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Comment by spaceman_2020 | Hacker News Reader

spaceman_2020

> Economically, they're an adversary; they undercut western manufacturing and all our manufacturing went there.

Wow, you make it sound like it was some devious Chinese plan where they intentionally made their people work for American manufacturers and lured them in with bribes.

The reality was that American corporations willingly went over to China because number must go up and paying their own people living factory wages wasn’t cutting it.

So tired of this stance - “China did it to us!”

America did it to itself.

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> America did it to itself.

Corporations outsourced manufacturing to China, because American corporations are independent from the US government and profit-motivated.

If a corporation is HQed in and operated out of America, and diverts the bulk of its profits to American citizens, it is reasonable to say that "America did it to itself".

American citizens could have voted with their wallets, and they could have voted at the booths to elect governments that would regulate the flow of American jobs overseas. But they didn't, and so here we are.

I think it's important to draw distinctions as to the entity with authority to make a change.

In the Chinese system, that's the market but always capped by political and CCP decisions, if they deign to care.

In the American system, that's resolutely only the market. The government has some limited second order control (tariffs, industrial policy, national security exclusions), but generally didn't use them against China 1990-2018.

Ergo, the deciders moving manufacturing to China were the CEOs of American companies, optimizing their own production costs.

I'd be curious to see an analysis of the rise of Walmart (and immolation of Sears) and later Target vis-a-vis Chinese manufacturing of consumer goods sold in America. I'd be surprised if the centralization of point-of-sale (vs previous more diverse and independent stores) didn't incentivize bulk, low-cost offshore manufacturing via volume.

America is absolutely capable of setting tariffs on imports that would have made that unprofitable. In fact, that policy has been the norm at many times in countries precisely to protect domestic industry.

So it's really more accurate to say that America chose to allow it to be profitable for corporations to outsource. Government policy could easily have been the opposite. So ultimately, America did do it to itself.

(BTW I'm not arguing this would have necessarily been good policy. Just that it is very much an explicit governmental decision.)

this seems to misunderstand what tarrifs actually do. It's the US companies that pay the tarrifs. The concept of 'if we increase the tarrifs, US manufacturing will come back".

That's not how the world works. It takes years to switch a manufacturer depending on terms, who owns the molds, etc.

Placing tarrifs on China hurts American consumers. Instead, there should be tax incentives for producing stateside.

I'm not arguing whether tarriffs are good or bad, but the absolutely do work.

> It's the US companies that pay the tarrifs.

No, customers pay the tarriffs at the end of the day. Companies raise the prices of imported goods to cover the tarriffs, and tarriffs in this case are set so that the final retail price of imported goods matches (or exceeds) the domestic manufacturing price.

> The concept of 'if we increase the tarrifs, US manufacturing will come back"... It takes years...

The idea is generally to have tarriffs from the beginning so manufacturing never leaves. Because you're right, otherwise it does take years.

> Placing tarrifs on China hurts American consumers. Instead, there should be tax incentives for producing stateside.

There's no difference, they harm consumers equally. Corporate tax incentives mean reduced government income which needs to be made up for with... higher personal taxes. Or higher corporate taxes in other sectors which lead to higher prices. No matter what, the consumer is paying.

Tarriffs or tax incentives have the same effect, but tax incentives are usually much more difficult to design and limit corporate flexibility in bad ways that are hard to foresee. Tarriffs have much more reliable enforcement and predictable effects.

>No, customers pay the tarriffs at the end of the day.

This depends on the product and the type of demand. If it's inelastic, yes. if it's consumer focused, yes. But most of the time that's not the case. Tarrifs on material exports ar b2b, where pricing agreements are common.

At the end of the day, tarrifs create downward pressure on companies profit margins. If you instead, gave incentives it would put upward pressure on the companies who created fucundity for the economy.

yea corporations that are staunchly independent until the next recession where they beg for government handouts because they are too important to fail

We weren't smart enough to solve the tragedy of the commons situation because we believed a wealthy China would drop the true-believer Mao ideology.

They did drop maoism. China practices state run capitalism now.

If that was true they wouldn't have own-goaled their own tech sector.

Xi has been talking about returning to Marxism, which I presume means not Maoism and not Dengism.

Most people on HN basically have no idea what Marxism is, what the road to socialism is about, the stages of socialism, or why China really does what they do. I don't watch Xi's speeches on YouTube, but you could if you really wanted to.

They treat "not free market capitalism" as a monolith of ideas and states.

Even a light reading of Marxist economic theory with some other adjacent authors like Lenin, Mao, Trotsky, etc. would make clear exactly why Dengism was needed and why it worked and why Xi finds it necessary to return to straight Marxism.

The worst part is how greedy corporate oligarchs of the US sent all the jobs to China. That made Dengism work really well.

I mean, I don't really know what to say. If you wanted China to lose or not be Marxist, the US did a really bad job. It's really clear the only long-term planning the US does is lining pockets and that's probably going to be the death of the country.

But this is HN, so please pretend like I was complaining about wokeness or whatever other imaginary problem is popular here.

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