Let’s assume the Trump White House blacklisting of Huawei in effect marks the beginning of a full-fledged Tech Cold War between America and China, complete with a Digital Iron Curtain. The full metaphor. How then does the conflict end in an American victory? And what does that even look like? Have the tech cold warriors, both within the White House and externally, given serious thought to any of this?
We know how the more comprehensive Cold War 1.0 concluded, with the dissolution of the Soviet Empire in 1991. It was a collapse that some predicted was inevitable. But at the time many others thought the scenario so unlikely as to be unworthy of speculation. The whole idea of 1970s detente was based on the perceived durability of the USSR. And this view held nearly to the very end. For example: The 1984 film “2010: The Year We Make Contact” was a sequel to the 1968 Stanley Kubrick-directed film “2001: A Space Odyssey” and concerns a joint US-USSR deep space mission.
As it turned out, of course, Hollywood was wildly optimistic about the sustainability of the Soviet enterprise, although hardly alone in that view. The Soviet Union didn’t have a decade left, much less a generation or more. The USSR’s centrally planned industrial economy, which benefited for decades as workers moved from field to factory, had hit a wall. It was an economy without a second act. The lack of competition removed the “invisible foot” of failure, so crucial to innovation. And the planners made plans that made no sense, choosing to double-down on heavy industry. While stagnation may not have been the prime cause of the collapse, it hardly conveyed a message that the Soviets were running the superior model.
“Capitalism with Chinese characteristics” — more open, more entrepreneurial — seems to work better. So much so that some American policymakers worry about China replacing the US at the frontier of some key advanced technologies such as AI, robotics, and quantum computing. (I mean, Huawei does make a pretty good smartphone.) And somewhat quarantining China’s tech ecosystem might well slow its progress as China seeks to become tech independent from American components.
But then what? It’s unclear that the rest of the world is nearly as gung-ho about this tech containment strategy. Nor have the downsides — whether heightened risk of war or economic damage from reworking supply chains and Chinese retaliation — been explained to the American people. This, for instance, from The Wall Street Journal:
The US has sharply slowed approvals for the nation’s semiconductor companies to hire Chinese nationals for advanced engineering jobs, according to industry insiders, who say the delays are limiting access to vital talent. … It is significant in part because Chinese nationals account for a large share of non-US citizens hired for such technical roles, where the talent supply domestically is often scarce. The slowdown in approvals also shows the conundrum US companies face in navigating the US stance toward China on technology: Decisions aimed at protecting US competitiveness in one way could hamper it in another.