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William Barr thinks China is stealing American technology. Can the U.S. halt the exchange of knowledge?

February 15, 2020

William Barr thinks China is stealing American technology. Can the U.S. halt the exchange of knowledge?

February 15, 2020
Peter A. Hall in Washington Post/Monkey Cage

Photo: An employee works in the Huawei Technologies customer service center in Brussels. (Geert Vanden Wijngaert/Bloomberg)

The United States is pushing back on Chinese access to U.S. technology: On Thursday, federal prosecutors filed racketeering and conspiracy charges against Huawei, a Chinese company that has long been on the U.S. government’s radar. Last week, Attorney General William P. Barr said the Chinese “are attempting to capture the benefit of our free society by the outright stealing of our technology.”

On Feb. 6, FBI Director Christopher A. Wray said, “no country poses a greater threat than Communist China” as he announced close to a thousand investigations into possible Chinese theft of technology involving U.S. companies, universities and a number of research scientists.

Does this heated rhetoric capture what’s really happening between China and the United States? Here’s what you need to know.

Knowledge travels in different ways

It’s important to distinguish among three different ways in which technological knowledge moves between the United States and China. The first mode — as Barr’s statement emphasizes — involves direct theft of U.S. technology by Chinese firms or agents. This can include industrial espionage, or duplicating and using technology without legally licensing it. This is why many U.S. firms see the defense of intellectual property rights as vital — and central to U.S. trade policy.

The second tech transfer mode comes via a kind of hard-edge industrial policy. China has long required many of the foreign firms entering Chinese markets to form joint ventures or otherwise share their technology with Chinese subsidiaries.

On top of that, the Chinese government provides large subsidies for technological development that may give its firms global market advantages. Barr complains about Beijing’s Made in China 2025 plan, for instance, calling it “a sustained, highly coordinated campaign to replace the United States as the dominant technological superpower.”

About the Author

Peter A. Hall

Peter A. Hall

Resident Faculty & Seminar Co-chair

Peter Hall is Krupp Foundation Professor of European Studies in the Department of Government at Harvard University and resident faculty at the Minda de Gunzburg Center for European Studies. He has ...