Fight Beijing’s Surveillance State
Donald Trump wants to use the Chinese telecom firm ZTE, which faces corporate death after violating U.S. sanctions, as a bargaining chip in negotiations with China over trade or North Korea. The president should also remember that China seeks to replace the U.S. as the world’s pre-eminent power, and surpassing the U.S. in digital technology has become a key component of its strategy.
Beijing continues to invest heavily in research and development, subsidizing its high-tech industries. As in the past, it is also acquiring technology by forcing American companies to transfer intellectual property in exchange for access to the Chinese market. Sometimes the country is more brazen and simply acquires secrets through espionage and cybertheft. China used many of these means to acquire U.S. solar technology, becoming a world leader in renewable energy. Beijing regularly violates World Trade Organization rules with little consequence.
In July 2017 the Chinese government announced that it intends to become the world leader in artificial intelligence by 2025. Protectionism already has enabled the growth of massive digital platforms such as Baidu, Alibaba and Tencent—originally Chinese copies of Google, Amazon and Facebook . Certainly Beijing hopes its digital and artificial-intelligence efforts will sustain the country’s robust economic growth, but geopolitical concerns also drive its aggressive ventures. Digital technology, advanced data analytics and artificial intelligence together form a critical new frontier of geopolitical competition.
Beijing is also investing heavily in technology to improve its repressive surveillance state. The rapid digitization of the Chinese people’s financial and social interactions is producing unprecedented amounts of personal data. This information remains subject to analysis and scrutiny by the Communist Party, which aims for an unprecedented level of control over Chinese citizens.
The government hopes to perfect digital imaging and facial recognition. Once it has centralized every citizen’s data, it can use artificial intelligence to assess the information and issue a “social credit” score to all individuals. This trustworthiness measure can then be used to determine whether someone can, for example, borrow money or buy a train ticket. In some regions, Beijing has mandated the installation of a special application on mobile phones to scan devices and report material deemed dangerous.
Ominously, China is exporting this model by providing hardware and software to other countries. Features of the surveillance state hold great appeal for existing or nascent authoritarian regimes wishing to control their subjects more thoroughly. Democrats in Southeast Asian countries such as Cambodia are already fearful that local autocrats are building their own surveillance states.
It is also possible that China will seek to project its surveillance state into open societies. In fact, it likely has done so already. Its hacking of the U.S. Office of Personnel Management a few years ago, through which it acquired the security-clearance materials of more than 20 million U.S. government employees and contractors, shows such intent. China may be in the process of profiling Americans more widely. This presents a clear threat to U.S. interests and values.
The U.S. has several options to show it won’t abide such a strategy. It can impose targeted tariffs on products from firms that benefit from forced technology transfer. The Commerce Department can also close the joint-venture loophole, even if it isn’t popular with American companies that might suffer financial costs. The Committee on Foreign Investment in the U.S. can more aggressively prevent joint ventures on national-security grounds. American companies and academic institutions conducting research that helps China perfect its surveillance state should also face consequences.
To protect its technology, the U.S. should impose restrictions on Chinese investment in American artificial-intelligence and digital-technology companies. The federal government also can assist companies in protecting their secrets against Chinese efforts to steal them through espionage or cyberattacks by imposing real costs on Beijing for such behavior. The U.S. will need to create the capacity to source technology for national-security systems solely from domestic companies by enacting security-related regulations. Otherwise China or other adversaries could build back doors for subsequent access.
To compete with China politically and to stand up for democratic values, American officials should speak out regularly against the rise of the Chinese surveillance state. The U.S. should also focus its democracy-promotion programs on undermining the development and export of China’s surveillance state.
A U.S.-led alliance of like-minded countries—including some nontraditional allies—could help spread digital infrastructure that promotes institution building and good governance. This alliance would aim to build “opportunity states” as an alternative to the surveillance state. In India, an effort to reduce corruption in the welfare system by enrolling every citizen in a digital identification scheme has snowballed into a digital infrastructure that greatly reduces the cost of financial transactions. These systems, known collectively as the India Stack, are reshaping public service delivery and spurring inclusive commercial innovation. This model could help developing countries jump-start economic development and expand broadly shared growth.
The landscape of geopolitical competition has gone digital, and the U.S. currently is not headed for success. But America maintains unique leverage, as the sanctions imposed on ZTE demonstrate. As the Trump administration negotiates with China, it must remember the broader rivalry. Reducing the trade deficit is important, but preventing China from achieving digital dominance is vital.
Mr. Khalilzad was U.S. ambassador to the United Nations (2007-09) and head of policy planning in the Defense Department (1990-92).
Appeared in the May 18, 2018, print edition.