China Has Turned The Theory of Communism Into A Practical Success Story! - Page 36 - China Watch - Chinadaily Forum
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Post time 2018-5-16 12:22:41 |Display all floors
sfphoto Post time: 2018-5-16 00:38
Well, since the State funds the R&D, it’s the State which owns the IP. But in Finland, the Sta ...
since the State funds the R&D, it’s the State which owns the IP. But in Finland, the State doesn’t own the IP even though it funds the R&D, isn’t it?


If the funding goes to private corporations, state does not own the IP.

As I mentioned earlier, Finnish state is not interested in ownership of things that have no strategic importance. The state does fund R&D with various instruments, but the reason for that is to not getting to own the IP as national wealth, but to help companies to create jobs and tax revenue for the state. That's the national wealth in Finland.

It doesn't matter, if the jobs produce more wealth to the capitalist employers than the state, as long as employment to Finnish citizens and sufficient tax revenue to Finnish state is generated.

Finnish state also owns research institution of its own, but it's role is more to collaborate with and assist private companies to grow than to create IP as national wealth. Situation is similar in Finnish universities that are all state-owned. They do basic research and educate students, both of which will hopefully convert into prospering private businesses.

Finnish state also does have investments in private companies, but it holds majority ownership in very few, that all have some kind of strategic importance. Historically these have been railways, national airline company, postal services, oil refining, etc. Recent development in Finland continues to denationalize these.

For example with postal services, packet deliveries have already been liberalized earlier, but things like delivering newspapers and letters has not. The concerns in Finland are not so much of "national wealth" (and therefore not ideological) but more pragmatic like how to guarantee that services are also available in less densely populated areas - which there are a lot.

Also in China, the state does finance private enterprises (like Tencent) - if not directly, then indirectly in ways like tax incentives or at the very least by educating engineers to work in the company. Despite the state contributions, it is Tencent that owns the IP - not the state and not the employees.

"brands to be created under "Made in China 2025" won't end up equally capitalist as Tencent?" Well, yes. If the State funds the high-tech startup, then yes the company will behave just like any Capitalist enterprise with both the State and private Capitalists as investors.


I don't mean just high-tech startups, but any company that wishes to upgrade with "Made in China 2025". How do you prevent them from turning (if they already weren't) equally capitalist as Tencent?

I'm not saying that you need to prevent that, but your opinion seems to be that all that is bad in this world is due to capitalism. Or is a Chinese capitalist just much better than a foreign capitalist, because through his capitalism he would produce wealth to China and not someplace else?

"ones who would make most profits are those who not only succeed in domestic market but also abroad" That’s not true at all. Only a fraction of Chinese brands go overseas [...] don’t have the resources to go overseas


Let's consider through an example. Let's take an imaginary Chinese shoemaker "Ying", which previously has just produced cheap sneakers as contractor to overseas enterprise.

Now they upgrade to their own brand with "Made in China 2025". They become popular in China and get by nicely.

Meanwhile, the neighbouring company "Yang" (that also makes shoes) has done the same in local market, but not only that - they have also upgraded from exporting shoes overseas to exporting a new Chinese brand overseas. The "Yang" brand has not become popular only in China, but also abroad.

There are many reasons why "Yang" is now in much better position than "Ying" - and not least because their status as internationally recognized brand will hit big among Chinese consumers, which is the sole market for "Ying".

I can think of very few areas, where similar development will not take place.

Goods or services that are only sellable to Chinese market are limited to things that are very culture-specific (Peking opera or hotpot), will only work in Chinese infrastructure (many densely populated cities), or are challenged by local regulatory environments elsewhere (media, military).

In any other field (basically 99% of manufacturing), internationally recognized Chinese brand will be more popular also among Chinesese consumers, than a Chinese brand that is not internationally recognized.

After the GFC in 2008, Chinese entrepreneurs decided to set up shop on Alibaba where millions of Chinese SMEs now sell their wares online to Chinese consumers after export demand from Western markets collapsed.


And in your opinion, is Alibaba a capitalist enterprise or not? Again we get to the core issue, that there seems to be nothing wrong with capitalism as long as the capitalist is Chinese.

Obviously Alibaba has provided channels for Chinese SME's to prosper, but my point is that would those channels exist at all if one jackma or another didn't want to get rich by providing them.

There you have a solid example of capitalist greed serving the whole country - or at least millions of Chinese SMEs. Of which many (if not all) are smaller, but probably just as capitalist Alibaba or Tencent - and certainly at least equally greedy.

Made in China 2025 plans to upgrade the labor-intensive, export-oriented manufacturing industries to serve domestic markets by promoting local brands, automating local factories and integrating their supply-chains with e-commerce business models. IT will play a part in Made in China 2025: AI, robotics, IOT, blockchain, etc. And it’s already happening: Alibaba’s taobao, Tencent’s WeChat, etc. are good examples.


And none of this relates to workers' rights or Marxism in any way - with possible exception of robots making human workers redundant.

What I see here, is that "Made in China 2025" is not an alternative to labor unions and the state will still only look after workers in SOEs, while capitalism looks after everyone else - by assuming that a Chinese capitalist is better than foreign capitalist.

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Post time 2018-5-16 15:41:48 |Display all floors
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Post time 2018-5-17 06:03:44 |Display all floors
Jaaja Post time: 2018-5-16 12:22
If the funding goes to private corporations, state does not own the IP.

As I mentioned earlier, ...
If the funding goes to private corporations, state does not own the IP.

This is same in every Western country where only Capitalists get to own the IP by funding startups.
As I mentioned earlier, Finnish state is not interested in ownership of things that have no strategic importance. The state does fund R&D with various instruments, but the reason for that is to not getting to own the IP as national wealth, but to help companies to create jobs and tax revenue for the state. That's the national wealth in Finland.

Again, this is neoliberal Capitalism where only private Capital is allowed to own the national wealth while the State is supposed to privatize the national wealth. In Finland, Capitalists not the State own much of the Capital stock of high-tech companies such as Nokia even though much of its initial technology came from State funded R&D. This is the same situation throughout the West. GSM, for example, was the creation of the EU-funded ETSI but only Capitalist-owned enterprises commercialized the technology. Google’s search engine technology came out of NSF-funded research but only private Venture Capitalists commercialized the technology.

It doesn't matter, if the jobs produce more wealth to the capitalist employers than the state, as long as employment to Finnish citizens and sufficient tax revenue to Finnish state is generated.


This is the liberal model of Capitalist social democracy: Capitalists gets to own the wealth of nations while citizens of that nation get to work for Capitalists. The only role of the State is to collect taxes to pay for the welfare of its citizens.

Finnish state also owns research institution of its own, but it's role is more to collaborate with and assist private companies to grow than to create IP as national wealth. Situation is similar in Finnish universities that are all state-owned. They do basic research and educate students, both of which will hopefully convert into prospering private businesses.


In other words, the Finnish State funds most of the R&D but owns none of technology nor the wealth derived therefrom.

Finnish state also does have investments in private companies, but it holds majority ownership in very few, that all have some kind of strategic importance. Historically these have been railways, national airline company, postal services, oil refining, etc. Recent development in Finland continues to denationalize these.


Yes, neoliberal Capitalism serves the interests of private Capital by promoting the privatization of State-owned enterprises.

For example with postal services, packet deliveries have already been liberalized earlier, but things like delivering newspapers and letters has not. The concerns in Finland are not so much of "national wealth" (and therefore not ideological) but more pragmatic like how to guarantee that services are also available in less densely populated areas - which there are a lot.


Same in China. For example, the Chinese State invested trillions in building 25,000 kms of high-speed rail and 1,000,000 4G TD-LTE basestations in China after the GFC in 2008. This was part of the “Go West” strategy of developing the infrastructure of inland provinces in order to promote their economic development and encourage private companies to relocate from the coastal cities to serve domestic markets.

Also in China, the state does finance private enterprises (like Tencent) - if not directly, then indirectly in ways like tax incentives or at the very least by educating engineers to work in the company. Despite the state contributions, it is Tencent that owns the IP - not the state and not the employees.


Tencent (as well as Alibaba) are Capitalist-owned enterprises in which the State does not have any ownership stake nor management control. In fact, they were funded and are owned by foreign and local Capitalists. Jack Ma (Alibaba) and Pony Ma (Tencent) are entrepreneurs-turned-Capitalists who applied for and received their funding (Capital) from foreign Capitalists. Tencent is listed in the HKEX while Alibaba is listed in the NYSE, both of which are designed for Capitalist investors.

I don't mean just high-tech startups, but any company that wishes to upgrade with "Made in China 2025". How do you prevent them from turning (if they already weren't) equally capitalist as Tencent? I'm not saying that you need to prevent that, but your opinion seems to be that all that is bad in this world is due to capitalism. Or is a Chinese capitalist just much better than a foreign capitalist, because through his capitalism he would produce wealth to China and not someplace else.


The goal of Made in China 2025 is to nurture world-class technology industries and high-tech industrial companies. For SMEs, the State will fund and support them as privately-owned enterprises. For high-tech startups, the State will
fund and support them either as SOEs or MNCs. LENOVO started out as an SOE which was privatized to become an MNC while Spreadtrum started out as an MNC but was nationalized to become part of an SOE (Tsinghua

Made in China 2025 will help both State-owned as well as private enterprises. I don’t know whether these type of State-funded but privately-owned enterprises — both SMEs and MNCs — qualify as “Capitalist” but they are supposed to serve the national interests of China.

Let's consider through an example. Let's take an imaginary Chinese shoemaker "Ying", which previously has just produced cheap sneakers as contractor to overseas enterprise.


That’s what been happening over the last 10 years since the GFC 2008. China has produced Chinese sportswear brands (ANTA, 361, Li-Ning, Telent, etc) which serves the Chinese market. A million other SMEs have resorted to selling their wares on taobao.

Now they upgrade to their own brand with "Made in China 2025". They become popular in China and get by nicely.
In any other field (basically 99% of manufacturing), internationally recognized Chinese brand will be more popular also among Chinese consumers, than a Chinese brand that is not internationally recognized.


Most of the SMEs selling on taobao serve Chinese not foreign consumers. The few Chinese brands that have gone global had already succeeded locally and nationally before going overseas, eg., Huawei, VIVO, OPPO, Xiaomi in smartphones. There’s a few brands — Oneplus — that have succeeded Internationally but is unknown nationally. So there’s no requirement that Chinese brands have to go overseas. Most of them (99%) will survive and prosper just by selling to Chinese consumers.

And in your opinion, is Alibaba a capitalist enterprise or not? Again we get to the core issue, that there seems to be nothing wrong with capitalism as long as the capitalist is Chinese.


Yes, you could say that the Chinese State wants to fund and support its own class of privately-owned SMEs and MNCs so they don’t have to depend on foreign markets, foreign brands, foreign designs, foreign technologies, foreign Capital and foreign MNCs.

Obviously Alibaba has provided channels for Chinese SME's to prosper, but my point is that would those channels exist at all if one jackma or another didn't want to get rich by providing them.


Yes. But Jack Ma relied on foreign Capitalists to fund Alibaba. Made in China 2025 aims to change this situation so that Chinese entrepreneurs would get their funding and support inside China not outside China.

There you have a solid example of capitalist greed serving the whole country - or at least millions of Chinese SMEs. Of which many (if not all) are smaller, but probably just as capitalist Alibaba or Tencent - and certainly at least equally greedy.
And none of this relates to workers' rights or Marxism in any way - with possible exception of robots making human workers redundant.


Chinese Socialism has already adopted market Capitalism under State Socialism. After the Dengist reforms, the State allowed private enterprises — SMEs — to serve export markets under the global economy. But those SMEs became dependent upon foreign designs, brands, channels, technologies, all of which were owned by foreign Capitalists (MNCs). Now Made in China wants to eliminate this foreign dependency by helping Chinese SMEs (including hi-tech startups) get State funding, create their own brands, design their own products, develop their technologies to serve domestic markets.

What I see here, is that "Made in China 2025" is not an alternative to labor unions and the state will still only look after workers in SOEs, while capitalism looks after everyone else - by assuming that a Chinese capitalist is better than foreign capitalist.


Labor unions? What labor unions? Western MNCs — as part of neoliberal globalization  — decided to outsource the manufacturing of their consumer products in order to bypass labor unions, both Western and non-Western, and evade paying taxes back to Western governments so they can rip off Western consumers by charging them the Capitalist tax for their overpriced Western brands produced by sweatshop factories in developing countries.

China’s answer is Made in China 2025 which aims to reorient Chinese SMEs to serve domestic instead of export markets. That way, these Chinese SMEs will own their own brands, designs, channels, technologies to serve the Chinese market.

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Post time 2018-5-17 10:39:36 |Display all floors
sfphoto Post time: 2018-5-17 06:03
This is same in every Western country where only Capitalists get to own the IP by funding startup ...
Capitalists gets to own the wealth of nations while citizens of that nation get to work for Capitalists. The only role of the State is to collect taxes to pay for the welfare of its citizens.


Capitalists give employment to majority of population, that is correct. And the state gets revenue from taxing both the employees and the employers, in addition to dividends from investing (with or without controlling stake) to capitalist enterprises.

But it is incorrect to say that "capitalists gets to own the wealth of nations", because in these countries this is no longer the wealth of the nation to begin with. It was more so in the past, when states were ruled by absolute monarchies that owned both the land and the people.

But I see where you come from to use that terminology - in China much of that still applies, although it is called socialism.

Today in western countries, even if it is some resource of the land that the state sits on (like oil, or trees in Finland), it is not state's property to begin with if the land is privately owned.

Made in China 2025 will help both State-owned as well as private enterprises. I don’t know whether these type of State-funded but privately-owned enterprises — both SMEs and MNCs — qualify as “Capitalist” but they are supposed to serve the national interests of China.


For me, that is the main issue in our discussion. How do you decide who is capitalist and who is not?

Your comments come off as if all privately-owned foreign enterprises are capitalist, but somehow that does not apply to equally privately-owned Chinese enterprises.

In my opinion the whole lot is capitalist - it doesn't matter if they are Chinese or foreign, family-owned or publicly listed. Private ownership makes everyone capitalist.

From this perspective, "Made in China 2025" means that Chinese state will fund capitalist enterprises, to help create new tencents and alibabas that will operate as capitalist enterprises in capitalist market.

already succeeded locally and nationally before going overseas, eg., Huawei, VIVO, OPPO, Xiaomi [...]  there’s no requirement that Chinese brands have to go overseas. Most of them (99%) will survive and prosper just by selling to Chinese consumers.


Can you name some smartphone brand that is only available in Chinese market, and what its domestic market share is in relation to those four you mentioned, for example? I bet not very big.

My point is that such domestic brands can not really compete against international Chinese brands. You can do that short-term, but in long run they either go bankrupt, get merged and acquired by the bigger international brands, or become equally big international brands themselves.

China's experiences in many areas are not very long, and as you have repeatedly quoted, in this specific area the development in China started just 10 years ago. It is not mature enough to see how it will play out in coming decades, but you can make educated guesses based on how it has played out elsewhere.

Wth 10%+ GDP growth there is room to many players, but when going gets tough (for whatever reasons), M&A's take place. This happened to Nokia for example.

Of course this is China, but in my opinion the future developments here should be predicted as capitalist enterprises operating in capitalist system. "Made in China 2025" makes that only more obvious, because as I think, it means Chinese state will fund capitalist enterprises to grow.

China has produced Chinese sportswear brands (ANTA, 361, Li-Ning, Telent, etc) which serves the Chinese market


Li-Ning is also sold overseas, I don't know about the others.. But if things will develop naturally, it is more likely that Li-Ning will purchase those other three, than any of them purchasing Li-Ning.

Chinese State wants to fund and support its own class of privately-owned SMEs and MNCs so they don’t have to depend on foreign [whatever]


I think these developments are toward what we have in Finland elsewhere in west. Chinese state is increasing funding to domestic capitalist enterprises, not in order to own their IP or whatever they produce, but to help them grow.

In this perspective it seems that the state's ideology here is similar to mine. You cannot deny greed and you shouldn't deny capitalism, but you can tap into the capitalist enterprises to bring new wealth to the nation.

" "Made in China 2025" is not an alternative to labor unions " Labor unions? What labor unions?[...]


The ones that would look after workers' rights in Chinese SMEs. The SME's that previously would have relied in foreign markets, but with "Made in China 2025" will increasingly rely on domestic market.

China’s answer is Made in China 2025 which aims to reorient Chinese SMEs to serve domestic instead of export markets. That way, these Chinese SMEs will own their own brands, designs, channels, technologies to serve the Chinese market.


But why do you think that this will improve workers' rights in Chinese SMEs? The workers will not own any of that, the capitalist owners of these SMEs will.

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Post time 2018-5-17 19:21:01 |Display all floors
This post was edited by sfphoto at 2018-5-18 00:13
Jaaja Post time: 2018-5-17 10:39
Capitalists give employment to majority of population, that is correct. And the state gets revenue from taxing both the employees and the employers, in addition to dividends from investing (with or without controlling stake) to capitalist enterprises.

Yes, that’s what I wrote. Most Finnish citizens work for the Capitalist owners of Finnish enterprises not the Finnish State nor Finnish Society while most Chinese citizens work for the Chinese State (SOEs) or Chinese Society (SMEs).

But it is incorrect to say that "capitalists gets to own the wealth of nations", because in these countries this is no longer the wealth of the nation to begin with. It was more so in the past, when states were ruled by absolute monarchies that owned both the land and the people.

Norway’s national wealth comes from its oil resources which is owned by the State. That’s why Norway has the highest per capita income in Europe and one of the world’s largest sovereign wealth fund at US$ 1 trillion. Remember, if you’re a citizen of Norway, all those oil wealth now belongs to you because the State owns those oil resources as the national wealth of Norway. But if those oil resources were privatized, then it is correct to say that Capitalists — not the State — get to own the national wealth of Norway.

But I see where you come from to use that terminology - in China much of that still applies, although it is called socialism.

Yes, that’s why Norway calls itself a “Socialist” democracy.

Today in western countries, even if it is some resource of the land that the state sits on (like oil, or trees in Finland), it is not state's property to begin with if the land is privately owned.

Yes, that’s why those countries are what I’d call Capitalist Oligarchies such as the USA whose oil wealth was privatized to fund the creation of the US Federal Reserve System, a privately-owned bank vested with the sole privilege of issuing the currency of the USA — the US dollar — which became a fiat currency after Nixon abolished the gold standard.

For me, that is the main issue in our discussion. How do you decide who is capitalist and who is not?

Simple. If you get to print trillions of USD and then use those monies to buy the Capital stock of the entire Western World at a bargain price after the GFC in 2008, then you’re a Capitalist, numero uno.

Your comments come off as if all privately-owned foreign enterprises are capitalist, but somehow that does not apply to equally privately-owned Chinese enterprises.

Nope. You’re confusing the Chinese Socialist with the Western Capitalist SYSTEM. All Western privately-owned enterprises get their Capital — whether in the form of debt, equity, cash, etc. — from Capitalists. Even Western governments get their Capital — in the form of public debt — from Capitalists who own all the banking/financial institutions in the Western World. To say that privately-owned enterprises in Socialist China are “Capitalist” is a contradiction in terms because ALL Chinese privately-owned enterprises get their Capital from State-owned banking/financial institutions. The exception to this rule are Chinese MNCs such as Alibaba, Tencent, LENOVO, etc.

In my opinion the whole lot is capitalist - it doesn't matter if they are Chinese or foreign, family-owned or publicly listed. Private ownership makes everyone capitalist.

Nope. Private-ownership of an enterprise does not make it Capitalist because it still serves the “Socialist Market Economy” under Chinese Socialism. The SYSTEM itself is still Socialist not Capitalist. In the same vein, just because the FDIC — which is owned and managed by the US Federal Government to insure banking deposits in the USA — is State-owned does not make it “Socialist”. The FDIC still serves the Capitalist system of the USA.

From this perspective, "Made in China 2025" means that Chinese state fund capitalist enterprises, to help create new tencents and alibabas that will operate as capitalist enterprises in capitalist market.

If those hi-tech startups need to go overseas, then the State could privatize them and relinquish management control to Capitalist investors in order to make them succeed in global markets as Capitalist-owned MNCs. Otherwise, if they’re mostly serving the domestic market, then they’ll turn into SOEs.

Can you name some smartphone brand that is only available in Chinese market, and what its domestic market share is in relation to those four you mentioned, for example? I bet not very big.

Well there are brands mostly sold outside China such as Coolpad, Oneplus, etc. So having international brand recognition is not a prerequisite for success inside China.

My point is that such domestic brands can not really compete against international Chinese brands. You can do that short-term, but in long run they either go bankrupt, get merged and acquired by the bigger international brands, or become equally big international brands themselves.

Not really. China has lots of auto manufacturers but only a few of them has succeeded internationally.

China's experiences in many areas are not very long, and as you have repeatedly quoted, in this specific area the development in China started just 10 years ago. It is not mature enough to see how it will play out in coming decades, but you can make educated guesses based on how it has played out elsewhere.

With 10%+ GDP growth there is room to many players, but when going gets tough (for whatever reasons), M&A's take place. This happened to Nokia for example.

Yes, there are too many “me-too” manufacturers in China, all making the same products with very little differentiation in terms of branding, design or technology. They always compete on price. So I see a lot of consolidation in the smartphone space to just a few global players. My prediction is that there will be four to five global players by 2020.

Of course this is China, but in my opinion the future developments here should be predicted as capitalist enterprises operating in capitalist system. "Made in China 2025" makes that only more obvious, because as I think, it means Chinese state will fund capitalist enterprises to grow.

See my statement above. The Chinese SYSTEM will remain Socialist but there will be more Capitalist MNCs coming out of China by 2025.

Li-Ning is also sold overseas, I don't know about the others.. But if things will develop naturally, it is more likely that Li-Ning will purchase those other three, than any of them purchasing Li-Ning.

In apparel, most Chinese brands serve the Chinese market. Same with shoes, bags, furniture, etc. That will remain true because there’s no need to those Chinese brands to go overseas to serve global markets.

I think these developments are toward what we have in Finland elsewhere in west. Chinese state is increasing funding to domestic capitalist enterprises, not in order to own their IP or whatever they produce, but to help them grow.

In this perspective it seems that the state's ideology here is similar to mine. You cannot deny greed and you shouldn't deny capitalism, but you can tap into the capitalist enterprises to bring new wealth to the nation.

China’s reason for supporting Capitalist enterprises is to turn them into Chinese MNCs which can compete in global markets. It’s not about allowing Capitalist greed into the Socialist system.

The ones that would look after workers' rights in Chinese SMEs. The SME's that previously would have relied in foreign markets, but with "Made in China 2025" will increasingly rely on domestic market.

But why do you think that this will improve workers' rights in Chinese SMEs? The workers will not own any of that, the capitalist owners of these SMEs will.

Labor unions are irrelevant in the context of Chinese SMEs. In macroeconomic terms, Chinese Socialism is already taking care of social welfare in the form of public housing, education, healthcare, welfare, social security, etc. What’s missing is the lack of social mobility for the working classes in the export industries in the coastal cities. Those Chinese SMEs in the coastal cities serve as sweatshop factories of Western MNCs which make them part of the Capitalist economies of the Capitalist West not the Socialist economy of Socialist China. It’s this foreign dependency on Western Capitalism that is being addressed by Made in China 2025 which aims to support Chinese SMEs to serve the domestic market while grooming Chinese MNCs able to compete in global markets.

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Post time 2018-5-17 23:21:12 |Display all floors
sfphoto Post time: 2018-5-17 19:21
Yes, that’s what I wrote. Most Finnish citizens work for the Capitalist owners of Finnish enter ...
Most Finnish citizens work for the Capitalist owners of Finnish enterprises not the Finnish State nor Finnish Society


What you refuse to acknowledge, is that the capitalist owners of Finnish enterprises include (in addition to possible foreign owners) optionally the state itself, as well as all Finnish citizens who choose to own a specific enterprise (wholly themselves, or partially via stocks or other instruments).

By the way, choice should be a keyword there. The state, as well as the citizens, have the freedom of choice in deciding what they want to own.

I for example would never have any stake in tobacco industry, but in China that is state-owned industry and every Chinese owns it, even if some would prefer to invest their share of the national wealth into something more healthy.

Norway’s national wealth comes from its oil resources which is owned by the State.


Norway's national wealth is still valued in US dollars, and other than fueling vehicles, it's usefulness is limited to purchasing goods manufactured by capitalists. Including those vehicles.

"decide who is capitalist and who is not?" Simple. If you get to print trillions of USD and then use those monies to buy the Capital stock of the entire Western World at a bargain price after the GFC in 2008, then you’re a Capitalist,


So the only capitalist in your view is the US state? You cannot be serious.

In my view, capitalist is anyone who seeks to make profit one way or another.

To say that privately-owned enterprises in Socialist China are “Capitalist” is a contradiction in terms because ALL Chinese privately-owned enterprises get their Capital from State-owned banking/financial institutions.


No they don't, because that wealth in Chinese banks ultimately originates from transactions that Chinese private enterprises, SOEs and even the state itself has done with western capitalists.

Not to mention those Chinese entrepreneurs that use their own savings without any financing from banks. You can argue that following the money leads to state-owned Chinese financial institutions anyway, but then I continue to argue that the wealth of Chinese state-owned financial institutions in turn originates from western capitalists.

Earlier this year China sent two pandas to Finland, and received the usual amount as compensation. That's western capitalist money, that went to fund (I assume and hope) Chinese state-owned research directly, not even via some some "capitalist" business transaction.

Calling private Chinese enterprises non-capitalist just because they operate in a socialist country is humbug. They operate in every way same as their western counterparts, in a capitalist system that is China.

Private-ownership of an enterprise does not make it Capitalist because it still serves the “Socialist Market Economy” under Chinese Socialism.


By serving the “Socialist Market Economy” do you mean paying taxes? Or providing products or services to citizens of China? All capitalist enterprises in China (foreign or not) do that too. I do that.

I really cannot understand what in your opinion (seriously) makes one entity capitalist and another not. It cannot be just the system that they are registered or operate in.

For me it is simple. All humans are greedy for something by nature, and those who choose to exercise that greed without restrictions are 100% capitalists. Those who sacrifise everything they could gain by their greed to service of others are 100% socialists. Most people are somewhere between.

From my perspective, no corporation is 100% capitalist, unless they choose to liquidate immediately and share all the wealth of the corporation between the owners. And no corporation is 100% socialist, unless they make no profit at all and just pay salaries to staff and equal return of investment to owners.

If those hi-tech startups need to go overseas, then the State could privatize them and relinquish management control to Capitalist investors in order to make them succeed in global markets as Capitalist-owned MNCs. Otherwise, if they’re mostly serving the domestic market, then they’ll turn into SOEs.


Oh, so is the idea of "Made in China 2025" that all Chinese SMEs who choose to not go international, will end up owned by the state? This is news to me, and I'm sure it would be news to those millions of Chinese SME owners.

lot of consolidation in the smartphone space to just a few global players. My prediction is that there will be four to five global players by 2020.


Well do you think that any "China only" smartphone brand will survice in this? Or are there any such even now?

It’s not about allowing Capitalist greed into the Socialist system.


That greed is there already. It is that greed where the counterfeits and fraudulent sales tactics and products in AliBaba originate from.

Labor unions are irrelevant in the context of Chinese SMEs. Chinese Socialism is already taking care of social welfare in the form of public housing, education, healthcare, welfare, social security, etc


Then why have Chinese SMEs exporting goods to western capitalists been allowed to exploit their workers? Why has the socialist state not intervened to that? Does the state intervene if it happens in MNCs or SOEs?

what’s missing is the lack of social mobility for the working classes in the export industries which is being addressed by Made in China 2025.


How in your opinion will this reduce exploitation of workers? More jobs to choose from so they don't have to stick to those that exploit them?

From my wife's home village in mountains 20+ uneducated farmers in many age groups work in the same sock factory in Yiwu. Some have left their children behind. The company sells socks both to China and abroad, on Taobao too.

What jobs will these villages have to choose from, when "Made in China 2025" kicks in on their part?

Nodoby is concerned about rights of high-tech workers getting lapdances from programmer motivators. You need to look in the other end of spectrum. That's were the communist revolution started. Or are you saying that's where it will finish too?

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Post time 2018-5-18 14:19:05 |Display all floors
Jaaja Post time: 2018-5-17 23:21
What you refuse to acknowledge, is that the capitalist owners of Finnish enterprises include (in ...
What you refuse to acknowledge, is that the capitalist owners of Finnish enterprises include (in addition to possible foreign owners) optionally the state itself, as well as all Finnish citizens who choose to own a specific enterprise (wholly themselves, or partially via stocks or other instruments).

By the way, choice should be a keyword there. The state, as well as the citizens, have the freedom of choice in deciding what they want to own.

Norway’s STATOIL (now called EQUINOR) is 67% owned by the Government of Norway with another 3% owned by the Government Pension Fund of Norway. From its oil revenues, Norway has amassed the world’s largest Sovereign Wealth Fund at $1 trillion which is invested all over the world. So the State of Norway has that choice which the US Government doesn’t have even though the USA is now the world’s largest producer of oil. The difference: Norway is “Socialist” while the USA is “Capitalist”.

I for example would never have any stake in tobacco industry, but in China that is state-owned industry and every Chinese owns it, even if some would prefer to invest their share of the national wealth into something more healthy.

Are you implying that it’s better for Norway to divest of its oil wealth? Because it’s harmful? To the environment?

Norway's national wealth is still valued in US dollars, and other than fueling vehicles, it's usefulness is limited to purchasing goods manufactured by capitalists. Including those vehicles.

Of course, that’s because oil is priced in USD.

So the only capitalist in your view is the US state? You cannot be serious.

No, Sir, the biggest Capitalists are the owners of the US Federal Reserve System because they — not the US Government —have the sole and exclusive right to issue the USD currency and create money through their banking/financial institutions.

In my view, capitalist is anyone who seeks to make profit one way or another.

Your view is incorrect.

No they don't, because that wealth in Chinese banks ultimately originates from transactions that Chinese private enterprises, SOEs and even the state itself has done with western capitalists.

No, sir, the PBOC — as the Central Bank of China — has the sole and exclusive right to issue the RMB currency while the Chinese banking/financial institutions (99% of which are State-owned) have the sole and exclusive right to create money in the form of cash, debt, stocks, etc. and get their RMBs from the PBOC. The USD reserves in the PBOC are used only for foreign trade (current account) and investment (capital account) transactions but not for domestic transactions.

Not to mention those Chinese entrepreneurs that use their own savings without any financing from banks. You can argue that following the money leads to state-owned Chinese financial institutions anyway, but then I continue to argue that the wealth of Chinese state-owned financial institutions in turn originates from western capitalists

.

Nope. China’s state-owned banking/financial institutions do not need Western Capitalists because the PRC — founded by Mao’s People’s Revolution — is a SOCIALIST country. China can issue its own currency and create its own money without taking foreign money from Western Capitalists. That’s the difference between Socialist and Capitalist countries: the State — not Capitalists — has the sovereign right to issue its own currency and create its own money.

Earlier this year China sent two pandas to Finland, and received the usual amount as compensation. That's western capitalist money, that went to fund (I assume and hope) Chinese state-owned research directly, not even via some some "capitalist" business transaction.

Yes, but that’s an example of a transaction involving foreign trade.

Calling private Chinese enterprises non-capitalist just because they operate in a socialist country is humbug. They operate in every way same as their western counterparts, in a capitalist system that is China.

Nope. Foreign MNCs operate in China but they’re Capitalist because their source of Capital comes from foreign Capitalists in their Capitalist countries. Chinese SMEs source their Capital from State-owned banking/financial institutions in China. The exception to this are Chinese MNCs such as Alibaba, Tencent, Lenovo, etc. who source their Capital from foreign Capitalists.

By serving the “Socialist Market Economy” do you mean paying taxes? Or providing products or services to citizens of China? All capitalist enterprises in China (foreign or not) do that too. I do that

.

No. I mean those Chinese SMEs are financially accountable to the State as their source of Capital in the same way those foreign MNCs are financially accountable to their Capitalist investors.

I really cannot understand what in your opinion (seriously) makes one entity capitalist and another not. It cannot be just the system that they are registered or operate in.

It’s their source of Capital: Socialist (State) vs Capitalist (private Capital).

For me it is simple. All humans are greedy for something by nature, and those who choose to exercise that greed without restrictions are 100% capitalists. Those who sacrifise everything they could gain by their greed to service of others are 100% socialists. Most people are somewhere between.

From my perspective, no corporation is 100% capitalist, unless they choose to liquidate immediately and share all the wealth of the corporation between the owners. And no corporation is 100% socialist, unless they make no profit at all and just pay salaries to staff and equal return of investment to owners.

It’s the SYSTEM that makes an enterprise Capitalist or Socialist.

Oh, so is the idea of "Made in China 2025" that all Chinese SMEs who choose to not go international, will end up owned by the state? This is news to me, and I'm sure it would be news to those millions of Chinese SME owners.

Nope. You misread my post: the State will fund and support hi-tech startups which will turn into SOEs.

Well do you think that any "China only" smartphone brand will survice in this? Or are there any such even now?

Smartphones are becoming a commodity that needs brand recognition to survive. So all those online resellers hawking their branded or no-brand smartphones will probably disappear. But you never know in China. New brands come up all the time.

That greed is there already. It is that greed where the counterfeits and fraudulent sales tactics and products in AliBaba originate from.

Yes, that’s because those SMEs don’t have their own brands. And that’s why Made in China 2025 aims to change all that.

Then why have Chinese SMEs exporting goods to western capitalists been allowed to exploit their workers? Why has the socialist state not intervened to that? Does the state intervene if it happens in MNCs or SOEs?

The problem is the system of Capitalist globalization which exploits those Chinese SMEs. That’s why the Chinese State invested trillions to build the infrastructure and develop the economy of inland provinces so that rural villagers don’t have to move to coastal cities in order to work in sweatshop factories. Chinese authorities knew about the labor exploitation but couldn’t do anything about it until the GFC in 2008. The flood of money was just too much that it took the collapse in demand to finally force the Chinese State to act.

How in your opinion will this reduce exploitation of workers? More jobs to choose from so they don't have to stick to those that exploit them?

Yes.

From my wife's home village in mountains 20+ uneducated farmers in many age groups work in the same sock factory in Yiwu. Some have left their children behind. The company sells socks both to China and abroad, on Taobao too.

They left their rural villages in the inland provinces because they couldn’t find work. The only work available were for sweatshop factories in the coastal cities which had container shipping bound for export markets. That system of Capitalist globalization is intrinsically exploitative. China wants to get out of the sweatshop business altogether. And Made in China 2025 is the plan.

What jobs will these villages have to choose from, when "Made in China 2025" kicks in on their part?

Service jobs.

Nobody is concerned about rights of high-tech workers getting lapdances from programmer motivators. You need to look in the other end of spectrum. That's were the communist revolution started. Or are you saying that's where it will finish too?

Well, that programmer needs to eat, drink, shop, sleep, travel, read, watch, listen, play, invest, heal, relax, laugh, etc. Those consumer services need service workers. He does technology work while she does service work. Technology and services industries will generate the most wealth and most jobs in the next three decades in China.

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