WASHINGTON, February 27, 2023 – China has no reason to retaliate against U.S. export controls because it might lead to more restrictions on products which would not be in the Chinese Communist Party’s interests, said the president of US-China Business Council at a web conference on Wednesday.

In October, the Commerce Department prohibited the exportation to China of certain high-functioning chips necessary for supercomputers and moved to prevent other countries from providing China with certain semiconductors made with American technology.

The Commerce Department also limited American citizens’ ability to work with Chinese chip facilities. The restrictions were billed as a national security imperative and designed to limit the development of next-generation, chip-dependent Chinese military technology.

At the same time, the U.S. raised concerns that China would retaliate.

“China has a good number of tools or legal tools, which they could retaliate, but that’s hard,” said Craig Allen, president of US-China Business Council, a non-profit that promotes trade between the two countries. “If they do retaliate, for example, against a chip company or manufacturing equipment company, a tool company, or another type of company, then that will lead to further restrictions on the inflow of technology and a product into China. And so, they have not found a way to retaliate, that suits their interest and I hope it stays that way.”

However, China also has remarkable speed and scale, Allen said. He considers China’s manufacturing speed and scale of accessing the market as “quite formidable.”

“Their dominance in the processing of rare earths, for example, is something that we should be concerned about,” according to Allen.

Other experts on the panel had similar opinions as well.

The most advanced artificial intelligence chips go into supercomputing and equipment for the production of semiconductors, according to Jimmy Goodrich, vice president of global policy at the Semiconductor Industry Association. The export control policy is limited to the “most cutting edge technology,” Goodrich said.

“The vast majority of chips don’t depend on and applications don’t depend on those advanced technologies,” said Goodrich. “Many of those are still unrestricted, because they’re ubiquitous, China has a lot more stronger domestic capability to produce them.”

But China may already be cognizant that development of chips is a globally integrated endeavor.

“It’s too complex, too global, too interdependent for one country to be able to produce all these technologies on their own,” Goodrich said, emphasizing the importance of multilateral approach. And that could be why, Goodrich added, China is hesitant to retaliate.

WASHINGTON, February 6, 2023 – Deputy Commerce Secretary Don Graves said an event late last month that the U.S. needs to build partnerships with other countries to tilt the balance in its favor against the technological influence of China.

“This is how we’re going to build U.S tech leadership, not with silver bullets, but step-by-step with government, business, educational institutions and communities all working together to create the conditions that will drive innovation, attract investment and grow quality middle class jobs,” said Graves at the Information Technology Industry Council’s tech and policy summit on January 31.

Graves addressed a concern that China has moved aggressively to establish a technological powerhouse “through massive government support for their own domestic industries, strategic use of capital to gain access to early stage, commercial tech” and allegedly through technology theft.

Graves said the Joe Biden administration understands the need for a different approach, a modern strategy that will focus on technology that provide innovation and job opportunities. He referred to a focus on computing-related technologies comprising chips, quantum and artificial intelligence and clean energy tech, that will reduce dependence on fossil fuels and protect against the costs of climate change.

The comments come after the House voted to establish a new committee to study the competitive landscape between China and the U.S. The Federal Communication Commission has already designated major Chinese companies such as Huawei and ZTE national security threats. In order to increase independence, President Biden has signed the Chips and Science Act into law in August last year that incentivizes the domestic manufacturing of key technologies, including semiconductors.

Sen. Todd Young, R-IN, one of the speakers at the event, called on Congress to be more united when it comes to the issues with China.

“We need to become more economically resilient,” Young said. “That means hardening our supply chains,” which he said can be done using the success of the Chips and Science Act.

“The administration’s theme that domestic policy is foreign policy is a good way to think about many things.”

WASHINGTON, January 23, 2023 — The TikTok bans that have been implemented by several state governments and universities illustrate a misguided approach to tech policy that targets certain countries at the expense of addressing broadly applicable privacy concerns, said panelists at a Broadband Breakfast Live Online event on Wednesday.

Some of the often-discussed security threats coming from Chinese tech products “are being imagined in a way that is completely detached from reality,” said Yangyang Cheng, a research scholar and fellow at Yale Law School’s Paul Tsai China Center. This misdirected focus diverts attention away from other concrete risks presented by artificial intelligence and social media, she added.

In December, Rep. Mike Gallagher, R-WI, called for a national TikTok ban, calling the app “digital fentanyl” and claiming it was being utilized by the Chinese Communist Party to influence young Americans. Such allegations are unrealistic and xenophobic, Cheng said, but still have the power to broadly shape American society.

For example, several universities have now banned the use of TikTok on the schools’ Wi-Fi and equipment. Access to a particular social media app is not itself a fundamental right, but “fundamental rights with regards to academic freedom, freedom of expression, government’s role in a society are being shaped, and some fundamental freedoms are being infringed on… in the name of banning TikTok,” Cheng said. “That is the concrete harm here.”

The rhetorical focus on a potential TikTok ban and other “combative” issues takes away from more important discussions, such as the fact that the U.S. lacks comprehensive privacy legislation, said Kate Kaye, an independent tech journalist. Unlike the U.S., China has legislation allowing people to opt out of algorithmic social media targeting, she added.

Attempts to establish “very minor ethical guidelines” in U.S. artificial intelligence research have been met with significant pushback from researchers who question whether it is their responsibility to consider ethical questions or data privacy, Kaye said.

Cheng argued that ethical concerns about digital privacy and artificial intelligence are not unfounded, but rather unfairly targeted at certain countries. For example, the U.S. government has placed certain restrictions on Chinese digital surveillance firms, citing potential human rights violations, but similar technologies are being developed and used in the U.S. and Europe.

The “rhetorical China threat umbrella” has even been used to argue against such ethical regulations, with U.S. tech companies claiming that such restrictions will impede their ability to compete with their Chinese counterparts, Cheng said.

Concerns about economic competition are ‘repackaged’ as security risks

Potential risks related to technology can be divided into three categories, which are sometimes improperly conflated, Cheng said. First, technical risks can entail built-in design flaws that make devices or software vulnerable to hacking. While these problems are still complicated, they are relatively straightforward to observe and define.

Another category is regulatory risks, referring to the guidelines and restrictions that are placed on data collection, storage and usage.

Risks in these two categories are “not specific to any individual country or political system,” Cheng said. While the security concerns raised by the U.S. government about Chinese tech companies like Huawei and TikTok are “not necessarily unfounded,” those same risks are present in products from several other countries, she added.

“There is an overemphasis on the policing or surveillance capabilities of the Chinese state, without seeing the reality that data is being commodified and basically packaged as capital, so it can just be bought and sold relatively freely by data brokers and other third parties,” Cheng said.

This potential overemphasis on certain countries’ companies falls into the third risk category, which Cheng termed geopolitical risks. One such geopolitical concern expressed by some U.S. lawmakers is that it is harmful for a Chinese company like TikTok to have such a large market share.

However, this concern is sometimes couched in language about data privacy or security, Cheng said. “What we are seeing is that actual concerns about geopolitics or economic competition are being repackaged and somehow hand-waved to the first two types — technical or regulatory risks.”

Many of the national security conversations taking place in the U.S., on a bipartisan basis, are propelled by “profit-driven motives,” Kaye said.

Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, January 18, 2023, 12 Noon ET – Welcoming the Chinese New Year, Navigating a High Tech Cold War

Tensions between the U.S. and China are continuing to grow, and the battle over information technology and policy often appears to be at the heart of the conflict. Chinese telecommunications equipment giant Huawei has been effectively barred from the U.S. market for over a year, and the Federal Communications Commission recently tightened restrictions with a new rule that will keep Huawei, ZTE and other companies from surveilling American citizens. Meanwhile, ByteDance’s TikTok has been banned from U.S. government devices, and some politicians argue that it also should be banned from the devices of its 100 million U.S. users. How will this power struggle play out over the coming year, and what are the implications of both countries’ decisions?

Panelists:

• Dr. Yangyang Cheng, Research Scholar in Law and Fellow at Yale Law School’s Paul Tsai China Center
• Kate Kaye, Independent Tech Journalist and Writer
• Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Panelist resources:

• Legislators Discuss Banning TikTok Over Growing Security Concerns, Broadband Breakfast, December 30, 2022
• Will nationalism end the golden age of global AI collaboration?, By Kate Kaye, Protocol, November 1, 2022

Dr. Yangyang Cheng is a Research Scholar in Law and Fellow at Yale Law School’s Paul Tsai China Center, where her work focuses on the development of science and technology in China and US‒China relations. Her essays on these and related topics have appeared in The New York Times, The Guardian, The Atlantic, WIRED, MIT Technology Review, and many other publications. Trained as a particle physicist, she worked on the Large Hadron Collider (LHC) for over a decade, most recently at Cornell University and Fermi National Accelerator Laboratory.

Kate Kaye is a tech journalist who tells deeply-reported stories with words and sound. Her work has been published in Protocol, MIT Technology Review, CityLab, OneZero, Fast Company, and many other outlets, and it’s been heard on NPR, American Public Media’s Marketplace and other radio programs and podcasts. Kate covered AI and data as senior reporter for Protocol until the publication suddenly shut down in November 2022.

Drew Clark (moderator) is CEO of Breakfast Media LLC. He has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

Graphic by Adobe Stock

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