West Virginia’s relative poverty isn’t an effect of California’s enormous wealth. The better way to look at it is to consider how much poorer the Mountain State would be minus all the advances hatched in California, and for that matter around the world.
What matters is that people are producing, not where they’re producing. The more that “hands” and machines the world over are productive, the better the odds that American hands get to realize their enormous potential. Trade is not war, rather it’s mutual enrichment that makes war less likely.
It’s something left and right in the U.S. seemingly need to be reminded of. In an opinion piece last week for the New York Times, left-leaning investor Steven Rattner wrote in downcast fashion about how “we are not winning” in the alleged battle for economic supremacy with China. Unfortunately, it’s not just Rattner who writes of China’s economic growth as a threat, and it’s not just those on the left.
Over at the Wall Street Journal, an unsigned editorial titled “The Political Battle for AI in Space” addressed the possibility of data centers in space, and powered from there. It’s an exciting prospect, but the Holy Grail of free market opinion expressed worry that U.S. progressives would block the advance in such a way “that hamstrings America’s space development and gives China an upper hand.”
About those interfering in American innovation, shame on them. Economic freedom pales only to personal freedom in importance. Where the Journal goes off track is in bringing China into its analysis. More realistically, the best argument for progressive meddling is that it will cause China to do for us so that we can do something else. Short of the Chinese literally hoarding their advances, we’ll enjoy them here as though they were created here.
It doesn’t matter if China gains an “upper hand” in the powering of AI from space. Better yet, what is an “upper hand” in commerce? Tick tock, tick tock…
Free market types have long explained that success in the marketplace is a consequence of meeting and leading the needs of buyers. Whether China is “winning” as Rattner puts it, or gaining an “upper hand” as the Journal’s editorial page puts it, both outcomes will enrich Americans if markets in the U.S. remain open to foreign production.
It can’t be said enough that the creation of smartphones in Cupertino, internet search capabilities in Mountain View, and chips powering artificial intelligence (AI) in Santa Clara don’t bring harm to West Virginians. The power of work divided is well documented.
More important, work divided doesn’t lose its luster when Chinese workers are part of the division. Put another way, the greatest amount of winning doesn’t emerge from individuals in countries competing to do the same work, but instead from individuals in countries doing the work they do best, while importing the productive fruits of others doing what they do best.
Which is why left and right would do well to separate the certain negatives about China’s governance from the production of the governed in China. The Chinese people aren’t producing in abundance to kiss off the world’s biggest market, nor could they. Products buy products, and so long as the Chinese sell their wares, they’ll reach Americans as though they were produced stateside. Which is the point, or should be.
Production is its own global reward exactly because wealth is created, not taken as left and right increasingly intimate. Which means the biggest threat to the U.S. isn’t Chinese economic progress, but a lack of it.
