Chip making in China canceled

[Joe in PNG]

Keith Alexander called the effects of Chinese espionage "The greatest transfer of wealth in history", at that was in 2012. It will take several decades for China to develop a domestic capacity, but they have the raw data and the talent, it's just a matter of if their economy / system can hold out long enough.

If they do manage to catch up, that'll be... problematic.

I'd postulate that nations under tyrannical governments have a hard time actually innovating and must turn to espionage to try and keep up.
There's a lot of reasons for this.
-Pseudoscientific fads like Lysenkoism held by leadership becomes dogma by decree, and that hurts research.
-Corruption and nepotism putting unqualified people into research positions
-Funds for pure research are held back, as those are needed for only what's immediately practical.
-Potemkin Projects taking up much time and effort. Especially in education.
-Scientific talent holding beliefs against the official party line and are purged.

And on it goes.

[Chance]

I'd postulate that nations under tyrannical governments have a hard time actually innovating and must turn to espionage to try and keep up.

From The Wall Street Journal:

The U.S.’s pre-eminence among the world’s top research universities continues to diminish, according to a new global ranking, while mainland Chinese universities are on the rise, producing a greater quantity and higher quality of research than ever before.

....

“The data is very clear: America can no longer take for granted its decadeslong dominance of world higher education and research, and it is China that is leading the challenge,” said Phil Baty, the rankings editor. “If current trends remained the same, we would see China overtaking the U.S. in the coming years.”

The number of Chinese scholarly publications has been growing steadily since the mid-1990s, but as recently as this year it was widely believed in the Western academic community that the quality of Chinese scholarship still lagged behind Western nations.

Then a paper published this spring in the journal Scientometrics, which studies the quantitative features and characteristics of science and scientific research, found that China has overtaken the U.S. as the world leader in scientific research output of “high impact” studies.

Trying to rank research is its own conversation, but China has demonstrated enormous advances in the past twenty years. I've seen this in my own field: look at stuff that was coming out of Chinese universities circa 2000 and it was a joke. By the time I finished school in 2016, their best universities were easily on par with schools in the US.

The valedictorian of my class went to a Sino-Swedish graduate program. According to him, the faculty at the Chinese university was high quality, though the students weren't great at the time - that was 2010-ish.

Look at the computer science faculty of pretty much any public university in the US - where do they come from? Now imagine all the students we trained and sent back.

Their talent pool spectacular and their government is pushing them to do better. They can absolutely catch up if they hold out long enough.

[mizer67]

There are still a hell of a lot of chips that use DUV vs. EUV. Most. Frankly, 98% of our high-end military gear is using chips >10 nanometers (nm) using DUV or other legacy lithography methods.

This move is more impactful because of the US persons language than any hardware considerations. However, China's still pilfering top-talent from other regions (including Taiwan) w/4X (or more) the typical salaries for the position. And TSMC, Intel, etc. are still building chips in China that can be used in military applications and this change will not prevent that in the near future, even when the US Persons leave. Although yes, it's sure to have some impact.

My worry with this next shot in the economic war between the US and China is that it's an impetus to take things kinetic in the next 10 years, before the Chinese ability to keep pace is significantly degraded. I imagine they'll redouble the domestic efforts and funding to keep pace, but if that effort fails or flags, the risk is non-zero this move (still) goes south or pushes up the timeframe of things going south.

[Joe in PNG]

Trying to rank research is its own conversation, but China has demonstrated enormous advances in the past twenty years. I've seen this in my own field: look at stuff that was coming out of Chinese universities circa 2000 and it was a joke. By the time I finished school in 2016, their best universities were easily on par with schools in the US.
The valedictorian of my class went to a Sino-Swedish graduate program. According to him, the faculty at the Chinese university was high quality, though the students weren't great at the time - that was 2010-ish.
Look at the computer science faculty of pretty much any public university in the US - where do they come from? Now imagine all the students we trained and sent back.
Their talent pool spectacular and their government is pushing them to do better. They can absolutely catch up if they hold out long enough.

If their government continues to go down the Neo-Maoist road, they can and will easily throw all that away. And they're already reversing a lot of the gains made during the years since Deng.

What good is a well-educated talent pool if they end up getting shot for holding counter-Revolutionary ideas? What good is a high-quality university during a new Cultural Revolution?

Nazi Germany had a pretty good brain drain in the short time it was around (maybe rejecting 'Jewish' physics wasn't that good of an idea), and the Soviet Union also.

[Caballoflaco]

This move is more impactful because of the US persons language than any hardware considerations. However, China's still pilfering top-talent from other regions (including Taiwan) w/4X (or more) the typical salaries for the position. And TSMC, Intel, etc. are still building chips in China that can be used in military applications and this change will not prevent that in the near future, even when the US Persons leave. Although yes, it's sure to have some impact.

They aren’t afraid to spend money to buy expertise. And I imagine in many places they can sweeten the deal by making sure peoples families either in China or abroad don’t disappear.

https://www.nytimes.com/2022/10/17/w...ry-pilots.html

LONDON — China has recruited as many as 30 retired British military pilots, including some who flew sophisticated fighter jets, to train pilots in the People’s Liberation Army, according to Britain’s Defense Ministry. A senior official said the ministry worried that the practice could threaten British national security.

Britain said it was working with allies to try to stop the practice, which the official said dated to before the coronavirus pandemic but had gained momentum in recent months. The recruited British pilots, the senior official said, included former members of the Royal Air Force and other branches of the armed forces.

None of the retired pilots are suspected of violating the Official Secrets Act, the British law that covers espionage, sabotage and other crimes. But the official said that Britain was determined to tighten the controls on retired service members to guard against training activities that could contravene espionage laws.

“We are taking decisive steps to stop Chinese recruitment schemes attempting to head hunt serving and former U.K. Armed Forces pilots to train People’s Liberation Army personnel in the People’s Republic of China,” said a spokesman for the Defense Ministry, who, under department rules, spoke on the condition that he not be named.
Britain, however, does not have obvious legal tools to stop retired pilots from accepting training contracts from the Chinese army. The contracts are lucrative — about $270,000 a year — and are particularly attractive to pilots who retired from active duty several years ago, the official said.

China, the official said, has contracted the recruiting to a third party, a private test flying academy in South Africa.

The British official declined to say which allies had been involved in investigating the practice, but he suggested that their pilots had also been targets for recruitment.

None of the pilots recruited by the Chinese operated the F-35, the most advanced and expensive fighter jet in the British fleet. But several have flown older-generation warplanes like the Typhoon, Harrier, Jaguar and Tornado, according to the official. Though the pilots train their Chinese counterparts on Chinese planes, he said, the Chinese were eager to learn about British and Western tactics and procedures.

[Totem Polar]

Likely both.

The amount of industrial espionage conducted by China is just astounding. You can't build a country on ripping off everyone else's R&D and ignoring patents and not expect there to be some consequences at some point.

Likewise, decoupling is really important. If they stopped letting their students study abroad here (or were unable to due to economic downturn), they would single handedly crash the American higher education industry overnight....and that's the real reason we keep issuing visas to Chinese students regardless of the vast majority of them conducting industrial espionage. Usually visa issuance can be leveraged as a foreign policy tool, but we shot ourselves in the foot with the CCP on that.

Man… there is a lot I could say about #1 intellectual property, and #2 the influx of Chinese students in higher ed. But I won’t, on an open forum.

[Paul Blackburn]

So who's going to make the chips?

[JHC]

So who's going to make the chips?

I think Taiwan and Singapore make vastly more chips than China does for the global market. I thought this sanction was more about the technology needed to manufacture advanced chips and much/most/all of that technology is purchased from American manufacturers. That is, while we don't make a lot of chips (yet) we make most/all of the related tech needed to manufacture and service said advanced chip manufacturing. I'm very fuzzy about exactly what that American tech actually is.

But from the OP's link:
"The Bureau of Industry and Security (BIS) announced new extraterritorial limits on the export to China of advanced semiconductors, chip-making equipment, and supercomputer components."

And that is how China gets stiffed. That's how I read it explained somewhere last week.

[Chance]

If their government continues to go down the Neo-Maoist road, they can and will easily throw all that away.

I don't agree. If China wants to become a super-power, they're going to need to need tech for themselves, as well as to dangle in front of potential allies. They have a demonstrated ability to wrangle tech for their own purpose - i.e., TikTok - and it's not like they're going to stop stealing technology.

[RoyGBiv]

I don't agree. If China wants to become a super-power, they're going to need to need tech for themselves, as well as to dangle in front of potential allies. They have a demonstrated ability to wrangle tech for their own purpose - i.e., TikTok - and it's not like they're going to stop stealing technology.

I think you and Joe are talking past each other. Seems to me you are both correct.... China needs the tech and has the money to throw at it.... but... The academic talent to develop it will certainly be suppressed, at least to some degree, by the party-line required to participate in the development. If you have to threaten someone's family to get them motivated, what results you do get will likely be slower and less stellar.

Proof?

After several decades of pursuing fab tech, by stealing it, demanding transfer (corporate blackmail) and internal development, this is the position they find themselves in today. Way behind the curve.

Innovating TikTok is a different skill set than innovating silicon fab. China is already most excellent at social engineering, with a captive user base.