(Interviewer: Satoshi Nishihata)

 

The UK government banned Huawei’s 5G network. France looks ready to follow the UK. What should we do to get many other countries included in this united front toward China? The Liberty Magazine spoke with the architect of the Trump administration’s National Security Strategy.

 

Can Freedom Based on Democracy Be Maintained?

― If China takes over the leadership currently held by the United States and it becomes a superpower, how do you think the whole world would change? Do you think we can keep the present form of democracy based on freedom?

Spalding: No, I don’t think so. Because, for instance, China is the most powerful country in the world. Then China will have the ability to coerce other countries, and especially, other businesses to follow their interests. So rather than upholding the four freedoms: freedom of speech and freedom of religion and freedom from fear and freedom from want. In fact, they will try to suppress those, because they’re concerned that their own people might somehow learn about these ideas.

 

Chinese Influence in the U.S.: Using U.S. Principles and Values against It

― You mentioned that many institutions in the United States are in league with the Chinese Communist Party. For example, last year the NBA came close to firing a general manager over a tweet supporting protesters in Hong Kong. This might be a symbolic example of Chinese influence in the United States. Could you tell us how the Chinese Communist Party has strengthened its control over the United States?

Spalding: It is strengthening its control over the U.S. by using the openness of the U.S. against it. And that is by creating financial incentives for those that would do the things that the Chinese Communist Party wants. Whether it be a direct payment, or whether it be some other indirect inducement to a family member. Or in the case of a company, providing access to China’s markets. In the case of an investment bank, providing access to sell investments into China, or possibly by investing some of the Chinese Communist Party’s money and thereby earning a fee.

So, there are many ways for the Chinese Communist Party to use money to incentivize those that it wants to control or influence, and that’s essentially how. Because our system is open and, essentially, looks at a nation-state as an actor that will abide by international rules and norms, and the laws of our nation. Then it expects that it won’t try to use that status to undermine the principles and values of the society. And of course, the Chinese Communist Party is exactly about doing that. So they work actively to undermine the principles and values of the United States through its connection to the people of the United States.

― So they have been taking advantage of the openness of the United States.

Spalding: Right.

 

Huawei as a National Security Threat

― Recently, the government of United Kingdom banned Huawei’s 5G network. And France looks ready to follow the United Kingdom eventually. You have warned that Huawei poses as a national security threat. What do you think made these countries realize the threat of Chinese technology?

Spalding: I think it was a rational debate that was held in Washington DC over the last few years of the Trump administration on the value and the danger of being connected to China and the Chinese Communist Party.

The evidence was always there. It’s just that our governments failed to act on it. And in fact, what’s different about the Trump administration is that they have decided to essentially deal with the Chinese Communist Party in China as it is not as we would wish it to be.

― Despite of this kind of policy shift toward China, the Chinese government will never give up its strategy of Made in China 2025. How do you think we can prevent China from entrenching this technology superiority? What is that strategy?

Spalding: So the strategy essentially calls for first to protect the nation and its people by cutting off access to innovation technology, talent, and capital, and to protect the data of the citizens of the United States.

And then to take the innovation technology talent and capital that was going to China and instead reinvested into our people and into our nation. So to invest in infrastructure, in manufacturing, STEM education, in science and technology, and to build a nationwide secure 5G network– and then finally, it’s protection would be rebuilt.

This is also crucial to inspire other countries to adopt democracy, and democratic principles, and free trade, and rule of law, and human rights, and civil liberties. Because they look to the United States and other democracies as they provide prosperity and freedom for their citizens. And so, what’s happened is that since China has been able to use the innovation technology talent and capital of free societies, that they’ve been able to essentially market their vision of the world, which is a much more authoritarian world.

Now when we cut off access to those things and actually invest in our own people and in our own societies, as democracies we’ll be much better off. This is why Japan has been growing stagnantly. When China entered the international order, it began to be very parasitic to the free societies and steal their promise. And in fact, instead of allowing them to steal that, we’re going to invest in our people and in our nation.

 

The Effect of U.S. Bans

― The Trump administration, in posing the ban on federal procurement from businesses that use products made by Huawei and for other Chinese tech companies. Could you tell us how effective these regulations will be in preventing the inflow of back doors from China?

Spalding: I think just like during the Cold War where we had strict export restrictions with the Soviet Union, this is something very similar that is being established with China. And so, I think it would prevent the use of Huawei equipment in the United States, and certainly prevent the export of any US equipment to Huawei.

― As one of the historical “what if’s”; if your memo about secure 5G was accepted by the government in 2017, what the situation would be like today?

Spalding: I think if they had read my paper and acted upon my advice, then they already could have come up with a solution. It’s really not difficult to do. In fact, I started a company two years ago to do that, and we are almost finished building it. But anybody can do this. They just have to have the will and determination to cure data. And I think that’s very important.

 

Should the U.S. Have Built an Alternative to Huawei?

― Do you think the United States should have built alternative to Huawei-like company in the United States?

Spalding: No. I don’t think so. We don’t need a new Huawei. The thing about 5G is it’s really primarily a software-based infrastructure solution. And, so, Huawei is not actually a very good software company. They do make good radio equipment, but in reality, with the virtualization of the 5G environment, the hardware really becomes commoditized except for things like authentication and encryption and maybe some special types of antennas. But for the most part, the secret sauce is in software. And Huawei’s not a good software company. And so the problem is that these governments have relied on the telco industry to guide their understanding about the 5G technology. The telco companies, as I said before, essentially stopped being technology companies. Now, they are more like media or content companies. So because Huawei has done such a good job in undermining the network equipment provider market in our industry and around the world it’s just not been a very good business to be in. And this is a challenge that we face.

But again, governments have failed to lead and provide a solution that enables their people to have secure data. And this is a fundamental failure because in the end, if countries don’t work to secure their digital borders, then their citizens will be influenced from authoritarian regimes like China that create a bastion to protect their own people from knowing the truth, and then from behind that bastion then seek to control what is truth everywhere.

― Although many democratic countries are realizing the risk of Huawei, not so rich countries have no other choice but to use its product. In this situation, in terms of cybersecurity how can we protect ourselves from China’s surveillance system?

Spalding: What I called for was a new standard for 5G security, and, unfortunately, today most Telco’s don’t secure their network to the extent that would be required to protect their users’ data. And in fact, 5G as a technology is primarily developed and designed by China whether it be Huawei or ZTE or other Chinese companies.

And because the telco business has not been able to sufficiently monetize data like the tech companies, they are looking for cheaper and cheaper ways to deploy infrastructure. And the tech companies are essentially taking advantage of the Telco’s by riding over the top and monetizing user data. So this is a business problem supported by a technology problem of open data. And democracies, for the most part, haven’t been very much unable to really figure out this problem.

 

The Chinese Way of Dealing with Data and Controlling Its Citizens

Spalding: The way that China deals with it is to take money from the tech companies Baidu, Alibaba, and Tencent, for example, and give them to the networking companies like Huawei because it is in its interests to own the platform of the future, the computing platform, which is essentially 5G as opposed to the 4G world where the smartphone is the computing platform. And so, as a command economy, China is perfectly suited to use data both for economic dominance in companies like Alibaba but also to control their citizens and then also to export that control to other countries.

And so what free countries need to do is come up with an alternative to this network architecture that China has developed called 5G and create a secure 5G that actually secures the data and prevents the tech companies from coming over the top and going directly to the user but also is compatible with a wide array of Internet of Things equipment. But unfortunately, democratic governments have not been able to come up with the right incentive mechanism to have this occur.

And I think until the market becomes disrupted by a new player that offers secure 5G, it’s going to continue to be a problem for free societies. And the only way to prevent this world where you have, you know, these Internet of Things and smart cities that have the ability to do widespread surveillance, the only way to protect yourselves from that is to not build 5G because if you build 5G, whether it’s Ericsson or Nokia or Huawei, it’s the same network, it’s the same common architecture for 5G because China designed it for the most part and was the chief architect. This is the challenge we face. Until we come up with an alternative standard for secure 5G that building 5G will be very dangerous for democracy.

 

The Chinese Spy Network in the U.S.

― The United States has ordered China to close its consulate in Houston. In fact, the Chinese Communist Party has used its embassies and the consulate for spying. How has China expanded its spy network around the U.S. in the last decades.

Spalding: Because they leverage their 1.4 billion Chinese. They created a law that said that all Chinese must help the country collect intelligence.

 

Chinese Containment

― Do you think that a united front on China is starting to take shape? What do you think we should do to get many other countries included in this movement to contain China?

Spalding: I think in order to get the Chinese involved, we have to talk directly to the Chinese people. The Chinese Communist Party actually prevents that with the great firewall. But I think it’s incumbent upon democracies to talk directly to the Chinese people by going through the great firewall.

― How about other countries like Europe? What could be the incentive for other countries?

Spalding: Essentially, by leveraging their trust in the United States. And the easiest way is to say essentially this, “Do you value the United States as a security partner?” If the answer is yes, and you wish to continue that relationship with the US being a security partner, then you must reconsider your economic and financial and informational ties to the Chinese Communist Party because these ties, insofar as they enable the Chinese Communist Party to undermine your democracy and society and economy, are undermining our collective security relationship. And, therefore, if you’re unwilling to cut off access for China to your innovation technology talent and capital — and here I mean technology that is dual use, which, today, most technology is dual use both for military and commercial purposes. Therefore, the United States can no longer be your security partner if you’re unwilling to cut off access for China to your society.

 

Japan’s Fine Line

― The Japanese government and business world, unfortunately, cannot give up the profits gained by China and still, the Japanese government has not canceled the invitation of President Xi Jinping as a state guest. How do you see the situation?

Spalding: What I would say is I don’t think the United States requires that the Japanese cut off all engagement with China — Just prevent them from having access to their innovation, technology, talent, and capital by ensuring that those Chinese that do come to Japan don’t have access to steal those things or otherwise acquire them both legally or illegally. That’s number one. That doesn’t mean that they can’t have official diplomatic relations with China or have state visits with Chinese leaders because that’s important to prevent miscommunication, confrontation, or to alleviate crises and this is important to have this diplomatic connection.

But what I’m talking about is the economic and the financial or the informational or the technological connections that the Chinese Communist Party uses to get innovation, technology, talent, and capital from Japan to make themselves to continue their rule in China and to continue their predatory behavior on the Japanese economy.

 

Decoupling

― The Japanese government finally started to pay companies to ship production out of China. There is only a small budget and not enough to complete the job. And so, could you give us advice on how to advance this decoupling?

Spalding: The first way it has to do is to make tariffs a permanent feature on Chinese goods in Japan, the second is to prevent Japanese investment into China, and the third is to prevent Chinese investment into Japan. And the fourth is to strictly examine and properly vet any type of educational, or scientific, exchange that may give up innovation, or technology, or talent, for the Chinese Communist Party. And I think if Japan does these things, not only will it protect its intellectual property and data, but it will see economic growth again. And then finally, to build a nationwide secure 5G network that encrypts and preserves the citizens’ data so that it can’t be essentially stolen by China, or tech companies, or anybody else.

 

Quantum Computing

― On July 30th, International Business Machine Corp launched a research partnership with the Japanese industry to accelerate advances in quantum computing to compete with China. Could you tell us about the current progress of China in this field of quantum computing? Is there any possibility that China would achieve quantum supremacy ahead of the US in the future?

Spalding: Sure. Because they’re making it a national priority, and we are not.

― Although it is said that it would take 20 years to put quantum computing into practical application, it also said that in some fields we can potentially see the practical realization in several years. With this technology, how will our world change, especially in terms of national information security?

Spalding: Well, I think there are a number of options available for post-quantum security, or encryption, that prevents your data from being decrypted using a quantum computer. And I think those will very soon be on the market. Of course, 5G provides the type of bandwidth that allows you to have this type of random number-based encryption that will prevent quantum computers from being able to hack that encryption. So, I think the answer is post-quantum encryption, and it shall be available.