The situation in the Middle East is greatly improved now that we have an administration that is not reading Thomas Friedman. Since it is difficult to be wrong about everything, we are happy to point out that Friedman’s recent analysis of China’s economy seems clear and cogent.
Yet, if you belong to the chorus of shrieky schoolgirls and the Republican senators who think that China is the root of all evil, Friedman’s observations will not make you happy.
Anyway, Friedman traveled to China to visit the Huawei corporate headquarters. One recalls that David Goldman, no leftist he, visited the same campus and came away with a similar observation.
I’d never seen anything like this Huawei campus. Built in just over three years, it consists of 104 individually designed buildings, with manicured lawns, connected by a Disney-like monorail, housing labs for up to 35,000 scientists, engineers and other workers, offering 100 cafes, plus fitness centers and other perks designed to attract the best Chinese and foreign technologists.
Friedman thinks that he is seeing the future. At the least, he is seeing our competition. It represents the Chinese response to our efforts to cut it off from our technology:
The Lianqiu Lake R. & D. campus is basically Huawei’s response to the U.S. attempt to choke it to death beginning in 2019 by restricting the export of U.S. technology, including semiconductors, to Huawei amid national security concerns. The ban inflicted massive losses on Huawei, but with the Chinese government’s help, the company sought to innovate its way around us. As South Korea’s Maeil Business Newspaper reported last year, it’s been doing just that: “Huawei surprised the world by introducing the ‘Mate 60’ series, a smartphone equipped with advanced semiconductors, last year despite U.S. sanctions.”
Huawei followed with the world’s first triple-folding smartphone and unveiled its own mobile operating system, Hongmeng (Harmony), to compete with Apple’s and Google’s.
And, the country has moved ahead smartly in the use of A. I. technology:
The company also went into the business of creating the A.I. technology for everything from electric vehicles, self-driving cars and even autonomous mining equipment that can replace human miners. Huawei officials said in 2024 alone it installed 100,000 fast chargers across China for its electric vehicles; by contrast, in 2021 the U.S. Congress allocated $7.5 billion toward a network of charging stations, but as of November this network had only 214 operational chargers across 12 states.
So, China installed 100,000 chargers for electric vehicles, whereas we have managed some 214. Hmmm.
In the past Friedman had approved of tariffs. He is less optimistic about their use today. Allow him his thought:
For starters, that view completely misses the fact that virtually every complex product today — from cars to iPhones to mRNA vaccines — is manufactured by giant, complex, global manufacturing ecosystems. That is why those products get steadily better and cheaper. Sure, if you are protecting the steel industry, a commodity, our tariffs might quickly help. But if you are protecting the auto industry and you think just putting up a tariff wall will do it, you don’t know anything about how cars are made. It would take years for American car companies to replace the global supply chains they depend on and make everything in America. Even Tesla has to import some parts.
Now, those who hate China believe that it cheated. To some extent this is true. To some extent it is not. When China began modernizing several decades ago it required foreign companies to share technology. It is not exactly the same as stealing.
Accusing China of cheating is also a markedly hostile remark, one that is not likely to foster comity or amity:
But you’re also wrong if you think that China only cheated its way to global manufacturing dominance. It did cheat, copy and force technology transfers. But what makes China’s manufacturing juggernaut so powerful today is not that it just makes things cheaper; it makes them cheaper, faster, better, smarter and increasingly infused with A.I.
One reason China is doing well is simple. It has emphasized STEM education and is producing a vast supply of human capital to advance the country economically and technologically.
China starts with an emphasis on STEM education — science, technology, engineering and math. Each year, the country produces some 3.5 million STEM graduates, about equal the number of graduates from associate, bachelor’s, master’s and Ph.D. programs in all disciplines in the United States.
As the Times Beijing bureau chief, Keith Bradsher, reported last year: “China has 39 universities with programs to train engineers and researchers for the rare earths industry. Universities in the United States and Europe have mostly offered only occasional courses.”
In the world of high-speed rail travel, China is far ahead of us:
Over 550 Chinese cities are connected by high-speed rail that makes our Amtrak Acela look like the Pony Express.
For our part we consider it sufficient to hate China. Detaching from China means that we are missing out on their technology:
As Han Shen Lin, an American who works as the China country director for the Asia Group, put it to me over breakfast at Shanghai’s Peace Hotel, “DeepSeek should not have been a surprise.” But, he continued, with all the new U.S. “overseas investment restrictions and disincentives to collaborate, we are now blind to China tech developments. China is defining the tech standards of the future without U.S. input. This will put us at a serious competitive disadvantage in the future.”
Finally, we are making sure that China does not gain a foothold in America. But, at what price?
For instance, on March 19, the Texas Senate gave initial passage to a bill that would bar residents of and organizations based in China, Iran, North Korea and Russia from owning property in Texas. Putting China on that list is just stupid: Hey, let’s ban some of the greatest brainpower in the world instead of laying out incentives and conditions for them to invest in Texas.
Needless to say, this is not the prevailing American wisdom. And yet, are we really as competitive as we think we are? And would be gain nothing from detente?