Cybersecurity can be America’s secret weapon in the AI race

Much of the public conversation about the U.S. “winning” the AI race with China centers exclusively on each nations’ ability to develop and implement leading AI models. But amid escalating cyber threats, the rising reality is that the race will not be won merely by the nation with the most advanced technology, but the one the rest of the world trusts to provide it. Advanced models are certainly table-stakes, but trust and security can be America’s biggest differentiators. 

The competitive, free-market ecosystem has allowed thousands of U.S. AI firms to deliver cutting-edge hardware and software around the world. In contrast, 70 percent of China’s AI cloud market is held by just two firms: Baidu and Huawei. Private sector consolidation is vital to Beijing’s national AI strategy: data captured from low-cost commercial exports is used to train civil-military fusion systems that strengthen its power at home and spread its malign influence abroad. Heavy-handed state requirements force domestic firms to adopt domestic technology and reject superior U.S. imports. 

A strong U.S. AI strategy to counter China’s civil-military fusion should be built on what makes American innovation thrive–not on policies that slow down our free-market ecosystem. Trade policies that prioritize broad export controls and tariffs have accelerated China’s domestic chip production and strained relationships with U.S. allies in exchange for only about a one-year edge in AI scaling and model development. 

AI leadership will not be won through Chinese tech scarcity; it must come from recognizing our competitive advantages, sustained international investment and the ability of U.S. firms to outcompete their state-subsidized rivals in security and trust. 

The U.S. policy ecosystem can seize a prime opportunity for AI leadership by supporting our thriving private-sector cybersecurity industry, whose rapid adoption of AI is revolutionizing the pace of offense and defense in cyberspace. The United States accounts for roughly 40 percent of global cybersecurity spending, while China represents closer to 3 percent. That’s not a coincidence. Beijing’s tight control over data, its limited tolerance for private-sector risk disclosure, and its prioritization of offensive cyber operations over market-driven defense will never fuel a competitive cybersecurity ecosystem. 

That disparity is a strategic advantage for the United States. Faced with a daily barrage of cyberattacks, U.S. cybersecurity firms operate in an environment defined by real threats, real liability, and real consequences for failure. American AI and cloud security tools are tested at scale across finance, energy, healthcare, critical infrastructure, and government systems. They improve through deployment, not federal decree—and as a result, maintain defensive capabilities that Chinese firms struggle to replicate outside controlled environments. 

If Washington wants to win where Beijing can’t, it should treat its AI-powered cloud security industry as a strategic export. Global leadership in the cybersecurity economy requires aligning policy with technology markets: targeted tax credits for secure cloud infrastructure, fast-tracking GPU sales for defensive cyber applications, and improving U.S. tech diplomacy would lower scaling costs while preserving competition. 

Governments and enterprises prefer U.S. cloud and security services to subsidized Chinese alternatives, but high costs and uneven regulatory requirements frequently get in the way. Pair export financing with U.S. AI and cloud cybersecurity offerings so American firms to compete in price-sensitive markets where AI demand is expected to grow the most in the coming decades. Streamlined data transfer, cloud, and security agreements can expand addressable markets and strengthen U.S. cyber norms without spending a penny of taxpayer money on export control enforcement. 

In its dialogues with interested cyber importers, Washington should treat its robust transparency and threat reporting landscape as a competitive advantage. Clear requirements for vulnerability disclosure, incident reporting, and model behavior raise the global bar in ways Chinese providers struggle to match.  

These advantages will only become more important as Chinese state-sponsored cybercrime accelerates in speed and scale; not just against the United States, but against its enemies, neighbors, and global partners alike. To fight back with a united front, the U.S. and its partners and allies should send U.S. industry leadership in cybersecurity to the front lines. 

We don’t need to emulate Beijing’s playbook to win the AI race, we need to double-down on our own. If Washington leans into these opportunities, U.S. AI and cloud cybersecurity firms will set the standards of the rest of the world: standards that promote security, resilience, and trust, and ultimately galvanize adoption and deployment of U.S. technologies. 

David E. Wade was Chief of Staff to the U.S. Department of State and is a Life Member of the Council on Foreign Relations.  Courtney Manning is the Director of the American Security Project’s AI Imperative 2030 focused on the U.S. winning the AI competition with China.