Regarding the stealing of technologies, while it is generally agreed to be a big threat (1 in 5 North America-
based companies in a 2019 CNBC Global CFO Council survey claimed to have had intellectual property
stolen by Chinese companies3), it does not fully explain actions taken against Chinese tech companies. If a
company is breaking a law within a country (e.g., Huawei in the US) one would expect to see that crime
prosecuted legally so one could see the evidence that shows the spying devices embedded within the technologies.
We aren’t seeing this. Fear of growing competitiveness is as large or larger a motivator of the attacks on Chinese
technology companies, but one can’t expect policy makers to say that. American leaders can’t admit that the
competitiveness of US technology is slipping and can’t argue against allowing free competition to the American
people, who for ages have been taught to believe that competition is both fair and the best process for producing
the best results. As a practical matter stealing intellectual property has been going on for as long as there is
recorded history and has always been difficult to prevent. As we saw in earlier chapters the British did it to the
Dutch and the Americans did it to the British to make themselves more competitive. “Stealing” implies breaking a
law. When the war is between countries there are no laws, judges, or juries to resolve disputes and the real reasons
decisions are made aren’t always disclosed by those who are making them. I don’t mean to imply that the reasons
behind the United States’ aggressive actions are not good ones; I don’t know if they are. I’m just saying that they
might not be exactly as stated. Protectionist policies have long existed to protect companies from foreign
competition. Huawei’s technology is certainly threatening because it’s better than American technology. Look at
Alibaba and Tencent and compare them with American equivalents. Americans might ask why these companies are
not competing in the US. It is mostly for the same reasons that Amazon and a number of other American tech
companies aren’t freely competing in China. In any case, there is a tech decoupling going on that is part of the
greater decoupling of China and the US, which will have a huge impact on what the world will look like in
five years.
What would a worsening of the tech war look like?
Still, the United States has a technology lead (though it’s shrinking fast). As of result, as of now the Chinese
have great dependencies on imported technologies from both the US and non-US sources that the US can
influence. This creates a great vulnerability for China, which creates a great weapon for the United States. It
most obviously exists in advanced semiconductors, though it exists in other technologies as well. The dynamic
with the world’s leading chip maker—Taiwan Semiconductor Manufacturing Company, which provides the
Chinese and the world with needed chips and which can be influenced by the United States—is one of many
interesting dynamics to watch. There are many such Chinese technology imports that are essential for China’s
well-being, and much fewer American imports from China that are essential for the United States’ well-being. If
the United States shuts off Chinese access to essential technologies that would signal a major step up in war
risks. On the other hand, if events continue to transpire as they have been transpiring, China will be much
more independent and in a much stronger position than the United States technologically in 5-10 years, at
which time we will see these technologies much more decoupled.