The Old Developing China Just May Have Developed

The Old Developing China Just May Have Developed

And Perhaps is Overtaking the United States Where We Arrogantly Do Not Expect It

One of the nastiest parts of Sino-American relations, even back when it seemed we were getting along… enough to make China our leading trading partner… was the People’s Republic’s bad habit of stealing our intellectual property, mandating that US companies doing major business in the PRC share patent information and literally sending cadres of industrial spies into every major relevant tech company they could. China also offered ethnic Chinese academics at major American Universities the laboratory of their dreams, a research budget and staff support beyond anything they could achieve in the US, plus status and lifestyle nonpareil.

As we faced an aging military infrastructure and equipment in need of upgrade or replacement, with some of the highest labor costs on earth, China was pretty much designing their future from scratch. China also really need not need to deploy a massive naval force all over the globe, as we had; they simply needed to deploy heavily only in their region, where they currently out-gun the United States. Yet we contemplate how we can protect our east and southeast Asian allies from PRC threats, given China’s expanding extraterritorial claims. Like that new military base, a man-made expansion in the Spratley chain in the South China Sea. Just based on the number of vessels, China’s modernizing navy is larger than our own.

If you want to feel even less secure, Russia’s recent naval display in Cuba, four vessels, represents a Chinese ally with very serious weapons technology. Two of those ships, the frigate Gorshkov and nuclear super-submarine Kazan, are among the most advanced ships in the Russian Navy and can be armed with a variety of precision and hypersonic anti-ship and land attack guided missiles. Exactly the weapons our Navy is most concerned about. China is also pouring money into such upgrades; many here believe both nations may actually be ahead of us in those areas.

With that explosive Chinese economy accumulating a massive dollar-based trade surplus, all the sanctions in the world were beginning to have little or no impact on China’s ability to fund technology growth and sophistication, often building on purloined US patents. One way or another, perhaps by invading Taiwan, the PRC will have those super microchips they still cannot make. While the US military has a more sophisticated military, more advanced weapons research and manufacturing expertise for the most complex systems, China is throwing so much money and training at this sector that they are threating to eclipse the United States… and in some arenas… already have as noted above.

It seems that notwithstanding a massive American commitment to scientific research and education that began under Republican President Dwight Davis Eisenhower in reaction to the 1957 Soviet launch of the first earth-orbiting satellite, Sputnik, as the years passed, American priorities have changed. Wars in Vietnam, the Middle East and Central Asia sapped our economy. Ignoring the proven economic axiom “guns or butter” (we erroneously assumed we could change the “or” to “and”), pressures to keep taxes on the rich low convinced us to fund these economy-sapping efforts by incurring a rapidly rising deficit. Even after these wars ebbed, the slogans that sounded good but was consistently proven false – “incent the job creators,” “trickle down economics,” and “a rising tide floats all boats” – became accepted (though false) mantras that defined GOP basic policy for the last few decades. We were/are living on past investments by prior generations but borrowing our future away to avoid taxing the rich. Huge mistake!

China had no such idiotic revenue policies (though they had lots of other idiotic policies). They funded scientific research and education, continued to steal western technology, and truly accelerated their sophistication into the future. They are more heavily invested in hypersonic weapons and artificial intelligence than we are. As the June 13th The Economist puts it: “If there is one thing the Chinese Communist Party and America’s security hawks agree on, it is that innovation is the secret to geopolitical, economic and military superiority. President Xi Jinping hopes that science and technology will help his country overtake America. Using a mix of export controls and sanctions, politicians in Washington are trying to prevent China from gaining a technological advantage.

“America’s strategy is unlikely to work. As we report this week, Chinese science and innovation are making rapid progress. It is also misguided. If America wants to maintain its lead—and to get the most benefit from the research of China’s talented scientists—it would do better to focus less on keeping Chinese science down and more on pushing itself ahead… In commercial innovation China is also overturning old assumptions. The batteries and electric vehicles it exports are not just cheap, but state-of-the-art. Huawei, a Chinese telecoms firm brought low after most American firms were barred from dealing with it by 2020, is resurgent today and has weaned itself off many foreign suppliers. Although it earns a third of the revenue of Apple or Microsoft, it spends nearly as much as they do on R&D.

“China is not yet the world’s dominant technological power. Huawei still has limited access to advanced chips; self-sufficiency is costly. The country’s many state-owned firms are sclerotic. Much of the spending on research is guided by the state’s heavy hand. And some mediocre universities still produce mediocre research. China’s innovation, in other words, is inefficient. Yet it is an inefficiency that Mr Xi is willing to tolerate in order to produce a sheaf of world-class results.

“All this poses a dilemma for America. With more good science comes new knowledge that benefits all humanity, by solving the world’s problems and improving lives, as well as deepening understanding. Thanks to China’s agronomists, farmers everywhere could reap more bountiful harvests. Its perovskite-based solar panels will work just as well in Gabon as in the Gobi desert. But a more innovative China may also thrive in fields with military uses, such as quantum computing or hypersonic weapons. It will also aim to convert its technological prowess into economic and diplomatic influence.

“So far America has focused on the threats, by trying to stymie China using sanctions and by limiting the flow of data, talent and ideas. After all, hawks say, China is itself notoriously secretive. It failed to share its early work on the virus that causes covid-19, a shocking breach of its responsibilities that could have cost lives—possibly millions of them. If Chinese science is thriving thanks to these tactics, then perhaps America should simply be even harder line and more restrictive.

“That overestimates America’s ability to constrain the whole of Chinese science. Even Huawei has prospered despite foreign sanctions. And it underestimates the cost to America’s own science—including the technology that underpins its security. Rather than copy China’s tactics, America should sharpen its own innovative edge, by enhancing the traits that made it successful.” As we tariff China’s super inexpensive cars so Elon Musk can pay himself mega-billion-dollar annual compensation, we force US consumers to pay through the nose, are effectively delaying implementing the EV infrastructure we need… and still US consumers cannot buy those $12,000 EV cars.

I’m Peter Dekom, and if we want to preserve our economic and political power, we need to start taxing wealth, stop polarizing bickering/fostering conspiracy theories, and get back to basics: STEM education with massive, related R&D, the real job creators and growth stimulators!