Yes and no. Having more competition in the space is excellent news. However I am sad that the world interdependence is eroding as most other countries seem to sit on their hands and happily outsource every bit of manufacturing to a single country.
> unless one considers China and Taiwan to be the same countries
The fact that the CCP is relaxed about core Chinese companies running their manufacturing in Taiwan might suggest that the CCP considers that it can make China and Taiwan one country, at a time of the CCP's choosing.
They would lose all of TSMC if they do any military actions. It's not the fact that the CCP thinks that they can make Taiwan and China a country, it's the the fact that most of China does in fact consider them as one country. Taiwan is ready to defend themselves, but are very happy keeping their relationship with China the way it is.
"Very happy" is a bit of a stretch, since a significant proportion of Taiwan would prefer to jettison the current pretence of being "One China" and become fully independent.
But I agree that pretty much everybody will happily take the status quo over armed invasion.
I have a friend in Taiwan and he told me they're pretty happy because they have independence this way. If they go for more international recognition etc they'll gain nothing they don't already have but they'll upset the balance and give the CCP a reason to invade. So it will only make things worse.
And a lot of people are sympathetic with the Chinese, just not their government.
I've only visited Taiwan once and I only have one friend there so perhaps what I'm hearing is not accurate.
and related to, with all that holds in an Eastern mindset. My adoptive grandmother was born in Shanghai in 1927. To my knowledge she never returned to Mainland China, partially because her relatives wen Telswhere when the communists came in.
> give the CCP a reason to invade. So it will only make things worse.
CCP is not threatening taiwan because it might go for independence. it is _ALL_ about kicking the US out of the west Pacific. because of that, it is never about what people in Taiwan believe/say/do.
It is only about the military balance of the west Pacific.
> And a lot of people are sympathetic with the Chinese, just not their government.
sympathetic of what?
20 years ago, you might be able to play the "CCP regime repressing the people in China" joke, you can't do it anymore especially in such topic of Taiwan. quality of life is significantly better in literally every aspect in China. Taipei in 2026 is getting more and more like a tier-3 Chinese city in 2016.
> it is _ALL_ about kicking the US out of the west Pacific
I think you are underestimating Chinese nationalism here quite dramatically!
Chinese views of sovereignty are quite independent of other concerns. Take for example their actions against Vietnam in the South China Sea, forcing Vietnam closer to the Philippines and even the US: https://digital-commons.usnwc.edu/cgi/viewcontent.cgi?articl...
> it is _ALL_ about kicking the US out of the west Pacific.
Hardly. It is all about Xi having declared that taking Taiwan by... I think it was 2049, but could be misremembering. Anyway, Xi made that a test of the legitimacy of the CCP, in some very public statements.
So, no, it's not about kicking the US out of the west Pacific. It's about Taiwan, and it's because if they don't, the CCP is illegitimate, by Xi's own word.
By 2023 Xi ordered the Chinese military to be ready to invade Taiwan by 2027.
But that doesn't mean they plan to invade Taiwan by then. One common reading of it is that it was a plan to build up the military to that state with a definite goal date (in the same way the "600 ship navy" plan had a goal date).
The point is that the goal is far enough into the future that the person making it can't be held accountable for failing to meet it.
If Xi had said "the CCP is illegitimate unless it takes Taiwan by 2025", he would be at real risk of being replaced in 2026. Anyone who opposed him (or just wanted power) would have a perfect reason to replace him.
When Xi makes a goal with a "deadline" he won't live to see, he takes no risk of personally failing to meet the goal. If his successor misses the deadline, he can say things changed, Xi failed to consider factors X,Y,Z, etc.
> If his successor misses the deadline, he can say things changed, Xi failed to consider factors X,Y,Z, etc.
That's not how the CCP operates though.
They are not a country where the puppets matter so much, like in most of the western countries. You would very very rarely see a leader being critical of their predecessor even if they are changing policies (which Xi Jinping definitely did). Because they are the same party and thus they are attacking themselves. The party is really more important than whoever happens to be at the top. The party is always right. Even when the party is wrong. Which it is not because it's always right.
No, if this promise disappears it will be silently. Never to be mentioned again, or else. It just never happened.
> And the whole concept of bringing everything down to a matter of wealth is so American.
They said "quality of life". Even if they had said wealth that correlates with quality of life so that wouldn't be a very good gotcha by itself, but they didn't say that.
But calling Taipei a "Tier-3" city does refer to economic prowess, that's what I mean.
If you like to say what you think, then trust me, Taipei has much better quality of life. If you see people like Naomi Wu being arrested and gagged just for pointing out a vulnerability in software (which we all agree here is a good thing to do for everyone except the bad guys), that is terrible.
Not only a few people in and from Taiwan use every chance they get to shit talk the mainland. Be it snark about using simplified characters, or be it trying to prevent their own citizens from taking part in celebrations of victory over fascism. Main theme is being against the mainland, no matter what. They are also very influenced by Japan, whose right wing PM has escalated outrage more than enough recently.
Certainly, somewhat understandable, given the "military exercises" at the doorstep happening every now and then, but also escalatory and idiotically not a good look either. Some of it is just spewed hatred, not taking a high lane when it comes to ethics.
I think the plan is to defend, with allies motivated by the goal of saving TSMC facilities. If you destroy them the moment China declares war, Taiwanese allies might be much less invested
But at the same time everyone understands that the Taiwanese would destroy the facilities before they fall into Chinese hands
Not everyone is affected by propaganda, either US/Taiwanese or Chinese one.
Some are.
Some people also want to feed their families and not be unemployed.
P.S. A large number of Ukrainians moved to Russia. Including the ones who wanted to reunite with their relatives. Taiwanese have a lot of relatives on the mainland as well.
> *As of mid-June 2023 an estimated 1.2 million Ukrainians were recorded in the Russian Federation under different legal forms of stay (other than refugee or temporary asylum status)
This means people that have Ukrainian citizenship, which includes lots of families that were on both sides of the border. It does not mean people who were residents of Ukraine before the war, and decided to move to Russia. It does include the kidnapped children, and surviving people in occupied cities.
The US cannot offer lots of money to chip fab refugees today, because they are not refugees. Trying to headhunt people at a high quality job is very different.
Part of the reason a Chinese invasion of Taiwan seems more realistic is Trump being a sycophant towards any dictator who will give him the time of day, including Xi Jinping.
It's not impossible, but I feel as though if Trump decides that China is friends and Taiwan is enemies (as he seems to have done with North/South Korea lately) then Taiwanese refugees might not be as eager to move to the US as, say, Canada, Australia, or Europe.
We are talking about facilities that are extremely complex and expensive to build, to the point that only a very small handful of locations in the world exist today - despite their massive economic value.
TSMC is not something you can rebuild with some brains in front of laptops.
its not official public policy, but there have been people in the US government saying that if there is a war then the US will bomb tsmc facilities in taiwan
I think you're missing what I'm getting at. Yes, I understand that part. But do you seriously think that if TSMC was destroyed right now, China would change its decision to invade Taiwan? Can you imagine what the actual consequences of executing that plan would be?
My bet would be that invasion wouldn't look like quick war, but slow control of political power either through light force like economic blackmail, or through something similar to what US did with Venezuela.
Now that US has already opened the gate to labelling nation head as drug seller, this just eases things for China.
Yes and no. The Iran war is deeply unpopular and won’t even pass congressional approval for money. It’s being fought from pocket change budgets because they know they can’t pass a funding bill for it. Also not the same kind of war.
Any period time? US waged war for 20+ years in Afghanistan. Pretty effectively! To what end? Not an end an army can really achieve so… there you are.
But a war that might actually be popular? To save the world from communist dictators and make sure we have chips for our precious devices? I wouldn’t count out the United States. Or nuclear weapons, which still exist and are a thing.
That was an occupation and a low intensity “pacification” mission. Waging a prolonged war against a military peer on the other side of the continent is a bit more problematic (considering that US is/was on the brink of running out of advanced weaponry in Iran despite having aerial superiority which they won’t over Taiwan, Japan would have to get involved as well cause otherwise US would have to entirely rely on the fragile carrier fleet).
Using tactical nukes (even regardless of the extreme geopolitical downsides that might bring) wouldn’t necessarily give a great tactical advantage either, unless they are willing to do that over Taiwan itself to destroy the landing forces).
And it'd be the kind of war the US is best at. Boots on the ground, against conventional military, with a civilian population that is on the side of the US forces
No guerilla warfare, no insurgents, no need for extended beyond-visual-range warfare that depletes missile stockpiles
Last time used faced a conventional military that could actually challenge it was in Korea.
It won’t have complete areal superiority or entire division surrendering after running into contact with US forces like they in Iraq. “Shock and awe” of course can be very effective just probably not against China. Even now US is running out of materiel against Iran and can’t really sustain a prolonged intense conflict while being able to protect its gulf allies from ballistic missiles and drones.
Iran is not a war funded by congress, so it's really no wonder the US appears inneffective. Trump didn't get the support he thought he would from congress and now he's flailing around trying to save face.
Change the leadership (which will happen soon) and when there is actual support from congress to fund and intervene in a conflict in Taiwan, then you will see a vastly different US military response.
The war over Taiwan wouldn't be done by soldiers on Taiwanese soil. So you wouldn't need many boots on the ground in a literal sense.
But if you mean in a metaphorical sense, how long until the 7th Fleet could get to Taiwan, the answer is 0 days for first response, 3 days for everything located in Japan, and less than a week for the full mobilization of the 7th Fleet (that's 50+ ships and nearly 30K soldiers). The entire Pacific fleet could be there in a week and a half.
(Granted, we're assuming competent US leadership, which is not the current administration.)
just a gut feeling, but if they had to for some reason, I feel like they'd just go in and bomb as much strategic assets and invade, because in their eyes aside from Taiwan, there isn't much left to "unify" and it'd be historic, not something they'd need to do every decade or even century
I feel like Russia thought the same of Ukraine, even though it is way bigger
Any country that competently adopts Ukrainian drone technology cannot effectively be invaded currently. And that's for a continental invasion.
Taiwan? All surface ships are sitting ducks. Troop transport ships would get absolutely decimated, and then the landing troops would get swarmed by drones all over again, and then they have to maintain logistics to the small minority that land (good luck with that). And that's without naval drones.
With naval drones? I have no idea how China gets anything across the strait.
And all the above is true for a competently organized Chinese invasion. Which it won't be.
> adopts Ukrainian drone technology cannot effectively be invaded currently
The tactical situation in Taiwan is very different though. I think it would come down more to what’s happening in the air since the stalemate in Ukraine is in large because the Russian airforce is almost completely neutralized and can only be used to launch cruise missiles from a safe distance. I doubt China would invade unless they feel they can somehow achieve at least temporary air superiority and achieve their other objectives during that period.
Air defenses are probably much more important than drones overall.
That's why I said it will be slow. I think it will be decades long political control, not a military invasion.
China have more credible threat of bombing economically relevant building like TSMC, or capturing leaders and protestors like they already are doing in Hong Kong.
But nonetheless China is clearly preparing itself to be ready to be able to invade, with aircraft carriers, amphibious assault ships, dual purpose roll-on/roll-off carriers. It doesn't mean it will, but that it wants to be able to.
So basically it will depend on a single dictator's whim if they do or don't.
> Establish a total naval and air blockade of Taiwan using their fleets stationed in Ningbo and Zhanjiang
Which would be considered an act of war, so it's the same scenario again.
> There is a substantial opposition in Taiwan that want reunification (~20% of population support directly Li-Wun)
20% is more than the % of people in the Donbass that wanted unification with Russia, and we can see how well that went. And it wasn't a dangerous amphibious assault against an island with shit terrain.
Arguable, they had to after the 2008 Buharest NATO summit and Ukraine's militarization going forward, and eradication of Russian language and Russian-speaking population in the east.
> Which would be considered an act of war, so it's the same scenario again.
China considers Taiwan their territory, who is there to protect Taiwan? US?
>20% is more than the % of people in the Donbass that wanted unification with Russia
20% plus part of those white-collar workers who are a backbone of the Taiwan's economy and politics and can be left jobless after China achieves EUV and puts TSMC out of monopoly.
Let's be real. Trump demanded TSMC to invest 100B into US factories and they complied [0].
> Arguable, they had to after the 2008 Buharest NATO summit
How dare the countries threatened by Russia, who had seen how Russia invaded and brutalised multiple countries - Moldova, Checnya, Georgia twice - seek protection from Russia. This totally excuses Russia invading and brutalising again, of course.
> Ukraine's militarization going forward
The country was literally invaded (Crimea and Donbass), what the hell did you or the idiots in the Kremlin expect? That it will just sit and allow Russia to take more of its territory unopposed? That it will become a pliant vassal state again?
> eradication of Russian language and Russian-speaking population in the east
Such eradication that the country elected a Russian speaker to be president, on a platform of reconciliation with Russia. So much so, that his opposition called him a Russian puppet. That guy is Zelenskyy.
I'm sorry, but you're either out of your mind, or have been completely brainwashed. Russia chose to invade multiple of its neighbours, and did unspeakable atrocities every time. The only one to fault for all of this, and everyone around them seeking protection from this, is them. This imperialist nonsense brutality does not belong in the 21st century, and neither does its apologia. And no, I don't care about the whataboutism you're preparing to "defend" these actions with, it's beyond irrelevant. It's what the Russian state has been about since it came into being out of the ruins of the USSR. We should have never treated them as anything else.
> How dare the countries threatened by Russia, who had seen how Russia invaded and brutalised multiple countries - Moldova, Checnya, Georgia twice - seek protection from Russia. This totally excuses Russia invading and brutalising again, of course.
That's literally a copy-paste from propaganda pamphlet.
Can you back it up?
> The country was literally invaded
You seem to forget the amount of killings Ukraine did there and why it started in the first place.
Why should I discuss that with a person who seems to be unaware of facts?
What exactly do you want backed up? That countries across Eastern Europe saw how the russians operate and decided they don't want to be destroyed?
> You seem to forget the amount of killings Ukraine did there and why it started in the first place.
What killings did Ukraine make that resulted in russia invading Crimea? Or russia starting the invasion of the Donbass? MH17 maybe? Oh no, wait, that was the russians too.
All your points consider what China can do but not how others would respond. Blocking Taiwan when the whole AI economy is running on it will invoke lots of countries to go up in arms. There was a quote from US military that it'd cost less to fight than watch Taiwan fall (invasion or not).
> 4. China is close to producing industry-grade EUV
No where near close. At least not production grade at massive scale.
> * Establish a total naval and air blockade of Taiwan using their fleets stationed in Ningbo and Zhanjiang.
Doesn't work. If they do that the US, JP and others can also blockade around Shanghai, Hong Kong and the other ports.
> They won't need TSMC soon
Taiwan is not just TSMC. There are thousands to millions of things involving Taiwan you're likely not aware of and they might not even be AI or semi related.
> All your points consider what China can do but not how others would respond.
US backed off last year when there were talks about protecting Taiwan. They pulled Patriot missiles from Taiwan and South Korea too.
China and Japan have a beef. Considering the atrocities Japan did in China, the conversation won't be friendly.
None of these are good for Taiwan, during the times when its political system is failing.
> No where near close. At least not production grade at massive scale.
It looks like you have knowledge of the status of that super-secret government project. Can you share some details then?
> Doesn't work. If they do that the US, JP and others can also blockade around Shanghai, Hong Kong and the other ports.
US cannot blockade Hormuz, as we've seen. JP cannot do that with their current constitution unless they change it (the current government is on the road to it, though).
What we've also seen is that Chinese fishing fleet had a military blockade exercise [0].
> Taiwan is not just TSMC. There are thousands to millions of things involving Taiwan you're likely not aware of and they might not even be AI or semi related.
>US backed off last year when there were talks about protecting Taiwan. They pulled Patriot missiles from Taiwan and South Korea too.
>US cannot blockade Hormuz, as we've seen. JP cannot do that with their current constitution unless they change it (the current government is on the road to it, though).
If China really wants to fuck with Taiwan, they had better do it soon while the most incompetent US administration ever to hold office is still there. Because there is change coming to the US and the next president isn't likely to be such a complete moron.
> Establish a total naval and air blockade of Taiwan using their fleets stationed in Ningbo and Zhanjiang.
I would not want to be maintaining a long-term naval blockade while constantly looking over my shoulder worrying about surprise attacks. Everyone knows where you are, and it would give plenty of time for a counter offensive to be planned. The US has something like 50 attack submarines, and a surprise attack from all of them at once would be a nightmare scenario for any fleet.
In the era of drones and missiles having your navy tied down in a blockade like that makes it all the more vulnerable.
US had all of that and still was unable to do anything meaningful around Hormuz.
US had 10,000 miles of power projection, while China prepared for 100 miles of it for the past 20 years, come on. The answer is EUV alternative that would render TSMC useless.
I understand that majority of people here cannot see the bigger picture, by design.
As an American, what are ways in which you can not defer to an authority - in a way that actually matters? Sure, you can choose to go outside dressed in gaudy colors, or not dressed at all if you are in SF. Or choose to flip the Democrat/Republican bit once every 4 years (usually without any effect on domestic or foreign policy, though not lately). But in a regular person's life, what authority do you want to opt out of? The average person can't do a thing about their HOA board, let alone a government representative.
> CCP is relaxed about core Chinese companies running their manufacturing in Taiwan
This whole idea of collapsing everything to some single semi-military geo-political concern is naive and not at all how the world works.
Of course there are people in China who would prefer Xiaomi did all their manufacturing inside China, and there are others who prefer to build stronger economic ties between Taiwan and China to make Taiwan economically dependent on China.
There are others who want Xiaomi to dominate world mobile markets by any means necessary. There are others who want Xiaomi to make the most profit possible, and still others who want Chinese firms to race to match US companies technology on every dimension.
These concerns are all interlinked and play out over years in lots of micro decisions.
China isn’t going to invade China until after we get our semiconductors up and running in Arizona for real
(because US won’t have to think about that situation ever again)
removing dependence imperils that island, CCP already has an EUV machine so the inevitable sanctions and export controls on ASML’s in Europe won’t matter either
It technically does not matter today. Sure the SOTA fabs only exist in a few places, but it’s not like a 2010/2015/2020 era chip is unusable trash. All of which are more geographically distributed.
For any critical workload a chip is considered trash after 5-7 years. They still run , of course, but increased incidents on platforms that are supposed to be 99.99 are hard to work with. Now if you mean there’s unused stock of those , that would maybe work, but I am not aware of significant unused stocks.
I agree, a move on Taiwan sets semiconductor industry back like 5 years at this point, down from what I’d say was 10 just last year
yeah equity asset values are going to tank but US will get serious about the supply chain immediately (which is already very much in progress), plus all the older nodes to alleviate some pressure off of the active compute demands
> The fact that the CCP is relaxed about core Chinese companies running their manufacturing in Taiwan might suggest that the CCP considers that it can make China and Taiwan one country, at a time of the CCP's choosing.
I'm not so sure. I would say that perhaps it's an indication that the CCP is ok with the status quo.
The PR Chinese might be able to take Taiwan's land, but they can't conceivable take Taiwan's economy, at least not by force.
> China and Taiwan are considered one country, even according to US
Your link does not say what you think it does. My guess is you read the first sentence and saw "one-China police" and stopped. But the US's one-China policy is not the same thing as China's one-China principle.
The US's one-China policy is that (continental) China is a single China governed by the PRC. It's silent on Taiwan. But, considering the laws we have on the books declaring our commitment to ensuring the sovereignty of Taiwan, it's a hard row to hoe to get to "the US considers Taiwan to be territory the PRC has a right to control."
The US has an unofficial relationship with Taiwan simply to shut the CCP up. It's like when your partner is complaining about something you did, silence doesn't mean you agree that you messed up. Sometimes it just means you don't want a fight right now.
>The 1979 U.S.-P.R.C. Joint Communique switched diplomatic recognition from Taipei to Beijing. In the Joint Communique, the U.S. recognized the Government of the People’s Republic of China as the sole legal government of China, acknowledging the Chinese position that there is but one China and Taiwan is part of China.
>The United States approach to Taiwan has remained consistent across decades and administrations. The United States has a longstanding one China policy, which is guided by the Taiwan Relations Act, the three U.S.-China Joint Communiques, and the Six Assurances. We oppose any unilateral changes to the status quo from either side; we do not support Taiwan independence
Doesn't sound like silence to me.
>But, considering the laws we have on the books declaring our commitment to ensuring the sovereignty of Taiwan, it's a hard row to hoe to get to "the US considers Taiwan to be territory the PRC has a right to control."
You're moving the goal posts. Sovereignty isn't the same as being a country. States in the US have some sovereignty and their own governance and international relations too, but it wouldn't be correct to say that the US consists of 50 independent countries.
Also, using the word right sounds a bit like muddying the waters. You could argue the United States government doesn't have the right to control their land, as it has been stolen from the indigenous people. But that doesn't mean United States is not an independent country that controls the area within its borders.
I'm unaware of any actual hardware backdoors introduced by primary manufacturers in practice, especially those installed in Xiaomi hardware.
There are accounts of interdiction and post-manufacturing compromises, such as those revealed in the Snowden leaks (2013) and most recently by reporting about the Israeli security services' sabotage of Hezbollah pagers and 2-way radios. These projects didn't expose primary manufacturers to the reputational and legal risk of association.
Until there's evidence of backdoors implanted by these companies, it's better to adopt a "trust but verify" approach and use standard layered security practices to detect intrusion. Conventional network intrusion and insider threat campaigns carry less risk of failure and are simpler and cheaper to execute.
I'm only aware of some software backdoors in Chinese devices, but times when you could've reverse engineered a chip with microscope are long gone. If there are any it would be really difficult to find them.
What would you consider as good evidence of a backdoor? Apple got plenty of media coverup for their part in Operation Triangulation, and even hardware experts were defending it as a fuckup rather than a backdoor, providing it with great plausible deniability. Do you count it as evidence? If not, I can easily see any other company leaving these non-backdoors in their hardware with no damage to their reputation.
Get off the short bus twin. CPU backdoors do no good unless there is cooperation with network driver code or the CPU itself has full operating system with a full network stack.
Intel's ME comes really close to that, but I don't think Intel's ME has drivers for every possible NIC and bus a NIC can appear on in its little Minix. So, just put a Broadcom NIC in a PCIe slot and leave the Intel onboard NIC empty, or LAN facing only.
Xiaomi may get Chinese 4G/5G baseband chip manufacturers to put in backdoors in Chinese phones, but they're not needed - the Chinese government pretty much already has total control of its Internet. For other countries, how are they going to make Qualcomm provide something undocumented CPU instructions can access.
My retardation status is unrelated to my statement. You assert there are top secret register values but without any evidence beyond your most recent psilocybin trip.
The existence of undocumented hardware behavior isn't proof of anything.
Hopefully the same pushback that has so far stopped the worst of chat control would help. But even if not having more western alternatives would be very welcome. If you're in the US it may not resonate with you, but as a Canadian currently reading ongoing rhetoric about being annexed by the US I'd love to have options if things continue to go south with the status quo.
It's good to be skeptical about how we implement the idea of a "root of trust" in these machines, but matter-of-factly characterizing ME and PSP as "backdoor" is misleading and not useful.
There's been 40 years of documented push back when western governments try to backdoor things - starting with clipper. Pushback is not always successful - but it's far more transparent then China.
Probably, but you are asking the wrong question: Is it legal to produce non-backdoored networked devices or services in China?
The answer to that question in the US is within epsilon of “no” thanks to the cloud act.
Europe and China have passed similar laws. However, China has a reputation for passing laws then selectively enforcing them. Maybe if you get on the right side of the right party member, the answer might still be “Yes” there.
Anyway, the next question to ask is: Who would I rather backdoor my device?
I doubt the Chinese government cares much about me, and unless I vacation there it’s an international incident if they, say, hack my car and murder me by aiming it at a tree at 95mph, like the CIA apparently does now:
Of course, the US government banned cars from China. Presumably this is because they do not have the mandated remote murder network port open, or, if they do, the US doesn’t have the necessary permissions to access it.
Those are both great examples. I think this doesn't obliterate my point, though it weakens it. The manufacturer in CVE-2026-11405 is already out of business, and the one in CVE-2026-66747 is unlikely to continue as a going concern.
Would Xiaomi or the CCP accept the reputational and legal risk of getting caught with a backdoor? Recall the CCP considered the arrest of the Huawei executive in Canada as an offense against itself.
Like a stopped clock, Fox News is right once or twice a day.
For instance election tampering in the US is a well-documented thing: However it almost always favors republicans in districts with electronic voting machines that do not generate paper trails.
As for the person you are replying to, their claims have been documented by most media outlets, places like wikileaks, and their claims are backed by US legal requirements to backdoor stuff (like the US Cloud act).
My opinion about Trump is as bad as the next guy's, but we still have better relation with the USA than with China. And it's not like we have much choice.
TSMC doesn't care what you put in your CPUs. Apple could tell them they want to build a CPU where 90% of the transistor footprint is for a new CIA Engine that takes pictures of your feet every three seconds to trace where you've been from the smell and TSMC's response would be "how many wafers do you want?".
I think Western people still call this situation “outsourcing” when in reality what is happening is that China is better at manufacturing than everyone else, and they’re starting to be better than everyone else at design and engineering, too.
When we buy software from Silicon Valley or a nice Mercedes Benz from Germany we don’t use this same language “outsourcing.”
Colloquially, outsourcing implies low quality or cheap price. No, what’s happening here is that China makes the best products in numerous categories and we are choosing to import them, because the best products are the most desirable.
Well at this point they are probably the only country in the world that can produce a car end to end starting from the raw iron ore and other elements up to the chips and software that runs on them (I’m sure they will still need to import some small stuff probably like Rhodium or Iridium maybe), who is going to compete with that? Everything done in country, no tariffs at all throughout the entire production cycle.
That said some of these industry especially metallurgical ones will never return to Europe or US as they basically destroy and pollute the environment on a large scale, in China that still seems acceptable but also might change promoting them to outsource to other countries which they already do in some areas I think.
I find it quite strange en people take a development that has happened over the last ~50 years, little more than half a lifetime, and confidently state that now "it will always stay like this". Things always change.
Imagine what those kinds of people would have said in China in the 70s, with western industries being vastly more advanced and efficient. "It's over, we will never catch up." they would probably have said. Wrong then, more wrong now.
China has made a tremendous effort to move to a clean(er) industrial system, using a lot of renewables and clean energy and improving environmental standards. At this point production in China is probably the best for the environment compared to most countries, including the US that is deeply invested in oil production.
China evidently is pushing to move to sodium ion batteries. They didn’t have to. They could’ve stuck with lithium. I’ll let you guess what what would’ve happened in the United States they would’ve said we don’t have to this lithium already works. Why do you want to upset the Apple Cart.
They are also moving close to a point where they will bring Thorium Reactors on line they don’t have to. They could just stick with uranium, but they’re not.
Is this part of the fact that they have engineers running a lot of of the things at the top of their government instead of lawyers?
They seem to be building a lot of infrastructure they are in the process of building several dams on the Brahmaputra River.
But we do have to consider how the speed in which it is dropping. China uses about the same percentage of fossil fuels for energy production as the US right now, but more of it is coal so it is dirtier. However they are aggressively installing and promoting renewables and nuclear power, built themselves, and their pollution standards are rapidly increasing. While in the US renewable and nuclear investment is and has been pretty crappy.
The fact that China is not that far above the US while being the world's factory and having 4x the population is pretty impressive.
And like you said, China is putting a real effort in. I don't see the US trying to reduce domestic short hop flights with electric high speed rail. I don't see the US trying to replace gasoline cars with EVs. I don't see the US curtailing structural incentivization of pickup trucks and SUVs.
The main US policy seems to be "spend trillions on wars for oil" rather than accepting the inevitable decline of oil and planning around it.
This comparison is meaningless because China is the worlds factory (including a major portion of what's consumed in the US ). So that CO2 number is their populations usage plus what's required to manufacture good for the most of the world. A huge part of US CO2 consumption has been outsourced to China.
The west is interested in funneling most of the money to the top no matter what for the last 60 years that has been the drum beat/cry It can’t be done. It can’t be done.
In America, there is one fast food place that does it differently than everyone in the market they don’t franchise and they don’t lease/rent.
They own everything as they expand (the land and the building), which means it’s a little bit slower when you expand, but they don’t care but they are very profitable.
The owner probably gets a call every other week from large equity companies trying to sell them on doing it like everybody else and their pitch they can make you a worldwide company if you just let them in to f you.
Common misconception. They don't franchise in the sense everyone normally means it. They call "managing the store" a franchise.
If you "franchise" a CFA, you don't own the store, you don't own the land, they severely control your income, you are required to physically work at the store (in other words, they control you as a laborer), and you can't re-sell the franchise since you don't own it. You have no equity. They refer to you as an operator.
When you leave the business, CFA picks someone else to give it to. You get paid nothing because you never owned it.
They're also very weird in picking their operators. I can't speak for every CFA, but where I live all the operators are white evangelical Christians. This is probably a side-effect of CFA's policy of not letting anyone who has debt be an operator, and buying everything without financing is a big thing in the evangelical Christian community thanks to Dave Ramsey.
I've had my thinking in this area shift, too; I now believe China (and a few other places, like Vietnam) have "won" at manufacturing because their combination of government, cultural values, and the masses of their people from which they draw workers, managers, and owners simply are better at manufacturing than my own country is.
Part of what led me to believe this was waking up and realising they're also simply better at offering LLM inference: cheaper; faster; more innovative.
It's a horse of a very different colour from outsourcing where someone is simply chasing the lowest bidder.
> I think Western people still call this situation “outsourcing” when in reality what is happening is that China is better at manufacturing than everyone else, and they’re starting to be better than everyone else at design and engineering, too.
The media to this day portrays China as if it was 80s. Yes, at that time it was an open-air manufacturing plant. You can run rudimentary floor operations with high school educated workers, but you still need trained engineers and managers to run the operations. Exporting engineers quickly became impractical, which led to local engineers getting trained. At some point the training became the bottleneck so local educators were trained. And so on.
Over the years, China has built the entire industrial pipeline: all the way from education and vocational training, to scientific research, to local engineering houses. Remember, the people who built Shenzen are now retired. Or to put it into perspective, China is currently at roughly similar age of industrial boom as post-WWII USA was in... the late 90s - early 00s.
"The West" had a head start with regards to IP and China is indeed fighting an uphill battle there, but they have a huge domestic market to grow the companies out. The proud "Designed in X, made in China" things are being replaced with white-label "made in China", where "designed in China" is implied.
Do you have a robot vacuum? It's probably Roborock / Dreame / Ecovacs, not even some western branding.
Fair point. Outsourcing was not the right word to use, China today makes products over all quality ranges and almost always they are cheaper than any other alternative. “Giving away” would be a better word.
We leave a large part of the question of where things should be manufactured to the market. If the market decides that the place is China it's probably because they think it's individually beneficial to them, not an act of charity.
The point is that we aren't "giving away" manufacturing to China. We've already given the choice of where to manufacture to the free market, which then turns a profit by buying their manufacturing services from China. I don't see a good reason to construe it as anything else.
> I think Western people still call this situation “outsourcing” when in reality what is happening is that China is better at manufacturing than everyone else, and they’re starting to be better than everyone else at design and engineering, too.
I feel you're trying too hard to make believe this is somehow unexpected or unnoticed. The fact that subcontracting work to external companies acts as an investment on said companies to develop skills and competences is something that is known since always. The argument that the reigning VC mentality is that this investment is an acceptable tradeoff due to reasons such as these investments being limited to non-critical business concerns.
China didn't get that way by magic. They ran the same playbook that allowed Alexander Hamilton to snatch manufacturing from Great Britain to the US, and the US gave up manufacturing for the same reason the UK gave up manufacturing (suppression of labor interests).
It will be interesting to see what China does. They aren't ideologically committed to exclusively serving the interests of the wealthy, but they still have lots of rich people in the (ahem) Communist Party, so who knows.
It's striking that they recently arrested one of the richest men in the country, the Evergrande founder, for fraud. Seems unthinkable in the US/Europe right now.
Some of Evergrande's financial practices were somewhat ponzi-scheme-ish (new sales funded construction of previous buyers), and the US has imprisoned a few such schemers too.
The people in China that made the decision on that antifreeze in toothpaste, and the 300 pigs in the river or that graffiti tower in Los Angeles across from the Staples Center. I don’t think those people walked.
That is not to say that in time they’ll start to do many of things that happens in the west where those at the 1% or 2% walk away, in time China may drop down to that level, on the other hand, I would like to believe the United States will start to have the same reaction that the country had when Sputnik went around the Earth and change course and I don’t mean sanctions, tariffs, wars, and threatening neighbors to the north and to the south.
The right way to read this isn't that all billionaires can face consquenecs, but that the line that makes sure you don't face consequences is quite a bit different than being a billionaire. You can still have a power center, and impunity, as long as you make sure your misbehavior doesn't embarrass the people with the actual power. Those are smart enough to not do the things they shouldn't in a way that can be made public, and therefore cause said embarrassment.
One can prefer a regime where it's very hard for people who abuse their power to avoid punishment if it's all public to one where the powerful are emboldened enough to be able to be shameless. Even worse when the shamelessness is seen as the purest display of power, and thus people compete in their public misbehavior. But still, understand that the real barrier to punishment in the first case is not to avoid doing bad things, but to make sure that the witnesses either don't exist, or are too scared to say anything.
A judicial system that actually has no sacred cows would be better in all cases, but the sacred cows everywhere do their best to make sure this doesn't happen.
A few years ago I would have comfortably agreed that the US was better at impartial justice and justice for all. That has changed. Now it's a game of making lists of sins and comparing them -- which has enough degrees of freedom that everyone is just going to come to whichever result they were aiming for.
In the west, billionaires are often able to get extremely favorable treatment by the law as an expression of the power money gives. This is not the case in China, in which the party stands at the top.
In practice that's just a difference of incentives that I'm not sure at all is beneficial for anything but an authoritarian regime.
I mean, Deng Xiaoping is/was a huge influence in _our_ lifetimes. It was only the 1970s, just fifty years ago, when he was effectively the head of state. That’s like yesterday. I’m not saying Hamilton doesn’t have the influence you’re describing, but it’s not really an equal comparison given the huge difference in timeframes. Late 1700s is a ways away vs the 70s.
I think it’s a matter of perceptions catching up to reality. 15 years ago China was definitely still ripping off american products down to the english silk screening.
Maybe new companies can spring up and be competitive with AI assisted design. Im assuming the cost was too high for those old companies to survive right? Small nimble companies could theoretically compete in some segments vs large bloated slobs (even if they have AI as well). This is all just hypothetical thought.
> However I am sad that the world interdependence is eroding (...)
That's quite the odd statement. I don't think that it's in anyone's best interests to have a single country control access to chips. It might be in the US's interests to keep everyone out if the field, but the US is a single country among 195 countries.
And isn't the US's dominant ideology all about competition?
This is what was sold to – and often forced on – countries by the US and their allies via the IMF and World Bank. Global free trade meant that you only produced what you had an advantage in and bought what others could produce at lower cost.
I think describing what's happening "other countries seem to sit on their hands and happily outsource every bit of manufacturing to a single country" is disingenuous. It's been dubbed China Shock 2.0 and it's being taken very seriously by the EU. The US admin is a joke and too busy shooting itself in both feet to have coherent policy
Gdp grew much faster in the US than in the EU. I believe the EU is the worst performer of the planet. No joke. And not surprising with the self destructive actions.
Sure, GDP in the USA is growing faster than the EU, but the question is who is benefiting from the increased GDP?
The answer is in Dah00n's comment. The rich are getting richer, while the population gets scraps. Meanwhile, people in the EU get guaranteed healthcare, paid time off, maternity leave, better worker's rights, etc.
> Meanwhile, people in the EU get guaranteed healthcare
They had that 20 years ago? Since then the rich asset owners have been accumulating a bigger share of the pie in the EU as well, it’s just marginally less pronounced because there is less wealth to go about in the EU due to the multi-decade long stagnation (outside Eastern Europe and a handful of other countries). On the whole I find it extremely hard to view this as a positive without a huge amount of wishful thinking.
People in the EU need to start thinking about how to improve things rather than exclusively focusing on holding onto what they already have (which is slowly turning into scraps..). To a large extent the old EU countries just froze in time after the GFC.
The GDP growing faster while quality of life doesn’t meaningfully improve is a bad, bad sign. It means we’re burning extra money just to stay afloat and break even. That’s worse than if the GDP didn’t grow.
The EU is doing just fine economically. It's a great place to live which matters much more than money. Also, the US has 40 trillion in debt. Every taxpayer owes $280k.
The EU is not perfect and recently they took a turn for the worse with shit like ChatControl and the ppwr killing small businesses.
But economically it's not a problem. It's not a race to be the richest, though America always makes everything a contest. We just need enough to live comfortably.
Because as everyone knows, GDP is _the_ indicator for well being of its citizens. Nobody in the US is in catastrophic health related debt, because the US's GDP grew so much <3
The median person and especially those in the top 10th percentile are fairly well off and respectively extremely well off in relative terms compared to people in other developed countries. To bottom deciles are of course not in the best situation but for the most part the rest of the population find it fairly easy to ignore that.
Western Europe has been mostly stagnant or declining while real incomes for most workers have actually grown in the same period (and for a significant proportion of the population to a very large degree).
That might be a mirage temporarily made reality by outsourcing defense to the US, manufacturing to China and the work required for GDP growth to refugees.
How is locally producing military equipment versus buying extremely expensive US uberl33t overkill hardware suppose to hurt the EU? It not like the US was just giving Europe free armaments.
Yeah sure they won't be producing any F35s or million dollar per shot missiles, but was that a good idea to start with? Are they worth the money when once again lots of inexpensive arms are shown to be more useful in modern wars than a few handfuls of expensive ones? Both Iran and Ukraine have shown that one side being a few steps ahead in military technology and willing to dump money on equipment still has limited returns. There is no "I win" technology apart from indiscriminately killing most of the entire population, which just makes you an existential enemy to the rest of the planet and erases 95% of the value in taking that territory.
Its really not that obvious to you? Because not having US bases on site and technology sharing and agreements takes money away from entitlements. France tried to cut entitlements by a tiny bit and the yellow vest movement was born. In the long run the Yellow Vests might end up losing everything as a result.
Regardless of the tech stack the work still needs to be done and now the EU has to do it. The Eu does not have infinite money, in fact they have less than the US so there will be cuts elsewhere.
Before outsourcing defense to the US... sorry, but have you ever read a history book? Europe was "exporting defense" around the world before the US got involved in the world wars :-))
Before outsourcing manufacturing to China Europe was making a third of all industrial things on this planet, so Europe will be just fine.
> the work required for GDP growth to refugees
I don't get this one. Do you think the European economy is propped up by refugees? I think there are 5 million of them in total in Europe, most of them Ukrainians and it's likely Ukraine will become a EU member at some point in the future...
>Before outsourcing defense to the US... sorry, but have you ever read a history book? Europe was "exporting defense" around the world before the US got involved in the world wars :-))
And they will continue to do so. Just at a higher cost with no US to maintain bases and do technology cost sharing. That extra money has to come out from somewhere...it will be entitlements. Combine that with terrible demographics and that remaining manufacturing base will be built on a bed of sand. :)
>Before outsourcing manufacturing to China Europe was making a third of all industrial things on this planet, so Europe will be just fine.
Europe can insource everything that China makes. They are not stupid people. You mistake the benefit westerners got from outsourcing. It held back inflation in products because the value came from the living standards difference between chinese and EU people. Remove that disparity by bringing back everything and EU will be living with a lower quality of life because all those products will be significantly more expensive with no alternatives.
>I don't get this one. Do you think the European economy is propped up by refugees? I think there are 5 million of them in total in Europe, most of them Ukrainians and it's likely Ukraine will become a EU member at some point in the future...
Same point I have been making. The consequences of demographic collapse can be hidden away by having young tax paying peoples do the shit jobs that run the economy at low wages. Same thing the US does with illegal migrants. Remove that and the hidden costs are now dumped onto the population. Result: Lower living standards for those who remain.
If they did, they would have done it already. Instead when there was an attempt, some protested wearing yellow vests. There will be more. Whether or not the governments force the issue or they lose to the voters does not matter: Either way quality of life will suffer.
It's not reversing, it's continuing the trend of more and more manufacturing moving to Chinese companies. It already happened to TVs and it's currently happening with RAM.
Xiaomi may manufacture their chips in Taiwan (by tsmc) but Xiaomi is still a Chinese hardware company, similar to how Apple or Qualcomm are US American hardware companies.
No. The problem is that TSMCs new capacity is already hogged by AI peddlers for years to come (in fact, AI BS is the reason why these new non-Taiwanese fabs got the massive US and EU subsidies), and so everyone else not flush with cash from the AI hypetrain has no alternative than to go to China - and deliver all their secrets to the CCP.
And eventually, just like the Western solar, battery, pharma and car companies all have learned, the CCP will use that knowledge to surpass and undercut everyone else.
Do they also deliver all their secrets to US/EU/Taiwan/etc or is it only with China that it goes from ordering some products manufactured to "deliver all their secrets"? Strange how almost everyone points their fingers at the CCP when we know for a fact (hey Snowden etc) that the US does what we say we think China does. I guess China bad > facts.
Countries and institutions should always produce things where they are excellent at producing, in forms of specialization and compete in terms of comparative advantages.
Yes, and no. Yes because you are vulnerable to supply chain disruption by illwilled countries. But illwilled countries that disrupt supply chains greatly incentivise others to diversify supply away from them.
China could have the monopoly of rare earth production and refinery for all of eternity. But because of their reaction towards all the us allies when the us increased tariffs, I don't expect them to be relevant enough to disrupt markets with rare earths sanctions in 10-20 years.
Only if you have the people to do it. China has some of the worst birth rate in the world. In ~20 years that manufacturing capacity either goes to robots or goes away. Then what?
One of the (many) areas in which China is doing great is industrial robotics. Not the fancy dancing dogs, but robots that replace workers in factories.
That why I said it either goes to robots or it goes away. Can the current robots replace something like this? I don't think right now but maybe they figure it out.
That factory looked like it employed a lot of easily replaceable manual work.
You don't have to replace 100% of workforce, replace just the ones whose work is the easiest to do by a robot.
Replacing 50% of workforce buys you enough time that by the time your available worker pool has shrunk 50%, robotics and AI will be much better and you will be able to replace another big chunk.
Production-wise, shrinking demographics are not such a big deal (they still have a lot of youth unemployment).
Shrinking demographics is a problem due to
a) the ratio of workers vs seniors,
b) shrinking overall demand pool -> shrinking economy
c) smaller overall talent pool -> less diversity, less 'geniuses', i.e. the real drivers of innovation, and less capability to mobilize for great projects
You haven't seem to have accounted for costs. Can the speaker still be produced at the same price? It remains to be seen. A lot of products will simply go away due to economics. Thats a reduced quality of life compared to today.
I didn't watch the entire video, but 90% of the tasks I've seen in that video are easy to automate. The hardest ones are the cable pulling, putting the coil on the insert and soldering directly on the conveyor belt.
It remains to be seen if that bluetooth speaker can be produced with advanced automation at the same price that they are selling it for at this time. If not, parts or the entire category of product (tiny LED bluetooth speaker) might just have to go away as it does not make sense economically anymore. That is the reduced quality of life I am talking about in the other comments here.
Yeah China bought out Kuka a while back and have done some amazing efforts in automation. Their pragmatic approach to AI and automation may win out in the end. We will have to wait and see.
Rest of the world does not rely on manufacturing as a large chunk of its economy. Yes it will be painful for all, entire classes of products might just go away if they dont make sense in the new inflationary environment but countries will still likely suffer less than China overall.
While I agree in passing. I think saying you'll export all your work to places with worse labor laws is short-term thinking. Chinese companies are successful yes but they also don't necessarily compete fairly. We still can export large portfolios of goods to China. So to just say they are best because they have a government protected market, plus subsidies so we should abandon local is a bad optimization in the long term
This is so stupid. China itself uses the "dominate and corral" model for their industries, and had severe tariffs to grow their various industrial bases, such as automotive.
Except they've now ground your native industry under their boot and have total monopoly control because you've given up your critical infrastructure. You can no longer stop buying. That isn't an option.
This is geopolitics 101; your fantasy version is decades out of date.
Was it bad when it was the US doing it against the UK? Or is it only when the people doing it eat more rice than us that it is bad? People said the same thing about the Japanese (they steal designs, they copy, it is bad quality, they are stealing our jobs, and so on).
>Or is it only when the people doing it eat more rice than us that it is bad?
It's definitely different when the player doesn't even have to play by the market. Comparing US companies and Chinese companies is not apples to apples.
I will agree that dumping is probably just bad overall. But the US, and much of the rest of the world, allows it to happen both within and outside of their countries, sometimes even financially supporting it with government programs. So I really don't see why I should care that someone in China is doing it. We can't hold others to standards significantly higher than we hold for ourselves.
And good news for everyone else.