Race for the future: Is America In Danger of Losing Its Crown To China?

By Hugh Cuppage

Over the past four years, the world has begun to experience the so-called ‘Fourth Industrial Revolution’ (McKinsey, 2022). This technological revolution is taking place across multiple sectors simultaneously, in energy, automation, artificial intelligence and drone warfare. In this competition, it is becoming clear that China is outpacing the US in taking full advantage of these new sectors (ITIF, 2024). Whilst China innovates out of necessity, America is falling behind, complacent and beholden to interest groups hostile to development. This is alarming because these technologies threaten to completely upend the paradigm upon which much of industry, energy production and warfare are organised.

For example, China is carrying out a comprehensive shift to renewables that substantially increases its energy security. It now produces more than half of global renewable energy (The Guardian, 2023), and is aiming to expand its nuclear power sector with a new ‘fourth generation’ reactor coming online last year (ITIF, 2024). This is technology the US does not have and has stalled by throttling its nuclear industry. China once imported 90% of its oil from overseas, largely from the Middle East (EIA, 2024). This oil was transported through the Strait of Malacca (ISMWorld, 2023). In a conflict over Taiwan, the US Navy would undoubtedly blockade the Strait, threatening China’s existence as an industrialised power (ISMWorld, 2023). Its revolution in renewable energy avoids this by building self-sufficiency and occurs alongside robust growth in coal power, of which the nation has a reliable domestic supply (Carbon Brief, 2024). 

In addition, China is rapidly racing ahead in embracing automation. This is another area in which the U.S. remains painfully behind, as shown by last week’s threatened port strike (Reuters, 2024). In the context of worsening demographics, maximising the potential of automation becomes a necessity (Acemoglu, 2021). China has already made dramatic progress, with multiple ‘lights out’ factories operating with little to no personnel (SCMP, 2024), and even fully automated road construction (Global Construction Review, 2021). If these trends continue, their impact could be truly revolutionary. In the military sector, automation has the potential to increasingly disconnect a nation’s industrial potential from its demographics. An increasingly automated military industry could churn out huge numbers of drones, UAVs and munitions with little respite and minimal human involvement (BAE Systems, 2020). In previous conflicts, major wars tended to be won by the side with the larger populations and industrial potential (Kennedy, 1987). In the future, wars will likely still be won by the nation with the larger industrial potential, but not necessarily the numerically largest human workforce. Rather, it will be the one that makes maximum use of all available factors of production, including the workers released by automation back into the labour pool (Noah Smith, 2024).

Despite this, America remains ahead in key areas, especially in the field of drone warfare and artificial intelligence. This has radically reshaped the nature of war, with 20th-century technologies like tanks, large warships and massed infantry assaults increasingly obsolete (New York Times, 2024), which has turned the battlefield into a web of precision-directed munitions (New York Times, 2024). At present, America is helping Ukraine to introduce A.I. to its drone fleet, allowing it to operate autonomously and negate enemy jamming (Radio Free Europe, 2024). It is also drawing on these experiences to help prepare similar defences for Taiwan, including drone swarms and anti-drone laser weapons like the British Dragonfire and Israeli Iron Beam (UK Defence Journal, 2024). Leading American companies in the field, like Anduril, are also substantially more innovative and dynamic than anything China or Russia currently possess (Defense News, 2024).

Thus, whilst China currently holds the advantage due to a higher degree of state capacity, the United States could begin to catch up if it more effectively leveraged its more open society for innovation (Law and Liberty, 2023). Over the coming decade, the world will likely pass the event horizon of this new technological revolution. Likely, whichever power can claim the holy grail of effective artificial intelligence, near full automation of industries and increasingly cheap and unlimited clean energy will be in a strong position to ‘win the future’ (Foreign Policy, 2024) and dominate the foundations of global/geopolitical power in the 21st century.

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