Global Pressure Grows for Huawei

By now, I’m sure you know my thoughts on China — Huawei, in particular.

As told in this BBC article:

“Chinese technology giant Huawei starts a four-day online event today focusing on how technology can be used in the fight against the coronavirus.

The “Better World Summit” will also explore how to boost the world economy in the wake of the pandemic.

Meanwhile, HSBC has issued a statement defending its cooperation with the US in a case against Huawei.

It came after Chinese state media accused the London-headquartered bank of “setting traps to ensnare” Huawei.

The world’s biggest telecoms equipment maker said the summit will feature talks by technology industry executives and experts from around the world, including Huawei’s deputy chairman Guo Ping as well as South Africa’s telecoms minister Stella Ndabeni-Abrahams.

The event is being held against the backdrop of growing pressure on the company as tensions rise between Beijing and western governments.”

Keep scrolling to read an old Prophecy I wrote on this topic…

Laddish Behavior and Obsessive Tendencies Plague Huawei

Still in the UK following my wife Nini’s 70th birthday festivities, I find myself constantly pulled away from the mellow fruitfulness of autumnal celebrations toward the shock and shiver of tabloid headlines about rapists and Huawei.

In China I get clues to the future of technology, in Britain I get foretastes of the tang of political correctness.

The Brits pioneered intersectionality, transmania, and animal rights. The new threat, heralded in The Times of London, seems even more menacing. It’s “sports talk in the office.”

Watch it, you guys: “It could exclude women, and lead to ‘laddish’ behavior,” proclaims the front-page lead. “If it just goes unchecked, it’s a signal of a more laddish culture.”

Next step down the slippery slope of the front page and you find Prince Andrew “not cooperating with the FBI” over Jeffrey Epstein’s nympholepsy.

But even more portentous is the ubiquitous concern in the UK — both press and public — about the Trump Administration’s “laddish behavior” over Britain’s refusal to kowtow to the strange US obsession over Huawei.

Socialist Intrusions and No Sovereignty

Secretary of State Mike Pompeo is here full of laddish hormones, threatening to cut off cooperation in trade and intelligence while showing little himself.

“There is no sovereignty,” says Pompeo, “without data sovereignty.” He says we cannot share intelligence data with Britain, or possibly even trade with them if they refuse to banish Huawei.

“Me-too,” huffs un-trumpish Mitt Romney, “The UK is sacrificing national security and inviting the Chinese Communist Party’s surveillance state in.”

“Me-too,” puffs Liz Cheney: “By allowing Huawei into their 5G network, [Prime Minister Boris Johnson] has chosen the surveillance state over the special relationship. Tragic to see our closest ally, a nation Ronald Reagan once called ‘incandescent with courage’ turn away from our alliance and the cause of freedom.”

Sorry folks, but the cause of freedom is not advanced by socialist intrusion of military bureaucracy into telecom networks. This entire campaign is an egregious overreach by the national security state fueled with silly apocalyptic talk about Chinese routers, face recognition, and cameras invading privacy. I would rather have my privacy invaded by a camera than by a cop with a gun. I would rather be recognized for who I am than shrouded in anonymity and global suspicion.

Huawei gear is full of US chips from Intel, Broadcom, Qualcomm, Quorvo, and other suppliers (mostly fabricated in Taiwan). Why doesn’t Huawei fear the manipulation of its electronics through insidious US chip malware? How is our security improved by forcing Huawei not to use US chips, thus depriving the US chip industry of $11 billion of existing business and hundreds of billions of future business?

How is our security improved by forcing China to divorce itself from all the protocols, operating systems, and architectures of our high-tech industry? How is our security enhanced by banning our systems and architectures from the world’s largest and most sophisticated and in some ways even freest market? How is our security aided by harassing Chinese students and forcing them to take all their knowledge and learning back home rather than keeping it here as most of them want to do?

Somehow the wise guys in the Pentagon have concluded that data sovereignty depends on who makes our routers and switches. Because Huawei is a Chinese company, it must comply with Chinese laws requiring cooperation with Intelligence agencies. So what? US companies effectively face similar demands, though without such transparently explicit laws. But networks can be hacked regardless of who makes them or runs them.

American politicians constantly rail against China as a “surveillance state”. But they learned the trade from Americans. The FBI runs a FACE (Facial Analysis, Comparison, and Evaluation) unit that applies artificial intelligence to some 640 million photographs. We are safer for it. The National Security Administration (NSA) is a global hacking pioneer and paragon.

The True Cost of Privacy and Security

In our increasingly bullied and beleaguered private sector, our leading technology companies are as dependent on face recognition as the Chinese. New Apple and Android smartphones use it as a replacement for passwords, which is an entirely benign step forward for privacy and security. Facebook is the eponymous facial recognition player.

Over here, London is as full of cameras as Xinjiang province. But Xinjiang has the pretext of some thousand terrorist attacks in recent years taking the lives of some 500 Chinese. Why the US feels it necessary to harass the Chinese with moralistic preening about alleged offenses against the Uighur Islamists is a great mystery.

The alternative to facial recognition in airports is to treat everyone as a terrorist, which is roughly the TSA solution. The Chinese are moving to a superior method that identifies specific people rather than molests everyone randomly. Although we continue to delude ourselves that the Chinese are stealing our technology, in fact, their companies are decisively in the lead in most fields.

Completely counterproductive for US technology leadership is the protectionist campaign against Huawei, which despite all the contumely is by no means state-owned and is a capitalist telecom competitor in 170 countries.

Hackers are estimated to have stolen a billion items of US personal data in 2018 and perhaps 3 billion in 2019 despite relatively little representation by Huawei anywhere in our networks. Among the famous victims of millions of breaches were the US Personnel Agency and the NSA itself.

The problem of internet security, which makes every network porous and every nation paranoid, is architectural. The chief vulnerability of these networks is the Border Gateway Protocol (BGP), which connects routers across the internet. Its security operates above the network layer, where routers rule, on the Transport layer (TCP). This leaves the internet protocol (IP) network layer mostly unprotected.

Huawei gear implements BGP in its routers, but Huawei had nothing to do with its creation or adoption. If we want to thwart hackers, we would do better welcoming the sophisticated cooperation offered by Huawei chief Ren Zhengfei than by incarcerating his daughter in Canada.

The world needs a new internet architecture establishing a new layer of identity and security on the blockchain.

Let’s get on with it.


George Gilder
Editor, Gilder’s Daily Prophecy

You May Also Be Interested In:

Australia Takes on Coronadoom

The big story of the day is the apparently intractable mania of the politicians apparently fed by the dementia of their constituents. Stuck in a continuous feedback loop with no backpropagation of the constant errors.

Read This
George Gilder

George Gilder is the most knowledgeable man in America when it comes to the future of technology — and its impact on our lives.

He’s an established investor, writer, and economist with an uncanny ability to foresee how new breakthroughs will play out, years in advance.

And he’s certainly no stranger to the financial newsletter...

View More By George Gilder