By Doug Kelly, CEO of American Edge Project
As China makes rapid gains in artificial intelligence (AI) and begins wiring the world to easily adapt its version of AI, the United States Department of Justice (DOJ) and the Federal Trade Commission (FTC) are in deep discussions on which agency should take the lead in investigating U.S. AI companies for alleged anticompetitive activities, according to a new report from POLITICO. The report stated, “neither agency is ready to relinquish jurisdiction.”
This misguided interagency regulatory infighting comes at a critical time — the United States and China are in a hard-fought, winner-take-all battle for global technology leadership. For decades, the United States was the undisputed leader in innovation, but over the past decade, China launched a $1.4 trillion plan to dethrone America as the global technology leader, with a focus on advanced microchips, AI, 5G and 6G wireless, and other strategic technologies.
Numerous independent analyses show that China is making great progress towards its goal. An Australian study found that China leads the U.S. in 37 of 44 strategic technologies tracked in a year-long project that examined 2.2 million data points. Similarly, a Harvard University report found that China is well ahead of the United States in high-tech manufacturing and 5G, could soon beat the U.S. in quantum computing. A study from The National Security Commission on Artificial Intelligence found that China is poised to overtake the United States as the world leader in AI by 2030.
The stakes could not be higher in this global tech competition. Technology power is increasingly geopolitical power. The winner of this competition, which experts say will be decided over the next decade, will enjoy a lasting advantage in national security, economic prosperity, and increased influence in setting global tech standards and advancing their version of how technology interacts with society.
The American version of technology in society mirrors our democratic values: open, accessible, and supportive of democracy, free speech, and expression. China’s stands in stark contrast, with its closed, censoring, and controlling technology mirroring its Communist government’s actions.
From an economic standpoint alone, AI will have an estimated global impact of $15 trillion by 2030. The decisions we make today at the federal, state, local, and international regulatory levels will largely determine which country – the U.S. or China – is best positioned to realize those gains and the millions of jobs that will be created from AI advancements.
Unfortunately, it’s not just U.S. regulators who have misguided priorities when it comes to the U.S.-China tech race. The European Union’s (EU) competition authorities – working hand-in-hand with our own FTC – are also targeting the leading U.S. tech companies with stringent new regulations while largely exempting European and most Chinese tech companies. Many other countries are following suit with their own EU-like restrictions targeted towards American tech companies.
While Western policymakers focus on rule-making, China is actively adopting a “proliferation-first“ strategy in setting global norms for AI. This effort involves the aggressive integration of Chinese AI technologies into emerging economies, prioritizing this over the establishment of specific international regulations. Currently, over 140 cities worldwide are being enhanced by Chinese technology, evolving into “safe cities” and “smart cities” that use AI to significantly improve traffic management, logistics, and law enforcement. This approach positions China to have its AI systems become globally dominant, similar to its strategy with the worldwide implementation of Huawei’s 5G telecommunications infrastructure.
We’ve seen this movie before. Short-sighted policy decisions surrendered our manufacturing edge to China and cost America five million manufacturing jobs and 70,000 manufacturing plants over two decades. We cannot make the same mistake with technology because technology is not just another sector – it’s the essential backbone of everything that matters in our lives – security, prosperity, democracy, and our core values.
Lawmakers and regulators need to pivot from targeting America’s top innovators to strengthening the private sector’s innovative capacity, which is a critical element of America’s international leadership. A united, bipartisan effort across multiple administrations is vital for outpacing China in the strategic technology race and for ensuring that America remains the global innovation leader for decades to come.