Is Profit Maximising Profits the Ultimate Good?

This week on Dead Cat, Reed Albergotti — the technology editor for the soon-to-be launched media startup founded by Ben Smith and Justin Smith — joined the show to talk about the Biden administration’s executive orders shaping how the U.S. does business with China.

Albergotti reported earlier this month that the Biden administration is looking to crack down on American investors cutting checks in China.

He wrote for Semafor:

Administration officials were particularly alarmed this March by a report in The Information that the Chinese arm of the Silicon Valley venture firm Sequoia Capital has begun raising a new, $8 billion fund for investments in Chinese technology, according to people close to the administration. A Sequoia spokeswoman declined to comment.

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The details of the order could still change, but the administration has considered at least two ways of dealing with U.S. investments in China. One approach would be to require disclosures for any investments in semiconductors, artificial intelligence, quantum computing and potentially other industries like rare earth minerals and electric cars. The other would be to set up a system that would give the government the ability to block investments outright, in the way that the Committee on Foreign Investment in the United States can block inbound investments from China and other countries.

A third option being discussed by those involved is to do both. Biden could require disclosure and then, if something problematic arises, take further action to block it. That option is more appealing to U.S. companies and could be just as effective.

Relatedly, the New York Times reported on another executive order that would expand the power of the Committee on Foreign Investment in the United States to block Chinese investments in the United States. The Times reported that the executive order “directs the committee to consider whether a pending deal involves the purchase of a business with access to Americans’ sensitive data, and whether a foreign company or government could exploit that information.”

Albergotti helped make sense of the Biden administration’s various executive orders — both planned and announced.

Albergotti, with co-hosts Tom Dotan, Katie Benner, and Eric Newcomer, speculated about whether a TikTok ban was forthcoming and reflected on Senator Josh Hawley’s TikTok grandstanding.

In the latter half of the episode, we turned our attention to Patagonia owner Yvon Chouinard’s donation of the outdoor clothing retailer. We discussed the New York Times’ glowing coverage of Chouinard’s donation.

Or was the media being unnecessarily dour? Was the media being too skeptical by declaring that Chouinard had avoided $700 million in taxes by giving his company away and by comparing him to the shadowy donor Barre Seid, who donated his device manufacturing company to support conservative causes?

Give it a listen.

Read the automated transcript