How to Outcompete Chinese State Capitalism

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  1. Ken Burgess profile image73
    Ken Burgessposted 3 weeks ago

    Years from now, the summer of 2025 may be remembered as a turning point in U.S. industrial policy, with President Donald Trump’s deals with Intel, Nvidia, and MP Materials marking the beginning of a new era of direct state investment in key industries.

    As the United States competes over the technologies and industries of tomorrow, Washington is now experimenting with state-centric investment strategies that resemble those of Beijing. But because the U.S. federal government is constrained by a debt-to-GDP ratio above 120 percent and a budget deficit exceeding seven percent, U.S. policymakers will have to channel more private capital toward strategically important sectors. Doing so will not be easy. To ensure a successful industrial strategy, the Trump administration must set clear criteria for what qualifies as a strategic industry, marshal the necessary public resources, and incentivize private investment in those industries.

    The global battleground spans a wide variety of industries, including artificial intelligence and related digital infrastructure, critical minerals, and advanced manufacturing. Both China and the United States have advantages and disadvantages in this strategic competition. In China, the government plays a central role as a source, allocator, and user of capital, directly resourcing strategic priorities but creating significant waste and inefficiency in the process. Chinese companies get much of their financing from state-owned banks, with capital markets providing only 14 percent of their financing.

    In the United States, by contrast, a market-led approach struggles to support less lucrative areas of strategic importance, such as basic infrastructure, but excels at directing capital toward areas with the highest perceived returns, such as artificial intelligence. And with integration across all 50 states, U.S. capital markets are the largest globally and provide nearly three-quarters of all equity and debt financing for U.S. companies outside the financial sector.

    In both countries, investment outcomes depend heavily on national conditions, including the strength of capital markets, workforce, infrastructure, and the judiciousness of laws and regulations. When these conditions are strong, countries become magnets for foreign capital and talent. As U.S. policymakers work to scale investments for strategically important technologies and industries, they may improve underlying conditions over time, but they should not bet on overnight transformations.

    THE VISIBLE HAND
    The Chinese government has an extensive toolkit for supporting investments at home and for launching into global markets. State-owned banks provide most of the financing to companies in China, which is home to the world’s four largest banks, all of which are state-owned. The government is also the dominant investor in venture capital and private equity, supplying six times more funding than private investors. Chinese companies can draw from a wide array of state-backed sources, including funds, banks, enterprises, and sovereign wealth vehicles.

    Beijing also shields firms from foreign competition, facilitates technology transfer, and supports them with cheap land, electricity, and credit. Abroad, Beijing extends financing and diplomatic backing to Chinese companies through the Belt and Road Initiative, helping them to secure mineral rights and logistics networks.

    The rise of China’s largest shipping company, COSCO, illustrates the power of this support. In 2009, COSCO operated three overseas terminals. Today it manages a dozen. In that same period, the company increased the amount of overseas cargo it handled tenfold. Many other Chinese firms have profited from COSCO’s success, including manufacturers of tankers and liquefied natural gas carriers, financial-technology and mining companies, and entrepreneurs developing AI applications for maritime operations. This broader Chinese ecosystem of beneficiaries allows the state to rationalize its continued support for a national champion.

    When all else fails, the Chinese government can move capital from profitable state-owned enterprises to keep their struggling counterparts afloat. The relative success of Beijing’s Made in China 2025 initiative, which Chinese President Xi Jinping launched in 2015, is telling. Displaying a degree of focus that Washington has lacked, Beijing aimed to upgrade not just industry in general but ten specific sectors. Within those sectors, Beijing has achieved global leadership in five of 13 key technologies and is making headway in seven others.

    Yet this approach carries costs. China’s subsidies, which are far larger than those of other countries, have created overcapacity in automobiles, solar panels, and semiconductors. Correcting this will be difficult as growth slows, the Chinese population ages, and reliance on foreign energy rises. In addition to draining resources from competing sectors, Chinese subsidies have provoked other countries to respond with their own measures, as evidenced by Trump’s tariff policy.

    The heavy hand of the state is also driving investors away. Foreign capital, especially venture funding, has collapsed amid higher risks and lower returns. Beijing has tried to lure investors with regulatory flexibility and even a $138 billion public venture capital fund, but domestic private firms still prefer private sources, and government-owned investment firms perform worse than private ones. Still, when strategic priorities are at stake, Beijing values control over efficiency.

    THE NEW DEALS
    Trump’s recent deals with Intel, Nvidia, and MP Materials may represent a significant escalation of a nearly decadelong shift toward experimenting with industrial policy. In his first term, Trump fired the opening salvo with his “America first” strategy based on a mix of tariffs, import substitution policies, and attempts to improve infrastructure. President Joe Biden increased some tariffs on China and worked with Congress on landmark programs to rebuild the United States’ aging infrastructure, invest in clean energy, and develop semiconductors and related technologies.

    In his second term, Trump has deployed a variety of tools to attract more capital to strategic areas. He has used executive orders to relax regulatory barriers, continued to provide financial incentives—such as tax benefits, grants, loans, and guarantees—for semiconductors through the CHIPS and Science Act, and blocked or raised the cost of foreign alternatives, including through aggressive import controls and tariffs. His administration has also taken dramatic steps to leverage the U.S. government’s power as a customer and regulator to strike deals with private companies. Some of these measures are reminiscent of the New Deal, when the federal government actively invested in the economy.

    In April, the leading AI-chip maker Nvidia announced that it would spend $500 billion to build AI supercomputers and infrastructure in the United States, including new manufacturing and testing facilities in Arizona and Texas. In return, Trump committed to speeding up permits for Nvidia’s expansion. Then, in July, the Department of Defense launched a partnership with MP Materials, the rare-earth miner, to build a fully domestic rare-earth magnet supply chain, with the aim of reducing U.S. reliance on China for critical defense inputs. The deal includes a $400 million equity investment by Washington (making the Department of Defense the company’s largest shareholder), a $150 million public loan to expand heavy rare-earth separation, and a ten-year price floor on a rare-earth compound that is a key ingredient for powerful magnets. This combination of incentives has already mobilized $1 billion in financing from JPMorgan Chase and Goldman Sachs, as well as a pledge from MP Materials to contribute $600 million to the project. The real test will be whether the partnership can meaningfully scale up production and create a self-sustaining market over the next decade.

    The strategic case for more recent deals is less clear. In August, Washington announced that it would allow Nvidia and Advanced Micro Devices (AMD), another leading semiconductor company, to export certain AI chips to China in exchange for 15 percent of top-line revenues generated from these sales. The Trump administration has not clarified how it plans to use these funds, which makes it impossible to weigh the revenue gained against the potential costs to national security. In an unprecedented move, the administration also recently announced that it would use $5.7 billion in previously awarded grants to the chipmaker Intel to purchase a ten-percent equity stake in the company. By converting a grant to an equity stake, taxpayers may benefit from future returns—but Intel may be at a disadvantage, since its competitors will likely continue receiving grants and other less demanding support.

    These actions can be interpreted in two ways. First, they reflect Trump’s transactional style of policymaking. Second, they could signal the start of a more sustained industrial policy focused on supporting strategic sectors, both at home and abroad. The first does not preclude the second. But an ad hoc approach risks failing to achieve the scale and consistency necessary for long-term success.

    FOR THE LONG HAUL
    The long-term nature of industrial policy is perhaps the greatest challenge for the United States, where elections carry the risk of erasing a previous administration’s policy initiatives. An effective industrial policy for strategic competition across multiple technologies and industries—including those that have yet to be discovered—may have to be extended for decades. Moreover, whatever policy takes shape over the coming years, U.S. public resources are limited and risk being spread too thin over too many priorities. It is critical that policymakers continue to identify strategic industries that require targeted state support and ensure that the United States has the capabilities, either domestically or through its network of partners and allies, to defend its vital interests under various scenarios.

    To that end, policymakers should ask several essential questions before making investments. Does this industry require support that capital markets cannot provide? If so, what form of support should it take? If financial support is truly required, which tool will have the greatest likelihood of success at the most reasonable cost? Should the state intervene directly in private capital markets or merely provide incentives? The government has a number of incentives from which to choose—tax benefits, grants, loans, and guarantees, as well as its own purchasing power—and each comes with tradeoffs. These questions should be standardized and addressed systematically through an investment vehicle, such as a sovereign fund, with rules that insulate decisions from political interference.

    A related challenge is identifying the critical ancillary requirements that strategic industries need. For example, AI requires massive data centers, which in turn depend on reliable power generation, water resources, and permits at both the local and federal levels. States cannot fund these requirements alone. The 2021 infrastructure bill, for example, was almost entirely funded by federal and state governments, with minimal incentives for the private sector. A realistic industrial policy must also consider the supporting investments—in research, infrastructure, and workforce development—that are necessary for strategic industries to succeed.

    Policymakers should also continue nurturing the United States’ underlying advantages. Capital markets could be further strengthened by lowering the tax burden on foreign capital from trusted sources seeking minority stakes in U.S. infrastructure and other priorities. And comprehensive immigration reform is essential to ensure that the United States has the human capital required for industry and for maximizing the odds that the next strategically important innovation happens at home.

    The United States can lead in tomorrow’s technologies and industries by leveraging its unparalleled capital markets, fostering public-private collaboration, and aligning policy incentives with long-term strategic goals. But success will require disciplined prioritization and a commitment to creating conditions that attract both domestic and international private capital. As global competition intensifies, Washington’s ability to mobilize private capital will be central to safeguarding U.S. strategic interests.

    https://www.foreignaffairs.com/united-s … -advantage

    America’s Private-Capital Advantage
    Sadek Wahba and Jonathan E. Hillman
    September 4, 2025

    Interesting Article... thought it was worth sharing.

    1. Credence2 profile image82
      Credence2posted 3 weeks agoin reply to this

      Yes, it is a well written article. The gist of it is that akin to Chinese economics, the government is going to take a greater role in development of strategic industries, government investment in anticipation of a return from recipients. So, aspects of China’s command economy techniques and neutralizing the advantages of key Chinese industries being financed by their government, the US proposes to get into the game. So, the idea of laissez faire in regard to the time honored idea or government staying away from much of the private sector business interests is to be a thing of the past.

      Interesting, but for Trump’s sake he is going to have to deliver visible progress and do it soon.

      1. Ken Burgess profile image73
        Ken Burgessposted 3 weeks agoin reply to this

        That article... along with some research I have done on China's current economic conditions... and watching this for a few moments:

        https://www.youtube.com/watch?v=aFKtxcImgAs

        Actually... I wanted to show the actual parade (which I had watched) but this breakdown is more informative.

        America has a serious problem... separate from our party politics, social issues, etc.  because of how open America is... we have had years, decades, of interference in our education, politics, policies... China, Russia, Saudi Arabia, individuals like Soros and most recently Musk.

        We have poo-pooed the fact that Hunter Biden's financial firm received 1.5 Billion from one of China's banks for investments or going much further back that Bill Clinton got billions from Chinese businessmen when he was running for President...

        Americans are barely aware of how influential/involved China became in many Universities until there was a recent halt to those activities... or how much of technology (computers, cell-phones, Apps) China has built backdoor spying capabilities into.

        China is a closed and very controlled nation compared to us... the ability for them to transform themselves from nothing... literally 35 years ago British controlled Hong Kong had a greater GDP than ALL of China... and today China has 10 Hong Kongs and has a greater GDP than any other nation in the world... has more Industrial capabilities than any other nation in the world... and has positioned itself to be more important to the majority of the world than America is today.

        If we are going to be able to survive... to have some semblance of the economic prosperity we have long enjoyed... and for too many years now borrowed against... serious changes need to be made...

        That is why we are more divided than ever I believe... the Nation's enemies are using our weaknesses against us... from Social Media to corrupt Politicians... financially supporting any group or activity that will further divide the American people and have them fighting one another.

        This was never possible in the past... technology has allowed the worst we have to offer to be upfront and present... in our faces... at all times. Unless you tune it out, it will consume you.

        China doesn't allow its Social Media or Internet to be used in such a way.

        China has kept its people united and focused on surpassing America at all costs.

        1. Credence2 profile image82
          Credence2posted 2 weeks agoin reply to this

          Only thing about that, Ken, is that China is an authoritarian dictatorship. I don’t know if I want to sacrifice a rule of law, democratic society as the price to pay to get hegemony over China.

          This is a democracy, at least for now, China is not. I like democracy…..

          I understand your concern, but imitating China and its society is not it.

          1. Ken Burgess profile image73
            Ken Burgessposted 2 weeks agoin reply to this

            I'm not sure you are sacrificing the "rule of law"... I am sure China is a nation run with the "rule of law" moreso than our own.

            I don't have any real solution per se...

            But if we don't find a way of becoming better than them at many things, they will surpass us, and eventually they will dominate the globe... and in turn we will be at their mercy just as most of the world has been at America's for many decades.

            Democracy or not... our Nation has lost its way... is losing its ability to compete... to pioneer... and I would argue is failing to follow and uphold the 'rule of law'.

            1. Credence2 profile image82
              Credence2posted 2 weeks agoin reply to this

              Perhaps under the circumstances, Ken, it is time to move expat style to Europe, Portugal or Switzerland seems nice.

              1. Ken Burgess profile image73
                Ken Burgessposted 2 weeks agoin reply to this

                If I had the type of money that all those bigtime hollywood types have that always threaten to move... I would do so without hesitation... Switzerland is not a bad option... Slovenia or Slovakia might do the trick as well... some place where a majority of people can speak the english language.

              2. Ken Burgess profile image73
                Ken Burgessposted 13 days agoin reply to this

                MG Singh just wrote an insightful short article on the Rise of China...

                "Matters were not helped by the advent of Joe Biden as president. Apart from being incompetent, he was also alleged to have shady deals with the Chinese. Donald Trump became president in 2016 and appreciated the danger of a resurgent China, but he was defeated in 2020 by a combination of circumstances,

                Donald Trump came back as president in 2024, but now the situation had greatly changed, and the Chinese were calling all the shots. They had a trade surplus of almost $400 billion with America, and apart from military hardware, the Americans are producing nothing else. Trump wanted to reinvent the United States and bring back manufacturing, but it is an uphill task, and he's already facing a tremendous backlash.

                Matters have not been helped by the decline of Western Europe as a global power. The European powers have lost their colonies, and with very few natural resources, have seen their great power status slipping from them.

                Another facet of global politics is the alliance between Russia, China, and North Korea, with Iran on the sidelines. Donald Trump has realized that this is a formidable combination, and he has no support. Japan is in the same boat as the European powers, while India is sitting on the fence.

                The Chinese have put their expertise to good use and made use of all the trade and investment that America had given, from copying goods to doing reverse engineering of sophisticated equipment to bridge a gap of five decades within two decades. "


                It seems he sees things very much like I do... which I believe strengthens my own expressed opinions of the situation, as he is seeing it from outside the U.S. and from a very different perspective.

                I typed this just last night in another reply, to you:

                "...I was fairly certain Biden was in China's back pocket and when you look at the totality of events that occurred during Biden's four years, things couldn't have gone better for China and worse for America and the EU.

                Nations that were once allies were scared into the arms of BRICS... The seizing of Russian assets, the sanctions, the war effort... Nations said to themselves if America can do that to Russia... What will stop them from dng that to us?

                Once that ball got rolling down hill and nations started lining up to join BRICS there is no stopping it... "


                So yes, like the rest of the world I believe China was blindsided by the election of Trump... or more to the point, Trump outing them as the threat to America's wellbeing that they were... recognizing that things had to change quickly if America was to maintain a top position on the global stage.

                China had a friend in Biden... who said one thing to the American people... while every decision made by his Administration strengthened China and harmed the United States and its allies.

                The war with Russia is the starkest example of this... but reversing direction with Iran and lifting sanctions on them, releasing funds to them is another... Iran not only funds the Houthis, Hezbollah and Hamas... but they are nothing short of a satellite state to China.  Most of Iran's resources are directed to China, under Trump, he had restricted the oil flow to China from Iran... that reversed massively the day Biden took office.

                Biden insulted and harassed the UAE so much they no longer trade oil in the Dollar and were in line to join BRICS almost immediately... they joined it officially in 2024.

                The list of things done during Biden's 4 years to harm American interests and the American people is inexhaustive and one could literally write a book on how harmful his administration was... on every level.

                So harmful, it will be a miracle if things can be turned around... if America can find solid footing and snatch victory from defeat... economically, globally, and within as well... socially and culturally.

    2. profile image0
      tsmogposted 3 weeks agoin reply to this

      Information (Keyword) is powerful. Thanks for the opportunity to 'learn'. I have enough of a base in business / finances to gain enough insight that what was offered was just a taste, a morsel of a feast perhaps discovered in the books authored by the two contributors to the article. Those book titles alone offer clues.

      For now, two things stick out in my mind as I reflect. They are the two opening paragraphs following:

      THE NEW DEALS
      Trump’s recent deals with Intel, Nvidia, and MP Materials may represent a significant escalation of a nearly decadelong shift toward experimenting with industrial policy. In his first term, Trump fired the opening salvo with his “America first” strategy based on a mix of tariffs, import substitution policies, and attempts to improve infrastructure. President Joe Biden increased some tariffs on China and worked with Congress on landmark programs to rebuild the United States’ aging infrastructure, invest in clean energy, and develop semiconductors and related technologies.

      and,

      FOR THE LONG HAUL
      The long-term nature of industrial policy is perhaps the greatest challenge for the United States, where elections carry the risk of erasing a previous administration’s policy initiatives. An effective industrial policy for strategic competition across multiple technologies and industries—including those that have yet to be discovered—may have to be extended for decades. Moreover, whatever policy takes shape over the coming years, U.S. public resources are limited and risk being spread too thin over too many priorities. It is critical that policymakers continue to identify strategic industries that require targeted state support and ensure that the United States has the capabilities, either domestically or through its network of partners and allies, to defend its vital interests under various scenarios.

      Time to make my coffee to kick start the day while I allow what was read to linger gracefully as I listen to the percolating Mr. Coffee do its job.

      1. Ken Burgess profile image73
        Ken Burgessposted 2 weeks agoin reply to this

        Very good point.

        It is exactly what we have seen the past decade.

        Soon as Biden was sworn in, they went to work day one reversing everything Trump did.

        Trump deregulated... Biden restored them all.
        Trump refused to join the Global Compact on Migration... Biden joined on day one.
        Trump pulled out of the Paris Accord agreement... Biden rejoined it day one.
        Trump supported the pipeline(s) and Biden killed them... and all jobs associated with them.
        Etc. etc.

        Trump gets elected and tries to undo all that Biden allowed... from millions of illegal migrants being allowed in... to rescinding regulations that were killing industries... to Transgenders being given preferential treatment...
        Etc. etc.

        Yup... its a problem... one that was not such an issue from roughly 1990 to 2016 because whether a Republican or Democrat was President, the policies (the corruption) remained in place, the facade of change was maintained mostly through pushing social issues and focusing Americans on them.

        I mean the difference in direction the country was going to go... whether it was Romney or Obama that won, for example, would have been trivial and almost non-existent.

        I know most people who support a Party as if it is a religious cult won't ever believe that... but it was true... until the outsider Trump decided to get involved and wrecked havoc on things.

        But there could have never been a Trump... if a large majority of Americans hadn't gotten to the point where they were fed up and tired of being taken advantage of by a Political elite that had open disdain for them.

        1. profile image0
          tsmogposted 2 weeks agoin reply to this

          That reply certainly put a positive spin on what Trump did or is doing. Nice strategy. Kudos!!

          Me?

          I remain kicking back watching chaos theory unfold as entropy plays a hand at prophecy.

          And, then, sticking to what was learned when young, the Boy Scout motto;

          "Be Prepared".

          1. Ken Burgess profile image73
            Ken Burgessposted 2 weeks agoin reply to this

            Perspective is always a personal thing... especially in today's America.

            One person sees Trump as evil incarnate, the next sees Biden as the most harmful president we had seen in living memory.

            If interested in getting a better handle on China, the ongoing global realignment of power, etc.  I offer this for your reading leisure:

            BRICS
            https://infobrics.org/

            Some really good articles worth reading at the bottom of that page

            The China–Russia–North Korea Nexus: Implications for Regional Security and the War in Ukraine
            https://asiasociety.org/policy-institut … ar-ukraine

            Haven't downloaded the full report to read yet, but will get around to it.

            1. profile image0
              tsmogposted 2 weeks agoin reply to this

              Thanks! Bookmarked and placed in the folder marked interesting.

              1. Ken Burgess profile image73
                Ken Burgessposted 2 weeks agoin reply to this

                An interesting add... nor really belonging to this discussion, but close enough...

                Tariffs revenue neared $30 billion this August — the first month of Trump’s full 'reciprocal' tariff regime
                https://finance.yahoo.com/news/tariffs- … 19123.html

  2. Ken Burgess profile image73
    Ken Burgessposted 2 weeks ago

    China's Move to War Imminent ~ says one expert

    Make no mistake, Wednesday’s “victory” parade in Beijing was the most significant event since Xi Jinping came to power in China in 2013. It was both a triumph and a prelude; the triumph of military might and the prelude to using it.

    The Chinese leader did not don a uniform. Instead, he favoured a plain Mao-style outfit (of distinctive martial cut), in contrast to most of his suited guests overlooking Tiananmen Square.

    This was the new China at its most militant. Nuclear missiles, drones, advanced weapons of all kinds, thousands of regimented troops marching in tight precision. Much has been written about it as a display of pride. It is now time to consider intention.

    The honored guests were the Russian president Vladimir Putin and the North Korean dictator Kim Jong Un. With Xi, they made a trio of autocrats, unmistakably identified as the key players of the day by the Chinese media.

    All three are hardened survivors. Two of them, Putin and Kim, are steeped in blood. In the Chinese system, there is no longer any need to eliminate opponents physically. But Xi did not hesitate to decimate the military, purging defense ministers, generals and staff officers. The dismissal of his foreign minister in a spy scandal seemed a mere afterthought by contrast.

    One wonders whether, over their cups of tea, the Chinese and Russian leaders exchanged ideas about the necessity of purges. For Putin, the spectre of Yevgeny Prigozhin, rebel leader of the Wagner Group, who died in a mid-air explosion, has vanished from his calculations.

    As for the ever-smiling Kim Jong Un, he lives with the knowledge that he executed his own uncle, Jang Song Thaek, after a reported tip-off from China that Jang was plotting against him. Kim’s unfortunate relative was tied to a scaffold in front of an audience of cadres and shredded by an anti-aircraft gun.

    Nothing in Xi’s biography suggests that he enjoys cruelty or is personally ruthless. But he does wield power in a way that rivals Stalin in purpose. It would now be wise to assume that he is, in fact, going to move against Taiwan.

    US intelligence and military officials have testified that Xi has instructed the People’s Liberation Army (PLA) to be ready to “invade or coerce” Taiwan by 2027 – a date marking the centenary of the PLA’s founding. The date is not very far away. It must be taken seriously, because the autocrats may think there may never be a better time in world politics to strike.

    Xi and his comrades have watched as Putin’s war in Ukraine turned from blitzkrieg to stalemate. But there is no higher consideration in the Chinese system than survival. China considers that Putin has won the war merely by avoiding defeat.

    The third of the trio, Kim, is a veteran of three summits with US president Donald Trump, from which he emerged with both his nuclear arsenal and his power intact. If ever a group of leaders radiated confidence, it is these three.

    For all their belligerence, Putin and Kim do not have military credentials; Kim is a nepo baby and Putin a civilian KGB operative. Xi does. His father was a commander under Chairman Mao who fought campaigns across northern China in the country’s civil war.

    Xi’s first job was in uniform as one of three private secretaries to the defence supremo of China. At a young age, he was privy to military secrets. This was a staff post, of course, for no Chinese general has fought a land campaign since 1979.

    But throughout his rise up the civilian ranks of the party, Xi took care of the soldiers. While governing on the east coast, facing Taiwan, the record shows that he spent time visiting garrisons, improving conditions for the men, making sure families had good accommodation and boosting morale.

    Now he reaps the rewards. Insecure emperors do not parade themselves in front of thousands of armed troops. I doubt that he has ever looked so solid in office.

    So where does it go from here? China has absorbed multiple lessons from Russia. It has learned, for one thing, that it does not have to storm the beaches of Taiwan.

    “A combined operation involving an opposed landing [is] one of the most difficult and hazardous operations of war,” as Winston Churchill wrote. Xi knows the quote: his father had read Churchill’s memoir. Putin has shown him that he does not have to do it that way.

    Chinese tactics against Taiwan could be a hybrid of the Crimea and the dash to Kiev. Perhaps Putin has studied the German strategist Carl von Clausewitz and his theory of the concentration of maximum force at a decisive point. Xi and his generals know it by heart.

    In this scenario, China could command the seas by defeating an American force with one kinetic shock, securing control of the strait between Taiwan and the mainland. It could proclaim blockades, maritime quarantines, compulsory shipping lanes and aviation exclusion zones. Its new weapons could shatter American and Allied air and naval supremacy.

    Then there is what Mao called the “magic weapon” of propaganda and appeals to the greater Chinese nation. There is a ceaseless campaign of infiltration and cyberwar to persuade the Taiwanese that resistance is futile and destiny beckons and unity is inevitable. Chinese state outlets push narratives that the US cannot be trusted to defend Taiwan, emphasising the economic benefits of closer ties with Beijing. As Xi said at the parade, China is “unstoppable”.

    The trio of autocrats see this as part of a new world order to replace the old world made after 1945. They explicitly used the victory parade to state an “authentic history” of the time and to promote, of all things, the United Nations as their instrument of change.

    The Chinese foreign ministry unveiled three faults in the UN, first, “serious underrepresentation of the global South”, second, “erosion of authoritativeness” and, third, an “urgent need for greater effectiveness”. All bland, who could possibly object?

    Then it added: “Governance gaps exist in new frontiers such as artificial intelligence, cyberspace and outer space.” The solution: “China proposes the Global Governance Initiative (GGI) to promote the building of a more just and equitable global governance system and work together for a community with a shared future for humanity.”

    Naturally, it promised “extensive consultation and joint contribution” suitable for China’s role as “a staunch builder of world peace, contributor to global development, (and) defender of the international order”.

    It would now be wise to assume China’s Xi is going to move against Taiwan
    https://www.the-independent.com/asia/ch … 19499.html

    Flanked by Vladimir Putin and Kim Jong Un, Xi’s statement that China is now ‘unstoppable’ was a gauntlet thrown down to the West. This wasn’t just a display of pride, but of intention – Taiwan is already under attack without a boot on the ground, says Michael Sheridan

    Wednesday 03 September 2025 13:57 EDT
    Michael Sheridan is author of ‘The Red Emperor: Xi Jinping and his New China’,

  3. Sharlee01 profile image85
    Sharlee01posted 2 weeks ago

    Ken,   Great article, great food for thought! 

    This was an excellent read, and I can see why you shared it. What stood out to me most is how the piece highlights the tension between China’s state-driven model and America’s market-driven one. China can pour money into sectors quickly, but it often creates inefficiency and waste. The U.S., on the other hand, has historically relied on private markets, which excel at funding profitable innovation, AI being a prime example.

    That’s why I think President Trump’s recent approach is so important. By striking deals with companies like Nvidia, Intel, and MP Materials, he’s trying to bridge that gap, keeping our system free-market at its core, but recognizing that certain industries are too strategic to leave vulnerable. AI, advanced semiconductors, and rare-earth minerals all fall into that category. If we don’t act with urgency, China will outpace us not because of superior innovation, but because of their willingness to use heavy state subsidies and protectionist policies.

    The challenge, as the article points out, is discipline and focus. We can’t spread resources too thin or politicize investments. But when you look at Trump’s “America First” instinct and his transactional style, I actually see that as a strength here. He’s not afraid to set terms that put the U.S. at an advantage and hold companies accountable.

    To me, this feels like the beginning of a new kind of industrial policy, one that isn’t socialist central planning like Beijing’s, but a uniquely American model of public-private partnership that safeguards our strategic edge. If executed carefully, it could set the U.S. up not just to compete, but to lead in AI and other critical technologies for decades to come.

    1. Willowarbor profile image60
      Willowarborposted 2 weeks agoin reply to this

      So you're happy with Trump's move towards State capitalism and away from traditional free market principles?

 
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Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
Features
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Marketing
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Statistics
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
ClickscoThis is a data management platform studying reader behavior (Privacy Policy)