Promoting innovation, national security, and democratic values in a digital world.

Laissez-faire globalization is at the breaking point. The COVID-19 pandemic and Russia’s invasion of Ukraine finally exposed the fragility of the global economic system after decades of strain caused by the rise of China, and exacerbated by climate change and growing inequality. Now, US leadership is needed to ensure that nationalist and authoritarian forces do not fill the resulting structural vacuum in an increasingly digital world. A new roadmap is needed for how democracies and their allies will address the technological challenges of the 21st century.

Progress has begun. In its first two years, the Biden administration has ushered in a new strategy of industrial policy that includes tens of billions of dollars in technology subsidies. Meanwhile, Europe is pursuing its own Chips Act to boost domestic semiconductor research, development, and production. Together, the transatlantic partners have imposed tough controls on technology exports to Russia and China.

These new policies hold great promise for building more resilient supply chains, creating jobs, and safeguarding national security. Yet the current international economic system is not fit for purpose. The US’s new industrial policy faces accusations of protectionism from allies and competitors. Europe objects to provisions in new clean-energy subsidies, and China has accused the United States of the “weaponization and politicization” of science and technology “to maliciously block and suppress Chinese companies”. 

This backlash risks undermining US efforts to lead on global rules and values. The US must have its allies’ support for addressing technology challenges, from restricting Chinese access to critical semiconductor technology to contesting efforts in standards organizations to approve surveillance technologies. All this must be done in the name of promoting global rules and defending democratic principles and values. Yet questions have emerged about whether a geopolitical digital approach is compatible with the United States’ traditional defense of an open, global internet and human rights more generally. 

Domestically, new US public spending must not crowd out entrepreneurs and innovators, but it must include guardrails to ensure that offline protections and rights apply online. The ecosystems that produce advances in biotechnology, ensure that citizens in repressive countries have access to information, and underpin globally interconnected semiconductor manufacturing require careful nurturing through partnerships with the private sector. A top-down approach will not succeed.

To resolve all these tensions, the United States must plug gaps in the old, 20th-century system with new multistakeholder institutions for the digital age. These building blocks would constitute a new technology policy architecture to support socially responsible innovation and digital trade.  A new foreign policy of technology comprising three key parts is needed to build this new architecture:

  • Nurturing innovation through a Digital Policy Lab: The lab would serve as a platform for domestic public-private-civil society partnerships that would further government capacity-building, agile investment coordination, and development of clear guardrails to enable innovation and democratic accountability.
  • Enabling resilient allied supply chains (or “friend-shoring”) by creating a new international Technology Task Force would deepen cooperation among democracies and allies. Joint action should start by focusing on semiconductors, green technologies (e.g., electric vehicles), and critical minerals. The task force would act like the International Energy Agency, which was built by Organization for Economic Co-operation and Development (OECD) member countries responding to the Organization of the Petroleum Exporting Countries’ (OPEC) oil cartel. It would make available supply and demand data for planning purposes, coordinate responses to shortages or vulnerabilities, including the introduction of subsidies, and provide a venue for countries to reconcile export controls and secure technology standards in areas such as 5/6G.
  • Defending digital democracy by promoting internationally the principles in the Declaration for the Future of the Internet, a commitment signed by 61 countries promising to uphold an “open, free, global, interoperable, reliable, and secure Internet”. This would renew a commitment to a broader conception of internet freedom through ongoing efforts to adopt complementary internet guardrails and hinder internet shutdowns, censorship, surveillance, information operations, and cyberattacks. 

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