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Effects of China's Software Policy on World Economy?
guptaparesh asks: "The Chinese government is currently engaged in a comprehensive overhaul of its procurement policies and regulations. These regulations would ban non-Chinese firms from selling software to the Chinese government. Given that how much trade all the countries in the world are engaged in with China, isn't this a unfair trade move by the Chinese government?" A better question would be how this might affect the worldwide economy, particularly that of the U.S. and China. What benefits and drawbacks may China see as a result of this new policy? What steps might the U.S. take to attempt to counter it?
These regulations would ban non-Chinese firms from selling software to the Chinese government.
So whats to stop US companies from opening 'chinese' companies?
air and light and time and space
In principle, this is bad. This is protectionism, and protectionism is a Bad Thing.
In practice, how bad this is depends on the details. Specifically, can a business get away with just having a Chinese subsidiary? And if that subsidiary can be in Hong Kong, many companies are already positioned to meet this requirement.
"isn't this a (sic) unfair trade move by the Chinese government"
No. They are just creating a policy for how government buys software. They aren't disallowing any Chinese businesses or people from buying US or other software. I can't see how this affects the economy at all. The Chinese government big enough.
The global economy is a great thing until you feel it locally.
Imagine respecting international trade laws! Kind of a stretch, given a mafia government that respects nothing but power, and the money that flows from it.
Are you talking about the US or Chinese?
There is a perfectly logical reason a government should only buy from it's companies of it's nationality. In fact, all governemnts should do this, including the US.
By requiring that the companies you do business with be in your own jurisdiction, you are essentially keeping the money "in house" and keeping the jobs "in house" as well. The state of Indiana recently (last eyar or so) had a bill for this (not sure if it got passed or not). What it essentially does is increase the jobs and keep all money in state. For a federal governent to do it, it keeps the money in the country.
Makes perfect sense for a variety of reasons to do this.
Fly me to the moon Let me sing among those stars Let me see what spring is like On jupiter and mars
They can and will, but the Honorable Tom Davis says:
In a lawless land, the law is not much of a problem. The first one is easy to get around by selling to a vendor. The second one stops you cold, until you remember that China is as corrupt as all hell. Those with power will continue to do exactly as they please.
They could and should, of course, do completely without US commercial software. There are more than enough free software alternatives which can be "developed" by recompile in China. A totalitarian state ironically can have much better control of their IT if they are the root user of their own free software. No government, including the US government, should tolerate a third party owning their IT infrastructure the way US commercial software vendors demand.
How will this change the world economy? Not at all! The whole "engagement" deal Bill Clinton came up with was a pipe dream. China's leaders have made themselves rich of US and European trade by making slaves of their own people. Leaders who screw their own people like that will surely screw everyone else if they can. There are no surprises here, except to those dumb and immoral enough to do business with and invest in communist China.
DMCA, Hollings, Palladium. What might have sounded like paranoia is now common sense.
Good point. What's important to notice is who the US government is helping and why. Our government is interested in serving the rich inside our country because we are a plutocracy. The Chinese government IS the plutocracy, so naturally, they want to do things to benefit the industry inside their own country, the exclusion of all other industries.
What's funny is that from a class perspective, China's policy is more likely to help the little guy than the US's policy, so if anything, we should encourage China to foster their own industry. The greater the pool of software companies, the more of a demand there will be for labor, which should drive salaries up. This is why workers should encourage governments to help foster new players in industry.
If you make less than $500,000 a year, the last thing you should want is for governments to completely open their markets. The complete opening of markets will result in the eventual consolidation of worldwide industry, with predictable consequence of low wages, no benefits, and poor quality products. Keeping some barriers between large markets can be a good thing.
Unfortunately, the Bush Administration are the latter type of Republicans. (I'm not saying the Democrats are any better - they just have different friends and different special interests. The last good Republican President we had was Bill Clinton, and before him, well, we didn't elect Goldwater
So the Bush Administration may do something protectionist as retaliation, damaging more American businesses, or they may just give a bunch of speeches and not actually do anything. If we're lucky it'll be the latter.
Meanwhile, China's government have been pretty crazy, trying to pretend that they're preserving the benefits of Communist central planning and limited amounts of political repression while becoming corrupt capitalists in practice - but they're mostly Not Stupid about where the money's coming from. So yes, big foreign businesses will be able to set up Chinese subsidiaries or joint ventures to sell to the government as long as somebody's nephew or brother-in-law gets to run them. And small foreign businesses will be able to sell to Chinese wholesalers, or maybe sell their products as OEM to Chinese companies that will add value by localization.
Microsoft and Oracle probably already have Chinese "partners", or else they'll set them up, and there are Linux distributions developed in China, and possibly other Linux commercial distributors can get Chinese companies to do documentation and packaging for them.
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks
This is exactly what the US does do.
Many US government agencies do not use Checkpoint firewalls, solely because it's made by a company in Isreal.
China has a much more paranoid outlook. Good for them.
when China's economy lights up the real power will start to change hands. Thank god.
Thank god, indeed.
The US has quite a few flaws, but think long and hard on the above before you break out the champagne to celebrate Chinese dominance.
What part of "shall not be infringed" is so hard to understand?
1. Closing off government software contracts to foreign firms isn't protectionism. It's common sense if you have any real concern about information security.
2. This is a few hundred million dollars worth of contracts at best. It will have virtually no impact on the world software industry.
3. China has a frozen currency. They are not interested in fair trade. "China has long maintained a fixed exchange rate between the yuan and the dollar, providing an indirect subsidy to help maintain its high-growth economy. Such currency control gives Chinese exports a 15 percent to 40 percent price advantage on global markets. That antimarket policy also discourages exports of American goods and services to China." --CSM. Of course this strategy is not without trade-offs, China runs the risk of sudden and severe inflation by pegging its currency artificially.
4. All of you anti-American, anti-capitalist, pseudo-intellectual nitwits are stunningly ignorant, yet refreshingly smug. Trying to decide whether your ignorance is the result of selective learning, indoctrination, or just sheer lack of cranial capacity could be an amusing pastime for one with a much stronger stomach than mine.
Thank you for your attention. You may fire at will.
> The US has quite a few flaws, but think long and hard on the above
:(
> before you break out the champagne to celebrate Chinese dominance.
Yea, but at the rate we are going down the ol shitter the fall of US world dominance is a forgone conclusion in another generation. So all we can hope is that we manage to export Western Civilization to places like China & India before we collapse. Because we certainly haven't had a use for it here the last 50 years and Europe no longer even remembers having had it.
Democrat delenda est
I take it you've never heard the expression, "If you owe the bank a grand, its your problem, if you owe the bank ten million, its the bank's problem"?
Are you suggesting that the US can just not pay it back and not have it affect the US economy?
The amount of money the US owes China is less an expression of need for a loan as it is a display of contempt for their ability to ever claim it back.
1) The US does need the loan at its current spending and trade deficit. Maybe they can get it from other usual places like Saudi Arabia and Japan, but we all know that they can't just print more money? (right?)
2) The US is not immune to the kind credit problems that causes mass economic and currency flux to bounce around between Asia, Russia, Mexico, etc.
The Chinese that I know, and there are many, I even speak a good deal of Cantonese, are so completely and utterly brainwashed by their upbringing that they will accept no criticism of their country, nor any discussion.
This could be said about a lot of countries, US included.
China's population is about 1.3 billion (see the CIA World Factbook on China). The United States' population is about 295 million (see same source). Therefore China is closer to 4x the US population. Interestingly, while China's one-child policy would cause a population implosion around 2050 if maintained, the U.S. may grow to 500 million if the current trends in immigration continue.
Your contention that China's effect on the world should be similar to that of the U.S. based on its middle class population has some merit, but China also is in a different economic situation. Unlike the U.S., which is a mature industrial and post-industrial economy, China is in a high growth industrialization stage and in addition is offloading industrial production from Japan and the West. Therefore their IT needs may grow faster than those of the U.S. and they may indeed achieve some sort of dominance over software standards.
Whether this is a good thing is another question. Because laws in China are drawn up by technocrats and passed by fiat, they tend to represent a top-down view of how things should work. In the U.S. and other countries, standards are set by industrial consortia based partially on collective needs and partially on who's the biggest and richest on the committee. Whichever system prevails has yet to be seen.
The Chinese view the big Western companies as "hegemonist", especially the ones headquartered in the U.S., so they tend to reflexively oppose American-developed standards. Culturally, the Chinese have always been the "central kingdom" with their own language, history, technology and science stretching back thousands of years. They therefore tend to have a "not-invented-here" rejectionist mentality toward foreign ways. This is not to say that they don't copy stuff, but they try to sinicize it as quickly as they can, to translate it and get it to feel more palatable. It's quite likely that they're more comfortable with developing their own standards that may be based on IEEE, w3.org and so forth, but they will extend on them and make them work natively. The rest of the world can either go along and accommodate them or ignore them. Either way, we are in for some interesting times.
it's = "it is"; its = possessive. E.g., it's flapping its wings.