competition – Oscar Valdes

The Business Side – China

Two American business executives, Ray and Andrew, talk about the China threat.

Ray – Much too much is made of China taking advantage of what we produce, then working with it to improve it.
Andrew – They do a good job at it.
Ray – They do. The way to deal with it is keep improving our products. Making them better and better. Sure, if a particular technology is highly specialized and critical for our security, we should consider not letting them have it. But only for a little while. We should see China as a challenge for us to keep getting better and better. We’re in the making and selling of stuff, anything, and constantly improving it.
To do that we need markets. China is a great market.
Andrew – Does the Chinese state subsidizing private businesses gives them an advantage?
Ray – Of course. So, for critical industries, we should get our government to subsidize us too.
Andrew – We can’t change China. Might as well join them.
Ray – In some things.
Andrew – Do you have any doubt that they have the ambition to become the dominant power in the world?
Ray – No doubt at all. We just won’t let them. Period. If we need to go to war, then that’s what we’ll have to do.
Andrew – Nuclear war?
Ray – We don’t need to go there. More sophisticated conventional weapons should do. In Ukraine, the mobile launchers they now have are making a difference. And if they get the F-16’s they were promised, it will turn things around.
We just have to compete better with China. They are stealing from us because we have more than they do. In some areas, where they’re making a lot of progress, we need to invest more here in the states.
But China ought to be seen as a great stimulus to us, so we can become more efficient.
Andrew – We need to keep track of what they produce so we won’t become dependent on them.
Ray – Right. We shouldn’t become dependent on any one country. Just in case there’s conflict and the supply lines get gummed up. Like with Covid and in Ukraine. That was amazing how Europe got so trusting of Russia to provide their energy needs.
Andrew – So you’re not afraid of China getting stronger?
Ray – I’m not. But we need to keep getting stronger than them. As I said, let’s look at them as a stimulus to do better. Not just economically but politically.
Andrew – Do you think immigration gives us an advantage?
Ray – I do. There’s two things that give us a huge advantage. One is immigration – people all over the world want to come here, not to China. And the other is Freedom. They don’t know what that is in China. But they dream of it in secret.
I’m a believer that as they continue to get richer, one day they’ll want to have their freedom, too.
That will upset a lot of people in the communist party.
Andrew – Any challenges that you see we’re having trouble with?
Ray – Yes. We need to give our people more opportunity for advancement. So they can get a better education and earn more. If that means raising taxes on the wealthier, so be it.
The more educated our work force the better.
But keep immigration open. And our freedom.
Andrew – You heard about Liz Cheney announcing she’s interested in a presidential bid?
Ray – I did. She needs to change her stand on abortion to have a shot. Just say, ‘I changed my mind. This is too important to women. I’m now pro choice.’ And women would run to vote for her, just to see her in the primary debates go up against Trump and say to him, ‘Hey, didn’t you just try to overthrow our government? What are you doing here?’
Andrew – You think Biden will run again?
Ray – I do. And if Ukrainians manage to push back Russians he’ll win handily. That’s how important that war is.
Andrew – What do you think of Musk?
Ray – I think they’ll force him to buy Twitter and he’ll say to himself, ‘I should watch my mouth.’
Andrew – Thank you, Ray. We’ll meet again.

Oscarvaldes.medium.com, apple podcasts.

China and the US

We’re now in the thick of a struggle with China. A struggle for economic and technological primacy.
China has proved itself a formidable opponent. One that challenges us to the core, which is good for us.
Competition, with all its problems, has the advantage of pushing us to perform as best we can.
Unless we go to war, the likelihood is that this contest will last a long time.
Russia, for all its chest thumping in Ukraine and elsewhere, is not really part of this contest. They would like to be but, until they rid themselves of Putin and choose a different kind of leadership, they will remain a second level participant.
But back to China and the US.
This contest asks of us, which is the better social organization that can elicit the greater productivity from its citizens?
We both are presently thinking the social organization we presently have is the best one. But that is now in question.
China has shown a great deal of inventiveness and capacity for hard work. They acknowledged they needed to open themselves to other nations to promote internal prosperity, then did so and leaped forward in a spectacular manner in just 40 years. They have been called the factory of the world. Mastering the new information, they put it in their service.
Their social organization managed the transition effectively.
But will that same organization be able to address the complexities of the new environment they have created?
Recently we’ve seen how the political leadership, in the interest of ‘managed prosperity’, has inserted themselves in the governing of businesses and large conglomerates. My bet is that this approach will backfire and reduce the efficiency needed to compete.
The impulse of government to meddle in the running of successful businesses is ever present. We see attempts to do so here in America too, but in the end prove consistently detrimental to the creative and competitive impulse.
It will take time for the Chinese to acknowledge that flaw. The reason is their limits on free speech and the consequent drowning of critical voices.
We, in contrast, enjoy free speech, but are falling short on the discipline that must go with it.
How come, for instance, we’ve allowed ourselves to fall behind in the production of advanced semiconductors and so become dependent on a factory in Taiwan, which lies so close to China?
It is inexcusable. And it didn’t happen overnight.
Too many voices in America? No. We need them all. But we must be diligent in the setting of priorities and that’s a task for enlightened leadership.
Creativity is intimately connected to free speech. We need them both for ideas to fully flourish.
And while China continues to steal technology from the West, it is astonishing to see how they will not acknowledge the connection that makes it happen.
They know they have been enriched by trade with the West but are not willing to try and imitate the social and economic conditions that lead to such products, preferring to foist on the Chinese people a controlling system designed to preserve the elite’s political power at all costs.
To see China today, is to see a nation taking advantage of material advances but shrinking from their responsibility to mature politically.
The problem with immature political systems is that they turn violent on a whim. As is the sad case of Putin and Ukraine today.
Both China and Russia stand as examples of leadership manipulating their citizens.
As such they both should be subjects of study for all us here in America, since we also have witnessed recent serious attempts to manipulate us into believing false ideas.
Such study will show us how much we have got right and how much that can go wrong if we’re not on our game.
I would not want to live in any other political system than the one we have, but there is no doubt that we are a work in progress.
Democracy is a fragile affair, easily undermined by those whose main interest is their personal power.
Vigilance should be constant, and the journey worth every fight.

A quick aside:
On my way back home the other day, I saw a man standing at a corner holding an umbrella. I went up to him and said, ‘You’re making a statement with that umbrella.’
‘I am?’ he replied, amused.
‘Yes. You’re telling us that men also have sensitive skins.’
He laughed.

Good Night

Oscar Valdes, medium.com, anchor.fm, buzzsprout, apple an google podcasts

Xi Jinping Replies to Elsa (3) Nothing Will Stop Us

Dear Elsa:

I am glad to hear from a person interested in world affairs and with a specific interest in our country.

There are some thinking mistakes that you make, but it is understandable because your people lack the political education we have.

China is fond of America. How can we forget your great victory in WWII? And you are right. We have learned much from you and will continue to do so. We have learned more from you than you from us.

We understand that we have to borrow from the West to expedite our development. All Chinese know that. We do not see it as stealing. We see it as the price outsiders must pay for doing business with us and profiting from our great markets.

Now and then we will sign a trade agreement saying that we will not insist that a foreign country establishes a partnership with a local one, but that is just to get you to come over. Once you are here and see the benefits of working with our superb labor force, then you will not complain when we start copying your techniques to establish our own enterprises. Eventually, our own companies will outcompete you because we will make the product better and cheaper.

China is a much older country than America. You have not suffered like we have at the hands of foreign powers that came to repress and abuse us. And it is not only foreign powers that have brutalized us, we have been brutalized too by our own internal divisions.

But we have learned.

The world now knows that Chinese labor is the best in the world. The world also realizes that we are very creative. You mentioned our going to the moon. Did you know that we didn’t get help from any nation? That is right. We did it all on our own.

You mention censorship. The Chinese understand that this is simply part of a phase of development and they are willing to sacrifice.

The Chinese people also understand that human beings’ tendency to disorder – which I call human entropy – is at the root of individualism and its inevitable excesses. To counter this negative tendency, we created a collective system that is fast becoming the envy of the world. Our collective system works because it leads to greater creativity and a sense of national purpose. And it is this, along with our political discipline, what gives vigor to our common purpose and one day will make us the strongest nation in the world.

Yes, you are right. China wants to do that. And Elsa, there is nothing that can stop us.

America will not be able to. You love our products. You want more, not less.

Businesspeople from everywhere want to come here to work and invest. Like you say in America, this is where the money is.

In time, the Yuan will replace the dollar as the premier reserve currency for the world. That will be a great day. I may not see it but you will, for you are much younger than me.

I am proud to be China’s leader. Proud to lead a nation willing to sacrifice for our children and grandchildren as we march together toward an ever brighter future.

We can do it and will, for we have learned the power of patience and hard work.

May serenity and bliss be always with you.

Xi Jinping

Chairman

People’s Republic of China.

Founded October 1, 1949

oscarvaldes.net oscar valdes@widehumr oscarvaldes.medium.com

Taxes and Motivation. High or Low Taxes?

It is a question at the core of our system of governance. And it splits us into two camps.

Let’s start with low taxes.

There is something immensely appealing to the idea. You get to have more money in your pocket to do as you wish. You can start a business, put it in the bank, invest it, save to buy a home, take a vacation, enjoy a sideline or do nothing.

You are in control and it feels great.

The person who chooses to start a business is a creator of jobs. Those people employed by the new business will be paying their own taxes, and unless the money is put under the mattress, that money is circulating and generating more business activity.

You would think that the money from low taxes spurring so much business activity would be enough to take care of the welfare of the community. Unfortunately, it is not.

The majority of small businesses fail.

So it falls to government to invest in the community and its basic unit, the family, and to do that it must collect taxes from the businesses that succeed or borrow money.

Those investments are long term and its profits are measured in the quality of citizens produced.

But you and I are not in control. We have delegated the task and it doesn’t feel the same as having the money in our pocket.

It takes an effort to conceptualize how the money paid in taxes goes to work for each of us. You or I may go years without needing the help of police or emergency services, if at all. But we do use our roads and freeways daily.

Is there waste in government? Yes. (And we have to keep trying to reduce it)

But there is waste in any business endeavor, which is why good managers are worth their salt.

So, should we favor low or high taxes?

It depends on the condition of our communities.

We are not alone in our journeys.

If there is poverty, if people are not getting a good education, if they are not getting enough to eat, if they are dying from drug overdoses, if there is a high rate of unemployment, if people are begging on our streets, if they don’t have a place to live, if they can’t get health care, if there are large numbers of people in prison, if there is racism in the land, then there’s something wrong.

We can always look at people failing in life and say to them, ‘it’s your fault. Your fault you’re poor, your fault you’re begging or uneducated, your fault you don’t have a job or a place to live or health insurance, your fault you’re on drugs, you’re fault you’re in prison.’

And yes, sometimes it will be entirely their fault, or they are partly to blame, although sometimes not at all.

Blaming, however, opens the door to punishment and to closing the argument.

There is another way to look at people who are failing in life.

And that is to look beyond blame and offer a helping hand, as in saying, ‘let’s get up brother, let’s get up sister, let’s get you up on your feet and back to functioning. We’ll talk about blame later.’ (If we don’t then whatever mistakes were made will get in the way again.)

Large scale problems cannot be solved by churches or Goodwill or the Salvation Army or other philanthropic organizations, though all try and have great merit.

Large scale problems need government to act. Government with the consent of the people.

If we have healthy communities and families, then we will be producing better citizens, and there will be fewer people in prisons, and the nation’s productivity will be higher, and more people will start businesses and create jobs and pay taxes.

If we accomplish that, then we might consider lowering taxes and see if the center holds.

And if it doesn’t then we would have to raise them again.

Do high taxes lower incentives to start a business?

For some, yes. But not for those with the resolve to do something with their lives. Not for those with the conviction they have something to offer and the energy and inclination to take chances.

There is a divide between those willing to take chances and those who are not. Just as there is a divide between those with greater ability and lesser ability. That’s the way the world is.

We are not equal in terms of capacity or motivation.

But all of us should have equality of opportunity so we can develop whatever nature gave us. That is an essential feature of a healthy society.

The person who is given opportunity and, after putting in the effort, does not get to shine in their field should be able to say, ‘I did the best I could. Let me accept what the exercise of my abilities did grant me and enjoy my life.’

Equality of opportunity will not create equality of accomplishment. It will not because of the differences in people’s capacities and motivation.

Equality of opportunity can, however, narrow the gap that exists between those who accomplish more and those who accomplish less.

When people have had opportunity to develop whatever their abilities, then they have fewer reasons to complain about the disparity in outcomes.

People can still turn around and find something or someone to blame for the disparity, but sooner or later the person is bound to come to terms with the facts. Sooner or later the person has to look at themselves and say, ‘I managed to get this or that but I couldn’t get the other. Maybe I didn’t try hard enough or maybe it wasn’t in the cards.’

Sooner or later, the weight of the evidence, the wisdom of age, or a combination of the two will bring the person acceptance. And they will stop blaming. And get on with their lives and try something else.

Self acceptance is crucial in our path to gaining a sense of peace in our lives. I’m talking self acceptance after you’ve tried really hard, got knocked down, got up and tried again.

So back to people’s motivation.

If a person really wants to make cupcakes because they feel they have a special knack for it, then they ought to try making cupcakes. Or software. Or a new shoe or pencil or bicycle or table or music stand or paper cup or kite or new vehicle. Or help someone make it, for that is just as essential.

People who start businesses in our communities enrich our lives. And so we have the eateries, cafes, cleaners, bookstores, locksmiths, plumbers, electricians, roofers, carpenters, auto mechanics, ice cream parlors etc.

And on a different scale, there is Elon Musk having the time of his life transforming Tesla into a thriving car company in a field that seemed closed to competitors. Success was not a safe bet. He had to take a chance. And now he’s even sending rockets into space. So I ask you, do you think that Elon would have chosen to stay home and count the money he made in PayPal if taxes on business ventures were higher?

No.

So, high taxes or low taxes?

The answer will need to vary according to the state of our communities, for they let us process our shortcomings, encourage risk taking and help us become better people, people who feel they’re part of what is being built.

A writer tucked away in his apartment, toiling by himself as he spins out stories needs others to get them published and read.

Elon Musk would not have built Tesla or Space X without first creating a community of highly skilled people, people with skills he does not have. People who came from healthy communities and for whom being part of a grand effort was worth their time and energy.

The writer and Elon both need a community to get their dreams out.

So, high taxes or low taxes?

High taxes might dissuade some from taking a risk on starting a new venture, but the strongly motivated will try anyway.

Low taxes that are not mindful of the health of the community, encourage waste and take away precious resources needed to improve our lives.

Meanwhile, our political leaders need to strive to build bridges between the more and the less capable amongst us for, in the end, we need everyone.

Oscar Valdes is the author of Psychiatrist for A Nation. Available on Amazon.

Oscarvaldes.net

On China

If we had been in China’s shoes, and it had been us having to offer the cheap labor, land and tax concessions to lure a better developed nation to come in with their expertise and set up factories and the like, we would have done exactly what China has done. We would have learned all there was to learn so we could copy what the more advanced nation was doing and then improve on it. And we would have stolen ideas and pressured them so as to gain an advantage as soon as possible.

Forty years of fast development and China is now a power to contend with. More than that, they are challenging us for world dominance.

Xi Jinping had the daring to announce the 2025 project for his nation to be tops in technology and robotics.

Something wrong with that?

China can’t dare to be tops if they’re not willing to invent and surpass us doing so.

Is there something wrong with wanting to be the best you can be?

China does not have the freedoms we have but they’re choosing to forgo them in the interest of economic and military advancement. At some point they will have to reckon with that but for now they’re pushing ahead.

In response, some sections of our country have chosen to panic. ‘We can’t let them do that, no, put tariffs on them, hold them back!’

Does that sound American to you?

It does not.

It seems to me that, aside from their lack of freedoms, in terms of their sheer ambition and willingness to work for it, China has become more American than us.

And rather than see their rise as a challenge and focusing on better developing and revamping our society, we’re choosing to bellyache. Put another way, some sections of our country are filled with envy of China.

Instead of rushing to our fellow Americans who were left behind by the initial phase of globalization and say to them, ‘here we are with all the training and support needed so we can transform you into world class workers,’ we instead have decided to complain that the Chinese want too much, that they need to stay ‘in their place,’ and tariffs is just one way to keep them in check.

But that strategy is cheap and, additionally, it won’t work. Forever and ever we’ve been the champions of free trade, now the envy of China makes us give up on what we have valued dearly.

Afraid to compete? Yes.

We have freedoms that they don’t have, but we’re not using them to answer their challenge.

We have been a magnet for talent from all over the world but now are paying attention to the chant of ‘send them back’ and believing it.

Immigrants have been an engine of progress but we are paying attention to voices that say ‘why can’t our immigrants look more like Norwegians?’

We have been a cradle for relentless innovation but now, some sections, are choosing to run scared.

Enough of it!

Our openness to the world has always been a treasure. Our willingness to be creative a source of immense pride.

China’s challenge should be welcome, not scorned. We can meet the challenge. But it will take for the bold and imaginative amongst us to step front, and for the resentful and short sighted to step aside.