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Notes -
Minor update on the US-PRC tech competition.
Culture war significance: it matters for the grand strategy understanding and the narrative of the US as the Main Character of History. Personally, I had stopped regularly engaging on this forum when it became clear that the US is, in fact, not such a Main Character (at least for the moment), but just a great power with massive momentum and cultural influence. Not being American, I mainly only care about American cultural affairs insofar as they have global spillover effects. Local legislation news and woke-MAGA strife are overwhelmingly noise for the world, unless they reach some critical volume like peak woke or BLM did. Some American tech, and related politics, is very much not noise. The chip war in particular is very high-signal, so I follow it closely.
It seems something happened behind the scenes after those events in October, when the US Department of Commerce went with the Affiliate Rule, China retaliated with REE+ export controls, and soon enough, by November 1, we've got the usual Trump style Deal. (There's also a subplot with Nexperia/Wingtech, that demonstrates Chinese supply chain power and European ineptitude again, with a similar outcome of the Western actor retreating). Suddenly, on Dec 8, we get the news about Trump permitting the sales of H200 to China (context and understandable rationalist perspective here). China reacts somewhat paradoxically, if your theory of their mind is just «they're desperate for our chips» – as per the FT, «Companies seeking to purchase the H200 would need to submit a request explaining why they cannot use domestically produced chips and undergo an approval process», in continuation of their earlier scrutiny, rejections and negative publicity directed at H20s.
10 days later Reuters breaks the news – which were not quite news for those in the know – about Chinese successes with their EUV effort. The article is somewhat confused, as almost all reporting on Chinese AI and IC tech is; from my private sources, the situation has already moved further on multiple components, like optics and metrology.
What I want to emphasize here is that it's not just trivial «industrial espionage» or IP theft. Their light source project is led by former ASML head of light source technology and «Light source competence owner for metrology in ASML research» Lin Nan. I think that he returned not just for money, nationalism or career opportunities, but because China offered him a more ambitious challenge – he seems interested in solid state lasers, which ASML, constrained by market incentives more than strategic considerations, gave up on. For sure, straightforward IP theft also happens - CXMT's DRAM/HBM progress is apparently propped up by Samsung IP which was, well, illicitly transfered by former employees. And there's very substantial domestic talent pipeline, though people are prone to dismiss their patent/paper counts; they lack brand power, «Changchun Institute of Optics» doesn't have the same zing to it as Zeiss, though you may see it in the news soon.
All in all, China is moving far faster than even I imagined. Now we get reports – straining my credulity, to be honest – that ByteDance doesn't expect Nvidia to sell move than a few hundred thousand cards in China, not because of any trade barriers from either side, but because adequate domestic competition will come online in mid-2026 already. Almost certainly it'll be worse and less power-efficient, at least. But clusters with Chinese hardware are eligible for electricity subsidies, and that may be enough to tip the scales? This logic is corroborated by the surprisingly low leaked price of H200s – just $200.000 for an 8-card module (not sure if that's before of after 25% Trump Tax, but in any case very low, maybe lower than in the US proper, at least pre-tax). Meanwhile that's 5 times more bang for the buck than H20s offered. On the other hand, for now Nvidia is selling old stock; new production is being discussed, but at this rate I don't expect the price to increase. One can reasonably ask if this makes any sense, given that the demand in the US outstrips supply. I think it does, both for complex strategic reasons (mainly ecosystem lock-in, which is in fact a big deal, as I explain here) and simply because the US AI market is becoming a very convoluted circular Ponzi scheme where Nvidia de facto subsidizes companies to buy Nvidia wares. That's more of a potential market meltdown recipe than a revenue source. H200 sales to China, for what it's worth, unambiguously pull in dollars, and both Jensen's fudiciary duty and Trump's deficit-slashing mandate (and to be blunt, likely Trump's corruption) create a strong incentive to greenlight them.
Anyway, what looked like Chinese bluffing and negging at the time the sale of H20s was debated looks more and more like genuine, coherent industrial policy. China is pretty sure it'll have sovereignty in the entire stack of AI development, soon enough, that it will even be capable enough to export its AI hardware products, and the US is acting as if that is likely true – as if the competition is about market share and revenue. They are obviously compute-constrained right now, so DeepSeek V3.2 only catches up to around GPT-5 level, with the usual complaints in the paper. They don't appear to mind this enough to bow and scrape for more American chips at any cost. A large component here is that what they need, they can often rent overseas openly –
– but I think it's primarily about confidence in the domestic supply chain.
Long before all these events, in September, we had a debate with @aquota here, when the topic was selling China relatively worthless H20s. (For my previous take on H20s specifically see here).
He argued:
To which I've replied:
It seems to me that my read on the situation from back then, both the big picture and its implications for compute strategy, is now shared by both the USG and the CPC. The former is trying to regain its position and revenue in the Chinese GPU market and slow down Huawei/Cambricon/Kunlun/etc. ecosystem development by flooding the zone with mature Nvidia chips that will be adopted by all frontier players (eg DeepSeek again – they have a deep bench of Nvidia-specific talent and aren't willing to switch to half-baked Ascend CANN). The latter is more worried about preventing the US from doing that than about gaining moar FLOPS in the short run.
In conclusion, I want to congratulate Americans again with having found a true peer, for the first time since the decline of the British empire. Germans, Japanese and my own people had failed to provide enough stimulation, so Americans have grown lonely and fat at the top.
Aquota said:
I do not, in fact, "understand" this. Like, that may be the case and we'll just have Pax Sinica. I'm okay with it but I'm not Sinophilic enough to expect it. Even reduced to "just a great power", the US is poised to remain a historical force.
For now the loss of the indisputable Main Character status is being processed traumatically, with anger, denial and exaggeration of the costs of that loss if it were to really happen. But as its reality sinks in, this trauma may become fertile grounds for some cultural Renaissance in the United States. Less capeshit, more self-awareness. I may even come to care about it for reasons aside from global consequences.
…Of course, we can still entertain the hypothesis that all of the above is some interesting ephemera and this final dash of the Chosen Nation towards AGI-powered Rapture and completion of history is the real story of the times. I won't completely discount it, we shall see.
IMO, this is still the operating assumption of the AI race. It is also the only thing which justifies the intensity of the efforts expended by various AI companies.
Normally, when a new field of tech is breached, there is no decisive first-mover advantage, where a technological lead of a year will translate into long-term dominance. History is full of cases (e.g. early home computers (e.g. Apple Macintosh), dot-com boom (e.g. myspace), photovoltaic (e.g. German companies), browser wars) where the forerunners became footnotes in history.
But what OpenAI investors buy is not so much future profits if OpenAI replaces most of the work force, but an investment-proportional solid angle of the light cone if Altman achieves aligned superintelligence (and remains aligned to his investors himself). The presumption is clearly that whoever finishes climbing the rope first will then cut the rope to prevent anyone else from following.
Many OpenAI investors don't believe in the singularity. Microsoft is demanding revenue-share from OpenAI right now. They see the power of the technology and naturally decide to invest in it, even if they're unpersuaded on mass automation or singularity. They want it to sell more subscriptions, speed up software development. It's the myopic facebook mindset of 'this technology could sell us so many short-form video ads' and tbf, that is true. AI is making huge amounts of profit for Facebook right now. Tiktok makes enormous amounts of money (in China) based off its algorithms which include LLM tech. AI is highly profitable right now and it is a sure bet that there will be further highly profitable offshoots from LLM technology, besides the singularity. They just require lots of investment to tap and we are still in an early-growth phase of a new market, whereas video is a lot more mature.
Older versions of Claude Sonnet could easily snipe redditors per the /r/changemyview experiments, obviously AI can make huge amounts of money for businesses.
OpenAI is valued at a mere $500-830 billion. The market cap of gold and silver is about $35 trillion. If OpenAI valuations were genuinely driven by belief in the singularity, it'd be worth a lot more than shiny rocks! The lightcone contains a hell of a lot of gold, a company with singularity-pilled investors would get everything money can buy even if they are just one of a few leading competitors.
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This thread got so sidetracked by arguments about GDA and "America #1" but this
Is one of the biggest (arguably, the biggest) stories of 2025. The whole story of the West vs China is that we dominate in cutting edge tech, and they might manufacture a lot, but our qualitative advantage sustains our dominance. EUV (and mono-crystal jet turbines) are the poster children techs for "China may have an order of magnitude more industrial output, but they don't have our X!"
Now that paradigm is falling apart, it's scary.
Admittedly I am only skimming on what Asianometry presented on Youtube about Asian tech but his assessment is that big names mean very little in the EUV space. Lithography and chip fabbing are incredibly complex industries that are beyond the ability of a singular genius to sway. You need a team of geniuses in a vertically integrated industry with solid government backing and private investment to get anywhere.
Even China can't outbid the entire world for RAM and CUDA cores. Selling to themselves in a closed market forgoes a lot of profit on the international market and will only make prices go even higher. A lot of capital is being sunk into this next frontier of Great Power competition and the West has a great deal of control of the technologies that make it possible.
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I have to confess that I do not have much trust in Chinese media accurately reporting on this matter, nor do I trust Reuters - what/how would they actually know? What other evidence is there, even if only circumstantial, that would suggest there has been real progress toward developing domestic EUV capability in China?
R&D in different sectors can be extremely different, but at least in the sectors I’m familiar with, I’m not very impressed by the current academic and research culture in China. It is certainly better than in 2015, as more and more people trained in the US, Germany, or elsewhere have returned to China, and creating some shift within academia and shifting from publishing papers in shitty predatory journals to producing higher quality research and technological development at least in Peking, Tsinghua etc that can rival the “west”. But considering how the broader academic culture continues to treat people like candles, burning them up and then tossing them in the trash, I don’t think this creates a good culture or working environment for many of the most ambitious and talented researchers. Maybe I’m wrong and corrupted by the west and turned into a soft-hearted baizuo already, and with enough talent China can afford to waste precious human capital like this (e.g. this or this (Chinese) or this (Chinese)), but I’m not terribly convinced.
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Sputnik was a big story, Soviet technical competence was not. It will be a big story when we see deliveries of machines, first wafers, first chips. I allow that I may be wrong and trust the wrong sources. 2028 for first risk production seems plausible right now. Hopefully it will be resolved one way or another.
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I don’t have the knowledge or experience to refute much of this but do that consider China has not found some new, incredible system of economics. They’re massively tilting their economy and investment towards things like this to the detriment of their consumers and other sectors of the economy. It is an inefficient economy that needs strong reforms that will likely never happen. The main character argument seems like some self fulfilling prophecy you believe in. Whatever happens, I’d probably rather be in the shoes of the US than China in the next 50 years.
I don’t underestimate their ability to innovate but I don’t believe in their ability to produce strong thinkers and leaders that come from out of nowhere. There’s some appropriate panic about their progress in many areas, but I just don’t believe in ‘capitalism with socialist Chinese characteristics’. The idea that they will just steamroll the world is far fetched imo.
You say this like the US isn't massively tilting their economy in even worse and more unsustainable directions. The US has been privileging financial fraud, outsourcing, private equity vulture capitalism and a whole host of other social ills. The USA would unironically be better off if they directed all the investment currently being placed into gambling, sports betting and outsourcing into high tech manufacturing and research.
Come on this is farcical and focuses on an absolutely tiny part of the US economy. Sports betting is annoying and predatory but it was happening off shore until recently. There are always going to be money grubbing industries in good times. The pump and dump stuff in crypto is probably a more reasonable thing to think would have downstream effects.
The main thing is the US is a consumer and services dominated economy, which is what happens when an advanced economy is capable of circulating money back to households to sustain demand. China is depressing this part of their economy and has huge overcapacity as a result. More than that, they’re so focused on production that other countries are frustrated that they do not import goods and services. As people are saying in this thread, the US is the biggest consumer market in the world.
They have a ton of EV companies, of which like 5 will make it to 2030. This strategy of focused investment might look good for industry but it is not good for the ‘quality growth’ they apparently are after. I do not believe this is a sustainable strategy and does not position them well to rival the US.
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Yeah. Atleast China curates things on plausible social utility
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And precisely this mindset's why the US, yea West is decaying - instead of infinite striving for excellence, those raised here sit on past laurels and cope away anything better. Living without curiosity is comfortable lest you learn something new and convert everything around you into tech debt to work on - yet that comfort's disappeared, hence our entire community, formed around discussions of cost disease and cultural decline.
More glib, is America, are Americans really just better because of superior protestant-frontier culture - even though they lost their mandate and lack children to be replaced? What distinguishes Chinese in America from those in the PRC, home grown communists from foreign infiltrators, pedophiles from the heartland like Hastert and Foley from Afghan bachah-lovers and Pakistani groomers? REV Group closed factories and quintupled prices so an (inferior!) American firetruck costs a magnitude more than Chinese or even German vehicles, which our communities must pay for, our world is on fire, and you say nothing's wrong.
I don't understand your point here.
You're complaining about Americans being glib but your comment is one of the worst offenders I've seen in a while.
I think his point is that many Americans are watching China build an extremely impressive society almost from nothing and searching for excuses to explain Chinese achievement away rather than deciding they could learn a thing or two.
(It’s not ‘real’ growth, Chinese can only imitate, what about the consumer sector, etc.)
It is conceivable (though not certain) that the achievements of the West are not a reflection of a better philosophy or system of government but merely a temporary reflection of weakness in our competitors plus luck for us (finding a new continent, the renaissance, etc.). If so, if so, it would behoove us to get our act together and drop our certainty in our own systems ASAP.
It is also conceivable, and indeed quite certain, that civilizations can rise and decline, and this is only partially about essential qualities of the people, because genetics doesn't in fact explain 100% of the outcomes. That culture itself can rot. The West, I think, is genuinely an exceptional civilization, with very strong fundamentals. So was China, at one point of time. But China declined through unforced errors. So can the West. It's important to internalize just how advanced they were, and how far they have fallen.
From The Rise and Fall of the Great Powers:
Of all the civilizations of premodern times, none appeared more advanced, none felt more superior, than that of China. Its considerable population, 100-130 million compared with Europe's 50-55 million in the fifteenth century; its remarkable culture; its exceedingly fertile and irrigated plains, linked by a splendid canal system since the eleventh century; and its unified, hierarchic administration run by a well-educated Confucian bureaucracy had given a coherence and sophistication to Chinese society which was the envy of foreign visitors. True, that civilization had been subjected to severe disruption from the Mongol hordes, and to domination after the invasions of Kublai Khan. But China had a habit of changing its conquerors much more than it was changed by them, and when the Ming dynasty emerged in 1368 to reunite the empire and finally defeat the Mongols, much of the old order and learning remained.
To readers brought up to respect "western" science, the most striking feature of Chinese civilization must be its technological precocity. Huge libraries existed from early on. Printing by movable type had already appeared in eleventh-century China, and soon large numbers of books were in existence. Trade and industry, stimulated by the canal-building and population pressures, were equally sophisticated. Chinese cities were much larger than their equivalents in medieval Europe, and Chinese trade routes as extensive. Paper money had earlier expedited the flow of commerce and the growth of markets. By the later decades of the eleventh century there existed an enormous iron industry in north China, producing around 125,000 tons per annum, chiefly for military and governmental use—the army of over a million men was, for example, an enormous market for iron goods. It is worth remarking that this production figure was far larger than the British iron output in the early stages of the Industrial Revolution, seven centuries later! The Chinese were also probably the first to invent true gunpowder; and cannons were used by the Ming to overthrow their Mongol rulers in the late fourteenth century.
[…]
But the Chinese expedition of 1433 was the last of the line, and three years later an imperial edict banned the construction of seagoing ships; later still, a specific order forbade the existence of ships with more than two masts. Naval personnel would henceforth be employed on smaller vessels on the Grand Canal. Cheng Ho's great warships were laid up and rotted away. Despite all the opportunities which beckoned overseas, China had decided to turn its back on the world.
[…] Apart from the costs and other disincentives involved, therefore, a key element in China's retreat was the sheer conservatism of the Confucian bureaucracy—a conservatism heightened in the Ming period by resentment at the changes earlier forced upon them by the Mongols. In this "Restoration" atmosphere, the all-important officialdom was concerned to preserve and recapture the past, not to create a brighter future based upon overseas expansion and commerce. According to the Confucian code, warfare itself was a deplorable activity and armed forces were made necessary only by the fear of barbarian attacks or internal revolts. The mandarins' dislike of the army (and the navy) was accompanied by a suspicion of the trader. The accumulation of private capital, the practice of buying cheap and selling dear, the ostentation of the nouveau riche merchant, all offended the elite, scholarly bureaucrats—almost as much as they aroused the resentments of the toiling masses. While not wishing to bring the entire market economy to a halt, the mandarins often intervened against individual merchants by confiscating their property or banning their business. Foreign trade by Chinese subjects must have seemed even more dubious to mandarin eyes, simply because it was less under their control.
…
This dislike of commerce and private capital does not conflict with the enormous technological achievements mentioned above. The Ming rebuilding of the Great Wall of China and the development of the canal system, the ironworks, and the imperial navy were for state purposes, because the bureaucracy had advised the emperor that they were necessary. But just as these enterprises could be started, so also could they be neglected. The canals were permitted to decay, the army was periodically starved of new equipment, the astronomical clocks (built c. 1090) were disregarded, the ironworks gradually fell into desuetude.
These were not the only disincentives to economic growth. Printing was restricted to scholarly works and not employed for the widespread dissemination of practical knowledge, much less for social criticism. The use of paper currency was discontinued. Chinese cities were never allowed the autonomy of those in the West; there were no Chinese burghers, with all that that term implied; when the location of the emperor's court was altered, the capital city had to move as well. Yet without official encouragement, merchants and other entrepreneurs could not thrive; and even those who did acquire wealth tended to spend it on land and education, rather than investing in protoindustrial development. Similarly, the banning of overseas trade and fishing took away another potential stimulus to sustained economic expansion; such foreign trade as did occur with the Portuguese and Dutch in the following centuries was in luxury goods and (although there were doubtless many evasions) controlled by officials.
In consequence, Ming China was a much less vigorous and enterprising land than it had been under the Sung dynasty four centuries earlier. There were improved agricultural techniques in the Ming period, to be sure, but after a while even this more intensive farming and the use of marginal lands found it harder to keep pace with the burgeoning population; and the latter was only to be checked by those Malthusian instruments of plague, floods, and war, all of which were very difficult to handle. Even the replacement of the Mings by the more vigorous Manchus after 1644 could not halt the steady relative decline.
One final detail can summarize this tale. In 1736—just as Abraham Darby's ironworks at Coalbrookdale were beginning to boom—the blast furnaces and coke ovens of Honan and Hopei were abandoned entirely. They had been great before the Conqueror had landed at Hastings. Now they would not resume production until the twentieth century.
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Is anyone saying China isn't in some of ways impressive? But except for maybe industrial might it's still no comparison. For example, many Chinese people joke that the Chinese dream is "becoming American". It's an unpleasant place to live for all but a few. Much like the Soviets it's a poor totalitarian dictatorship forcing money into key sectors at an unsustainable rate to keep pace with America. I'm not implying it will totally collapse like the Soviets by the way, but acting like a country with a $13k GDP per capita is a true peer to America in most ways is on its face pretty tough to swallow.
I have only ever visited China once but most of the people I spoke to (and the Chinese I have known outside China) were very proud of their country and not very interested in America.
This is the point being made above about glibness. China is rapidly developing industrial might, while America (plus Europe) looks an awful lot like a sclerotic mess with incredibly high costs, propped up by finance and an AI bubble. And faced with this, Americans claim that ‘actually, the Chinese want to be like us really’ and ‘Chinese growth is all an illusion so it’s not worth worrying about’*. Americans seem right now to be incapable of genuinely entertaining the proposition that the American way of doing things isn’t the only way or the best way.
*The latter claim may be true. Genuinely unsure.
Whereas one might as easily point out that huge amounts of Western economic activity are either self-sabotaging (wasting vast amounts of treasure and brainpower on finely-balanced legal questions, financialisation of the real economy) or fripperies and super stimuli (witness China heavily restricting video games).
Ultimately people didn’t want to be American or like Americans because of America’s culture and system of government, but because America was rich and powerful and they wanted to be rich and powerful too. Even for Americans themselves this is the case, I think: how many Americans would happily live in a third-world shithole economy as long as it was run faithfully in accordance with the American Constitution and Amendments? 10%? If America loses industrial might, they will lose a lot of other things in quick succession.
This is the same mistake we British made, incidentally: that the rest of the world looked up to us and came to be educated by us and copied our parliament because they liked us and respected our way of life. No. They respected Empire and when the Empire died so too did the respect.
I have spent a lot of time in China and more time with chinese expats in Asia and America. There is a subset of people who are absurdly pro-CCP, mostly party insiders and a subset of highly educated/succesful ultra-nationalists. These are the only people you will probably meet if you don't speak Chinese or another Asian language. Young people at large are very unhappy with the current state of corruption, know the wages there are awful, and furthermore know the youth unemployment rate is awful and rising. Of course, my sample set (so to speak) will be biased, (particularly the expat community in asia) but it's not a secret that the Chinese youth are being screwed over by the CCP intentionally depressing wages and an additional issue of huge unemployment. There is no more "the future looks brighter than yesterday" feeling in China now. Quite the opposite.
And when I say "The Chinese dream is to become American." I say it because it is actually a phrase thrown around many circles in (at least South) China. I didn't create it myself.
This seems like a huge strawman to me. Americans aren't capable of ciriticizing themselves? Really? I mean, go just about anywhere and all Americans do is complain about America to the point of parody. Hell, if you want me to give you a list of my complaints about America I will gladly list them here, but they just won't be that America is poor with a government funneling people's money into a tech race that it's not fit to compete in. You have some fair points about the sclerotic bureacracy, but undoubtedly it's much more complicated than the popular meme of "China just gets things done and America/the West doesn't".
I would say 150+ years of mass immigration before American total hegemonic power suggests that people wanted to be Americans long before America was the all powerful hegemon it is now. However, I will admit a lot of that shine has worn off since America has become more and more like a European bureacracy laden all encompassing state. America is not as much the land of the free as it was, even if it's doing better than any other developed country I can think of.
EDIT: Let's also note that right now China is very poweful and nobody wants to become Chinese. Even me, somone who has an obsession with Asian culture and languages, who finds Chinese history very interesting, and loves parts of its (former) civilization would admit this.
But there is also a truth that people want to emulate winners, not losers. Britain and Europe at large are on large losing streaks to say the least.
Sure, people don't really care about "power" - but wealth? Already from the mid 17th century, America was more or less the wealthiest place in the world per capita and really broke away from Europe in the 18th century.
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Modern Chinese are becoming less materialist, less pro-democracy and more nationalist, even as life satisfaction falls, so I really don't think they're attributing their woes to the CCP.
Isn't this pretty much an obvious conspiracy theory? They simply don't have enough high-paying white collar jobs for an enormous surge in overqualified university graduates. Why the hell wouldn't wages be stagnant if supply outstrips demand.
I think that's proving his point. Like, this kind of framing strikes me as deserving of very harsh criticism, it's basically barbaric gibberish. But it's part of your culture, your "civilization", such as there is.
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All points taken.
FWIW what I’m basing my ‘Chinese’ reports on is:
a) various conversations with (mostly older) people in train stations etc. Maybe I am the victim of a sophisticated propaganda barrage designed to subvert visiting foreigners but if it can successfully hire/imitate retired professors of geology then it’s a very good program. I didn’t speak to younger people.
b) My Chinese co-workers in Japan. One of whom is a very good friend and left China to escape his overbearing extended family not Xi. He is mildly pro-China rather than anti-China or pro-America, but not to any silly extent.
Of course Americans are capable of criticising themselves. But in the main they seem to criticise themselves for not being American enough. For failing to live up to the American ideal, undermining American freedoms/rights, too much or too little immigration according to taste. Very few people apart from the largely-defunct pro-European movement are saying that maybe the American way of doing things is at best one system among many. Or for example things like, “maybe balance-of-power democracy and a system of rights defended by law is less effective than a single party run by engineers and a tightly controlled industrial policy” or “maybe basing our national mythology on having a revolution to avoid paying taxes and submitting to central authority encourages fractiousness and sectarianism”.
EDIT:
You do have to bear in mind who these people were, though. Overwhelmingly Irish, Italian, German and Jewish, with some Chinese. All people who had pretty good reasons (poverty or persecution or not wanting to live with the Prussians) for leaving their current country. I am sure they liked the idea of freedom but I think that the push factors were more pressing. And indeed Britain also got many of these people.
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Without doxxing yourself, can you tell us when and where you were in China/East Asia? I feel this is one of the most important pieces of information when discussing the country. China in 2025, 2015, and 2005 are completely different places, and people’s views on the current state of the country, the outside world, and their own upward mobility differ dramatically. Without that context I find the discussion largely moot. I probably fit your description of the “well-educated, ultranationalist Chinese you find outside China”, although I’d describe myself as overeducated and only mildly nationalist. My social circle is obviously not representative of China as a whole, but at least within this overeducated slice of society, opinions about the Chinese state and future life prospects have changed substantially over the past two decades. During my childhood, among adults (and by osmosis among kids), there was a pervasive sense of dissatisfaction especially around corruption. As a kid, I remember adults constantly talking about “塞钱” (stuffing money) into police officers pockets to change a child’s name, birthday, etc. Corruption was absolutely rampant then. Ten years later to around 2015, when I was in university, tthe general sentiment at least in big cities had shifted a lot. There was a sense that the wind had changed, and unless you were very rich or very well connected, you couldn’t and shouldn’t expect things to work the old way. Gifting doctors money probably will get you a bed by the window but wouldn’t get you better treatment, police wouldn’t take bribes to change your kid’s name. Of course this wasn’t uniform across the country, corruption remained more prevalent in smaller cities, but the change was real. Other things like copy right also changed quite a bit. Gone were the days where I can find pirated movies on bilibili with a simple search, and now you’d need many layers of get-around to find those movies, although those are still out there if you try harder.
Another ten years later, here we are in 2025. The corruption issue is certainly not among the top things on people’s minds, which is why I think your information is at least 10 years out of date, especially the claim that “young people are very unhappy with the current state of corruption”. Young people simply have not experienced the level of corruption that will make them very unhappy with the current state of corruption. Xi's anti-corruption campaign created a shit ton of extra bureaucratic nonsense like asking dance club of elderly to fill fifty forms and only spend 20 rmb per person on their Chinese New Year gift purchase or what not, but by no means ineffectual. I think the top concerns on the average Chinese person’s mind today are wages, housing (which I actually think is a critical failure point of the country. housing price where I grow up increased 50 folds in 20 years), healthcare, and marriage/childcare. Corruption in China today is much more like corruption in the U.S. than in Nigeria: subtler, not a dominant factor in everyday life, but one that occasionally erupts into major scandals. I do agree that most young people think wages are bad and unemployment is bad, in a way not unlike the vibecession discussion in the US. But to be blunt it’s simply regarded to say that Chinese people by and large have not benefitted tremendously from the economic development, or better off than they were ten years ago. Claims that only a tiny fraction of people benefited from China’s meteoric rise, that only the “highly educated, successful ultranationalists”, or 富二代 who drives aston martin in Vancouver and driving up rent, or the red princelings, got their share, while everyone else was left behind, strike me as peak delusion if said by some Chinese youth and peak cope if from an American, NYT columnist or themotte frequenter. It’s just undeniable that a vast majority of Chinese people benefited materially from the CCP’s economic policies over the past two decades. Maybe one consider that to be only small achievement, but I disagree strongly. Or maybe we can do the usual “but at what cost” thing and I’ll even agree largely, but I don’t think that’s what you said.
As for “the Chinese want to be like Americans”, you’re not entirely wrong but you are still very mistaken. Again, there’s a clear progression in sentiment. Twenty years ago on Baidu Tieba, then the largest Chinese discussion forum, people requesting porn would often append “下辈子美利坚”, or “next life, America”, a pun implying a wish to be reincarnated in the US with a pun (坚means hard, as in harder penis) for a harder “weapon”. That kind of open and widespread worship of the U.S. (and, by extension, of whiteness. people even slapped “Made in Czechia” labels onto low quality chinesium as a supposed mark of superior quality) is nowhere near as common today. Those same people, I suspect, either turned into 反贼 (traitors, as pro-CCP pinkies 粉红 call them) or transitioned into 粉红 themselves. As a line from a Chinese movie goes, “they follow whoever wins”, and China has been doing a lot of “winning” lately, certainly less than those “winnologists” (赢学家, Chinese nationalists who crave winning) believe but more than enough for the mildly nationalists online to be 10x as vocal as they were before. Are people more pessimistic about their own future than a few years ago? Maybe, especially after the catastrophic handling of covid. But have they reverted to wishing everyone could be reincarnated as Americans? No. That era is gone. Maybe that’s a low bar, but a change is still a change.
It does pain me that many of my fellow countryman want to turn their cities into LED hellscapes, which in many minds signal “development”, a cargo-cult worship of I guess the American or their imaginary West with Chinese characteristics. Still, as many below have pointed out, the Chinese want to be like Americans not because your Americaness, but because you’re rich and powerful. To Americans, this distinction may seem unimportant, since being American is already synonymous with being rich and powerful. But I think it is not synonymous for most Chinese and when American economical gild fades you will see the distinction.
I’ve lurked on here for many years. My own social circle is a giant blue bubble, and this is one of the few places where I can read from a grayish-red slice of Americans who are thoughtful and articulate. Over time I’ve sensed a growing belief there that something is rotten in the US. Whatever their prescriptions for social illness, there’s a pervasive pessimism. Difficulty celebrating small wins (see the thread down below “small hiccups among decades of winning” re the OU placing the trans TA on admin leave); tech pessimism (more among general well-educated blue tribers, not here); cynicism toward government everywhere, but especially at home. Yet despite all this, most Americans on that forum still seem to believe that America, whatever she represents, is fundamentally great. They criticize her, but they also believe in her. I’d argue the Chinese are similar.
Why is it so hard to understand that, just as Americans can criticize America while loving and caring about it, the Chinese can do the same? Why assume that when they criticize the government for mishandling of covid, or flip-flop between one-child policy and infinite child policy, or letting real estate being a major source of local government income and get them hopelessly addicted to it, they are not simply voicing their concerns similar to red-blooded Americans, or like performative blue tribers ranting about silly shit, but are actually losing hope in CCP’s mandate of heaven and yearn for liberty and democracy? Why is it unthinkable that Chinese people, nationalist or not, mean what they say, not because they’re misled by the CCP, but because they’ve actually experienced the benefits of their country’s rise? Why default to cynicism when a much more straightforward explanation is available? I suspect the answer says more about Americans than it does about the Chinese.
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If I understand @DaseindustriesLtd correctly, he's not saying that China will steamroll the world, he's saying that the US will lose its position of clear dominance.
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Thats what gets me. The dream for some Chinese seems to be for their children to leave China, how many of them want their child to go to Harvard? And some of the Chinese here in America have relatives sending them money to invest in oppurtunities not available to those living in China.
My impression is that in recent years the relative status of top American and Chinese universities has flipped in elite Chinese circles, such that someone who went to Harvard is seen as a slacker who ran away because they didn't do well enough on the Gaokao to make it to Tsinghua.
I think that’s mostly cope from people who can’t get into Tsinghua or Harvard. I think people do rightfully see things like "Columbia master’s students in biostatistics" or overseas student from anywhere else that's not Ivy as slackers since many of those degrees are essentially bought, but that criticism doesn’t really extend to most other Ivy programs. Among well-educated people, these schools are seen as more or less equivalent, though choosing Tsinghua versus Harvard does signal your political preferences to some extent.
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There are a lot of Chinese. A tiny fraction of them could be dreaming of leaving (smaller than the "move to Canada"/"move to Russia" faction of Americans?) and there would still be enough that it would feel like a huge phenomenon in the target country.
(Also, how up-to-date is the perception that it is common?)
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It doesn't come out of nowhere, it's called education, competition and meritocracy, and they clearly have strong leaders and thinkers already. You're just in a bubble.
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Does it even matter who wins this industrial competition? It might as well be a football game between foreign nations to me, and you. I just want to be, a swiss. To live comfortably without an overlord. If pikes no longer suffice, nukes.
When the japanese and south koreans copied and then bested american cars and german optics and swiss watches, did the americans and germans and swiss subsequently sink into poverty? No, they just got richer. It has never been a zero-sum game. Believers in zero-sum games end up playing negative-sum games.
I see your point, but it occurs to me that it's at least theoretically possible for a nation (or some other group) to end up in a situation where they don't produce anything that anyone else wants. And in fact there are nations (and groups) with these characteristics, and they tend to be very poor and also reliant on handouts.
Germany, Switzerland, and the United States still produce a lot of goods and services that people will trade for.
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I don't know what the Swiss thought of it, but Americans absolutely had a psychotic meltdown about Japanese competition. I think you don't get how intoxicating the sense of supremacy is. Switzerland is just a nation, its manufactures are just manufactures, it operates on the logic of comparative advantage. Americans have an ideological stake in being Number One.
Americans really need to brought down a peg in their delusions of self grandeur to the same level as the rest of humanity. Yes they'll wail and whine and throw tantrums about being seen as the same as rest of us but we have a duty to not humour them, after all, as they say: when you're used to privilege, equality feels like oppression.
The top level post below yours is uncritically discussing the following proposition: "is our culture good because it is American, or is it American because it is good". From the perspective of someone in Europe the complete non-consideration of the possibility that "American culture" may, in fact, not be good is galling. It's as if the possibility doesn't even register in these people's minds.
It's always satisfying to see the mighty brought low and while I have no particular love for China when the inevitable inevitably happens I'll bring out my deckchair and grab a bag of popcorn so I can watch and make snide quips from the sidelines.
Why do you post here? This is basically just snide at people you hate despite your alleged life being provided by that people.
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This kind of attitude probably carried more weight back when anyone still thought Europe had a future.
You'll take a break from posting apologia about how your current country doesn't arrest THAT many people for publicly noticing the astronomical rape rate, etc. etc.
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From the perspective of someone in America the complete non-consideration of the possibility that "European culture" may, in fact, not be superior to American culture is galling. It's as if the possibility doesn't even register in these people's minds.
"European culture" kinda isn't a real thing right now, as they're not sovereign in any meaningful sense and basically just act as US vassals. The postwar social engineering gave them a synthetic culture that lends itself only to this role.
The only sort-of exception is France, and even then, they only tend to exercise sovereignty in cases where it doesn't really matter.
Even in cases where it kinda looks like maaaaybe Europe is exercising some degree of sovereignty, e.g., fining big US tech companies, it's really more akin to acting as a wing of the Democrat party than an act of actual sovereignty. An act of actual sovereignty would be building their own social media site / web browser / mobile OS / desktop OS, and obviously that never happens to any degree of relevance (and when it does, they immediately hand it over to the Americans like they're supposed to).
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Where did the poster that you are responding to even suggest that "European culture" is superior to American culture?
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This is out of date if it was ever true at all. Maybe you could say this about a broad subset of the American Right when the Neocon movement was at its peak circa 2002 or so. But the Left has never really subscribed to that at all, and the modern Right is increasingly dominated by its own brand of oikophobes due to woke backlash.
The left absolutely subscribes to America being number one, its just their version of America instead of what America actually is or what the right and normies say they want. What the left wants is hard to pin down, but I'll stake it on some form of vague internationalist semisocialism that serves primarily to keep their own enemy, the right (kings, kulaks, landlords, their dad) in the ground and they themselves on top - with a similarly vague hope that everyone else who helped the leftist get on top of the pecking order will accept that leftists ascension as a fait accompli.
If I'm from Mars and landed my saucer in America to take it over, would you say that I wanted America to be number one, I just wanted this to be an America run by Martians?
"I want America to be number one" has to imply a certain amount of respect for America as it is or the idea becomes meaningless.
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I’m not sure what you and @TheAntipopulist mean by “the Left”. I’m sure actual American Marxists (all five of them) are genuinely committed to the international cause of the working classes. But the broader liberal left and the Democratic Party was already pretty nationalistic already, in a quiet polite Obama drone-strike kind of way. Then in the late 2010s they absorbed most of the never-Trump neocon right and now they are now absolutely rabid about it. That’s the quarter where the heavy American involvement in the Ukraine War came out of, and it’s also where you see most of the new Yellow Peril about the rise of China.
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Is it really oikophobia, or just political tribalism?
I still think that old proverb, "Me against my brother. Me and my brother against my cousin. Me, my brother and my cousin against the world." generally applies.
The modern right doesn't like woke progressives in "peaceful times", but I would imagine that after a natural disaster like a fire or hurricane, that most people, left or right, tend to put their differences aside and help each other out.
And I think with a truly "worthy foe", most Americans would set aside political tribalism pretty quickly, and band together against that foe. The problem is, we haven't had anything close to a worthy foe since the Cold War.
Economically, the Chinese are far ahead of where the Soviets were relative to the US during the Cold War, and the last time there was a hot war they chased the Eighth Army halfway down the Korean peninsula while at a severe technological disadvantage, so they seem plenty worthy to me.
For a more recent example/counterpoint (though still relatively ancient) look at the Chinese invasion of Vietnam. The Chinese got their asses wrecked in a month or so, where it took the US a decade to withdraw.
Americans have this funny, somewhat childish manner of scoring wars on style points. Basically it's a generalization of how tough guys in a bar in Alabama or whatever might boast. I lasted 10 years! I could go on, just got bored! One against ten! Machismo. Very impressive for scoring mates. The question is, have the objectives been ultimately achieved? What was the war even about? We don't really have a good understanding of what the Sino-Vietnamese war was about.
As for the objectives, here's the perspective from the other side:
It's similar to how Russians «lost» the Winter War. While it was a catastrophically bad, shameful operation and @Stefferi's people eliminated a much greater absolute and vastly greater relative share of the adversary's forces than Vietnam ever did, very impressively so, the question is: who got what he wanted? Who lost? Soviets achieved their minimal goals. Finns lost land.
Really? I thought it was a relatively straightforwardly punitive operation designed to punish Vietnam after Vietnam retaliated to repeated Cambodian aggression by invading Cambodia and decapitating their government (stopping the Cambodian genocide). Obviously the Vietnamese and Chinese both can claim to be the winners (Vietnam: we stopped them! China: we went as far as we needed to go to make our point!) but if the motives are obscure it's news to me. (And I would be happy to update my understanding here.)
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That depends on if the "FEMA tells employees to avoid houses with Trump signs" story was an isolated incident or not.
I think "most people, left or right, will probably band together in a disaster" is compatible with a single federal employee, who got fired for their actions, deciding not to help political opponents during a disaster.
And her underlings who complied with her directions
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Half of congress in the 80s had literally fought Japan in the Second World War, anti-Japanese hostility was far from purely economic.
China was at best a secondary antagonist in the Cold War (and no longer after 1972). Korea is little remembered, before the memory of almost all living Americans and the present state of North Korea means that most people have no idea of how involved the PLA was. So the last ‘real war’ that was USA vs China was what, the Boxer Rebellion?
It could change if Xi panics and decides to abandon the slow game for Taiwan (which would be surprising) by staging the most audacious possible invasion involving a first strike at American bases, but even in the event of a ground invasion (unlikely) I consider that relatively unlikely.
Some grand global game of competition in which AMERICA NUMBA ONE just doesn’t really exist in the minds of most Americans in the way it does for the Chinese or even for, say, the French. American identity is tied to more amorphous things that don’t really have anything to do with global affairs like the Wild West and country music. A Dane or Swiss will gladly lecture you on why Denmark or Switzerland is the best country on earth (both would be mostly correct). Americans don’t really do that except in a very tongue in cheek Team America World Police way and even that is mostly limited to the middle class.
Italians abroad will talk about Ferrari and Columbus and pasta. Americans abroad don’t really lecture anyone about Google and Microsoft and Chevron. It’s not shame in the German way, but it’s not really pride either; global economic and cultural hegemony just isn’t central to American self-conception.
Eh, the political class really does have Main Character Syndrome, in the sense that you hear things like "Venezuela is evading sanctions." Um, yeah? Venezuela is not, in fact, part of the US. US law does not apply in Venezuela.
The deliberate pretension of inability to comprehend this sort of thing is something the political class will have to come to grips with as the relative strength of US power wanes.
But US law does apply to US firms, and those firms are prohibited from assisting Venezuela in any way. The target of this statement is the former, not the latter.
The US is seizing tankers transporting Venezuelan oil in international waters close to Venezuela with neither the ship nor the cargo having any connection to the US. In plain English this isn't sanctions, it's a blockade. The US carefully avoids saying this through official channels, although Trump has used the word in social media posts.
The ship was sanctioned (for Iranian connections, not Venezuelan) and thus subject to seizure. Venezuelan oil exports are sanctioned. If you and (in particular) Europe wishes to use "sanctions" as some sort of intermediate path between pure diplomacy and actual warfare, there has to be enforcement of those sanctions. Otherwise sanctions are a farce.
The wording only matters in that a blockade is an act of war. Certainly Venezuela is free to respond to it that way. But enforcing sanctions isn't generally considered that.
Normally, "sanctions" refers to laws a state makes which restrict its own citizens, residents, businesses etc. (including foreign-owned businesses operating on its territory) from doing business with the sanctioned country, and increasingly to laws which restrict its banks from financing (even indirectly) transactions to and from the sanctioned country. (And it is effectively impossible to transact in USD without a US bank being indirectly involved, which is why US sanctions even in the conventional sense have such a powerful extra-territorial effect). Enforcement of traditional sanctions, like enforcement of the vast majority of laws, is territorial. States enforce laws against activity taking place on their own territory - even if in this case the aim is to produce an extra-territorial effect. The US has a long tradition of effectively enforcing sanctions by prosecuting US-based entities who trade with/finance sanctioned parties, and the EU has a long tradition of effectively enforcing sanctions by prosecuting EU-based entities likewise.
The passive voice is obfuscating what happened here. The US declared the ship "sanctioned" despite the ship being entirely outside its jurisdiction. (The claim that it was sanctioned for Iranian connections is a distraction - the ship was seized because it was trading with Venezuela. The US does not generally seize ships on the high seas based on vague "Iranian connections", because you are not pirates). The ship is "subject to seizure" as a matter of US law, because the US made a law which applies outside its territory. As a matter of international law, it probably isn't. (There are some technicalities here because most of the flags of convenience used by oil tanker operators are US client states - the situation where the US seizes a Liberian or Panamanian-flagged ship and the country of registration doesn't object is messy).
Regardless of legal technicalities, the policy here is seizing ships which export Venezuelan crude. That is the essence of a blockade. Is it an act of war? The Trump administration is deliberately blurring the distinction between peace and war here.
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Americans don't do that because we don't need to. We know we're number one, we know everyone else (especially the French, who hate it, but excepting the Chinese) knows we're number one, and there's no point in arguing about it.
Anyone denying America is #1 is silly
But on the other side, Americans going "we're #1 and always will be, lalalala I can't hear you" when anyone points out China's rise is equally silly.
What's the plan to stay #1? Because right now it's not looking like there is one (see: infinite US Navy procurement disasters, absolutely sclerotic internal politics, and the absolute whiplash of elected political leaders).
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Honestly, I think the "We're number 1" mentality is integral to American's self-conception, but it doesn't necessarily need to be on wealth/power. We were happily number 1 in Liberty for a long while without any corresponding wealth, and that high will sustain us long after our global dominance ends.
I wish I could agree. That is a future that previous generations would have been fine with, but modern Americans continue to value liberty less and less. See the steady attempts to carve away at the first, second, fourth, fifth, sixth, eighth, tenth, and fourteenth Amendments.
Just to mention a few.
The whole "private property cannot be seized" has to be one of the greatest missteps by the founders of the USA. There are lots of times where taking private property makes total sense (like income tax for example), even the US's current civil asset forfeiture regime leaves a lot to be desired.
What sort of actual beneficial policies would be prohibited by the 5A?
Also, it's "cannot be seized except for a public purpose and after paying just compensation". That's a fairly big omission IMO.
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You are unfortunately correct directionally, but you underestimate just how bad it can get in other places. We can remain "first" of a metric that craters globally for some time.
I agree, but will Americans still care that they’re first in liberty, or will they see that as an unfortunate holdover from earlier times? If things continue as they are, I think most Americans will see that as something in need of fixing, not something to proudly base their identity on.
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I agree with the general point about the US losing its broad supremacy. In many fields, America is well behind with little prospect of catching up and there is indeed an unseemly amount of American reflexive dismissal of inferiority. Too many clowns on twitter posting about blowing up the Three Gorges Dam. There's an alarmingly casual attitude to conflict in the information sphere of today's world, as though it's something you can just start and end as you please. War is the most serious matter there is, it must be considered coldly and carefully.
Won't the US enjoy a quantitative and qualitative superiority in AI though, based on the compute advantage, through to at least the 2030s? Chinese models are pretty good and very cost-efficient but lean more towards benchmaxxed than general intelligence. GLM-4.7 for instance, supposedly it has stats comparable to Opus 4.5. But my subjective testing throws up a huge disparity between them, Opus is much stronger. It one-shots where others flounder. That's what you'd expect given the price difference, it's a lightweight model vs a heavyweight model... but where are the Chinese heavyweight models? They only compete on cost-efficiency because they can't get the compute needed for frontier performance. If Teslas cost 40K and BYD costs 20K and Tesla doesn't just get wrecked by BYD, then it would show that there's a significant qualitative gap. In real life of course BYD is wrecking Tesla, they have rough qualitative parity and so cost-efficiency dominates. But Chinese AI doesn't seem to have a competitive advantage, not on openrouter anyway, despite their cost-efficiency they lack the neccessary grunt.
If AGI isn't a big deal and it ends up being a cost-efficiency game of commoditized AI providing modest benefits, then China wins. Zero chance for America in any kind of prolonged competition against such a huge country. America is too dopey to have a chance, letting China rent Blackwell chips is foolish. Too dopey to do diplomacy coherently, too dopey to shut down the open-air fent markets, too dopey to build frigates... America is probably the ablest and most effectively run country in the Western bloc overall. That is not a very high bar to meet. The US would need to be on another level entirely to beat China. It's that same lightweight v heavyweight competition.
But if AI/AGI/ASI is a big deal, then America enjoys a decisive advantage. Doesn't matter if China has 20 AGI at Lvl 5 if the US has 60 at Lvl 8. I think a significantly more intelligent AI is worth a lot more than cheaper and faster AI in R&D, robotics, cyberwarfare, propagandizing, planning. And just throwing more AI at problems is naturally better. There will be a huge compute drought. There's a compute drought right now, AI is sweeping through the whole semiconductor sector like Attila the Hun, razing (raising) prices.
China doesn't have the necessary HBM, the necessary HBM just doesn't exist. Even America is struggling, let alone China. Even if China had enough good chips to go with their good networking, there's no good memory to go with them.
In a compute drought, the compute-rich country is king. In an AI race, the compute-rich country is king. China would be on the back foot and need to use military force to get back in the game.
What does that gain you when China can move matter?
Exactly. Most of these takes suppose AGI is achievable on a real timeframe and that AGI then immediately shortcuts through the physical and political realities of the day. The majority of the West is hilariously obstructionist already, even if AGI happens it's not gonna assume direct control immediately.
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I don't think GLM is really that high. In my experience it may be more comparable to, like, Xiaomi V2-Flash or Minimax M2.1. Chinese ecosystem is uneven, and GLM team has massive clout thanks to their Tsinghua ties. I believe they're a bit overhyped.
It probably will have the advantage, but a) unclear what this advantage gives you practically, and b) the divergence from compounding this advantage keeps getting postponed. Roughly a year ago, Dario Amodei wrote:
Well, American companies already have millions of chips. We're nearing 2026. Multiple models trained on those superclusters already got released, RL cost is now in high millions, probably tens if not hundreds of millions for Grok 4 and GPTs, and likely Claudes. Result: Opus is not really far smarter than V3.2, an enhanced version of a year-old model Dario writes about, with total post-training costs around $1M. On some hard math tasks, V3.2 Speciale is not just like 20x cheaper per task but straight up superior to American frontier at the time of release. The gap has, if anything, shrank. Wasn't «gold at IMO» considered a solid AGI target and a smoke alarm of incoming recursive self-improvement not so long ago? V3.2-Speciale gets that gold for pennies, but now we've moved goalposts to Django programming, playing Pokemon and managing a vending machine. Those are mode open-ended tasks but I really don't believe they are indexing general intelligence better.
Maybe we'll see the divergence finally materializing in 2026-2027. But I think we won't, because apparently the biggest bottleneck is still engineering talent, and Americans are currently unable to convert their compute advantage into a technological moat. They know the use cases and how to optimize for user needs, they don't really know how to burn $1B of GPU-hours to get a fundamentally stronger model. There's a lot of uncertainty about how to scale further. By the time they figure it out, China has millions of chips too.
There is an interesting possibility that we are exactly at this juncture, with maturation of data generation and synthetic RL environment pipelines on both sides. If so, we'll see US models get a commanding lead for the next several months, and then it would be ablated again by mid-late 2026.
V3.2 was a qualitative shift, a sign that the Chinese RL stack is now mature and probably more efficient, and nobody paid much attention to it. Miles is former Head of Policy Research and Senior Advisor for AGI Readiness at OpenAI, and he pays attention, but it flew under the radar.
Another reason I'm skeptical about compounding benefits of divergence is that it seems we're figuring out how to aggregate weak-ish (and cheap) model responses to get equal final performance. This has interesting implications for training. Consider that on SWE-rebench, V3.2 does as well as «frontier models» in pass@5 regime, and the cost here is without caching; they have caching at home so it's more like $0.1 per run and not $0.5. We see how even vastly weaker models can be harnessed for frontier results if you can provide enough inference. China prioritizes domestic inference chips for 2026. Fun fact, you don't need real HBM, you can make do with LPDDR hybrids.
But all of that is probably secondary to social fundamentals, the volume and kind of questions that are economical to ask, the nature of problems being solved.
I think all of this is stages of grief about the fact that the real king is physics and we have a reasonably good command of physics. Unless AGI unlocks something like rapid nanoassembly and billion-qubit quantum computers, it may simply not change the trajectory significantly. The condition of being a smaller and, as you put it, dopey society compromises "compute advantage". Great American AI will make better robots? Well, it'll likely train better policies in simulation. But China is clearly far ahead at producing robots and can accelerate to tens of millions in little time given their EV industrial base, gather more deployment data, iterate faster, while American startups are still grifting with their bullshit targets. Similar logic applies in nearly every physical domain. Ultimately you need to actually make things. Automated propaganda is… probably not the best idea, American society is too propagandized as is. Cyberwarfare… will American AGI God really be good enough to hack Huawei clusters after their inferior Temu AGI has hunted for vulnerabilities in an airgapped regime for a few months? I think cyberwarfare is largely going dodo in this world, everyone will have an asymmetric defense advantage.
Obviously, that's still the most credible scheme to achieve American hegemony, conquer the light cone etc. etc. I posit that even it is not credible enough and has low EV, because it's an all-or-nothing logic where «all» is getting elusive.
"Tech talent" isn't just one thing. There's the ability to glue together lego blocks on one hand, and there's the ability to make new blocks on the other. West coast tech has tipped decisively to the former.
Over the past 15 years in the bay area tech universe, we've seen a hollowing out of hard technical skill. The slop-shipping proudly-know-nothing React SaaS archetype has become predominant.
Even at the frontier labs, the talent pool is such that Chinese model architectural improvements often arrive as surprises and force rapid catch-up. The labs aren't interested in actual innovation: when they're not up their asses in "AI safety" power fantasies or practically orgasming on Slack about how they will allocate scarcity in the coming AI command economy, frontier lab people are mostly just scaling up what they know works and putting down weird ideas that they claim won't scale.
This is the part of the country that spawned Esalan. The grift has always been strong here. But lately, it's become next level and eroded meaningful expertise. When some TypeScript weenie who has no idea for a CPU cache works overrules the guy who does on the basis of some quoted Twitter pablum about software engineering being obsolete in six months, the industry is in trouble.
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Maybe it can't hack the servers directly if they're airgapped (though I wouldn't underestimate the power of some social-engineered fool bringing in a compromised USB) but it could hack everything around the servers, the power production, logistics, financing, communications, transport, construction. I doubt the servers even are airgapped, modern data centers are saturated with wireless signals from Wi-Fi peripherals, IoT sensors, and private LTE/5G networks. The modern economy is a giant mess of countless digital parts.
I think people underestimate the power of 'nation of geniuses in a datacentre', even without any major breakthroughs in physics, I think mere peak human-level AIs at scale could wipe the floor with any technological power without firing a shot. In cyber there is no perfect defence, only layers of security and balancing risk mitigation v cost. The cost of defending against a nation of geniuses would be staggering, you'd need your own nation of geniuses. Maybe they could find some zero-day exploits. Maybe they could circumnavigate the data centre and put vulnerabilities in the algorithms directly, find and infiltrate the Chinese version of Crowdstrike? Or just raze the Chinese economy wholesale. All those QR code payments and smart city infrastructure can be vulnerabilities as well as strengths.
China's already been kind of doing this 'exploit large high IQ population' with their own massive economic cyberwarfare program. It works, it's a smart idea. 10,000 hackers can steal lots of secrets, could 10 million wreck a whole country's digital infrastructure? You may have read that short story by Ci Xin Liu about the rogue AI program that just goes around causing human misery to everyone via hacking.
I believe that the physical domain is trumped by the virtual. Even nuclear command and control can potentially be compromised by strong AIs, I bet that wherever there is a complex system, there will be vulnerabilities that humans haven't judged cost-efficient to defend against.
I think it's funny that we've both kinda swapped positions on AI geopolitics over time, you used to be blackpilled about US hegemony until Deepseek came along... Nevertheless I don't fully disagree and predicting the future is very hard, I could well be wrong and you right or both of us wrong.
Eh, I think Pokemon and vending machines are good tasks. It's long-form tasks that matter most, weaving all those beautiful pearls (maths ability or physics knowledge) into a necklace. We have plenty of pearls, we need them bound together. And I don't think 3.2 does as well as Claude Code, at least not if we go by the 'each 5% is harder than the 5%' idea in these benchmarks.
There is a perfect defense. We're just not yet willing to pay for it.
You can write probably correct programs. Properly structure them and incorporate all the necessary invariants into their proofs, and you're immune to "cyber" attacks from humans, ASI, and God himself.
The "just ship B2B SaaS lol" crowd doesn't understand math, much less proofs. You need a combination of economic and legal incentives to see shift software methodology away from React slop and towards rigorous, robust, engineering that comes with proofs of security properties you want to enforce. It won't be easy, but it can be done.
Or you can just throw your hands up in the air and claim the problem can't be solved.
And yet nobody is using provably correct software because the core requirement is 'does it actually work' not 'is it totally secure'. This is the first thing they teach you in a cybersecurity course, the mission comes first. It's not cost-efficient to security-max.
Only a strong AI can do this cost-effectively, not even the state actors can manage this, they get hacked all the time. And given we're talking about what happens when strong AIs first emerge, people are not going to have provably secure software already widely proliferated from kernel to application.
Also provably secure software limits you to a certain subset of the features available in most programming languages, since a lot of things in software/math/logic are inherently unprovable.
Yep, essentially you have to give up Turing-completeness to get provable correctness: no unbounded recursion or loops allowed. To formally verify, using a Turing-complete verification language/proof assistant, the correctness of an arbitrary program written in a (possibly different) Turing-complete language is tantamount to solving the halting problem, which famously is logically impossible.
Is your argument that all Turing-complete software systems are possible to meaningfully "hack" with finite knowledge within finite computational time? Can you prove this mathematically?
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Unless NSA overpays relative to FAANG and keeps everyone on an ideological leash the talent simply wont flow to the US state. The smartdicks with some vague natsec aspirations might go join Anduril to pretend at building Cyberdyne systems skynet. And thats only if Anduril stays off the DOD security asset whatever list so the staff dont get flagged at every port of exit.
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You misunderstood my point. I am saying that hacking as such will become ineffectual in a matter of years. Automated SWEs make defense drastically advantaged over offense due to information asymmetry in favor of the defender and rapid divergence in codebases. This “superhacker AGI” thing is just lazy thinking. How long do you think it takes, between open source AIs that win IOI&IMO Gold for pennies, and formally verified kernels for everything, in a security-obsessed nation that has dominated image recognition research just because it wanted better surveillance?
A very American belief, to be sure.
IMO Gold is an important signal but not that significant in and of itself, again, it's longer-term capabilities that matter.
To proof a complex system against hacking, you'd need ASI. This is a superhuman feat, no humans have ever written a provably secure system that actually does useful work as opposed to just being a toy proof of concept.
By the time these kernels come out and are deployed, it's pointless to hack the datacentre.
Thankfully, verifying proofs is easier than generating them, so we're about to find out if this is true.
Even finding all the things you'd need to secure is a nightmarish task. The CPU's physical structure, the microcode, the BIOS, the lower levels of the OS, a myriad of applications... You'd need a completely accurate, top to bottom model of the whole system: thousands of devices, routers, OSI... You'd then need to rewrite all of it while somehow maintaining proper functionality. Have fun updating the ROM of the management engine! Good odds there are physical flaws in CPUs that either humans are too dumb to uncover or were put there by intelligence agencies for spying purposes, so even if you do all that it still isn't sufficient.
ASI is a bare minimum requirement. Probably ASI + a whole new generation of chips is needed.
You're overrating the irreducible combinatorial complexity (especially given that we can improve modularity when software is this cheep) and underrating the computational efficiency. We're in the regime where 1M of near-frontier tokens goes for $0.3, caching-enhanced prefill is almost free. $300 for billion, $300K for trillion, $300M for quadrillion, $30B for 100 quadrillions. Will likely fall 10x within a year while performance creeps towards peak human programming skill, again. Bytedance is currently processing 50 trillion a day for Doubao, they have a near-Gemini 3 multimodal model (Doubao Seed 1.8).
How much is the entire specification of, say, a Huawei server's full hardware-software stack, all relevant documentation, everything? Maybe a few terabytes if we're obsessive. Blow that up 1000x for experiments and proof generation. A few quadrillions, plus the costs of software execution.
How much is invulnerability to ASI hacking worth? It's worth pretty much everything, given that the US is en route to have ASI and is psychotically attached to its finance-powered hegemony.
What is the alternative? Pretty much just preemptive nuclear strike.
They will be forced to do this.
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Agreed. I'm not convinced the space of exploits reachable via ASI is meaningfully bigger than the space already reachable by fuzzers, code analysis, and blackhat brains. ASI hacking is a fantasy.
That said, AI tools have, are, and will "democratize" access to exploits we already have. A lot of incompetent enterprise IT deployment people are going to have to get fired and replaced with people or agents that can keep up with patches.
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AI technological knowhow diffuses much faster than AI-driven technology, though. Lets say China is a year behind the US in AI research and engineering when the US reaches AGI. How long does it take the US to integrate it wholesale through its economy, replacing pretty much all labor? China will have its own frictions, but plausibly China can cut through physical, infrastructure, legal, and cultural constraints faster than the US. It's not clear which effect would dominate, but it's not preordained that the US would win.
Even a true singularity, if possible, doesn't seem to change that. At some point the US may well have an ASI that has solved all the fundamental physical, engineering, and mathematical issues of the universe while still requiring human doctors, teachers, drivers, soldiers etc. to perform actual labor, while China at the same time is stuck with a year-behind AI that nevertheless has still replaced human labor in all relevant real world domains.
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The new Chinese ASIC accelerators designed for 8bit FMA are going to be a game changer. Nvidia acts like it's still king but soon new way cheaper chinese tech is going to be online and NVIDA is going to eat dirt.
I don't believe that any specific accelerator will change the situation much. “ASIC” is a meme, Nvidia's Vera Rubin are probably very close to optimality, they're no longer GPUs in a meaningful way.
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Google's had that for a decade.
Yeah, and I can buy exactly 0 servers kited out with those.
You won't be able to buy the Chinese ones either.
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You can make an absolute fortune on that prediction, if it comes true.
The problem is I don't trust the Govt not to pull another fast one like they did with the cash infusion for OpenAI. They will NOT let NVDA tank, the market can remain fraudulent longer than you can be solvent.
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Sorry, risk aversion. The probability that would let you say "that's pretty likely" is not the same as the probability that would make it make sense to sink a lot of money into something. If I thought it was 80% likely, for instance, I certainly wouldn't take that 20% chance of losing my shirt. At best I might slightly change the distribution of money that I was going to invest anyway.
If you thought it was 80% likely, you can get a spread of buy options for various times/prices. The loss (and gain) is completely bounded up front.
Then that wouldn't count as an absolute fortune.
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Sounds like you're thinking you'd lose all that money if it went badly. Why would you? Mental and automatic stop losses exist.
It is not possible to 1) lose nothing if it went badly and 2) make a fortune if it went well.
You can't be an investor if you're not willing to risk something.
I just said "risk aversion". That's the whole point. You can't make an absolute fortune without risk, and I don't want to take the risk. The implication of
is that anyone who really believed that would spend their money on it in order to make a fortune, and that anyone who refuses to spend the money doesn't really believe it.
This implication is not true when there is risk.
This is just a slight variation on "you don't really believe it, because if you did you'd bet money like a real rationalist".
It's just as true when there's some risk. There's always uncertainty when putting money in an asset.
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I'm sure there's ways of structuring your bet so that you've got bigly upside on being right without your positions immediately resolving to 0 in the event of a miss. It's not like you're doing it solely through binary options or prediction markets, equities provide all sorts of pathways whilst still being broadly positive sum.
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I don't really understand where you think America, or any other nation, is going to fit into the picture at all if your predictions of Chinese dominance come to pass. What is China going to buy from the US in 2038 in your view? They have a long track record of having an industry come into their sphere and then replicating as much as their can of it and then push out the competitor before exporting their version to any market that will take it. What are other trade partners supposed to do with a nation that's long term goal is to not buy anything from their partners? In the mean time I understand the economist position that says this is an obvious surplus, china sends us goods for pieces of paper, why look this gift horse in the mouth? But What happens when this happens to every industry?
I don't follow Noah too closely but in this piece recently I think he's spot on.
With the American hegemony other nations have options. Americans are happy to let other nations lead in some industries and rely on them long term. We're happy to buy Korean appliances, Japanese cars, European fine crafted goods and Columbian cocaine. If you want to build out a niche the American empire is happy to let you have it and integrate into the global family. This is not how China acts. China doesn't tolerate this kind of interdependence. I don't really see how you think allowing them to take up the dominant position in every industry is long term sustainable. Even in your post you talk about how China is already doing industrial policy to try to make sure that nvdia's position is obsoleted as soon as possible through energy subsidies.
The US is self-sufficient in almost everything. It does not need to trade with China in order to remain a great power.
And more specifically, the US can likely maintain itself as the hegemon of the western hemisphere and remain the richest country on earth. It does not need china.
100% yes
How? A significant % of that wealth was built on leveraging Chinese industrial production and being the primary/a majorly significant trade partner to the rest of the world.
American consumerism is built on buying cheap Chinese stuff. China has overtaken America as the primary trade partner in a huge % of the rest of the world, and that trend isn't getting better for America, especially thanks to Trump's trade policies.
How will America be the richest country on earth when it's consumers dollars don't go as far, and a large % of the world won't buy things from there anymore.
Pivoting to buying cheap Mexican and Brazilian and Argentine stuff isn’t that hard.
That would require a level of industrialization in Latin America that seems unlikely, barring direct American conquest and economic administration (and good luck with that).
Mexico already has one of the largest industrial sectors in the world.
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I think this is somewhat incoherent.
Your narrative is a bit out of date. How will Europeans pay for Chinese imports if China has no need of their exports (in «fine crafted goods», services or anything)? Maybe they just won't, if China can do all that fine crafting cheaper and better. But they will face the same issue with American imports, indeed already are facing:
American Hegemony is not about building some happy global family with a division of labor. From software down to extractive industries, American Empire wants to be like Emperor Qianlong said: «our Celestial Empire possesses all things in prolific abundance and lacks no product within its own borders. There was therefore no need to import the manufactures of outside barbarians in exchange for our own produce». Currently, the Chinese economy is pretty export-dependent, but Xi would prefer it to be otherwise – Dual Circulation is a big pillar of his policy, and in purely thermodynamic terms, if literally everything is cheaper in China, you can ignore standard macroecon, largely eschew exports, subsidize domestic demand and make Qianlong's boast a reality.
The main difference is that China got there with industrial policy and human capital, and you're trying to get there with tariffs and coercion and a Wunderwaffe. But the end result is the same for non-live players.
Back then, I asked for what the end game of AGI race is, and you said:
A center of commerce in what sense? The US currently has a very low fraction of international trade in GDP – around the level of Pakistan. The US wasn't a global center of commerce during its ascent either. You pat yourselves on the back for importing some junk but it's not really spreading a lot of your wealth around, it's only large in absolute terms. China is simply already doing what you want to do once you get «AGI», and by 2038, if AGI plans pan out, your narrative will be laughably quaint.
Moreover, what's wrong with that? Both nations are large, decently situated and can, in theory, produce all goods in prolific abundance within their own borders more economically than imports would be; and China is entitled to a larger and more diverse internal market on account of population size. There are some hard natural endowments – Australia has more accessible mineral wealth, Atacama desert has excellent solar resource, I don't know – but commodities are cheap. Maybe they'll become less cheap? What remains scarce after labor and R&D are commodified? Land? Copper? Wombs? We need to think of how the world would operate when major nations are capable of industrial autarky, because modulo some Butlerian Jihad we will have to deal with it anyway.
Finally, what exactly is your concern? The US imports more than it exports not out of some moral commitment to subsidizing globalism, but just because it has very credible IOUs to sell. You basically print USD and export inflation. The EU can't do that. China can't do that. Chinese industrial competence doesn't have a direct effect on that, they cannot deny you the ability to print paper and buy Columbian cocaine. Trying to rationalize the take – you deserve hegemony because what, it'll mean unquestionable military supremacy, hard guarantee of your IOUs, and therefore indefinite ability to exchange goods for paper?
Yeah, I think it's less sustainable than «China is a very large and very productive autarkic country». They've been exactly that for centuries, and the world managed fine. In the limit of this trajectory, they will only need to export enough to cover the raw commodities imports necessary for their internal economic activity. That's not a lot, in dollar terms. The more interesting question is what else we all will be trading in 2038.
Capital begets capital. Increased capital concentration decreases costs of production and labor requirements. Left to expand forever, no one should ever catch up - but everywhere but China (so far) the greatest capital accumulations eventually succumbed to suicidal regulation and extracting value to subsidize non-productive sectors.
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A lot of your links seem to be broken and affixing themotte's url in front of them.
I guess I should have noted that I oppose Trump/American Autarky designs in the strongest terms. The man is without vision or sense and deviates wildly from decades of American policy.
It should probably be noted that this policy of autarky didn't exactly turn out well for China over the following two centuries ending in their century of humiliation. The period itself was also an aberation as China was center to a vast trade network before the Qing. Do you have some theory of the recent rise of China that does not require the liberalization of its markets? Explanations for its backwardness coinciding with their close? I suppose this time could be different, China woke for a few decades, learns all the world's secrets and then returns to slumber dead to the rest of the world. But I think the Chinese are smart people, they won't repeat that mistake.
And no, the American hegemony has not historically been about autarky, We've historically traded security guarantees for access to international markets.
Tariffs are industrial policy and of course China imposes tariffs and had before the trade war. This is simply a game of Russel conjugates. I again oppose Trump's buffoonish actions but to think the CCP doesn't employ coercive tactics in trade is pretty surprising. This is a place with a habit of outright banning outside competitors, not just tariffing them. market access for IP bargains, forced technology transfer, straight up state sponsored industrial espionage and Cyber theft(APT10, PLA Unit 61398, Equifax hack, ect). It's just not the case that China has risen in some saintly within the rules manner.
This conflates a few different worlds. My model for an ai future if ai drops marginal labor cost to the base electricity needed to complete the task(but doesn't go infinite intelligence like the yuddites expect) isn't every nation turning inwards, like civilizational wire headers. I find that a bleak image frankly but I suppose some may and China may be one that does if that comes to pass. I don't find that future particularly likely really. And if it goes all the way to AGI then all I know is I want someone with my interests to have been the one to do the alignment work.
This map just seems to be a measure of economy size relative to nearest neighbors, no? Mongolia isn't a huge player in the international trade Arena, it's just landlocked between two countries with economies that are much much larger than its.
this is an interesting point and framing, thanks. I hadn't been thinking of the precise scenario where labor costs drop to marginal much. It does seem far-fetched but we are in the time where far-fetched things happen. I still find things shaking out this way unlikely and if they do I think the world would be unstable. When labor is very cheap and raw materials, even if they can be harvested much more efficiently, are the scarce thing then what is the offense/defense equilibrium?
also replying to this comment
The CF40 piece is interesting but doesn't address my point. They're arguing PPP calculations understate Chinese purchasing power, that Chinese people get more stuff per yuan than World Bank stats suggest. I'll grant it all for the sake of argument because the PPP discussion is boring and one can look elsewhere for it. My claim was about income distribution, not purchasing power. Household consumption being 40% of GDP means households receive 40% of national income to spend. The rest goes to the state and corporate sectors, funding the investment-heavy model. Even if every yuan buys more calories than we thought, that doesn't change the share going to households versus the share going to industrial buildout.
This matters because the investment heavy model requires external demand. Household savings fund the investments through financial repression - artificially low interest rates transfer wealth from savers to state-favored borrowers. The resulting production has to go somewhere, and domestic consumers don't have the purchasing power to absorb it because their savings were the input. Rebalancing toward consumption has been official CCP policy since 2006. In that time, household consumption has moved from
35% to38% of GDP. They know the problem. They haven't solved it because the mechanisms that suppress consumption are load-bearing for the political economy.Not so fast, different systems of national accounting and different relative prices complicate matters.
Chinese housing area/person roughly equals Germany's and energy consumption is nearly there, yet constitutes 25% of Geman PPP GDP per capita, with about 12.5k rent/utilities. Would both use similar systems, China's would be about 10k PPP, while lised PPP GDP/capita is... about 25k. Yet Chinese don't spend 40% on housing and energy, indeed housing's only a few percent of Chinese GDP (this is the imputed rent issue I harp on about). Remember, this is all PPP - supposedly adjusted...
Where US retail sales are 7.3T and Chinese 6.6T, US HFCE is 20T or 2.8x retail sales, while Chinese's is about 6.8T or 1x retail sales? (Then consider changing exchange rates when making the dollar numbers.) How can you compare US and Chinese numbers when the US' includes education, healthcare, travel, imputed rent and China's is just retail sales? @sarker
Oil demand is decreasing if still slowly. Gasoline use is down. Last year, heavy vehicle use made up half of Chinese LNG consumption, which would look like substitution - but LNG demand is decreasing faster and faster. Huge solar and nuclear build outs are taking over (coal consumption is also dropping due to rapid construction of more efficient plants) and today, 22% of new heavy trucks there are electric. China is also building out synthetic natural gas plants enabled by cheap solar creating an effective price ceiling at $80 BOE.
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He has a vision, though we can debate the merits of that vision, I agree he's a pretty vulgar individual and his execution is often appalling. But was “decades of American policy” sustainable? The permanent deficit only makes sense if you can serve the growing debt indefinitely. Why should we assume that this can hold? As I've said multiple times, Trump is correct in his diagnosis even if ham-fisted with treatment. If America becomes materially productive, it will diminish European share of the pie, you can't sustain your consumption with just soy and LNG exports, something has to give. Or what is the idea, make AGI and sell tokens instead of IOUs, in exchange for TRUMPF machines? I guess that can be argued, but far as I can see, nobody argues for this. Do you argue for this?
It wasn't so much about trade autarky as about comprehensive intellectual isolation and stagnation, the Qing did not understand the world outside China's borders and honestly bought into the idea that they'll naturally be productive enough to not worry. Qianlong still had some clue, thanks to Heshen, who was ultimately executed for vast corruption, leaving the Qing blind for decades. Then, it was too late and they grew too dysfunctional to modernize like Japan. By First Opium War, Daoguang emperor didn't know where Britain is. It was a pathological regime preoccupied with managing a quaint and unnatural arrangement of Manchu superiority. I definitely won't say their trade policies made sense but it is just a small part of overall Manchu awfulness. Though to be fair, Manchus were following the Ming with their tryhard Confucian disdain for trade. By 1736, China had mostly lost its ironworking. Insularity is the dominant Chinese policy for many centuries. We need to go back like 1000 years to see China that's even remotely as trade-oriented as the modern one. And yes, none of this is plausible in the modern world with high-density information flow.
Anyway, what does it matter? People complaining that “China is making trade impossible” don't mean anything like Ming-style ban of maritime commerce. They mean precisely the opposite, that Chinese exports are too cheap and abundant, and call it unfair. What exactly do you want them to do? Enforce the internal demand for more expensive foreign goods, such as subsidizing private consumption of Macbooks? Get worse at manufacturing? Make their subsidies as ineffectual as European ones? Focus on welfare spending, until they get old, slow down their value-add climb, and fall behind far enough to balance trade? It's just hopeless demands to change their value system, they won't change it. Keep raising tariffs if you don't want to compete on prices. 100% on EVs, 200% or whatever on solar panels, outright ban on Huawei… seems to work, keep going. American deficit with China is already shrinking.
American hegemony itself is a very recent phenomenon, and may have run its course. America was a relatively prosperous and absolutely powerful nation before it became “a hegemon” and so massively involved itself in Old World affairs, for intrinsic reasons of having a large internal market, little red tape, and good geography.
Your security guarantees don't look very credible and monetizable now.
I don't oppose any of that, it's fair game so long as it works. By coercion I mean buffoonery like forcing allies to invest in American production or Lutnick's machinations around TSMC (again, “security guarantees” come into play). China simply can't do any of that, irrespective of morals. It can only offer terms of the deal and expect consent. JVs were not coercion. Expropriation of Trina Solar, meanwhile, is coercion with extra steps. But whatever, this is sliding into moralism, everyone will price in those tactics and act rationally.
Pretty much, but that doesn't change the conclusion. The US is a vast economy. China is becoming comparably vast (or is already bigger depending on how you count), and specifically on goods production it's just no contest. Such economies gravitate towards autarky, both for security and macroeconomic reasons and because of basic logistics.
I repeat that Chinese household consumption is underrated due to in-kind transfers (such as all this public infrastructure), while American consumption is overrated due to Baumol disease. CF40 doesn't just argue that they're even richer than PPP suggests, and consume on par with developed economies (just not the US). It argues that they spend 20 times less on healthcare and get comparable outcomes. Americans cannot not consume some of these items, their floor for cost of living is just too high, you physically cannot survive in a modern city for $137 a month for two people over 3 years, and for the Chinese the ability to do that is subsidized by in-kind transfers. There can be a spirited defense of American consumption pattern, about allocation efficiency or whatever, but the crux is that while the Chinese are directly extracted from to build up physical capital and trade competitiveness, Americans are indirectly extracted from to make pharma/hospital/insurance company etc. stonk go up, charitably – fund R&D and reinvest into tech. The latter is accounted for as “consumer spending”, the former is not, both are effectively non-optional capital transfer from civilians to the national backbone, largely physical in their case and largely financial in yours. I think that when all is considered fairly, both nations have about 50% “real consumption” share of GDP.
Right. That's the big question, isn't it.
I could go on at length about my problems with Trump but at the hope of not starting too many skirmishes with this forum I'll limit myself to saying that Trump's gift is identifying an aggrieved feeling in his base and validating/stoking it. If that means vanquishing woke, which I mostly agree with, he will try to do that. If that means striking at China who much of his base holds responsible for decaying rust belt towns then he'll do that. He is not setting out to balance our budget or deal with the infinite deficit, he has increased the deficit. Long term sustainability is not something he cares about, part of his appeal that got him elected was dumping the idea of sustainability by breaking the GOP on Medicare's obvious unsustainability. He's a slop populist that refuses to acknowledge trade offs, a national embarrassment. Perhaps the only thing worse than him being in charge is the Bernie wing of the democratic party that looks to Europe's fat decay into a retirement home with envious eyes and wants to squash our attempt at relevance through ai dominance with pure stupid ludditism.
If you've said Trump is right in his diagnosis of the American sickness multiple times then you've been wrong multiple times, Trump doesn't know about or even think about the American sickness. He has diagnosed the ugly populist urgings of his base and as people are often mad about real problems sometimes strikes out at those problems in total ignorance of their structure. Our problem has something to do with trade so he strikes out against trade, broadly, untargeted and with great zeal.
well no, it's your model that we should be trying to sustain our consumption with just Soy and LNG exports, the raw commodities while every nation does their own production. I think we should continue to try and dominate in aerospace, tech, entertainment and other industries. We should happily let ASML dominate in fab design, TSMC dominate in fab execution(although China hungrily eyeing their island for conquest does justify some industrial policy to move that particular industry into safer territory), Samsung dominate in RAM and maybe we could encourage some home grown competition but integrate with the partners without like, doing state sponsored spying on their designs to that end.
I have to point out that China is led by an aging dictator who has progressively isolated himself from the type of people who would bring him bad news. The whole autarkic emperor blinded to their weaknesses and his subjects being afraid to tell him he's wrong seems to me at least as good of an explanation for denial of NVDIA imports as some pending competitive domestic chip manufacturing that you seem to think is likely. And it parallels nicely with your history lesson, which I do genuinely appreciate. I try to not let my bias for democracy show too prominently in my analysis, but it seems important to point out the downsides here and also that it's not clear how succession after Xi is done is supposed to work smoothly.
What I'd like is kind of like an onion, we've got a few layers here.
At first are the demands I have for my own government that started our back and forth a while back. I want to not surrender our advantage for no real gain. You seem to oscillate between claiming NVDIA is going to establish some kind of vendor lock in while also celebrating an impending Chinese internal semiconductor champion that will make refusing to export toothless anyways. Either lock in is real or it isn't. If it's real then surely China's efforts won't mean much if they can't even get their national champion to use their home grown chips. If it's not, and this is my position, then we should under no circumstances allow NVDIA to export our most powerful chips to China. And I don't want to hear any free trade paeans on this, China wipes its ass with free trade.
As for what I want China to do. Well I do have family there now, they're more privileged than most Chinese people so the reforms I'd like aren't exactly for maximizing their benefits, but I'd like China to shift its focus from out competing the world and territorial conquest to getting its internal household consumption up. I'd like further Hukou reforms so there are fewer second and third class Chinese citizens. I want to see more of the returns from China's growth go to improving the quality of life of Chinese people rather than Xi's vanity in needing to dominate every market that exists. Step away from autarky. Perhaps geopolitically untenable but I'd also like to see them stop aiding Putin in his horrific war in Ukraine. Of course this is a bit of the awkwardness that I've just listed a bunch of things in the "what if we pretend AI is a mundane technology" world. What I want China to do if AI is a pivotal technology is to lose to America in a race to develop it, I would understand if Xi declined, but he doesn't seem particularly AI pilled honestly.
which ones don't? Yes, Trump is a bully to our allies in an embarrassing and disgusting way, but the line people are fighting over right now is how much we should be materially supporting people who aren't even our allies and just have implicit value to people that are our allies to prop up.
I'll continue to not want to defend Trump policies but will point out that this is similar in effect to Chinese Market access for IP and tech transfer policies where China gets a substantial amount of the return on foreign investment and then forces the foreign competitor out once it can replicate the production anyways. At least Japan would get some lasting equity in this deal formulation. China's high-speed rail program was built on technology transferred from Siemens, Kawasaki, Bombardier, and Alstom. Do those companies or their home countries enjoy any stake in CRRC's international expansion?
There's a big difference between aggressively pursuing autarky and just the natural internal trade that exists because you're a big country and most of the things you buy aren't hyper specialized products. I keep hammering this because it's important. America doesn't, or at least didn't, see it as a problem that its most advanced chip products are the result of cooperation between firms for dozens of countries. Yes, if you're buying groceries in the US then naturally they will be sourced relatively locally and generally the most common things a person consumes are commodity and service products that don't gain much by having a long supply chain. Every local area is probably going to need to answer the "where do we get milk from?" question in their own way. Not every local area should try to answer "how do we design cell phones?" for themselves. If they have a competitive advantage in cell phone design, or some step of the process, then sure go ahead, but autarky is the madness that has Trumpists trying to figure out how they're going to produce coffee beans in the contiguous united states hundreds of miles from where they can grow effectively.
well, kind of. The high speed rail buildout you may have a point. But the excess industrial buildout? That's going into exports. It's the Americans and Europeans enjoying discounted goods that is enjoying the surplus here. At least the American excess spending is circulating among American Doctors and Pharma companies, which yes are actually making miraculous drugs.
Baumol's applies to all sectors, household, state and industrial at least equally, probably more to state, so this can't explain inflated household consumption as a percent of gdp. It's the same factor in all sectors, it cancels out.
Normally if a point isn't responded to I don't insist on bringing it back up but I need to make an exception here. It's really important that the whole Chinese industrial production system relies on exports and the CCP has been unable to change that fact despite ticking past two five year plans of it being a goal. It just is the case that Chinese people enjoy less of the fruit of their labor than Americans do.
It certainly seems like a question central to the world of inward facing nations you're putting forward. How is China getting the 70+% of its oil imports in this future? The iron ore? The soy beans? Surely they have resources but this seems a hollow sort of autarky.
OK, but how does this make the previous system sustainable? You consume more than you produce, and you cover the delta with IOUs. It's a time bomb, people just got accustomed to the explosion being repeatedly postponed, developed a mindset that American “reserve currency” grift is so strong that this is no biggie. I think they're wrong.
Unfair. As you can see I'm arguing in favor of selling high-end GPUs, where you actually dominate. Soy and LNG obsession was Trump (before recent course adjustment).
You currently can't “not let” them dominate there, they are simply dominant, like you are in aerospace, so it's not exactly a choice. And in your own logic, all of that “let” becomes effectively charity soon after you have AGI (unfortunately, a necessary evil to fight Red Chyna!). It's just a question of maximizing comparative advantage by tolerating division of labor, while you complete the Total Labor Eraser Machine 9000; in fact a continuation of the earlier mustache-twirling “let the broke ass yellow bugmen assemble our gadgets for pennies, while we deepen our design and basic research dominance” strategy, justified by the Smiling Curve logic. Sorry, one doesn't have to be Xi to see how it works.
And of course, your personal distaste for Trump won't change the reality of him forcing allies to rebuild their core industries in the US. This is American policy for the foreseeable future and I don't think it'll be rejected by the next admin, like Biden didn't reject and only reinforced core pillars of Trump's China policy.
Xi was born in 1953. He's 72. Trump was born in 1946, like George W. Bush and Bill Clinton. I get the “leaders are like underpants” logic but humans are not really underpants, which quickly get dirty but do not appreciably age in storage; and I wonder if a well-functioning autocrat really is worse than a structural inability to elect people born after 1946 AD (Biden dates back to 1942, of course). Xi's father lived to 89, after 16 years of persecution. A very interesting man. Xi's mother is apparently still alive at 99 years of age. I think Xi is pretty damn lucid and will remain so for another decade, and the “progressively isolated from bearers of bad news” bit sounds like a lazy trope. Maybe Zero COVID applies but that was more about excessive paranoia than desire for good news. He's quite obsessed with calamity consciousness and “preparing for danger in times of peace”. Xi's China has systematically derisked its position, to the extent that when Trump ranted “the U.S. has Monopoly positions also, much stronger and more far reaching than China's. I have just not chosen to use them, there was never a reason for me to do so — UNTIL NOW! … For every Element that they have been able to monopolize, we have two.” – it was hot air.
Apparently you think that the reason China could only take export controls on the chin 6-2 years ago, and can clap back and force US concessions now, is just that Trump is a venal corrupt moron and in fact he did have those two elements. The fact of the matter is that he used to have them but does not anymore, because Xi is not like Trump, nor like Putin. In 2018, when Trump cut ZTE off from US kit, Chinese state newspaper “Science and Technology Daily” published a series of 35 articles “What Are Our Chokepoints? Core Technologies We Urgently Await Breakthroughs In”, obviously building on Xi's rhetoric. I recommend reading it in detail. Xi kept scolding everyone for not doing enough – in 2020, in 2024. As of now, at least 30 out of 35 items are deemed solved. We know very much about their efforts to break all such chokepoints, they are in fact increasingly well organized, the graft of Big Fund I was eliminated. This is not the behavior of a delusional autocrat in an echo chamber. Your whole society looks more like an echo chamber, given how shell-shocked DC China Watchers were after Oct 9, how they kept saying that Xi miscalculated, overplayed his hand or whatever. He clearly did not.
But I don't expect to convince you. “Arrogant power-hungry strongman kills goons who report bad news” is a staple of your scholarship, a justification of your system, and a powerful trope of your media culture. After all, Free American Men do not need to stoop so low as to seriously scrutinize the policies or behavioral profile of some bugman chief (who wasn't even born in 1946 AD). It's not like there can be any consequences of being wrong.
I think they're much more afraid of lying than of any demotion for underperformance, because being implicated in some graft gets you expelled from the party, jailed or executed, and the CPC is designed with good incentives for mutual surveillance. Of course there's the American trope/cope that corruption investigations are just selectively applied for “purging rivals”, everyone is corrupt and corruption adds no risk. We'll see. For now, you can be thankful to Xi for doing USG's proper job of not letting advanced chips into China.
I don't oscillate, those processes are just in tension. Liang Wenfeng said: “NVIDIA’s dominance isn’t just its effort—it’s the result of Western tech ecosystems collaborating on roadmaps for next-gen tech. China needs similar ecosystems. Many domestic chips fail because they lack supportive tech communities and rely on secondhand insights. Someone must step onto the frontier.” And yet even DeepSeek has not yet trained anything on Ascends. You need usable chips and frontier AI talent, working together. Frontier talent has options – go to the US, work with domestic chips under duress, work with Nvidia chips in the PRC (but those were becoming scarce), work with domestic chips because they literally are the only thing they can get, and so on. Nvidia can create a vendor lock, not unbreakable in principle, but sufficient to slow down their ecosystem and prolong the vulnerability to export controls. Domestic chips will have both low utility and slower hardware progress if domestic software has no adoption at the frontier. China ultimately wants good AI and less talent flight (that is a thing, you realize) and so won't meddle egregiously in frontier roadmaps.
Their plan seems to be letting Tier A labs do what they want with their own money, subsidizing power for domestic compute, forcing Tier B to match procurement of Nvidia/AMD with domestic compute, and building public datacenters with domestic compute. In time, this will result in an okay-ish domestic ecosystem and wider adoption of those chips, after which they may require, incentivize or naturally get some frontier training runs. But the end goal is to downgrade Nvidia from a chokepoint to basically another commodity, not ban it. They can ban commodities in retaliation, as with soy, but it's not about a commitment to never buy American produce. So long as they have security and optionality and it makes basic economic sense, they don't mind importing soy, or LNG, or chips, or airplanes, or anything.
indeed. Except, “every market that exists” is the same issue as a singular pivotal technology. The simple fact is that either you move up the value chain relentlessly, or you get some sort of “lost decades” or “middle income trap” and then you're American chewing toy. When you actually have the potential to be a great power and not just some cute intermediate supplier with no security like the Netherlands, Americans will chew on you until you have no potential. China is not special, it's just the only remaining contender after Europe and Japan were done with. Clearly an American can have Chinese family and remain committed to the hegemonic project. All you can offer to the weak is to be in your orbit, sell cocaine or cheeses or whatnot; all you can offer to the strong is defeat. That's normal realpolitik. I just want you to acknowledge that the noise about “quality of life of Chinese people” is disingenous.
Bought and paid for, minor (yes, minor) extralegal fraction aside. Unlike Japan, these nations were not forced to transfer technology under duress, as China does not control their security.
There's also a big difference between being on the giving or receiving side of export controls and Wassenaar Arrangement. This isn't about Xi bad, Americans have been working to keep China non-competitive in the semiconductor segment for at least over three decades: “We found that the executive branch practice was aimed at keeping China two generations behind the U.S. semiconductor manufacturing industry. On March 1, 2001, the under secretary for export administration (a policy-level official), described this practice and reconfirmed it in a follow-up January 2002 meeting with GAO after he left office”. That's “Jiang Zemin good” era, growth, engagement, all that soapy bullshit. Meanwhile, your semiconductor industry is heavily dependent on Chinese brains. I won't moralize on the hypocrisy and laughable entitlement, obviously you feel entitled to allocating progress conditional on how much you like a given regime. After all, “if we weren't worthy, they wouldn't have come”. The point is that even modulo their autarkic preferences, proactive derisking – for every industry with a chokehold – makes perfect sense.
Speaking of local cell phones. I loved Nokia. Very cute story of plucky little Finland doing well in tech, connecting people, all those 3310 memes. The era before total Chimerica dominance. Was pretty sad when it got killed. I recall @Stefferi even speculated that it led to the decline in birth rates. I suspect Elop did that intentionally, though he just wanted to deliver fresh game to Microsoft and fumbled the company altogether. Now it's either iPhone or Chinese phones, and you tried to kill Huawei too.
This is partially fair. There are two components to this. One is subsidizing the base undifferentiated layer of economy - energy and raw materials, agriculture, infrastructure, “wasteful SOEs”. This makes it possible to not just produce anything effectively but discover new physical products faster, without the pathologies of American financialization. Another is provincial competition with duplicate companies and “involution”, spurred on by national plans like MIC 2025. Not even Xi likes involution, but they seem to be unwilling to tackle it, because it also produces very fit companies. Overall, I think that in the long run this strategy works fine as it makes goods cheaper very quickly at the cost of slower growth in nominal consumption.
Well, it's fueling Chinese pharma companies too, and now they're licensing miraculous drugs to you, and you buy the end product at 30-fold markups. “In China, a single-dose vial costs US$280 but in the US it will have a wholesale price of US$8,892”. Though the US distributor, Coherus, classified as a manufacturer, captures 80% of this markup, on merit of its role in dealing with the FDA. Who knows where we'd be if the Chinese could rip you off directly. Maybe all cancer would've been solved already, and your healthcare would've been cheaper too.
Maybe but that's a quantitative question, I think rent+health+education are uniquely Baumoled in the US relative to China (which subsidizes them), constitute non-optional spending, and cover a large fraction of the gap. The accounting of US consumption is pretty different from Chinese approach too, as @FrankishKnight explains here. Anyway, as I've said, low Chinese household consumption is not more anomalous than high American one. Nations have all kinds of ratios, and the US ratio is not characteristic of a prosperous state.
Those are worth peanuts in comparison to their current trade volume and surplus. They'll be fine, at least it won't be their biggest problem. If the world stops buying their ships, they also won't need quite so much iron.
This is a pretty common theory in Finland. After some Googling I found a translation of a book attempting to deboonk it, though I haven't read it myself.
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Trump is indeed importantly bad. It's important for me to lay out why I think Trump is bad because, as you know because you keep deploying "what about what trump is doing" as counters to my arguments, much of what makes him bad is that he's doing things China has been doing for a while now. And you also use his stance on chips as a major line of support for your triumphalism of Chinese chip production. Our models of him diverge on this subject in ways that are important to the discussion.
There's some nuance I could edge at here, China itself runs deficits both at the national level and massively at the local government levels so this is hardly just a problem for the US. But I don't fundamentally disagree that the debt spending is unsustainable and should be curbed. My point was that Trump is not doing this, his "vision" does not include doing this and he makes even less convincing noises about doing it than previous administrations that did not do it either even if he sometimes burbles up some incoherent thoughts about how the tariffs will pay down the debt right before promising to instead give that money out in checks.
Well no, there are other options. If we behaved like China then we would deploy state espionage to steal their trade secrets, establish national champions to feed those trade secrets to and subsidize those champions while pushing our other industries to favorably use them. There is an important difference in how the two nations behave when they rely on an outside actor in their supply chain, this is core to the question of autarky.
In the earlier post you quoted I gave you three levels of AI plateauing that seem extremely plausible to me, although the first and third seem like more likely states if I'm honest. The fact that the middle level erased much of China's biggest advantage in number of engineers was more of a side point than the whole thrust of my argument but you seem really fixated on that possibility. You've thought about that potential world more than I did and found some interesting features of it that I thank you for sharing. It really is a world worth thinking about. But I don't think it's the more likely world.
Yes, it is bad that we've been dominated by the boomers for so long and have elected so many elderly candidates in the past decade or so. Fortunately we'll have an opportunity to correct this in a few years, when will China's next chance to relatively smoothly change its leader be? Can some other entity make the call to push him out without fear of retaliation if he declines but refuses to accept it? These are civilizationally important questions.
I suppose it depends on how you define good news whether zero covid being possible was the good news or was it bad news that stoked his paranoia that he favored. The point is isolation from alternative viewpoints that he himself doesn't actively seek out.
And maybe another of his biases is this belief in the importance of autarky. As you go on to say he espoused autarkic rhetoric of the importance to have no "choke points" and that desire was processed by the state media apparatus into a report about where those "choke points" are and then the state apparatus set about alleviating them and succeeded in that goal, well it succeeded in it as far as that very same state apparatuses measurements are concerned. But this is all downstream of his view that it's very important to be entirely self sufficient and autarkic. That isn't a fact of the universe, it's a bias in Xi's head that the state apparatus confirmed and attempted to address. Other nations do not attempt to be free of any foreign dependencies and it's not a costless goal to pursue.
Maybe further economic independence is a good thing, maybe it's not, but either way China will pursue it because it's what Xi thinks is right and it would pursue it into ruin if that's where it leads. I doubt the autarky demand will lead China to doom, but there are policies and biases that could. Maybe Xi gets a militant edge and goes after Taiwan too early or too late or gets it too easily and then pushes too far for other islands. There's a lot running on one guy who may live another twenty years but for how much longer will he remain as sharp as he was in 2020? senility sure hit Biden pretty fast.
I am indeed very thankful that both of our out of touch leader's terrible decisions cancel out.
You're telling me refusing China State of the Art chips might get more of the most talented researchers to come to the US and this somehow forms itself into an argument to send them the chips because as a second order effect the talent remaining there will demand to use our chips? I think the first order effect swamps here and is an incredibly good argument for not sending them our chips. I think a job offer at our frontier labs should in fact come with a free golden Trump citizenship card stapled to an H200.
Turning off export controls to prolong export controls is a little too big brained for me. I could grant some small, measured in weeks to months, "lock in" effect for releasing export controls if that's what you want to call Chinese chip makers getting slightly less feedback from the frontier labs. But at the cost of our largest advantage in the race this is silly.
With the benefit of a new night's sleep and a reread through this thread I think we can cease the back and forth on this topic, Trump era American international trade policy is so bad that it has become as nakedly extractive as Chinese international trade practices have been for decades. Going back and forth on examples is not productive. It seems we agree that nations today will act in their economic self interest. My point is that America has an economic self interest in using its trade policy to remain ahead in AI and we discuss this elsewhere.
These are American brains. We claim those. It's one of our things. Homogenous nations get an easier time remaining high trust and unified, us mutt nations get to claim all the output done in our name, that's only fair.
Looking at Samsung printed on the back of my phone "Are you Chinese?". I dispute this dichotomy.
Well yeah, that's the very expensive part. We can argue, and I largely agree, that the FDA should have lower standards; but providing proof that a drug is safe and effective to a very high standard is not pure rent seeking. There's genuine economic value there that the rest of the world often freeloads on, even if rationally we might prefer a lower but less expensive standard.
Sure, we can quibble around on the accounting, but China's household consumption as a percent of GDP isn't just low compared to the US, it's low compared to basically all developed economies. The EU runs around 52% without the US healthcare peculiarities.
But more importantly you haven't addressed the demand problem. Chinese industrial capacity is built to and relies on exporting to function. It's not an accounting artifact. It's clear in the trade surplus and it's been a priority to fix for over a decade now with little to no progress. If trading partners want to behave like China and cut their imports then this whole system falls apart. The companies reliant on exports fail systematically. The savings of the Chinese citizen dry up. The debt of the local governments turns acidic and the whole thing seizes. Economies are complex systems, it's not enough to be obsessed with minimizing the inputs, you need to ensure the outputs work too.
I know you're skeptical of the importance of demand. Maybe this will make more sense if we swap the sides. Why were American businesses so willing to risk such high demands to gain access to the Chinese internal market? More demand is good right? It's good for companies when they find lots of new customers? What happens to a company if it suddenly loses 90% of its customers? What happens to a country if all of its companies suddenly lose 90% of their customers? From a god's eye naive view you might look down at this country and say "what's the big deal? There are lots of people in that country that could use new cars or widgets, this seems like a win, we don't have to send the cars and widgets to foreigners, just give those people the products. But those products were produced with debt on the assumption of payment that the country's people can't provide. The production was all forward shifted before the payment and now the payment isn't coming.
Well wait, this is a bit of a dodge. Are these other nations not getting access to the labor erasers?
This bulverism is beneath you and something you seem to always return to. These beliefs are neither in my heart nor on my lips. So frequently you accuse interlocutors of believing in vile orcs or subhuman bugmen. Give me a break man.
There is, of course, a difference between sovereign debt, which China has (though the ratio to GDP is exaggerated, because GDP is underrated), and external debt, which in China's case is minuscule. But okay.
You are indeed pondering the use of fairly underhanded means, except you don't need to steal «secrets» because most of that is your own IP, the main problem is skills. I think the gap is near entirely due to stronger US position in established technology (real and, even more so, arrogantly perceived), not any moral preference.
I'm really not, I'm talking about third parties, mainly the EU, but extremely high levels of automation on some timeline <20 years seem to be the modal scenario for me.
When Xi grows tired and steps down, like Deng did (Deng, importantly, kept manipulating his successors). Personally I think he'll nominate Ding Xuexiang on merit of overseeing the EUV project, assuming that it succeeds. Ding doesn't have the required track record of governance, but Xi broke rules himself, and this is more important than boosting KPIs in some province.
I think the good news was about the technical possibility of zero Covid, or at least drastic slowdown of the spread with full lockdown and tracking measures. The bad «news» was overestimation of potential costs of Covid, and once we reached Omicron, it took too long for Xi to notice both failure and good news of Omicron's relative mildness.
I think you're failing to model him. This boilerplate grasping autocrat theory is about as lazy as your theory of Huang, too. More generally I guess you're biased against and uncharitable towards «rulers», both CEOs and personalist dictators, they must be irrational, petty, and shooting themselves in the foot. Because otherwise it's not clear if «uh, but we'll stop electing boomers one day» suffices as a defense of a structurally compromised, easily corruptible universal suffrage 2-party democracy. I seriously believe that your succession system is straight up inferior to the CPC's one, both morally and technically. You impose no filter besides "graduated from a good school", you ask for no virtues except popularity and political instinct, your checks and balances and «institutions» are revealed to be hot air, you reward clientelism, and so on it goes. It's a very good system for ensuring non-violent successions and popular buy-in, but that's all it has going for it – insurance for elites who want to play the game of power without skin in the game. It's a complete profanation of the idea of democracy, which was designed for a different people, of different class, in a different context. Chinese system was at least designed for modern-ish China.
Other nations can't, at least not yet. Only China and the US have a serious shot. It's a very valuable goal when you have a powerful enemy that wants you to be technologically behind and vulnerable to trade disruptions because it considers your self-directed development morally wrong, or inherently a threat.
I tire of this debate about autarky. It's a somewhat recent discovery for the Western public that China is doing that, overwhelmingly the complaints were about gross trade imbalance, IP theft, «military applications» and sectoral competition, you're one of the few who's talking about autarky as a problematic philosophical position. Though notably, Neal Stephenson predicted this dynamics in Diamond Age, see Seed vs Feed (no relation to Sneed).
No, that's not the argument. I'm just listing their options. On the margins, yes, total compute denial might drain some more brains. I think that your bias is preventing you from noticing that they're not desperate like Indians, they're already pretty nationalist, and such blatantly hostile effort may backfire. I know that some OpenAI folks proposed stalling Chinese AGI project by granting O1s to top DeepSeek researchers, who privately said they are not interested in this garbage (several of them are returnees, and I guarantee you that they can easily 5x their income anytime by switching sides again).
Your society is just increasingly losing attractiveness. There are costs to vice, to dysfunction, to casual racism, to smug forgiveness of your every demerit, and to antagonism. There are also costs to having low sexual market value, frankly. How much is it worth in $$$ or H200s for a 20 year old nerd with 3400 CodeForces ranking to justify living in a place where you get Chinese women, rather than in Hangzhou? I think this detail is often underrated in analyzing people's choices.
Anyway, the argument was more about the difference between freely working on the best hardware they can get, and working in a shitty Soviet-style sharashka with a commissar. If the latter is implemented, the US does win on freedoms, values etc. Xi does not want to fold frontier private companies into a SOE and destroy them, in AI and otherwise. So he's navigating a fine line here in permitting Nvidia with caveats.
This may seem naive and romantic to you, but that's my view. They are invested in their research projects, their companies, their mission, their nation, these companies are currently culturally healthier than American ones. You can't change that with some bans, but Xi can, and he has to weigh the costs.
my 95% interval is 1 to 5 years. You really overrate how plug and play it is. It's comparable to the problem of chips as such. They were designing chips on par with Nvidia back in 2019, they still don't have an equivalent to CUDA. In 2026 they'll tape out chips on par with Nvidia from 2022, and still won't have an equivalent to CUDA. I'll change my mind if I see any non-garbage model trained on Ascends, there's definitely more than enough raw compute for that already. Last time Huawei tried, it was an obfuscated DeepSeek V3 with a switched tokenizer.
Well, that's the spirit. But there's a difference between being a heroic man at home and a brainy bugman in a foreign land. You've got to offer better deals if you want to keep them, because some top performers are going back. This guy, for example. New top performers are often skipping the US stage altogether. I see 5 IOI Gold winners on DeepSeek team. Graduated PKU and went straight for <$200K compensations at home. I think Zuck would be eager to pay multiples of that.
That's a fair concern, and yes of course the Party shares it. I don't think it's an existential concern, because thermodynamics is more important than financial flows. If you really can produce everything cheaply in terms of energy and labor, you can lose 90% of your trade surplus and pivot to subsidizing demand, it'll be a politically costly but technologically straightforward adjustment, and yes you can survive an implosion of your companies. If you cannot produce much of anything cheaply, you can try to subsidize supply but you'll probably be flailing for years. And speaking of debt, you can do the arithmetic here. Even their most involuted industries are not in such a gutter.
China cannot fully implement Dual Circulation. That's largely a failure. That's also largely a product of tradeoffs that make sense under their assumptions about long term competitiveness and security, which I believe are not paranoid and in fact more rational than American assumptions were and are. Too many of their exported goods cannot be replaced in the short term, so they can currently afford this model. Notice, for instance, how they've shrugged off the decline of exports to the US market, fully offsetting it with Asia. The developing world has much need of cheap high quality goods, particularly capital goods, and will have for a while yet.
Going forward, we'll see.
Are they? My impression is that the US intends to monopolize the top-tier product for national security purposes. They'll get open source Chinese versions or some nerfed American stuff.
But that's my idea of how your AGI race narrative would actually develop. Personally I think that everyone gets their sovereign AGI, sooner or later, so we'll indeed see a large reduction in non-commodities trade, shoring up of critical industries, and have to live with that.
I believe in individual responsibility for shared delusions, and I do think that your analysis is strongly influenced by an implicit belief in racial hierarchy, which is why you are not curious to learn more than tropes and some macroecon about this system your nation is in competition with. But fine, I won't insist.
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Any theories, here? Does every country decide to just sit back, possibly import raw commodities and energy that aren't otherwise attainable, and live in blissful abundance?
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Here's another article to add to your arsenal and broadly echoes what you're saying: China is making trade impossible
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Huh? Isn't that the supposedly pea-brained Austrian Economist take? Why are neolibs copying other people's homework now?
It’s a mercantilist take; as far as I know, the Austrian school has nothing against trade deficits and indeed would support even unilateral free trade.
Kinda. Yes, Austrians are in favor of free trade, and tend to say deficits are just a natural part of trade, but they're quick to note that this is only the case under something like a gold standard, which has built-in balancing mechanisms, and that under fiat you can have perpetual deficits, which aren't good for you in the long run. Peter Schiff in particular had entire hours of rants about how the US is printing IOUs to buy consumer goods from Asia. The sentence I quoted from Noah Smith is literally indistinguishable from the kind of stuff he used to say (and probably still is).
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When you're trading with an actor with ulterior motives free trade assumptions break down, even neoliberals know that you ought not actually sell the rope that will be used to hang you.
Depending on how you define “neoliberal”, not necessarily! As always the devil is in the details—I’m sure some self-described neoliberals would advocate for a measure of protectionism in industries relevant to defense and national security, for instance—but one plausible neoliberal response to a foreign country engaging in so-called anti-competitive trade practices (e.g. dumping) would be “Keep the goods flowing; why should we say no to their foreign aid?”
This is of course always the rub.
I think this is best described as just the classical naive econ model. As far as models go this is at the very least middling, with most popular variations from it being the result of poorly thought out motivated reasoning for doing things that people want to do for other reasons. Still, one should not rely on game theory to keep the scorpion from jabbing you to death or however that fable goes.
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And I know the obvious critique. If America can't compete in semi-conductors on a level playing field or any other industry then they should lose and China should make these things cheap as the pie growing move. But this isn't a level playing field. No one does more industrial policy than China. The CCP has an autarkic goal and pursues it at the cost of many things.
They systemically suppress domestic consumption through keeping deposit rates so that households earn below inflation returns so that those savings can be pumped into industrial buildout. The Hukou system creates workforces with limited rights in their migratory cities suppressing their wages to reduce labor costs. They spend very little on social safety nets. the end result being that Chinese household consumption is something like 40% of gdp vs 65% in the states.
You can say that's just them running their economy lean and that decadent westerners should lean down their consumption to compete, but if they did then you really would run into an environment where demand is too scarce. I know you've mocked that idea in the past but it really would be a problem for industrial buildout if no one was buying the stuff China or everyone else was producing.
I simply don't think this is even true, it's more self-serving imperial propaganda to present failures as a moral choice. Most of your consumption value is rent-seeking like high rents. Chinese consumption is not that low, read this. Even Chinese safety net is not as low as is often said, it's on par with other middle-income nations.
You're not doing anyone a favor by being corrupt.
It's paywalled. What does PPP have to do with the fraction of Chinese household income that goes to consumption?
Because those are the same issue.
In effect, if Chinese services consumed by the people provide 5-20 times more value than PPP calculations suggest, this straightforwardly means that Chinese people's "consumption" share of GDP is higher, because the volume of economic activity included in these services is larger relative to exports and government spending than it appears. We can directly estimate the value of their exports. The efficiency of their services and internally consumed goods is more opaque, so it's easy to say “oh just 2000 RMB, that's $285, adjust for PPP… $428”. It actually matters if it's more like $3000.
This feels like a misdirection. The price level of China vs the US doesn't matter for the question of how much of Chinese GDP is household consumption. In each case the ratio can be calculated in local currency without any need for PPP adjustments.
The article you linked is (apparently, based on your excerpts) discussing correct PPP factors based on household expenditures, which is really not the same question at all.
Put another way, my argument is that household consumption as % of GDP is low because a great volume of capital has been invested in making life cheap, in particular rent, healthcare, connectivity and education, via infrastructure and assorted social transfers-in-mind. The fraction of GDP that is “government spending” or “employer spending” goes towards increasing purchasing power of the average (and below-average) Chinese. Consider:
etc.
This is a separate strategy from either low-intervention market economy or “welfare socialism” with explicit gibs that boost discretionary spending. It can be criticized but it's internally coherent and it's not just “make people poor to have cheap labor to flood global markets”.
Sure, let's throw that in to the consumption number.
That brings us to 46% for China and 65% for the US based on the numbers above, once we apply the increase from the text you quoted. Still, the gap is fairly significant.
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Is this how you do all your argumentation?
No, as you can see mainly I rely on other means. But this Baumol-diseased "consumption" that Americans pride themselves on is indeed largely propaganda.
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One of the unique realities of both British and American imperialism is that Empire was and is not central to the national identity of either people.
British Imperial identity was, as many historians have relatively well argued, invented wholesale in the last thirty years of Empire. In fact, the greatest and only real grand celebrations of Empire occurred between 1918 and the Second World War, when Britain’s relative global power had been in decline for more than fifty years. At the true height of Empire in the mid-19th century, identity was more English than Imperial, and international competition was more focused on the French than anyone else (even as the opium wars raged, as the scramble for Africa slowly began, as British money surged into South and Central America, as settlement in Australia grew rapidly etc etc etc). Pomp and ceremony in the colonies, even India, was very limited until the 1920s.
Similarly, in America, most American identity has nothing to do with America’s global power or prestige. America is much larger and more geographically diverse than England, unlike that country it doesn’t really even need to trade with its regional peers. Unlike those final days of the British Empire, most American media doesn’t really reference American imperialism. Most stories are set solely domestically, while even most international ones treat the rest of the world the way a pre-imperial American might have a century and a half ago, with a certain distance, a foreignness from petty domestic conflict (see Indiana Jones versus James Bond, for example). Most Americans have no major opinions on foreign policy.
America is often called a reluctant hegemon. I disagree, it’s an incidental one. The empire is not important to the American psyche, to American identity. I won’t comment on the Russian or Soviet empires, but I get the feeling they may have meant more to their inhabitants, at least some of them, than the American Empire does. In part, this is reflected in the fact that even most Americans consider the wars in which America participates done either for moral reasons or self-interested ones. Economists say that American hegemony makes the world safe for profitable American companies, but most of these still make the vast majority of their revenue in-country. I think, on balance, this is like an Englishman in 1910 extolling the virtuous export of Britannic Civilisation, namely a very nice just-so story to explain how things came to be so.
This is true even for more politically aware, heterodox thinkers. People will say America goes to war for powerful banana companies, for oil, for revenge, because of the Jews, because of some leader’s personal grudge. An earnest interest in world domination and American political hegemony is considered laughable, even if it’s mentioned in a PNAC leaflet everybody treats it as a ruse. Nobody believes in it. “America’s mission is to export liberal democracy to the world”. No, I don’t think even Hillary Clinton believes that.
But America can cope spiritually with the collapse of its global power better than most other historical empires for one reason. Because an invasion of the homeland is so unlikely, and because the domestic market is so large, and because they have so many resources, Americans can simply stop caring about the outside world if the news gets worse.
It’s the rest of the world that will be less lucky, and which will experience radically more upheaval. The Chinese will need to solidify their offer for new vassal nations though, because currently it isn’t particularly compelling, and they have a quality around them that seems to make a lot of enemies, which means their hegemony might be resisted more than the present arrangement.
Our homeland, Europe has been invaded.
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To what extent is there a British non-imperial identity though? I doubt one can divorce Britishness from the project of colonialism.
The Empire never came up in my schooling or childhood at all. Part of that was tact, of course, but it was also because the formative events of British identity are broadly:
Not only was the Empire not really considered important, but neither were Napoleon, America or the Industrial Revolution. They were just stuff that happened.
Hold up. I'd argue the first four of those are formative events of English identity. British identity is something the English, Scots, Welsh and Ulster Scots can all share. And my argument is that whatever that is, it cannot be decoupled from the project that British imperialism. What else did those peoples ever do together after all?
Bugger all, but realistically I think that when people say ‘British’ what they mean is ‘English’ or at most 80% English and 20% Scottish. From the sheer proportions of population it really couldn’t be any other way.
There was a conscious attempt to make a British identity during the period of Empire but that died with Empire. The Scots and Irish hate it because it associates them with the Empire (as it ought) and nobody ever asks what the poor Welsh think about anything.
Basically the only people who use British are the English and the English-adjacent people like @2rafa, because talking about an ‘English’ identity or discussing Englishness is consciously exclusionary and raises awkward questions about how the vastly more populous part of the UK should act with the others. This is also why England is the only part of the UK not to have a devolved parliament.
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Hmm, the two major things you've missed out there that I was under the impression every schoolchild in England was taught were the English Civil War, and then the naval stuff so Trafalgar and the Spanish armada. Roundheads vs. Cavaliers featured very heavily in my education at least. Trafalgar also featured heavily as part of the post-WW2 vision of plucky old England against the tyrant of the continent. The rest of the Napoleonic wars barely featured, but Trafalgar and to an extent Waterloo definitely did.
I knew of both but was never educated on them. My education was during Blair’s tenure and lopsided towards modern (post 1900) history: heavy emphasis on the welfare state and the suffragette movement, plus the rise of Hitler and Stalin to power.
Perhaps Brown and Cameron re-emphasised the Civil War in the curriculum. I'll admit though that after the age of 14 "history" seemed to entirely consist of the 30 year span between 1914 and 1945.
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You should wait to post this until it actually happens. China might get nearly equivalent chips in bulk by mid 2026, but it's a tough problem and things could easily go wrong. Doing a victory lap based on industry rumors is premature. This reminds me of the perennial Wunderwaffe posts we get from pro-Russian accounts on here, where this new missile or drone is just totally going to swamp Ukraine and this whole slow warfare will turn into a blitzkrieg. And then... that doesn't happen.
Alternative explanation: Jensen Huang won the game of "be the last person to talk to Trump", since he knows Trump is a waffling buffoon and Huang just wants to maximize Nvidia's stock, US security concerns be damned. Then on the Chinese side, the CCP doesn't really care about this CUDA vs CANN stuff nearly as much as it cares about its industrial policy of "make EVERYTHING in China", and a wave of Nvidia chips could disrupt that beyond concerns about ecosystems.
Oh good heavens. No, you don't have to be a traumatized, angry denialist to understand that maybe it's a bad thing for the US to give an extremely bottlenecked resource to its main geopolitical rival.
That's a funny perspective to me. Russians have negligible industrial base, atrophied Soviet military-industrial complex, and mainly export stuff like oil, gas, grain and fertilizers. We also simply don't have many smart people remaining, and instead have a population of jingoistic TV-watching cattle that needs steady supply of copium in the face of a protracted war that's going badly. Of course we have televised fantasies about Wunderwaffes. The US is, for all its grandeur, similarly a corrupt Soy and Gas Empire that struggles with building physical things relative to its consumption and ambition, we see whining about the Rust Belt, Powerpoints with 6th gen fighter jets and «Trump class battleships», and the whole AGI project is supposed to restore the claim to primacy. And even in Ukraine, Americans heroically grappled with the costs of exporting this or that long range wundermissile or Smart Shell, and thought that their Wunderwaffes like HIMARS, or Palmer Luckey's gadgets, will make more of a difference than commodity drone parts from Aliexpress procured by both sides. They did not.
China is the factory of the world and the source of almost all new process innovation and, say, the bulk of Californian top patent holders. The Chinese are not advertising their ion implantation techniques, procurement plans, fabs, they are quietly doing business and actively avoid international publicity on these matters. No, I don't think this is a Wunderwaffe. Yes, we'll see what they can actually produce in 2026.
This is still denialism of the erosion of fundamentals, I think. Classic stabbed-in-the-back-by-Jews [of Asia] doctrine. Huang founded Nvidia over 30 years ago, I don't believe he's a petty merchant optimizing for quarterly reports.
Good grief x2.
The goal of the CEO of any American company is implicitly if not explicitly the maximization of shareholder value. Selling chips to China is just how Jensen Huang can achieve that better. The idea that Huang is doing it as some grand geopolitical play (and where his company's bottom line is a secondary concern) is a bit hard to take seriously. Like, he might be doing that, but you'd want to have a decent amount of evidence to convince people that it's not just the cynical moneygrubbing play.
No, we do not need allusions to Nazi conspiracies of the Jews to say "the CEO is probably just trying to make more profit".
You're so confident. On what time horizon? One quarter? One year? Decades? As long as the company gets to exist? Do you realize that Jensen is a founder, and founders are not equal to board-appointed CEOs?
If the only way you can think of this is myopic mercantilism, then you are indeed culturally and civilizationally inferior to the Chinese and deserve to lose, get dunked on and consigned to the dustbin of history. You're inferior people, xiaoren. The Teacher had said:
Get bent already.
…But I think people like Jensen and Elon — tellingly, not Americans, but those who have adopted the nobler American ideal — are different. Jensen says:
I don't think Jensen wants to sell out to China to make line go up. He wants to keep playing the infinite game.
But inferior men can only interpret a superior man's vision in terms of profit.
Be less antagonistic. You write a lot of AAQCs, but you also have a real problem with not being a dick when arguing with people you want to talk down to. You are not a put-upon genius forced to interact with fools. Stop acting like you are.
If I have a problem, it's with exasperated, condescending and low-effort dismissals of good faith arguments, with eyerolls, smirks, chuckles and other juvenile garbage.
What the fuck is the appropriate response to this?
If you think something is not worth responding to, don't respond.
Everyone who responds by being antagonistic says (and believes) that they were provoked. You are still responsible for your response.
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I still don't understand how exporting chips to China is supposed to help the US in the long run when the Chinese long run plan is to not import chips.
How is it not supposed to help? Money is good, market share is good. It reduces US trade deficit, providing funds for more useful things. Just 1 million chips is $25B, it's equal to the annual worth of those soy exports Trump frets so much about, it's like 5 times more than the much-hyped LNG boom. It derisks the circular investment bubble with NVidia as the nexus that's now a large part of US economy, and extends the timeline on which China stops importing them (ie the moment where domestic computing platforms are adopted by their top labs and shutting Nvidia out is not disruptive to DeepSeek V5 or Doubao-Seed 3 or whatever).
In a more relaxed geopolitical environment, they may not even stop 100%, just like they're still buying high-end Western CNC machines, despite being able to make functionally similar ones now. Nvidia will still have better yields, lower unit prices, higher power efficiency, more polished software, likely for decades. It's not like they have a philosophical commitment to not buy at all, they are simply focused on becoming strategically invulnerable to export controls after years of American gloating about how they'll fall behind and die, starting with Huawei.
The main argument against this has nothing to do with Chinese plans to stop buying chips later, it's just that they'll develop and deploy stronger AI at larger scale and secure some advantages in the short term, in the limit literally ASI. An auxiliary argument is that they will use extra compute to speed up the necessary research. That can be debated and weighed against standard economic arguments.
We were just discussing long vs short term thinking. Money and market share are the short term returns, the question is about the long term.
We're not in a more relaxed geopolitical environment. We're in an environment where China is doing everything it can to stimulate domestic chip production including by banning imports of certain chips in the first place, which sounds like a philosophical commitment to not buying at all to me.
If you believe that China is interested in being invulnerable to export controls and you believe that Nvidia use can lead to lock-in, it follows that China's strategy would be to avoid the lock-in in the first place, which means that there is no long term market for Nvidia chips in China.
Correct. I brought up the other argument in a previous thread where you responded with a non-sequitur about orange man having bad trade policy. Here I'm limiting myself strictly to your claim that chip exports would be beneficial in the long run for Nvidia.
I have the exact opposite view on this. Market share is the long term play – maybe 30 years. Your “long term” AGI supremacy play is a no-term Hail Mary premised on some dubious assumptions and, frankly, low IQ racism about Chinese capacity for independent R&D.
It's a philosophical commitment to independence. They enact protectionist measures for fledgling industries, and scale them down after achieving competitiveness, like they cut subsidies for EVs or batteries.
As I've repeatedly said, current Chinese AI software has low adoption, especially by talented collectives, and thus low development velocity; so long as it doesn't get adoption it doesn't matter if they can physically make good chips, they'll remain vulnerable to export controls and will have to do another multi-year moonshot after the next Democrat opportunistically cuts them off. H20 and RTX Pro 6000D are just not providing enough value to justify further software stagnation (not to mention reduced revenues to domestic manufacturers). H200, because it is both a powerful GPU and scales to large training clusters, seems to be marginally valuable enough so we see more nuanced regulation. After domestic chips become better than H200 (or rather, domestic systems + power subsidy become competitive with Nvidia clusters) and there's wide adoption of Huawei CANN and Cambricon NeuWare, I predict that they will relax controls on imported chips, maybe replacing it with a simple tariff. Your model suggests that they will tighten controls. It's an empirical matter, we will see in a matter of 2 years, most likely.
As explained above, it does not follow and you're refusing to understand what they're doing.
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Jensen speaking here is mostly just CEO boilerplate. Obviously they'll say "oh yeah, we're in for the long haul", but that's not much in the way of evidence. I'll grant that founders have a bit more of a tendency towards pie-in-the-sky goals like 20 year plans and maybe geopolitical stuff, but Huang is still subject to the whims of shareholders. He doesn't even have extra insulation like Zuckerberg with a screwy voting shares system. And Elon makes plenty of boneheaded short-term decisions.
Can you stop it with this nonsense please?
Can you stop with this nonsense please? He founded Nvidia, he navigated it strategically through every industry transition, proactively shaping them, he made a gamer hardware shop into the most valuable company on Earth and the kingmaker in the AGI race, he clearly intends to keep it in the running through all future transitions, and he understands Chinese competition very well. He knows that they're in a tough spot and Mellanox is not an adequate counter to Huawei's networking. He's trying to save not just his company but your asses, because he's existentially invested in them.
When he says that he's playing an infinite game rather than just chasing a quick buck that'd leave his headquarters irrelevant in under 20 years, this deserves infinitely more faith than your jaded dismissals of “CEO boilerplate”. You need to acknowledge that your standards of judgement and your theory of incentives are only fit for business done by inferior men. People are not created equal, opinions of people are not of equal worth, Jensen's opinion >>>>> median American's opinion.
Oh the high and mighty. The dude ran a company making hardware for gamers and crypto miners and got lucky that it ended up being civilizational important and that they bet on EUV big. He is by all measures obviously an excellent business man, impressively ahead of the game on this latest DRAM shortage. But none of that is evidence of some kind of long term view. Spare us the Ubermench talk, I thought we were supposed to be the nazis in decline.
It's impressive how you can make a $4.6T business in the US just being a lucky huckster, huh. Just like you can dance into becoming the president of a superpower while being a bumbling TV personality, rather than claw your way up over decades, starting from the flea-infested cave in Shaanxi. Blessed land, Manifest Destiny, a people chosen by Providence itself. I guess any mediocrity ought to feel invested in protecting it, then. Where else do you play and win in such lotteries.
But I don't share this theory. I don't think the US allows you to play on God Mode, and I think Jensen is not just an excellent businessman, and certainly not a “treasonous worm”. He is an industrial titan like Rockefeller or Carnegie, he genuinely has a long-term vision, and he demonstrably executes on it. America was made great by such men, and if it declines, it will be over forgetting their value.
Nazis were wrong about innate racial superiority. Most people are mediocre, whether Aryan or not. This doesn't mean that Nietzsche or Confucius were wrong about the existence of specific superior individuals.
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Umm... it is the Ukrainan side that relies on wunderwaffes - like the mythical flamingos - that are dirt cheap, produced at large scale and supiciously missing on the battlefield. I don't think someone here has praised russian weaponry. What they have is cheap-ish stuff produced in masse. The pro-ru people here generally underestimate the ability of ukraine to kinda hold together.
If Britain and Argentina are two bald men fighting over a comb, then Russia and Ukraine are two butch lesbians fighting over a condom.
I don't think the situations are comparable here. For Britain, beating up Argentina and keeping whatever they kept, nobody cares by now what it is anyway, was pointless and meaningless. Britain is not an Empire anymore and has no desire or capability of being one. Heck, they aren't sure they want to be Britain anymore - displaying a national flag is officially deemed to be an offense.
For Russia, however, at least in the concept Putin sees the future of Russia, conquering Ukraine is an absolutely key part. You can not have a Russian Empire without having it's historical core - the three Russias, Great, Small and White. While Belorussia is formally independent, Putin has enough control over it to consider it his. The control of Malorossia is absolutely vital, without it the whole project of recovering the past glory has no sense. It doesn't have to be officially part of Russia, at least not yet, but it has to be under the Moscow heel, otherwise you just can't pretend you are doing anything to recover Russian Empire. Within this concept, the war makes total sense for Russia. So comparing it to British-Argentinian war is not proper, it's very different. It may be meaningless for the US, as a tiny Russian Empire - at least for now - changes little to the US for now - but it is very meaningful for both Russia and Ukraine.
Another important difference is that Britain could kick Argentinian ass very easily, whereas Russia has navigated itself into an existential war. I think on the balance Falklands war made more sense for the respective Empire.
On one hand, you are right, that Russia got in deeper than they planned to. On the other hand, I don't think Putin minds too much - the expenses of the war are quite tolerable so far, the final power consolidation, which otherwise may or may not have been smooth, went without a hitch, he got rid of pretty much all opposition and a lot on undesirables, and has a mandate to do pretty much anything he wants without any internal opposition. He can maintain it like this for many years. Maybe taking over Donbass will take another three years instead of original three days, who cares? These three years he is an unquestioned war leader, whose victorious army is conquering enemy lands. The economy has not collapsed, the people are not starving. No significant riots or disturbances. As Russian rulers go, it's not a bad showing at all. So I don't think they have a reason to see it as any problem right now.
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The Falkland Islands, and Argentina very much still cares.
OK, I stand corrected, nobody but Argentina (which I am sure prefers Malvinas) cares.
Indeed they do prefer Malvinas. I suppose the 3700 people on the Falklands care too, though the half-million sheep and million penguins likely do not.
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Time for a new flair, methinks.
Of course, my anime waifu that exists only to flatter me.
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