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China and Artificial Intelligence: The Cold

War We’re Not Fighting
by Arthur Herman
26–32 minutes

The public and the media are right to worry about a future dominated by artificial
intelligence. But the threat is not coming from Silicon Valley, Big Tech, or the Deep State.
It’s coming from Beijing, and much more than the runaway development both of artificial
intelligence and machine learning (ML) is at stake. The fate of societies and economies
founded on Western liberal principles hangs in the balance—a future that Beijing and the
Chinese Communist Party want to replace with their own totalitarian template. And that even
includes a new definition of what it is to be human.

While Americans worry about whether AI and ChatGPT will enable students to cheat on their
term papers or generate deep-fake videos of President Biden or Donald Trump, China has
been steadily moving ahead with its own plan for this advanced digital technology. While the
AI industry in this country remains focused on commercial advantage and market share and is
diffused and dispersed throughout more than 67,000 companies large and small, China’s
efforts in AI are centralized and regimented and entirely focused on a larger agenda.

Americans have had some exposure to China’s ruthless use of new technologies from human-
rights advocates who detail how they are being used to oppress China’s Muslim Uighur
minority. One of the reasons for alarm at the effectiveness of the Chinese-owned TikTok is
that its algorithm owes its speed and effectiveness to AI, while TikTok’s data-gathering can
provide valuable grist for the Chinese government’s AI mills.

China’s recent announcement about mass-producing humanoid robots by 2025 also raised
alarms, since these are devices that will be largely driven by AI.

Thus, even as anti-AI activists in the U.S.—among them some of the technology’s original
innovators—were calling for a moratorium on research a year ago, China was paving the way
toward an AI-dominated future none of us wants. For the past seven years, China has been
moving ahead with its plans to become the world’s AI superpower. This includes building the
next high-tech industrial revolution for victory on the battlefield and creating a total
surveillance multiverse.

China is ramping up AI investment, research, and entrepreneurship on a historic scale. Its

generative AI spending is set to reach 33 percent of the world’s AI investment by 2027, up
from 4.6 percent in 2022. Those investments will probably reach $13 billion by then,
according to a new report from research firm IDC.

Money for AI start-ups is pouring in from Chinese venture capitalists, tech juggernauts, and
the Chinese government. Chinese students have become adept at AI, enrolling in advanced-
degree programs and streaming lectures from international researchers on their smartphones.
Start-up founders are furiously pivoting, reengineering, or simply rebranding their companies
to catch the AI wave.

We’ve never faced an opponent like this, with the will and the means to transform the world
into what it wants. The Soviets tried it during certain phases of the Cold War, but they never
had the scientific, technological, or economic means to carry it out.

China does. Indeed, what is happening to the Uighurs is just the first bitter sip from the cup
that Beijing and President Xi have in store for the rest of us.

Yet without understanding the larger context, and the origins of China’s obsession with AI as
a means of social and political control and of remaking the world in China’s image, the true
extent of the threat remains opaque—and our ability to respond constrained.

_____________

On May 25, 2017, the world changed. That was the day a boardgame-playing AI Google
product called AlphaGo AI defeated Chinese champion Ke Jie in the national game of go.
AlphaGo had scored its first high-profile victory in March 2016 during a five-game series
against the legendary Korean player Lee Sedol, winning four to one. While barely noticed by
most Americans, the five games drew more than 280 million Chinese viewers. Overnight,
China was seized by AI fever. The buzz didn’t quite rival America’s reaction to Sputnik, but
it lit a fire under the Chinese technology community that has been burning ever since.

The government in Beijing took no chances when AlphaGo came to play Ke Jei. Media
coverage was banned—China did not want to risk the national humiliation of having its
champion lose to Google’s DeepMind division in real time. So most Chinese viewers were
not allowed to watch the match live. Beijing even went as far as issuing a censorship notice to
broadcasters and online publishers, warning them against livestreaming the match, according
to China Digital Times. The notice said, “Regarding the go match between Ke Jie and
AlphaGo, no website, without exception, may carry a livestream.”

But on May 25, AlphaGo didn’t just beat Ke Jie—it systematically humiliated him. During
three matches lasting more than three hours each, Ke tried every approach he could think of:
conservative, aggressive, defensive, even wildly unpredictable. Nothing worked. AlphaGo
seemed to anticipate his every move, as it slowly squeezed him out of the picture.

For Chinese observers, the moment was galvanizing, and the government mobilized the
nation to dominate this new technology. Instead of being intimidated, China’s Communist
Party leadership saw the future not as something to fear but something to seize. And not even
two months after Ke Jie resigned his last game to AlphaGo, the Chinese central government
released its New Generation Artificial Intelligence Development Plan.

It called for greater funding, policy support, and national coordination for AI development. It
also set clear benchmarks for progress by 2020 and 2025 and projected that by 2030 China
would become the center of global innovation in artificial intelligence—leading in theory,
technology, and application.
Already in 2017, investors had responded to that call, pouring record sums into artificial-
intelligence start-ups and making up 48 percent of all AI venture funding globally, surpassing
the United States for the first time.

President Xi has set aside $150 billion in government funding to make China the first AI-
driven nation, which includes building a massive police-surveillance apparatus powered by
Big Data and artificial intelligence. At the same time, the Chinese military has been seeing its
future in an AI battlefield.

Jin Zhuanglong, head of the Ministry of Industry and Information Technology, said in a
January 2024 interview that the government has four major targets this year: 1) Accelerate
the transformation and upgrading of traditional industries; 2) consolidate and improve the
leading position of advantageous industries; 3) actively foster emerging industries and
industries of the future, and 4) promote new industrialization enabled by artificial
intelligence.

These all have military applications. The Chinese are working toward fully automated
shipyards, both for shipbuilding and unloading cargo. And AI is already being helpful in
warship design. Military marine architects used an artificial-intelligence app to design the
electrical layout of a warship, and they did it with unprecedented speed and accuracy. It took
the AI designer roughly a day to complete work that would normally take a human team a
year, according to the South China Morning Post.

Hudson Institute scholar Koichiro Takagi sees the Chinese military’s interest in AI research
and applications centering on four main areas (bearing in mind that under Chinese law,
anything that private companies develop in AI automatically belongs to the People’s
Liberation Army).

One area is the autonomy of unmanned weapons, including the development of drone
swarms, about which more later.

The second is processing large amounts of information through machine learning. For
example, the People’s Liberation Army (PLA) is building a network of unmanned weapons
and undersea sensors in the waters surrounding China to gather data it can analyze with
AI/ML.

The third is using AI to speed up military decision-making, including what’s called “strategic
reasoning.” AI can sift through multiple options for actions on multiple fronts and domains to
arrive at an optimal solution—something that would take a human-led council of war hours,
even days, to achieve.

Fourth is the military’s interest in cognitive warfare, or actively influencing the brain and
neurological systems of their human opponents, to shape the enemy’s will to fight or subdue
an opponent without a fight. (The most science-fictional of the four, it is the one about which
we have reason to be skeptical, at least for the present.)

But probably the most striking and notorious developments within the Chinese AI monolith
today are AI’s applications for the total surveillance state.

_____________
China is building a burgeoning panopticon with more than 500 million surveillance cameras
deployed nationwide as of 2021—which accounts for more than half of the world’s
surveillance cameras.

As analyst Paul Scharre has noted in the Los Angeles Times, Beijing is pouring billions of
dollars into projects such as the Skynet and Sharp Eyes surveillance networks and its “social
credit system”—scoring ordinary people and rewarding them for their fidelity to the rules.
This gives the central government a much larger role in China’s AI industry than the role
Washington plays in the industry here.

China now requires that train passengers show national IDs to buy tickets, which allows the
government to block human-rights activists or anti-corruption journalists from traveling. In
Xinjiang Province, home of China’s oppressed Uighurs, the government uses AI-sifted Big
Data and facial recognition to scrutinize anyone entering a mosque or even a shopping mall,
thanks to the thousands of checkpoints requiring a national ID check-in.

China’s use of AI in human-rights abuses has been glaring in the case of ethnic Uighurs in
Xinjiang, who are subjected to tools such as face, voice, and even gait recognition. Under the
Strike Hard Campaign, the Chinese Communist Party has built thousands of police
checkpoints across Xinjiang and deployed 160,000 cameras in the capital, Urumqi. Facial-
recognition scanners are set up at hotels, banks, shopping malls, and gas stations. Movement
throughout the province is tightly controlled through ID checkpoints that include face, iris,
and body scanners. Police match the obtained data against a massive biometric database
consisting of fingerprints, blood samples, voice prints, iris scans, facial images, and DNA.

Even more significant than the use of this technology to control and repress the Uighur
minority is the data collected, which AI companies can use to further train and refine their
algorithms.

Some groups—PBS, Electronic Frontier Foundation, and the Center for Strategic and
International Studies—have suggested that China is using Xinjiang as a testing ground for its
advanced facial-recognition software and alert systems. This software, which can be covertly
positioned in traffic lights and elsewhere, collects biometric data in real time as people walk
through the streets and go about their day. It tracks people and deposits information into a
comprehensive database to identify a person by name, address, and other state records. This
surveillance has been used to restrict the free movement of people, particularly Muslims, by
quartering them to their homes or specific parts of an area, like a neighborhood.

As the Center for International Human Rights reported in October 2022: “The use of AI has
not been limited to external forms of surveillance like security cameras. The Uighurs and
other groups have also been forced to download apps to their phone that help law
enforcement to monitor online behaviors. For example, the apps search through text messages
and internet searches for mentions of Quran verses or donations to a mosque, and even
staying off social media can raise suspicions. Such acts can result in an indefinite holding at a
detention center.”

Human Rights Watch (HRW) was able to discover and reverse engineer one of the apps that
police in Xinjiang use for surveillance. Called IJOP or Integrated Joint Operations Platform,
it includes among its functions geo-location and mapping, information searches using
personal data, facial-recognition features, and Wi-Fi detecting. HRW’s findings indicate that
the wide collection of data, ranging from DNA samples to the color of a vehicle, has been
used to set up alerts for foreign nationals and people found to exhibit such behaviors as
spending time abroad, having certain types of content on their phone, or simply using large
amounts of electricity.

Once the app’s algorithm identifies such behavior, it then triggers an alert to law enforcement
that prompts an investigation. This feeds directly into an AI-driven system called the
Supreme Court Information Center that oversees application of Chinese law in specific cases
across the country.

About six years ago, the project was little more than a database. No longer. Now it has
become a rule of the Supreme Court that judges follow the advice of the AI system and, if
they do not follow it, provide a written justification that is included in the case documents.

According to the Supreme Court, the system learns from 100,000 cases every day and
monitors them for possible wrong decisions or corruption. In addition to court records, the
system is said to have access to the databases of police, prosecutors, and government
agencies.

For example, the AI is expected to help enforce sentences “by finding and seizing the
property of a convict almost instantly and putting it up for online auction.” Combined with
China’s social-credit system, it can deny debtors access to transportation, hotels, or other
social services, and enforce the ban.

“The smart court SoS (system of systems) now connects to the desk of every working judge
across the country,” said Xu Jianfeng, director of the Supreme Court Information Center. For
the central government, this ensures that all law cases in China conform to its ideological
direction. For those unfortunate enough to be caught in its grip, it means no judge or law-
enforcement official dares exercise his or her independent judgment in adjudicating a case.

_____________

As noted above, the Chinese military sees much bigger game in its uses of AI. The Ministry
of National Defense has established two major institutions, the Artificial Intelligence
Research Centre and the Unmanned Systems Research Centre, that are focused on AI and
unmanned-systems research and development.

The PLA’s most important military think tank, the Academy of Military Science, has also
updated its doctrine to cope with AI technological development. Its job is driving defense
innovation and ensuring that the war-fighting theory and doctrine of the PLA take full
advantage of disruptive technologies such as AI as well as autonomous systems.

As already noted, papers that have been published so far by PLA senior officials and
strategists show that the PLA is seeking to use artificial intelligence in four main areas. One
is the autonomy of unmanned weapons, including the development of swarms of numerous
drones. China aims to conduct highly autonomous integrated operations with a variety of
unmanned systems and unmanned weapons. In addition, the PLA is rapidly expanding its use
of unmanned weapons, first entering the airspace south of Taiwan’s Air Defense
Identification Zone in September 2022, with the number of intrusions increasing to a total of
70 by December of that year.
Among all the AI technologies, China places the top priority on unmanned combat systems
and equipment, along with other advanced military innovations. As the war in Ukraine has
demonstrated, unmanned technology has been rapidly changing the face of warfare: Some
have even dubbed it the most recent revolution in military affairs, akin to the advent of
gunpowder. Unmanned equipment is also one of the first options that military leaders are
looking to for future combat equipment.

Since President Xi took office, he has emphasized the importance of unmanned systems for
China’s future dominance. In 2020, when he met students at the Chinese People’s Liberation
Army Air Force Aviation University, Xi declared, “Drones are profoundly changing war
scenarios. It is necessary to strengthen drone-combat research, education and training, and
accelerate the training of drone pilots and commanders.”

The revolution brought by unmanned systems expands exponentially with AI and machine-
learning applications, especially when military operations and strategy depend more and
more on the gathering and interpretation of information, at which AI and unmanned systems
excel.

Moreover, under civilian-military fusion rules, communication and coordination regarding AI

innovation resources are the norm among scientific-research institutes, universities,
enterprises, and military-industry units. New joint laboratories are also being stood up to
enhance collaboration between civilian institutes and the military establishment.

For example, North China University of Technology and the equipment departments of the
PLA’s army, navy, and rocket force founded the Military-Civil Fusion Intelligent Equipment
Research Institute. Tsinghua University has its Military-Civil Fusion National Defense Peak
Technologies Laboratory. Meanwhile, the Chinese military is helping itself to a smorgasbord
of the latest AI-enabled products from private companies. To take just one example, the
PLA’s surveillance and image-processing systems are reinforced by intelligent security
monitors produced by Hikvision.

The second area of PLA interest in AI is in pro-cessing large amounts of information through
machine learning. As of this date, the PLA is building a network of unmanned weapons and
undersea sensors in the waters surrounding China, using AI to process the information
obtained from this network. As Hudson’s Takagi notes, “The PLA is considering a new form
of electronic warfare that uses artificial intelligence to analyze received radio waves and to
optimize jamming.”

The third area is accelerating the decision-mak-ing process on and off the battlefield by
employing AI. There is considerable debate, even in China, regarding the perils of handing
over key aspects of decision-making to “smart” machines. For example, those in Chinese
military circles worry about using artificial intelligence for decision-making in nuclear
strategy, which might precipitate a nuclear confrontation faster than human reflection and
judgement can process, or stop.

For now, however, experts agree that the PLA will likely stick to AI for processing masses of
information and data, and guiding drones and other autonomous weapons, not complex
decision-making. As China’s confidence in the capabilities of AI grows, however, it is likely
that more and more decision-making will be passed along to AI support systems, including
within its Rocket Force, which oversees China’s nuclear arsenal.
_____________

“In 2005, the U.S. State Department publicly stated the U.S. assessment that China also
operates an offensive biological weapons program, specifically identifying two Chinese
entities as likely involved, one of which is the Fifth Institute,” a U.S. intelligence report
released by the House Intelligence Committee stated, as quoted by the Indo-Pacific Centre for
Strategic Communications. “In a 2006 declaration of compliance with the Biological and
Toxic Weapons Convention, China acknowledged that the Fifth Institute specifically
researches SARS coronaviruses.”

The report also mentioned the book The Unnatural Origin of SARS and New Species of
Artificial Humanized Viruses as Genetic Weapons, which was published by Chinese military
experts in 2015, and which describes how to create weaponized viruses for use by the
military.

The revelations about the PLA’s keen interest in weaponizing viruses sheds an ugly and
sinister light on the current debate about the origins of the Covid virus. And not only that.
The government’s and military’s fascination with biotech and their interest in AI/ML are
converging.

For example, also in 2015, then-president of the Academy of Military Medical Sciences He
Fuchu insisted that biotechnology will become the new “strategic commanding heights” of
national defense. Since then, Fuchu has become vice president of the Academy of Military
Sciences, which leads China’s military science enterprise.

Zhang Shibo, a retired general and former president of the National Defense University, has
named biology as one of seven “new domains of warfare.” In the wake of Covid and the
possibility that the virus in the Wuhan lab was being developed for biowarfare purposes,
these matters need to be taken very seriously.

In all these cases, AI applications can be useful for not only identifying but manipulating and
attacking an entire category of persons or groups through targeted viruses and diseases. This
is because, at the most basic biological level, DNA itself is nothing more than data—data that
can be exploited using AI and machine learning.

In that sense, the combination of China’s earlier interest in biotech and its obsession with
advancing artificial intelligence may allow China’s military and intelligence services to
develop comprehensive digital profiles of specific individuals, nations, and races—a form of
high-tech racial profiling that a Himmler or a Mengele might have only dreamed about. By
targeting specific weaknesses within a population’s genomic makeup, it might be possible to
develop weapons that could harm a specific subpopulation or race.

Even more frightening, scientists at the Suzhou Institute of Biomedical Engineering and
Technology are using mouse embryos to develop ways to provide key growth information to
an AI caretaker, which can then rank the embryos in terms of overall health and genetic
potential—enabling researchers to manipulate the growth of embryos to achieve optimal
results. In short, the Chinese vision of AI includes a new paradigm for genetic engineering,
conducting eugenics on a massive high-tech scale.

_____________
The key question is: What can the United States do to confront this nightmarish threat?

Advocates for international standards for the technical and ethical development of AI had
hoped that international, multilateral, scientific, and standard-setting bodies could somehow
restrain China’s voracious AI appetite. In their 2022 book The Age of AI, the late Henry
Kissinger and former Google CEO Eric Schmidt argued for similar international constraints
on the growth of AI for not only China but also the United States—comparing the race for AI
supremacy to the race for nuclear weapons in the Cold War.

China’s surge in AI research and deployment since then has made those hopes seem even
more illusory than they were in 2022. Indeed, China has been increasingly active in those
same international standard-setting bodies. In 2019, leaked documents from the UN
telecommunication union’s standards process—which directly affects 193 member states—
revealed how China was setting the norms for rules governing facial-recognition applications
that would only facilitate Chinese-style norms of surveillance, e.g., ones that could be used
for malicious profiling by the PLA or other Chinese agencies.

Meanwhile, Stanford University’s AI Index, which assesses AI advancements worldwide

across various metrics in research, development, and the economy, ranks China among the
top three countries for global AI activity. On AI research, for example, China produced about
one-third of AI journal papers and AI citations worldwide in 2021. In economic investment,
China accounted for nearly one-fifth of global private-investment funding in 2021, attracting
$17 billion for AI start-ups. Tencent, Huawei, and Alibaba are already among the top 10
global companies in AI, as a recent Nikkei study showed.

Some in the U.S., including the authors of the most recent McKinsey report on AI
investment, have concluded that “there is tremendous opportunity for AI growth in new
sectors in China, including some where innovation and R&D spending have traditionally
lagged global counterparts: automotive, transportation, and logistics; manufacturing;
enterprise software; and healthcare and life sciences” (my emphasis). Overall, McKinsey has
seen “clusters of use cases” in which AI can create upwards of $600 billion annually in
economic value for China—that’s roughly equal to the city of Shanghai’s entire contribution
to China’s GDP.

While some, including U.S. allies, may see these clusters as investment opportunities, more
alert observers should recognize that all of China’s AI research and development is aimed at
one goal: advancing China’s global hegemony. This includes enabling other, similar regimes
to survey and control their own citizens. As David Yang, a professor of economics at
Harvard, notes, “Autocratic governments would like to be able to predict the whereabouts,
thoughts, and behaviors of citizens. And AI is fundamentally a technology for prediction.”

Yang’s research shows China exporting huge amounts of AI technology, amounting to much
more than its contributions to other frontier-technology sectors such as quantum or even
unmanned systems. “To the extent that [Chinese] technology is exported,” Yang concluded,
“it could generate a spreading of similar autocratic regimes to the rest of the world.”

And so an intentional pause on American AI development would “absolutely” give China an

advantage, as Sultan Meghji, a professor at Duke University’s Pratt Engineering School, said
in a recent interview with Newsweek. China is “investing massive amounts of money in AI,
we are already to a degree struggling to keep up,” Meghji said. “This is one of the biggest
competitions in technology right now and we should be accelerating our investments in AI.”

Still, the U.S. is currently the global leader in AI technology, especially in innovation and
cross-cutting applications. Yet while commercial AI expands exponentially, the U.S.
government has to deal with the technology through the prism of government funding and
directed research. Our government operates in an environment that is the opposite of civilian-
military fusion. Tech companies proficient in AI/ML have to be coaxed, not coerced, into
supporting government or Pentagon uses of AI. In fact, private companies can still exercise
veto power over participating in specific government programs, as happened when Google
employees refused to participate in a defense project to develop facial-recognition software to
identify terrorists. Google had to back out of the project.

This is all the more reason why the United States needs to develop an overall AI strategy that
aims not just at countering China’s moves in AI but advancing American AI supremacy.

Which nation wins this struggle will ultimately depend on which one has the clearest idea of
what it’s doing, and where it’s going. The Chinese clearly do, and theirs is a vision that is
more frightening, and potentially more catastrophic for human freedom, than anything
dreamed up by science fiction.

Of course, there are unknown risks with AI, as with any disruptive technology. It’s also clear
that, unlike the Chinese, Americans still don’t know where we are going with AI, or
specifically how to get there—at least not yet. But the time to figure out the answers, and to
set a course for achieving them, is growing short.

Photo: Sergei Guneyev, Sputnik, Kremlin Pool Photo via AP, File

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