The Biden administration revealed an aggressive plan to counter the Chinese military in conversations with American executives.
According to intelligence reports, China was trying to crack the U.S. government's most secure messaging system. The country's progress was a topic of discussion for months.
The Biden administration would try to choke off China's access to advanced chips and chip production tools needed to power those abilities. The goal was to keep Chinese entities out of the picture when it came to potential threats.
The effort, no less than what the Americans had done against Soviet industries during the Cold War, gained steam this year as the United States tested powerful economic tools against Russia as punishment for its invasion of Ukraine. The possibility of a Chinese invasion of Taiwan was made more realistic by the Russian offensive and Beijing's actions.
The most stringent controls by the U.S. government on technology exports to the country in decades were unveiled last week, a move that could affect global commerce.
Jake Sullivan, the national security adviser, talked about a fence for critical technologies in a speech on Wednesday.
He said that the fence had to be high because the competitors should not be able to exploit American and allied technologies.
Interviews with two dozen current and former officials and industry executives gave rise to this account of how President Biden and his aides decided to wage a new global campaign against China. The people spoke on the condition of anonymity.
The Biden administration preferred to announce policies in conjunction with allies to counter rival powers as it did with sanctions against Russia.
The administration spent months in discussions with allies, including the Dutch, Japanese, South Korean, Israeli and British governments, in order to convince them to impose restrictions on the United States.
China is one of the world's largest technology markets and some governments are hesitant to cut it off. The decision to act alone was made by the Biden administration.
The move came after consultation with allies, according to Gregory C. Allen, a former Defense Department official.
In weaponizing its dominant choke-point positions in the global Semiconductor value chain, the US is exercising technological and geopolitical power on an incredible scale.
Certain advanced chips made by American and foreign companies that use U.S. technology can be cut off from China.
The decision to push ahead with export controls was described as a show of leadership. The rules from Washington that encompass foreign companies did the hard work for them because they were afraid of reprisal from China.
Other rules bar American companies from selling Chinese firms equipment or components needed to manufacture advanced chips, and prevent Americans and U.S. companies from giving software updates and other services to China.
The measures do not prohibit foreign companies from selling to China. Experts said the absence of American equipment would make it difficult for China to make advanced chips. As China develops its own production technologies, that leverage could eventually be lost.
Some companies don't like the idea of losing sales. In a call with investors in August, an executive at Tokyo Electron said the company was very concerned that restrictions could prevent its Chinese customers from making chips. ASML has made criticisms.
Applied Materials, an American equipment maker, slashed its outlook for revenue and profit, while TSMC, a Taiwanese chip maker, cut its forecasts for capital expenditure. The companies said demand was going to flag.
The Chinese officials said the U.S. restrictions were meant to sabotage their country. The move could have broad implications, for example, limiting advances in artificial intelligence that propels self-awareness and video recommendation, as well as quashingChina's chip-making industry.
Foreign companies could be punished by China for doing business there. The way Washington is imposing the rules could strain U.S. alliances.
"Sanctions that put the United States at odds with its allies and partners today will both undermine their effectiveness and make it harder to enroll a broad coalition of states in U.S. deterrence efforts," said Jessica Chen Weiss, a professor of government at Cornell University.
The moves didn't come soon enough according to others. Intelligence reports from the U.S. warned that American technology was feeding China's efforts to develop advanced weapons and police its citizens.
In meetings with industry and government officials, the intelligence community began to highlight the risks posed by Chinese advances in artificial intelligence.
Current and former officials and others familiar with the discussions say that Mr. Sullivan and other officials began pushing to curb sales of technology.
Gina Raimondo and her deputy wanted to get the cooperation of allies first. They said in meetings that the United States risked harming its companies without doing anything to stop Chinese firms from buying technology from foreign competitors.
Even though the Trump administration took some aggressive actions against Chinese technology, it began quiet diplomacy on equipment used in the production of chips. Matthew Pottinger is a deputy national security adviser in the Trump administration.
Some negotiations have been difficult. The US tried for months to get the Netherlands to stop ASML from selling older machines to Chinese companies.
In order to restrict the sale and design of chips, the U.S. officials had to negotiate with several other countries.
The United States used a tool to restrict China's access to its technology that had serious flaws. The United States added hundreds of companies to a list of entities that were not allowed to sell sensitive products without a license.
Ivan Kanapathy, a former China director for the National Security Council, said that each listing was tied to a specific company name and address.
Current and former U.S. officials believe the Chinese military and Chinese companies have tried to get access to restricted technology through front companies. The company didn't say anything to comment.
People familiar with the matter said Biden officials believed the restrictions issued by the Trump administration against SMIC had been watered down by industry and were allowing too many sales to continue.
According to an executive familiar with the discussion, Mr. Sullivan told the heads of American equipment makers that the United States wanted to freeze Chinese technology.
Mr. Sullivan, along with Ms. Raimondo and Brian Deese, the director of the National Economic Council, told executives from KLA Corporation, Applied Materials and Lam Research that rules limiting equipment shipments to China would be done with allies.
The measures issued on Friday reflect understandings between the US and its allies, according to a senior administration official.
As negotiations with allied governments continued, experts at the Commerce, Defense, Energy and State Departments spent months poring over spreadsheets listing dozens of Semiconductor tools made by U.S. companies to determine which could be used for advanced chip production
In July, there was troubling news. A report said that SMIC had produced a chip that was comparable to chips made in Taiwan.
The White House and Capitol Hill were unhappy with the achievement.
In August, the Biden administration sent letters to equipment manufacturers and chip makers to stop them from selling to China.
The rules were issued globally on Friday.
The companies stopped shipments to China right away. The US will issue licenses on a case-by-case basis so that companies from the US and allied countries can send technology to their China-based factories. The US government gave the go-ahead for the company to give equipment and items to its facilities in China.
Mr. Pottinger said that the controls could be the beginning of a larger assault on the U.S. government.
He said that the Biden administration understands that it isn't enough for America to run faster and that we need to hamper the P.R.C.'s ambitions for tech dominance. This is an evolution of the administration's thinking.
The reporting was contributed to by two people.
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