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On March 27 2018 10:19 Plansix wrote:
The video game industry has an average career length of 5 years. Activision had a very profitable year and still shitcanned like 3 studios and fired a bunch of highly paid employees. There is a growing push for unionization that just got floor space at GDC. The video game industry is possibly the worst example of an industry that cares about its workers.
My roommate was a manager on the new Sonic Mania game. Can confirm that working for gaming companies can suck hard
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Um. Why is this trade defecit/surplus conversation so focused on spending? Canada is actually a pretty terrible place in terms of consumer overspending and leveraging credit to make bad decisions, but we run trade surpluses because our economy is still (sadly) driven by natural resource exports. Does anyone know what, for example, Germany's export economy is like?
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You're all missing the legitimate argument for tariffs on China and merely regurgitating generic free trade arguments that don't really apply here.
In general, free trade benefits all parties and pretty much everyone with any familiarity with economic knows tariffs are, in most cases, a net loss. The EU tariffs are unjustified.
The issue with China is that their market is far less open than any major economy--they started the "trade war", but they've been treated with kiddie gloves as they've been a developing economy and the expectation was that they would open up their economy as time goes on. Every major economy essentially agrees that China still engages in unfair trade practices.
But what about the WTO, you say? The WTO is insufficient in China's case for several reasons. This mainly stems from the fact that WTO rules predate the emergence of China's state-led capitalism model (at least as a significant trading economy). This cripples the WTO in two ways: First, its existing enforcement mechanisms aren't set up to deal with the close ties between state and business that China has. Second, China's authoritarian government is far more nimble and adversarial than the mostly friendly (mostly democratic) countries the WTO was set up oversee. This has allowed China's government to blatantly violate the spirit of WTO guidelines while still adhering to the letter of them.
So we've established that there is a problem, and the WTO isn't much help: but why tariffs? Aren't they a blunt and imprecise tool for influencing trade that hurts growth on both sides?
Yes, and that's sort of exactly the point. As I alluded to earlier, China's government is far more nimble and adversarial than any nation the US has ever traded with. Not only that, but it's a country that is essentially infamous for saying/nominally doing one thing, and in reality either doing the opposite or not doing anything all. And this theme has come up repeatedly on trade for years (as well as in other areas). It's practically China's MO at this point.
So how do you deter that? You enact punishment (i.e tariffs) up front (which is justified as China already began the trade war anyway) and negotiate their conditional removal when China has actually kept its promises. That way, China has incentive to act and can't simply pretend to act until the next election when we do the same song and dance all over again (like we've done for the past decade).
Tariffs on their own are bad, but tariffs to open up and enforce fair/free markets are a good thing. Just like violence is in general bad, but the threat of violence in society from government against thieves and cheats gives consumers and businesses confidence to do business.
What would make the tariffs even better is if others would join in, and if all parties uphold their end in removing tariffs if/when China meets its terms.
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United States44286 Posts
A trade deficit means that you get more stuff from a county than you give the country. That's pretty much impossible on the face of it because a trade requires an equal exchange, it requires payment. Take the classic example of the British trade deficit with China before the Opium Wars, there was still a full settlement of the exchange, it's just that the good the Chinese wanted from Britain was silver, not anything manufactured British wares.
China is getting an even exchange, they're not getting robbed, they're getting something they value as equivalent to the goods. And better yet, they're getting paper, not silver.
Normally when you only pay in paper you devalue the paper which causes the trade deficit to correct itself, raising the cost of the imported goods in the local currency. But China pegged their currency to the dollar, preventing that release valve and artificially keeping the value of the dollar high. In short, they're undercharging the US and that's why the US gets so much shit from China.
Let the good times continue.
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Also, opening up China will not change anything about our trade because their labor is still far cheaper than US labor. What are they going to buy from us that they don't already make for cheaper? Are we going to compete with a labor market that undercut our own labor market to the point where we shifted to a services based economy?
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Right, the forced transfer of tens to hundreds of billions of USD worth of IP (and decades of research time) is okay because we bought a bunch of cheap disposable goods whose value will be close to 0 USD within 30 years. That's definitely a wise long-term trade from a US perspective. And when US businesses/financial firms can't spend their profits from Chinese manufacturing to buy >51% equity (along with a with enormous laundry list of other financial restrictions) on companies in the country that's generating 1/3 of the world's growth, that's fine too.
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United States44286 Posts
I think you underestimate just how much China is subsidizing the high American standard of living. Americans want Chinese labour.
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One would think companies would have stopped making their products in China for cheap labor once that labor started stealing their designs for knock offs. But apparently the buisness realities just made to much sense. If they just kept their production in the US, they wouldn't have this problem. But they are going to convince some people that a trade war over IP rights is a good idea because they don't really care about the farming industry that exports to China. Because some of these companies will do anything to avoid paying Americans for labor.
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I think you're forgetting that if China had a more open and fair market, both sides would benefit even more than they are now. You're trying to defend Chinese protectionism by advocating for free trade. The argument is self-defeating.
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You are not advocating for anything that will end Chinese protectionism. A trade war isn't going to force a sovereign nation to open up it's markets. America cannot bully China and we should stop deluding ourselves into thinking we can. China will just do buisness with the rest of the world and fight a trade war with the US until the next election or beyond.
To quote the late Ryan Davis: China don't care.
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Uhhh, China does care. At least as much as America cares. It's harder to replace a major customer than a supplier. That's basically the first rule of business. The US will hurt more in the short-term, but China will feel it more in the long-term. The US will take an initial price shock, but won't have much trouble finding new cheap manufacturing labor in Vietnam, India, or via automation, and prices will return to normal with time. Chinese labor is becoming relatively less competitive as they demand higher wages anyway. The US was always going to have to move it somewhere else, and there's no shortage of developing countries eager to eat up US investment. US companies doing it ahead of schedule isn't necessarily a bad thing for the US in the long-term.
China, whose economy attempting is to pivot towards higher value goods, can't just find another "world's wealthiest single market" to buy their products. Especially if the EU or other nations join in--which they might because China's trade practices are legitimately unfair unlike the US's.
Trump isn't doing himself any favors by ratcheting up tensions elsewhere, but he's at least right on China.
EDIT: To add to KwarK's point below, most of the stolen IP is more from selling to the Chinese market rather than from buying Chinese manufacturing labor. The value of low-skill manufacturing IP is relatively low compared to computer chips, airplanes, software, and other high-value/high-skill businesses that try/tried to compete in China. By law, you can't sell to the Chinese market without a local partner.
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United States44286 Posts
On March 27 2018 12:36 Plansix wrote:
One would think companies would have stopped making their products in China for cheap labor once that labor started stealing their designs for knock offs. But apparently the buisness realities just made to much sense. If they just kept their production in the US, they wouldn't have this problem. But they are going to convince some people that a trade war over IP rights is a good idea because they don't really care about the farming industry that exports to China. Because some of these companies will do anything to avoid paying Americans for labor.
Once you've offshored something for a while you can't bring it back. Economies are like an ecosystem, you have a network of interconnected systems that sustain each other. If you lose the jobs you lose the training programs that train people to do the jobs. You lose the primary industries that make raw materials for those jobs. You lose the entire chain built on that product. That's the entire reason why China did what it did, they sold their labour and a raw materials at a discount to incentivise capital investments in China.
If Trump decided that there would be an immediate import ban on Chinese goods there is no way that America could resume where China left off. It would take a command economy and decades to create the conditions needed.
It's not about not wanting to pay Americans anymore, the generation of Americans who can remember how to do the jobs that were outsourced have retired already and the places where they worked have been torn down to build a Starbucks.
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There is no reason for the EU to join in with Trump's silly flirtation with tariffs and things that caused the Great Depression. And this isn't a long term plan. This is a short term plan that will end the instant the farming industry takes a hit and starts voting for whoever will end the terrible plan that was proven to be bad by the Great Depression. Because tariffs are taxes on Americans, not China. It is just the US government picking winners and letting China pick the losers.
Edit: Kwark, valid point. I also can't feel bad for companies complaining that the cheap labor is taking advantage of them.
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On March 27 2018 10:41 mikedebo wrote:
Um. Why is this trade defecit/surplus conversation so focused on spending? Canada is actually a pretty terrible place in terms of consumer overspending and leveraging credit to make bad decisions, but we run trade surpluses because our economy is still (sadly) driven by natural resource exports. Does anyone know what, for example, Germany's export economy is like?
300bn$ surplus in 2017.
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So the Admin basically only has 1 lawyer still.
A pair of veteran white collar lawyers have turned down President Donald Trump’s offer to help lead his defense in the Russia probe, marking another setback for a legal team that’s seen its numbers dwindle over the last week while it prepares for a potentially critical interview between the president and special counsel Robert Mueller.
The law firm Winston & Strawn said Monday night that two of its partners — former federal prosecutors Tom Buchanan and Dan Webb — were approached by Trump but declined the job “due to business conflicts.”
“However they consider the opportunity to represent the president to be the highest honor and they sincerely regret that they cannot do so,” the law firm said. “They wish the president the best and believe he has excellent representation in Ty Cobb and Jay Sekulow.”
Trump’s legal team is now led by Cobb, who is handling official White House matters in response to special counsel Robert Mueller’s investigation, and Sekulow, a conservative attorney and talk radio host who has been the public face of the president’s outside legal team.
Sekulow declined comment when asked Monday night about the president’s attempt to hire Buchanan, a former assistant U.S. attorney in Virginia, and Webb, a former Reagan-era U.S. attorney from Chicago. Webb led the prosecution of Adm. John Poindexter during the Iran-Contra affair and later served as an independent counsel in 1989 who cleared a George H.W. Bush White House aide of allegations he broke federal ethics laws in failing to repay a $5,000 personal loan.
“We are proceeding with our ongoing cooperation with the Office of Special Counsel,” Sekulow said.
Trump’s legal team has had a rough week. Last week, it lost John Dowd, the president’s longtime lead personal attorney, who resigned after the president tried to hire Joseph diGenova and his wife, Victoria Toensing.
DiGenova and Toensing had their own problems, and on Sunday, Sekulow cited conflicts of interest as the reason they were not joining the president’s team. The couple are law partners and were already representing two other people in the Russia case: former Trump legal team spokesman Mark Corallo and Sam Clovis, a Trump campaign policy adviser.
But a senior administration official told POLITICO that Trump’s attorneys had pleaded with the president against hiring the couple not just because of the conflicts of interest. There was also concern about their ages (he’s 73, she’s 76), their penchant for extolling unfounded theories, and the president was turned off because they looked disheveled when they came to meet with him last week.
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How not to perform Public relations:
Mark Zuckerberg has refused the UK Parliament's request to be questioned by MPs over data abuse.
The Facebook boss will send one of his senior deputies instead, the company said. Damian Collins – who leads the digital, culture, media and sport select committee – had had written to Mr Zuckerberg directly requesting that he appear.
Mr Collins letter made the request in the strongest possible terms, and suggested that Mr Zuckerberg himself should appear. He gave until Monday evening to reply to the request.
Facebook has now replied, on a letter dated 26 March, in which it says that it will send either Mike Schroepfer, Facebook's chief technology officer, and Chris Cox, its chief product officer. Both have worked under Mark Zuckerberg for more than 10 years, and are among the longest serving executives at the company.
It didn't say why the Facebook boss himself could not appear.
Mr Zuckerberg has been repeatedly criticised for his failure to speak publicly about the allegations of data abuse made in the wake of the Cambridge Analytica scandal. He didn't address the controversy at all for a number of days, and eventually did so with a statement on his site that itself drew criticism from users.
The letter to Damian Collins came from Rebecca Stimson, Facebook's head of public policy in the UK. It said that Facebook took the request from Parliament seriously.
"Facebook fully recognises the level of public and Parliamentary interest in these issues and support your belief that these issues must be addressed at the most senior levels of the company by those in an authoritative position to answer your questions," it read. "As such Mr Zuckerberg has personally asked one of his deputies to make themselves available to give evidence to the Committee."
The letter also claimed that only one per cent of downloads of thisisyourdigitallife – the app that Cambridge Analytica used to harvest data about users without their knowledge – had come from the UK.
Damian Collins said that the DCMS committee will be "very happy to hear from Mr Cox to give evidence", but that he still wanted to speak to Zuckerberg.
He said that it wasn't clear from the letter "whether he is available as well" and suggested that Parliament would consider setting up a "video link if that is more convenient for him".
Mr Collins also suggested that it still expected Mr Zuckerberg to come if he couldn't convincingly say why he shouldn't.
"He stated in interviews that if he is the right person to appear he will appear," he said. "We think he is the right person and look forward to hearing from him.”
Mr Collins' original letter, sent last week, accused Facebook of having "consistently understated" the risks of abuse of data by the company, and that they had been "misleading to the Committee".
"It is now time to hear from a senior Facebook executive with the sufficient authority to give an accurate account of this catastrophic failure of process," he said.
He then addressed Mr Zuckerberg directly: "Given your commitment at the start of the New Year to 'fixing' Facebook, I hope that this representative will be you".
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Methinks the future where Facebook comes out of this ok is the one where Zuckerberg leaves.
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On March 27 2018 20:35 Sbrubbles wrote:Mozocu, though I recognize that establishing tariffs in this circumstances can be something that can be used as a bargaining ship for long term liberalization, I'm not sure Trump can manage such a gamble, and do think this endeavor should be taken by a broad coalition of US trading partners, not by the US unilaterally. Anyway, I saw a similar argument mentioned in an economics blog recently and thought it was interesting https://everydayecon.wordpress.com/2018/03/26/a-theory-of-tariffs-as-a-method-of-promoting-long-run-free-trade/
He did this dance with China already over Tibet, if I recall; they see him as a paper tiger. Xi Jinping isn't going to blink against Trump, when he knows he just has to hold on and he'll fold like cheap origami. The guy can barely hold onto a coherent position for an entire week. Jinping, on the other hand, is generally solid as stone. I can't see a single scenario where Trump can convince China that he's really really super serious(tm) this time and they'd better do something right quick.
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On March 27 2018 20:35 Sbrubbles wrote:Mozocu, though I recognize that establishing tariffs in this circumstances can be something that can be used as a bargaining ship for long term liberalization, I'm not sure Trump can manage such a gamble, and do think this endeavor should be taken by a broad coalition of US trading partners, not by the US unilaterally. Anyway, I saw a similar argument mentioned in an economics blog recently and thought it was interesting https://everydayecon.wordpress.com/2018/03/26/a-theory-of-tariffs-as-a-method-of-promoting-long-run-free-trade/
I've read a little about Id Software & I guess it's pretty good in terms of employee relations & such. I know EA Software has a bit of a "computer game farm" mindset there where they put out a version of NFL 2k every year & yet another Need For Speed game every year. So maybe those aren't the "greatest examples" of companies to follow. Maybe think about Cargill.
Yes, small / minimal trade tariffs can be used to change things slightly in terms of the national economy. Interest rates at the Federal Reserve are another thing that can be changed, and are changed, from year to year. It is not well understood what levers to push in what direction to make things better rather than worse. It is true that the US can also get supplies & raw materials from India, Vietnam, Brazil, or (most likely) even more from Mexico as they do quite a bit already. That being said, there is already plenty of trade that is already going on with China right now so there is no reason to rock the boat except maybe to make sure that "all of their eggs are not in only one basket." That's a fairly sensible way to think.
The US doesn't buy all that many cars from China but Chinese do buy a lot of American cars, so that is a pretty big market there too. Clearly they are going to want to make sure they get a reasonable deal in terms of equality, & they are going to want to push their own carmakers first, I'd think. That seems sensible. Maybe the US should diversify a little bit to reduce their reliance on China, and that would reduce the trade deficit a bit. That's a good plan.
The US is the biggest entity in terms of trade of any kind in the world right now so it makes sense that they might want to change things to some degree, & they are able to do that if they so choose. It's a bit of a hassle & takes a lot of effort to push these things through the legislature & get things signed off & so on, so this could take a long while. The question is: in what way makes sense? What's the best way?
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EPT
