Tag Archive for: techno-nationalism

It’s not just software. Physical critical equipment can’t be trusted, either

Just auditing the software in critical equipment isn’t enough. We must assume that adversaries, especially China, will also exploit the hardware if they can.

The latest report on the dangers from China-made solar inverters is a strong reminder that the physical part of equipment must not be trusted. Reuters said on 15 May that investigators had discovered rogue communication modules embedded in Chinese solar inverters installed in critical US energy infrastructure.

These ghost machines, capable of wireless data transmission, had not been declared by the manufacturers and had no documented function. They were, in effect, silent participants on the US grid.

No specific act of sabotage has been confirmed, but the purpose of the devices is unclear. Are they passive intelligence collectors, quietly contributing to foreign data aggregation? Or are they latent access points with offensive potential, waiting to be activated?

Inverters could be coordinated to disrupt voltage regulation or overload circuits across distributed energy resources, causing instability or damage to grid infrastructure.

Presence of the rogue communications modules in the inverters reminds us that adversaries can exploit vulnerabilities hidden deep in hardware, creating potential strategic leverage across essential systems.

As globalisation enters a new phase defined by contested technologies and fragmented supply chains, treating hardware as implicitly trustworthy builds hidden risks into the systems designed to ensure our national resilience.

Governments and industries have embraced zero-trust security models, in which no user, device or connection is trusted by default. But, too often, this principle is only applied to software and user access, not to the hardware operating inside our critical systems. Physical infrastructure, such as the devices that run power, water and transport systems, is rarely scrutinised to the same degree. In part, that’s because hardware threats are harder to observe, difficult to attribute, and require specialised tools and skills to detect.

This is a dangerous oversight.

Modern infrastructure is not a single system. It is a complex patchwork of such globally sourced equipment as sensors, inverters, routers and gateways. Many of these devices run proprietary firmware, are updated irregularly and operate with little visibility once installed. The complexity is such that no single organisation, and often no single person, fully understands how it all works. Much like modern vehicles, we no longer repair these systems part by part. We replace entire black-box subsystems, trusting that what’s inside the new ones will be what we expect.

Inverters and controllers similar to those exposed in the United States are deployed across Australia’s solar energy sector, particularly in residential and commercial-scale distributed energy resources. Many are connected to the grid and managed remotely via mobile networks.

The structural risks highlighted in the US investigation almost certainly exist here. It’s likely we simply haven’t looked closely enough. We may not even know how to look or where to start.

So far, Australia’s policy focus has been on network security and operational resilience. The Security of Critical Infrastructure Act and its Risk Management Program reforms have strengthened awareness and governance. But hardware integrity remains a blind spot. Vendors are often evaluated based on documentation or country of origin. Few components are independently tested for physical or embedded threats. Even fewer are built with tamper evidence or verifiable firmware.

So what would a zero-trust model for hardware look like? It starts with rejecting assumptions. Devices used in critical environments should be able to prove they are genuine and unaltered, using cryptographic signatures that can be independently verified. Firmware should be auditable and digitally signed. Hardware platforms need runtime integrity checks, tamper detection and the ability to isolate or disable compromised components. These capabilities exist today but are rarely adopted at scale.

Procurement models must also evolve. Hardware cannot be selected from trusted supply chains on cost-efficiency alone. It requires a broader risk lens, one that accounts for consequence, likelihood, adversary capability and intent. Mitigation may require investment in local capacity, or co-development with partners that share our security posture. Where equipment cannot come from reliable foreign countries, governments must cultivate domestic sources.

This is not about closing off our economy. It is about building resilience. In a contested region, the ability to operate independently of hostile actors may determine national outcomes.

We must also let go of the idea that trust is permanent. Zero-trust is not a one-off assessment; it’s a posture of continuous verification. Supply chains evolve. Vendors change hands. Firmware updates introduce new code. Just as we monitor software over time, we must now monitor the behaviour and integrity of the physical devices that carry our systems.

The ghost machines uncovered in US infrastructure cannot be understood as an isolated glitch. They represent a deliberate strategy: embedding long-term access and influence into the physical core of critical systems.

Australia has made progress in recognising cyber threats as national security challenges. The next step is to extend that awareness to hardware.

We cannot secure the future while building on unexamined trust.

Indonesia is hooked on Huawei

Huawei dominates Indonesia’s telecommunication network infrastructure. It won over Indonesia mainly through cost competitiveness and by generating favour through capacity-building programs and strategic relationships with the government, and telecommunication operators.

But Huawei’s dominance poses risks. It constrains Indonesia’s digital sovereignty and limits its strategic autonomy. To remain in control, Indonesia must take the issue of dependence seriously and incorporate strategic considerations in telecommunications decision-making.

Indonesia’s digital transformation is largely driven by the private sector, especially telecommunications operators. These operators depend on network equipment from foreign vendors. So foreign vendors serve as the backbone of national connectivity—and Huawei has long been recognised as a major player.

In 2019, then Indonesian minister of communication and information technology, Rudiantara, acknowledged Huawei’s significant role in the country’s telecommunications sector. The CFO of telecommunications operator XL Axiata echoed this, estimating that 60 to 70 percent of the industry relied on Huawei.

However, while Huawei is omnipresent in Indonesia’s digital infrastructure, the level of its market share has long remained unclear.

ASPI now has evidence of Huawei’s extensive dominance in Indonesia’s telecommunication equipment market. Based on an overview of major capital expenditure by some of Indonesia’s key telecommunications operators—XL, Indosat and Smartfren—we have found that 70 percent of their network equipment in 2024 came from Huawei. Information from Telkomsel, Indonesia’s largest telecom operator, was unavailable, but our finding still confirms that Huawei is a dominant provider of telecommunications network equipment to Indonesia. It has gained this position at the expense of older suppliers, including Ericsson, Nokia and Alcatel.

Vendors’ market share of operators’ major capital expenditure. Source: XL Axiata, Indosat OH and Smartfren financial statements. ZTE data annualised from Smartfren financial statements.

Technical and commercial considerations determine vendor selection in Indonesia. On the technical side, factors such as product lifecycle and the use of artificial intelligence play a significant role. Commercially, operators focus on costs, including payment terms.

Huawei’s cost competitiveness stems from state subsidies from the Chinese government, including tax breaks and support for research and development. These allow Huawei to offer competitive commercial terms, undercutting rivals. It can also provide competitively priced network maintenance services, as shown in its outsourcing agreement with XL Axiata.

Beyond costs, Huawei has also been able to win influence by offering a wide range of extra support, especially in the form of capacity-building. For instance, it has supported key government agencies—including the presidential palace, National Cyber and Crypto Agency and the military—by providing them with cybersecurity training.

Huawei has also established training centres and organised cybersecurity workshops at major Indonesian universities and vocational schools. Furthermore, Huawei actively cultivates relationships with influential policymakers and politicians by inviting them to Huawei headquarters and signing capacity-building agreements. A prominent official frequently engaged is Luhut Pandjaitan, a powerful political figure in the cabinet of former president Joko Widodo who now serves as chair of President Prabowo Subianto’s National Economic Council.

The Indonesian government has minimal involvement in vendor selection. Although laws exist on personal data protection and cybersecurity, there is no regulatory framework for assessing vendor dependency risks in the telecommunications sector or for assessing risks of vendors to national or economic security. Under the Science Act, the Ministry of Research and Technology can audit strategic technologies such as energy and agricultural technologies. However, there is limited public evidence of such audits occurring. This regulatory vacuum leaves Indonesia vulnerable to overdependence on a single foreign telecommunications vendor.

At the macro level, Huawei’s dominance exposes Indonesia to geopolitical risk. As the tech rivalry between the United States and China intensifies, Huawei—as well as ZTE—remains subject to restrictions in many Western economies. So Jakarta’s access to technology from Western countries could be limited and exacerbated by Huawei’s entrenchment in existing 4G infrastructure. Simply, Jakarta’s dependence on Huawei jeopardises its strategic autonomy: it has no real options.

At the micro level, Huawei’s market power puts operators at a significant disadvantage in negotiations; they’re simply price takers. Being reduced to price takers strips operators of their bargaining power: they are left vulnerable to the prospect of inflated costs dictated by Huawei, as switching vendors is complex and financially burdensome, creating a lock-in effect for next generation digital infrastructure. This effect could result in higher capital expenditure for operators, with costs passed on to consumers. Ultimately, Indonesians may face higher service prices, as their access to digital services becomes increasingly dependent on a single company.

These risks will escalate with the rollout of 5G. Unlike previous generations, 5G will underpin critical applications at the enterprise level, where any security lapse could have severe consequences. Now that Indonesia is so involved with Huawei, real alternatives are scarce. This not only has technical or commercial consequences, but it will also have political ramifications, where Indonesia’s strategic autonomy could be compromised. Hence, it is essential for the government to take a more active role in overseeing vendor selection and managing the risks associated with dependency on a single supplier.

The US has many chip vulnerabilities

Although semiconductor chips are ubiquitous nowadays, their production is concentrated in just a few countries, and this has left the US economy and military highly vulnerable at a time of rising geopolitical tensions. While the United States commands a leading position in designing and providing the software for the high-end chips used in AI technologies, production of the chips themselves occurs elsewhere. To head off the risk of catastrophic supply disruptions, the US needs a coherent strategy that embraces all nodes of the semiconductor industry.

That is why the CHIPS and Science Act, signed by President Joe Biden in 2022, provided funding to reshore manufacturing capacity for high-end chips. According to the Semiconductor Industry Association, the impact has been significant: currently planned investments should give the US control of almost 30 percent of global wafer fabrication capacity for chips below ten nanometres by 2032. Only Taiwan and South Korea currently have foundries to produce such chips. China, by contrast, will control only 2 percent of manufacturing capacity, while Europe and Japan’s share will rise to about 12 percent.

But US President Donald Trump is now trying to roll back this strategy, describing the CHIPS Act—one of his predecessor’s signature achievements—as a waste of money. His administration is instead seeking to tighten the export restrictions that Biden introduced to frustrate China’s AI ambitions.

It is a strategic mistake to de-emphasise strengthening domestic capacity through targeted industrial policies. Coercive measures against China not only have proved ineffective, but may have even accelerated Chinese innovation. DeepSeek’s highly competitive models were apparently developed at a fraction of the cost of OpenAI’s. A substantial share of the semiconductors used in DeepSeek’s R1 model comprises chips that were smuggled through intermediaries in Singapore and other Asian countries, and DeepSeek relied on clever engineering techniques to overcome the remaining hardware limitations it faced. Meanwhile, Chinese tech giants such as Alibaba and Tencent are developing similar AI models under similar supply constraints.

Even before the DeepSeek breakthrough, there were doubts about the effectiveness of US trade restrictions. The Biden administration’s export ban, adopted in October 2022, targeted chips smaller than 16nm, banning not only exports of the final product, but also the equipment and the human capital needed to develop them. Less than a year later, in August 2023, Huawei launched a new smartphone model (the Mate 60) that uses a 7nm chip.

Even if China no longer has access to the most advanced lithography machines, it can still use old ones to produce 7nm chips, albeit at a higher cost. While these older machines do not allow it to go below 7nm (Taiwan Semiconductor Manufacturing Company is working on 1nm chips), Huawei and DeepSeek’s achievements are a cautionary tale. China now has every reason to develop its own semiconductor industry, and it may have made more progress than we think.

To reduce its own supply-chain vulnerabilities, the US cannot rely on an isolationist reshoring-only approach. Given how broadly the current supply chain is distributed, leveraging existing alliances is the only viable way forward. ASML, the Dutch firm with a near-monopoly on the high-end lithography machines used to make the most advanced chips, cannot simply be recreated overnight.

So far, the US has focused on reducing security risks related to the most sophisticated chips, giving short shrift to the higher-node chips that are needed to run modern economies. Yet these legacy chips (those above 28nm) are key components in cars, airplanes, fighter jets, medical devices, smartphones, computers and much more.

According to the Semiconductor Industry Association, China is expected to control almost 40 percent of global wafer fabrication capacity for these types of chips by 2032, while Taiwan, the US and Europe will account for 25 percent, 10 percent, and 3 percent, respectively. China will thus control a major strategic chokepoint, enabling it to bring the US economy to a halt with its own export bans. It also will have a sizable military edge, because it could impair US defences by cutting off the supply of legacy chips. Finally, China’s security services could put back doors into Chinese-made chips, allowing for espionage or even cyberattacks on US infrastructure.

Compounding the challenge, Chinese-made chips are usually already incorporated into final products by the time they reach the US. If the US wants to curtail imports of potentially compromised hardware, it will have to do it indirectly, tracking down chips at customs by dismantling assembled products. That would be exceedingly costly.

Fortunately, the US does not lack policy tools to reduce its vulnerabilities. When it comes to military applications of legacy chips, it can resort to procurement restrictions, trade sanctions (justified on national-security grounds), and cybersecurity defences. As for expanding domestic production capacity, it can use anti-dumping and countervailing duties to counter unfair Chinese practices, such as its heavy subsidisation of domestic producers.

Chips, and the data they support, will be the oil of the future. The US needs to devise a comprehensive strategy that addresses the full range of its current vulnerabilities. That means looking beyond the most advanced chips and the AI race.

South Korea has acted decisively on DeepSeek. Other countries must stop hesitating

South Korea has suspended new downloads of DeepSeek, and it was were right to do so.

Chinese tech firms operate under the shadow of state influence, misusing data for surveillance and geopolitical advantage. Any country that values its data and sovereignty must watch this national security threat and take note of South Korea’s response.

Every AI tool captures vast amounts of data, but DeepSeek collects data unnecessary to its function as a simple chatbot. The company was caught over-collecting personal data and failed to be transparent about where that data was going. This typifies China’s lack of transparency about data collection, usage and storage.

South Korea’s National Intelligence Service flagged the chatbot for logging keystrokes and chat interactions, which were all stored on Chinese-controlled servers.

Once data enters China’s jurisdiction, it’s fair game for Beijing’s intelligence agencies. That’s not paranoia; it’s the law. Chinese companies must hand over data to the government upon request. South Korea saw the writing on the wall and acted before it was too late.

Data in the wrong hands can be weaponised. By cross-referencing DeepSeek’s collected data with other stolen datasets, Chinese intelligence agencies could build profiles on foreign officials, business leaders, journalists and dissidents. Keystroke tracking could help to identify individuals even when they use anonymous communication platforms. AI-powered analysis could pinpoint behavioral patterns, making it easier to manipulate public opinion or even blackmail individuals with compromising data.

If this sounds familiar, you’re not mistaken. Huawei was banned from operating 5G networks in multiple countries based on similar concerns. TikTok has come under scrutiny for its ties to the Chinese government. China has spent years perfecting cyber-espionage and DeepSeek appears to be the latest tool in its arsenal, joining the growing list of Chinese tech products raising red flags.

Chinese actors have displayed a pattern of digital intrusion. Recent events include the Volt Typhoon and Salt Typhoon operations, which targeted US digital infrastructure and telecom networks. These attacks compromised the data of more than one million people, including government officials. Looking to Europe, Germany fell victim to Chinese-backed hackers breaching its federal cartography agency.

China is using AI tools for influence, data gathering and geopolitical maneuvering. AI is a versatile tool through which the flow of information is controlled.

The risk goes far beyond espionage. It extends to economic coercion and intellectual property theft. For example, multinational companies relying on AI-powered tools may unknowingly send sensitive business strategies to foreign adversaries. Government agencies may unknowingly feed points of information that would be classified in aggregate into an AI system that Beijing can tap into. The consequences would be far-reaching and deeply troubling.

What if South Korea had looked the other way? Millions of South Korean citizens would have been at risk of Chinese coercion and exposed to data harvesting under the guise of harmless AI. In an era where data shapes power, handing control to foreign entities is dangerous.

Some countries are beginning to grasp these threats. India and Australia are ramping up scrutiny of foreign AI applications, and Australia and Taiwan have banned DeepSeek on government devices. The European Union is tightening regulations to demand transparency and accountability for data usage.

The United States, on the other hand, is still deliberating. President Donald Trump has focused on AI as a push for Silicon Valley to lift its game, rather than considering the technology’s national security implications. US lawmakers are beginning to propose restrictions on AI tools linked to foreign adversaries. For Texan officials and US navy personnel, for example, DeepSeek has been banned due to its links to the Chinese government.

However, regulatory action has been slow to gain traction, caught in a web of political disagreements and lobbying pressures. Meanwhile, security agencies warn that inaction could leave critical infrastructure and government institutions vulnerable to AI-driven espionage. Without decisive policies, the US risks becoming not only a prime target for data manipulation and intelligence gathering, but a soft target. It must act to prevent another major data breach, before it finds itself reacting to one. Waiting is not an option.

China’s AI ambitions aren’t slowing down, and global vigilance must not flag. The battle for digital sovereignty is already underway, and governments that hesitate will find themselves at a disadvantage from both economic and security standpoints.

Act now or pay later. AI is the new frontier of global competition, and data is the ultimate weapon. Those who don’t secure it will face the consequences. South Korea made the right move—who’s next?

As Trump sacks scientists, Australia should hire them. US drain is our brain gain

US President Donald Trump, his powerful offsider Elon Musk and his Department of Government Efficiency (DOGE) are slashing public spending in an effort to save US taxpayers anywhere between US$500 billion and US$2 trillion.

Caught up in these enormous cuts are scientists, researchers, medical experts, technologists and PhD scholars who are losing jobs, grants and scholarships at an unprecedented rate as funding streams are cancelled or put on hold.

To date, DOGE has allegedly made only US$105 billion of cuts. This means they have, at minimum, hundreds of billions to go. In the science and technology sector, these early cuts may be just the beginning.

Believe it or not, there is an enormous opportunity for Australia in this unusual situation. If the government acts quickly, this is a once-in-a-century brain gain opportunity.

Australia should take a two-pronged approach. We should attract some of our best and brightest back home from places such as Silicon Valley while also offering fast-track visas to top US-based scientists and researchers who are newly out of a job or low on the funding they need to keep their start-up or scientific lab running.

Australia’s ability to keep up with rapid advances in scientific developments and critical technologies will determine the shape and size of our economy for decades to come. Most of our strategic partners—the United States, Japan, Britain, the European Union and South Korea—are larger and have globally competitive tech sectors they’ve spent decades building. In recent years, these have included artificial intelligence, semiconductors, quantum and biotechnology.

As a mid-sized mining and tourism-dependent economy, Australia has long known we need to diversify our economy and increase our low national spend on research and development, which sits well below the OECD average.  We also know we need greater self-sufficiency so we don’t continue to become over-reliant on any one single market for access to technologies we have deemed ‘critical’ to our future. Building greater sovereign capability in our science and technology sector is a more important goal than ever.

But we are struggling to keep pace with others. We haven’t spent decades investing in building up our tech sector or making big technological bets when we’ve had the opportunity. Things are now moving so quickly that we’re increasingly in danger of being completely left behind.

Coming from behind doesn’t mean we can’t catch up. It does mean, however, that we need to prioritise innovative and out-of-the-box thinking and we must take more risks.

In early 2025, we find ourselves in an unusual situation where our closest ally has, rather unexpectedly, flooded the global market with science and technology talent. The cuts are ongoing and broad, impacting almost everything, including medical schools advancing cancer prevention, high-performance computing, climate and oceanic analysis and the use of AI in national security work.

Other countries will respond to this opportunity quickly. As public funding into universities declines and US universities reduce PhD admissions, top Chinese universities are already proactively recruiting overseas students, allowing undergraduates to skip traditional pathways to fill up PhD programs in areas such as mathematics, engineering, computer science and environmental science.

Canada, seen as a global leader for attracting technology talent, will likely be a key beneficiary of this talent flood. Its variety of visas, low processing times and proactive talent recruitment campaigns is one reason it recently saw 10,000 foreign tech workers in the US apply for permanent residency in Canada in one 48-hour period.

For decades, the US has provided funding and a home for many of our scientists, entrepreneurs and technologists. Now there’s a unique opportunity for us to reverse that brain drain while also increasing our investment in US talent and technologies. In doing so, we’d be contributing to greater burden-sharing in the US-Australia alliance (specifically AUKUS Pillar 2), noting that Australia has long benefited from—even piggybacked—on US scientific advancements and breakthroughs made in everything from health to renewable energies to defence technologies.

In order to identify the types of scientists, researchers and technologists that would be of greatest benefit to Australia and the potential visa options open to them, the Department of Home Affairs should work with our diplomats, our defence, CSIRO and Department of Industry Science and Resources officials, our intelligence community, and others to form a small, agile taskforce.

Minister for Home Affairs Tony Burke should work with parliamentary colleagues and his department to quickly explore options to expand and fast track visas. Visa options must be fast and flexible or we’ll lose out to other countries vying for their expertise.

Australia’s ambassador in the US, Kevin Rudd, and his team are well placed to provide a picture of which top scientists have lost funding. They could work with others in government to promote Australia as a top destination for technology talent while also working collaboratively with the US government to explain how these investments would also benefit them.

The government can play a key knowledge broker role by helping to link up scientific labs and startups with grant opportunities, universities and venture capital firms open to investing in them. In exceptional cases, wealthy individuals should make an extraordinary contribution to Australia’s national interests by partnering with the government to attract outstanding scientists and their teams. This public-private investment may end up helping Australia through the next pandemic, provide us with a leading edge in AUKUS Pillar 2 technologies or devise a cure for Alzheimer’s. It could unearth new methods for environmentally sustainable and cost-competitive extraction of critical minerals. All would provide shared benefit to our alliance with the US and close partnerships.

Knowing Musk’s cuts will continue, the winner of the Australian election should assess and expand this talent drive, particularly given the inevitable benefits to our job market and national prosperity.

In 2025, in the concerning global environment we find ourselves in, a business as usual approach won’t cut it. Australia must be ready to jump on rare opportunities as they arise, take more risks and make big bets.

An enormous opportunity is here now. Soon it will be staring us in the face. It’s time for our parliamentarians to jump.

Amusing ourselves to death

Forty years ago, in a seminal masterpiece titled Amusing Ourselves to Death, US author Neil Postman warned that we had entered a brave new world in which people were enslaved by television and other technology-driven entertainment. The threat of subjugation comes not from the oppressive arm of authoritarian regimes and concentration camps but from our own willing submission and surrender.

‘Big brother does not watch us, by his choice. We watch him, by ours’, Postman wrote in 1985.

There is no need for wardens or gates or Ministries of Truth. When a population becomes distract­ed by trivia, when cultural life is redefined as a perpetual round of entertainments, when serious public conversation becomes a form of baby-talk, when, in short, people become an audience and their public business a vaudeville act, then a nation finds itself at risk; culture-death is a clear possibility.

Postman’s insight would have been spot-on had he written this today about TikTok. Postman was mostly thinking about mass media with a commercial imperative. People would be enslaved to superficial consumerism. But add a technologically advanced authoritarian power with platforms that—unlike terrestrial TV—are essentially borderless and can reach around the globe, and you have George Orwell’s Big Brother put together with Aldous Huxley’s cultural and spiritual entropy.

Addictive digital entertainment can be corrosive even without a malign puppeteer. But with an entity such as the Chinese Communist Party fiddling the algorithms, it could be catastrophic.

Just in 2025, we have seen much of the Western world so spellbound by TikTok that the thought of living without it brought on the anguish normally reserved for the impact of conflict. ‘TikTok refugees’ became a description, as though they had been displaced like Jews fleeing Europe or Yazidis escaping Islamic State.

Postman noted that we were innately prepared to ‘resist a prison when the gates begin to close around us … But what if there are no cries of anguish to be heard? Who is prepared to take arms against a sea of amusements?’

The cries of anguish were depressingly muted as TikTok built up a following in Western countries that now means four in 10 Americans aged under 30 get their news from TikTok, according to a recent survey by the Pew Research Center.

When a ban was flagged, the cries came from those who couldn’t bear to give up the platform and from free speech absolutists who believed any rules amounted to government overreach. If our most popular radio stations had been based in Germany in the late 1930s, the Soviet Union during the Cold War or Syria during the ISIS caliphate, our leaders would have protected the public, regardless of popularity and notwithstanding that it would constitute government intervention in the so-called free market of ideas.

In fact, the market isn’t free because powerful actors can man­ipulate the information landscape.

Billionaire Elon Musk gives free-speech advocates a bad name by posting not just different opinions but promoting false content on issues such as Ukraine on his platform X. But more sinister is a platform such as TikTok, which is headquartered in authoritarian China and ultim­ately at the control of the CCP, with algorithms that have been demonstrated to manipulate audiences by privileging posts that serve Beijing’s strategic interests and downgrading content that does not.

Despite such threats, we have no clear framework to protect ourselves from powerful information platforms, including the newest generative artificial intelligence models such as DeepSeek, which will be increasingly available—and, thanks to their affordability, attractive—despite operating under Chinese government control. As a US court declared in upholding the congressional ban on TikTok, giving a foreign power a vector to shape and influence people’s thinking was a constraint on free speech, not an enabler of it.

Freedoms of speech and expression are core democratic principles but they need active protection. This means the involvement of governments.

US Vice-President JD Vance told the Munich Security Conference that Donald Trump represented a ‘new sheriff in town’ who would defend free speech and ‘will fight to defend your right to offer it in the public square, agree or disagree’. It was an admirable derivative of the quote attributed to Evelyn Beatrice Hall describing Voltaire’s principle of ‘I may not agree with what you say, but I will defend to the death your right to say it’. But just as we have regulators for financial and other markets, we need regulation of our information markets.

By all means, speech should be as free as possible. Awful mustn’t equal unlawful, to borrow Australian Security Intelligence Organisation boss Mike Burgess’ phrase. Speech that hurts the feelings of others or advocates unpopular views cannot be the threshold for censorship. Such lazy and faint-hearted policymaking creates only a more brittle society. But that doesn’t mean we should make ourselves fish in a barrel for malign foreign powers.

Anarchy is not freedom. Governments need to brave the minefield that is modern information technology. If a platform poses risks that cannot be avoided, as with TikTok, it should be banned.

Other platforms that sit within democratic nations’ jurisdictions should be subjected to risk mitigations such as content moderation to deter and punish criminal activity. X, Facebook, Instagram and YouTube can be used as avenues for information operations, as shown by Russia buying advertisements on Facebook or CCP-backed trolls posting on X and YouTube, or be used as vectors for organised crime. Even the most ardent free-speech advocates would agree that drug trafficking, child abuse or joining a terrorist group are illegal offline and therefore should be illegal online.

No marketplace remains free and fair when governments overregulate or abdicate responsibility.

The once-free markets of trade and investment have been eroded by China to such an extent that just this week Trump issued a foreign investment policy to protect US ‘critical technology, critical infrastructure, personal data, and other sensitive areas’ from ‘foreign adversaries such as the PRC’, including by making ‘foreign investment subject to appropriate security provisions’.

A key principle of the new presidential policy is that ‘investment at all costs is not always in the national interest’.

In other words, security measures and rules keep US critical infrastructure free.

While it has not yet gained much media attention, it is among the most important economic security policies ever taken to counter Beijing’s objective to ‘systematically direct and facilitate investment in United States companies and assets to obtain cutting-edge technologies, intellectual property and leverage in strategic industries’, and all of the US’s allies and democratic partners should publicly support it and implement it domestically.

We like to think that technologies are neutral mediums that are only vehicles for improvement. As Postman wrote, this belief often rises to the status of an ideology or faith.

‘All that is required to make it stick is a population that devoutly believes in the inevitability of progress’, he wrote. ‘And in this sense … history is moving us toward some preordained paradise and that technology is the force behind that movement.’

Science and technology have of course delivered extraordinary improvements to our health, our economic productivity, our access to information and our ability to connect with other people regardless of geography—provided we engage with it wisely. We must not become cynical about technology entirely, which is why we must maintain control over it and ensure it serves our interests.

The ultimate solution is knowledge and participation. As Postman concluded, the answer must be found in ‘how we watch’. With no discussion on how to use technology, there has been no ‘public understanding of what information is and how it gives direction to a culture’.

Postman wrote that ‘no medium is excessively dangerous if its users understand what its dangers are’. For that to happen, education was the ‘solution to all dangerous social problems’.

He insisted we were ‘in a race between education and disaster’.

To give education a fighting chance, especially against the predations of technologically capable authoritarian powers, democratic governments need to exert responsible and judicious regulation of technology to perform their most basic duty of protecting the freedom of their citizens.

US cuts to science and technology could fast-track China’s tech dominance

Is the United States now trying to lose the technology race with China? It certainly seems to be.

The race is tight, and now the Trump administration is slashing funding for the three national institutions that have underpinned science and technology (S&T) and what advantage the US still has.

China is outpacing the US in the volume of high-impact research in 57 of the 64 critical technologies in ASPI’s Critical Technology Tracker. The US’s main remaining advantage is downstream in implementing technology, and even that’s at risk as China’s significant S&T investments pay off.

Now the US’s lead may disappear even faster following cuts to the National Institutes of Health (NIH), National Aeronautics and Space Agency (NASA) and National Science Foundation (NSF).

The NIH is the biggest public funder of biomedical research worldwide and impacts global health in ways often taken for granted. For example, it supported the foundational work that led to the Haemophilus influenzae type b vaccine which, by some estimates, prevented 1.2 million infant deaths between 2000 and 2015. NASA is a stalwart of space research and inadvertently has contributed to medical innovations as it has attended to the health of its astronauts, such as the ear thermometer. The NSF funds all non-medical scientific research (biology, quantum computing, artificial intelligence, space and advanced materials) in the US and manages major research facilities.

The NIH stands to lose $4 billion out of the $32 billion already allocated to US research grants in 2024. This $4 billion cut is not just 11.4 percent of the NIH’s research grants; it will also limit its ability to cover indirect costs associated with equipment, maintenance, safety and personnel—everything that keeps world-class research facilities ticking.

According to The New York Times, indirect costs make up 29 percent of grant funds on average. With only 85 out of 613 institutions having indirect costs below 15 percent, a decision to cap indirect costs at 15 percent will at least halve the funds for maintaining labs for most NIH grant recipients.

If you are a grand-slam-winning tennis champion, these indirect costs are akin to the payments for your team of coaches, strategists, medical entourage, all your equipment and access to training facilities. Without these, you won’t stay at number one. It’s the same in the critical technology race.

Typically, labs and other research facilities have state-of-the-art equipment, which have indirect costs commensurate with their level of sophistication. This means that high-level labs—where breakthroughs often happen—have more to lose when funding is cut for indirect costs.

The biggest losers in these cuts will be top US universities, medical schools and hospitals, many of which are among the top 10 institutions in the Tech Tracker for biotechnologies, including MD Anderson Cancer Center, Memorial Sloan Kettering and many teaching hospitals within the Harvard Medical School. The NIH not only provides research funding in the biomedical fields; it also has 27 biomedical research institutions. The NIH combined is currently ranked second for vaccines and medical countermeasures and eighth for genetic engineering in the Critical Technology Tracker, highlighting its global importance and competitiveness.

NIH-funded research has contributed to early detection and prevention of cancers, chemotherapy and immunotherapy. The NIH also helped develop vaccines for flu and RSV (Respiratory Syncytial Virus), as well as the mRNA Covid-19 vaccine. These are the very institutions that the US government will rely on to develop the future vaccines needed to protect Americans from the next global pandemic.

In addition, in early February, biomedical research was again in the firing line with termination letters sent to hundreds of employees at the Centers for Disease Control and Prevention, the Food and Drug Administration, and the NIH. More job cuts are expected to follow, further weakening the sector.

Around the same time, the NSF froze all grant review processes to comply with new directives to end all diversity, equity, and inclusion (DEI) programs. According to the Washington Post, NSF staff were tasked with scrutinising active research grants—preciously approved by peer review—with a list of keywords including ‘women’, ‘diverse’ and ‘institutional’ to reverse any grants remotely related to DEI initiatives.

On 18 February, the haemorrhage of US S&T talent continued with a 10 percent cut to the NSF workforce. Given the NSF’s annual budget of $9 billion, the effect of this cut will be felt across all technologies. The Computer Research Association, for example, predicts devastating consequences for scientific innovation and talent in AI technologies and high performance computing, as the NSF funds 80 percent of fundamental computing research at US institutions. The association credits foundational US technologies behind AI, cybersecurity and quantum technologies to NSF funding.

The Critical Technology Tracker ranks the US first in quantum computing, with seven of the top 10 institutions based in the US. However, quantum technologies are priority areas for China, which unveiled its most advanced quantum computer, a 504-Qubit Superconductor, in December 2024. In 2022, the NSF’s Directorate for Technology, Innovation and Partnerships was set up to accelerate the implementation of NSF-funded discoveries from research to new industries, especially in technologies where the US faced the greatest competition. According to Reuters, the directorate lost 20 percent of its staff last week.

Similarly, NASA, currently ranked first in space launch systems research in the Tech Tracker, may face a 10 percent cut to its specialised workforce. These massive cuts have been put on hold, but if they resume, the loss of talent would be a blow to an important component of the technological race, especially with a worldwide shortage of tech specialists. Historically, US space and satellite companies have benefited from NASA’s decades-long public investments in research and development.

The Economist reported that the scrutiny of DEI programs extended to keywords related to climate change. The National Oceanic and Atmospheric Administration (NOAA) and NASA are therefore expecting major job cuts for their work in climate science and extreme weather patterns. The NOAA plays an important role in weather prediction. Its research on space and sensors is visible in the Tech Tracker across the areas of small satellites, gravitational sensors, and sonar and acoustic sensors.

While the US is cutting its funding, China continues its systematic, long-term investment in critical technologies. Synthetic biology is a sector in which China has the largest lead in the Tech Tracker. Over the past 5 years, China has published 57.7 percent of high-impact research in the field, while the US has produced just 13.1 percent.

Synthetic biology is the design and building of new biological systems. It has applications in many areas, such as agriculture and medicine, which directly affect food security and health. Like quantum computing, synthetic biology is an emerging technology where scientific innovation and intellectual property ownership can determine future industry dominance. Since 2006, China has prioritised synthetic biology and built a tech ecosystem around this emerging technology, comprising research institutes and industry.

As Drew Endy, a synthetic biologist from Stanford University, pointed out, the research infrastructure that China has built to support its all-of-nation approach to emerging biotechnology is now the envy of the world. The contrast between China’s investment strategy and the cuts imposed on the NIH could not be starker.

If the US doesn’t want to lose the S&T race with China, it must review its funding cuts. Reducing the funding envelope to grants organisations that oversee scientific grants, such as the NIH and NSF, will stifle the scientific innovations and breakthroughs that have been central to the rise of the US as a technology superpower.

Countries that have long relied on US technological research may need to step up spending on scientific research, or they, too, will risk being left behind.

DeepSeek is in the driver’s seat. That’s a big security problem

Democratic states have a smart-car problem. For those that don’t act quickly and decisively, it’s about to become a severe national security headache.

Over the past few weeks, about 20 of China’s largest car manufacturers have rushed to sign new strategic partnerships with DeepSeek to integrate its AI technology into their vehicles. This poses immediate security, data and privacy challenges for governments.  While international relations would be easier if it weren’t the case, China’s suite of national security and intelligence laws makes it impossible for Chinese companies to truly protect the data they collect.

China is the world’s largest producer of cars, and is now making good quality, low-cost and tech-heavy vehicles at a pace no country can match. It has also bought European industry stalwarts, including Volvo, MG and Lotus. Through joint ventures, it builds and exports a range of US and European car models back into global markets.

DeepSeek has struck partnerships with many large companies, such as BYD, Great Wall Motor, Chery, SAIC (owner of MG and LDV) and Geely (owner of Volvo and Lotus). In addition, major US, European and Japanese brands, including General Motors, Volkswagen and Nissan, have signed on to integrate DeepSeek via their joint ventures.

Australia is one of the many international markets where Chinese cars have gained enormous traction. More than 210,000 new cars were sold into Australia in 2024, and Chinese brands are set to take almost 20 percent of the market in 2025, up from 1.7 percent in 2019. Part of this new success is due to the government’s financial incentives encouraging Australians to purchase electric vehicles. China now builds about 80 percent of all electric vehicles sold in Australia.

Then, there are global markets where Chinese car brands are not gaining the market share they have in Australia (or in Russia, the Middle East and South America), but where Chinese-made cars are. This is the case in the United States and in Europe, for example. This is because many foreign companies use their joint ventures in China to sell China-made, foreign-branded cars into global markets. Such companies include Volkswagen, Volvo, BMW, Lincoln, Polestar, Hyundai and Kia.

Through its Chinese joint venture, Volkswagen will reportedly partner with DeepSeek. General Motors has also said it will integrate DeepSeek into its next-generation vehicles, including Cadillacs and Buicks. It’s unclear how many such cars may end up in overseas markets this year; that will likely depend on each country’s regulations.

It is not surprising that DeepSeek is a sought-after partner, with companies scrambling to integrate and build off its technology. It also shouldn’t have been a shock to see this AI breakthrough coming out of China—and we should expect a lot more. Chinese companies, universities and scientific institutions made impressive gains over the past two decades across most critical technology areas. Other factors, such as industrial espionage, have also helped.

But widespread integration of Chinese AI systems into products and services carries serious data, privacy, governance, censorship, interference and espionage risks. These risks are unlikely ever to go away, and few government strategies will be able to keep up.

For some nations, especially developing countries, this global integration will be a bit of a non-event. It won’t be seen as a security issue that deserves urgent policy attention above other pressing climate, human security, development and economic challenges.

But for others, it will quickly become a problem—a severe one, given the speed at which this integration could unfold.

Knowing the risks, governments (federal and state), militaries, university groups and companies (such as industrial behemoth Toyota) have moved quickly to ban or limit the use of DeepSeek during work time and via work devices. Regulators, particularly across Europe, are launching official investigations. South Korea has gone further than most and taken it off local app stores after authorities reportedly discovered that DeepSeek was sending South Korean user data to Chinese company ByteDance, whose subsidiaries include including TikTok.

But outside of banning employee use of DeepSeek, the integration of Chinese AI systems and models into data-hungry smart cars has not received due public attention. This quick development will test many governments globally.

Smart cars are packed full of the latest technology and are built to integrate into our personal lives. As users move between work, family and social commitments, they travel with a combination of microphones, cameras, voice recognition technology, radars, GPS trackers and increasingly biometric devices—such as those for fingerprint scanning and facial recognition to track driver behaviour and approve vehicle access. It’s also safe to assume that multiple mobile phones and other smart devices, such as smart watches, are present, some connecting to the car daily.

Then there is the information aspect—a potential influx of new AI assistants who will not always provide drivers with accurate and reliable information. At times, they may censor the truth or provide Chinese Communist Party talking points on major political, economic, security and human rights issues. If such AI models remain unregulated and continue to gain popularity internationally, they will expose future generations to systems that lack information integrity. As China’s internal politics and strategic outlook evolve, the amount of censored and false information provided to users of these systems will likely increase, as it does domestically for Chinese citizens.

Chinese built and maintained AI assistants may soon sit at the heart of a growing number of vehicles driven by politicians, military officers, policymakers, intelligence officials, defence scientists and others who work on sensitive issues. Democratic governments need a realistic and actionable plan to deal with this.

It may be possible to ensure that government-issued devices never connect to Chinese AI systems (although slip-ups can happen when people are busy and rushing), but it’s hard to imagine how users could keep most of their personal data from interacting with such systems. Putting all security obligations on the individual will not be enough.

Australia has been here before. Australia banned ‘high-risk vendors’ in from its 5G telecommunications network in 2018, and the debates leading up to and surrounding that decision taught us how valuable it was for the business community to be given an early and clear decision—something some other countries struggled with. Geostrategic circumstances haven’t improved since Australia banned high-risk vendors from 5G; unfortunately, they’ve worsened.

Australia’s domestic policy settings are also driving consumers towards the very brands that will soon integrate DeepSeek’s technology, which politicians and policymakers have been told not to use. Politicians from all parties test-driving BYD and LDV vehicles highlights that parliamentarians may need greater access to more regular security briefings to ensure they are fully across the risks, with updates provided to them in a timely fashion as and when those risks evolve.

Tackling this latest challenge head-on is a first-order priority that can’t wait until after the 2025 federal election.

Governments must ensure this issue is given immediate attention from their security agencies. This needs to include an in-depth assessment of the risks, as well as a consideration of future challenges. Partners and allies should share their findings with each other. An example of the type of activity that should be incorporated into such an assessment is Australia’s experience in 2017 and 2018 leading up to its 5G decision, when the Australian Signals Directorate conducted technical evaluation and scenario-planning.

There is also a question of choice, or rather lack of it, that needs deeper reflection from governments when it comes to high-risk vendors. Democratic governments should not allow the commercial sector to offer only one product if that product originates from a high-risk vendor. Yet there are major internet providers in Australia which provide only Chinese TP-Link modems for some internet services, and businesses which only sell Hikvision or Dahua surveillance systems (both Chinese companies were added to the US Entity List in 2019 because of their association with human rights abuses and violations).

Not only do the digital rights of consumers have to be better protected; consumers must also be given genuine choices, including the right to not choose high-risk vendors. This is especially important in selecting vendors that will have access to personal data of citizens or connect to national critical infrastructure. Currently, across many countries, those rights are not being adequately protected.

As smart cars integrate AI systems, consumers deserve a choice on the origin of such systems, especially as censorship and information manipulation will be a feature of some products. Governments must also provide a commitment to their citizens that they are only greenlighting AI systems that have met a high standard of data protection, information integrity and privacy safeguards.

Which brings us back to DeepSeek and other AI models that will soon come out of China. If politicians, government officials, companies and universities around the world are being told they cannot use DeepSeek because such use is too high-risk, governments need to ensure they aren’t then forcing their citizens to take on those same risks, simply because they’ve given consumers no other choice.

Australia needs Australian AI

Australia must do more to shape its artificial intelligence future. The release of DeepSeek is a stark reminder that if Australia does not invest in its own AI solutions, it will remain reliant on foreign technology—technology that may not align with its values and often carries the imprints of its country of origin.

This reliance means that Australian user data and the economic benefits derived from it will continue to flow offshore, subject to foreign legal jurisdictions and foreign corporate priorities.

When people engage with AI chatbot assistant-type services from platforms such as ChatGPT, Gemini, Copilot or DeepSeek—via web interfaces, mobile apps, or application programming interfaces (or APIs)—they are sharing their data with these services as well as receiving AI-generated responses. The market entry of DeepSeek, which stores its data in China and moderates its responses to align with Chinese Communist Party narratives, raises two critical concerns: the exploitation of data for foreign interests and the ability of AI-generated content to shape public discourse.

AI platforms not based in Australia operate under the legal frameworks of their home countries. In the case of DeepSeek, this means compliance with China’s national intelligence laws, which require firms to provide data to the government on request. User inputs including text, audio and uploaded files, and user information such as registration details, unique device identifiers, IP address and even behavioural inputs like keystroke patterns, could be accessed by Chinese authorities. The flow of Australian data into China’s data ecosystem poses a long-term risk that should not be overlooked.

While individual data points may seem insignificant on their own, in aggregate they provide valuable insights that could be leveraged in ways contrary to Australian interests. As a 2024 ASPI report found, the CCP seeks to harvest user data from globally popular Chinese apps, games and online platforms, to ‘gauge the pulse of public opinion’, gain insight into societal trends and preferences, and thereby improve its propaganda.

This may be even more powerful for chatbots, which can collect data for aggregation to understand audience sentiment in particular countries, and also be used as a tool for influence in those countries. AI models are shaped by the priorities of their developers, the datasets they are trained on, and the fine-tuning processes that refine their outputs. This means AI does not just provide information, it can be trained to reinforce particular narratives while omitting others.

Many chatbots include a safety layer to filter harmful content such as instructions for making drugs or weapons. In the case of DeepSeek, this moderation extends to political censorship. The model refuses to discuss politically sensitive topics such as the 1989 Tiananmen Square protests and aligns with official CCP positions on topics such as Taiwan and territorial disputes in the South China Sea. AI-generated narratives influence public perception, which can pose risks to the democratic process and social cohesion, especially as these tools become more commonly embedded in search engines, education and customer service.

Australia’s response should be about having the right safeguards in place to mitigate known risks. It needs to ensure that AI systems used in the country reflect its values, security interests, and regulatory standards. This challenge demands that Australia play an active role in AI development and implement regulatory frameworks that protect against harms and foster domestic innovation.

DeepSeek challenges the idea that only tech giants with massive resources can develop competitive AI models. With a team of just 300, DeepSeek reportedly developed its model for less than US$6 million, far less than the $40 million training cost of OpenAI’s GPT-4, or the $22 million cost for training Mistral’s Mistral Large. While some experts argue this figure may not reflect the full cost—including potential access to restricted advanced processors before US export controls took effect—the broader lesson is clear: significant AI advances are possible without vast financial backing.

DeepSeek has proven that having talent is even more important than having tech giants, which highlights an opportunity for Australia to participate meaningfully in AI development.

To harness its potential, Australia must foster an environment that nurtures homegrown talent and innovation. The announcement last week of the $32 million investment by Australian AI healthtech firm Harrison.ai by the National Reconstruction Fund is a step in the right direction, but investment in a single company is not enough.

Australia needs increased investment in education and research, strengthening existing developer communities—particularly open-source initiatives—supporting commercialisation efforts, and promoting success stories to build momentum. A well-supported AI sector would allow Australia to harness the benefits of AI without attempting to match the spending power of global tech giants. The focus should be on fostering an environment where AI talent can thrive and ethical AI can flourish, ensuring that Australia reaps both the economic and societal benefits.

Without strategic investment in domestic AI capabilities, Australia risks ceding influence over critical technologies that will shape its economy, security and society in the years ahead. The challenge is not just technological—it is strategic. Without decisive action, Australia will remain a passive consumer of AI technologies shaped by foreign priorities and foreign commercial interests, with long-term consequences for democratic integrity, economic security and public trust in AI-driven systems.

Meeting this challenge requires more than just regulatory safeguards; it demands sustained support for a strong domestic tech ecosystem.

The crisis in Western AI is real

The release of the Chinese DeepSeek-R1 large language model, with its impressive capabilities and low development cost, shocked financial markets and led to claims of a ‘Sputnik moment’ in artificial intelligence. But a powerful, innovative Chinese model achieving parity with US products should come as no surprise. It is the predictable result of a major US and Western policy failure, for which the AI industry itself bears much of the blame.

China’s growing AI capabilities were well known to the AI research community, and even to the interested public. After all, Chinese AI researchers and companies have been remarkably open about their progress, publishing papers, open-sourcing their software and speaking with US researchers and journalists. A New York Times article from last July was headlined, ‘China Is Closing the AI Gap with the United States’.

Two factors explain China’s achievement of near parity. First, China has an aggressive, coherent national policy to reach self-sufficiency and technical superiority across the entire digital technology stack, from semiconductor capital equipment and AI processors to hardware products and AI models—and in both commercial and military applications. Second, US (and EU) government policies and industry behavior have exhibited a depressing combination of complacency, incompetence and greed.

It should be obvious that Chinese President Xi Jinping and Russian President Vladimir Putin are no friends of the West and that AI will drive enormously consequential economic and military transformations. Given the stakes involved, maintaining AI leadership within democratic advanced economies justifies, and even demands, an enormous public-private strategic mobilisation on the scale of the Manhattan Project, NATO, various energy-independence efforts, or nuclear-weapons policies. Yet the West is doing the opposite.

In the US, government and academic research in AI are falling behind both China and the private sector. Owing to inadequate funding, neither government agencies nor universities can compete with the salaries and computing facilities offered by the likes of Google, Meta, OpenAI, or their Chinese counterparts. Moreover, US immigration policy toward graduate students and researchers is self-defeating and nonsensical, because it forces highly talented people to leave the country at the end of their studies.

Then there is the US policy on regulating Chinese access to AI-related technology. Export controls have been slow to appear, wholly inadequate, poorly staffed, easily evaded, and under-enforced. Chinese access to US AI technologies through services and licensing agreements has remained nearly unregulated, even when the underlying technologies, such as Nvidia processors, are themselves subject to export controls. The US announced stricter licensing rules just a week before former President Joe Biden left office.

Finally, US policy ignores the fact that AI R&D must be strongly supported, used, and, where necessary, regulated throughout the private sector, the government, and the military. The US still has no AI or IT equivalent of the Department of Energy, the National Institutes of Health, NASA, or the national laboratories that conduct (and tightly control) US nuclear-weapons R&D.

This situation is partly the result of sclerotic government bureaucracies in both the European Union and the US. The EU technology sector is severely overregulated, and the US Departments of Defense and Commerce, among other agencies, need reform.

Here, the tech industry is somewhat justified in criticising their governments. But the industry itself is not blameless: over time, lobbying efforts and revolving-door personnel appointments have weakened the capabilities of critically important public institutions. Many of the problems with US policy reflect the industry’s own resistance or neglect. In critical ways, it has been its own worst enemy, as well as the enemy of the West’s long-term security.

For example, ASML (the Dutch maker of state-of-the-art lithography machines used in chip manufacturing) and the US-based semiconductor-equipment supplier Applied Materials both lobbied to weaken export controls on semiconductor capital equipment, thus assisting China in its effort to displace TSMC, Nvidia and Intel. Not to be outdone, Nvidia designed special chips for the Chinese market that performed just slightly below the threshold set by export restrictions; these were then used to train DeepSeek-R1. And at the level of AI models, Meta and the venture capital firm Andreessen Horowitz have lobbied fiercely to prevent any limits on open-source products.

At least in public, the industry’s line has been: ‘the government is hopeless, but if you leave us alone, everything will be fine’. Yet things are not fine. China has nearly caught up with the US, and it is already ahead of Europe. Moreover, the US government is not hopeless, and must be enlisted to help. Historically, federal and academic research and development compare very favourably with private-sector efforts.

The internet, after all, was pioneered by the US Advanced Research Projects Agency (now DARPA), and the World Wide Web emerged from the European Organisation for Nuclear Research. Netscape co-founder Marc Andreessen created the first web browser at a federally funded supercomputer center within a public university. Meanwhile, private industry gave us online services such as CompuServe, Prodigy and AOL—centralised, closed, mutually incompatible walled gardens that were justly obliterated when the internet was opened to commercial use.

The challenges of AI research and development and China’s rise require a forceful, serious response. Where government capacity falls short, we need to bolster it; not destroy it. We need to pay competitive salaries for government and academic work; modernise US (and EU) technology infrastructure and procedures; create robust research and development capacity within the government, particularly for military applications; strengthen academic research; and implement rational policies for immigration, AI research and development funding, safety testing and export controls.

The one truly difficult policy problem is openness, particularly open-source licensing. We cannot let everyone have access to models optimised for hunter-killer drone attacks; nor, however, can we stamp ‘top secret’ on every model. We need to find a pragmatic middle ground, perhaps relying on national defence research laboratories and carefully crafted export controls for intermediate cases. Above all, we need the AI industry to realise that if we don’t hang together, we will hang separately.