Thought Leadership on US-China Affairs and the Theft of Innovation
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China has been making significant investments in technology and manufacturing infrastructures, advancing human capital and increasing the high-tech manufacturing capabilities of its workforce, all with the goal of becoming more effective at technology and IP absorption. US trade policy should reflect the reality that continued US economic prosperity in a global economy is predicated on China’s protection of American IP. Merely assuming that historical-determinism or trade expansion will overcome China’s resistance to protecting foreign IP rights (IPRs) is an exercise in futility. Further, the rapid growth and technological advancement of China’s economy is positioning China’s IP theft as a national security challenge.
The changing nature of how technological development is being absorbed by any economy makes this emphasis even more poignant. Decades ago, US military technologies led to follow-on innovations in the private sector. For example, research on the atomic bomb prior to the 1960s led to the development of nuclear power generation for major cities. German rocketry research from the 1940s led to NASA landing a man on the moon. British radar development during WWII led to microwave ovens and police traffic speed detectors. However, this trend reversed when commercial innovations began leading military innovations, and high-tech products were often developed with dual-use applications in mind (defense and commercial), rather than single-use (defense or commercial). To wit, the development of semiconductors and microelectronics created more than just calculators and mobile phones. These innovations led to the development of smart bombs and military drones. Today, most global positioning satellites (GPS) provide both ground traffic guidance and missile trajectory guidance. Artificial intelligence (AI) has been applied to the logistics of disease propagation as well as decoding terrorist messages.
China’s extensive use of cyber, economic, and industrial espionage, combined with the increasing globalization of technology applications in arms production and deployment, will eventually allow China to close the existing military-technological gap with the US. This is dangerous to the extent that China has not historically demonstrated restraint in the face of rising power.