BEIJING ¨C In the waning days of Barack Obama¡¯s administration, one of the president¡¯s advisory councils issued a report warning of China¡¯s plans to snatch control of the critical semiconductor industry. Its recommendation: ¡°Win the race by running faster.¡±
It is sound advice, but the new administration isn¡¯t listening. Donald Trump¡¯s policies, in fact, offer a road map for how not to compete with China.
That¡¯s because team Trump doesn¡¯t fully grasp the threat China now poses to the U.S. economy. China is marshaling massive resources to march into high-tech industries, from robotics to medical devices. In the case of semiconductors alone, the state has amassed $150 billion to build a homegrown industry. In a report in March, the European Union Chamber of Commerce in China pressed the point that the Chinese government is employing a wide range of tools to pursue these ambitions, from lavishing subsidies on favored sectors to squeezing technology out of foreign firms.
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