Technology transfer

First, a brief excerpt from
Chapter Nine of Eamonn Fingleton’s In the Jaws of the Dragon
(the emphasis is added;
for the specific context, click here):


It is easy for Beijing to arrange business conditions
so that huge profits are virtually guaranteed
for any compliant American corporation.
It is a process that makes shooting fish in a barrel
seem like a fair challenge.
In return for the license to print money in China
(at least for the duration of the next few quarters),
American corporations merely have to
transfer crucial technologies to Chinese soil.

For just a few years of profits,
America is giving away a technological inheritance
that took generations to accumulate.

Deprived of its reserves of proprietary production know-how,
the United States loses most of its comparative advantage in world markets.

Now that virtually all restrictions on the movement of America capital
have been abolished,
there is generally no reason anymore why
corporate America should invest at home.

Better to invest abroad, particularly in China,
where the government makes it so easy
for the collaborationist-minded to turn a profit.

Neither the American nation nor the American workforce
has had any influence over the process.
Even American shareholders are not consulted—
and if the truth were frankly disclosed to them,
they would in many cases oppose the deals
as undermining their long-term interests.

The big gainers are in the first instance
just a few thousand top corporate executives
who reap huge returns via bonuses and stock options.
[But not far behind are the investors.]
Meanwhile, bloated short-term corporate profits make possible
an orgy of influence buying not only in Washington
but in the American media and in the universities.
The silence of designated whistle-blowers must be bought,
thus obviating any risk that a suddenly aroused American people
might intervene to stop
the looting of the nation’s industrial patrimony.

Now for some articles from the media:


GE ‘all in’ on aviation deal with China
By Howard Schneider
Washington Post, 2011-08-23


Studies by the U.S. Chamber of Commerce
have criticized what the organization calls
an intricate network of Chinese state policies
meant to
acquire as much technical capacity as possible from abroad
in hopes of advancing China beyond being a source of cheap labor.

[A good point,
but it would have been both respectful and helpful to have pointed out
the extensive previous writings on this subject, especially
Eamonn Fingleton, In the Jaws of the Dragon, 2008, and
Clyde Prestowitz, The Betrayal of American Prosperity, 2010.]


GE’s joint venture with AVIC will employ about 300
engineers, software designers and others in the United States.
If all goes as planned, it could boost GE’s fortunes in the avionics field,
where it now ranks fourth behind market leaders such as Honeywell.

The number of jobs to be created in China would be much higher.
GE executives say it is difficult to imagine otherwise.
The “colonial” model — of
multinationals making products in the developed world
and selling them to the developing world —
is long outdated, they argue.


[What deceitful sophistry.
First, colonialism involved political control, in particular, sovereignty,
over other regions and peoples.
Second, calling something “outdated” begs the question
of why, what, and who made it that.
There is no immutable master clock that determines
when economic models must change.
That is a willful, political act by the interested parties.]

G.M. Plans to Develop Electric Cars With China
New York Times Business, 2011-09-21

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