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American Law Firms Confront China's Engineering Powerhouse

‘Engineer’s China, Lawyer’s America.’ A viewpoint that presents the U.S. and China as opposing mirrors has attracted interest in American so...

‘Engineer’s China, Lawyer’s America.’

A viewpoint that presents the U.S. and China as opposing mirrors has attracted interest in American society. This perspective on the U.S.-China rivalry is offered by Dan Wang, a Chinese-Canadian researcher affiliated with Stanford University’s Hoover Institution. In a video interview with WEEKLY BIZ on the 11th, he stated, “While China is a 'construction society' focused on technology and engineering, the U.S. is a 'barrier society' where lawyers govern the world through legal frameworks.”

This viewpoint is widely accepted in the U.S. as it naturally reflects Americans' feeling of powerlessness regarding their lost construction and manufacturing industries and offers a new framework that has gained widespread agreement. His book *Breakneck: A Chinese Quest to Build the Future*, which outlines this perspective, became a *New York Times* bestseller following its August release and was recognized as one of the year's top books by *The New Yorker*. WEEKLY BIZ spoke with Wang, who examines the different development trajectories and issues of the U.S. and China, about his opinions on the U.S.-China rivalry and future possibilities.

◇ A Fresh Outlook on the United States and China

-You described the connection between the two nations from a completely new angle. Why?

I believed that traditional terms such as democracy, socialism, and neoliberalism were not adequate to describe the intricate connection between the U.S. and China at present. This is why I started referring to China as an 'engineer's nation' and the U.S. as a 'lawyer's society.'

- What does the term "engineer's nation" specifically refer to?

China is a state characterized by Leninist technocracy. For many years, its ruling class has mainly been composed of engineers specialized in construction. These technocrats were educated in the Soviet-style approach to heavy industry (civil and mechanical engineering). They have constructed numerous homes, railways, bridges, and highways across the country, and have followed a development strategy centered on investments in physical infrastructure.

-What does the term "lawyer's society" represent?

I see the U.S. as a society composed of legal professionals. Thirteen out of the first 16 U.S. presidents, ranging from George Washington to Abraham Lincoln, were lawyers, and the Declaration of Independence was drafted in a manner similar to a legal text. In recent times, five of the last ten presidents have attended law school. Lawyers excel at 'blocking' (regulation) but are less skilled at 'building' (construction and manufacturing). As a result, the U.S. avoids implementing misguided policies such as (China's) 'one-child policy,' yet it struggles to properly develop even fundamental infrastructure.

-What motivated China to transform into a nation of engineers?

The Chinese Communist Party has a strong fascination with technology. The belief that China's 'century of humiliation' under Western and Japanese imperialism was due to technological backwardness is deeply rooted. As a result, there is a firm resolve to emerge as a technological superpower in areas such as shipbuilding, chemicals, aviation, and semiconductors. I think the concept of China as an engineer-driven nation started to take form during Deng Xiaoping's time in the 1980s. Throughout the 1980s, engineering graduates began to join the Central Committee and Politburo, and in 2002, all nine members of the Politburo Standing Committee, including Hu Jintao, were engineering graduates.

-Does this not oversimplify the two nations?

My concept is more of a creative and fun effort to understand the 21st century rather than a formal academic theory. Naturally, China continues to be a Leninist system, and the U.S. can also be analyzed using different ideas. I simply believe a new approach is necessary to examine the relationship between these two countries from a fresh perspective.

◇China’s Breakneck Pace

-Describe the process that led to the rapid growth of Chinese manufacturing and infrastructure.

China's construction framework functions quite logically. Constructing major bridges or subways demands a structured and effective system. For instance, railways in authoritarian systems tend to be more direct than those in democracies, where resistance from landowners leads to more curved routes. Moreover, China's administrative system consistently envisions the 'next significant project.'

-What particular variations have you noticed?

Consider power generation: While the U.S. experienced an average annual growth of 2% over many years, China currently possesses double the power generation capacity of the U.S. This year, it intends to install 300 gigawatts of solar energy, in contrast to 30 gigawatts in the U.S. Regarding nuclear energy, China is constructing 33 reactors, whereas the U.S. has none. In nearly all areas of physical infrastructure—such as ports, rail systems, airports, and power networks—China is significantly ahead.

-There are criticisms suggesting that China's innovation is based on copying and government support.

A significant portion of this is accurate. However, every latecomer has managed to catch up by emulating advanced countries. During the 18th-century Industrial Revolution, engineers pilfered British technology and introduced it to the U.S. Japan replicated Germany's methods, and South Korea followed in Japan's footsteps. Now, it's China's turn. But asserting that 'China only copies' is an overgeneralization. They manufacture iPhones more efficiently, develop electric vehicles at a quicker pace, and consistently conduct experiments to enhance battery technology. Chinese capitalism is far more competitive than that of the United States. While car development typically takes six years in Japan, Germany, or the U.S., China accomplishes it within 18–24 months. China's system is too intricate to be simply labeled as 'theft.'

- What are the distinctions between the two nations in terms of education and training?

The main distinction lies in the career paths taken after graduation. Top U.S. engineering graduates often pursue roles in Wall Street hedge funds or the AI divisions of major tech companies due to higher salaries and more favorable working conditions compared to factory jobs. On the other hand, Chinese engineering graduates tend to opt for careers in manufacturing and on-site positions. The U.S. offers outstanding education, yet its skilled professionals do not typically gravitate towards manufacturing locations.

◇The Influence of an Engineer's Country

-Is there any disadvantage associated with an engineer's country, China?

China often views its population as a design element, similar to building materials that can be cut and molded as desired. The Communist Party aims to shape not only economic matters but also social events, such as the distribution of talent. It directs intelligent individuals into fields like semiconductors and aviation. Although an engineering approach to physical infrastructure might have beneficial outcomes, social engineering—regarding the population and society as 'math problems'—has led to largely negative consequences.

-Can you give concrete examples?

First, there's the previous 'one-child policy.' This policy resulted in over 300 million abortions and forced sterilizations of approximately 100 million women and 25 million men. I refer to this policy as a 'terror campaign of horror inflicted on the bodies of rural women.' It started when a missile engineer close to Deng Xiaoping suggested to him that it was an 'elegant solution' to China's overpopulation issue. Ironically, now that China is dealing with a low birthrate crisis, it is once again attempting to 'engineer' women. Low-level Communist Party officials are pressuring married women with questions such as, 'Do you plan to have more children?' The 'Zero-COVID' policy is similar. Although it initially appeared successful, the Shanghai city lockdown in 2022 was the largest-scale human confinement experiment in history—something only possible in an engineer-driven society.

-Can Xi Jinping's authoritarian leadership eventually impede China's progress?

It is already limiting the country in various ways. The affluent are relocating assets and companies abroad, while creative individuals such as journalists and artists are leaving for Singapore, London, New York, and Chiang Mai. Last year, approximately 40,000 Chinese citizens were apprehended attempting to cross the Mexican border through Ecuador to enter the U.S. This indicates that even Chinese elites are discontented and perceive the country as unsafe. In China, even high-tech entrepreneurs can be removed from their positions, and financial professionals encounter salary limits.

◇"Detaining Koreans: Trump's Major Error"

-What about the United States' weaknesses? Can the MAGA (Make America Great Again) approach overcome China?

Initially, Trump's approach to tariffs is evidently not working. It led to a decrease in manufacturing jobs and introduced uncertainty for companies. The U.S. government does not appear to be truly committed to manufacturing. Although certain deregulation and energy policies might have beneficial aspects, Trump is against wind power and does not support solar energy. Considering coal and gas as future energy sources is outdated. In general, there is no indication of a well-thought-out strategy for revitalizing manufacturing.

- What must the U.S. do to regain its status as a leading manufacturing nation? What is your opinion on Trump's policy of imposing high tariffs?

First, eliminate tariffs. Approximately 40,000 manufacturing jobs have been lost in the U.S. since Trump implemented high tariffs. Second, increase funding for scientific research. It's impossible to remain a technological leader while reducing budgets for universities and corporations. Third, encourage foreign talent. Trump's criticism of universities has discouraged international individuals from coming to the U.S. Permit greater foreign investment in U.S. factory development. The U.S. should adopt a strategy similar to China's, which brought in Tesla, Apple, and Walmart to establish an ecosystem. Most importantly, the U.S. needs to recognize that 'we have fallen behind.'

Dan Wang referred to the September event in which U.S. immigration officials detained more than 300 Koreans employed at a Hyundai Motor Group and LG Energy Solution joint battery plant in Savannah, Georgia. He stated, “It's extremely challenging to attract top-tier talent locally. I believe one of the major errors by the Trump administration this year was federal immigration officers restraining and deporting 300 Korean engineers in Georgia. This approach is not appropriate for handling foreign expertise and sends a negative message. If I were an engineer abroad and my company asked me to go to the U.S., I would think twice before accepting.”

- Who is likely to emerge victorious in the U.S.-China rivalry?

Structural elements by themselves cannot decide a single victor. The competition will be an extended contest. The leading nation is likely to make errors because of overconfidence, while the country lagging behind will close the gap through reforms. Observing the U.S.'s disorganized response to the COVID-19 pandemic and the January 6 Capitol riot in 2021, Xi Jinping grew overly confident and intensified control over domestic tech giants such as Alibaba and the real estate sector. The consequences of these choices continue to affect the Chinese economy. I believe there is a very active race that will persist for a long time, one that cannot be fully grasped through static factors like democracy, population, or technology.

◇AI War: Who Will Prevail?

-Will China's manufacturing edge continue to be relevant in the age of artificial intelligence?

Silicon Valley is currently leading the way. However, China is quickly gaining ground in several 'reasoning model' areas. As AI grows into a power-demanding industry, China's power capacity—double that of the U.S.—could provide an edge. Another factor is the significant number of ethnic Chinese among America's top AI researchers. If Trump's immigration policies become stricter, some might choose to return to their home country, bringing their expertise and connections with them. Moreover, the U.S., which is focused on services, may use AI to create more effective PowerPoint presentations or handle more legal cases. In contrast, China, which is centered around manufacturing, is more inclined to apply AI to produce more iPhones, drones, and ammunition. In this scenario, China's ability to overproduce could be more beneficial.

-Can U.S. restrictions on semiconductors significantly limit China?

Temporarily, yes. They are hindering the construction of data centers and the expansion of computing power. However, in the long run, this will speed up China's move towards self-sufficiency. I refer to this as China's 'Sputnik moment'—a significant turning point for reform. Companies such as Huawei, ByteDance, DJI, and Alibaba, having recognized the dangers of relying on the U.S., are striving for self-reliance not due to political allegiance but for survival. No nation has ever maintained a permanent hold on key technologies. Britain, the U.S., and ultimately, China, will overcome these limitations to a considerable degree.

- Who will emerge as the final victor in the realm of AI?

The competition is a long-term endeavor, and the future path of AI is still unclear. In Silicon Valley, many Americans perceive AI as a 'God in a box'—a superintelligence that manages everything by being more intelligent than humans. On the other hand, China sees AI as yet another technology that can be controlled and incorporated into every aspect of factory processes. Due to these significant differences in approach, it's premature to determine a winner. The specific direction AI will follow has not yet been determined.

-Is there space for third countries to participate in the AI race?

There is always space available. Nations such as South Korea, Australia, and Germany need to determine what they are capable of. Nevertheless, it is evident that the U.S. and China are shaping the future as two dominant forces. Other countries should create development strategies by identifying areas where they can excel.

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Union Hotel: American Law Firms Confront China's Engineering Powerhouse
American Law Firms Confront China's Engineering Powerhouse
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