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Samizdata quote of the day – Is China communist? Now the thing is:
You can gatekeep in Europe
You can gatekeep in the United States
You can gatekeep in every single economy of the West
But you absolutely cannot gatekeep in China, for there are no tools at all, that would allow you to do that
Like what would you even do to restrict the new entrees?
Intellectual property? lmao
Some other lawfare? Again, just like the enforcement of intellectual property rights, that would ultimately rely upon the cooperation of state, and the state in China – unlike in the West – just would not cooperate.
High profit margins in the West are ultimately based upon the artificial restraints upon the new entrees, and upon the state-sponsored gatekeeping. You keep your prices high, because any new entree on the market will be scared away by the force of the state machine. And in China, the state machine just wouldn’t do that. That is why Chinese competition is getting so close to perfect, and that is why prices (and profits margins) in China, can be getting so low.
– Kamil Galeev
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The Wild West is also a Platonic Ideal. Never thought it would take hold in China, though.
I find myself both agreeing and disagreeing with this article. I agree that in comparing the western “free market” economies we dramatically underestimate just how much that pile of regulatory burden, rent seeking, “government contracting”, politician buying and intellectual property reduces the amount of competition, and consequently the market is very far from free.
A while back some company had some government sponsored restriction on the manufacture of epi-pens (it wasn’t a patent, but something similar, regulatory probably, but I don’t remember). And started selling them for $700. An epi-pen is an extremely simple device, a spring loaded syringe with ten cents of epinephrine. It should be for sale in Wal-Mart for $5.99 or $8.99 for two. So, when that happened why didn’t I jump on board and start making one myself and selling it at huge profit for $50? I definitely have the skills and could have raised the capital. I didn’t because the government wouldn’t allow me. If had done, I would have gone to jail. So much for the free market.
But on the other side I think the OP is a bit too rosy eyed about the Chinese. They are very far from having perfect competition. The Chinese government most certainly does interfere in the market, whether by making the whole market place part of their spying network or forbidding the production of goods and services that they do not approve of. And in fact a lot of the success of China comes from the government manipulation of the market. To give a simple example, the creation of Shenzhen, right next to Hong Kong. Which has grown from a small town to an industrial behemoth in fifty years. And the consequence of that is that since all the industries are collocated, and collocated by a gigantic (government constructed) port, huge manufacturing efficiencies are produced. This didn’t happen by accident, but by government design.
So I think the OP is indulging rather in the same accusation he makes of his reader of the platonic form. Economies are complicated, and are a mix of a lot of different things. Plus in China? VAST corruption. That is a huge form of black market regulatory burden on any industry.
The People’s Republic of China is not a free market – but then, as the article points out, neither are Western countries – which have vast governments, government spending (mainly on Welfare States that have undermined society) taking almost half of the economy – and the rest of the economy saturated by regulations and by FIAT MONEY and Credit Bubble banking (just as in China – which has the same corrupt monetary and financial system), which has led in the United States to the domination of the economy by BlackRock, State Street and Vanguard (which have shares in-each-other) and the Credit Bubble banks (all supported by the SLUSH FUND that the “Federal Reserve” system really is – Cantillon Effect).
Chinese manufacturing is twice that of the United States – America won World War II not because its soldiers (brave though they were) were braver than the Germans or Japanese, but because its manufacturing was vastly greater. In Ukraine that argument goes into reverse – as behind Mr Putin is CHINA (Mr Putin is a wicked fool to trust the PRC – they are not friends of the Russian people, they are USING Russia).
And the relatively capitalist economy of China (again NOT free market – but neither are Western nations – see above) is married to a vicious Communist Party Dictatorship that seeks endless conquest – lands and seas it then pretends were “always part of China”.
Mao wanted to dominate the world – but he was also a sincere socialist, and socialism is nonsense. That means his plans for world domination were a farce – as his economy did-not-work.
The present rulers of China also desire world domination – but they do not really give a toss about socialism, they care only for POWER. If private ownership of the means of production serves the purpose of making China stronger – then FINE they will go along with that, as long as the private “capitalists” serve the regime – if not they are executed (killed).
Unlimited power – at home, and around the world – that is the aim of the Communist Party rulers of the People’s Republic of China.
Power is their faith (their belief system) – they have no other.
“But China is our friend” – you utter cretin Mr Putin, the PRC is USING Russia, using the Russian people.
Perhaps he knows that (perhaps Mr Putin is not a cretin at all) – perhaps he just does-not-care that the PRC is USING Russia. USING the Russian people.
Mr Navalny argued that Mr Putin was not a fool – but, rather, was a TRAITOR, selling out not just Russian natural resources, but also the Russian people – both to the People’s Republic of China Communist Party Dictatorship, and to the forces of Islam.
As I have been saying for many years, western society is no longer capitalist, it is corporatist in tooth and claw.
I think “fascism” pretty well sums up the Chinese system of government.
It sums up the Russian system too, but Putin is more Mussolini than Hitler. His imperialistic world view is not matched by actual military competence. His invasion of Ukraine is akin to Italy’s invasion of Greece. Il Duce expected an easy win and was surprised when he did not get it. It took the Germans to defeat Greece, and Putin does not have a friend willing to do that for him. North Korean cannon fodder does not count.
To everybody above,
Totally agreed. In many ways, China’s system is modelled after Singapore’s. They studied how we utilised capitalist structures to build state power, and scaled it up on an unprecedented scale. Planning in ways that work, rather than let the free market produce sub-optimal outcomes.
If China’s fascism is out to benefit mankind, there’s no problem. But nobody believes them, especially when they keep waving that saber at Taiwan.
China’s Will to Power was going to be a problem, but their window is closing soon with their demographics.
China’s governance system rather resembles an absolutist monarchy. A monarchy is sometimes nice and successful – depends on the king. Sometimes it’s weak and anarchic. Sometimes brutal and arbitrary. And, in a monarchy, the king rarely controls everything, mostly his subjects do as they please as long as they don’t threaten his rule (if he is a wise king).
The biggest problem with monarchy is contained in the saying “we don’t want idiot kings”… there is no guarantee against it. The other common problem is that kings tend to fall prey to illusions of grandeur, and start wars, which usually lead to catastrophes.
Apart from that it is not a bad system…
Since it is out of fashion nowadays to use the term “king”… it is no longer used, but the essence is the same.
China’s Will to Power was going to be a problem,
Not sure if this is a characteristic of China, or of the current ruler.
Jacob – in a monarchy, at least one with pre-planned rules of succession, the King may be any of those things. In a system like China’s, the ruler is going to be someone who has clawed his way to the top and stamped on the fingers of those attempting to overtake him. In a democratic system, of course, the “King” (usually called President or something) is generally going to be a fast talking political fixer with few skills beyond convincing people to vote for him.
(Personally I’m not sure which is best, although in principle the random chance of honesty and competence afforded by a monarchy would seem likely to offer the best proportion of good leaders to bad.)
“North Korean cannon fodder does not count”
In more than one sense. Their lives mean nothing to their rulers, and if they are sufficiently indoctrinated, maybe not even to themselves.
“their window is closing soon with their demographics”
True, but in the short term that also creates a risk that a Chinese ruler might do something reckless, like invading Taiwan or trying to block the US Navy’s freedom of movement in the Pacific, on the basis that it’s now or never.
The Wobbly Guy:
Planning in ways that work, rather than let the free market produce sub-optimal outcomes.
——————————–
Could you give us some examples of that?
The economies of the Pacific Rim are based almost entirely on ripping/riffing off American innovations, perfecting process and manufacture.
It’s not even “Western innovations” any more – the statist economies of Europe have choked creativity. Except for a handful of companies like Nokia, the latest technology booms in Cellular/Internet/Pharm have completely skipped over Europe.
Please show me examples of central planning that spawns the technologies that create entirely new markets.
I’ll wait…
The economies of the Pacific Rim are based almost entirely on ripping/riffing off American innovations
That was true 10 years ago (for China), maybe.
Like it was true for Japan around 1960.
Times change. China is nowadays more advanced than the US in production technology and robotics and AI and probably other domains. The race is tight, and the US is losing ground, steadily.
China might yet stumble like Japan did in the 1990s, but so might the US.
JohnK
For every North Korean – there are a hundred or more Muslims in the Russian army (whether from Russia – or from the Central Asian Republics) – but the Western media does not talk about them, for obvious reasons (the “narrative” of peaceful integration in the West itself might be undermined).
And there is also endless natural resources (Russian) and manufacturing power (China) behind the war in Ukraine – this campaign is NOT going to be like Mussolini in Greece.
As for China being like Fascist Italy – it is more like National Socialist (Nazi) Germany – accept it is at least TEN TIMES the size.
Mussolini had a fetish for state owned enterprises – Hitler did not, and neither does the People’s Republic of China, it has some state owned enterprises – but it makes no fetish of them.
And Han Chinese racism (doctrine of racial supremacy) is very real.
The West has been decaying for many years – will the nearly 80 year old President Trump turn back the tide of decay, or will he prove to be another Emperor Majorian – brave (very brave), but, in the end, betrayed and dying a failure?
It may well be that the enemy – the People’s Republic of China and its “allies” (puppets) such as Putin’s Russia and the Islamic Republic of Iran – are a far more serious threat than Nazi Germany ever was.
I repeat – the People’s Republic of China alone is ten times the power that Nazi Germany was – and it has access to the vast natural resources, of Russia, Iran, and other powers to – for example due to the rigged Presidential election that installed the puppet “Lula” regime (so beloved by the cretins of the international media) – Brazil.
@BenDavid,
Planning works, as long as you have a strong enough grasp of the data, your objectives, limitations of central planning, and reality.
For example, Singapore’s Urban Renewal Authority plans our island city on a macroscale.
https://www.ura.gov.sg/Corporate/Planning/Master-Plan
China’s urban planning takes many cues from us. In many ways, these ‘regimes’, for lack of a better word, aren’t going to micromanage tech development, but they can sure as hell create technological centers with the necessary infrastructure and entice all comers. Creating the conditions for creativity, at least on the physical side.
As others might be able to explain in greater detail, these tech centers are now churning out innovations rapidly. Maybe no single innovation is truly revolutionary, but as the saying goes, quantity has a quality of its own.
@Paul,
IMO, in addition to its sheer size, China has another advantage – it has learned from the lessons of the past. It’s not going to abandon dirty tricks just because it has a whole array of advantages – no, the PRC plays not just to win, but to assert its complete dominance. That’s one reason it kept burrowing into the institutions of the US – it knows well it’s target’s weaknesses and sought to exploit them.
It’s too late for anybody to stop China’s ascent. The question is, how do we manage it?
https://mahbubani.net/america-cant-stop-chinas-rise/
Also, what’s the end goal for the PRC even if they succeed? Global domination? Okay, then what form does it take?
Maybe a China-led global order might not be so bad after all, if they can clamp down ruthlessly on extremist religious views *coughislamcough*.
My experience of Chinese Engineering and manufacturing is an exercise in frustration and incompetence. They can copy something but barely understand how because first principles are a mystery wrapped in an enigma.
The quality is, by and large, also god awful unless you watch sub-vendors like a hawk. They WILL try and scam you.
Cheaper material being substituted, forged material certificates, faked tests, on and on and on it goes.
Their economy has been slowly collapsing since COVID and accelerated by the tariffs because the majority of their manufacturing is cheap low quality crap. Their banks and businesses have debt up to the eyeballs, the populations capital is sunk into bunkum real estate scams that are slowly crumbling into dust because they were built from concrete with the structural integrity of pound cake. Vaunted electric cars regularly go *poof* in a cloud of acrid smoke and fire. Their AI is a booth babe with a microphone hidden behind a wall, and their robots like to walk into that wall or fall over and flail about like a toddler having a tantrum. Their indigenous planes fall out of the sky with alarming regularity, they still haven’t figured out how to build a working jet engine, their vaunted latest generation “stealth fighter” can carry fuel or weapons but not both and has the radar cross section of Macy’s Day Parade balloon. Their aircraft carrier self destructed in a cloud of black smoke during its shakedown cruise and its catapults do nothing but launch fighters into the sea.
JohnK
I think “fascism” pretty well sums up the Chinese system of government.
Paul Marks
As for China being like Fascist Italy – it is more like National Socialist (Nazi) Germany
These are fine distinctions when compared with the common notion that Communism (or Socialism) and Fascism are opposites.
Wessexboy – yes people who do not understand that Mussolini and Hitler were leftists have missed the basic point.
There were differences – Mussolini (the ex leading Marxist) was trying to reform Marxism to make it work in practice (Karl Marx never even explained how it was supposed to work – he denounced any questions about how it would work as “unscientific” – an excuse not to answer them), whereas Hitler was looking back to pre Marxist Collectivist thinkers – such as the German philosopher Fichte.
But, yes, both Fascism and National Socialism were Progressive Collectivism – someone who does not grasp that (who thinks that they were somehow conservative) does not know the first thing about these doctrines – and should read “The Road to Serfdom” by Hayek, and (even more) “Omnipotent Government” by Ludwig Von Mises.
BlindIo – I hope you are correct.
The Wobbly Guy – I suspect that your assessment may be closer to the truth than the line that Langley Virginia is giving us – but let us both hope that the Agency line is correct, and that you are mistaken.
Paul Marks – agree about Hayek and Von Mises, but why do so few people know this, and what can be done to fix it? I feel let down by my educators, MSM, and even the so-called right wing politicians of my seven decades. I had to slowly and diligently discover this myself, it should be common knowledge. Then I look at the utter insanity of Germany’s attempts to deal with the AfD because ‘fascism’ and despair.
UK Water companies have been in the news a lot recently and it led me to be curious to see who actually owns these ‘private’ companies.
Curious to find that 1/3 of Yorkshire Water’s parent company is owned by Singapore’s state sovereign wealth fund.A Chinese government sovereign wealth fund owns 9% of Thames Water. Was this what Margaret Thatcher had in mind when water was ‘privatised’ in 1989?
@Martin,
How did you think our sovereign wealth funds could amass more than $1.8 trillion USD? We of course sought out monopolies and rent seeking opportunities whenever we could. Short term cost, long term profit. Fascism can be very lucrative.
Personally, I’ve always thought that, yeah, great, we have all that money. But if the rest of the world goes poof for one reason or another, that money ain’t gonna buy shit.
@Paul,
I hope Langley Virginia is right too, provided they haven’t been subverted by PRC agents to provide a false rosy picture when the situation is far more dire than anybody, even Trump, suspects. Just look at how the false Trump-Russian hoax was promulgated!
A PRC dominated global order might look stable, but it certainly won’t be as benign as Pax Americana. The PRC will assert its interests whenever possible, and hold down anybody who tries otherwise. It won’t be like the US generous uplifting of other societies and countries; the PRC is out to exploit if the other party is weak, or subvert or even destroy if the other party is strong.
To the PRC, there are only slaves, subjects, or vassals, never equals.
I suspect India will face a lot more subtle sabotage, and PRC will seek to completely subvert its demographic dividend into a demographic bomb and let it implode under its own weight (India’s doing it to itself anyway). Ditto for Africa and all its natural resources.
The West will retain a certain amount of autonomy, but will have to serve deference to China’s demands when it deems necessary.
As an ethnic chinese, I keep wanting to see some glimmer of real liberalism from the PRC, but the feeling I get from them really is very reminiscent of the same tight state control here in Singapore. I’m used to it, but I know for a fact most of you will chafe under it. We certainly saw plenty of draconian policy making during the COVID era, and the PRC was especially brutal.
Sinkies bitch and moan about our tightly controlled lives all the time, but the unpleasant truth is that many people find it just too comfortable under the democratically elected fascist regime we live under. Will the PRC be as effective? Time will tell.
I don’t really blame countries like Singapore and China for doing so.
Much of the debate in places like Britain is stuck in the 1980s, as if there’s a still a very sharp distinction between private and state enterprise. Sovereign wealth funds are not private companies, but they are hardly Gosplan either. Having a foreign sovereign wealth fund own the water company (or a big share at least) isn’t a reversion to the old state run regional water boards Britain had. But it’s hardly the property owning democracy that privatisation advocates of the 1980s/90s claimed they wanted.
Wessexboyr
As you know – education, at least in Britain, has got worse over time. “In my day” (I am older than sin – and twice as ugly) the school teachers and university lecturers were mostly opposed to people such as Hayek and Mises – but at least as they had heard of them, and the books were in the libraries (that is where I came upon them).
Today the books by Hayek, Mises and so on – are not in the libraries, often not even in university libraries (a lot of space is now given over to computers or admin offices – and guess which books have gone to make space) and school pupils and university students are actively encouraged NOT to read widely – to only look at “texts” on specific “reading lists”.
As for the teachers and university lecturers – well “the lights are on – but no one is at home”, most of them have not even heard of people such as Ludwig Von Mises now, and the few that have heard of Mises think he was some sort of “Fascist” – because the only thing they have read is carefully edited bits of writing when he was flattering the Italian and Austrian Corporate State Fascists – in-an-effort-to-get-them-to-restore-democracy (that bit is left out). That Mises “supported the Austrian Fascists” also carefully leaves out that the only alternatives to the Austrian Christian Social Party were the Marxists (who had murdered millions of people in the Soviet Union) and the National Socialists (Nazis) – that the Austrian “Fascists” were ANTI Nazi is also left out.
What can be done?
I wish I knew what could be done to save the United Kingdom – but I fear it is too late.
I also fear that education in other Western nations has gone the same way.
The Wobbly Guy – you make a lot of good points, and I fear that global domination by the Chinese Communist Party will be even worse than you suggest.
The Westerners who betrayed the Chinese people in 1946, ordering Chang to stop the Manchurian offensive (which was succeeding) and later, the arms embargo, committed a terrible crime – a crime so severe that it can not be overstated.
If there is a Hell – the Westerners who committed this crime are either there already, or will go to Hell after the Last Judgement.
They did not “just” betray the Chinese people – they betrayed Western people’s as well.
Ditto those Westerners who followed a pro CCP policy over the last 50 years.
Far from, for example, “Nixon went to China” being some sort of “good thing” his crawling to Mao, the murderer of tens of millions of human beings, was a crime – a vicious crime, a sickening crime. Indeed it may well have been the long term Death Warrant of what remains of freedom in the world.
Mr Nixon, Mr Heath (Mr Edward Heath carried on his devotion to Mao to the very end of his life – he never repented), and the rest, deserve severe punishment.
I do not know if there is a Last Judgement (I certainly can not prove that death is not the end) – but if (if) there is, the fate of such individuals will be terrible indeed.
Martin.
Yes – when “private companies” turn out to be owned by foreign governments, or by entities such as pension funds whose shares are “managed” by a few entities (such as Black Rock, State Street and Vanguard – which hatve-shares-in-each-other – so are they really only one entity?) talk of a “free market” is nonsense.
It is fiat money and credit bubble banking (yes an old hobby horse of mine – but with good reason) that has created this terrible situation.
It is the “Cantillon Effect” – but on a scale that Richard Cantillon, three centuries ago, could not have imagined.
“I would not start from here” as the Irish side of my family (all dead now) might have said – but, tragically, we do have to start from here.
There is still hope – at least in America and some other nations. Hope that something, something good, will come out of (will be restored) after this present evil (and it is evil) system of fiat money and credit bubble banking collapses – but there will be very hard times to go through.
Of course not. And worse, the centre of Marxism thought is in the West. In its Universities.
China is a simple dictatorship.