Key Points
- American companies are investing in Chinese semiconductors.
- China is aiming to dominant in microchip manufacturing.
- This is bad for America both economically and from a national security perspective.
Make no mistake: China is out to eat our lunch. The Red Giant is doggedly, aggressively pursuing every opportunity to undermine American sovereignty. The Biden administration is doing little to deter them – but now it looks like some American businesses may actually be helping them.
According to the Wall Street Journal, U.S. venture-capital firms are throwing more and more money into China’s semiconductor businesses, “aiding Beijing’s bid for chip-sector dominance and complicating Washington’s efforts to preserve America’s lead in the critical technology.”
“U.S. venture-capital firms, chip-industry giants and other private investors participated in 58 investment deals in China’s semiconductor industry from 2017 through 2020, more than double the number from the prior four years,” WSJ reports.
“Silicon Valley venture firms Sequoia Capital, Lightspeed Venture Partners, Matrix Partners and Redpoint Ventures have made at least 67 investments in Chinese chip-sector companies since the start of 2020,” WSJ added.
This is a terrible turn for two reasons.
Economically, we’re handing an enemy the keys to a vital industry. Computer chips are in everything – and we’re in the middle of a shortage. This could give China incredible leverage – the U.S. doesn’t want to be in a position of weakness relying on China for chips.
Then, there are the national security concerns.
According to recent Drill Down reporting, many agencies, including the FBI and the Secret Service, have made drone purchases from Shenzhen-based company DJI. The DHS believes with ‘moderate confidence’ that DJI provides American infrastructure and law enforcement data to the Chinese government.
So why are we letting them hold (make) all the chips? Why are American venture-capital firms fueling this rise to dominance? How can they not see the danger?
According to former Pentagon Tech Chief Nicolas Chaillan, America is already losing the cyber war. “We have no competing fighting chance against China in 15 to 20 years,” says Chaillan, who quit the Defense Department in September. “Right now, it’s already a done deal; it is already over in my opinion.”
China has proven to be dangerous (don’t forget the state-sponsored Microsoft Exchange server hack!) and now they have the pole position when it comes to semiconductor production.
We’re essentially paying them to hack us and steal our private information.
If that’s not bad policy, I don’t know what is.
