Congressional report advocates inching when miles are needed to curb China AI

The U.S. government should change how it uses sanctions to curb Chinese aggression, according to a House of Representatives committee.

Policies should target problematic industry sectors with blacklists along with organizations that endanger populations internal to China and external, states a report by a select committee on competition about American venture capital and the Chinese Communist Party.

For all practical purposes, the report is a call for the U.S. government to end all private-sector investment in foreign biometrics and other forms of AI.

More specific, the government needs to stop venture capital firms aiding in any way the development of technologies that are used to threaten U.S. dominance in strategic technology or to oppress minority populations in China. Among facial recognition providers, the report notes GGV’s investment in Megvii, Sequoia Capital China backing Yitu, and Qualcomm Ventures funding of SenseTime.

Of course, not only is this a rearguard, and thus capitulatory, policy, it’s supposed to leave a mark on 30 years of U.S. government policy designed to entice domestic businesses to send their manufacturing and jobs to China.

In 66 pages, the report doesn’t mention outsourcing or offshoring once, the reason for this mess. There is symmetry in the document, though, in that it doesn’t offer a novel response, either.

After 66 pages, the authors of the report offer just two recommendations.

First, the U.S. should write laws that bar U.S. investment in blacklisted Chinese companies. The existing laws intended to stop U.S. investment in companies attached to the People’s Liberation Army have done little to change the status quo except to spur China to catch up to the West’s technology base faster than most thought possible.

Second: Target specific industry sectors, not just industry giants.

No word on how to do that. Given how intertwined the two economies are and the number of small businesses fueling China’s growth, the effort might be like swinging at molecules with a flyswatter.

Something has to be done, of course. De-incentivizing venture investment, a theme in this report, is essential, but not in this kind of seat-of-the-pants, reactionary way.

But if someone is passing around 66-page reports about how China is an industrial and military threat (and it is), that report should have ideas for disentangling the economies while leaving research to thrive.

It should have ideas for creating incentives to bring industries back to the U.S. AI, robotics and metal printing could provide something China cannot: almost real-time, small-lot and greener goods. That would be finally delivering on the promise of IT: mass customization.

But the House should go ahead and make VCs the doulas (with doomsday dens in their mansions) of the electronic technology. It’ll keep them away from the controls of the nation.

Article Topics

biometrics  |  China  |  facial recognition  |  investment  |  Megvii  |  SenseTime  |  U.S. Government  |  Yitu Technology