Submission + - Reed Hundt: America in China's Shadow?
Anonymous writes: In a Q&A posted at CIOInsight.com, former FCC chairman Reed Hundt (author of "In China's Shadow: The Crisis of American Entrepreneurship") says the U.S. has fallen behind in the global race for innovation. From the article:
CIO Insight: You paint a dire picture of the rivalry between Chinese and U.S. businesses. Are we in an economic war with China?
Hundt: It's a battle between groups of knights or chevaliers — thousands of American firms against thousands of Chinese-based firms. So if you worked in the textile industry, you would say, here are these 20 American firms, each battling their vigorous Chinese competition. Or if you're Cisco, you say, of course, my competition is Huawei.
And if you look at the strength that Chinese firms bring to the competition, it's significant. First of all, China is now at the same level as Japan in R&D spending, and soon will be almost at the level of the United States. Second, it's so much cheaper for Huawei to run its business than for Cisco, by a factor of ten times. And finally, China has extremely easy access to capital, and all their markets are wide open for competition, mostly because they're growing. Nothing is a mature market there. It's very vigorous domestic competition, much more vigorous than most of the American markets. There's much more of what Americans used to think America was.
CIO Insight: You paint a dire picture of the rivalry between Chinese and U.S. businesses. Are we in an economic war with China?
Hundt: It's a battle between groups of knights or chevaliers — thousands of American firms against thousands of Chinese-based firms. So if you worked in the textile industry, you would say, here are these 20 American firms, each battling their vigorous Chinese competition. Or if you're Cisco, you say, of course, my competition is Huawei.
And if you look at the strength that Chinese firms bring to the competition, it's significant. First of all, China is now at the same level as Japan in R&D spending, and soon will be almost at the level of the United States. Second, it's so much cheaper for Huawei to run its business than for Cisco, by a factor of ten times. And finally, China has extremely easy access to capital, and all their markets are wide open for competition, mostly because they're growing. Nothing is a mature market there. It's very vigorous domestic competition, much more vigorous than most of the American markets. There's much more of what Americans used to think America was.