As Biden and Xi Meet, Chinese Tech Threats Continue to Grow

President Biden and Chinese President Xi Jinping will meet in San Francisco today. In the lead-up to the meeting, Treasury Secretary Janet Yellen said that the U.S. seeks “a pragmatic economic strategy: one that protects our vital national security interests while seeking a stable and healthy economic relationship.”

It sounds wonderful. But the most pragmatic strategy is one that recognizes the extent to which China is threatening the U.S. through technology. If left unchecked, multiple ongoing Chinese efforts in the tech arena will continue to damage both American national security and prosperity.

Begin with semiconductors. China has responded to the U.S. restrictions imposed on advanced chips (14nm and lower in node size) in October 2022 by subsidizing the production of legacy-node chips—those which are found in everything from vacuum cleaners, to automobiles, to fighter jets. As the world saw during the pandemic, multiple industries can grind to a halt without a secure, stable supply of these chips. And given China’s history of economic coercion, no American should want China to become the world leader in the production of legacy chips. But that’s exactly what’s happening: The semiconductor industry group SEMI estimates that by 2026 China will control 42% of global capacity in foundational – another term for legacy – chips.

China also remains undeterred from positioning itself to launch massive cyberattacks against U.S. critical infrastructure. Wired reported this week that officials at the National Security Agency are deeply alarmed at how Chinese hackers have quietly penetrated American systems, waiting for the right moment to attack—such as during an invasion of Taiwan. “We are going to need internet service providers, cloud providers, endpoint companies, cybersecurity companies, device manufacturers, everybody in this fight together,” said Morgan Adamski, director of the NSA’s Cybersecurity Collaboration Center. Here too semiconductors manufactured by Chinese companies pose a threat. Because there is no such thing as a Chinese company free of government control, chips made in China could become conduits for espionage, cyberattacks, malfunctions, and system shutdowns. The damage caused by Supermicro circuit boards hints at the kind of disaster that could befall American power, water, and telecommunications entities if they allow Chinese-manufactured chips in their systems.

Third, despite major U.S. blows to Huawei’s ability to produce 5G-enabled products, the company continues to prosper. The new Mate 60 Pro phone—featuring a chip made by SMIC using American know-how—threatens to supplant the iPhone in China, dealing an enormous blow to Apple, one of America’s flagship tech companies. Beyond that, the emergence of the new Huawei phone shows that the U.S. must tighten restrictions targeting Huawei and companies manufacturing components for its products. Prior entity listings and export controls specifically targeting China’s advanced chip capabilities are not working. The narrative that China is skirting U.S. curbs simply continues to grow. As Eric Sayers and Mark Montgomery have recently written, Huawei also continues to gobble up market share in the cloud computing space, causing the world’s companies and governments to become more dependent on Chinese technology and digital infrastructure to become increasingly tailored to Beijing’s liking. As the Chinese government has done with semiconductors, solar panels, and electric vehicles, its playbook of doling out massive subsidies to cloud providers is paying dividends—the Middle East and Latin America are hotspots for Chinese cloud business.

Finally, TikTok remains a massive threat to national security and the health of American civil society. There is a reason that Chinese users under 14 years old are only allowed exposure to the platform (known Douyin in China) for 40 minutes a day—its addictive power causes it to live up to its nickname of “digital fentanyl.” “It’s almost like they recognize that technology is influencing kids’ development, and they make their domestic version a spinach version of TikTok, while they ship the opium version to the rest of the world,” former Google employee and Center for Humane Technology founder Tristan Harris told “60 Minutes.” Even Nepal recently banned TikTok for its role in “disrupting social harmony.”

More concretely, TikTok’s vast user base and ties to the Chinese Communist Party make it potentially the most powerful information warfare and data collection tool in history. The CCP can order TikTok’s parent company, ByteDance, to alternatively promote or de-emphasize content at Beijing’s whims. Many national security analysts and lawmakers have speculated that the 946 million views for the #FreePalestine hashtag vs. 117 million #Israel hashtag is no accident, and has helped to inflame division between Americans on their views on the war. Whether Beijing’s propaganda masters are manipulating TikTok has not been conclusively proven. Either way, its power as a tool to influence and collect data on the roughly 100 million Americans who use the app remains clear.

The Biden Administration’s list of worries regarding China are long—from the threat of an invasion of Taiwan, to the shipments of precursor chemicals for fentanyl to the U.S., to the lack of military-to-military communication to avert a crisis. The U.S. is also preoccupied with helping Ukraine and Israel defend themselves against nefarious actors. It is tempting to give Chinese tech issues a backseat. But the Biden Administration must still devote some effort to tackle China’s multi-pronged effort to undermine American security, American prosperity, and American minds.