By Doug Kelly, CEO of the American Edge Project
Three media reports this week alone show China’s determined, “whole of society” effort to surpass the United States as the global technology leader. If Washington lawmakers don’t respond by accelerating U.S. innovation and supporting our domestic tech sector, we run the risk of surrendering our tech edge to China – and with it, geopolitical leadership.
China announced this week it will restructure its vast science, technology, and finance efforts in order to achieve more scientific breakthroughs and speed up development of strategic technologies. Its priorities include innovation, basic research, and translating those efforts into practical applications. It also seeks to improve its patent and intellectual property systems.
The realignment, announced during the annual legislative and political meetings of Chinese Communist Party (CCP) leaders, aims to boost the country’s self-reliance in key industry and technology areas – especially semiconductors after the United States imposed tough new export sanctions on chip components and software on China.
This week’s move to bolster innovation follows the release of an independent report last week detailing how China has surged ahead of America in 37 of 44 categories of critical technologies, with China approaching a near-dominant position in some technologies.
A spy trial in Cincinnati lifted the veil on how pervasive and systematic China’s tech and economic spy efforts are against the United States.
For decades, China focused on stealing military secrets, but in the 1980s, China’s government expanded those efforts to target commercial technologies. China further accelerated these espionage efforts after the 2015 release of Beijing’s “Made in China 2025” program, designed to make China the world’s top manufacturer in 10 areas, including robotics, artificial intelligence (AI), and other strategic technologies.
China uses numerous methods to obtain sensitive and proprietary intellectual property (IP), including 1) acquiring American firms with the technology; 2) coercing U.S. firms to share trade secrets for access to the Chinese market; 3) outright theft through cyber- and phishing attacks; and 4) the hosting of contrived academic and industry conferences in China to facilitate knowledge exchanges with industry experts from outside of China. These conferences are often operated by Beijing’s intelligence services.
All of this acquired technology and IP is then used to strengthen China’s military and to create China-based businesses that have open access to the full Chinese market, with no revenues going to U.S. companies.
In addition to China’s high-altitude spy balloons, American officials are growing concerned that giant Chinese-made cranes operating at numerous U.S. ports across the country – including several used by the military – could provide Beijing “a possible spying tool hiding in plain sight.”
One specific Chinese state-owned company makes nearly 80 percent of the ship-to-shore cranes used at U.S. ports. These cranes come pre-assembled, operate on Chinese-made software, and are often supported by Chinese nationals working on two-year visas.
Officials are concerned that the sophisticated crane sensors can monitor port logistics, including U.S. trade patterns and partners, and send that information back to Beijing’s government. Additionally, some cranes may have remote operating capabilities which could potentially disrupt the U.S. supply chain. The concern is founded. In 2021, the FBI discovered intelligence-gathering equipment on board a cargo ship delivering the same Chinese state-owned company’s cranes to the Baltimore port. A multi-agency analysis on Chinese port cranes is due at the end of this year.
How American Lawmakers Need to React
General Jack Keane said China’s spying presence is “comprehensive,” and “President Xi has said time and time again that he sees the United States as a declining power and he wants to replace it as the world global leader and to do that, he must dominate economically, militarily, and…they must dominate technologically and geopolitically.”
Rather than weaken America’s tech industry through short-sighted legislation, U.S. lawmakers at all levels should work to spur additional innovation, thwart China’s espionage efforts, re-shore or friend-shore critical supply chain items, extend America’s version of an open and accessible internet more widely across the globe, and aggressively counter the spread of “digital authoritarianism.” This agenda is ambitious but will best protect the national security and economic prosperity of America and her allies, and the values we hold dear.
Doug Kelly is the CEO of the American Edge Project, a coalition of nearly two dozen organizations dedicated to advancing and protecting American technology and innovation.