3 ms·

Domestically, neither China nor the US leadership can afford to be seen to have lost. In part, this is why win-win outcomes are so fantastically useful in trade

by ggm 2y ago

Domestically, neither China nor the US leadership can afford to be seen to have lost. In part, this is why win-win outcomes are so fantastically useful in trade negotiations, because they respect the difference between each states presentation of the outcome to its voters. "we won" is a better message than "we lost" for everyone. You would think the author of "the art of the deal" would understand when the best option is to give your opponent the appearance of a victory to sell to their community. You would think they would recognize when you also needed the same outcome. (since we know he didn't write the book, this is a rhetorical device)

toomuchtodo 2y ago
China has nothing to lose, they remain committed to exporting to the global market. The US quality of life was built on deflation from importing inexpensive goods at scale. China’s pain will be temporary as they reconfigure their export system, US pain will be permanent. There are not enough US workers or time to build what is being parroted to replace imports with domestic production. Xi is sophisticated, Trump is not. https://news.ycombinator.com/item?id=43617956 https://news.ycombinator.com/item?id=43617956 (citations)
- ggm 2y ago
  I certainly don't disgagree that Xi won't back down soon, nor will Trump. Nor that global trade will continue: When China and Australia entered a dispute, Australia found substitutable markets for most of its sectors exporting in bulk to China, and in the end they came to rational terms quietly. We all feel much better about the diversified markets now. And in like sense while the whole US beef thing is very annoying it's actually under 10% of our total beef exports. But I think you underplay how much damage the US could do to the Chinese economy, if (for instance) they repudiated the debt. Or, if they heavy trading partners to drop favourable trade terms to gain back US markets. I think people would be insane to give in but from time to time this kind of thing happens for a short term win. We recently pumped a shitload-and-a-half of money back into the pacrim island economies, to displace China as a trade and security partner having taken our eye off the "backyard" as it is disparagingly called.
  - toomuchtodo 2y ago
    China has ~1.4B people and will. They lead in 37 of 44 of advanced technologies. They are already a manufacturer to the world not only for low value goods, but also high tech goods. They are the largest buyer of industrial robotics, they have ~540GW of annual solar PV manufacturing capacity (through the entire vertical), and they account for almost 60% of global EV production. They are erecting twice as much wind and solar capacity as every other country combined. The US has ~340M people and offshored anything that isn't financial services, tech, etc. The US has lost the will to build, and only started to recover it under enormous effort (Inflation Reduction Act). There will be blood. I'm not underplaying the damage the US could do to China via trade restrictions, but rather saying whatever the US does, China will not only survive it, they will lean even harder into whatever they believe will lead to their definition of success. As Xi would say, "Eat bitterness" (a Chinese idiom signifying enduring hardship and suffering without complaint, often seen as a virtue of perseverance and resilience). Can Americans endure hardship incurred by a brutal global trade war? If so, for how long? Such a natural experiment is about to occur, which is interesting, exciting, and terrifying simultaneously. Xi Jinping calls on young Chinese to embrace hardship - https://www.thinkchina.sg/society/xi-jinping-calls-young-chinese-embrace-hardship https://www.thinkchina.sg/society/xi-jinping-calls-young-chi... - June 16th, 2023
    - toomuchtodo 2y ago
      'We don't care!' Victor Gao dismisses US market threats after Vance's 'peasants' remark [video] - https://www.youtube.com/watch?v=eb6Ms_SqWtY https://www.youtube.com/watch?v=eb6Ms_SqWtY "We don't care. China has been here for 5,000 years. Most of the time there was no United States, and we survived. And we expect to survive for another 5,000 years."
  - quadragenarian 2y ago
    Could you provide more information on what you mean by "repudiated the debt"? Does this mean reneging on US Treasury bonds? Because that's nuclear. That causes fixed income markets to implode and brings upon GFC 2.0.
- TacticalCoder 2y ago
  [dead]
- fuzzfactor 2y ago
  Xi is not that sophisticated. Trump is abysmal.

by ggm 2y ago

toomuchtodo 2y ago

China has nothing to lose, they remain committed to exporting to the global market. The US quality of life was built on deflation from importing inexpensive goods at scale. China’s pain will be temporary as they reconfigure their export system, US pain will be permanent. There are not enough US workers or time to build what is being parroted to replace imports with domestic production. Xi is sophisticated, Trump is not. https://news.ycombinator.com/item?id=43617956 https://news.ycombinator.com/item?id=43617956 (citations)

ggm 2y ago
I certainly don't disgagree that Xi won't back down soon, nor will Trump. Nor that global trade will continue: When China and Australia entered a dispute, Australia found substitutable markets for most of its sectors exporting in bulk to China, and in the end they came to rational terms quietly. We all feel much better about the diversified markets now. And in like sense while the whole US beef thing is very annoying it's actually under 10% of our total beef exports. But I think you underplay how much damage the US could do to the Chinese economy, if (for instance) they repudiated the debt. Or, if they heavy trading partners to drop favourable trade terms to gain back US markets. I think people would be insane to give in but from time to time this kind of thing happens for a short term win. We recently pumped a shitload-and-a-half of money back into the pacrim island economies, to displace China as a trade and security partner having taken our eye off the "backyard" as it is disparagingly called.
- toomuchtodo 2y ago
  China has ~1.4B people and will. They lead in 37 of 44 of advanced technologies. They are already a manufacturer to the world not only for low value goods, but also high tech goods. They are the largest buyer of industrial robotics, they have ~540GW of annual solar PV manufacturing capacity (through the entire vertical), and they account for almost 60% of global EV production. They are erecting twice as much wind and solar capacity as every other country combined. The US has ~340M people and offshored anything that isn't financial services, tech, etc. The US has lost the will to build, and only started to recover it under enormous effort (Inflation Reduction Act). There will be blood. I'm not underplaying the damage the US could do to China via trade restrictions, but rather saying whatever the US does, China will not only survive it, they will lean even harder into whatever they believe will lead to their definition of success. As Xi would say, "Eat bitterness" (a Chinese idiom signifying enduring hardship and suffering without complaint, often seen as a virtue of perseverance and resilience). Can Americans endure hardship incurred by a brutal global trade war? If so, for how long? Such a natural experiment is about to occur, which is interesting, exciting, and terrifying simultaneously. Xi Jinping calls on young Chinese to embrace hardship - https://www.thinkchina.sg/society/xi-jinping-calls-young-chinese-embrace-hardship https://www.thinkchina.sg/society/xi-jinping-calls-young-chi... - June 16th, 2023
  - toomuchtodo 2y ago
    'We don't care!' Victor Gao dismisses US market threats after Vance's 'peasants' remark [video] - https://www.youtube.com/watch?v=eb6Ms_SqWtY https://www.youtube.com/watch?v=eb6Ms_SqWtY "We don't care. China has been here for 5,000 years. Most of the time there was no United States, and we survived. And we expect to survive for another 5,000 years."
- quadragenarian 2y ago
  Could you provide more information on what you mean by "repudiated the debt"? Does this mean reneging on US Treasury bonds? Because that's nuclear. That causes fixed income markets to implode and brings upon GFC 2.0.
TacticalCoder 2y ago
[dead]
fuzzfactor 2y ago
Xi is not that sophisticated. Trump is abysmal.