China Is Nationalizing Its Tech Sector

You claim:

> The objective is not "control" of the tech sector as the article pretends, it is just greater collaboration.

From the article:

> This quasi-nationalization applies to China's startup scene, too. One recent report found that 60 percent of Chinese unicorns have either direct or indirect investment from the BATs. China's venture-capital sector is dominated not by traditional tech dealmakers but by the state: There are more than 1,000 government-owned VC firms in China, controlling more than $750 billion.

So the Chinese government buys stakes in most Chinese startups, through its wholly-owned VCs and other vehicles.

These stakes give the Chinese government control over these startups.

You further claim:

> You can say they are making a police state, but at least they can maintain law and order, and are willing to keep thinking long-term and keep innovating even in government.

Which frankly sounds like PRC propaganda.

The Amazon supply chain is fantastic indeed. And the end-user experience can be astounding.

I'm in Singapore and am thinking about ordering a standing desk from the USA. Delivery is free in 7-9 days. The desk cost $200. At any other company the delivery would be $200. The local cost is much more. How can anyone compete with that?

And in-country, tonight at exactly 20:45 I placed an order for a tripod and about 50kg of boxed water on Prime. It's being delivered, free of course, 10am tomorrow. The total order cost was S$60.

Think about what it takes to orchestrate that. First you have to have the stuff and know you have it, ok that's standard. Then the app with realtime inventory & delivery availability. Then you have about 12 hours to get that picked and packed, labelled, and into the delivery van you knew you had available at that time, oh and sorted in the optimised delivery order you meanwhile figured out please so you do that at the last minute. You need to make all that happen for what, $3 max to still be profitable? Frigging amazing.

> I wonder how China is prepared to handle the impact Global Warming will have on agriculture.

Look up China's artificial rain furnaces in the Himalayas. Also on a related note, China controls a large portion of neighbouring countries' river sources. Combined with dams, which are so numerours in China that there should be a dam on its flag, China can control water flow to its neighbours, or polute it, or refuse to provide information relevant to forecasting floods. All of which it has already done.

I'm waiting eagerly for financial instruments for shorting water supply.

Would a more accurate description be that China is "militarizing," its tech sector instead of "nationalizing" it?

When we think of nationalization, we tend to think of centralized control by committee, removal of competition, five year plans etc. But militarization of an economy, like that of Britain during WWII, means working toward and pricing based on a shared (if mandated) national objective.

Western aviation is largely militarized in this sense, and looking at communications tech in China the way we look at aviation here is probably a better simile.

There is a tendency to portray the Chinese communist party as a farce of clumsy peasants toeing the party line and driving their economy into ruin, as though they were the bolsheviks or Stalin's apparatchiks. Those tropes do a disservice to those of us who really do need to be aware of the sophistication and hyper-aggression of Chinese economic warfare.

Viewing China as an "emerging," economy and society presumes the end state will evolve to something resembling western democracy and a free market economy, which is the very hubris they are exploiting to consolidate and militarize their industries and territories for global expansion.

It would be helpful to everyone to elevate the quality of discussion of these topics, as CFIUS will only protect us so much.

Well that's good for everyone else competing with China. It will slow innovation. Imagine if you had to worry about doing something that pissed off someone on your companies "Communist Committee" (or whatever the article called them). Yes, in general a company in China has to be careful how it treads with respect to the national communist party, but now they'll have to worry about the lower level people that are inside their company. And those "party" people will have ambitions, and when the company does good, they will do good. BUT, those (at least some of those) same party people will be risk averse, probably a lot more risk averse than a typical tech innovator. Think about politicians here in the US and how long it takes them to embrace things that are already popular with the general public (marijuana legalization for example). That's what these companies will be up against, and it will slow them down.