During the VP first debate for the 2012 election was the first time I was hearing about the systematic counterfeit system that China has been operating within the U.S. markets. Then again, during the state of the Union address, President Obama warned the American people of the risk of foreign enemies attempting to breach security on many major channels like the power grid, financial institutions, and air traffic control (http://www.nytimes.com/2013/03/04/us/us-weighs-risks-and-motives-of-hacking-by-china-or-iran.html?pagewanted=all.). Finally, in the upcoming years private investors businesses, namely technology firms, have begun to report statistical user data that supports high amounts of technology product theft by China from the U.S.
While the exact reasons for China’s breaches’ and theft of intellectual property and technology have taken a forefront in many political conversations. Specifically, how the increased gravity of the theft has adversely affected the U.S. economy, and has aided the Chinese economy.
For a brief summary from one of our national intelligence direction James clapper see the link below. James clapper remarks on the magnitude of the issue at hand with China hacking U.S. the ".plundering of our intellectual technology, they seem most interested in our technology, if they can save time and expense of doing r&d on their own and…steal it from us, it works to their benefit.” When asked what industries were most affected director clapper answered, “technology,” and all others, calling it, “carte blanche.”
While President Obama mentionaed security breaches to major secure networks affecting the security of major U.S. interests (energy, financial, defense), the private sector’s fortune 500 companies are worried fro their companies financial health, and trade secrets.
The next link was found in the Washington post, where the article, “Sequester to hit Chinese hackers hard,” written by Joel Archenbach remarks on Congresses new push to crack down on Chinese Hackers. Archenbach says, “…and that the sequester is not only going to put countless Americans out of work, but will also sideline many thousands and possibly millions of Chinese hackers. If you haven’t been following the news you may not realize that the largest industry in China is the hacking of American computer networks.”
While many places in both the U.S. and Chinese economy will be effected by trade, it is hard to yet know to what degree.
I think it will be interesting to see how this plays out in not just the economic realm but the political realm as well.
ReplyDeleteIntelectual property has been discussed in the Doha round of WTO negotiations. It will be interesting to see how the decision of the doha round will affect this issue. The US has had increasing trade relations with China. If this issue continues to increase some industries that have been heavily affected may use less trade as a deterrent for intellectual theft. I also agree with the previous comment and am curious how this will affect political relations between the US and China.
ReplyDeleteAnother wildly interesting thing China is doing is building ghost cities. Essentially they are building large cities that no one lives in or no one can afford. Seemingly they are doing this to keep their current GDP growth. 60 minutes covered it.
ReplyDeletehttp://www.businessinsider.com/60-minutes-chinas-ghost-cities-2013-3
It will be interesting to see what happens when all of these shady techniques China is using come crashing down. With the way they value their currency, the ghost cities, and this new article saying that have become "professional" because they take weekends off..
http://www.huffingtonpost.com/2013/02/25/chinese-hackers_n_2756914.html
it's looking like a lot of China's success may be artificial.
No free lunch - China will get what they deserve! They are creating a lot of "bad IPE karma"!
ReplyDeleteJust thought this might add to the issue....interesting update on the Chinese economy from an article on the economist:
ReplyDeletehttp://www.economist.com/news/china/21576426-chinas-disappointing-new-growth-figures-are-not-end-world-climbing-stretching-and