How America Can Shore Up Asian Order
A Strategy for Restoring Balance and Legitimacy
At the outset of the digital age, democracies seemed ascendant. The United States and like-minded countries were at the cutting edge of technological development. Policymakers were pointing to the inherently liberalizing effect of the Internet, which seemed a threat to dictators everywhere. The United States’ technological advantage made its military more potent, its economy more prosperous, and its democracy, at least in theory, more vibrant.
Since then, autocratic states have caught up. China is at the forefront, no longer a mere rising power in technology and now an American peer. In multiple areas—including facial and voice recognition, 5G technology, digital payments, quantum communications, and the commercial drone market—it has surpassed the United States. Leaders in Cuba, Iran, North Korea, Russia, Venezuela, and elsewhere are increasingly using technology for illiberal ends, following China’s example. And despite the United States’ remaining advantage in some technologies, such as artificial intelligence (AI) and semiconductor production, it has fallen behind China in formulating an overall strategy for their use.
Almost in parallel, the United States and its allies have stepped away from their tradition of collaboration. Instead of working together on issues of common interest, they have been pulled apart by diverging national interests and have responded incoherently to autocratic states’ co-optation of new technologies. Although officials in most democratic capitals now acknowledge the profound ways in which new technologies are shaping the world, they remain strangely disconnected from one another when it comes to managing them. Coordination, when it occurs, is sporadic, reactive, and ad hoc.
The liberal democracies are running out of time to get their act together: whoever shapes the use of emerging technologies such as AI, quantum computing, biotechnology, and next-generation telecommunications will have an economic, military, and political advantage for decades to come. But the world’s advanced democracies have something the autocracies don’t: a long history of multilateral cooperation for the benefit of all.
Because the issues are so diverse, what’s needed now is not more piecemeal solutions but an overarching forum in which like-minded countries can come together to hammer out joint responses. This new grouping of leading “techno-democracies”—call it the T-12, given the logical list of members—would help democracies regain the initiative in global technology competition. It would allow them to promote their preferred norms and values around the use of emerging technologies and preserve their competitive advantage in key areas. Above all, it would help coordinate a unified response to a chief threat to the global order.
Washington has struggled to develop a coherent vision to guide its global technological role, but many autocracies have not. China, in particular, has recognized that the existing rules of the international order were largely written in a predigital age and that it has an opportunity to write fresh ones. Already, Beijing is pursuing this goal by quickly building top-notch capabilities and deploying them throughout the global market, especially in areas where the U.S. presence is weak or virtually nonexistent. In Zimbabwe, for instance, the Chinese AI company CloudWalk is helping develop a national facial recognition system, giving the local government a powerful new tool for political control.
But forward-looking efforts such as these are not solely unilateral. China, Russia, and other autocracies are already coordinating around a self-interested global vision. They are shaping standards for the use of new technologies in exclusive groups such as the Shanghai Cooperation Organization, whose members have agreed to collaborate on information security, robotics, and e-commerce, among other areas. They also work through global forums such as the International Telecommunication Union, where some of the same countries have supported international standards that facilitate unaccountable surveillance. Unlike many liberal democracies, quite a few autocracies have realized that technology, including the power to innovate, set norms for its use, and shape the institutions that decide how it will be employed, is not simply a niche functional issue buried in a crowded foreign policy agenda; it is a central element of modern geopolitical competition.
The United States, on the other hand, has been mostly reactive. China’s rapid progress in 5G, AI, and quantum communications has stumped multiple U.S. administrations. Washington has no easy answer to China’s so-called Digital Silk Road, an array of technological infrastructure projects to accompany the construction projects of its Belt and Road Initiative, nor does it have an answer to the country’s campaign to establish a digital currency. The United States and its allies have consistently struggled to define the rules of engagement around cyberattacks and have responded inadequately to the use of technologies by autocracies to oppress their people. U.S. officials often complain about Beijing’s dominance in technical standard setting and allies’ deferential attitude toward Chinese infrastructure. But they have had a difficult time changing the nature of the game.
The T-12 would help democracies regain the initiative in global technology competition.
This is a multinational failure. Liberal democracies around the world simply do not work together on many of the issues that should unite them. Their responses to autocracies’ abuse of technology tend to be fragmented. National interests diverge, disagreements among states arise, and nothing gets done. Within countries, paralysis often occurs as domestic authorities clash with their national security counterparts over how to deal with election meddling, disinformation, and hacking. Instead of pursuing broad collaboration, the liberal democracies have come up with a patchwork of discrete responses: Canada and France’s collaboration on an expert panel tasked with monitoring developments in AI policy, for example, or NATO’s pursuit of a cyber-deterrence doctrine.
The dispute over the Chinese telecommunications giant Huawei’s 5G capabilities is perhaps the best example of democracies’ inconsistent response. Following Australia’s initial lead, the United States took a hard line against the company, banning Huawei components from its national 5G network and forbidding U.S. entities from doing business of any sort with it. The United States proceeded to insist that other democracies follow suit, even threatening to withhold critical intelligence from allies if they adopted Huawei products. Still, Washington remains relatively isolated in its opposition. Many governments continue to resist U.S. pressure, pointing out that there is no low-cost, one-stop-shop alternative to Huawei’s technology. Even Canada and South Korea, close U.S. allies, have defied Washington and are considering Huawei equipment for their 5G infrastructure.
The democracies have come up with a similarly disjointed response to Russia’s election meddling. Although the Kremlin has interfered in the elections of multiple countries, the problem has largely been treated as a national one, deserving of only a unilateral response from any given target. When Russia interfered in the 2016 U.S. presidential election, only the United States responded with punitive measures. Likewise, Russia’s reported meddling in this year’s U.S. presidential election has so far not produced any unified reaction. Compare that to the response to Russia’s annexation of Crimea and its poisoning of a former intelligence officer and his daughter in the United Kingdom. In those cases, the major democracies coordinated a joint response, imposing new sanctions and expelling Russian diplomats.
Although the democracies currently suffer from a deficit of cooperation, their capacity to work together endures. Here, history offers useful guidance. In 1973, U.S. Treasury Secretary George Shultz convened the finance ministers of France, the United Kingdom, and West Germany in the White House library for informal talks. This “Library Group” quickly added Japan to become the G-5 and later included first Italy and then Canada to become the G-7. In the decades that followed, this informal group of advanced liberal democracies, which for 16 years included Russia as the G-8, would emerge as a powerful international force. Among other issues, the group coordinated its members’ responses to 9/11 and to the 2008 global financial crisis.
Just as the G-7 came to guide multilateral action among the world’s leading economies, a set of techno-democracies—countries with top technology sectors, advanced economies, and a commitment to liberal democracy—must take action on contemporary digital issues. So far, these leading states have acted independently, but their combined market power and national strength would make them a potent unified force.
For now, 12 countries stand out for inclusion in such a group. The United States is arguably still the world’s leading technological power, and France, Germany, Japan, and the United Kingdom all have large economies and impressive technology sectors. Australia, Canada, and South Korea have smaller economies, but they are also important players in technology. The same is true of Finland and Sweden, which are telecommunications and engineering powerhouses. India and Israel are also logical candidates for membership, owing to the global reach of their flourishing technology and startup sectors.
Given the deep need for coordination among like-minded states, this “T-12” group of techno-democracies would fill a yawning gap in modern technological and geopolitical competition. The T-12’s members would undoubtedly disagree on many issues, but the group could provide a critical venue for them to air their grievances. The United States, in particular, should welcome the participation of others, since their presence at the negotiating table would not only improve its digital advantage but also reduce the sense among these countries that they are merely pawns, rather than partners, in a U.S.-Chinese superpower competition.
The most logical structure for the T-12 is an informal group of states, not a secretariat-laden international organization or an alliance with a mutual defense agreement. Although critics often dismiss gatherings such as the G-20 and the Asia-Pacific Economic Cooperation as once-a-year opportunities for heads of state to gather for a few hours, don an ethnically unique shirt, jawbone, and take a group photo, this is a misleading stereotype. Such groupings have in fact been highly effective at marshaling multilateral action.
In the wake of 9/11, for instance, G-8 summits produced specific commitments to prevent a repeat attack. It is thanks to the actions taken then that modern commercial aircraft have hardened cockpit doors, major international ports screen cargo containers for dangerous materials, and nations restrict the export of portable surface-to-air missiles. The G-8 was also at the forefront of public health efforts. In 2001, the group established the Global Fund to Fight AIDS, Tuberculosis and Malaria, which has saved millions of lives through investments in research and global health programs. And after the 2008 financial crisis, the G-20 committed to a $5 trillion stimulus package and proposed new financial regulations, helping contain the subsequent recession’s damage and prevent another crash.
The government leaders or ministers who meet as the T-12 would also have a unique opportunity to enlist the private sector and international organizations in their work. Annual meetings could serve as an arena for business leaders to join government officials in coordinating responses to emerging issues such as the need to improve remote-learning technology in response to the COVID-19 pandemic and what the future of counterterrorism might look like. The format for these meetings could include issue-based sessions, in which governments invite leading private-sector figures for focused discussions, or standing forums akin to the Asia-Pacific Economic Cooperation’s Business Advisory Council, which provides advice to Pacific Rim leaders on concerns facing businesses throughout the region. The T-12 could also develop working groups and committees on the multistakeholder model, which brings together representatives from business, civil society, government, and research institutions. These groups would then pass recommendations up to ministers and principals. Simultaneously, leaders could collaborate with other multilateral organizations—working with NATO on AI security, for instance, or with the Organization for Economic Cooperation and Development on the industrial implications of disruptive technologies.
The success of the T-12 will inevitably hinge on its ability to translate its conceptual appeal into the nuts and bolts of executing a real agenda. One task its members could start with is information sharing. Within the T-12, governments could update one another on the security of supply chains, particularly in critical sectors such as semiconductors, where China aims to dramatically reduce the portion of the market currently controlled by American, Dutch, and Japanese firms. They could conduct audits of supply chains that cross international boundaries, especially those that include Chinese-made components or software. Members could compare their assessments of the risks of China’s 5G technology, examine advances in quantum computing, investigate AI safety, and share strategies for preventing the theft of intellectual property. In a more ambitious step, they could exchange information about online propaganda, disinformation, the integrity of academic research, and specific ways in which autocratic regimes employ technology to erode liberal democracy.
Setting standards for the use of emerging technologies would be another crucial job for the T-12. The countries and companies producing the most advanced technology have a valuable first-mover advantage: they can set guidelines for how they expect their products to be used. Facial recognition software would be a good test case for the T-12’s potential on this front. This technology is already being used for surveillance purposes, including by the Chinese government to monitor Uighur Muslims in Xinjiang and by Moscow to link photographs with social media accounts. The leading democracies have yet to agree on rules for using facial recognition technology, including its proper role in the criminal justice system, or the protocols that should govern data collection. The T-12 could address this by exploring how such technology could be used to secure large events or assist in law enforcement investigations, but not as a means of social control or mass intimidation.
Autocracies have realized that technology is a central element of modern geopolitical competition.
Beyond helping the democracies get on the same page as they compete with China, the T-12 could also serve as a way for members to air differences within the group itself. Europeans might object, for instance, to the fact that Israel’s NSO Group, a controversial technology firm known for its spyware products, sells smartphone surveillance tools to autocracies, and the Americans may disagree with the EU’s focus on privacy when it infringes on free expression. The democracies have varied approaches to data protection, privacy, and free speech. The T-12 would allow them to explore these differences, with the ultimate aim of establishing broad principles, understanding disagreements, and narrowing the gaps between participants.
Coordinating investments would represent another natural function of the T-12. Members could rationalize their allocation of resources to innovation and R & D and to securing supply chains. They could even make concrete financial commitments to counter China’s Digital Silk Road and 5G capabilities and launch joint projects in such areas as quantum computing, cybersecurity, and tools for detecting AI-generated counterfeit images or videos known as “deepfakes.” In the realm of more speculative technologies, it could examine advances in 3-D printing, potentially unbreakable encryption methods based on quantum mechanics, and microscopic sensing technology. More ambitious still, it might launch a joint fund to extend loans and loan guarantees to developing nations that seek trusted 5G equipment and other technology that accords with liberal values.
Finally, the T-12 could serve as a forum for coordinating policy. Members might harmonize their export controls on cyber-surveillance tools; regulate the use of blockchain, a digital ledger of global transactions, to ensure the integrity of supply chains when it comes to sectors such as defense manufacturing and medical equipment; generate common standards for a variety of 3-D printing methods; and even coordinate their education and immigration policies to develop and retain top technology talent. More broadly, the T-12 should articulate a vision of the future based on innovation, freedom, democratic collaboration, and liberal values.
Over time, the T-12 could expand and transform, just as the G-5 became the G-7 and then, temporarily, the G-8. Starting with the initial 12, the T-12 should aim for around 20 members within five years. Additional individual European states, such as Italy and the Netherlands, could be asked to join, without the complexity of including the European Union itself as a member. In Latin America, Brazil and Chile would make obvious candidates, and in Africa, members could include Kenya, Nigeria, and South Africa. Taiwan would also be a useful participant, even if creative diplomacy might be required to deal with the island’s nonstate status.
The T-12’s agenda should similarly grow in ambition. Moving beyond its initial objectives, the group could branch out into securing the supply chains for semiconductors. Doing so would involve multilateral export controls on semiconductor manufacturing equipment and technology, an area in which the techno-democracies have a significant lead over China and others. As part of this effort, they could create an international chip fabrication consortium to move semiconductor production out of China and into a T-12 country and provide shared financing for the billions of dollars such a move would require. And as the world faces diminishing returns in the growth of computing power due to the physical limits of existing materials, the group could launch joint R & D projects devoted to a new generation of microelectronics that might jump-start an increase in computing power again.
Technology is too important to be left to the technologists.
As its portfolio grows, the T-12 should also take a multinational approach to 5G networks. The current telecommunications equipment sector is a Huawei-dominated oligopoly. This presents a major supply chain and security risk, yet China’s state subsidies make it difficult for others to enter the market. The T-12 could support non-Huawei companies, such as Ericsson, Nokia, and Samsung, as they transition to using an open radio access network, or O-RAN, which relies on open interfaces rather than proprietary equipment. This would allow multiple vendors to supply the market with interchangeable telecommunications components. In the future, it could collaborate on 6G alternatives to Chinese hardware well before they are necessary, helping avoid the very dilemma many economies are now facing with 5G.
The T-12 could also develop the framework for a digital currency that preserves the central role of the U.S. dollar in the global financial system. That role is under threat. China’s central bank is already piloting a digital currency program. If the effort succeeds, China is likely to extend its use to countries that participate in its Belt and Road Initiative, expanding the renminbi’s reach as an international medium of exchange and possibly threatening the dollar’s preeminent status. Pursuing a secure digital dollar-based platform would level this playing field, making it faster and easier to accomplish tasks such as moving money between banks, trading oil futures, and tracking money laundering.
Beyond this, the T-12’s members could develop and adopt a cyber-deterrence doctrine. The world faces a perpetual threat from cyberattacks, given the low barriers to entry and the difficulty of attributing an attack to a defined actor. To tackle the threat, the T-12 could lay out uniform standards for appropriate behavior in cyberspace and define what constitutes a proportionate response to a cyberattack. Members could cooperate in detecting and measuring attacks by increasing information sharing and establishing early warning mechanisms, then work together to attribute violations to a particular aggressor. And once a culprit is identified, the T-12 could coordinate a joint response.
Objections to a T-12 are easy to imagine. The most obvious would be general opposition to any new international grouping, which would join a raft of existing multilateral organizations, some of which are obsolete. Yet the T-12’s novelty is what makes it relevant. There is no group of advanced democracies to coordinate technology policy: the G-7 leaves out important technology leaders, and the G-20 includes the illiberal states of China, Russia, Saudi Arabia, and Turkey. NATO is a military alliance focused first and foremost on European security. The Organization for Economic Cooperation and Development, with 37 member states, is too large and lacks the track record to break ground on technological issues. The T-12, by contrast, would bring together the right members while elevating technology to a level commensurate with such issues as European security and global economic policy.
The private sector’s role in a potential T-12 raises another question: Why would any business participate in a government-driven process? The answer is that it would make economic sense. Consider the inevitable restructuring and geographic diversification of supply chains that will almost certainly follow the coronavirus pandemic. Already, governments and firms are considering reshoring pharmaceutical and medical device production, and firms that are facing factory shutdowns due to the pandemic are rediscovering the merits of diverse supply chains. Multilateral coordination among national governments would make this process less disruptive, costly, and lengthy than it would otherwise be.
Then there is the likely reaction of China and Russia. Wouldn’t a new group of techno-democracies merely provoke them? Indeed, they probably would treat it as a threat, but the cost of forgoing cooperation among liberal democracies is far higher than the consequences of any pushback. As the COVID-19 pandemic has proved, when liberal democracies fail to work together, whether, in this case, in harmonizing travel restrictions, employing disease-mitigation measures, or assisting poorer nations, China benefits. The T-12 should not ignore illiberal states, and it can try to work with them on issues such as AI safety or technological responses to climate change. But it should tread carefully and limit their involvement. Ultimately, the world will be safer, more stable, and freer if liberal democracies stick together.
A final objection would be based on realism. Cooperation in other fields—global health, say, or economic policy—is hard enough, and the likelihood of building a successful body focused on technological collaboration may be low. Indeed, one should not overstate the degree of like-mindedness among any group of sovereign states, democracies or not. But that is a reason to experiment with new structures to deal with tough problems, rather than rely on either outdated mechanisms or an every-country-for-itself approach. The status quo is not sustainable. If the democracies fail to act, technology will help shift the balance of economic, military, and political power in favor of autocracies.
In July 1944, delegates of the Allied countries came together in New Hampshire for what became known as the Bretton Woods conference. After discussions of various technical issues and sweeping foreign policy debates, the conference produced a blueprint for governing the postwar international monetary and financial order. The Allies agreed on a system of fixed but adjustable exchange rates, laid the groundwork for the International Monetary Fund and the World Bank, and embraced an open international economic system. The framework designed then largely remains in place today.
Some of the most pressing technological issues facing the world’s democracies now may ultimately rival in importance the economic issues considered by the Bretton Woods delegates. Just as in 1944, when the United States and like-minded countries recognized that they could no longer make economic policy in a vacuum, today they must recognize that the time has passed when they can deal with the profound effects of technology on their own. For too long, national approaches to technological questions have been ad hoc, poorly coordinated, and left to technology experts to sort out. But in today’s competitive global environment, technology is too important to be left to the technologists.
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