Written by: Visakh Madathil
As a trade war between the world’s two largest economies heats up, a colder, arguably more consequential, battle ravages. The United States and China are locked in a divisive battle for technological superiority and the United States is threatening to fall behind.
Chinese and American firms have been mired in conflict for years, and their respective governments have done little to help quell the flames. Earlier this year, the Trump administration accused the Chinese government and technology firms of stealing American technological know-how as a justification for tariff expansion.
China routinely refuses to allow American companies from accessing the Chinese market, like Facebook and Twitter, or forces companies to make cumbersome investments, such as requiring Apple to set up a new data center. American regulators regularly block Chinese attempts to buy American firms. Chinese firms are suspected of espionage and locked out of American markets, as Huawei will attest.
These attempts to handicap each other’s technological innovators is justified on national security and economic grounds. The deep mistrust and competition between the United States and China make present tensions difficult to solve. Mutual angst and distrust cause each country to parallelly innovate and build technology.
While the United States currently possesses the upper hand, its lead is quickly disappearing, and it may be discomforting to think of the consequences if China snatches it. The nation that first unlocks the power of 5G, Quantum Computing, and AI will not only enjoy significant economic gains, but will also be able to yield considerable geopolitical power.
China has mobilized human, financial and scientific capital much more effectively than the United States through the Made in China 2025 and Belt and Road initiatives and other various national technology strategies. The United States government has yet to match the funding and vision provided by its Chinese counterpart. If the United States continues this path, it is in serious jeopardy of forever falling behind.
All the current signs seem to indicate that the next international order will be defined by strong nationalistic tendencies and the unraveling of the post-World War II order. In this world, geopolitical leverage will be just as important as it was in the years leading up to the Second World War. If the United States wants to ensure a central role in this new, upcoming order it must commit to continue being the world’s technological innovator.
Visakh is a junior studying Economics at SMU. He is also the Executive Director of the Tower Center Student Forum.