Theft as Trade Policy
The most important dimension of U.S.–China relations is technology, which is vital to economic, military, and even ideological competition.
In the economic competition, the main American challenge is not, as is sometimes implied, inadequate innovation. The U.S. is the world’s wealthiest country by tens of trillions of dollars. The number of U.S. patents granted to Americans set a record in 2019 and nearly matched it in 2020. That more than tripled the number of patent granted to second-place Japanese filers in our market.
The main challenge is not even Chinese innovation. Beijing’s preference for large firms and state funding at the expense of genuine competition ensures it will struggle in key areas, from aircraft development to shale. The main challenge is China’s acquisition of intellectual property (IP) and use of regulatory and financial subsidies to develop products from that IP to drive the U.S. out of global markets.
Chinese government-linked hackers have tried to steal sensitive data from some three dozen manufacturing and technology firms in the US, Europe and Asia, security researchers said Wednesday, in findings that shed new light on Beijing’s alleged use of hacking to buttress its powerhouse economy.
American officials said that they were monitoring China’s progress in meeting the terms of a 2020 trade deal, but that intellectual property owners had expressed concerns.