American AI has reached its Sputnik moment

In fall 1957, Americans looked up at the stars and were able to see with the naked eye a real-time reminder that the Soviet Union was taking the lead in space. Nikita Khruschev successfully launched Sputnik, the first artificial Earth satellite. 

Sixty-seven years later, you don’t have to look up for a wakeup call that the new great power sprint for innovation — competition with China over artificial intelligence — is as contested as it is consequential. 

A Chinese firm just rolled out “DeepSeek.” It is supposed to be a “reasoning model” on par with American technology, except that it refuses to acknowledge inconvenient historical facts or conundrums ranging from the Tiananmen Square massacre to a potential invasion of Taiwan. 

This is AI’s Sputnik moment, and it underscores why the incoming administration must wrestle with this issue, which will shape the future. Adversaries such as Vladamir Putin salivate at the prospect of a world where the most advanced technology is driven not by Silicon Valley’s innovative spirit, but by Beijing’s civil-military fusion strategy.  

How will we respond? 

AI is the most critical geopolitical battleground of this century, and revisionist powers know it. The warnings hide in plain sight; China is exploiting the U.S. innovation ecosystem to align its technological investments with its broader strategic ambitions and has set a goal to lead the world in AI by 2030. 

Russian President Vladimir Putin has been even more forthright, warning allies and adversaries alike that the country that leads in AI “will become ruler of the world.”  

Putin may have malign insights into this technology’s world-shaping potential, but Xi has a strategy to seize it. 

Beijing’s embrace of civil-military fusion, protectionism and state-driven capitalism allow for rapid technological advances at the expense of human rights and the rule of law. It has funneled massive public and private resources into AI development, with unmistakable results as we arrive at the midpoint of Xi’s 2030 goal for global technology supremacy.  

China has succeeded in creating 230 large language models, and trails only the U.S. in global computation capacity. The country’s 2025 target of 300 EFLOPs — a measure of a supercomputer's performance, gauging one quintillion floating-point operations per second — is well within sight. The Beijing Academy for AI has become a hub for rapid innovation and coordination among the companies and state entities that supercharge China’s technological ecosystem. 

Equally notable are the dystopian ways in which the authoritarian surveillance state tests its models. Unrestrained by Western notions of privacy or liberty, Chinese datasets and applications can be rapidly refined — their machine learning made “smarter” — through inhumane testing on a billion disenfranchised people onto whom facial, voice and even ethnic recognition technologies are already widely deployed.  

Artificial intelligence is changing day-to-day life and government capacities, an exponentially increasing force multiplier, driving innovation in everything from advanced defense systems to intelligence and cybersecurity. In other words, it is already critical infrastructure.  

Just as the U.S. played an outsized role in shaping international norms at previous historical hinge points, we must do so again. Such was the case during the aftermath of World War II when state and economic institutions worked in tandem to forge new technological revolutions and win the world 75 years of peace.  

Those enduring rules of the road are an inspiration, but we no longer live in that Long Peace. 

The United States was an economic giant without peers uniquely poised to help a world in rubble dig itself out from global conflagration. Our closest competitor and ideological rival, the Soviet Union, was determined to export its ideology but also bureaucratically sclerotic, predominantly agrarian and weakened by 27 million casualties. 

Even as the U.S. mastered the world-altering discovery of the period, the Soviets leveraged civil-military fusion to develop their own atomic bomb within five years. 

Today, the competition for AI superiority is as fierce as it is fast-moving, and Beijing’s track record as a determined and nimble innovator far exceeds the capability of the Soviets back then. We don’t have any margins to be complacent. 

The U.S. likely still has a narrow technological edge, but our lead is far from self-sustaining. We need to hone that edge if we are going to pull non-aligned states closer to us and convince them that thriving under our digital umbrella — and adopting our respect for privacy, human rights and responsible use cases — is worth it to gain enormously from the superior transformative technological benefits we offer. 

The incoming administration will be responsible for bringing together government and private industry in a policy ecosystem that protects American innovation while ensuring the world’s most exciting AI technologies are developed, shared and used responsibly with allies and partners. 

The repercussions for security and governance will ripple for generations.  

David Wade, former chief of staff to the U.S. Department of State and board member of the American Security Project, is a life member of the Council on Foreign Relations.