“”China spent roughly $173 billion in subsidies to support the new energy-vehicle sector, which encompasses electric and plug-in hybrid vehicles, between 2009 and 2022,” write Kubota and Leong. By 2019, there were 500 E.V. manufacturers in China. But that same year, the government started paring back those incentives, and by 2023, the number of automakers had shrunk by 80 percent.
Now, though, the country is ready to throw good money after bad: “Chinese leader Xi Jinping has called on local leaders to promote ‘new productive forces’—a buzzword in Chinese policy circles for the need to promote high-value manufacturing industries.” Local leaders responded by pumping money into struggling companies—in one case, giving the equivalent of $27.5 million to a company that had sold fewer than 2,000 cars in the first quarter of 2024.
“China currently has the capacity to produce some 40 million vehicles a year, though it sells only around 22 million cars domestically,” the Journal authors warn. As a result, the country’s largesse “is adding cars to a global market that risks becoming more oversupplied.”
Of course, E.V.s are not inherently a bad idea—especially in China, whose cities have a history of such severe pollution that it lowers the nation’s life expectancy.”
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“But as with anything, the advent of clean-energy technology should be driven by market forces. The Chinese government spent more than a decade subsidizing the production of electric vehicles, no matter whether consumers wanted to buy them. When the spigot of free money finally shut off, and manufacturers had to stand on their own, the country saw the rise of “E.V. graveyards,” in which entire fields were covered in unsold or abandoned vehicles.
America would do well to heed China’s example as a cautionary tale about industrial policy. China averaged 9.8 percent annual economic growth for 35 years starting in 1978; in 2013, officials pledged to keep growth at 7.5 percent—a two-decade low for the country, even if it would have been an enviable figure for any other nation.
But much of that expansion was driven by government spending, not market forces: For much of the 21st century, China embarked upon a construction binge, building residential and commercial developments as fast as possible with no regard for whether there were any tenants to fill them.
The result was China’s “ghost cities,” full of high-rise apartments and shopping centers in which nobody lived. Worried about rising debt, the Chinese government finally started drawing back its building spree in 2020. Since then, the country’s real estate market has cratered, and its debt load has only deepened.”
“Britain’s signals intelligence spy chief raised eyebrows this week with warnings that Russia is coordinating both cyberattacks and physical acts of sabotage against the West. There’s evidence to back her claims—and the West may be returning the favor. Coming soon after FBI Director Christopher Wray warned that China is targeting American infrastructure, it looks like the world is not only fracturing once again, but that the hostile blocs are engaged in covert warfare.”
“After a student leader of the historic Tiananmen Square protests entered a 2022 congressional race in New York, a Chinese intelligence operative wasted little time enlisting a private investigator to hunt for any mistresses or tax problems that could upend the candidate’s bid, prosecutors say.
“In the end,” the operative ominously told his contact, “violence would be fine too.”
As an Iranian journalist and activist living in exile in the United States aired criticism of Iran’s human rights abuses, Tehran was listening too. Members of an Eastern European organized crime gang scouted her Brooklyn home and plotted to kill her in a murder-for-hire scheme directed from Iran, according to the Justice Department, which foiled the plan and brought criminal charges.
The episodes reflect the extreme measures taken by countries like China and Iran to intimidate, harass and sometimes plot attacks against political opponents and activists who live in the U.S. They show the frightening consequences that geopolitical tensions can have for ordinary citizens as governments historically intolerant of dissent inside their own borders are increasingly keeping a threatening watch on those who speak out thousands of miles away.”
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Beijing’s publicly released military budget is inaccurate and does not adequately capture the colossal scope and scale of China’s ongoing military buildup and wide-ranging armed forces modernization.
After accounting for economic adjustments and estimating reasonable but uncounted expenditures, the buying power of China’s 2022 military budget balloons to an estimated $711 billion—triple Beijing’s claimed topline and nearly equal with the United States’ military budget that same year.
Equal defense spending between the United States and China plays to Beijing’s benefit. As a global power, the United States must balance competing priorities in the Indo-Pacific and elsewhere, which spreads Washington’s budget thinly across multiple theaters. Meanwhile, each yuan China invests in its military directly builds its regional combat power in Asia.
America’s spy community has confirmed that Beijing’s defense spending is on par with Washington’s, but questions remain. The intelligence community’s estimate of China’s $700 billion in annual military expenditures needs more transparency to better convey Beijing’s military budget breakdown and inform policy debates regarding US defense spending investments, gaps, and imbalances.”
“U.S. Secretary of State Antony Blinken criticised on Friday Chinese support for Russia’s defence industry, saying Beijing was currently the primary contributor to Moscow’s war in Ukraine though its provision of critical components for weaponry.
He said this effort was fueling “the biggest threat to European security since the end of the Cold War.”
Speaking at a news conference capping the end of a gathering of G7 foreign ministers on the Italian island of Capri, Blinken said Washington had made it very clear to Beijing and others that they should not be aiding Russia’s war effort in Ukraine.
“When it comes to Russia’s defense industrial base the primary contributor in this moment to that is China. We see China sharing machine tools, semiconductors, other dual use items that have helped Russia rebuild the defense industrial base,” Blinken said.
“China can’t have it both ways. It can’t afford that. You want to have positive, friendly relations with countries in Europe, and at the same time, you are fueling the biggest threat to European security since the end of the Cold War,” Blinken said.
The U.S. has warned China not to aid Moscow’s war effort since Russia’s full scale invasion of Ukraine in February 2022, which came just weeks after Russia and China declared a “no limits partnership.”
German Foreign Minister Annalena Baerbock echoed Blinken’s concerns.
“If China openly pursues an ever closer partnership with Russia, which is waging an illegal war against Ukraine, … we cannot accept this,” Baerbock said after a meeting with her G7 counterparts in Capri.
U.S. officials briefed reporters earlier this month on materials China was providing to Russia, including drone and missile technology, satellite imagery and machine tools, that fall short of providing lethal assistance but were helping Russia build up its military to sustain its two-year-old war in Ukraine.”