Why China isn’t an innovation powerhouse
October 24th, 2013
10:23 AM ET

Why China isn’t an innovation powerhouse

By Guy de Jonquières, Special to CNN

Editor’s note: Guy de Jonquières is a senior fellow at the European Centre for International Political Economy. This article is based on his recently published paper, Who’s Afraid of China’s High-Tech Challenge?

Some of the sheen may be wearing off China’s miracle growth story as it faces a growing array of economic challenges. But the country’s drive to become an innovation powerhouse and global leader in science and advanced technologies continues to inspire shock and awe abroad.

China has already overtaken the United States and Japan to become the largest recipient of patent applications and is forecast to outstrip the U.S. as the biggest source of scientific publications by 2020. Its universities turn out about 2 million engineering graduates annually, more than any other country.

Beijing’s plans are more breathtaking still. The most far-reaching is the Strategic Emerging Industries initiative, which is backed by state funding of as much as $2 trillion over five years and aims to leapfrog today’s global leaders in sectors such as clean energy, information technology, biotechnology, advanced manufacturing and new materials.

However, as so often in China, all is not quite as it seems. Surging national patent applications, it turns out, have been spurred less by an explosion of innovation than by numerical government targets for filings and lavish state incentives to ensure they are met. This looks suspiciously like a case of “Never mind the quality, just feel the weight.”

In 2011, for example, fewer than a third of patent applications in China were classified as “innovation” patents, and these accounted for only one tenth of all patents granted between 1985 and 2010. Studies have also found patents granted to Chinese owners generally to be of lower quality than those held by non-Chinese.

More from GPS: Why American innovation will beat out China's

The difference is reflected in the huge imbalance between the income China receives from foreign royalties on patents it has issued – $1 billion in 2011 – and its $18 billion royalty payments that year to patent holders abroad. Though internal technology transfers by multinational companies to their Chinese affiliates account for some of the $17 billion deficit, China clearly still relies far more on imported technologies than on those it has developed itself.

The country’s fast-growing research and development efforts will be critical to closing that gap – and China is certainly throwing money at the problem: last year, it spent almost $300 billion on R&D, second only to the United States and more than Japan and Germany, the next two largest spenders, combined.

However, R&D spending measures only input, not output, which is what matters to technological and industrial success. By that yardstick, there are many questions about how well China performs. It possesses many clever – even brilliant – scientific brains and engineers. But they are minority. A 2008 study by Duke University found engineering degrees in the U.S. were generally superior to those in China, while all but a few of 80 companies worldwide surveyed in 2005 by McKinsey, the management consultancy, judged U.S.-educated engineers to be far more employable than those educated in China or India.

Other constraints also hinder R&D in China. In its universities, intense rivalry for career advancement among researchers has led to widespread academic plagiarism and corruption; fear or intolerance of failure, especially in the large state sector, tend to deter imaginative risk-taking, while political repression of dissent and an education system heavily based on rote learning hardly encourage original thinking and creativity.

More from CNN: Can Apple win over China?

Innovation also involves far more than invention. It requires the ability to translate laboratory breakthroughs into successful products and services that tap into market demand. That, in turn, means harnessing a far wider and more complex combination of skills and capabilities than just technical competence.

A widely-used indicator of a country’s progress towards that goal is Total Factor Productivity (TFP), which measures all the economic inputs that cannot be explained by productivity of capital and labor: for example, technical skills, management capabilities, organizational competence, accumulated knowhow and the ability to apply as well as to develop technology.

In the decade or so up to 2007, China achieved rapid annual gains in TFP. Since then, however, they have fallen by as much as half. A recent study by Ernst & Young, the accountancy firm, says that instead of moving closer to the “technology frontier” – the TFP benchmark set by the most advanced economies – China is slipping steadily further away from it.

If China is to fulfill its leaders’ dreams of dominating world markets for the products and services of the future, it will need capable companies to deliver them. It boasts some nimble, enterprising and fast-growing technology companies, such as Huawei in telecom equipment and Baidu, Sina and Alibaba in online services, which have been adept at pioneering new markets. But they are still few in number and many have yet to venture far beyond China’s borders.

So how should China respond? To breed more industrial winners, the country needs to overcome several self-inflicted handicaps. Perhaps the biggest is a highly unbalanced economy that depends excessively on fixed asset investment – about half of GDP – for growth. This is the result of a skewed financial system that floods banks with abundant artificially cheap capital, much of which is then lent to manufacturers, construction companies and property developers. The system, combined with local governments’ frenzied efforts to boost growth and employment, has spawned massive excess capacity, eroding borrowers’ profitability and their capacity to repay mounting debt.

More from CNN: Should you look for work in China?

The economy is distorted further by political favoritism, which channels preferential financing and many other privileges to the state-owned enterprises (SoEs) that dominate many sectors of the economy. However, the SoEs are slow-moving and far less efficient than the private companies that are the main innovators and pace-setters in many of China’s high-tech growth markets. Indeed, some studies have found that collectively the SoEs destroy, rather than create, wealth.

China’s new leadership, headed by President Xi Jinping and Premier Li Keqiang, are well aware of the need to tackle these problems. Effecting change, however, means confronting an array of thorny challenges, starting with entrenched resistance from the many politically powerful interests that profit handsomely from keeping things as they are. It’s still unclear which way the battle over reforms now raging in the ruling Communist party will go.

Another of China’s disadvantages is that few of its companies yet possess an international presence or much experience of operating abroad. Most lack globally recognized consumer brands and the marketing expertise and distribution channels needed to control the downstream activities where established western competitors often earn much of their profit.

Increasingly, Chinese companies are seeking to make up for those deficiencies by acquiring businesses in the West. But despite the state’s deep pockets and a reputation for paying fancy prices, that route can also be an obstacle course. Many “crown jewel” foreign companies aren’t for sale – and if they are, Chinese bidders can run into local political opposition or barriers erected on national security grounds, especially in the United States.

Far from being poised to sweep to global dominance in innovation and high-technology, China is still struggling to catch up with the established world leaders. It has made some notable progress, including breeding some resourceful and fast-growing companies. However, many of these advances have been achieved in spite of, rather than because of, China’s state and its extensive control over the economy.

Whether China can ever produce fundamental breakthroughs or innovators to match Thomas Edison, Henry Ford or Steve Jobs remains an open question. What is increasingly apparent, though, is that China’s capacity to transform the global order in science and technology depends critically on its ability to confront tough challenges it faces at home.

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Topics: China • Technology

soundoff (118 Responses)
  1. Nelson

    15 years ago! Why did USA betrayed Great Britain. Hong Kong would never have been lost to Chinese, without US betrayal. Now, USA and Great Britain, both NATO members, cannot trust each other. No one can trust USA after this betrayal.

    October 24, 2013 at 10:37 am | Reply
    • FR

      Nelson,

      If you expect one nation to spend blood and treasure to guarantee what another nation originally grabbed from China in a successful war fought over the right of British merchants to profitably addict Chinese to opium, you have another think coming.

      Happily, virtually all Brits nowadays vehemently disagree with you, so Amis and Brits get along great. Except when a certain G.W.B. and T.B. go crazy over Iraq. But, hey, even the best of relationships have their rough spots! We live and learn, together.

      October 24, 2013 at 11:29 am | Reply
      • Carl

        The British may have taken Hong Kong by force, but it was never legally owned by the Chinese communist government until the Brits gave it to them. The communist army sought to take Hong Kong by force, along with everything else, with no more legitimacy than the British.

        Hong Kong should have been either given to the Republic of China based on Taiwan, or made a permanent independent state. Gifting it to the commies was ridiculous.

        October 24, 2013 at 6:37 pm |
      • j. von hettlingen

        To start with, China has to instil a new spirit of volunteerism. Children should be inspired to learn and not forced to do so. China should take a look at schools in Finland and Sweden, where children are taught to explore and develop.

        October 25, 2013 at 8:31 am |
    • scourge99

      Its cliche how any criticism of the Chinese is ignored and the US or some other nation is brought up to distract from the point. Apparently Chinese commentators aren't familiar with the Tu Quoque fallacy.: http://en.wikipedia.org/wiki/Tu_quoque

      October 24, 2013 at 12:26 pm | Reply
      • Really?

        Just like how tian an men's brought up for every argument? When the US done way worse in recent years? i.e. the wars in ME, spying on the global, MIC complex etc... It's not distracting from the problem, when you have no moral or ethical grounds of bring it up in the first place.

        October 24, 2013 at 12:38 pm |
      • scourge99

        @Really

        Thank you for demonstrating the tu quoque fallacy in all its glory. Let me copy and paste what the tu quoque fallacy is since you seem unwilling or unable to learn about it on your own:

        tu quoque fallacy – the appeal to hypocrisy, is a logical fallacy that attempts to discredit the opponent's position by asserting the opponent's failure to act consistently in accordance with that position; it attempts to show that a criticism or objection applies equally to the person making it. This dismisses someone's point of view based on criticism of the person's inconsistency, and not the position presented, whereas a person's inconsistency should not discredit their position. Thus, it is a form of the ad hominem argument. To clarify, although the person being attacked might indeed be acting inconsistently or hypocritically, this does not invalidate their argument.

        October 24, 2013 at 2:09 pm |
    • johnny

      They are set to out do us there, because they keep stealing our own designs and plans with cyber warefare. If we invested in that when we started the world wide web and pioneered it, contructed a great security for it, we would be in these shoes. But China got on their patent/idea stealing game, so now they just need to log in, steal plans, make them chinese and voila

      October 24, 2013 at 12:52 pm | Reply
      • Maersk

        The Chinese must have hacked into you azz and stolen your virginity. As a result, your azz is still bleeding. Even though you are in agony you still enjoy it, am I right?

        October 25, 2013 at 2:32 pm |
    • juanmoretime

      Read your history, there was no betrayal. In 1898, the British and Chinese governments signed the Second Convention of Peking, which included a 99-year lease agreement for the islands surrounding Hong Kong and Hong Kong, called the "New Territories." The lease expired, so in honoring that agreement, Britain had to relinquish the territory.

      October 25, 2013 at 1:24 am | Reply
      • Mark

        You're partly correct. In the Convention, Britain took a 99-year lease on the New Territories, which occupy 86.2% of Hong Kong's land area. Britain did own Kowloon and Hong Kong Island in perpetuity due to the 1842 treaty ending the Opium War. However, keeping only the islands and Kowloon would have been problematic, as water supplies and other things are located in the New Territories.

        February 9, 2014 at 10:20 am |
    • Don Task

      Nelson, what are you talking about? Hong Kong was leased to Britain for a certain period of time, and when that lease expired in 1997, it became Chinese again. It was known for a long, long time before it happened. The return of Hong Kong was a properly executed deal.

      October 25, 2013 at 1:45 am | Reply
      • Huw

        Hong Kong island, Kowloon and some other parts were not leased. They were ceded in perpetuity.
        The New Territories were leased. Big difference. Thatcher was persuaded/forced (against her better
        nature) to sign a deal to return the whole package rather than just the New Territories.

        October 25, 2013 at 2:25 am |
  2. Jack 2

    They don't need to be innovative. Our American corporations selll us out and trade China our tech for cheap labor.

    October 24, 2013 at 11:55 am | Reply
    • Yes1fan

      I don't think it's limited to strictly American Corporations, but at this point, also Global Corporations, who have written off the U.S. as an object to be plundered to suit their own whims.
      No longer multi-nationals, they now consider themselves beyond the reach of mere country boundaries & rule.

      October 24, 2013 at 12:29 pm | Reply
    • Maersk

      You sound like an innovative American kwok zucking kwok zucker. Can you please show us how innovative your kwok zucking skill is?

      October 25, 2013 at 2:36 pm | Reply
  3. chrissy

    Agree with Jack 2! Corporations that send jobs overseas for cheap and most times child labor should be made to pay extra taxes for these actions! If one really put some thought into it it would even appear to be a form of treason against the american citizens! And if they were charged extra taxes it may deter them from shipping jobs out!

    October 24, 2013 at 12:20 pm | Reply
    • Daniel Daronda

      My dear Chrissy, it is much worse than you think it is............ not only did our wonderful American and European CEO's give over 100 million jobs (on a silver platter!!!!) to Asia, over the last 20 years, but in the last 12 months, there has been approx 2 TRILLION US dollars sitting in Asian banks, that is owned by US Corporations, and that US Corporations are required to pay taxes on, if they want to transfer these funds into America.......... well guess what.......... those same greedy, profit motivated CEO's, have recently negotiated a secret "back door" deal with our wonderful politicians in Washington DC (and the IRS!!!!), to bring all that money back into the US, without paying one red cent in taxes!!!!!!!!!!!!!................ and this, at a time when the money coming in to our government coffers is less than half of what the government is spending every year............. shameful beyond imagination........ and how many Americans are aware of this??????????

      October 24, 2013 at 4:54 pm | Reply
    • Sk

      We aren't in China but we are stationed in South Korea they tax everything that is imported heavily. So when you buy foreign you think twice about it. So most of the time locals buy local. But in America buying something from Asia is cheaper and we don't hesitate. I think we should have that same tax and the see how fast American production comes back.

      October 25, 2013 at 12:05 am | Reply
  4. mrglobal

    China is still emerging. the people there are as bright as anywhere else. It's emerging from chaos, for corruption and pollution and a stringent political system. Since 1980, their achievements are obvious to see. To say China is not innovative is true but only relative to where it is in this point in time. However, it's improving leaps and bounds. DO NOT underestimate China. The US education system is lousy and for those who take "comfort" in this news story better wake up.

    October 24, 2013 at 12:21 pm | Reply
    • rolly

      What does education have to do with anything? Two of the best minds that came out of the U.S. had no college education.. make that 3. Steven Dell, Bill Gates and Steve Jobs. China doesn't have the free thought to think outside the box to generate this type of thinking.. They are too busy pushing their kids through books.. These kids will be great worker bees for the future American Corporation founders..

      October 24, 2013 at 2:28 pm | Reply
      • NotLyingtMisstating

        Hmm, all three had college educations. None graduated with a degree.

        October 24, 2013 at 5:31 pm |
    • juanmoretime

      If the education system in America is lousy, as you say. Why are there so many Chinese coming to study in our universities?

      October 25, 2013 at 1:29 am | Reply
      • Don Task

        The U.S. education has problems at lower levels, but at the same time, much (if not most) of the very best university education in the world can be found in the U.S.

        October 25, 2013 at 1:49 am |
    • jimmy

      wish all Americans are as bright as you.

      December 23, 2013 at 2:54 pm | Reply
  5. Francoise

    Hong Kong should not had been lost to Chinese. USA has also responsibility towards NATO members. Now, if USA is not strong enough to be the leader in NATO, then maybe FRANCE can do it. Sorry, Americans, but that's not the way you can betray NATO alliance.

    October 24, 2013 at 12:22 pm | Reply
    • Really?

      Hong Kong was and still is and will be geographically a part of China. It would've been given back to China eventually since it was "rented out." Your imperialist mindset can't be fixed thus I conclude that you are part of the problem in your country. Pick up a real history book in your life time and not just eat what the press or whoever is feeding you!

      October 24, 2013 at 12:34 pm | Reply
      • Carl

        The communist government had no legal claim to Hong Kong. They were a military force which seized power. There was no voting before OR after this coup.

        Only racism could make you think that Hong Kong naturally belongs to the communists.

        October 24, 2013 at 6:42 pm |
      • Huw

        Hong Kong island, Kowloon and some other parts were not leased. They were ceded in perpetuity. The New Territories were leased. Big difference. There was no obligation to return the island or Kowloon at any time.

        October 25, 2013 at 2:28 am |
    • joe

      really fracoise. yea france can lead NATO alright but does it have resources for that? America is still the nation that donates more cash and military equipment combined. without the U.S.A there will be no nato. since they always really on our money and military. so am sorry NATO will be nothing without us. (U.S)

      October 24, 2013 at 12:53 pm | Reply
    • Rascal262

      Agreed. Without air cover from the American carriers the British ground forces never stood a chance at the Battle of Hong Kong. Don't give up the fight! We can win it back!

      October 24, 2013 at 1:19 pm | Reply
    • John

      Sorry, but there's no way that France has military or economic might to lead NATO. France already is struggling to handle the failing European Union.

      October 24, 2013 at 8:19 pm | Reply
    • juanmoretime

      France? Didn't we rescue the french twice from the Germans? No, I don't think so.

      October 25, 2013 at 1:31 am | Reply
    • Don Task

      France huh? If I remember correctly, France chose to be partly outside of the Nato Alliance (possibly not in effect any longer). Besides, I think most Nato members would feel uneasy about being led by a country more famous for not wanting to speak English with foreigners, than for the opposite. (I can imagine a rather scary scenario where Scandinavians and other NATO members speaking smaller languages are expected to answer calls in French during joint exercises... Sorry, but English is the de facto international lingua franca of today's world, and I think we'll stick with that – irrespective of some French words in this sentence.)

      October 25, 2013 at 2:06 am | Reply
  6. CW

    When they regulate Alibaba's counterfeiting out of existence than the world may take them seriously.

    October 24, 2013 at 1:34 pm | Reply
  7. snowman

    One reason is that many Chinese scholars and researchers are working in the USA!

    Look at the PhD programs in the US Universities, you probably will see more Chinese than Americans. And most of those Chinese PhDs work for the US companies after graduation

    October 24, 2013 at 1:42 pm | Reply
  8. ParanoidChinaBasher

    The Chinese are horrendous innovators !! Just think about their invention of "toilet paper". Does it really clean anyone? Always there's some residue, no matter how many times you wipe.

    October 24, 2013 at 1:52 pm | Reply
    • Fred

      Now there's an incisive post. Lateral thinking at it's best.

      October 24, 2013 at 7:48 pm | Reply
    • Maersk

      ParanoidChinaBasher, May I suggest that you stuff your azz with a Chinese made black dudo. Once you try it you will never want to go back to using paper.

      October 25, 2013 at 2:48 pm | Reply
  9. ParanoidChinaBasher

    The Chinese are horrendous innovators !! Just think about their invention of "toilet paper". I doubt this dry method clean anyone. Always there's some residue, no matter how many times you wipe. This flawed hygienic etiquette shows the limit of their ingenuity.

    October 24, 2013 at 1:59 pm | Reply
  10. sybaris

    One reason China will overtake the U.S. in S&T is that they are not bogged down by an iron age religion that promotes ignorance over education.

    October 24, 2013 at 2:09 pm | Reply
    • Will

      Yeah, Jews and Christians are just so stupid. All they ever did was create the best universities in the world and produced an ethos of critical thinking that turned the world upside down. It shouldn't be too difficult to distinguish the Sarah Palins of this world from those who have always advocated for a liberating and transformative faith. In a few years, Sarah Palin will be forgotten and people of faith will continue to speak of redemption from tyranny, stupidity and (in your case) cynicism.

      October 24, 2013 at 4:25 pm | Reply
  11. profit makes healthcare go around

    The Chinese copy but copying isn't all bad. I do my best, as a scientist, to copy what Nature has already exquisitely perfected rather than trying to engineer de novo a new solution that will take a long time, a lot of materials and may not work at all. Drug companies, for example, are finally getting smart and are screening thousands and thousands of known compounds for binding and efficacy against new targets instead of wasting time with "rational design" synthetic approaches which are most likely to fail preclinical or clinical trials. If it ain't broke, don't fix it. That's bad/impossible to patent re-use of a known drug but if it works...oh right, if it won't make money but cures illness, don't do it. This is why for-profit healthcare is a conflict of interest. For-profit requires "innovation" and patent patents.

    October 24, 2013 at 2:25 pm | Reply
  12. goodjobsamericanswant

    I avoid chinese foodstuffs, chinese dogfood and anything that may poison me or cause me physical harm becuase China is a huge superfund site and goods coming out of it are tainted with lead arsinic and other very toxic chemicals. they dont care about thier own kids– remember the infant formula scandals?
    The only reson there are more chinese PHd students is because most americans cannot afford a BS, MS and then a PhD on top of that!! I myself had to drop out of grad school and I was a top student, becuase I could not afford to live and support my son on teh wages I made working part time while going to college for my graduate degree– there are almost no scholarships for students unless they are in key programs that support big business - exxon, monsanto or BASF. Americans should be filling these R&D jobs and if we supported our education system instead of cutting it, Americans would be working in these high pay jobs instead of foreign nationals who got free undergrad educations in thier home countries and have no student loans to pay off, thus cancan accept work for less money than most educated americans with loans can afford to start at.

    We still are a nation of the best and the brightest innovators, but multi-national corporations have invaded and influence our elected officials to pass legislation that favor the hiring of engineers and scientists from other countries, leaving us americans sitting at home looking for work, any work we can find to feed our kids.... Its hard to be creative when you are shut out of jobs in your own country.

    October 24, 2013 at 2:26 pm | Reply
    • goodjobsamericanswant

      yes I know there are typos– spell check has ruined me!

      October 24, 2013 at 2:27 pm | Reply
  13. Iliketoeat

    There are two ways to success: take your own path and be innovative (not guaranteed, normally fails like the Indians); take someone else's path and do better than him (guaranteed, like the Chinese).

    To maintain your success after it has been achieved: be innovative (China has been innovative throughout history till about 150 years ago; IQ studies show that the Chinese have the highest average IQ, so when time comes, Chinese will shift their focus from copying/improving to being innovative. They have the capacity, we'll see).

    October 24, 2013 at 3:30 pm | Reply
  14. kingbaabu

    So called intellectuals always betray an uneasiness with Chinese growth at every opportunity. Why don't we give them their due instead of nitpicking to make ourselves feel good? Why?

    October 24, 2013 at 4:19 pm | Reply
  15. kingbaabu

    "Whether China can ever produce fundamental breakthroughs or innovators to match Thomas Edison, Henry Ford or Steve Jobs remains an open question." This comment is so farcical that I am not even going to dignify it with the many nobel prizes and awards in science that Chinese researchers have been decorated with. It just smacks of the arrogance of a few ignorant people who are stuck in a cold war era where scientific achievement is a zero sum- if it doesn't originate in the west then it can't be good enough.

    October 24, 2013 at 4:26 pm | Reply
    • powerof1

      This is a silly argument. Paper, magnetic compass, gunpowder, etc...originated in China. People just don't understand innovations knows no boundaries.

      October 24, 2013 at 5:45 pm | Reply
      • harish

        that last line. I like it

        October 24, 2013 at 6:01 pm |
      • rolly

        paper wasn't a chinese innovation.. It comes from the word papyrus. Greeks and other civilizations used it long before China.

        October 25, 2013 at 10:09 am |
  16. jez

    China is always cheating. What's new about this?

    October 24, 2013 at 6:36 pm | Reply
  17. David G

    China will eventually become an innovation powerhouse if followings are going to happen: 1) capital distribution model shifted heavily toward purpose driven innovation ecosystem streamlining mainly through private means; 2) IP law and order, tough love for those perpetrators; 3) Being further starved of ingenious innovations that would spring sustainable wealth and prosperity in the country.

    October 24, 2013 at 7:02 pm | Reply
  18. rightospeak

    They do OK . They are our banker.

    October 24, 2013 at 7:57 pm | Reply
  19. reality

    The asians only know how to copy instead of innovate. Everything from the far east came from the west

    October 24, 2013 at 7:59 pm | Reply
    • powerof1

      Like gunpowder, paper, and ketchup...all invented in China. I think this is why China is able to catch up so quickly. Because the people in the US don't value education or history. In the US, people waste their energy debating Creationism and Affirmative Action for college. In China, you'd to laughed at in public for wasting people's time. In China, they actually execute billionaires and politicians for corruption. In the US, it's just par for course when political and business leaders are found corrupt. Do you know what in the Chinese newspaper when the US shutdown the federal gov't? They sure weren't praising how great democracy in the US. More along the lines WTH are we lending the US so much money when they can't manage it properly...

      October 24, 2013 at 9:42 pm | Reply
    • Don Task

      "Italian pasta": Pasta was taken to Europe from China some 700 years ago by Marco Polo. Wars have been fought for hundreds of years with gunpowder – a Chinese invention. The entire western world has been eating on China-ware (porcelain) for several hundred years. Continents were discovered and settled with the help of the compass – a Chinese invention. Keep talking...

      October 25, 2013 at 2:17 am | Reply
      • rolly

        Atomic energy, telephones, space shuttles and exploration, computers, airplanes, helicopters, tanks, automobiles, electricity, need I say more? All invented in the Western world.

        October 25, 2013 at 10:11 am |
  20. tdsd

    Why innovate when it is so much easier to make money by mass producing for others? An innovative new product is not guaranteed a ready market.

    October 24, 2013 at 8:02 pm | Reply
  21. Hadenuffyet

    Attention Walmart Shoppers:
    This is what you are REALLY paying for.

    October 24, 2013 at 8:55 pm | Reply
  22. jeng

    China innovate alot, but USA propaganda media such as CNN ignore it or downplayed or even badmouth it, so......

    October 24, 2013 at 10:47 pm | Reply
    • rolly

      China regurgitate a lot.. not innovate.. They take an already U.S invention (or Russian) and apply a "made in China" sticker to it, after modifying it ever so slightly so that the patent office doesn't take it to task.

      October 25, 2013 at 10:12 am | Reply
  23. chrissy

    Thank you @ Daniel and you're i did not know that. Im not surprised though! Our present congressional children are doing their very best to ruin this country and are succeeding at a very alarming rate. Term limits and an age cap really must be visited on these "high end welfare recipients" otherwise known as congress!

    October 24, 2013 at 11:16 pm | Reply
  24. Relictus

    China not an innovator? We are still claiming special privilege. That won't last forever.

    October 24, 2013 at 11:16 pm | Reply
  25. chrissy

    Also our government needs to revisit the North American Free Trade Agreement that was signed into law in 1993. That wasnt the most beneficial thing for the US working class. And if they would concentrate on making improvements to this instead of involving theirselves in the middle east so much our country would be a lot better off. It seems its one step forward and 3 steps backward! Get it together Congress and do the job you were elected to do!

    October 24, 2013 at 11:29 pm | Reply
  26. chrissy

    That does sound like a perfectly logical idea @ sk! Just one flaw~ our government doesn't like to go the logical route! And particularly if it might interfere with their kickbacks, etc. But if they just for once, put the good of US citizens before the good of theirselves we might actually get somewhere!

    October 25, 2013 at 12:22 am | Reply
  27. RL

    I think we need to dig deeper into the meaning of American innovation too. America's innovative companies (Amazon, Apple, Facebook) create new needs rather than solving any of America's problems (which have been the same for decades: debt, inner city decline, drugs, obesity, gun crime etc). Also they don't employ very many Americans, I think Apple only employs 30,000 which is about the same as Wegmans Food Markets of New York. Apple's innovation could benefit me (a European living in Asia) more. Eg I could work for Apple in Asia, and I could own Apple stock without paying any capital gains tax.

    October 25, 2013 at 12:50 am | Reply
  28. Roy

    Well, at least China have money to buy any innovation produced by any country.
    USA or other countries may have more innovation, then they build the factory in China, then China sell it to other countries, and China got the money – well with a small percentage for the patent to other countries.
    It is just like USA as the R&D team and China as the owner of the company, in this conditions, who is the rich one?
    As for now, it is still using money to buy the candy, not the innovation.

    October 25, 2013 at 2:01 am | Reply
  29. NOYB

    Eventually the commies will FALL like a house of cards!!!!

    October 25, 2013 at 2:18 am | Reply
  30. Jerry

    the Chinese do innovate. Look here:
    http://www.theatlantic.com/infocus/2013/05/chinese-diy-inventions/100511/?fb_action_ids=10201388323251883&fb_action_types=og.recommends&fb_source=aggregation&fb_aggregation_id=288381481237582

    October 25, 2013 at 2:20 am | Reply
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