. I don’t know what you’re referring to but generally the problems with such endeavors are that skilled work in a different cultural and regulatory environment is challenging and this applies to European companies trying to enter the US market and US companies trying to enter other markets for the first time too, especially when it comes to complex technical projects. Also, the primary labor laws that tend to be an impediment are things like worker safety and compensation. The latter is a bit less important for highly skilled labor but safety is certainly not. I think the bigger problem is trade arrangements that have long ignored these rather than estimating the cost worker safety regulations impose and taxing products from regimes that don’t have good regulations. > The US is seeing declines in per-capita energy availability and flat actual production. That is almost certainly a policy choice linked to anti-fossil-fuel ideologies, Asia has been seeing seeing crazy growth. It is hard to do energy-intensive activities like manufacturing in an environment where securing energy is a battle. That seems like a leap when China is installing a lot of nuclear and solar energy. Yes they’re also still building coal plants but that’s intended to be as a backstop for solar until they build enough nuclear capacity. > It should be a literal embarrassment that we're being outdone at capitalism by nominal communists China hasn’t really been a communist country in anything more than name for quite a while and is actually pretty capitalist despite their own claims to the contrary (they still like to pretend): https://www.cato.org/policy-report/january/february-2013/how-china-became-capitalist https://www.cato.org/policy-report/january/february-2013/how... You seem to like to state something that may be true but jump to a conclusion without any supporting evidence for making that claim. I’ve noticed Tucker Carlson does the same thing (at least on the Lex Friedman interview as I generally find him an insufferable blowhard) and it’s quite annoying.

Aloha 3y ago

Boeing wrote most of the book on how to do this stuff safely - they just stopped following that book once they bought MDC and its management took over (and arguable laid off the engineering people at MDC who could do it the MDC way safely). Thats why Boeing is trying to undo it, and repurchase Spirit Aerosystems.

roenxi 3y ago
Note the past-tense in that opening though. The aircraft industry moved from a less-safe state to a more-safe state, then less-safe states were banned. This raises the question of how feasible it'd be to build new companies. The way that is proven to work (start less safe, then ratchet up standards) is no longer possible because the start of the path has been made illegal. The people who are outcompeting the US are not doing it by starting at the low end and working up.
- Aloha 3y ago
  There is absolutely no reason why you couldn't meet the accepted safety standards for this industry as a startup.
  - roenxi 3y ago
    There is an excellent reason; startups generally have no idea what they are doing and are very sloppy compared to an established company. Not only that, but they have to be trying to do things differently - otherwise there was no point starting a new company. Those two factors add up to unsafe practices. It is likely enough that it needs to be factored into investment plans.
    - Aloha 3y ago
      In aviation specifically the standards and practices for the industry are widely available (start with the public domain retrospectives from Project Apollo). I'm going to note that SpaceX does not seem to be struggling beyond what I would expect to develop a new heavy lift system. Yes, lots of RUD moments, but not an unexpected amount. I actually agree with you in broad terms, we do have too much hard to follow regulation - but Aviation isn't one of those cases - every rule we have in that sector was paid for in lives.