US-China war, is Biden’s Chips Act working?
The effects of the US Chips Act on Chinese technological development have so far been very limited and have mostly generated a cost and not a performance problem. Costs that the Chinese technological giants seem able to absorb. Cesare Alemanni's in-depth analysis for Stefano Feltri's blog Appunti
If you haven't lived on Mars in recent months, you already know: the age of artificial intelligence (AI) has officially begun.
To tell the truth, it began seventy years ago, however it is only with the advent of chatbots such as Chat-GPT and generative AIs such as Midjourney that artificial intelligence has become a truly familiar theme to large audiences.
Not a day goes by without discussing the extraordinary potential and/or catastrophic implications of this technology. Between prophecies of apocalypse (total or "only" social) and mirages of an "end of work", artificial intelligences were one of the main topics of the two-year period 22/23.
There is, however… a but .
AI discourses, especially those in perspective, treat the issue as if it were magic. As if it did not depend on concrete contingencies and on the continuity of a given development trajectory. Which, however, is by no means guaranteed, for technical as well as political reasons.
Artificial intelligences are in fact one of the fields on which the match between the United States and China for “ domination of the 21st century ” has been played for some years now. So much so that we are now talking about the "AI race", with the same tones with which we spoke of the "arms race" during the Cold War.
If it really is a race, the first to break away from the blocks was China, six years ago. In July 2017, the Chinese government released a document entitled "Development plan for next generation AI".
With it, China set itself the goal of becoming the leading power in the field of AI by 2030. Within the "plan", AI was defined as "a national priority" and as such in recent years it has effects, been treated. As a result, China currently "produces" nearly half a million AI engineers a year, and is the number one country in the world for the support and quality of academic research in the field.
The development of Chinese AI has been favored by the fact that Beijing can afford to treat users' privacy and their data (of which AIs are notoriously ravenous) in a much more casual way than other countries. To the point that the renunciation of the privacy of 1.4 billion people – also in the name of the rapid technical development of AI – has been presented, without any mincing words, by the government of Xi Jinping as a matter of national interest.
Over the past two years, these advances have caused considerable alarm in the United States. Also because the implications of AI certainly do not stop at the civil sphere but promise to have enormous repercussions on the military too.
Suffice it to say that, in theory, a sufficiently advanced AI could devise an atomic aggression strategy that does not end with the self-destruction of both sides. Making it, at least in theory, "possible" to win an atomic war.
THE AMERICAN ANSWER
With a level of "dirigisme" unprecedented in recent decades, in the late summer of 2022, the US countermove materialized in the now infamous CHIPS and Science Act. With it, the Biden administration vetoed the export in China of the latest generation chips and the tools for their manufacture. Within the CHIPS Act, particular attention was paid to the most powerful and microscopic logic chips (in the order of less than 5 nanometres. To understand: the diameter of a human hair is approximately 80,000 nanometres).
These nanochips perform highly specialized functions and are fundamental in the logic acceleration process on which the functioning of generative AIs is based. These are, without a doubt, the most advanced technological objects that human beings are capable of mass-producing today.
However, given the extremely intricate and complex composition of the industrial supply chains on which their production depends, today these chips are often designed and engineered by American companies but physically they can be produced in very few and very sophisticated factories, equipped with exorbitantly expensive machinery and over-qualified personnel with extremely expensive training.
Problem: Almost none of these factories are located in the US. And indeed, the most important of them, called TSMC, is located in Taiwan, or in the country that more than any other is today at the center of China's expansionist ambitions. Also, if not really, due to the presence of TSMC.
As a result of the CHIPS and Science Act, state-of-the-art nanochip manufacturers will no longer be able to sell their most advanced products in China.
However, they will be able to continue to sell chips slightly more "backward" in the evolution of the species.
In fact, the principle behind the Biden move is not to completely stop, but rather to slow down, Chinese technological evolution to ensure that it always remains one step behind the American one (we find here the principles of that doctrine of containment that I mentioned on Macro a few weeks ago).
The paradox is that the very chips that Biden would like to keep out of China are, as mentioned, actually produced on his doorstep, in Taiwan.
The indirect effect of the CHIPS Act will therefore be to increase pressure on the island and, with it, the Chinese temptation to invade it.
In this regard, the leaders of TSMC have already declared that, in the event of a Chinese attack, they are ready to destroy their priceless factories. It would be a colossal damage not only for Taiwan but for the global economy (an estimated trillion dollars of deadweight loss per year) and would lead to a sharp slowdown in the development of the entire AI economy.
If a possible destruction of TSMC represents the most concrete "danger" for the future development of AI (at least among those linked to the Sino-American dispute) there are also other more indirect and subtle ones.
As highlighted by a recent intervention by AI Now , an excellent think tank on artificial intelligence issues, one of the risks of an "AI race" between superpowers is that it ends up justifying the overriding of regulations aimed at controlling development as much as possible harmonious, sustainable and ethical development of these technologies with potentially devastating social effects. As stated in the text of the article:
“It is evident that, in the United States, the so-called “AI race” against China has not only fueled an appetite, which goes beyond party divisions, for greater support for the development and implementation of AI, but it has also helped counter calls for slower, more policed development and stronger regulation. This rhetoric […] has grown in influence and is being used increasingly deliberately in policies supporting the interests of major technology corporations.'
There is therefore the concrete possibility that, in order to win the race for AI, the United States and potentially also Europe (which is, at the moment, third and quite late in this race), decide to review their standards of supervision and regulation of the downward trend of the AI sector, thus following China in a spiral that subordinates the ultimate goal of the technology as a "power project" to any consideration of its impact.
CHINA DOES IT BY ITSELF
Finally, the last "risk" is that the CHIPS Act will obtain the opposite effect to that hoped for. Instead of depressing the development of Chinese AI, it runs the risk of providing incentives for the growth of a more robust and self-sufficient Chinese technology industry, including on the chip side. After all, the strengthening of what one wanted to weaken is a historically rather frequent side effect of "protectionist" policies.
Recently, one effect has already achieved this. It is news of a few days that China has decided to put gallium and germane exports under control, metals that are an essential part of the chip supply chain.
An act that evidently smacks of retaliation and testifies to an increasingly hostile climate around chips and, therefore, by extension, around AI.
The development of this scenario is difficult to predict at the moment, also because "importing" factories such as those of TSMC is, according to some, a Sisyphean effort compared to the speed at which chip evolution travels.
And yet, according to recent analyses, the effects of the CHIPS Act on Chinese technological development have so far been very limited and have mostly generated a cost and not a performance problem.
Costs that the Chinese technological giants seem able to absorb. Especially given that behind them there is a government which, as mentioned, has never made a secret of wanting to reach 2030 as the world leader in AI.
(Excerpt from the blog Notes )
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/guerra-usa-cina-sta-funzionando-il-chips-act-di-biden/ on Sun, 09 Jul 2023 06:20:39 +0000.