Editor’s note: In February, The National Interest organized a symposium on the U.S.-China technology race amidst the emergence of DeepSeek and ongoing legal battles over TikTok. We asked a variety of experts the following question: “What are the three most important technology policies that the U.S. should pursue or avoid to compete adequately with China?“ The following article is one of their responses.
The 21st century will be defined by a race between two competing technological models—one driven by state-directed industrial policy, the other by entrepreneurial dynamism. At stake is not just economic leadership but the architecture of global power itself. The technologies shaping this contest—AI, hypersonic aviation, space-based infrastructure—require vast energy resources, streamlined regulatory frameworks, and a skilled workforce. The challenge for the United States is not merely to innovate faster than China but to remove the bureaucratic inertia that threatens to slow its progress.
If the U.S. fails to counterbalance China’s long-term vision, it risks ceding entire technological domains to Beijing. This requires radical reforms: streamlining approvals for next-generation aviation and satellite networks, accelerating nuclear and geothermal energy permitting, and expanding AI semiconductor research beyond the constraints of traditional funding cycles. The U.S. must also double down on STEM education and workforce development. Studies published in 2023, using the most available data from 2020, shows that China graduates 3.57 million STEM students annually—over four times the U.S. total. Washington cannot compete on numbers alone, but it can aggressively scale AI and semiconductor vocational training through apprenticeship programs, military reskilling initiatives, and federally backed innovation hubs.
The contest between the U.S. and China is not just about developing new technologies—it is about deploying them at scale, faster, and more efficiently than an authoritarian rival that plays by different rules. As Vice President JD Vance put it at the Paris AI Action Summit, “The future is not going to be won by hand-wringing about AI safety. It will be won by building.” That philosophy must extend beyond AI to every frontier technology shaping the global order. The path forward is clear: streamline regulation, fast-track energy and aerospace innovation, and invest in the workforce of the future. The outcome of this race will not be decided in boardrooms or policy papers—it will be determined by which system proves more capable of turning bold ideas into reality. In that battle, America cannot afford to hesitate.
AI’s Energy Hunger and the Need for Fast-Track Infrastructure
By 2030, U.S. data centers could consume 7.5% of national electricity, up from 2.5% in 2022, driven by AI workloads. Comparatively, China’s data centers already use 3.8% of its electricity but benefit from centralized permitting. Its 2023 Green Data Center Initiative fast-tracked approvals for 15 mega-data centers in Inner Mongolia and Gansu, powered by state-subsidized wind and coal. Meanwhile, the U.S. lags behind due to outdated energy permitting laws.
The solution is clear: modernize the National Environmental Policy Act (NEPA) to cut approval timelines for clean energy projects. The average U.S. geothermal project takes 5–7 years to permit, compared to Indonesia’s recent move to shorten the permit process from 18 months to five days. If passed, the Energy Permitting Reform Act could slash these timelines to under three years, unlocking a 500% increase in geothermal capacity and up to 100 GW with a new enhanced geothermal technology. Likewise, the modular nuclear revolution must be accelerated. While the Nuclear Regulatory Commission (NRC) certified NuScale’s SMR design in 2022, the first module is not expected to be operational until 2029, in comparison to China’s ACP100 SMR, which is expected to be operational in 2026, highlighting the urgency of reform. The U.S. must pre-approve SMR designs to reduce deployment time from seven years to three.
Modernizing Aviation and Space Regulations
Innovation in aviation and space is also being slowed by outdated regulations. The FAA’s 1970s-era noise restrictions prevent supersonic commercial flight, putting the U.S. at a disadvantage. Boom Overture designed to cruise at Mach 1.7 remains grounded by regulations, while China’s 2025 hypersonic aviation roadmap aims for Mach 6 passenger planes by 2035. Similarly, space licensing delays have allowed China to surge ahead in satellite launches. SpaceX’s Starship program faced regulatory challenges with the FAA that impacted its launch schedule. The FAA is reviewing safety procedures which has led to delays in upcoming launches. Meanwhile China’s space agency approved 67 launches in 2023 alone. If the U.S. is to reclaim leadership, FCC licensing timelines must be cut to 90 days, and the FAA’s Office of Commercial Space Transportation must receive a 50% budget increase to accommodate growing demand.
The Case for Innovation Zones
To accelerate energy and technology deployment, the U.S. should create Innovation Zones modeled after China’s “East Data West Computing” project, which connects AI hubs and develops data center clusters from Guangdong to Inner Mongolia and from Gansu in the West to Anhui in the East. A Nevada-Georgia-Texas Innovation Corridor could fast-track permitting for AI data center clusters near Las Vegas (geothermal energy), Savannah (SMRs), and El Paso (solar power). These zones could operate under pre-approved permits, reducing bureaucratic slowdowns that currently add years to critical infrastructure projects.
Investing in Supersonic and Space-Based Infrastructure
America must also leverage supersonic aviation and space-based infrastructure as strategic assets. The Pentagon’s 2024 contract with Hermeus for a Mach 5 cargo aircraft has the potential to slash trans-Pacific shipping times from days by sea to a few hours, bypassing maritime chokepoints like the Malacca Strait. Meanwhile, China’s state-owned AVIC is developing a Mach 4 cargo drone by 2026, underscoring the need for urgency.
In space, China is surging ahead with its Guo Wang satellite network, which already includes 13,000 satellites. Meanwhile, the U.S. risks falling behind due to FCC auction delays on new C-band spectrum 5G services, critical for low-Earth orbit dominance. The U.S. must pre-reserve 500 MHz of spectrum by 2025 to ensure its satellite mega-constellations remain competitive.
Beyond satellites, the future of energy may also lie in orbit. Europe’s “Solaris” initiative aims to conduct an in-orbit demonstration of space-based solar power (SBSP) technology by 2030, but China has already committed $500 million to its Zhuri space-based solar power project, targeting a 10 MW station by 2035. The United States should follow Europe and China’s lead and increase funding for orbital power projects, recognizing their potential to provide energy to military bases in the Indo-Pacific, reducing reliance on vulnerable fuel convoys.
Doubling U.S. STEM Graduates Through Education and Immigration Reform
Ultimately, the U.S. cannot win the tech race without radically expanding its STEM workforce. China graduates 3.57 million STEM students annually, compared to 820,000,000 in the U.S. Closing this gap requires a wartime-scale mobilization of education and workforce training.
One solution is the K-12 “Future Tech” Initiative, which would integrate AI programming, quantum computing, and engineering into national education standards by 2026. The federal and state governments, in collaboration with industry leaders, could also establish thousands of STEM-focused schools in underserved areas, ensuring broader access to advanced technological education. Meanwhile, semiconductor and AI workforce development must be dramatically expanded. Workforce development funding should be significantly expanded to support a robust pipeline of talent in critical industries. This includes increasing scholarships for semiconductor engineering and establishing specialized training programs to retrain professionals, including veterans, for high-demand roles in AI, cybersecurity, and advanced manufacturing.
Finally, vocational training for AI and semiconductors must become a national priority. Expanding workforce programs to train technicians in semiconductor fabrication and data center maintenance can help address critical labor shortages and support the growing demand for advanced technology infrastructure. Co-locating these workforce hubs with Innovation Zones would ensure a steady pipeline of skilled workers to support America’s high-tech expansion.
Conclusion: America Must Act Now
The U.S.-China tech race is not just about who invents the future—it is about who builds it first. The choice is clear: America can embrace a bold, high-speed innovation agenda, or it can cede technological leadership to competitors willing to move faster and take greater risks. The necessary reforms—streamlining energy and aerospace approvals, accelerating workforce training, and investing in space-based infrastructure—are not optional. They are essential for ensuring that America remains the preeminent technological power of the 21st century.
About the Author: Mohammed Soliman
Mohammed Soliman is the director of the Strategic Technologies and Cyber Security Program at the Middle East Institute and a member of the global strategy firm McLarty Associates. He also serves as a non-resident senior fellow at the Foreign Policy Research Institute (FPRI) and a visiting fellow with Third Way’s National Security Program. He sits on advisory boards for Ideas Beyond Borders, the Indian Society of Artificial Intelligence and Law (ISAIL), and the Global Commission on Responsible AI in the Military Domain (GC REAIM). Follow him on X: @ThisIsSoliman.
Image: Shutterstock
