Can’t solve for China IP theft without acknowledging American history of stolen intellectual property

From its inception, America encouraged immigrating foreigners, private citizens, state officers, and travelling traders to smuggle in industrial designs, drawings, and European innovation to aid in state-building. America pursued contradictory paths in which it incentivised industrial espionage and theft abroad while firming up intellectual property rights and protecting innovations at home.

Historian Doron Ben-Altar portrays America’s Treasury Secretary Hamilton’s ambition as an enabler in what he describes in Trade Secrets: Intellectual Piracy and the Origins of American Industrial Power as “unabashed, state-sanctioned flouting of British law”. America at inception fits the model of a den of rogue economic hitmen and intellectual pirates.

The country’s list of bootlegging and contraband capitalism, as portrayed in In Smuggler Nation: How Illicit Trade Made America, is extensive, ranging from West Indies molasses and Dutch gunpowder in the 18th century to British industrial technologies and African slaves in the 19th century, to French condoms and Canadian booze in the early 20th century, to Mexican workers, Colombian cocaine, and Middle Eastern oil in the 21st century.

The biggest industrial theft in history though was orchestrated by the Soviet Empire and the US Allied Forces against the Nazis. As World War II heated up and Nazis were in retreat, American and Soviet scientists, researchers and analysts teamed up to loot occupied Germany of military, scientific and technological designs. Trailing behind Allied combat troops, technical teams, such as the Technical Industrial Intelligence Branch (TIIB), and the Combined Intelligence Objectives Subcommittee (CIOS), began confiscating and extricating classified research documents and detaining German experts from German corporations like Hoescht, I. G. Farben, Volkswagen, Messerschmitt, Dornier, and hundreds others in the rural towns.

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Visualisation by Juliet Atellah

C. Lester Walker’s Secrets by the Thousands chronicles hundreds of instances where Allied researchers and forces stumbled upon Nazi technologies that were lightyears ahead of what Americans, Soviets, and the British had in their respective countries. This ranged from industrial dyes to V-2 bomb technologies, vaccines, infrared technology, and dairy production designs.

It didn’t take long for research teams embedded among the Allied Forces to realise that they were encountering technology that they couldn’t even operate let alone conceive. This gave birth to Operation Paperclip that saw upwards of 1600 Nazi scientists hurriedly scuttled out of the Nazi-occupied regions onto transatlantic flights heading West.

Annie Jacobsen’s account, In Operation Paperclip: The Secret Intelligence Program That Brought Nazi Scientists to America, proves that the fathers of America’s space technology, Wernher von Braun and Kurt Debus, were senior and controversial Nazi scientists and so were physicists Georg Goubau and Friedwardt Winterberg.

The Soviets too, through Operation Osoaviakhim, repatriated more than 2,200 German specialists to work in the Soviet Union as the Red Army ransacked the other end of the Nazi Empire. The operation conducted under the leadership of Russia’s KGB boss Ivan Alexandrovich Serov on 22 October 1946 targeted mostly military technology, a tragic tunnel vision that fueled their loss during their Cold War against the West.

The Hoover Fellow Norman M. Naimark, in The Russians in Germany, paints the Soviet industrial age dilemma, given that, unlike the Americans and the Allied forces, the Germans weren’t too far from the Soviet border. The capture of the Nazi scientists therefore carried with it urgent anthropological and historical issues for which mythmaking and brainwashing were deemed necessary.

As Lester Walker notes, it’s a disturbing realisation for modern humans that the most creative period in world history may have occurred under the Nazis between 1932 and 1945, and that it was the murderous and racist Nazis’ scientific research breakthroughs that gifted the modern world a significant majority of its current industrial and technological conveniences.

Espionage? Moi?

Still is it even a vice if the French haven’t tried it? In a 2014 WikiLeaks cable Berry Smutny, the head of the German satellite company OHB Technology, called France the top offender when it comes to industrial espionage, terming them worse than China and Russia.

France has consistently been accused over the decades of going after military, space and aviation technology from every country it deems to have superior inventions in these fields. America’s former Defense Secretary Robert Gates asserts that besides China, France is the second most tenacious and capable cybersecurity risk to America’s defences.

It’s laughably obtuse, therefore, given the historical economic records, for Europe and America to consistently complain over what they dub China’s massive industrial espionage. According to the US authorities, from 2011 more than 90 per cent of the State Department’s cases alleging economic espionage involving a state pointed at China, and more than two-thirds of the Department’s theft of trade secrets cases were directly linked to China.

For a country with at least 1.2 billion citizens, and 100 cities with at least 1 million people each, and at least 100 firms with a market capitalisation of over $1 billion dollars, China seems unstoppable.

Between 1978 and 2017, China lifted roughly 600 million citizens out of poverty, averaging at 20 million each year, leading to an overall 94.4 percentage points reduction in poverty. By any measure, the economic progress that started with Deng Xiaoping in 1978 remains the greatest economic miracle in the history of mankind. The country’s economic engines might keep pumping for another decade or two before it plateaus out. That’s not how the West view it though. In China, they see a rogue state who steals ideas, and one who’s refused to anchor her growth trajectory on Western patronage and powers, like Japan did in the 80s.

Trade is war

Further south, Africa’s wealth, encumbered by global geopolitical and geo-economic contestations, has consistently been the site of plunder effected through tax havens and illicit financial flows. A significant chunk of this resource theft takes advantage of weak legislation, sleaze, civil wars, population displacement, and weak governance structures. The spread and pervasiveness of this economic carnage can be at best quantified through the over $200 billion in mostly illicit outflows and less than $160 billion inflows through loans and grants.

The Ugandan scholar Yash Tandon, who’s an honorary Professor at Warwick and London Middlesex University, consistently warns African countries that trade is a battle and often a zero sum game often pegged on the scale and efficacy of industrial espionage. Africa, as a crucible of innovation over the last 3,000 years, hasn’t properly calibrated its creative contribution to modern civilization and the resultant loss from corporate espionage.

In Trade is War, Tandon demonstrably shows the Bretton Woods institutions for what they really are: internationally tentacled Western leeches designed to loot African economies and resources. His valuable insider view traces the skewed and aptly misnamed free trade agreements as simply state-sanctioned industrial espionage where economic hitmanship are ratified through charters.