Tag Archives: technology

The AI Race:  China vs US

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A few weeks ago, the White House released a long awaited report entitled “Winning the Race: America’s AI Action Plan.”  The represents “a decisive pivot toward deregulation as the key driver for rapid innovation in pursuit of global AI leadership.” 

The reaction on both sides of the aisle has been quite positive and reflects a consensus among “technology executives, national security analysts, and U.S. officials” about the importance of AI.  Which is particularly surprising in 2025, at a time when Republicans and Democrats can’t seem to agree on whether the sky is blue.     

Even the Washington Post published an editorial endorsing the plan.  “The most important question for the United States regarding artificial intelligence right now is not how it will be used, or even how it will affect the economy and culture. It is whether the U.S. will maintain AI dominance. The race to own the technology of the future is a race we must not lose.”  Which is especially interesting given the Post’s anti-Trump bent and the fact that that this plan “noticeably steps back from the Biden administration’s attempts to identify and mitigate potential risks and pitfalls of [AI].”

The fundamental reason why AI is such a hot topic right now is that, as an opinion piece in Forbes put it, “AI has the potential to change the world as dramatically as the groundbreaking technologies that sparked previous industrial revolutions.”  Wait a minute.  As dramatically as the industrial revolution?  Isn’t all “this talk of the fourth industrial revolution just hot air from marketers talking up the share price of hugely powerful global corporations” the Forbes writer went on to ask.  Some of it is, he concluded, but the breakthroughs are real and are coming at a faster and faster pace.  Google CEO Sundar Pichai has repeatedly said that the impact of AI on humanity “will be even more transformational than fire.”

Many people first became aware of AI’s power with the release of ChatGPT in November 2022, a “large language model chatbot” that can carry on a conversation, write a thank you note to your grandmother, instantly research and compose a 20 page paper on King Ethelred the Unready, create a short story about how a frog developed its love of eating mosquitos, write computer code, and much more. 

If you haven’t already experimented with ChatGPT or one of its many competitors, you should give it a try, right now.  Put aside this blog for a few minutes, download the free version and prepare to be at first amazed and then a little scared at what the program can do.  And each new version keeps getting better.  (ChatGPT5 was released last Thursday, August 7.)

When I first wrote about ChatGPT and the risks of AI in this blog in July 2023, I asked the question “Should you worry about AI?” and answered myself “Unless your job is threatened, my answer is not at all.”  That was then, this is now.  You should worry.  In the last two years AI has become so much cheaper and more powerful that even the Pope is worried. 

And China is already having a major impact on how AI develops and how it is used.  The country’s “Next Generation Artificial Intelligence Development Plan” was announced in 2017 with the same goal as Trump’s plan: to dominate worldwide AI.  One way they are trying to do that is by competing on price, as the Chinese company DeepSeek did in January when it announced a new product that was so cheap it rattled the stock market.  In fact, the Deep Seek announcement “triggered a $1 trillion sell-off in U.S. and European technology stocks in a single day… [because its cost and popularity] have raised concerns about the future market share of established tech giants, leading to substantial declines in their stock valuations.” 

Since then, “Chinese companies have flooded the market with 1,509 large language models… often using open-source strategies to undercut Western competitors.”  The most dramatic so far was two weeks ago (July 28), the release of GLM-4.5, by the Chinese startup Z.ai.  It makes “DeepSeek look expensive [with]… an 87% discount on … long conversations with AI.” 

One of the most frightening things about all these new Chinese products is that since 2022, the US has been trying to slow Chinese progress by restricting the sale of advanced AI chips to China.  But the onslaught of new products shows that “export controls clearly aren’t slowing Chinese AI development. A blacklisted company [Z.ai] just delivered competitive performance while operating under restrictions designed to cripple such capabilities.”

Does this mean China is winning the AI race?  Foreign Affairs recently published several articles addressing this question in a far more nuanced way than the title of this post or any newspaper headline.  In “The Real AI Race” Rand experts Colin H. Kahl and Jim Mitre take the discussion back to basics by reminding readers that “determining who is ahead depends on what it means to win.”  They note that these days most experts define the race based on when AGI (artificial general intelligence) programs prove to be at least as smart as human experts. 

Unfortunately, however, “there is no standard, shared definition of AGI or consensus on whether, when, or how [AGI] might emerge.”  Nevertheless, most experts have long been bullish on how quickly it will appear.  When I first wrote about AI in this blog in 2022, I quoted AI pioneer Herbert A. Simon’s 1965 prediction that that “machines will be capable… of doing any work a man can do… within twenty years.”  He was wrong.

In 2023, when the consulting firm AIMultiple reviewed 15 surveys completed by a total of 8,590 AI experts about when they think AGI will actually exist, the most frequent answer was remarkably similar to Simon’s –  about 20 years.   More specifically, they found that 50% of AI experts predicted “that AGI will probably… emerge between 2040 and 2050 and is very likely (90% chance) to appear by 2075.”  That leaves 10% who think AGI emergence will take more than 50 years, if it ever occurs at all. 

You can put me in with the skeptical 10%.  Perhaps I was scarred by my own brief experience in AI in the early 80s, when I worked for a consulting firm on an ill-advised AI project for the US Army.  Or my skepticism could be grounded in my firm belief that we simply don’t know enough about the human brain to expect to improve on it.  When I earned a Ph.D. in Psychology, I spent countless hours reading about the major breakthroughs in neuroscience that were just around the corner.  Today, 50 years later, as far as I can tell they are still around the corner.  Some have described the brain as the most complex structure in the universe, with over 80 billion neurons, many connected to thousands of others at 100 trillion synapses.  It’s a miracle we can walk and chew gum at the same time.

Not only is the race to AGI uncertain to ever end, but it oversimplifies the problem.  As Kahl and Mitre concluded “The notion of a singular AI race between the United States and China fails to capture the true complexity of the rivalry unfolding today. The challenge is to win not one definitive contest but a multifront competition whose outcome will shape the international balance of power.”  Their article reviews multiple AI races, some of which may be won by the US and others by China. “Militaries and intelligence agencies must harness AI’s transformative potential and mitigate its disruptive effects. Similarly, countries stand to gain a competitive edge if they can adopt AI at scale across the economy and society. Governments are also battling to create and own the standards, supply chains, and infrastructure that will undergird the global technological ecosystem.”

Trump’s plan for American AI dominance is based on the US tech industry’s approach of developing proprietary AI models.  This is certainly the road to being able to charge the highest prices.  For example, Apple’s proprietary approach to iPhones and other products has enabled them to charge premium prices and become extraordinarily profitable.  But there also huge risks to the proprietary approach.  If you are old enough to remember the 1970s fight over standards in videotapes, you may have owned a Betamax recorder, which was Sony’s attempt to establish standards for this fledgling marketplace.  While it was widely regarded as technically superior to the competing VHS videotape format, Betamax lost out for several reasons including its higher cost. 

Given multiple AI races, does it make sense to try to choose a single winner?  Brad Smith, the president of Microsoft, thinks so: “The number one factor that will define whether the United States or China wins this race is whose technology is most broadly adopted in the rest of the world.”  Eric Schmidt, former CEO of Google, agrees and goes on to argue that “Chinese AI firms have expanded their influence by freely distributing their models for the public to use, download and modify, which makes them more accessible to researchers and developers around the world.”  And, Schmidt says, China “has developed a real edge in how it disseminates, commercializes and manufactures tech. History has shown us that those who adopt and diffuse a technology the fastest win.”

Trying to win the AI race by addicting the world to proprietary standards defined by US firms, the way Trump’s plan does, may be aiming in the wrong direction.  According to still another Foreign Affairs article published recently, “America should aim for victory but prepare to finish second… Washington cannot and should not expect its lead to last forever… Washington needs to plan for a possible future in which the United States loses the AI competition to China—or, at the very least, one in which Chinese AI models are as popular globally… Finishing second is not a death knell for American AI, but refusing to adapt to compete would be.”

The Robotics Race:  China vs US

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According to the 2024 World Robotics report, over 4 million robots are currently operating in factories and warehouses around the world to increase the efficiency of tasks ranging from assembling cars to building more robots. 

Predictions for the future vary.  The OECD – an international organization with 38 member countries – “expects global growth [of the robotics market] to stabilize” at about 5% per year.  However, others foresee a dramatically higher growth curve.  Elon Musk has predicted that by 2040 there will be at least 10 billion humanoid robots on the planet. He also has claimed that the Optimus robot that Tesla is currently developing “will be the biggest product of all time by far… Nothing will even be close.”

The first time I read this quote, I saw Musk’s comments as a PT Barnum-type effort to increase the price of Tesla stock, so that the richest man on the planet could become even richer. (Wouldn’t you think $389 billion would be enough?)

But the more I learned about the ongoing robotics revolution, the more I came to believe that it is actually possible that humanoid robots COULD soon change the balance of industrial and military power.  But I wouldn’t bet on Musk or Optimus, because China is developing robots far more quickly and cheaply than the US.  

The exact line between industrial robots and other machines can be hard to define, but generally robots are more intelligent and autonomous than other machines and“often handle dirty, repetitive, or dangerous tasks to improve human safety and productivity.”  The line will be easier to see as the number grows of humanoid robots designed to resemble humans and interact with them.    

While the US is widely perceived as the world leader in robotics innovation, China has dramatic advantages in manufacturing and production.  And, according to the Special Competitive Studies Project, history has repeatedly shown that “even when original breakthroughs take place domestically, production determines market leadership.”

According to a recent think tank report with the ominous title America is missing the new labor economy – Robotics “China’s industrial economy is one of the most formidable players in the world, setting it up perfectly to reap the next evolutions of robotics and automation.” If a video is worth a thousand words, this will give you some sense of China’s current capabilities:   

This demonstration of 16 Unitree G1 robots performing a traditional Chinese folk dance alongside human dancers was televised during China’s 2025 Spring Festival Gala and viewed by over a billion people.

The robot shown in the video can perform a wide variety of functions, while walking at nearly five miles per hour and carrying seven pounds.  It was one of more than 25 humanoid robots that provided live demonstrations at Beijing’s 2024 World Robot conference.  At the same conference “the Tesla Optimus [which is scheduled to be released soon] remained motionless in a clear box.”

A humanoid robot has thousands of parts, with brains constructed from semiconductors, vision software and generative AI models, and bodies which include actuators, motors, drives to generate motion and much more.  Most of these parts are currently made in China, not in the US.  Indeed, “about 56% of the world’s humanoid supply chain companies are based in China.” 

According to the SemiAnalysis report “In the world of Robotics, manufacturing dominance is key. To build a complete and functional robot means recreating the robot countless times and fine-tuning each minor mistake until [it becomes] a solid, scalable, and cost-effective product… With a share of GDP three times higher than that of the US, China’s industrial base outcompetes that of America’s in every possible way.”  One result: “the only viable humanoid robot on the market, the Unitree G1, is now entirely decoupled from American components.”  In contrast, the report continues, “In the US, the ‘Made in America’ label is misleading at best, and downright harmful at worst. [It] allows for significant processing of foreign materials [which]… means a product can be labeled ‘Made in USA’ even if its core components originated in China, obfuscating the true extent of foreign dependence.”

Put these factors together, and China’s supply chain gives it enormous advantages in speed and cost. An article that came out a few weeks ago entitled “America is losing the robot wars“ noted that the Unitree G1 is available now for purchase starting at $16,000.  The Optimus is scheduled to go on sale next year, at an estimated cost of $20,000 to $30,000.  US general purpose robots may be the most technically advanced, but “one estimate suggests that [while] China’s general-purpose robots are roughly 80% as capable as industry leaders, [they] are also 30% cheaper.”

One reason behind this development is government support.  China’s “latest Five-Year Plan explicitly prioritizes humanoid development and automated manufacturing, backed by massive state investment and coordinated industrial policy. This isn’t just about economic efficiency – it’s a calculated bid to secure technological independence.”  While “exact numbers are hard to pinpoint… it is clear that the broad industrial landscape is benefiting from at least tens of billions of dollars every year.”  This support is proving critical not just for current costs, but also for future technological developments.  According to a Morgan Stanley report, in the past five years “China has secured 22% more [humanoid] robotics patents than the world’s 19 next most productive countries combined.”

Put all this together, and it is clear that the US has fallen behind China in the robotics race.  How much does that matter?  Much more than I thought before I started researching this post.  If the SemiAnalysis report is correct, it represents “an existential threat to the US” in both industrial and military terms.

An Edge of Automation white paper put it this way:  “The prospect of robots substituting [for] human labor transcends mere technological advancement – it threatens to shatter one of civilization’s oldest constraints: the scarcity of physical labor….”  For China this could address one of its greatest economic challenges:  an aging and shrinking workforce, caused largely by the country’s ill-advised “One Child Policy.”

That future is almost here.  For example, Chinese companies are experimenting with dark factories – fully automated facilities operated by robots without human workers or traditional lighting.  One dark factory operated by Xiaomi already “operates round-the-clock producing one smartphone per second – with zero humans employed.”

An even more pressing challenge for both countries is the potential for robotics to shift the balance of military power.  According to Edge of Automation “The Russia-Ukraine War has definitively proven that autonomous systems, particularly drones, represent a fundamental shift in military doctrine. Small, inexpensive drones have repeatedly outperformed traditional platforms costing hundreds of times more… [meanwhile] China’s aggressive adoption of military robotics… [such as the use of] Lynx [robot dogs] for ground operations… has accelerated this trend, creating a powerful feedback loop between defense needs and industrial capability…The result is an unprecedented acceleration of robotics technology, driven not by market forces but by the existential imperative of maintaining technological supremacy.”

The military applications of DEEP Robotics Lynx include reconnaissance, surveillance, logistical support, and search and rescue operations.   Some of its capabilities appear in this video:  

In the US, “The National Security Commission on Artificial Intelligence has explicitly warned that falling behind in robotics threatens America’s strategic position.”  This in turn has “unleashed unprecedented resources, from direct funding of research to export controls targeting critical components.”

But it is almost too late.  Think tank researcher William Matthews says that “China has positioned itself quite effectively… to dominate the robotics sector and the robotics supply chain… what you’re looking at potentially is an Industrial Revolution-like shift in the balance of power.” 

As one recent review summed it up “For now, the war over robots is China’s to lose.”

Chinese espionage

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The Chinese are spying on us.  Which seems only fair, since we are spying on them too.

You probably remember last year’s journalism hysteria when a Chinese surveillance balloon floated over the US, and the Air Force shot it down off the cost of South Carolina.  In the big picture, that was a mere kerfuffle, a foofaraw. 

But don’t be fooled.  Chinese espionage offers plenty to be worried about.  In a 2020 speech, FBI Director Chris Wray called “the counterintelligence and economic espionage threat from China… the greatest long-term threat to our nation’s information and intellectual property, and to our economic vitality.”

Since 2020, it’s only gotten worse.  Last October, the heads of intelligence from the US, Canada, UK, Australia and New Zealand – the Five Eyes Alliance – held “an unprecedented joint news conference to warn of… a ‘breathtaking’ Chinese effort to steal technology and economic intelligence and to influence foreign politics in Beijing’s favor.”  According to the FBI’s Wray,  the purpose of this first press conference in the organization’s 80 year history was to warn that the threat from “China’s espionage…  has only gotten more dangerous and more insidious in recent years… The FBI currently has over 2,000 investigations in progress that are linked to China.”

At the same conference, Ken McCallum, the Director General of Britain’s MI5 spy agency reported several examples of his own, including the fact that “suspected Chinese agents have approached over 20,000 people in the UK over professional networking sites like LinkedIn, in order to try to cultivate them to provide sensitive information.”

There are two main reasons why it is very difficult for the West to keep up:  China devotes more resources to espionage, and they are playing by different rules than we are.

Regarding resources, Wray testified before a US House committee on January 31 that, “If you took every single one of the FBI’s cyber agents [and] intelligence analysts and focused them exclusively on the China threat, China’s hackers would still outnumber FBI cyber personnel by at least 50 to 1.”

Chinese hackers work not just as government employees, but also for private Chinese companies that specialize in spying.  A few weeks ago, leaked documents from the Chinese security firm I-Soon recently revealed a price list of what they charged.  If you want to hack Twittter/X accounts and run a disinformation campaign, for $100,000 I-Soon will sell you specialized software to make your targeting and lying more efficient.  Do you want a huge database of personal information entered by unwitting users of Facebook and Telegram?  For $278,000 that too can be yours.

In addition to devoting greater resources to espionage, China’s authoritarian government is also playing by different rules.  Harvard’s Calder Walton summarized key differences in a recent article in Foreign Policy magazine:  “Unlike those in Western democracies, China’s intelligence services are not held to account by independent political bodies or the public, nor are they subject to the rule of law… Thanks to successive national security legislation passed under President Xi Jinping, Chinese businesses are required to work with its intelligence services whenever requested to do so… [In addition] facial recognition, phone apps, and CCTV all make China an infinitely harder target for Western agencies to collect intelligence on than Chinese services’ targets in open Western democracies.”

And if that’s not enough, according to David Vigneault, the director of the Canadian Security Intelligence Service, Chinese laws require its citizens “anywhere in the world to provide information to Beijing’s intelligence services.”

Just a few weeks ago, the FBI’s Wray updated Congress on one major cyber operation which he described as part of “the defining threat of our generation.”  In the Volt Typhoon project “Chinese hackers [have targeted] critical infrastructure in the U.S., such as water treatment plants, electrical grids, oil and natural gas pipelines and transportation systems.” 

The result of operations like Volt Typhoon, according to Congressional testimony by Jen Easterly, Director of the US Cybersecurity and Infrastructure Security Agency, is that “A major crisis halfway across the planet could well endanger the lives of Americans here at home through the disruption of our pipelines, the severing of our telecommunications, the pollution of our water facilities, the crippling of our transportation modes all to ensure that they can incite societal panic and chaos and to deter our ability to marshal military might and civilian will.”

Your home network could be unwittingly aiding a massive Chinese espionage operation, if your router has been infected by KV Botnet malware.   

The primary methods behind this particular operation relied on human flaws “by exploiting vulnerabilities in small and end-of-life routers, firewalls and virtual private networks, often using administrator credentials and stolen passwords, or taking advantage of outmoded tech that hasn’t had regular security updates – key weaknesses identified in US digital infrastructure.”

If you have an old Cisco or Netgear router running your home or small business network, it may have been infected by “KV Botnet malware” planted by the Chinese. If so, your router was “chained together [with other infected routers] to form a covert data transfer network supporting various Chinese state-sponsored actors including Volt Typhoon.”  

Yikes.  Your innocuous little home network could be helping the Chinese to hide the origin of an infrastructure attack someday, since “the botnet’s distributed nature makes the activity hard to trace.”  This is a prime example of the way “state-sponsored cyber actors are seeking to pre-position themselves on IT networks for disruptive… cyberattacks against US critical infrastructure in the event of a major crisis.”

In December, the FBI fought back with a court-ordered action to “delete the KV Botnet malware from the routers.”  But if you restarted your router after the cleanup, your server will once again be vulnerable.  This is one of several reasons that experts say “the legal action is bound to be a only temporary disruption.”

To put it another way, the potential effects of Chinese espionage continue to rise.

In an article entitled “Spycraft and Statecraft,” William J. Burns, the director of the Central Intelligence Agency wrote in the current issue of Foreign Affairs that “This is a time of historic challenges for the CIA and the entire intelligence profession, with geopolitical and technological shifts posing as big a test as we’ve ever faced. Success will depend on…  adapting to a world where the only safe prediction about change is that it will accelerate.”

To address the China challenge, Burns reported that the CIA has more than doubled “the percentage of our overall budget focused on China over just the last two years. We’re hiring and training more Mandarin speakers while stepping up efforts across the world to compete with China, from Latin America to Africa to the Indo-Pacific.”  The New York Times reported that, “The C.I.A. and the Pentagon’s Defense Intelligence Agency have [also] set up new centers focused on spying on China. U.S. officials have honed their capabilities to intercept electronic communications, including using spy planes off China’s coast.”

Meanwhile, the American and Chinese economies continue to get more intertwined.  At the height of the Covid epidemic, many Americans learned for the first time that the US depends on China for things like surgical masks, personal protective equipment, respirators and many other medical products needed to fight the disease.  In the early stages of the pandemic, when world supplies were short, China wouldn’t share them.

The top ten products the US imports from China today include lithium batteries, display monitors, smartphones, digital automation systems, pre-dosed medications and data processors.  Good luck to all of us if access to these and other Chinese products was cut off during a crisis.

So, at the same time that we continue to compete with China politically and economically, we must simultaneously cooperate and work together to tackle existential challenges to the human race including climate change and avoiding nuclear war.

Last year, Pulitzer Prize winning reporter Thomas L. Friedman visited China for the first time since covid to try to get a grip on what all this means.  Hu Xijin, one of China’s most popular bloggers, said to him: “You have been in the first place for a century, and now China is rising, and we have the potential to become the first — and that is not easy for you… [But] you should not try to stop China’s development. You can’t contain China in the end. We are quite smart. And very diligent. We work very hard. And we have 1.4 billion people.”

Based on this and many other interviews, Friedman concluded: “I believe that [China and the US] are doomed to compete with each other, doomed to cooperate with each other and doomed to find some way to balance the two. Otherwise we are both going to have a very bad 21st century.”