Why U.S.-China AI Competition Matters

Competing AI development in the United States and China needs to be reframed from the AI arms race rhetoric, but that doesn’t mean AI development itself doesn’t matter. In fact, the opposite is true. We are in an era of great power competition, and U.S. policymakers must pay greater attention to artificial intelligence development domestically and in China, primarily for two reasons. First, artificial intelligence will have a profound impact on state power, mainly through economic growth and enhanced military capability. Second, global leaders in AI will set norms around its use—and around the use of technology in society writ large—which will have important influence on other “undecided” states and the future international order. This is why American policymakers should focus on engaging with China on AI projects without giving up critical expertise or technologies that could potentially enhance harmful applications of artificial intelligence, whether they are in governance, business, or the military.

We are entering an era of great power competition, characterized by “struggle, change, competition, the use of force, and the organization of national resources to enhance state power.” Industrial productivity, science, and technology are critical in this struggle as well, notes international relations scholar Paul Kennedy.¹ Indeed, that seems to be the case. Amidst a heap of articles on the death of the liberal world order,² there is also much concern in the American national security arena around China, Russia, Iran, and North Korea—what political scientist Amy Zegart refers to as the “big four” due to their various elements of state power and the threat vectors they present (nuclear risks, cyber risks, territorial aggression against U.S. allies, and disruption of the international order).³ The great power competition that Paul Kennedy identified from the twentieth century is back in full force.⁴

“Great power competition returned,” declared President Trump’s National Security Strategy in 2017.⁵ While the strategy isn’t without its flaws—one historian notes how “the grim worldview at [the strategy’s] core threatens to undermine the strategies that have long made U.S. global leadership work”⁶—the document isn’t wrong in its premise: We are in an era of great power competition. The U.S. defense establishment similarly recognized this fact in its 2018 National Defense Strategy, asserting that

“The central challenge to U.S. prosperity and security is the reemergence of long-term, strategic competition by what the National Security Strategy classifies as revisionist powers. It is increasingly clear that China and Russia want to shape a world consistent with their authoritarian model—gaining veto authority over other nations’ economic, diplomatic, and security decisions.”

Alongside the ongoing weakening of the post-World War II international order, the strategy notes, “China is leveraging military modernization, influence operations, and predatory economics to coerce neighboring countries to reorder the Indo-Pacific region to their advantage.” Further, “As China continues its economic and military ascendance, asserting power through an all-of-nation long-term strategy, it will continue to pursue a military modernization program that seeks Indo-Pacific regional hegemony in the near-term and displacement of the United States to achieve global preeminence in the future.”⁷ This is undoubtedly great power competition between China and the United States, as then-Secretary of Defense Jim Mattis further emphasized when presenting the strategy document.⁸

In this great power competition, artificial intelligence is of vital importance and will become even more important for state power in the coming decades, particularly as AI accelerates economic growth and enhances military capabilities. As China enhances its state power through both of these dimensions, the United States must pay close attention and work to maximize its own gains in these respects.

Artificial intelligence is poised to contribute greatly to bolstering a developed nation’s economy. Accenture Research and Frontier Economics predict, based on research in 12 developed countries, that AI could “double annual economic growth rates” in 2035 while also increasing labor productivity by up to 40 percent.⁹ McKinsey Global Institute predicts AI may deliver $13 trillion in global economic activity by 2030.¹⁰ PricewaterhouseCoopers puts that figure even higher at up to $15.7 trillion in global GDP growth by 2030, much of which will be due to productivity increases.¹¹

These estimates are varied, but they all rightfully predict enormous economic growth due to an explosion in AI uses worldwide.¹² However, these gains will not be evenly spread. As research from McKinsey Global Institute articulates, “leaders of AI adoption (mostly in developed countries) could increase their lead over developing countries,” and “leading AI countries could capture an additional 20 to 25 percent in net economic benefits, compared with today, while developing countries might capture only about 5 to 15 percent.”¹³ With the United States and China already representing the largest economies in the world, maximizing uses of AI within either nation could lead to massive gains in state power and influence on the global stage. “After all,” writes political scientist Michael Horowitz, “countries cannot maintain military superiority over the medium to long term without an underlying economic basis for that power.”¹⁴ Further, there is in part a question of pure economic power: If Chinese companies don’t just develop better but also use that AI more profitably than American firms, China benefits economically and by extension has more resources to build state power generally. That the United States currently has significant AI talent does not mean an American edge in AI development is decisive and everlasting.

Militarily speaking, artificial intelligence is also revolutionary for state military power. The People’s Liberation Army (PLA) in China views AI as a revolutionary factor in military power and civil-military fusion,¹⁵ just as the U.S. Department of Defense has similarly recognized how advances in artificial intelligence “will change society and, ultimately, the character of war.”¹⁶ China is investing in this future. The PLA has already funded a number of AI military projects as part of its 13th Five-Year Plan, spanning command decision-making, equipment systems, robotics, autonomous operating guidance and control systems, advanced computing, and intelligent unmanned weapon systems.¹⁷ In 2017, President Xi Jinping called for the military to accelerate AI research in preparation for the future of war.¹⁸ There has even been a report of the Beijing Institute of Technology recruiting high-talent teenagers for a new AI weapons development program.¹⁹ The Chinese government is undoubtedly preparing to maximize its AI development in the service of maximizing its military power.

That the United States currently has significant AI talent does not mean an American edge in AI development is decisive and everlasting.

The United States has started to do the same, in some respects: It has established a Defense Innovation Board for ethics of AI in war,²⁰ as well as a Joint Artificial Intelligence Center to develop “standards….tools, shared data, reusable technology, processes, and expertise” in coordination with industry, academia, and American allies.²¹ DARPA, the Defense Advanced Research Projects Agency, currently has 25 programs in place focused on artificial intelligence research, and in September 2018, its director announced a plan to spend up to $2 billion over the next five years on more AI work.²² But there is still much to be done, as I’ll address in the last section.

Even within the U.S. military’s approaches to artificial intelligence, as one West Point scholar notes, “the military is facing some hard questions about how it will adapt its culture and institutions to exploit new technologies—and civilians face a tough job ensuring they answer them effectively.”²³ There are certainly military leaders aware of this fact—in announcing the $2 billion in AI funding, DARPA’s director depicted it “as a new effort to make such systems more trusted and accepted by military commanders”²⁴—yet the road ahead will have its challenges. In general, the U.S. defense apparatus’ willingness to engage in cultural and operational shifts will greatly influence how successfully AI is integrated into the United States military.

It’s also important to note that China’s government and its private companies will likely be less constrained by ethical and legal norms when developing AI than will their American counterparts.²⁵ Faster deployment of and greater experimentation with AI may result, even though this may lead to perhaps chaotic or more unpredictable deployments of artificial intelligence—or, perhaps, plainly unethical uses of AI. This leads into the second main reason why U.S.-China AI competition still matters.

Artificial intelligence is increasingly enabling authoritarian governance around the world. Many commentators have referred to this as “digital authoritarianism,”²⁶ by which technologies like AI—deployed at scale to, say, bolster citywide facial recognition—enable or enhance authoritarian principles of state governance. Chinese companies have been complicit—and at times instrumental—in the diffusion of the technology and practices that enable this authoritarian governance. While Western companies sometimes export surveillance technology to dictators as well, most democratic governments take steps to prevent it through export controls, such as those established in the Wassenaar Arrangement.²⁷

Artificial intelligence is increasingly enabling authoritarian governance around the world.

Chinese firms have exported facial recognition systems to governments in Singapore, the United Arab Emirates, Zimbabwe, and Malaysia. Broader categories of surveillance technology—from national identity cards to biometric sensors, internet monitoring software, and more—are also exported by Chinese companies to governments in Ethiopia, Ecuador, South Africa, Bolivia, Egypt, Rwanda, and Saudi Arabia.²⁸ In addition to enabling insidious social control and large-scale human rights abuses, such spread of surveillance technology—which includes AI—consolidates power in the hands of governments that are hostile, or typically align with powers hostile, to American interests.²⁹ Democracy is under attack around the world,³⁰ and authoritarian uses of AI further harm democratic norms and the state of democracy globally. This is especially true for the many countries who remain undecided in their use and regulation of technologies like artificial intelligence.

This is an obvious strategic problem for U.S. policymakers, especially as Beijing has already sought to become a global leader in technology norms through an assortment of proposals at the likes of the United Nations³¹ and through channels such as IEEE.³² Unsurprisingly, this interest has already been reflected with respect to artificial intelligence. The China Electronics Standardization Institute, involved in standard-setting under China’s Ministry of Industry and Information Technology, released a white paper in January 2018 on a framework for AI standardization.³³ In April 2018, Chinese organizations hosted a major international AI standards meeting in Beijing.³⁴ Similar to how China is proactive in trying to set global norms around the internet, it is also intent on setting global standards and norms around artificial intelligence and its use in society.³⁵

As Jeffrey Ding, Paul Triolo, and Samm Sacks explain, “realizing that China’s many large companies are increasingly global players, and Chinese-developed AI algorithms will have effects on users outside of China, China’s government aims to advance global efforts to set standards around ethical and social issues related to AI algorithm deployment. Should Chinese officials and experts succeed in influencing such standards and related AI governance discussions, the policy landscape may skew toward the interests of government-driven technical organizations, attenuating the voices of independent civil society actors that inform the debate in North America and Europe.”³⁶ This may very well become a greater trend—as China’s government and private industry develop increasingly sophisticated AI applications—that lends even further global influence to China alongside bigger economic advantage.

It’s not just through diplomats, trade negotiators, and military officers that the Chinese or American government will exercise influence in areas of competition between the two countries (most obviously Southeast Asia, Africa, and Latin America). Without a clear, viable model of digital governance to oppose digital authoritarianism, the United States stands to lose political influence over a number of countries in these areas. This, too, will significantly impact great power competition, potentially in ways that diminish the relative importance of military power.

The Chinese government, in this larger process of global norm-setting on uses of contemporary technologies, is attempting to remake the world in its image. This is why U.S. policymakers desperately need to reframe their thinking on AI competition.