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US must face artificial intelligence competition from China, national security commission report says


Key Points:
• Artificial intelligence (AI) has become one of the most crucial areas of strategic competition
• ‘United States can compete against China without ending collaborative AI research and severing all technology commerce,’ says national security commission on AI

Reporting by: Jodi Xu Klein, SCMP in New York

A US national security commission urged Washington to compete head-on against China on artificial intelligence (AI), but not to completely decouple from the rival in research and business.

The National Security Commission on Artificial Intelligence (NSCAI) said in its final report to Congress on Wednesday that “the United States can compete against China without ending collaborative AI research and severing all technology commerce”.

“The US-China competition is complicated by the complex web of supply chains, research partnerships, and business relationships that link the world’s two AI leaders,” according to the commission, chaired by former Google CEO Eric Schmidt.

“Dramatic steps to sever these ties could be costly for Americans and reverberate across the world.”

The recommendations come at a time when the United States rethinks its strategy to remain the global leader in science and technology development as China makes strides in key areas including robotics and AI.

Artificial intelligence has quickly become one of the most crucial areas of strategic competition. Many believe the technology will decide the future of many other industries including infrastructure, commerce, transport, health, education, financial markets and food production.

Within artificial intelligence, China has particularly made progress in natural language processing and facial recognition as its social media, e-commerce, and 5G technology companies have emerged as global leaders.

China introduced its “Next Generation Artificial Intelligence Development Plan” in 2017 to make China an AI superpower by 2030, surpassing its rivals to become “the world’s premier artificial intelligence innovation center”. The Chinese government has backed up its AI plans with significant state subsidies.

To meet that challenge, the commission said, the US must make public policy choices to preserve American advantages.

Schmidt proposed a technology competitiveness council to be set up within the White House and called for robust government funding for research.

“We do need more money, particularly in AI R&D so that by 2026, we get to US$32 billion per year,” said Schmidt.

The National Security Commission on Artificial Intelligence was established a few years ago as part of the National Defense Authorization Act as an independent entity, with back-end help from the Defense Department, to assess means to propel US tech competitiveness.

While the report said it is “not calling for a state-directed economy, a five-year plan, or China-style ‘military-civil fusion’”, it is urging a more prominent government-led process.

“The government has a long-history of mobilizing industry and academia and making huge investments when it is challenged. Against the backdrop of a declared and committed competitor like China, and given AI’s transformative potential, the United States is confronting such a moment,” said the report.

Ways to confront the competition would include finding ways to attract AI talent, expanding research by allowing more access to data, and staying in front of semiconductor design.

“It’s really important that our hardware stay ahead, be cutting edge, and we are very close to losing the cutting edge of micro electronics [which] power our companies and our military because of our reliance on Taiwan,” said Schmidt on Wednesday, referring to the danger of falling behind if China surpasses Taiwan, US’ main source for chips.

“We need to revitalize domestic semiconductor manufacturing and ensure that we’re two generations ahead of China.”

Last week, US President Joe Biden signed an executive order directing a 100-day review of American supply chains for critical products including semiconductors, aiming to reduce reliance on countries such as China.

Also last week, Senate Democratic leader Chuck Schumer said he directed committees to craft a bipartisan bill based on legislation he proposed last year in May seeking funding of US$100 billion to spur research in key tech areas, from artificial intelligence to quantum computing and semiconductors.

Senators are also looking at providing funding to semiconductor programmes included in last year’s National Defense Authorization Act.

On the other hand, the commission warned against a broad-based technological decoupling from China.

Such decoupling, it said, could deprive US universities and companies of scarce AI and science, technology, engineering, and mathematics talent. It could also sever US companies efficient supply chains and cut off access to markets and capital for innovation.

“The relationships between American and Chinese academics, innovators, and markets are deep, often mutually beneficial, and help advance the field of AI,” the report said. “Instead, the United States should conceive of targeted disentanglement as just one element of its overall approach.”

It stressed that disengagement should be “applied judiciously” to reduce threats from illicit tech transfer and protect sectors critical to national security.

Editors Note:
This is a report from Jodi Xu Klein of the South China Morning Post (SCMP) in New York, and we republish it here by kind permission of the SCMP. To see more great business articles from the SCMP, visit them on the web at:




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