התמלול המלא של FCC vs the PRC

department. 00:04:52.560 --> 00:04:53.759 And they worked a little differently. 00:04:53.839 --> 00:05:04.079 They would basically say we've identified a national security risk associated with a combination of this country, in many cases China, and this technology. 00:05:04.240 --> 00:05:17.839 In the case of the Biden administration, this was many uh types of internet uh connected objects, uh, but they focus on cars and are going to make rules that, for example, restrict US sales of cars made by Chinese companies. 00:05:18.000 --> 00:05:21.519 But under Trump, we've seen that office get much quieter. 00:05:21.680 --> 00:05:33.120 My understanding is that it's focused on implementing that connected cars rule passed by the Biden administration, even though President Trump himself has suggested several times that he's open to Chinese companies making cars in the United States. 00:05:33.360 --> 00:05:49.279 It's not for lack of rules under consideration, uh, according to people familiar with the matter, and as we report in this story, last summer that office within the Commerce Department wrote draft rules that would have targeted Chinese components used in data centers, but those rules have never been published. 00:05:49.360 --> 00:05:55.199 And those people also said that commerce was considering a robotics rule, and we haven't seen that come to fruition either. 00:05:55.360 --> 00:06:09.199 Instead, we've seen the FCC impose restrictions on new models of foreign-made humanoid robots and these four-legged robotic dogs, but that will likely end up as the previous FCC measures did, focusing on China. 00:06:09.600 --> 00:06:22.079 And just as a quick follow-up, Noah, if you don't mind, I guess the FCC itself hasn't really been involved in effectively implementing trade policy and to quite this level before. 00:06:22.160 --> 00:06:23.279 Is that fair to say? 00:06:23.680 --> 00:06:28.160 The FCC has really grown into its role over the past decade or so. 00:06:28.399 --> 00:06:59.199 It played a major uh role in beginning to what was called rip and replace infrastructure made by the Chinese telecom giant Huawei and its competitor ZTE out of the United States after some legislation passed uh at the end of the 2010s and in 2020 that gave the FCC new teeth to pursue different types of technology made by different companies that allow it to essentially apply the Huawei playbook to things like drones and routers and power inverters. 00:06:59.279 --> 00:07:00.480 And that's what we're seeing now. 00:07:01.040 --> 00:07:12.000 Are there any downsides that you can see or that you reported on that when you were speaking to people about this from carr's approach effectively banning some of these Chinese products? 00:07:12.160 --> 00:07:16.319 Are there any potential uh flaws to the way this he's going about doing this? 00:07:16.480 --> 00:07:24.079 Do you think one, there are certainly a few that come up when you talk to people in uh the affected industries. 00:07:24.240 --> 00:07:43.120 Uh, one is that the types of restrictions that the FCC has put into place apply to companies uniformly, whether they are based in the United States or based in China, uh, if they are making goods in China or anywhere outside of the US, then the rules apply to them. 00:07:43.439 --> 00:07:47.199 Some people think that you shouldn't treat foreign companies all the same. 00:07:47.360 --> 00:07:58.000 You should treat Chinese companies differently, if that's who you intend to target, then you would treat companies that manufacture that are based in the US and manufacture in Vietnam, for example. 00:07:58.240 --> 00:08:01.519 Another criticism is that these things are going to take some time. 00:08:01.680 --> 00:08:11.279 These new rules have been published with nearly immediate effect, but at the same time, you cannot build a domestic drone industry overnight, uh, for instance. 00:08:11.519 --> 00:08:17.920 Others argue that the United States is in fact closing itself off to technology that it could learn from. 00:08:18.160 --> 00:08:22.319 DJI, for instance, leads the drone industry by a pretty big margin. 00:08:22.480 --> 00:08:30.720 And some people argue that it would be better for DJI to make drones in the United States with a United States partner, with the hope that America gets some tech transfer out of it. 00:08:30.879 --> 00:08:40.879 This is sort of how China built its own auto industry with companies like Ford and like Volkswagen setting up shop and transferring technology to local partners in China. 00:08:41.120 --> 00:08:55.600 At the same time, others counter that that type of agreement doesn't address issues of data collection or remote, remote access by Chinese companies that could be accountable to the Chinese Communist Party under Chinese laws, even if they're operating in the United States. 00:08:55.679 --> 00:08:59.679 And so there's opposition to those types of partnerships on those grounds. 00:09:00.000 --> 00:09:00.639 Fascinating. 00:09:00.799 --> 00:09:08.639 Let's sort of tie this a little bit into what's happening this week, obviously, with Xi Jinping visiting uh Trump in Washington. 00:09:08.879 --> 00:09:21.039 There's a lot of commentary out there this week about how Trump's approach to China maybe has been a little more dovish, a little less hawkish than people maybe were expecting for his second term. 00:09:21.360 --> 00:09:37.120 I just wondered, though, when you look at what Carr's been doing at the FCC, what that that agency's been doing, does it suggest to you at all that the Trump administration this time around has been a little bit more hawkish on China than many people think? 00:09:37.759 --> 00:09:47.519 I think it's fair to point out the ways that the Trump administration has indeed been less hawkish on China than was expected uh for his second term. 00:09:47.679 --> 00:09:54.639 It's loosened export controls on AI chips, for example, in a way that has surprised a lot of people.

00:09:54.720 --> 00:09:59.679 Uh, Trump has held up arm sales to Taiwan and called them a negotiating chip. 00:09:59.840 --> 00:10:03.519 He said that he's open to Chinese auto companies making cars in the United States. 00:10:03.679 --> 00:10:07.759 And he also talks often about how much he admires Xi Jinping. 00:10:07.919 --> 00:10:13.679 But I think it's also worth noting in many ways that this administration is still quite hawkish on China. 00:10:13.840 --> 00:10:17.679 Last year, Trump approved an$11 billion arm sale to Taiwan. 00:10:17.840 --> 00:10:24.320 That's the biggest ever arm sale to Taiwan, even bigger than the total amount of arms sold to Taiwan under President Biden. 00:10:24.639 --> 00:10:27.200 The pause package is even bigger at$14 billion. 00:10:27.519 --> 00:10:30.399 That's the package that Trump has referred to as a negotiating chip. 00:10:30.559 --> 00:10:35.759 Meanwhile, tariffs on China are also far higher than they were before Trump resumed office last January. 00:10:35.919 --> 00:10:46.480 And agencies like the FCC, as you note, are imposing de facto restrictions on Chinese technology in a way that goes beyond what the first Trump administration did or what the Biden administration did. 00:10:46.639 --> 00:10:52.879 As a former colleague of yours said to me this week after you published the piece, it's really just such a mixed bag when it comes to China. 00:10:53.200 --> 00:10:54.879 Looking forward, what do you see now? 00:10:54.960 --> 00:10:58.639 I mean, do you think that the FCC under car is going to carry on in this vein? 00:10:58.799 --> 00:11:01.279 What other sort of actions could it take, do you think? 00:11:01.679 --> 00:11:06.480 So far, the FCC's covered list rules have focused on new models of technology. 00:11:06.559 --> 00:11:14.080 So a company like DJI uh can continue selling older drones, but it just can't sell its newer drones to US customers. 00:11:14.320 --> 00:11:20.000 Over the summer, the FCC sought public comments on whether to add existing models to the covered list, too. 00:11:20.080 --> 00:11:29.200 So an expansion of the covered list to those existing products, uh specifically drones that weigh above a certain amount and have LIDAR or other sensors. 00:11:29.360 --> 00:11:36.480 It's worth noting that most of the comments the FCC got in response to that idea opposed it, but we'll see if they take those into account. 00:11:36.720 --> 00:11:42.799 Another possible addition to the covered list is a data center component called an optical transceiver. 00:11:43.039 --> 00:11:53.440 Reuters reported last month that the FCC is considering adding foreign-made models of them to the covered list, which would follow the same playbook as the drones and routers and robots rules. 00:11:53.600 --> 00:12:00.799 It's a sector that is like others, the FCC has targeted, in that Chinese companies are major players, hold significant market share. 00:12:00.960 --> 00:12:03.919 And when I asked about that, the

FCC declined to comment. 00:12:04.080 --> 00:12:07.759 There's also the possibility of electronics that contain Chinese chips. 00:12:07.919 --> 00:12:11.279 The FCC technically can't add whatever it wants to the covered lists. 00:12:11.360 --> 00:12:19.759 It needs something called a national security determination from an agency that Congress has decided is worthy of deciding that sort of thing. 00:12:20.000 --> 00:12:22.879 But the FCC can participate in those discussions. 00:12:23.039 --> 00:12:30.879 And in July, it did say that if a determination comes through on devices containing Chinese chips, it would add them to the covered list. 00:12:31.039 --> 00:12:38.159 As one telecom lawyer put it to me in the story, the FCC has, quote, massive authority over lots of technology. 00:12:38.320 --> 00:12:40.799 So it really has a lot of room to run. 00:12:40.960 --> 00:12:48.320 And as an FCC official said to me, uh, Chairman Brendan Carr has a saying, it's don't stop at green lights. 00:12:48.480 --> 00:12:51.440 So I think we're going to see a lot more of this going forward. 00:12:52.000 --> 00:12:55.279 Noah, thanks so much for talking us through your story. 00:12:55.440 --> 00:13:00.240 I do encourage all of you out there to read Noah's story for more detail on all of this. 00:13:00.320 --> 00:13:08.720 Uh, it's a really interesting take on a topic that's probably been under-reported and has gone under the radar, but really, really pretty interesting. 00:13:08.879 --> 00:13:11.039 Um, so thank you so much for that, Noah. 00:13:11.279 --> 00:13:20.879 Before we go, I wanted to have a quick word on what else we've been doing at the wire uh for some further insight into how President Trump is approaching China in his second term. 00:13:21.039 --> 00:13:23.919 Our latest edition has an interview with Stephen Vaughan. 00:13:24.000 --> 00:13:29.039 Uh, Vaughan, he was the general counsel to the US trade representative in Trump's first term. 00:13:29.120 --> 00:13:35.120 And that interview's got a lot of insights into how Trump and the people around him are thinking about China. 00:13:35.360 --> 00:13:45.679 Ahead of the summit, also, Savannah Billman has looked into whether the US and China are fulfilling the pledges they made last autumn when she and Trump met in Busan, as I mentioned above. 00:13:45.840 --> 00:13:52.159 We also have a story by Peiue Wu on a key Chinese export that helps keep the lights on across the Western world. 00:13:52.320 --> 00:13:54.320 So don't miss any of those stories. 00:13:54.480 --> 00:13:56.240 The good stuff doesn't stop there. 00:13:56.480 --> 00:14:08.559 This week we've already published a new op-ed by Andrew Tilton and Wei Shan of Goldman Sachs on something that's been a running sore in the US-China relationship, the Renminbi dollar exchange rate. 00:14:08.799 --> 00:14:15.120 We will have a fascinating interview coming out soon with Brian Sei, who runs Concordia AI. 00:14:15.600 --> 00:14:22.320 That's an organization based in Beijing that monitors how China is dealing with AI, the AI technology's rise. 00:14:22.399 --> 00:14:27.519 And we'll have a new op-ed out on Friday with a quick reaction to the Trump Xi Summit outcome. 00:14:27.759 --> 00:14:48.399 To finish up, we've got a quick preview of that interview with Brian Sei, in which he talks a lot about how China is approaching some of the issues that have come to the fore in the Western media in the recent weeks about the dangers of AI and safety, and also how China and the US are going to cooperate on AI. 00:14:49.039 --> 00:14:50.320 Do take a listen to that. 00:14:50.480 --> 00:14:53.840 In the meantime, thank you so much for listening and goodbye. 00:14:56.879 --> 00:15:06.080 Now, in terms of research priorities, I think there isn't a neat pipeline from a leadership speech to a research agenda at a university. 00:15:06.399 --> 00:15:13.600 I think what you see is that is sort of a self-organizing, somewhat top-house ecosystem. 00:15:13.840 --> 00:15:30.240 So when I think of you know some of the AICP conferences that we have hosted in Beijing with the page of AI or the OI conference every year, you know, leading academics present their technical findings, and we see the depth and range of the work has been increasing every year. 00:15:30.480 --> 00:15:41.200 So there is a policy parties set from the top, but I think a lot of the specific technical and scientific problems are still figured out and work out from the bottom. 00:15:41.519 --> 00:15:46.320 Differences with the West, I would say the development and the safety of embodied AI, right? 00:15:46.399 --> 00:15:52.799 Um that is AI interacting with the real world, useful objects, that clearly gets more attention in China. 00:15:52.960 --> 00:15:58.159 Um it's not as surprising in terms of what a deployment is. 00:15:58.320 --> 00:16:06.399 I'm just looking at some of the recent data where 60% of US AI firms are software only. 00:16:06.960 --> 00:16:11.039 In China, maybe you can have a guess, but that figure is closer to 25%.