"Protect Technological Hegemony" US Invests Hundreds of Trillions in AI and Semiconductors... Also Checks China [Tech War, Birth of Advanced Nations]

[Image source=AP Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] There is no doubt that the United States is one of the world's leading technology powerhouse countries. The advanced technologies that have contributed to the U.S. becoming the global leader now serve as the foundation for innovation across various sectors including industry, economy, society, culture, and national security.

In the so-called ‘Pax Technica’ era, the U.S. strategy to maintain this technological superiority can be summarized into three main points: continuous investment in advanced technology, stabilization of supply chains, and countering China’s challenge to its hegemony.

◇ $320 trillion investment in AI, semiconductors, and more

The clearest example of the Biden administration’s commitment to securing technological sovereignty is the ‘United States Innovation and Competition Act (USICA),’ passed by bipartisan support in Congress last June. This is a package of seven bills aimed at securing the U.S.’s advanced technology competitiveness and countering China. It involves an investment of $250 billion (approximately 320 trillion KRW) over five years to comprehensively support advanced technology sectors such as artificial intelligence (AI), semiconductors, biotechnology, and quantum technology. Additionally, in February this year, the U.S. House of Representatives passed the ‘America COMPETES Act (ACA),’ which allocates $52 billion to foster the domestic semiconductor industry.

Specifically, to maintain technological hegemony, the U.S. has selected ten strategic technology fields directly linked to national technological competitiveness and is striving to secure leadership. These fields cover both foundational and applied areas, ranging from AI, machine learning, autonomous driving to quantum computing, biotechnology and genomics, advanced energy, and advanced materials. The government plans to invest more than $120 billion (approximately 154 trillion KRW) over five years starting this year in basic and advanced technology research by expanding public investment.

Recently, emphasis has been placed on stabilizing supply chains. This is based on the judgment that achieving technological sovereignty in key areas such as semiconductors and next-generation communications requires ‘self-reliance’ in supply chains. The U.S. is investing over $50 billion over five years starting this year to boost domestic semiconductor production and develop open wireless communication models based on next-generation software. For semiconductors, often called the ‘rice of industry,’ the approach includes expanding R&D investment while providing incentives to strengthen the domestic manufacturing base.

In particular, the COVID-19 pandemic, which disrupted global supply chains, has become a catalyst for the U.S. to intensify efforts toward supply chain self-reliance. President Biden has recently openly expressed his ambition to rebuild the semiconductor manufacturing supply chain so that all semiconductors are ‘Made in USA.’ During his recent three-day visit to South Korea last month, the first place President Biden visited was Samsung’s advanced semiconductor plant in Pyeongtaek.

◇ Tech and economic war with China

The most important strategy for the U.S. to secure technological hegemony is its containment of China, which is advancing its semiconductor industry. A few years ago, during the Trump administration, the U.S. targeted Huawei, a leading 5G company, citing national security concerns. Recently, U.S. sanctions against Chinese companies have expanded aggressively into areas such as semiconductors, AI, and biotechnology.

Technology has literally emerged as the core frontline. The number of Chinese companies listed on the U.S. Treasury and Commerce Department blacklists is increasing every year. This is interpreted as a clear indication that the Biden administration intends to prevent U.S. technology and capital from being used as a foundation for China’s technological rise.

To curb China’s growing military and economic influence in the international community, the U.S. is strengthening cooperation not only with its traditional Atlantic allies in Europe but also with countries in the Indo-Pacific region. Following the Quad, which includes the U.S., India, Japan, and Australia, the U.S. recently launched the Indo-Pacific Economic Framework (IPEF), an economic cooperation body.

There is also analysis that President Biden’s upcoming efforts to improve relations with Saudi Arabia next month are motivated by technological alliances behind the scenes of the recent oil price surge. The U.S. political media outlet Politico reported, citing senior officials, that President Biden plans to announce extensive partnership plans in clean energy, space technology, and cybersecurity during his visit to Saudi Arabia. This is also interpreted as a move to counter China, with which the U.S. is fiercely competing for technological hegemony.

Vinod Khosla, founder of Khosla Ventures and a legendary Silicon Valley venture investor, predicted a ‘Techno-Economic War,’ stating, “The U.S. and China will engage in a large-scale war centered on technology and economy over the next 20 years.”