[readhn]

I completely understand Chinese (or any other country) entrepreneurs, why let some foreign company come in and take all the money (ultimately a lot of it outside the country) when you can do the same internally. The idea is not a rocket science, all about execution. And locals know the specifics of China more than a bunch of silicon valley grads.

Cheers to these guys for making it work in China. And Good luck to Uber fighting strengthening competition all around the world.

[aianus]

> why let some foreign company come in and take all the money (ultimately a lot of it outside the country) when you can do the same internally.

Because those engineers and entrepreneurs could have spent their time producing something globally new and innovative instead of creating an Uber clone. Then they could have sold that new thing to the world and everyone (global consumers and the aforementioned Chinese) would be better off than the status quo.

[notahacker]

Or - considerably more likely - they could have created a significantly less successful Uber clone, like many engineers and entrepreneurs have managed in other countries where Uber operates. I mean, if it were that easy to come up with revolutionary new business models that the entire world needs, we wouldn't see quite so many cookie cutter startups in Silicon Valley either...

Actually, the more plausible arguments against protectionism and state aid for favoured corporations are the precise opposite to the one you're making: it's good for consumers to have a wider choice of ride-booking apps, and not a choice guided by the government. If the ridesharing apps are likely to tend towards being a monopoly anyway then there certainly are advantages to having it a locally owned and run one.

[adventured]

The question becomes what the consequences of that should be. Since you're arguing in favor of elaborate protectionism, that becomes a central issue.

Should Xiaomi be artificially blocked from selling smart phones in the US? Should all Huawei products be blocked? Should the policy of the US Government be to directly assist Apple versus Samsung (or any other competitor) in the US market? Should the US begin directly subsidizing immense steel production, using the US Dollar reserve currency to intentionally bankrupt China's steel producers via Fed printing to pay for it all? To what extent should the US be using the US Dollar to destroy foreign corporations to gain a competitive advantage? Or better yet, using the NSA to do so. How far should protectionism go?

Should the US use the dollar to start massive state enterprises, printing dollars to pay for it all, to buy up foreign corporations. For example, maybe the US should create a massive potash conglomerate from a state owned enterprise backed by the Fed directly. Then use some USD printing to merge up with other big potash players around the world, and use political leverage and threats to force other nations into allowing those mergers. Japan for example has been buying up its own stock market, maybe the US should go a step further than that. If China wants to compete using big state owned enterprises, why shouldn't the US respond in kind, and then some? China also directly funds non-state owned enterprises through various banking channels. Maybe the Fed should be providing 0% interest loans to US corporations to advantage them to acquire specific major foreign competitors for essentially no cost.

Should the Fed provide Apple, Microsoft, Amazon, Google, etc. with a nearly unlimited budget to begin manufacturing all of their hardware & components in the US, along with perpetual subsidies to keep that production local? Might as well take advantage of available leverage.

If not, then why is it ok for China's government to set up intentional barriers to entry or to encourage rather drastic dumping policies in several big industries? Should foreign companies not be allowed to buy majority ownership positions in domestic US corporations? Should the US Government deny all attempts by foreign corporations to buy domestic corporations? Why is it considered ok for China to directly advantage and subsidize so many massive state enterprises, if the US and other nations aren't supposed to behave that way?

Should the US Government look the other way, while a major US entrepreneur steals tens of billions of dollars from a Chinese company, as Jack Ma did with Yahoo and AliPay? Is that the kind of protectionist playing field that is desirable?

Facebook, Twitter, Google and numerous other US companies have been directly blocked from competing in China in all sorts of ways. Which companies of China's should the US be blocking in response to that?

[chrischen]

Because Uber invests most of their money on US soil, on US engineers, that go back into the US economy.

They just want to release an app that harvests money from Chinese consumers.

So if China can protect a local company that will clone uber, but with the difference of investing in local human capital and infrastructure, why not take that opportunity?

[adventured]

Why shouldn't the US begin very aggressively promoting its own domestic corporations, directly, at the expense of foreign companies as well then? Using all means available to the US Government to do so.

Nobody here that is saying it's great for China to protect its local ecosystem, will think it's ok for the US Government to do likewise and doing everything in its means to leverage its particular advantages in favor of companies.

How about the Fed set up a US manufacturing fund. Instantly create a trillion dollar sovereign fund out of thin air, to decimate or buy-up foreign manufacturing competition. Of course the Fed wouldn't be so obvious about it, you'd want other nations to be the frog getting boiled in the pot, you want them to go to sleep with assurances that it's nothing sinister. Next thing you know, Tesla is getting $100 billion in free capital to go after BMW and Mercedes with subsidized vehicles. Or maybe the US should start a state owned lithium enterprise and buy up all the lithium supply, and use the leverage in the Western Hemisphere, to block out all foreign access to lithium in South America. And leverage all of that into a huge benefit to domestic electric car production. China did the same thing with rare earth metals. Or how about Uber get a 0% loan from the Fed for $50 billion, to go after the rest of the world (examples intentionally exaggerated). Those are the sort of policies that China has in place right now across numerous major industries.

[chrischen]

This is Trump's campaign platform, which is to start protectionism for the US. And I agree, it would be a necessary step. You can bitch and whine about other countries being protectionist, but the appropriate response is to actually do it yourself (in the US).

[HillRat]

So if China can protect a local company that will clone uber, but with the difference of investing in local human capital and infrastructure, why not take that opportunity?

China is the textbook beneficiary of global free trade -- as Donald Trump's candidacy shows, there's significant appetite amongst the American electorate for renewed protectionism. Certainly many voters think (wrongly, I would argue) that Chinese manufacturing "harvests money" from American consumers.

Having said that, I don't think there's any evidence that the Chinese government put an anticompetitive thumb on the scales against Uber. That doesn't mean there's a level playing field for Western companies in China, but Uber's failure can be chalked up to a number of strategic missteps.