The China Thread

[Sheilbh]

It's a little tough because the episodes are normally about a reporting trip with clips of people who they speak to (and, as they always point out, who are willing to speak and be recorded by a Western journalist).

But in this one their China correspondent in China (the other one is now reporting from Taiwan) read a book about the Third Front which was basically Mao's push from the mid-60s to the mid-70s to build Chinese infrastructure and industry inland. This was all secret, like closed cities in the USSR and designed to be hidden from potential enemies. After reading the book he visited Panzhihua which was one of these cities built around a steel mill in a place that had no good reason for a steel mill to exist. But now it has a large Third Front museum (though it's not on the red tourist trail party promoted sites).

Interesting conversations with Chinese tourists. But also the actual history was that most of the CCP leadership were highly resistant and kept on fobbing Mao off about it, until the Gulf of Tonkin and US escalation in Vietnam which made all the leadership think they were at risk from Soviet and/or American and/or Indian attack (this was when there were regular clashes on the border). Then they were basically all in until Nixon's visit. So some reflections on that as it was hugely expensive economically and in human terms (though never a priority for the CCP), but was suddenly seen as essential for security by the leadership.

Also slightly complicated because the book by a Western academic actually ends with evidence noting that it was hugely expensive economically, it was at huge human cost - but there's reason to believe it meant the interior of China was able to develop much quicker than otherwise so in the long run the economic cost/benefit is less clear.

But really interesting bit of history, plus current China and also people talking about it as many in the town or visiting either were or had family who were moved into the Third Front.

[Jacob]

Thanks for that

[HisMajestyBOB]

It's not only in China. Chinese firm built a multi billion ghost town in Malaysia too with the sultans backing.

To be honest I

Read a report in NZZ on the Chinese real estate crisis. Some crazy numbers there. 90 million empty appartments, another 230 million square meters under construction.  Some older investments had to be written down by 2/3 already. 70% of all private savings invested in real estate. When that bubble bursts, it will be the greatest crash of all times.

On the other hand, in the US least we could use a few million new houses or apartments. 

[Josquius]

It's not only in China. Chinese firm built a multi billion ghost town in Malaysia too with the sultans backing.

To be honest I

Read a report in NZZ on the Chinese real estate crisis. Some crazy numbers there. 90 million empty appartments, another 230 million square meters under construction.  Some older investments had to be written down by 2/3 already. 70% of all private savings invested in real estate. When that bubble bursts, it will be the greatest crash of all times.

On the other hand, in the US least we could use a few million new houses or apartments. 

Could you though?
I get the impression the US situation is even more extreme than the UK one in that there's no actual national  housing shortage but a huge mismatch between where the housing is and where people want/have to live.

[HVC]

Chinas bring out the big guns. They're taking back their pandas from other countries zoos. That'll teach you to be mean to China.

[Crazy_Ivan80]

Chinas bring out the big guns. They're taking back their pandas from other countries zoos. That'll teach you to be mean to China.

Good. They're useless animals anyway. To lazy to procreate.

[garbon]

I judge everything on a strict schedule of utility.

[The Brain]

I judge everything on a strict schedule of utility.

[Sheilbh]

This focuses on AI (because tech press) but China as well is very striking. If these reports are true I have to wonder what exactly Apple thought they were getting with Stewart:

Apple Reportedly Cancels Jon Stewart's Show Over His AI and China Talking Points
The show was abruptly canceled due to tension over Stewart's desire to cover the topics of artificial intelligence and China, report says.
By
Kevin Hurler

Jon Stewart is best known for pissing the right people off with his nuanced political takes on his Apple TV show The Problem with Jon Stewart, and it appears he's also pissed off his employer. Stewart's The Problem has officially been canceled, and the reason why may lie in his view on artificial intelligence, a project Apple has been quietly working on.

The show would not be returning for a third season on the streaming platform Apple TV+, The New York Times reported Thursday. Things came to an "abrupt" end due to differences in direction between Stewart and Apple fueling the split. The Times says that Apple was feeling tension regarding Stewart's interest in covering topics surrounding artificial intelligence and China. Future topics related to the upcoming 2024 presidential election reportedly could have caused an even further divide between the company and Stewart.

Apple reportedly approached Stewart and informed him that he needed to be "aligned" with the company's values, according to The Hollywood Reporter. Stewart apparently "balked" at the idea of being sterilized by Apple, the report says.

Taping for the third season's first episode was scheduled to begin in a few weeks. The comedian and political commentator is currently in the midst of a multi-year deal with Apple to produce content with his company Busboy Productions.

Apple did not immediately return Gizmodo's request for comment.

Artificial intelligence has been taking the world by storm for bad or for worse, with companies like OpenAI ham-fisting the tech into every facet of our lives. Apple has also been interested in its piece of the pie, and canceling The Problem over coverage of AI could be a way to keep the brand's name positively associated with the technology.

In May, news broke that Apple was building its own AI while banning its employees from using large language models like the wildly popular ChatGPT.  Apple made progress on its AI endeavors in July with the main AI framework being codenamed "Ajax" (perhaps a reference to Apple Jacks), while an internal chatbot has the name "Apple GPT."

I always wonder quite how Apple fits into US-China de-risking. I believe some interpreted the Chinesse direction of state employees to not use Apple phones as a shot across the bow to Apple and the US but it feels like they're an incredibly vulnerable target - and possibly can't even do anything about it because if they do, the Chinese state may interpret it fairly badly.

[Jacob]

Interesting. My thoughts:

1) Good on Stewart - it's good that there are still people out there producing investigative / critical analysis like him.

2) Apple banning their staff from using ChatGPT (presumably at work) makes sense. There are massive risks for companies handling any kind of confidential data to let their people use products doing unknown things to the inputs. And that's before the any kind of "we want a slice of the pie, not feed a competitor" considerations. Most tech companies I know of have pretty restrictive policies on things like ChatGPT and for good reasons.

3) Good observation re: Apple and China. I expect the US gov't has some security and intelligence ins on the down low with Apple. I also think China would like some. And those two things are mutually exclusive. It's not unthinkable that complying with Chinese, US, and EU legislation around gov't access/ private information/ monitoring becomes impossible at some point.

And given Xi's proclivities, it's not far-fetched to envision a scenario where he decides a more compliant domestic champion should have Apple's marketshare, or that Apple's Chinese operations should become a Chinese company fully compliant with Zhongnanhai.

Looking at what happened to folks like Jack Ma (and many others) I'm confident that Xi would enjoy showing a foreign company like Apple (or Tesla) who the boss really is.

Significant risk there for Apple, IMO.

[Barrister]

Interesting.  I just finished reading this piece on Jon Stewart in The Bulwark:

https://plus.thebulwark.com/p/jon-stewart-and-apples-low-reward

Writer Sonny Bunch points out that Stewart's show does very poorly (40,000 unique viewers) bringing basically zero benefit to the company, but that given his still-high-profile he always runs the risk of saying something and going viral, which risks tying Apple to whatever Stewart just said.

Plus yeah, it focuses on China, not AI.

Concluding paragraph:

If Jon Stewart really did walk from his show because Apple wanted him to shy away from potentially controversial topics, well, bully for him, that's great: I will likely never know, but I'm sure it's not easy to walk away from an eight-figure check on general principle even when you're worth nine figures. The whole thing is a reminder, however, that the entertainment industry's decision to entwine itself with Chinese interests has had a real and measurable negative impact on the ability to tell honest and important stories about our time.

[Sheilbh]

And just on Apple - from the FT. China is launching a tax and land use investigation into Foxconn.

Separately China's imposed export restrictions on graphite which is a key component for EV battery manufacture. China only has a small propoprtion of the world's graphite but 65% of graphite processing is in China. The major importers are the US, South Korea and Poland.

As with a lot of other similar stories like this, the US and other impcted can produce this and can catch up (on graphite specifically, Turkey has a lot of reserves) - but it'll take time and it'll take state direction/coordination.

[The Minsky Moment]

I don't get the Chinese strategy here.  Intimidating Foxconn just encourages the trend whereby Apple and other big  foreign players that have helped underwrite China's manufacturing might will direct every incremental dollar somewhere else.  If China's economy were overheating that would be one thing, but the reality appears to be the opposite - that the PRC is at risk of a deflationary recession, assuming it already isn't in one.

The graphite ban also makes no sense; it won't do any material damage to the US or SK but it just adds further momentum to the reshoring/friendshoring bandwagon.   

What concerns me is that the only strategic rationale that makes sense here is if the goal is to transition back to Maoism or "Socialism in One Country." 

[HVC]

It also works for internal consumption, which is shirt term thinking but important for Chinese leadership.  They also know the west has a short memory and (I assume) think they can mend things in the future if need be.

[Jacob]

"Xi wants to be Mao" has been the analysis of the Chinese people I'm the closest to pretty much since he took over.

I've seen nothing to counter-indicate that and plenty that conforms to the theory.

Xi and his family was hurt by the cultural revolution. Seems the lesson he took was that a cultural revolution is fine as long as he is in the driver's seat.