U.S. Trade Representative Robert Lighthizer today revealed the fundamental misjudgment at the heart of the Trump Administration’s strategy for dealing with China. In an exchange with Sen. Ron Wyden of Oregon, Lighthizer correctly noted that China is stealing technology from the United States and that will deprive our children and their grandchildren of the jobs associated with those technologies–and therefore if you want to prevent that, you have to be ready to use massive tariffs.
Only problem is, tariffs have nothing to do with China’s theft of U.S. technology or its state-mandated program to rapidly develop key technologies to leapfrog American companies’ products. The thinking in the administration seems to be that if they bludgeon the Chinese about the ears and cause chaos in the economic relationship between the world’s two largest economies that the Chinese leadership will give up its technological ambitions.
But that is a fundamental misread of Chinese government thinking. It sees the development of technologies as absolutely essential to establishing China as a world power that can compete with the United States and eventually replace it as the dominant power globally. The disruption in the relationship that Trump appears to be trying to create could actually accelerate China’s efforts to secure American technologies while our guard is still down. The massive pattern of Chinese government hacking against American companies and governmental institutions is continuing unabated inside the United States.
There can be no negotiations or threats that will alter the Chinese strategy. It’s insulting to the Chinese, in their view, that the Americans are, in effect, asking them to take steps that will hold them back on the world stage. It is reminiscent to them of how foreign powers humiliated China during its “century of humiliation” from roughly 1840 to 1949 when Mao Tse-Tung took power.
As I advocate in my book, “The New Art of War: China’s Deep Strategy Inside the United States,” our only choices are to get serious about hardening all our IT systems, adopt much tougher internal threat procedures to flush out economic spies, rev up our technology policies and strategies to remain competitive, streamline our training and retraining efforts to create the skills that will attract American companies back home, and win the soft war that China is waging inside the United States. We have to control the things we can control, not make demands that go unheeded.
