this post was submitted on 11 Mar 2024
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The WSJ reports that China is on an extensive push to drive out Western tech companies from the country and replace them with domestic alternatives. China reportedly started its domestic expansion in 2022 with a highly secretive "Document 79," an initiative focused on deleting Western tech companies from the country. Since then, China's new plan has been in full effect — domestic alternatives have replaced most Western software providers.

When initiated two years ago, Document 79 was a super sensitive document that only high-ranking officials were purportedly shown. Security was so paramount that copies of the document were not allowed to be made. The initiative set out by Document 79 is to replace foreign software in China's IT systems by 2027, with state-owned firms required to provide quarterly updates on their progress in replacing foreign software with domestic alternatives.

Two years later, the fruits of Document 79 are now apparent. Microsoft, HP Enterprise, and Cisco's market share in China has fallen drastically in the past several years. In 2018, HP Enterprise had a 14.1% market share in China, but in 2023, that has fallen to just 4%. Cisco's market share has halved in the past five years down to just 8%. Microsoft's Chinese sales today account for just 1.5% of the company's overall sales.

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[–] [email protected] 17 points 8 months ago (3 children)

Let’s cut through the noise here. The idea that China has been playing 4D chess while the West plays checkers is a sexy narrative, but it misses the forest for the trees. Yes, China has masterfully leveraged the existing global system, pulling itself up from the economic bootstraps with a mix of state-driven capitalism and strategic engagement with Western technology and markets. This isn’t a con; it’s smart strategy, plain and simple. They saw an opening in the global market’s hunger for cheap labor and pounced, all while Western companies tripped over themselves to cut costs and boost quarterly earnings. Exploitative? Perhaps. But a con game? Hardly. Both sides knew what they were getting into; it was a marriage of convenience where both parties shared the bed for mutual benefit.

Now, onto this doomsday prophecy about the U.S. spiraling into oblivion. If you’re betting on American collapse, you’re going to lose your shirt. The U.S. isn’t just standing; it’s adapting and moving in ways that the naysayers seem to conveniently overlook. Post-COVID, the stats tell a story not of decline but of rebound and resilience. Unemployment’s in check, inflation fears are being managed, and domestic consumption is through the roof. Americans are spending, industries are innovating, and energy? The U.S. is sitting on an energy bonanza that makes the Middle Eastern oil sheikhs blush. Thanks to shale, the U.S. is not just energy independent; it’s a global energy heavyweight.

And let’s not forget technology. Silicon Valley isn’t just a place; it’s a global beacon of innovation. AI, biotech, quantum computing—you name it, the U.S. is at the sharp end of the spear. This innovation engine isn’t sputtering; it’s accelerating, fueled by a demographic dynamism that much of the developed world can only dream of, thanks largely to immigration.

As for Europe, casting it as the West’s last bastion against a rising China misses the point. Europe has its cards to play, sure, but don’t count the U.S. out of the game. The American economy is a behemoth, driven by internal markets, technological supremacy, and demographic vitality. Europe’s integration and strategic coherence are worth watching, but let’s not pretend it’s the only show in town.

In sum, the narrative that China’s rise comes at the expense of a declining West, and particularly a faltering U.S., is overly simplistic and frankly, wrong. We’re in a period of massive global transition, sure, but the American decline? That’s not the story being written. The U.S. is shifting gears, and the next chapter might just surprise the gloom-and-doom crowd.

[–] GregorGizeh 14 points 8 months ago (1 children)

I don’t necessarily believe the United States will collapse, but we can already see that it is becoming an increasingly unreliable partner that basically flip flops on all positions depending which party is in control. They are also seemingly weary of their role as global hegemon, adapting a more isolationist and inwards oriented position.

This doesn’t mean that the u.s. will break down completely, but I could see some secessionist nonsense happening in the near future, or the looming slip into religious fascism. The country has massive internal problems that hamper its ability to maintain its role as global player, aside from their direct interests.

[–] [email protected] 5 points 8 months ago (1 children)

The thing is, American politics is inherently cyclical. Yes, it’s a rollercoaster with the parties flipping policies like burgers at a BBQ, but that’s the beauty of it. This isn’t weakness; it’s the vibrancy of democracy in action. It creates a resilience, a kind of institutional elasticity that’s unique.

Now, about the U.S. pulling back from the world stage—it’s not so much isolationism as it is recalibration. America’s geography, its energy independence—these are cards other countries can only dream of. This allows for a shift in priorities without losing global influence. The world’s changing; the U.S. is just adjusting its sails, not abandoning the ship.

Talk of secession, extremism—it’s eye-catching, sure, but let’s not get carried away. The U.S. is facing challenges, absolutely. Polarization, debates on its identity and role globally, these are serious. But remember, the U.S. has navigated through civil wars, major economic depressions, and profound social changes. It’s not just going to crumble.

In this global game, where uncertainty seems to be the only constant, the U.S. remains a key player. It’s picking its battles, sure, but when it steps onto the field, it plays to win. The essence here is not about a retreat but a strategic pivot. The world’s a complex place, and the U.S., with all its debates and divisions, is still right at the heart of it, making moves that count.

[–] [email protected] 2 points 8 months ago

Great non-ideological analysis.

[–] [email protected] 10 points 8 months ago

I predict serious problems with the US economy if wealth inequality and housing affordability are not addressed. Those are the biggest problems and US leadership doesn’t seem to even want to address them.

[–] [email protected] 0 points 8 months ago* (last edited 8 months ago) (1 children)

The con was that the western companies gave over some serious IP for a decade or maybe 2 of cheap manufacturing. China was trying to industrialize for decades and essentially couldn't do it. Walk in the western companies and they gave all the knowledge, skill, everything ($$$$) for some cheap labour ($).

Western companies think 5 years is a long term plan, so they'll take whatever terms for 5 years (mayyybe 10 if they are unheard of long term planning) and after that is ????, but profit-now-is-everything-by-definition. But China is playing decades at a time, they are getting decades, close to a century of IP, for next to nothing in the big picture.

[–] [email protected] 3 points 8 months ago (1 children)

Yes, china got some leapfrog effect, but tech isn't static. And they are going to hit a wall with AI in particular because of the rampant censorship they cling to for no good reason.

We have seen this play out before. The closed down, autocratic paradigms lose out to the open, permissive ones. If America ends up in decline it will be because Christian nationalists fucked it all up, but it's not going to make China more powerful. The only way for China to become powerful is to liberalize.

[–] [email protected] -1 points 8 months ago* (last edited 8 months ago)

That's not what leapfroging is. Leapfrogging is skipping over technology EG skipping over land lines and going to cell phones. That does happen but that wasn't what I was getting at. What I'm getting at is they took in serious serious IP and industrial knowledge. They took in, this is a bit of hyperbole just to get the point across, a century of IP in exchange for some cheap labor for a couple decades. That's how short-sighted Western companies are. (A few decades overall, but for any specific company contract they would get the IP in 5 to 10 years.)

Nor did I suggest that they're closing down. You're simply off the mark on that. I don't think the other guy suggested that either, but I didn't address it. They want to sell to Africa, South America, etc.