In 1898, steel vessels of the U.S. Navy Asiatic Squadron achieved a resounding victory over the older, unarmed, and, in some cases, wooden Spanish ships in the Battle of Manila Bay. The U.S. Navy modernization had begun years earlier. Credit: Battle of Manila Bay by J. G. Tyler.
If the West neglects its technological edge, authoritarian regimes will seize the opportunity to impose a far more dangerous global order.
Today’s world is more digital and interconnected than ever before. Networks, data, and digital technologies now define its power structures.1 A new geopolitical order driven by the rise of “tech-enabled states” is emerging.
Tech-enabled states leverage their domestic tech industries to influence and design emerging global norms, harnessing the power of data and digital technology to transform their internal bureaucracies and national defense systems. These states continue to emerge and reshape global power dynamics. Therefore, it is critical to understand their history, structure, and broader implications for geopolitics.
The Internet Changed Our Understanding of Power
The roots of this extensive transformation can be traced back to the initial development of ARPANET,2 the precursor to today’s Internet. Even in its infancy, the Internet was used to grapple for global influence, with ARPANET being deployed to enhance U.S. research and information-sharing capabilities during the Cold War era. But what had started as a scientific endeavor quickly transformed into something more. Under the guidance of the Clinton administration, a decision was made to privatize the development and operation of the Internet.3 This decision led to the rapid global proliferation of Internet infrastructure and an explosion in the number of users accessing it.
What followed was an era of optimism driven by the belief that the Internet, computers, and increased access to information would finally liberate individuals living under authoritarian regimes. It was believed that exposing those under the thumb of authoritarian rulers to democratic norms, values, and ideals would hasten democracy’s global expansion. Early advocates for the Internet even claimed that cyberspace was entirely outside of the control of any state, offering true freedom.4 President Clinton shared these sentiments, declaring that “in the new century, liberty will spread by cell phone and cable modem,” and that trying to control or censor the Internet would be like “trying to nail Jell-o to the wall.“5 Combined with the disintegration of the Soviet Union, it is easy to see why many argued that this broader trend towards globalization, interconnection, digitalization, and democratization marked the “end of history.”6
Unfortunately, the “end of history” only represented the end of an optimistic era, and we now understand that a democratic digital future is not guaranteed. Worse, without significant changes, democracy is fighting an uphill battle. Far from undermining authoritarian systems, the Internet and digital technologies have empowered them. Now, authoritarian states such as Russia and China are embracing technology, using it to strengthen their rule and engage in aggression, surveillance, and control to an unprecedented scale.7, 8
A Strong Domestic Tech Industry Is No Luxury
If it was once possible for some in the West to ignore the rise of techno-authoritarianism and the primacy of digital technologies in defining the structure of the global political system. But recent advances in artificial intelligence (AI) have forced states to start paying attention and grappling with its potential to disrupt our world.9 In order to control the future trajectory of AI and digitalization more broadly, states are relying on their domestic technology industries to effect change and demonstrate power abroad. For example, Taiwan and the Netherlands have quickly become global power brokers due to their dominance of key aspects of the chip manufacturing process.10 The United States, too, has demonstrated its willingness to utilize its control over digital “chokepoints” in global Internet communications and financial flows to achieve its aims.11
To succeed in this system, tech-enabled states must be paired with strong domestic technology capabilities that are able to influence the ownership, operation, or control of the world’s digital infrastructure. However, if these capabilities are based only within a handful of firms, some claim, it could set the stage for companies to surpass the state in power, leading to the eventual demise of the state itself.12 Policymakers around the world are now responding to this perceived threat with vigorous calls for “strategic autonomy” and “digital sovereignty”13 to reduce their dependence on a single nation’s technology industry or even a single software company.14, 15 These concerns are understandable but largely misplaced.
Western technology firms finding themselves increasingly in competition with competent, authoritarian-aligned, and state-sponsored technology companies will encourage Western states and technology firms to support each other. By out-competing their authoritarian-aligned competition, these firms can help to advance the mission of democratically aligned states, but only if these states provide the firms with the freedom and support to do so. It is therefore in the best interest of the Western-based technology industry to support their states, not undermine them.
Rather than fearing digital innovation and emerging technologies, successful tech-enabled states must instead support development and growth. If technology firms are given the ability to innovate by the state, then the state is rewarded with new technological capabilities to deploy. Though the monopolization of the technology industry must be resisted, strong technology firms are clearly needed. Thus, any efforts to disrupt or reshape the technology market must ensure that it does not weaken the sector. To achieve this balance there is a need for states to create the conditions for both “big” and “small” tech industries to thrive, innovate, build, and scale. Supported by a pro-innovation regulatory framework, tech-enabled states will find themselves more powerful than ever before.
Internal Digitalization of Tech-Enabled States
In this contest between democratic versus authoritarian-aligned tech-enabled states, one growing but overlooked area of conflict is the internal digitalization of the state. Around the world, governments are experiencing a growing technological skills gap between the public and private sectors, which increases costs and decreases productivity in the public sector.16 Many of these barriers can be overcome with new investments in, and the adoption of, data-driven systems. Having a strong and innovative public sector that strategically leverages data and information has always been a component of a state’s strength and power. In the digital age this has only amplified.
As a result, governments around the world are investing immense resources into new digitalization initiatives. States that are successful in digitalizing and exporting their systems abroad will have the power and influence to dictate the future of our digital world. Home to the most powerful technological innovation systems, the United States should demonstrate what a new, innovative tech-enabled state looks like. Much of the world’s technological development is already dependent in many ways on American science and infrastructure.
However, the United States has failed to turn this innovation ecosystem inward. Instead, it is in the process of becoming a “decaying digital superpower”17 with a large dependence on crumbling legacy digital infrastructure defined by “vulnerable networks, antiquated hardware, and duplicative systems.”18 The federal government alone, according to a recent GAO study, spends hundreds of millions of dollars every year on antiquated IT infrastructure that leaves the country increasingly vulnerable to adversarial cyber threats.19 As the United States fails to develop and diffuse new digital systems for running tech-enabled states efficiently, countries like China are increasingly filling the gap, moving the world ever closer to a digital-enabled authoritarian future.20
China’s digital innovation ecosystem is large, second only to that of the United States, and is supported by a robust and highly capable technology industry. Technology plays a key role in China’s global ambitions: Beijing has announced its aim to be the world’s leader in AI by 203021 and the global leader in digital technology overall by 2035.22 These ambitions have been supported by vast investments and support for the implementation of digital surveillance solutions inside China’s borders to improve the management, functioning, and efficiency of the Chinese state.23 The size of this ecosystem is vast, with more than 400 million surveillance cameras integrated with AI capabilities being used as part of the “Golden Shield” program aimed to increase public safety.24
The functionality of China’s technological ecosystem is impressive, perhaps the world’s best at seamlessly integrating key functions and sectors such as financial services, e-commerce, communications, and more. But these solutions come at a steep cost: the loss of individuals’ privacy, decreased transparency of decision-making, and clear threats to human rights.25 However, these systems work so well that in the absence of any viable alternative from the democratically aligned West, the Chinese have found much success in exporting them abroad as part of their “Digital Silk Road” initiative.26 Countries like Ethiopia, Kenya, and Uganda are already cooperating with Chinese companies to develop new “Smart Cities” powered by Chinese digital infrastructure.27
Though the United States and China are at the forefront of this emerging era of tech-enabled states, they are not alone. Many states are now rushing to stake their place in the emerging geopolitical order to influence the global conversation on what it means to be a tech-enabled state and how to best build and design the technology that runs them. Estonia is one state that demonstrates this well. With a small population of just over one million people, the country should not be a global digital leader. However, Estonia’s use of digital technologies to transform its public sector has allowed it to become one of the most efficient in the world.28 High-level delegations from around the world now travel to the small Baltic nation to learn how their success could be replicated elsewhere.
War By Bits
In an era defined by tech-enabled states, it is no longer possible to separate internal digitalization from broader geopolitical concerns. Instead, the strongest tech-enabled states, possessing both robust domestic technology capabilities and high levels of internal digitalization, will rush to develop the systems, standards, rules, and values that will come to define the world’s digital future. At the same time, tech-enabled states become increasingly reliant on potentially vulnerable data, networks, information, and digital technologies. How the world thinks about power, conflict, and confrontation must change.
In 2007, Estonia became the target of an almost month-long cyber attack intended to significantly disrupt the functioning of the state.29 This attack is understood to have originated from its eastern neighbor, Russia. Though rather simple, these attacks led to significant disruption in the availability of essential state websites, banks, and news organizations. Estonia had integrated technology throughout their society, and while this created large benefits for the country it also created new and significant threats. This is a paradox that all tech-enabled states must face: the stronger and more digital they become, the bigger risk cyber threats may pose to their security. Left unprepared, tech-enabled states could find their operations at the mercy of their adversaries.
In response to the 2007 cyber attack, Estonia coordinated the development of the “Tallinn Manual,”30 widely recognized as the first international study that outlines the legal dimensions of cyber war. Since then, Estonia has become an important global voice on cyber warfare and cyber security, bringing the world’s attention to the new ways that tech-enabled states will experience and fight the wars of the future. While turning its attention to cyber defense and putting cyber security at the forefront of its digitalization mission, Estonia went further. In 2017, the country launched the world’s first “data embassy.” This initiative maintains a secure backup of Estonia’s critical digital registries, setting the foundations for digital continuity and ensuring that the country can operate even if it loses control of its physical territory.31
As the war in Ukraine has shown, Estonia’s early efforts were prophetic. In the earliest stages of the Russian invasion of Ukraine, a massive cyber assault was launched that targeted the country’s digital infrastructure.32 The Western technology companies that provided much of the infrastructure for Ukraine’s government quickly found themselves working together to defend against a world-leading cyber power, Russia. As part of this defense, the Ukrainian government and its Western allies moved quickly to exfiltrate and distribute key Ukrainian digital databases from data centers targeted by Russian missiles to the cloud.33 This step allowed the Ukrainian government to maintain its operations during a time of war in ways that would not have been possible historically. In the era of tech-enabled states, war and conflict will not only require occupation of an adversary’s territory, but complete dominance of their digital systems as well.
China understands this new and emerging geopolitical environment well, and has made great strides in developing state-of-the-art offensive and defensive cyber capabilities. In 2012, Hu Jintao called for China to “unswervingly pursue full IT application as the goal in achieving military modernization.”34 By 2014 China had “already created the world’s most powerful cyber-based system for internal political surveillance.”35 China continues to make large investments in its military modernization, especially in emerging digital technologies and autonomous warfare capabilities.36 Yet to effectively use and leverage an interconnected network of autonomous drones, new internal digital systems are required to manage the vast amounts of data. China has therefore prioritized the internal digitalization of its armed forces as well. If successful, this would enable the quick collection, management, and use of data and information it needs to fight in an increasingly autonomous combat environment.
Like China, the United States is a world-leading actor in conducting offensive cyber operations, in part due to its private sector’s overwhelming dominance and control of the world’s digital and communications infrastructure. To better control the cyber domain, the United States created the Cyber Command in 2009. Its remit: to “conduct full spectrum military cyberspace operations in order to enable actions in all domains, ensure US/Allied freedom of action in cyberspace and deny the same to our adversaries.”37 The U.S. Cyber Command actively deploys teams to allied nations to confront adversarial threats. Under the Trump administration, the command redoubled its efforts on engaging threats emerging from China and other authoritarian states.38
But though the United States is a world-leading cyber power, it continues to fall further behind its adversaries in developing and adopting new autonomous capabilities. This leads many to argue that the country is “not ready for the wars of the future.” 39 The situation is made worse as the “Pentagon spends only pennies on innovation for each dollar it throws at legacy systems.”40 In addition, the U.S. Department of Defense is hampered by clumsy bureaucratic processes and over-relies on a few large technology providers, resulting in an inability to effectively leverage emerging technologies, such as AI, to improve its data-driven decision-making.41
The increasing centrality of autonomous applications to the military strategies of tech-enabled states creates new dependencies on the firms that provide these capabilities. In a future conflict where all involved parties are using autonomous technologies, the state deploying the system with quicker and superior decision-making ability will have the advantage. Authoritarian states’ ability to centralize and use data in virtually unlimited ways provides them with a built-in advantage over their democratically aligned rivals. To make up for this deficit, democratically aligned tech-enabled states must digitalize faster and support their private sectors’ ability to innovate faster than their enemies.
Conclusion
The arrival of tech-enabled states, driven by new and emerging technological innovations, has fundamentally altered longstanding global power dynamics. The world now faces a pivotal choice: What will its digital future look like, authoritarian or democratic?
In the West, many policymakers fear the growing capabilities of technology and the firms – both large and small – that build it. These fears are misplaced and dangerous. By failing to embrace technology, these states have created room for truly authoritarian-aligned governments to offer an alternative and dangerous vision for the world.
To counter a future defined by authoritarian tech-enabled states, Western policymakers must recognize that technology and the state are not antagonistic but mutually beneficial. Technology must be integrated into the very fabric of what a state is and does. By harnessing emerging technologies and collaborating with the firms that develop them, tech-enabled states can become more efficient, effective, and prosperous.
Developing domestic technology capabilities is essential to the strategy of building a strong and powerful tech-enabled state, but it is not enough on its own. This transformation must also be supported by regulatory initiatives that support innovation and ensure the spread of liberal and democratic values. In a world increasingly defined by democratic backsliding, erosion of liberal norms, and a turn towards authoritarianism, democratically aligned tech-enabled states must lead the way to secure a prosperous future.
References
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2 Defense Advanced Research Projects Agency, “ARPANET,” U.S. Department of Defense, July 9, 2020.
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