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I think Xi has a pretty simple strategy: Dominate every sector of manufacturing (the stuff economy), and steal/fast-follow the West across the information economy. This seems pretty smart!

China will always be able to do whatever information economy stuff the West pours its resources shortly after we do. Look at Ai, self-driving cars, etc. - the US is very slightly ahead, which is basically fine for China.

The West cannot do the same fast-follow to China's manufacturing. Manufacturing can't be stolen or copied. Ongoing unit costs matter much more than development costs. So China is pouring it's entire human capital base into the sector with the international moat.

I don't see how it's not the US that's lacking in strategy here.

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One way to think about this - if an industry relies on:

1. IP Protection (Biotech) or Demand Network Effects (Social Media) it's entirely indefensible across borders.

2. Information advantage (A lot of software, Ai), it's mostly indefensible across borders.

3. Economies of Scale (Most manufacturing), it's somewhat defensible across borders.

4. Supplier Network Effects (Most complex manufacturing), it's very defensible across borders.

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Demand network effects seem to have been very effective in preventing competition to US Big Tech in most parts of the world: China is the one glaring exception because most US Big Tech services are simply shut out of China via the Great Internet Firewall.

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Like IP protection, that works when countries are cooperating. If the US wanted to shut down TikTok today, we'd have something very close to it within six months. If France shut down Instagram, same.

If the US shuts down drone imports, it won't develop a just-as-competitive-drone capacity nearly as easily.

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Except in a sense China is going back to USSR days of focusing on heavy manufacturing and starving light manufacturing: focusing on heavy tech stuff (chips, AI, self-driving cars, etc) and starving light tech stuff (games, education, SaaS, etc). Prioritizing champions over SMEs. Winning the competition at the expense of self-sustainability.

In a sense, China is neglecting industries which do not rely on any of the above.

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But the "West" can improve it's manufacturing capability, particularly if you consider the West to include other non-Chinese Asian and south Asian allies. In fact, this seems to be a growing trend. And then China will have to find markets for its vast manufacturing output, which it seems to be struggling to do.

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We *can*, sure, but it's a lot harder when manufacturing has to compete for talent and capital with lucrative (and cushier, often work-from-home) consumer and SaaS industries (not to mention finance, healthcare and law, which are also draw much more elite talent and capital than than they do in China.)

If the US government tamped down on capital going to finance, HC, law and consumer tech, and made it clear that we were going to prioritize manufacturing as our #1 industry, a whole lot more people would be fighting to get into manufacturing.

All else equal we're not doing that, and China is, so we shouldn't be surprised if China beats us in manufacturing.

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AI is an area where the US doesn't try to keep a competitive advantage. US firms write papers explaining their algorithms, they literally give trained models away for free. If you look at the IP companies that don't do this (e.g. Nvidia) then there are no peer competitors in China.

Manufacturing can certainly be copied. I mean, how do you think China learned how to make stuff? Companies routinely move manufacturing to entirely different countries because factories are relatively easy to move or copy compared to cultures.

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Sep 14·edited Sep 15

Isn't Tyler G's point 3 the main thing that makes Chinese industry in general so hard to beat: the sheer economies of scale from having over a billion people under the control of a single highly centralized government?

His point 4 (supplier network effects) apply to a greater degree to machinery exports dominated by Germany, although China is increasingly gaining an advantage there too.

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I really object to your model of Xi as a conservative American baby boomer. It’s not as though there are no similarities—preoccupation with things that are coded as masculine, contempt for the kids, obsession with restoring his country’s greatness, preference for stability over dynamism, inflexible model of the world, etc.—it’s that Xi Jinping is a genuine Marxist-Leninist, a deep and committed Maoist, and all that entails.

American, conservative baby-boomers are not. On average, they are “get off my lawn!”, church-going, folk libertarians. Each are conservative, in the most basic sense (they want to conserve the institutions and practices of the country they were raised in) but because mid-20th century America and mid-20th century China were extraordinarily different places, the particular form of that conservatism is just so, so different.

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Part of me thinks you are aware of the serious limitations of this analogy, but are aware that you write for a mostly left-of-center audience and are doing your level best to polarize American liberals against Xi.

And if that’s the case. Far be it from me to interrupt you. You’re doing the Lord’s work.

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Yeah but obviously nonsensical claims don't help with that. Calling Xi a conservative baby boomer just makes the whole output seem less credible.

Likewise for repeating yet more unverified Democrat claims about Russia/US right connections, because, you know, the first twenty times that turned out to be lies somehow wasn't enough. This kind of thing detracts from the other interesting stuff Noah posts.

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Sep 13·edited Sep 13

Kamil Galeev wrote a tweet that likened _Putin_ to a conservative American baby boomer, as dismayed by developments in Ukraine as American baby boomers are with developments on US university campuses.

I guess you could consider the Euromaidan to be analogous to the "Great Awokening" of the 2010s, while the 2018 "March of the New Army" (in which the Ukrainian military effectively positioned itself as a successor to OUN/UPA, for example by adopting the "Slava Ukraini! Heroyam Slava!" call and response) would be perhaps equivalent to the BLM riots of 2020 (or maybe the Palestine protests).

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Noah, I get you want Harris to win. I myself am not opposed but I do not support her. Her autocratic inclinations are different than Trumps but equally disturbing.

I, however, hate your thumb on the scale and omission of facts. Penn Wharton did not add the cost of Harris keeping the Trump tax cuts for people under $400,000. It was not included because it isn’t a formal proposal....Yet. However, it is expected. You should have included that caveat.

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Sep 13·edited Sep 13

As a Harris voter, could you please point by point go through her "autocratic" inclinations? I find this concerning as I've seen no evidence of this from her so far.

Additionally, given that tax hikes are scheduled and have already begun occurring for a majority of Americans under Trump's current tax plan, should we really believe that he will make cuts again if elected? Also, I'm not sure if you're making the point you want to here - tax cuts are the opposite of the austerity that we need.

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Sep 13·edited Sep 13

I’ll give you two. In the other universe where she was running to the left of Bernie Sanders she wanted to eliminate private health care insurance. She also wanted to confiscate guns. Doubtful either would pass constitutional scrutiny. And please don’t come back at me regarding Trump....he is no better.

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Sep 13·edited Sep 13

Ok, so there are dozens of well-run, happy democracies which do not have private health care with only a public option, and have strict regiments on gun control. Obviously Harris has changed her opinion (which should be allowed) on gun control somewhat given her statement at the recent debate, and has a very public position on her plan for health care at kamalaharris.com/issues. It's ok to disagree with these ideas (assuming you have data to back yourself up on the disagreement), but not valid to call those specific ideas "autocratic" when those ideas are demonstrably not autocratic.

Wake me up when Kamala posts all-caps rants about her political enemies on twitter, or when she publicly shouts how she wants to act like a "dictator on day one." Then you'll have my attention!

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Umm, I wonder why the courts keep telling Biden over and over that he can’t do something but he does it anyway. Student Loans as but one of many examples. You can polish a turd but you can’t make it shine. Just because she don’t use all caps and sound like a lunatic doesn’t make her brand autocracy any better.

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Sep 13·edited Sep 13

Executive overreach is certainly an issue, but I would argue mostly reflective of the fact that our legislative branch of government has been held captive by a very large group of "do-nothing" partisans who vote against any bills to improve the border, advance American manufacturing, investing in government-managed infrastructure like roads etc. So the hand of the executive is forced here a little bit, regardless of what you think of on debt cancellation. Personally I'd love if Biden went after colleges with executive action, but that's probably far far too extreme. Would love to legislation on colleges as opposed to executive action of course.

We have a student loan crisis! Noah has a good essay on this here: https://www.noahpinion.blog/p/the-student-debt-revolt-failed-but. I like this comment: "If student debt can’t be cancelled, how about improving it so that it’s terms are not so rigid and - I think - unfair to borrowers. Just make it more like conventional debt. When interest falls, let borrowers refinance. If borrower is overwhelmed, let chapter 11 address the challenge. Etc." Would be great if the partisans in the legislature would consider this.

So, the legislature is held captive by partisans with a vested interest in keeping the government from passing legislation. We have a major debt crisis affecting the livelihood of millions of Americans. Biden got a lot of student cancelled, which is probably the only visible thing he can do to try and address the crisis given the legislature can/will not, but not all of it approved by the courts as you mention. Some (lots as a total $ amount) was allowed to occur.

None of this really gets to the core of your response, which is mostly about false equivocation of student debt cancellation = autocracy. Certainly most economists would disagree with you here, even the ones who vehemently oppose student debt cancellation (which is probably a lot!), and they would be the experts on this sort of thing. I'd also remind you that we're talking about Harris' supposed tendencies toward autocracy, which Biden would not really be a direct example of.

And in closing, I don't think you really want to try and equivocate on what "the courts are telling Presidents to do" when we are discussing Harris v. Trump! It doesn't help your argument here.

I do wonder - would you agree that we have a problem of executive overreach, and support Biden's proposal to curtail the power of the Executive branch?

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You may have missed my point. Biden said I don’t have the authority to extend the moratorium on evictions. He did it anyway. Obama said and did the same thing on DACA. Trump just did the Muslim ban....These are the things autocrats do. SCOTUS has said you can’t just do this...He doesn't care what SCOTUS says. This is what autocrats do when they get reigned in. They just ignore the guardrails. It is a lack of respect of authority. It is telltale.

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Immunity. The issue is moot.

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How 2020 Harris would implement that policy is suspiciously omitted from your analysis of who's more or just as authoritarian as the other. Do you think Harris would go as far as to create fake votes in congress to pass M4A? Or engage in a campaign of disinformation to pressure legislators to switch their votes in favor of M4A? Or perhaps summon an angry mob on the capitol to again pressure legislators and then fail to condemn their violent acts hours after the violence started and after being called to act by her confidants one after the other? Curious that these don't factor in your "analysis".

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Progressives have the same inclinations of autocracy the loony GOP does. It is just they go about things differently. They trash institutions no differently than do Republicans. SCOTUS, the Filibuster, inconvenient things like something not being constitutional, don’t bother them...just go do it. They want to control most aspects of our lives through DC power. It is the inclination that both parties exhibit these days. Neither chooses persuasion or reasoned arguments. Compromise has become a dirty word, depending on whose policies we are talking about. I’m sorry it bothers you that I see autocracy in both our political parties.

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Your first claim was that "Harris was as authoritarian as Trump". Now it's that "there are authoritarian tendencies in both parties". You probably don't realize this but the latter is a weaker claim that I wouldn't contest. Sounds like defending the former/original claim was too much to ask?

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If confiscating guns, eliminating ICE, and getting rid of private insurance doesn’t do it for you, I can’t help you. It would be like Trump saying I’m eliminating Obamacare, I getting rid of the Dept of Education and closing the border. Gee come to think of it.....

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To what extent is the problem of enemy propaganda online the result of a confluence of interests between the totalitarians and the owners of social media platforms?

The totalitarians want to sow chaos and division in the West in order to clear the way to fulfil their own imperialist ambitions, while the social media titans want to sow chaos and division in the West for more pecuniary reasons: anger drives engagement and engagement drives profits.

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"India still has lots of women who don't work outside the home. A lot of these women should be out working in garment factories."

I love these normative assertions that you throw out there like they're conclusions driven by hard data.

Afghani women should have worn miniskirts and owned businesses like we told them too as well. But they didn't.

Maybe culture matters, Noah. And more importantly, maybe Western liberal feminism isn't right for every group of people. Maybe we really are WEIRD. Liberals tend toward universalism (best practices, universal rights, etc...) which can easily veer to utopianism (X is good; therefore we must ensure that everyone does X). The lack of ability to tolerate differences is becoming a hallmark of the modern Left.

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"America is at the point where we need to be thinking about fiscal austerity."

Let us not pretend that either candidate or political party is going to do this. Trump won't because he's a billionaire and pathologically averse to tax increases. Harris won't because she never met a govt program she didn't like and is pathologically averse to spending cuts. Clinton was wrong: the era of big government was just getting started.

Our debt problems will be solved by a catastrophic reversion to mean caused by some black swan event: a strategic defeat re: Taiwan; truly significant civil unrest; a Liz Truss style bond collapse writ large. Our central bank might cushion some of the carnage, but our politicians are going to scratching and biting at the tax revenue feed trough up until the last moment.

"Liberalism is losing the information war"

Be careful here, as it plays right into the hands of the Right. The Right already doesn't trust the media, and not without legitimate cause. The press has always been left-wing, but they've gone unhinged since 2016. Thus, any attempt by liberals to use govt to suppress "right-wing misinformation" will likely backfire. Right-wing postliberals (I won't say conservatives, since the old-school conservatives are transitioning to becoming Dems) simply don't trust libs any more than libs trust them.

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Thanks for adding the good news at the end. There's such an inherent negativity bias in journalism, and especially in algorithmic virality, that we need to consciously work against it. You often talk about the unrest of the 2010s, I think a lot of that stemmed from the rise of social media and a "negativity shock" that created that we're only slowly adapting to by disengaging (and recognizing that *the sky is always falling* online).

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Xi's focus on manufacturing brings to mind the great book by Ulrike Schaede, The Business Reinvention of Japan: How to Make Sense of the New Japan and Why it Matters (2020), in which she describes how in the last few decades, Japan has leapt way ahead of us in the application of the newest technologies to advanced manufacturing, allowing it to become a global leader of critical product components in one industry after another. You've written about industrial policy before, but this is something bigger. See Adler and Bonvillian, America's Advanced Manufacturing Problem - How to Fix it (American Affairs, Fall 2023). We should study what Japan has been doing ... and immediately begin to change the set of incentives that govern how our businessmen decide when, where and how to make capital investments.

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Best-case scenario deficit-wise is a Democrat president and Republican Congress. That's looking fairly likely.

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Texas is a big place, and it has a couple big advantages leftover from its boom-and-bust “non-clean” energy past. Their is existing infrastructure that can be leveraged, and there is an existing workforce of people who know how to identify projects, build them, deal with land and regulatory related issues, and operate them effectively. We’d be further along if we had been partnering with the energy industry to accelerate the transition to clean energy rather than fighting with them over fracking and pipelines while we waited for the technology to advance and the projects to become economically viable. Energy is energy. Insisting we needed to create a whole new industry turned into a time-consuming money grab.

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*there

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I think if there's a future in degrowth for sustainability, it would be studies of meso-economic pruning where government puts the brakes on some kinds of growth as it might in wartime mobilisation. We can't spare you any ai researchers, ace programmers, excellent researchers -- sorry porn industry, sorry scam call providers, sorry sports betting web sites, sorry creators of JavaScript frameworks etc.

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"creators of JavaScript frameworks" gave me a good chuckle

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Excellent l

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There was record new-business formation triggered by the Covid-19 pandemic. If half of those businesses survive, what a plus for the economy in the remainder of the decade. I think too much attention is focused on stock market indexes, while small private businesses have boomed. Basically, a lot of resilient Americans who lost their jobs during the pandemic made lemonade out of an unexpected load of lemons. That speaks volumes about an adaptive, creative economy. It’s Darwinian: Survival of the most adaptable, not the strongest. Civil war. Cripes, most Americans are too busy working. The complaint I heard when traveling throughout the country is: “Nobody wants to work.” Actually, people who wanted a decent job and a living wage were already employed.

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The irony in re Xi’s crackdown on the tech sector is that foreign direct investment all but dried up. And where is a lot of it going? Into Southeast Asian countries, funding the scale-up of an economic and tech moat surrounding China. His lust for and/or insecurity in re control is a benefit for Southeast Asia and the West.

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“One interesting new tidbit here is that biotech seems to be getting neglected too, which is consistent with Xi’s seeming disinterest in giving China a better health care system.”

Here’s disinformation in reverse: Xi and Putin are the two worst leaders of major countries. They both lust for power and control and can’t manage their egos, let alone their countries’ economies. Xi idea of a health plan for Covid-19 was a lockdown of cities. Whoops. His crushing the high-tech sectors was a function of his insecurity about power. Putin had another method. He invaded Ukraine and most of the educated, young tech talent fled to the west. Unlike in China, they were employed. Two million Russians fled to Poland. Ironically, according to mainstream media, Putin’s next target after Ukraine is Poland. Xi’s plan for +20% unemployment if young, educated Chinese: “Eat dirt.” In other words, return to the countryside to live with your parents. Iraq is every bit as bad: the economy is suppressed with sanctions from the outside world that the young, educated Iraqis live with their parents, delay marriage, and formation of families.

The notion that China is going green is false. It’s building more new coal-energy plants at a rapid pace, burning Chinese coal, the softest, dirtiest coal. China is losing hydroelectric power generation as major river flows are suffering from extended droughts — something also happening in the U.S.

All of this is ammunition for the West to fight the Information War.

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I believe that liberalism on the left-center is losing to totalitarianism because apply little to no pressure to those further left who embrace it. Traditional liberals need a Buckley to purge the anti-democratic elements .

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