First, America’s equity privilege is not an independent source of power. It rests on the continued competitiveness of U.S. technology champions, their excess returns on capital, and their perceived growth runway. Once America’s relative technological competitiveness begins to decline, this so-called equity privilege becomes water without a source. Capital-market depth can amplify industrial and technological advantage, but it cannot substitute for it.
Second, China may not yet have a vertically integrated space champion like SpaceX, but its long-term potential in space is larger. One reason is China’s mixed state-private mechanism: state-owned and private players develop in parallel, creating a dual-engine model. By contrast, the U.S. government space ecosystem represented by NASA has clearly lost much of its old institutional strength.
Another reason is that China’s private space sector is using a wolf-pack strategy. More than a dozen companies are attacking different technical problems, competing fiercely, and iterating quickly. This is very similar to what happened in China’s auto industry. China did not produce one Tesla; it produced an entire swarm of highly competitive EV companies.
Chinese commercial-space companies also receive very high valuations in China’s own capital market. So the real question is not whether China lacks a SpaceX today. The deeper question is whether a decentralized, competitive, state-supported Chinese space ecosystem may eventually prove more powerful than America’s dependence on one mythologized super-company.
Thanks for the comment. I'd offer that American equity privilege, which the piece defines as the world's persisting desire to own stakes in American firms and list on American exchanges, is a function of both U.S. private-sector competitiveness and strong U.S. securities regulation, which together have produced the market's depth and strength. On whether China can produce its own space champion: my point was that such a firm would be unlikely to list on a U.S. exchange in the current environment, so it would need to find that scale of capital elsewhere.
The article has two blind spots.
First, America’s equity privilege is not an independent source of power. It rests on the continued competitiveness of U.S. technology champions, their excess returns on capital, and their perceived growth runway. Once America’s relative technological competitiveness begins to decline, this so-called equity privilege becomes water without a source. Capital-market depth can amplify industrial and technological advantage, but it cannot substitute for it.
Second, China may not yet have a vertically integrated space champion like SpaceX, but its long-term potential in space is larger. One reason is China’s mixed state-private mechanism: state-owned and private players develop in parallel, creating a dual-engine model. By contrast, the U.S. government space ecosystem represented by NASA has clearly lost much of its old institutional strength.
Another reason is that China’s private space sector is using a wolf-pack strategy. More than a dozen companies are attacking different technical problems, competing fiercely, and iterating quickly. This is very similar to what happened in China’s auto industry. China did not produce one Tesla; it produced an entire swarm of highly competitive EV companies.
Chinese commercial-space companies also receive very high valuations in China’s own capital market. So the real question is not whether China lacks a SpaceX today. The deeper question is whether a decentralized, competitive, state-supported Chinese space ecosystem may eventually prove more powerful than America’s dependence on one mythologized super-company.
Thanks for the comment. I'd offer that American equity privilege, which the piece defines as the world's persisting desire to own stakes in American firms and list on American exchanges, is a function of both U.S. private-sector competitiveness and strong U.S. securities regulation, which together have produced the market's depth and strength. On whether China can produce its own space champion: my point was that such a firm would be unlikely to list on a U.S. exchange in the current environment, so it would need to find that scale of capital elsewhere.