China

[3point14]

What is it with people who treat high speed rail like it’s holy? Like running at a massive loss doesn’t mean anything?

Doesn't one's view on it running at a loss depend on what one think it's for?

If you think the purpose of high speed rail is to make money, yes it matters.

If you you think the purpose of high speed rail is to get people from A to B quickly and efficiently then it's a service, not a profit making industry and perhaps that's acceptable.

If you want to see the results of attempting to run public transport services for profit, rather than as a service, then you can look at the UK rail industry...

 

[Ziggurat]

Doesn't one's view on it running at a loss depend on what one think it's for?

If you think the purpose of high speed rail is to make money, yes it matters.

If you you think the purpose of high speed rail is to get people from A to B quickly and efficiently then it's a service, not a profit making industry and perhaps that's acceptable.

What's the point of getting people from A to B quickly? Presumably that has value, but if people aren't willing to pay for it, what is that value? How do you measure it? How do you know it's worth the money? Even if the point isn't to make money, money is still an important metric, because you could be spending that money on other things that might produce more value. There's an opportunity cost to everything, and you can measure that in dollars (or yuan).

The fact that their high speed rail has turned into a money pit does matter. It is a strong sign that they've misallocated resources. In fact, it's obvious that they've misallocated resources, because the trains aren't just running at a loss, they're also running well below capacity. And note, this isn't a situation where they knew it would be a net cost and decided after careful consideration that it would still be worthwhile to do. They thought it could make money, and proceeded on that basis. They predicted ridership levels, and proceeded on that basis. And they were wrong. They were wrong to the tune of almost $1 trillion.

No, it wasn't worth it.

 

[3point14]

What's the point of getting people from A to B quickly? Presumably that has value, but if people aren't willing to pay for it, what is that value? How do you measure it? How do you know it's worth the money? Even if the point isn't to make money, money is still an important metric, because you could be spending that money on other things that might produce more value. There's an opportunity cost to everything, and you can measure that in dollars (or yuan).

I don't disagree with this at all.

The fact that their high speed rail has turned into a money pit does matter. It is a strong sign that they've misallocated resources. In fact, it's obvious that they've misallocated resources, because the trains aren't just running at a loss, they're also running well below capacity. And note, this isn't a situation where they knew it would be a net cost and decided after careful consideration that it would still be worthwhile to do. They thought it could make money, and proceeded on that basis. They predicted ridership levels, and proceeded on that basis. And they were wrong. They were wrong to the tune of almost $1 trillion.

No, it wasn't worth it.

Yup. I was just railing against your blanket 'if it doesn't make money, it's not worth it'. Lots and lots of things that don't make money are worth it.

 

[Ziggurat]

Yup. I was just railing against your blanket 'if it doesn't make money, it's not worth it'. Lots and lots of things that don't make money are worth it.

I think that's an oversimplification of my original point. But no matter. On the specifics of China's high speed rail, it appears that we're in agreement.

 

[The Atheist]

Counterfeit stamps?

https://www.stuff.co.nz/world-news/350242594/china-flooding-britain-fake-stamps-act-economic-warfare

Claims of economic warfare sound a little overdone at a time when hardly any stamps are used.

Looks like a simple opportunist scam, but who knows.

 

[theprestige]

Never mind stamps. I'm still waiting to see how China working to sortie a couple of sea control ships puts it on par with the Pax Americana Maritimus.

Also I'm rolling on the floor laughing at the idea of airfields on ersatz atolls in BFE South China Sea supposedly being bastions of naval power. The US has form striking fixed targets with stealth bombers flying nonstop round trips from the other side of the planet.

 

[Ziggurat]

Looks like a simple opportunist scam, but who knows.

Yes and no. The economic war aspect comes from the fact that the CCP tolerates these sorts of things. This is just one example of many. More common is the intellectual property theft, but the principle is the same. They may not be directing it, but they allow it because they are OK with harming other countries. It's effectively economic warfare, with a veneer of plausible deniability, but they know. They know, and they permit.

 

[The Atheist]

Never mind stamps. I'm still waiting to see how China working to sortie a couple of sea control ships puts it on par with the Pax Americana Maritimus.

It doesn't, and I specifically said that.

Also I'm rolling on the floor laughing at the idea of airfields on ersatz atolls in BFE South China Sea supposedly being bastions of naval power.

Obviously, your reading comprehension needs brushing up, because I didn't say that either.

The US has form striking fixed targets with stealth bombers flying nonstop round trips from the other side of the planet.

Form striking targets? Like the Taliban and ISIS?

There is zero chance America would attack them, so how easy it is for stealth bombers to attack them is irrelevant.

 

[Hlafordlaes]

I confess China had me fooled. But it is China that is the fool, essentially blowing its start-up cash from global investors, now left with unproductive assets, no customer base at home, and offended ex-patrons abroad. Empty rice bowl, coming up.

 

[Ziggurat]

There is zero chance America would attack them, so how easy it is for stealth bombers to attack them is irrelevant.

We're not likely to start a war with China. But if they invade Taiwan, we very well might. If they use force to prevent US freedom of navigation, we might. I don't put the chances of any of that happening very high, but they aren't zero.

 

[The Atheist]

I confess China had me fooled. But it is China that is the fool, essentially blowing its start-up cash from global investors, now left with unproductive assets, no customer base at home, and offended ex-patrons abroad. Empty rice bowl, coming up.

I'll believe it when I see it.

I make it at least 15 years that people have been claiming the Chinese boom economy is going to crunch, but it clearly hasn't yet.

Ghost cities, regional debt, Evergrande... pick one then show me what the real-world effect has been on their economy.

We're not likely to start a war with China. But if they invade Taiwan, we very well might. If they use force to prevent US freedom of navigation, we might. I don't put the chances of any of that happening very high, but they aren't zero.

I've said before, China will look to take out Taiwan when they have sufficient strategic weapons to target USA. They've built over 300 ICBM silos in the past few years and are still adding to them.

When China has enough missiles to threaten USA they will announce they're taking over Taiwan and will target American cities if they interfere. America is not going to risk hundreds of millions of deaths for an island of Han Chinese.

 

[Ziggurat]

Ghost cities, regional debt, Evergrande... pick one then show me what the real-world effect has been on their economy.

You do know that Chinese economic growth is cratering, don't you? They had a long stretch where it was like 8%+ per year. But those days are gone, and they're never going to return.

And in what possible world could you ever think that China's demographic collapse won't hamstring them? Seriously, how exactly do you think that could ever work? You do know that it takes a minimum of 20 years to make a 20 year old worker, right? The number of workers China will have over the next 20 years is already set in stone, it's already declining, and it cannot be increased by any possible government program. Nor have any of their efforts to do something about their demographic collapse had any effect on reversing the trend in the future either. China is literally dying.

When China has enough missiles to threaten USA they will announce they're taking over Taiwan and will target American cities if they interfere. America is not going to risk hundreds of millions of deaths for an island of Han Chinese.

Will China risk hundreds of millions of deaths for an island that's going to be rubble either way? If we do intervene to stop an invasion, would they really launch, knowing that we would strike back? Would that actually be worth it to them?

And here's an uncomfortable reality for China. Suppose that we promised not to interfere. Could China successfully invade Taiwan today? No, they could not. Amphibious invasions are really, really hard to do, and Taiwan has been preparing for decades. Yes, they're building up their armed forces, but it's not going to be enough, not any time soon. The problem is intrinsically hard.

China saw what happened with the Russian invasion of Ukraine. On paper, Russia should have steamrolled Ukraine. But they didn't. China has many of the same problems with corruption that Russia has, and no effective means to solve those problems either. And although China's military is larger and better armed than Russia's, Taiwan is likewise far better armed and trained than Ukraine. And again, amphibious assaults are intrinsically harder. If you think it's a **** show for Russian troops when the lead tank in a column gets taken out by a Javelin, just wait till you see a troop transport taken out by a mine. The Ukraine war was the death knell for an invasion of Taiwan.

You might argue that China's military buildup will mean that eventually they'll be strong enough. But that's not true either. Again, demographics is destiny, and their demographics are worse than you think. They cannot continue the current rate of military expansion for the next 20 years. They will not have the spare economic capacity to do it, or the spare manpower to actually field as an invasionary force.

 

[The Atheist]

You do know that Chinese economic growth is cratering, don't you?

Yep, disastrous. It's a mere double America's.

Will China risk hundreds of millions of deaths for an island that's going to be rubble either way? If we do intervene to stop an invasion, would they really launch, knowing that we would strike back? Would that actually be worth it to them?

I think they'll reccognise that America, like all bullies, is a coward when the odds aren't massively in their favour and will be correct in the analysis that America won't risk firing a shot.

China saw what happened with the Russian invasion of Ukraine.

Taiwan isn't going to be getting many missiles by train or truck.

And if they're watching, they might notice that Ukraine seems to be losing now, despite the combined efforts of the entire western alliance.

I don't think they'll be too disheartened.

 

[The Great Zaganza]

Chinese technocrats will figure it out, but of course it will take a bit.
Having no ideology gives you flexibility.

 

[GraculusTheGreenBird]

Chinese technocrats will figure it out, but of course it will take a bit.
Having no ideology gives you flexibility.

But they do have an ideology.

Keep the CCP in power at literally all costs. If that means a dead or dying China, so be it.
As long as they are still in control of what is left.

 

[Ziggurat]

Chinese technocrats will figure it out, but of course it will take a bit.
Having no ideology gives you flexibility.

No, they will not figure it out. There is no solution to their demographic collapse, it’s unavoidable.

And they have no flexibility, because everything is dictated by Xi.

 

[Ziggurat]

Yep, disastrous. It's a mere double America's.

It’s not going to be. Can you not see the direction of the trend line? And keep in mind, even at a higher percentage growth rate, China’s economy won’t be growing more than ours in absolute terms. Hell, pretty soon it won’t be able to grow at all, as their demographic collapse accelerates. They will reach a point where productivity gains cannot overcome the shrinking work force.

Taiwan isn't going to be getting many missiles by train or truck.

It’s almost like you don’t realize ocean transport is massively more efficient than train or truck.

And if they're watching, they might notice that Ukraine seems to be losing now, despite the combined efforts of the entire western alliance.

We aren’t trying very hard. And again, Taiwan is already armed to the teeth, Ukraine wasn’t. Plus, in case you haven’t noticed, unlike Russia, China is not food or fuel self sufficient. It depends on ocean trade itself. And Taiwan has a submarine fleet. They can halt fuel imports to China.

Hell, the US doesn’t even need to fire a shot to cripple China. All we need to do is stop buying Chinese goods. China depends on US buying far more than we depend on Chinese selling. Again, China is vastly more vulnerable on this front than Russia was.

I don't think they'll be too disheartened.

They will be if they have a clue.

 

[Roboramma]

Yup. I was just railing against your blanket 'if it doesn't make money, it's not worth it'. Lots and lots of things that don't make money are worth it.

Sure, but as a first order way to look at whether or not something is worth doing, asking whether or not it's profitable is very useful. If its profitable then clearly the benefit to the users exceeds the costs to the producers*. If it's not profitable, can it still be worthwhile? Sure, but that's a harder case to make, usually based on the thing being a public good**.


*Of course there may be other costs, external to the producers, but again this is a first order answer.

**Ie. a good which is both non-rival and non-excludable. There's a case to be made that high speed rail, and transportation infrastructure in general, is a public good, at least in part, which is why it makes sense for government to be involved in the construction of such infrastructure projects, but of course one still needs to quantify the costs and benefits of such projects.

 

[Roboramma]

And in what possible world could you ever think that China's demographic collapse won't hamstring them? Seriously, how exactly do you think that could ever work? You do know that it takes a minimum of 20 years to make a 20 year old worker, right? The number of workers China will have over the next 20 years is already set in stone, it's already declining, and it cannot be increased by any possible government program. Nor have any of their efforts to do something about their demographic collapse had any effect on reversing the trend in the future either. China is literally dying.

I almost completely agree here, except for the "any possible" part. There's one way to get more adult workers without having to grow them at home: immigration. But China is both unlikely to be able to attract a sufficient number of foreign workers, or to adopt a policy that welcomes them, so the point is probably moot.

 

[Roboramma]

It’s not going to be. Can you not see the direction of the trend line? And keep in mind, even at a higher percentage growth rate, China’s economy won’t be growing more than ours in absolute terms. Hell, pretty soon it won’t be able to grow at all, as their demographic collapse accelerates. They will reach a point where productivity gains cannot overcome the shrinking work force.

Yep. And even if they were doing everything right (which as you rightly point out is far from the case, the period of ~10%/year GDP growth was a period of catch up growth, this is fundamentally different from the cutting edge growth that is happening in developed countries like the US. Most obviously: one relies on already developed technology and knowledge which just needs to be implemented, the other on developing fundamentally new ideas. Even if they'd done everything right, China wasn't going to stay on the same growth trajectory indefinitely.