Another great thread. US ISI is curiously only interested in reshoring production, and incapable of pressuring firms to promote learning or technology diffusion. There is literally no institution or policy to promote these goals.
1/ Dan Wang’s NYT essay on TSMC's Arizona plant argues that TSMC is doing for America what Apple did for China. But the analogy rests on two assumptions and it's not clear that either one of them is holding.
nytimes.com/2026/10/23/opini…
More pushback by Lardy on the conventional narrative of rising Chinese subsidies. OECD claims bunk.
Future studies trying to judge magnitude of Chinese industrial subsidies should improve methodology, including fully disclosing the data on which they base their estimates & explaining why their estimates differ from prior studies, Nicholas Lardy says. piie.com/publications/policy…
A brilliant summing up of the utter intellectual bankruptcy at the heart of US academic institutions.
THIS IS WHAT IT LOOKS LIKE WHEN NATION'S FAILE
On the new Odd Lots, @tracyalloway and I talked to Nobel Prize winning economist James Robinson -- co-author of Why Nations Fail -- to tell us about the state of the US and what would be the signs of failure.
podcasts.apple.com/us/podcas…
Household income growth is accelerating and household consumption growth flat. Rural continues to significantly outpace urban in both.
Can't remember if I posted this previously. This is a chart of the share of value added by countries, based on OECD-TiVA data. Consult when you hear claims that the US is the indispensable source of China's external demand bofit.fi/en/monitoring/weekl…
"Top officials in the State Department made clear that only candidates who voted for President Donald Trump would be eligible for the mid-to-upper level foreign service roles. They also told candidates that their campaign donation history would be examined and any donation to Democrats would be disqualifying."
Why would the MSS do that when it's not their job? It's the job of the National Cybersecurity Threat and Vulnerability Information Sharing Platform (NVDB), which of course did issue alerts about the PHP vulnerability. US has Experts in propaganda and nothing else. Sad.
As the article basically admits, the US started this spiral, and is committed to maintaining it. It's not a two-sided mutual thing. The US could stop the choking and things would calm down. It won't and so it hasn't.
"The result is a world bristling with chokepoints and defenses in which every power still feels completely insecure. Even the most ordinary kinds of mutual dependence can begin to look like existential security risks. Put another way, in a world in which everything is connected, nearly everything could be considered a chokepoint. A piece of legislation introduced in the U.S. Senate in 2025 and the House in 2026, for instance, identifies even smart ovens and clothes dryers as potential security threats." foreignaffairs.com/united-st…
Licensing over FDI has support in the dev state literature. Too bad the US killed this academic research program, might come in handy now that the US is the technology-lagging latecomer.
mandating jvs isn't exactly liberalizing investment (no jv mandate now to my knowledge); and auto FDI is what many proponents of FDI are pushing with arguments I find a bit soft (assuming the same outcome as in China when conditions differ). But I do agree on the need to look beyond autos. has long seemed to me that the battery licencing deal was a better case (auto related of course) and don't think that has yet taken off. idea of starting with the production of components in the us tho does make more sense to me that starting with assembly operations that initially would use imported components and wwhere the economics say keep using imported components w/o high tariffs or an XR adjustment
I find it really interesting that the focus on the discussion on what the foreign girms would do. When what's more important is how to get your domestic firms to do what you want!
Lede is buried here. Duke cancelled his class.
Denis Simon, now teaching at Schwarzman College at Tsinghua University, shared this warning with @khushboo228.
scmp.com/news/china/diplomac…
Death by China, Confronting the Dragon: $24.22; The Coming Collapse of China: $6.49 (used); Portraying China's liberalizing its domestic payment system to a foreign firm as protectionism: Priceless.
