Chip Wars: Survival and Breakthrough

I almost finished reading Chris Miller’s “Chip Wars” in one go; it is excellently written, clear and concise, giving a sense of seamless flow. After closing the book, I reflected on the past and present of the chip industry and gained a different understanding of the current geopolitical landscape and competitive dynamics.“Latecomer Advantage” or “Latecomer Disadvantage”David Ricardo proposed the theory of “comparative advantage,” which is both simple and powerful. Since the reform and opening up, China has relied on the theory of comparative advantage to achieve a leap from an agricultural country to an industrial one. However, as it continues to ascend along the industrial and value chains, reaching the very foundation of developed countries, the resistance encountered is predictable; it can be said that “how can one sleep peacefully beside the bed of another?” The tide of the digital economy is rolling in, with data, computing power, and algorithms being its three most important elements. Computing power is closely related to chip design and manufacturing capabilities. A small chip carries significant weight, concerning the fate of the nation and the ruling party. The title “Chip Wars” is indeed very appropriate. In the face of American attacks, should we choose to confront head-on and fight to the end, or should we avoid the sharp edge and secretly find alternative routes? I believe it depends on whether we have a retreat. The independent research and development of chips is an unavoidable path. If so, we can compromise tactically but must remain steadfast strategically in our pursuit of autonomy. If there are other alternatives, while confronting directly, can we also invest more energy and quietly explore other technological routes?Say Goodbye to “Hiding One’s Talents”Akio Morita and Shintaro Ishihara co-authored “Japan Can Say ‘No'” in the 1980s, arguing that the American model lacked competitiveness and envisioned the Japanese escaping control through chips. This prophecy ignited a sense of national pride among the Japanese but also severely provoked the Americans. If this continues, will Uncle Sam become a mere bystander? This cannot happen; you can live well, but you cannot live better than me, and you certainly cannot develop a sense of disloyalty. Thus, there was a shock across the political spectrum, with unprecedented unity in the political and industrial sectors, leading to measures such as exchange rate controls and import-export restrictions against Japan, curbing Japan’s path to chip industry hegemony, and indirectly aiding the development of the chip industries in South Korea and Taiwan, forming the current layout of chip design, equipment, and manufacturing. If the relationship between master and servant is such, how much more so in the struggle for global dominance? The restrictions and suppression of China’s chip industry by the United States will only intensify; fantasies are futile.Looking back to before China’s accession to the WTO in 2001, the U.S. allowed China to ride on its coattails, but it was by no means a free lunch; there was a realist logic behind it. At that time, forced technology transfer was a common strategy among many developing countries and did not violate GATT and WTO rules. Japan’s rapid rise after the war greatly benefited from forced technology transfer from foreign capital. However, in the Market Access Agreement signed in November 1999, the U.S. exploited our eagerness to join the WTO, forcing China to accept many harsh terms, including some that exceeded WTO rules, the most important of which was the deprivation of China’s economic sovereignty to impose technology transfer requirements on foreign capital, restricting China’s ability for independent development.Bound by the unequal division of labor and status among nations at that time, whether out of necessity or strategic deviation, we viewed our relationship with the U.S. as the top priority in foreign policy, fantasizing about receiving aid similar to the Marshall Plan from the U.S. Because we adopted an export-oriented strategy, in order to stabilize exports to the U.S., we tried hard to cater diplomatically, avoiding the use of veto power on the UN stage, and even sacrificing necessary resistance.The U.S. allowed us to ride on its coattails and enjoy the miracle of export-oriented growth, but economically, it required China to sacrifice its independent development. The development of events exceeded the expectations of both the Chinese and the Americans, with many factors involved, which can be discussed further. The result is that we no longer have the space to hide our talents. The boxing match has reached the finals, the kind where life and death are at stake.History has its own laws, showing inevitability in certain aspects. However, history will not simply repeat itself; even the slightest differences or small crevices can represent the lives of countless individuals. The chip war is raging, the tariff war is rampant, and the financial war is thrilling. The vast majority of us, including ordinary citizens, will be deeply affected, but we can only watch from the sidelines. For personal essentials, I believe we still need to recognize the general trend, perceive scarcity, take care of our health, and plan our actions carefully.

Leave a Comment