How? Jörg Wuttke, a former longtime president of the E.U. Chamber of Commerce in China, calls it “the China fitness club,” and it works like this:
China starts with an emphasis on STEM education — science, technology, engineering and math. Each year, the country produces some 3.5 million STEM graduates, about equal the number of graduates from associate, bachelor’s, master’s and Ph.D. programs in all disciplines in the United States.
When you have that many STEM graduates, you can throw more talent at any problem than anyone else. As the Times Beijing bureau chief, Keith Bradsher, reported last year: “China has 39 universities with programs to train engineers and researchers for the rare earths industry. Universities in the United States and Europe have mostly offered only occasional courses.”
And while many Chinese engineers may not graduate with M.I.T.-level skills, the best are world class, and there are a lot of them. There are 1.4 billion people there. That means that in China, when you are a one-in-a-million talent, there are 1,400 other people just like you.
As important, Chinese vocational schools graduate tens of thousands of electricians, welders, carpenters, mechanics and plumbers every year, so when someone has an idea for a new product and wants to throw up a factory, it can get built really fast. You need a pink polka dot button that can sing the Chinese national anthem backward? Someone here will have it for you by tomorrow. It will also get delivered fast. Over 550 Chinese cities are connected by high-speed rail that makes our Amtrak Acela look like the Pony Express.
And when you relentlessly digitize and connect everything to everything, you can get in and out of your hotel room fast with just facial recognition. Tech-savvy beggars who carry printouts of QR codes can accept donations fast by the scan of a cellphone. The whole system is set up for speed — including if you challenge the rule of the Communist Party, in which case, you will be arrested fast, given the security cameras everywhere, and disappear fast.
If we don’t build a similar fitness club behind any tariff wall, we’ll get just inflation and stagnation. You cannot tariff your way to prosperity, especially at the dawn of A.I.
I was also in China four months ago. Between then and now, China’s A.I. innovators demonstrated their ability to grow their own open-source A.I. engine, DeepSeek, with far fewer specialized U.S. chips. I could feel the mojo in the tech community. It was palpable. Last month Premier Li Qiang said at the opening ceremony of the National People’s Congress that the Chinese government is supporting “the extensive application of large-scale A.I. models.”
A young Chinese auto engineer who once worked for Tesla here told me: “Now everyone is competing over how much A.I. is being inserted. Now you brag about how much A.I. you insert. Everyone is committed. ‘I will use A.I., even if I don’t know how right now.’ You are preparing for that, even if you are on a simple production line for manufacturing refrigerators. ‘I have to use A.I., because my boss told me to.’”
Attention, Kmart shoppers: When you already have a manufacturing engine as powerful and digitally connected as China’s and then you infuse it with A.I. at every level, it’s like injecting a stimulant that can optimize and accelerate every aspect of manufacturing, from design to testing to production.
Not a good time for U.S. lawmakers to be shunning visits to China for fear of being called panda huggers.
As Han Shen Lin, an American who works as the China country director for the Asia Group, put it to me over breakfast at Shanghai’s Peace Hotel, “DeepSeek should not have been a surprise.” But, he continued, with all the new U.S. “overseas investment restrictions and disincentives to collaborate, we are now blind to China tech developments. China is defining the tech standards of the future without U.S. input. This will put us at a serious competitive disadvantage in the future.”


