As progress surges in 5G connectivity, not far behind arise concerns over national security and economic security.
Throw in advances in artificial intelligence, the Internet of Things, automated vehicles and “smart” medical devices, and similar questions come up.
Who’s winning these technological contests? The United States or China? What if the United States doesn’t win?
Securing private property rights will make the difference.
Property rights give individuals and businesses room to innovate. They’re bolstered by free enterprise and the ability to enforce one’s property rights through the rule of law and due process. Strong property rights have made America the global leader in innovation.
Our rules-based system coupled with secure, enforceable property rights has moved America from a fledgling agrarian startup nation to an industrial and economic powerhouse. The kind of innovation that made America owes much success to our patent system — a property rights securing and enforcing system.
That is, our unique IP system, exclusive rights to one’s inventions, and our societal structure that provides freedom to operate along with the means to hold bad actors accountable. This could be innovators enforcing patents against infringers, suppliers enforcing contracts against implementers, or domestic firms blocking rivals’ IP-infringing knockoffs.
Innovation is America’s competitive edge. “Technological innovation is a mainstay of the American economy,” President Ronald Reagan’s Commission on Industrial Competitiveness said. “It is the foundation of our economic prosperity, our national security, and our competitiveness in world markets.”
Reagan recognized that property rights-based innovation stimulates the creation of new industries and revitalizes mature industry sectors. He also valued the broader benefits to our country.
The National Institute of Standards and Technology, in its Return on Investment Initiative green paper, says, “In combination with the rapid, foundational advances in technology, innovation has never been more critical to U.S. economic competitiveness and national security than it is today.”
This isn’t a new tenet for America’s flourishing and protecting her sovereignty. It boils down to assuring exclusive rights over one’s IP, both at home and in other countries.
In the 1980s, the United States faced similar challenges from Japan as China poses today. Stealing U.S. firms’ intellectual property, forcing technology transfer and joint ventures with domestic companies, manipulating currency, deliberately imbalanced trade — Japan did it to great economic advantage in the 1980s and 1990s just as China does now.
Japan presented a threat to U.S. industrial competitiveness and national security because new economic activity from innovation underwrites America’s robust national security capability. Japanese companies ripped off cutting-edge U.S. technology, and their government manipulated Japanese currency.
The Reagan administration dealt with these threats, while American innovators kept out-inventing the rest of the world.
China presents a more significant hazard to both U.S. economic and national security. China forces American innovators to turn over sensitive IP in forced pairings with Chinese “partner” firms — some of them government-owned, most government-subsidized, all government-dependent and therefore responsive to do the Communist government’s bidding.
Next-generation wireless communication illustrates what’s at stake if American technology from Qualcomm doesn’t prevail in global 5G technology.
At the administration’s urging, essential allies such as Britain, Germany, Poland and Australia are newly scrutinizing privacy and security vulnerabilities, should Chinese technology dominate 5G infrastructure and wireless devices.
The 5G standard will rely on extremely sophisticated patented technology, developed by the handful of companies willing to make huge upfront investments in cellular R&D. Today, two companies are leading the race in foundational 5G technologies — Qualcomm, a private American company whose R&D is funded by its patent licensing business, and Huawei, backed by Communist China.
Crucially, Trump last winter took the Committee on Investment in the United States’ counsel and blocked a Chinese-connected takeover of Qualcomm, based on critical national security reasons. This U.S. firm is known to the U.S. intelligence and security community for its trustworthiness, strong commitment to research and development, and superior technological prowess.
What’s at stake is leadership in a transformative 5G ecosystem that will transfer unfathomable amounts of data far faster, more reliably and cheaper, and enable an always connected “Internet of Things” that will revolutionize every known industry sector and create a springboard for yet-to-be-imagined business models and services.
The economic potential of 5G is extraordinary, as are the national security implications of ceding leadership to China.
If everything’s connected, then everything’s potentially vulnerable. The wrong hands can compel spying on our government and industry, hacking private data and stealing state or corporate secrets.
Innovation is America’s competitive edge, and the fruits of our innovation ensure U.S. economic and national security, so we must do two things. One, we must strengthen property rights, aggressively enabling inventive people and companies to benefit from their R&D and exclusive rights.
Two, our government must back American innovators who seek to exercise their IP rights at home and abroad — especially against foreign competitors that enjoy unfair advantages from governments that will expect their national favorites to lie, cheat, steal and spy in return for the subsidies and other “investments” they’ve provided them.
James Edwards is executive director of Conservatives for Property Rights (@4PropertyRights) and patent policy advisor to Eagle Forum Education & Legal Defense Fund.
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