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The rise of an increasingly prosperous China has weakened (and may even shattered-we will have to see) one or two happy stories. The first idea is that as a country becomes richer, it will eventually become more democratic. Many people believe that a richer China will become a more democratic China. Although China in the Deng Xiaoping era was not only socially and politically freer than its Mao Zedong predecessor (to be sure, this was one of the lowest thresholds), the massacre in Tiananmen Square showed that (very) partial relaxation was There are strict restrictions. In recent years, political liberalization has undergone a sharp reversal. Under Xi Jinping’s leadership, China has turned to a system that may best be described as fascism with Chinese characteristics, which helps explain the regime’s growing nationalism, control of the technology industry, and increasing willingness. Restrict social and political freedom and emphasize "common prosperity".
Fascist economics (a far from a single concept) cannot be summed up in one sentence, but one of its components may be so-called controlled capitalism, especially when it involves large companies and key sectors. This is not as self-defeating as some believers in the second happy story might think. In many ways, the second story is the other side of the first story. The first connects growing prosperity with increasing political freedom. The second is based on the notion that the most effective way to ensure economic growth is through the mutually reinforcing combination of free markets, the rule of law, and political freedom. Combination should be emphasized that it is not just utilitarian arguments that support it. However, this argument needs to be analyzed very carefully. Although its arguments are generally applicable in advanced economies, the key to growth may be found in other economically underdeveloped economies, and may also be affected by history, geography, and lottery luck: such as abundant natural resources.
Asia provides several good reasons to question the general applicability of the second story. For example, from 1960 to the end of the 1980s, South Korea was neither a democratic advertisement nor a free market, but during that time it saw significant economic growth (but please note that it has evolved into a democratic country) . Then there is China's amazing development trajectory. China’s growth rate is likely to be slowed by Xi Jinping’s adoption of stricter capitalism, but (despite other major potential problems with the Chinese economy) the momentum that has been established may continue for some time. More importantly, although Xi Jinping’s model will mean that China has missed some potential growth, there may be enough growth and expansion of the country’s wealth, even if resources are invested in efforts to ensure technological hegemony: bytes and butter, you can so. This is not a reassuring idea.
Earlier this week, Graham Allison and Eric Schmidt wrote an article in the Wall Street Journal describing a report that focused on the direction of this situation.
CIA Director Bill Burns announced in October that the agency is establishing two new major "mission centers", one focused on China and the other focused on cutting-edge technologies. This move reflects his judgment that China is "the most important geopolitical threat we face in the 21st century" and the "main arena for competition and confrontation" between China and the United States will be advanced technology. The question Americans should ask is: Can China win the science and technology competition?
The new report from the Harvard Belfer Center on "Great Technological Competition" replied: Yes. The report is not alarmist, but it still concludes that China has made such an extraordinary leap and has now become a full range of peer competitors. In every basic technology of the 21st century—artificial intelligence, semiconductors, 5G wireless, quantum information science, biotechnology, and green energy—China will soon become a global leader. In some areas, it is already number one.
The United States still occupies a dominant position in the semiconductor industry, and it has occupied nearly half a century. But China may soon catch up in two important areas: semiconductor manufacturing and chip design. China’s semiconductor production has surpassed that of the United States, and its share of global production has risen from less than 1% in 1990 to 15%, while the US’s share has fallen from 37% to 12%.
In the field of 5G, the Pentagon National Defense Innovation Committee reported that China is expected to replicate the economic and military advantages that the United States has gained as a global 4G leader. China has installed 950,000 base stations, compared with 100,000 in the United States. By the end of last year, 150 million Chinese were using 5G mobile phones with an average speed of 300 megabits per second, while only 6 million Americans were able to use 5G at a speed of 60 megabits per second. ..
The advanced technology that may have the greatest impact on the economy and security in the next decade-artificial intelligence-China leads the United States in key areas. The National Security Council's Spring 2021 report on artificial intelligence warned that by 2030, China is expected to surpass the United States to become a global leader in artificial intelligence. The number of American-born students earning doctorate degrees in artificial intelligence-related fields each year is about the same as in 1990. By 2025, China is expected to graduate twice as many PhDs in science, technology, engineering, and mathematics as the United States.
Go to the report itself to learn more about educational pictures:
In terms of the total number of undergraduate degrees in science and engineering, the United States ranked the global leader with more than 500,000 people in 2000, while China had slightly less than 360,000. Today, the number of graduates of STEM students in China is four times that of the United States (1.3 million vs. 300,000) and three times that of computer scientists (185,000 vs. 65,000). 144 In the international science and technology rankings of K-12 students, China consistently surpassed the United States in mathematics and science. In 2018, China ranked first in PISA scores for evaluating mathematics, science, and reading, while the United States ranked first 25.
On the other hand, I think the United States is ahead of China in these areas.
Every eight years, a group of educators gather to update the [California] math curriculum framework. This particular update has caused additional attention and controversy because it has produced a perceptual change in the way "genius" students progress-and because it pushes Algebra 1 back to 9th grade, it no longer emphasizes calculus and changes The principles of social justice are applied to mathematics courses.
The author of the report quoted Xi as saying:
"Technological innovation has become the main battlefield of global competition, and the battle for technological hegemony will be unprecedentedly fierce."
The Chinese government’s most recent five-year plan emphasizes the need to “develop local capabilities, reduce dependence on foreign technologies, and promote emerging technologies”, determine key performance indicators, set deadlines for results, and require provincial and local governments to be responsible for the results.
As the author of the report has observed, it is generally believed that "the advancement of information technology can only be achieved by free thinkers in a free society, not under an authoritarian regime behind a firewall." China’s current position (even if it is helped by a lot of “borrowing”) proves that this is not the case, and even a fairly cursory study of history shows this. The Soviet Union was eventually completely surpassed by the United States in technology, especially in IT. However, at the same time, the Soviets made some notable technological achievements in other fields. I believe that the assumption that information technology will never succeed is wrong: after all, firewalls can always be penetrated by those who are For those who think it is important enough, look at what is on the other side. Scroll back in time to the Third Reich. When it comes to economics, driving capitalism (click on the link and compare what you read with what Xi Jinping is doing now) is an important part of its regime. However, there have been considerable technological innovations. Interestingly, the innovations included (1941) the development of the first programmable automatic computer.
The complete Belfer report is frustrating to read.
Take this (my emphasis added):
In quantum computing, quantum communications, and quantum sensing—three important subfields of quantum information science (QIS) traditionally led by American researchers—China is catching up, and in some cases has surpassed the United States. QIS, created 30 years ago, has long been regarded as a potential catalyst for revolutionary advancements in science and technology in the scientific community, involving large-scale calculations, faster communications, and accurate measurements. Governments have only recently realized that national security threats that were once considered hypothetical are becoming possible. In fact, threats such as the ability to crack existing encryption to steal state secrets, create completely secure communication lines, and sensors that are accurate enough to free the operating platform from reliance on space-based positioning systems may not be as previously thought. ..
[A] The 2017 report of the US-China Economic and Security Review Commission stated that “China has closed the technological gap with the United States in the field of quantum information science-this is the long-standing U.S. dominance field.” Since that assessment, Beijing has doubled Work hard to list QIS as the top technical priority second only to artificial intelligence in its 14th Five-Year Plan. ..
China has also demonstrated the ability to rapidly transform R&D into operational advantage. In December 2020, only one year after Google’s 53-qubit Sycamore superconducting quantum computer achieved quantum supremacy, China reached the same milestone. That month, the photon quantum computer developed by the University of Science and Technology of China achieved quantum hegemony "10 billion times faster" than Google in certain physical calculations. ..
China's milestones in quantum communications are impressive. ... An expert predicts that the Chinese government and military communications will be paralyzed in just two to three years, which means that the United States will no longer be able to listen.
The news in other industries, including semiconductors, is not good, but I am particularly shocked:
Although the recent US sanctions on Huawei and SMIC’s inclusion in the entity list have slowed China’s progress, completely cutting off China’s access to advanced semiconductors would be a self-destructive policy, because the Chinese market accounts for the total US chip sales. 36% of the total.
This sentence hints at some difficult choices that may be faced in the future. According to the current situation, cutting off mainland China may cause major damage to our chip industry, but if we do not do so. ..
In this regard, this report from The Wall Street Journal earlier this week was fascinating:
U.S. officials plan to ban U.S. investment in Chinese artificial intelligence giant SenseTime, and hope to prevent China’s largest chip makers from buying U.S.-made tools in order to expand the Biden administration’s crackdown on Chinese technology companies. ..
People familiar with the matter said that in addition, officials plan to discuss a proposal by the Department of Defense this month to close a regulatory loophole that allows semiconductor manufacturing international companies to purchase critical US technology. As we all know, SMIC has been able to continue to purchase American tools to manufacture chips, even though it is included in the Entity List of the Department of Commerce, which aims to restrict access to major US exports.
Belfer's report is by no means doom and pessimism. Its author is well aware of the panic in Japan in the 1980s. In other words, they also outline the structural reasons why the Chinese today are more powerful competitors than the Japanese 40 years ago. In addition, Japan is an ally and cannot be regarded as a military threat by any means. China cannot say that.
So what should I do? This is another discussion (Schmidt and Alison called for "similar to mobilization that created the technology to win World War II"). A better precedent (for the time being) may be found in the steps taken in the United States after the Soviet Union took the lead in space, and another in the public-private partnership that cooperated well with Operation Warp Speed turn up. However, one thing is very clear (Washington increasingly admits this). As far as China is concerned, there is no room for business as usual.
We released the latest podcast series Capital Record. Follow the link to see how to subscribe (it's free!). The weekly "Capital Record" aims to use another medium to provide a defense of capital affairs against free markets. Financier and NRI trustee David L. Bahnsen hosted a discussion on economics and finance in this National Censorship of Capital Matters podcast sponsored by the National Censorship Institute. The series features interviews with top American business leaders, entrepreneurs, investment professionals, and financial commentators.
In episode 46, David joined Ryan Anderson, chairman of the Center for Ethics and Policy in Washington, DC. Ryan is one of the country’s most important intellectuals in political philosophy and social thought, and is applying his discipline to economic rights. . David and Ryan used this podcast time to delve into the current debate about the prevailing market in faith circles, in which those who are flustered by the state of cultural wars view the market with increasing skepticism. David worried that the horse was about to leave the barn, because many of the best and brightest people on the right gave up confidence in the market, and Ryan brought the calm, sobriety and wisdom that this critical topic desperately needed.
Capital issue week that is. ..
In just over a decade, the Federal Reserve has been asked to fight the global financial crisis and epidemics. The monetary response to these events represents a fundamental departure from the status quo. Although much has been written about the technical aspects of these policies, little consideration has been given to their political impact. In the book "Money and the Rule of Law: The Universality and Predictability of the Monetary System", Professors Peter W. Boettke, Alexander William Salter, and Daniel J. Smith argue that the lack of consideration of such effects has not only led to a larger economy Instability, and also transformed our central bank into an institution that is not subject to the rule of law. ..
The Biden administration is trying to fabricate a story about the progress of the supply chain crisis. It does not work.
As Jim Geraghty emphasized in Morning Jolt today, many companies across the country are facing shortages of various products. As I pointed out last week, the shorter queuing time for ships waiting to unload in Los Angeles and Long Beach is the result of a different queuing system, not a higher efficiency. This route is actually longer than three weeks ago, and the timeliness of trans-Pacific freight is the worst in history. ..
In an era when the supply chain is making headlines due to various wrong reasons, what is the silver lining?
In today's webinar sponsored by the supply chain technology company FourKites, the panelists discussed this topic, and there are some reasons for optimism.
Consensus: The supply chain has received more attention than ever before, and with it comes the need for improvement. ..
Who would you believe will tell you the truth about port congestion? It is reported that the Biden administration is coordinating with the media to report in a more positive direction. It is important to have reservations about what they tell you.
Industry sources seem to be more trustworthy. The logistics industry is one of the most thoroughly internationalized industries in the world, so the political concerns of any country have almost no impact on the information it reports. In addition, if the information is wrong, those people all over the world will have a lot of money at risk. This is especially true now, people are working harder than ever before and face higher costs with limited capabilities.
Therefore, when DHL stated that it expects shipping to remain congested next year, I believe they make sense. ..
Freightos, a logistics company, surveyed more than 300 importers who used its services. They sent the first survey in January, another in June, and the most recent one was in November. This is not a scientific survey, so the results cannot be extended to the whole country. But it provides a useful perspective on how companies respond to supply chain challenges. ..
I have never-how to say-fully believe that a "sustainable" economy will become the employment machine its supporters like to claim. This is a good thing for regulators, and for consultants hired to guide companies through the labyrinth that regulators will create, it will be an asset. But beyond that, the job creation situation is. .. Not sure. To give a key example, as currently envisioned, the transition from fossil fuels will almost certainly increase energy costs (and likely reduce their reliability). This is not the obvious secret of job creation. ..
It is not wise to bet on human ingenuity, but the shortage of lanes is an electric car problem, which may be more urgent and trickier than most people (imagine what it would be like in densely populated Europe). Of course, some greens will see this as a function, not an error. Public transit! Bike path! walk!
I first met Senator Robert Dole when he was a senior advisor to the Senate Joint Economic Committee from 1984 to 1986. During that time, my good friend Senator Steve Sims (Idaho Republican Party) introduced me to Dole. It turns out that we hit it off immediately. I think this is partly because we are three country boys (Dole from Kansas, Symms from Idaho, and the real you from Iowa). We speak the same language, if you will. ..
This is a long-standing practice that has become extremely active in recent years-a better word may be "utilization"-in recent years: obvious, planned and unusual political use by non-profit organizations (and by) Federal laws related to misuse and charitable donations were initiated by left-wing philanthropists and party billionaires, who generously donated their money in a targeted manner to achieve the purpose of partisan pranks and ballot box influence. This abuse is blatant-certainly worthy of debate and reform in Congress, the guardian of the US tax law.
Could this kind of abuse be so blatant that Congress might notice it? After all, strong legislation addressing the issue of tax exemption is being erected on the flagpole on Capitol Hill.
Alas, this is a fake: the initiators of the bill intend to reform anything, except for this practice of mixing up sharp partisan politics full of non-taxable dollars. ..
Casey Mulligan and Thomas Phillipson:
The 17 Nobel Prize-winning economists declared that the settlement bill currently in Congress is called "better reconstruction" and is an important part of "strong economic recovery." They ignore economic trade-offs and violate their award-winning science.
Build Back Better (BBB) is a 2,100-page exercise on energy market redistribution and government-led change. Nobel Prize winners believe that redistribution is a fair thing, and the United States should do its part to reduce global carbon emissions. Although it can be said to be worthwhile, both of these activities will shrink the US economy. Weighing is one of the economic facts in life.
Perhaps the Nobel Prize winner has adopted a new vocabulary that is different from the one used by you and me. When they say "strong economic recovery", we should understand it as "slowing down economic growth for the sake of fairness and the environment."
More likely, they have not read the bill. ..
Of course, pharmaceutical companies are not angels, but it is important to remember that the excess profits they make on some products have to pay for the cost of drugs that they spent a lot of money but did not live up to their development team's hopes. for them.
It should also be remembered that motivation is effective. I don't believe that Sanders is the right person to decide what represents "too much" motivation. In addition, although some companies get all the profits from the vaccine, by limiting the damage caused by the virus, no matter how imperfect, they retain a much greater financial value (including work). And those little things that save lives. ..
The most important thing to remember about the labor market now is that this question is the opposite of what we are used to after the recession. We don’t need more work; we need more workers. After the last recession, the name of the game was job creation. This time, no. ..
Eight months after its promulgation, the US$1.9 trillion American Rescue Program (ARP) continues to be the most destructive spending bill promulgated in decades. ARP was initially promoted primarily as health care legislation to fund Covid vaccines and treatments (although only 1% of its cost is for vaccines and only 5% has any direct relationship with health care), and secondly as a relief bill. Instead, the legislation has become a lot of gifts and economic "stimulus" clauses. Even center-left economists such as Lawrence Summers, Jason Furman, and Mark Zandi have warned that these clauses are too expensive and too currency. Inflated, unnecessary, and wasteful. Just a few weeks ago, Republicans in Congress passed a $900 billion relief bill. They bargained desperately, trying to negotiate an unnecessary $1.9 trillion proposal Down. Despite their empty remarks about bipartisan cooperation and compromise, President Biden and Congressional Democrats responded by cutting off negotiations, and their opening proposal did not move an inch. With the failure of the economic stimulus plan, the bill became a political "McGoffin", or a symbolic tool for the Democrats to "resist Republican obstruction" and show that they are also prepared to adopt a tough attitude to pass their agenda. The details of the bill are secondary. The Democratic Party passed the bill by a party vote, and President Biden signed the bill. ..
Jonathan Williams and Nick Stark:
Tax cuts are not the cause of the debt trap. Irresponsible spending growth creates problems. Unfortunately, the political drama surrounding the federal debt ceiling will continue until Congress learns to pass a responsible budget. ..
BlackRock is making history through an innovative policy change: it will soon let its largest institutional client vote on the company's agency. Although critics have pointed out that BlackRock’s huge changes in its client stock voting are limited to a small group of wealthy funds, the move may trigger a democratic resurgence of shareholders that will come sooner or later.
This will solve the paradox that has accompanied the sharp rise of index funds since the 1990s. The widespread supply of low-cost index products democratizes share ownership and enables every family to enter the capital market as never before. But the control of the resulting votes went in the opposite direction. Now, it is concentrated among the elite insiders of BlackRock and two other funds, State Street and Vanguard, and is preparing to place actual control of most American companies in the hands of only 12 people. ..
"Researchers have found that due to the initial coronavirus assistance program, inflation in the United States may persist," reads the title of today's market observation story. In the United States, inflation - once temporary, now lingering - surged by 6.2% last year. In the Eurozone, consumer prices rose 4.1% during this period. In Japan, this ratio is 0.1%. why? Hyun-Song Shin, head of research at the Bank for International Settlements, said that part of the reason is that the United States relies on generous unemployment benefits and populist stimulus checks rather than saving existing jobs. ..
Today's inflation report found that prices rose by 6.8% in November, the fastest rate of inflation since 1982. Even before the release of these new data, the latest opinion poll from Monmouth University found that in an open-ended survey question-which means that the pollster asked the question but did not provide a multiple choice answer-29% Of Americans say that inflation or rising prices are their biggest concern. This is far more than Covid (only 18% of respondents listed it as the country's most worrying issue) or any other single issue.
The situation was quite different in the last August, when Monmouth discovered that a total of 8% of Americans listed price increases as their main concern. ..
In this way, we are back to the Volcker era-just can't see Volcker. ..
The Democratic Congressional Campaign Committee published a chart on Twitter on December 2 showing that from November 15 to November 29, gasoline prices fell by 2 cents. The headline said, "Thank you, Joe Biden", apparently a trust in the president-gasoline prices fell slightly. It is widely ridiculed. Even many people on the left are deaf at best and dishonest at worst.
Somehow, it looks more stupid now. ..
Recently, Americans have had to face a harsh reality: high oil prices. The president has been looking for ways to reduce fuel costs. His first solution was to ask the Federal Trade Commission to investigate whether oil companies were engaged in "price fraud." His second move is to release the Federal Petroleum Reserve.
These decisions are not enough to reduce natural gas prices. Asking the Federal Trade Commission to review oil companies is a waste of taxpayers' money. The release of the Federal Petroleum Reserve will only bring uncertainty to the market, thereby distorting the normal operation of the economy. The core of the problem is that the President misunderstood the basic role of price in our economy, leading him to implement the wrong solution. ..
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