((PLAYBOOK SLUG: Inside Story: Competing With China
HEADLINE: Inside Story: Competing With China
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PUBLISHED AT: TBD
BYLINE: Kane Farabaugh
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DATELINE: Indianapolis, Indiana
VIDEOGRAPHER: Adam Greenbaum
PRODUCER: Kane Farabaugh
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VIDEO SOURCE (S): VOA
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((ON CAMERA KANE FARABAUGH))
Thanks for joining us on The Inside Story, I’m VOA Midwest correspondent Kane Farabaugh.
China has the world’s second largest economy behind the United States, and both countries are competing for global dominance.
That competition is punctuated by increasing tensions between the two powers, and this week’s episode of the Inside Story focuses on how that competition is playing out around the world.
((VO))
We begin in the United States, where some U.S. lawmakers are urging legislation to curb sales of U.S. agricultural land to foreign entities, specifically China.
Of more than 100 countries with U.S. land investments, China ranks 18th in holdings.
While concerns about China securing U.S. farmland resound in Congress, experts say it’s more a political issue than a practical one.
((NARRATOR))
One of the United States' top producers of corn and soybeans is the state of Illinois, where Wendell Shauman farms land his family has owned for generations near the city of Galesburg.
He says he’s worried about Chinese investors purchasing farmland like his.
From 2019 to 2020, companies with shareholders connected to China increased their overall U.S. land holdings by nearly 30 percent.
((Wendell Shauman, Illinois Farmer))
23:27:50 “It’s uncomfortable having your major competitor and a guy, an outfit that is shaking their saber at you all the time, here to own land here. That makes you nervous.”
((NARRATOR))
But Shauman admits he doesn’t know any farms nearby connected to China.
((Wendell Shauman, Illinois Farmer))
23:26:47 “I don’t know of any in this area.”
((NARRATOR))
In Jacksonville, Illinois, Luke Worrell’s company manages land transactions throughout the region.
((Luke Worrell, Worrell Land Services)) [[website says he's a co-owner, if you care to add that to chyron. I don’t think it's needed. https://worrell-landservices.com/about-us/]]
22:22:55 “In fifteen years, I’ve never even had communication with an investment group that I’ve known to be Chinese.”
((NARRATOR))
He says most of the transactions he’s involved with stay local.
((Luke Worrell, Worrell Land Services))
22:21:50 “In my fifteen-year career, I’ve never sold a farm to any international buyer.”
((NARRATOR))
Iowa Republican Senator Joni Ernst is among lawmakers calling Chinese ownership of American farms a threat.
[[ https://twitter.com/SenJoniErnst/status/1638656232499322880 ]]
[[ https://twitter.com/SenJoniErnst/status/1623729445059149829?lang=en ]]
According to the U.S. Agriculture Department [a U.S. Department of Agriculture 2021 report?], Chinese-connected investors own less than 162,000 hectares [[400,000 acres]] of land in the U.S. — only a fraction of which is farmland.
((Bruce Sherrick, University of Illinois Agricultural Economics Expert))
21:25:24 “China owns almost no farmland in the United States.”
((NARRATOR))
Bruce Sherrick is a professor of agricultural and consumer economics at the University of Illinois. Of hundreds of millions of hectares of U.S. agricultural lands owned by foreign entities, Sherrick says Chinese ownership barely registers.
((Bruce Sherrick, University of Illinois Agricultural Economics Expert))
21:27:10 “Less than one percent.”
((NARRATOR))
Recent efforts by Chinese-connected investors to buy land near military installations in Texas and North Dakota have fueled concerns about national security risks. But Sherrick says foreign-owned properties are typically managed or tended to by local entities, often American farmers.
((Bruce Sherrick, University of Illinois Agricultural Economics Expert))
21:28:14 “The land producing things doesn’t know who owns it. So I think as a matter of agriculture policy it’s probably not a big deal who owns it.”
((NARRATOR))
Sherrick adds farmland remains an attractive investment for any potential buyer.
((Bruce Sherrick, University of Illinois Agricultural Economics Expert))
21:28:25 “It’s positively correlated returns with inflation no matter how we parse up the data through time. A very high average returns through time, and very low systemic risk.”
((NARRATOR))
In Streator, Illinois, farmer David Isermann also doesn’t know of any land near him owned by foreign investors.
((David Isermann, Illinois Farmer))
23:06:07 “For me, it’s a non-issue.”
((NARRATOR))
While he’d prefer local ownership over Chinese investment, Isermann doesn’t see a need for legislation limiting foreign land ownership.
((NARRATOR))
Wendell Shauman disagrees.
((Wendell Shauman, Illinois Farmer))
23:36:50 “In rural America, I think there would be a lot of support for this. // 23:35:29 “I just as soon not have China come in and throw money around and who knows doing whatever else. I’m not a fan of China.”
((NARRATOR))
Beyond any action Congress might take, a number of state legislatures are also considering restricting foreign land ownership.
((KANE FARABAUGH ON CAMERA))
The 2020 global coronavirus pandemic and the impact on the global supply chain underscored issues related to U.S. reliance on foreign made electronic chips, manufactured mostly in Asia.
The administration of U.S. President Joe Biden is focused on ramping up U.S. microchip production.
VOA’s White House correspondent Anita Powell reports from Washington, with reporter Levi Stallings in Flagstaff, Arizona report on a $6.6 billion U.S. grant to Taiwan’s top chip manufacturer for semiconductor manufacturing in Arizona, which includes a third facility that will bring the tech giant’s investment in the state to $65 billion.
((NARRATION))
A single semiconductor transistor is smaller than a grain of sand.
But billions of them, packed neatly together on a chip can connect the world, control weapons of war, and, someday, even drive your car.
((NARRATION))
But U.S. production of this American-born technology has fallen off in recent decades.
((Andy Wang, Northern Arizona University))
“As a nation, we used to produce 40% of microchips for the whole world. Now we produce less than 10%.”
((NARRATION))
The Biden administration announced $6.6 billion in funding for the world’s top chipmaker to build a third facility in the state of Arizona.
Taiwan Semiconductor Manufacturing Company says it will put the U.S. on track to produce 20 percent of the world’s leading-edge semiconductors by the end of this decade.
The funding comes from the bipartisan 2022 CHIPS and Science Act, which President Joe Biden highlighted that year in a visit to TSMC’s first Arizona facility.
((President Joe Biden)) ((add date in upper right: December 6, 2022))
"American manufacturing is back, folks, American manufacturing is back."
((NARRATION))
Engineers say the legislation addresses a key weakness in American chip manufacturing.
((Todd Achilles, University of California, Berkeley)) ((ZOOM))
“We’ve just gotten in the cycle of the last 15 to 20 years, where innovation has slowed down. It’s all about financial results, investor payouts, and stock buybacks, and we’ve lost that innovation muscle. And the CHIPS Act, pulling that together with the CHIPS Act is the perfect opportunity to restore that.”
((NARRATION))
But, they say, America urgently needs talent. The White House says this new investment could create 25,000 construction and manufacturing jobs. Are there enough workers to feed this need?
((Zachary Holman, Arizona State University)) ((ZOOM))
“Our engineering college is the largest in the country, with over 33,000 enrolled students, and still we’re hearing from companies across the semiconductor industry that they’re not able to get the talent they need in time."
((NARRATION))
TSMC in 2022 broke ground on a facility that makes some of the world's most advanced chips.
With each jump, chip production can get more and more complex and expensive.
Can the country that made the mighty chip keep up? Biden’s betting on it.
((For Levi Stallings in Flagstaff, Arizona, Anita Powell, VOA News, Washington))
((INTRO))
[[Arizona isn’t the only state benefitting from U.S. government efforts to ramp up microchip production. Indiana is a state with a proud history of recreational vehicle and automotive manufacturing, which now aspires to become the next great technology center in the country.))
((NARRATOR))
In 1990, the U.S. produced about 40% of the world’s semiconductors. As manufacturing migrated to Asia, U.S. production fell to about 12%.
Mark Lundstrom has worked with semiconductors - or microchips critical to modern electronics - much of his life, and believes they were underappreciated until there was a shortage.
((Mark Lundstrom, Purdue University Acting Dean of Engineering))
05:24:45 “During Covid we got a wake-up call.”
((NARRATOR))
The 2020 coronavirus pandemic slowed production in Asia, creating a ripple through the global supply chain and leading to shortages of everything from phones to vehicles. U.S. reliance on foreign chip manufacturers exposed a major weakness.
(Mark Lundstrom, Purdue University Acting Dean of Engineering))
05:25:02 “We know that AI is going to transform society in the next several years. It requires extremely powerful chips, the most powerful, leading-edge chips.”
((NARRATOR))
Lundstrom is the Acting Dean of Engineering at Purdue University in Lafayette, Indiana, historically a leader in semiconductor research, which has new importance in the emerging field of artificial intelligence.
((Mark Lundstrom, Purdue University Acting Dean of Engineering))
“If we fall behind in AI, the consequences are enormous for the defense of our country. For our economic future.”
((Zhihong Chen, Purdue University Birck Nanotechnology Center (female, ENG)))
06:00:46 “The key metrics of the performance of the chips, actually, are the size of the transistors.”
((NARRATOR))
Zhihong Chen is director of Purdue’s Birck Nanotechnology Center, which boasts what it calls the “cleanest room in the world,” where engineers work around the clock to push microchip technology into the future and smaller is better.
((Zhihong Chen, Purdue University Birck Nanotechnology Center (female, ENG)))
06:00:46 “We are talking about a few atoms in each silicon transistor these days. // We are trying to make the next-generation transistors better devices than current technologies.”
((NARRATOR))
Purdue’s efforts, along with those of other university campuses in the state, have boosted Indiana’s profile as an attractive location for manufacturers looking to build new microchip facilities.
Eric Holcomb, Indiana’s Republican governor, is working to transform the state beyond its agricultural and automotive manufacturing legacy.
((Eric Holcomb, Indiana Governor))
23:24:09 “If we want to compete globally, we have to get smarter and healthier and more equipped.”
((NARRATOR))
Holcomb’s vision is shared by other lawmakers, including U.S. Senator Todd Young of Indiana, who co-sponsored the bipartisan 2023 CHIPS and Science Act, which commits more than $50 billion in federal funding for domestic microchip development. Indiana is now home to one of 31 designated U.S. technology and innovation hubs, helping it qualify for hundreds of millions of dollars in grants designed to attract technology-driven businesses.
((Eric Holcomb, Indiana Governor))
23:18:42 “We understand that economic development, economic security and national security complement one another.”
((NARRATOR))
The efforts are paying off. South Korean microchip manufacturer SK Hynix announced it was planning to build a $4 billion dollar facility near Purdue that would produce next-generation, high bandwidth memory chips critical for artificial intelligence applications. The facility, slated to start operating in 2028, could create over 1,000 new jobs. While U.S. chip manufacturer SkyWater also plans to invest nearly $2 billion in Indiana near Purdue, the state recently lost bidding to host chip maker Intel, which selected Ohio for two new factories.
((Mark Lundstrom, Purdue University Acting Dean of Engineering))
05:31:55 “Companies tend to like to go to locations where there is already that infrastructure where that supply chain is in place. That’s a challenge for us.”
((NARRATOR))
What could give Indiana a competitive edge is its natural resources – plenty of land and water and regular weather patterns crucial for the processes needed for large-scale microchip manufacturing.
(KANE FARABAUGH ON CAMERA))
One of the individuals driving Indiana’s economic transformation to help the U.S. compete with China is the state’s Republican Governor, Eric Holcomb, featured in the previous report.
We had an opportunity to sit down with Holcomb at the Governor’s office here in the state capitol of Indianapolis to discuss his hopes for Indiana in helping the U.S. maintain a competitive edge.
((2 CAMERA INTERVIEW WITH HOLCOMB, TRANSCRIPTION NEEDED))
((KANE FARABAUGH ON CAMERA))
[[China is now among the nations that have landed a spacecraft and rover on Mars, and is planning to increase its footprint on the heavens. But instead of competing with China in a new “space race”, some hope it could spark renewed interest in human spaceflight, and advance exploration of the cosmos.]]
((NARRATOR))
The steady stream of data Edwin Kite reviews from U.S. and Chinese rovers simultaneously exploring the surface of Mars keeps him busy at his University of Chicago laboratory.
((Edwin Kite, Planetary Geoscientist))
“You can quickly go through a loop of making a discovery, forming a hypothesis based on that discovery and sending a new spacecraft to test it.”
((NARRATOR))
Gathering information in Kite’s field of study had traditionally been accomplished using telescopes and analyzing meteors and the few moon rocks U.S. astronauts brought to Earth in the 1960s and '70s.
But the new Mars missions are helping Kite and his colleagues obtain a more direct and complete understanding of Mars, thanks to the information the craft and rovers from the different countries have collected throughout the red planet.
((Edwin Kite, Planetary Geoscientist))
((17:51)) “We’re in a really early phase of Mars exploration. We’ve only scratched the surface of what there is to discover. We don’t know which country’s investigation is going to stumble over something that unlocks the next stage of exploration..”
((NARRATOR))
During a U.S. House of Representatives appropriations hearing // NASA Administrator Bill Nelson, a former astronaut and former U.S. senator from Florida, signaled alarm at the recent success of the Chinese space program, which he says isn’t confined to the red planet.
((Bill Nelson, NASA Administrator)) ((YouTube))
“They say that they want to put international contributions into an experimental place on the south pole of the moon. Of course my concern is that they don’t get there first and then say this is our area and you stay out. Because the south pole of the moon is an important part because we think there is water there and if there is water then there is rocket fuel and that is one reason we are going to the South pole of the moon.”
((NARRATOR))
Which is why Nelson is urging lawmakers to support NASA’s Artemis program, which plans to return humans — including the first woman — to the moon, with Mars as an eventual destination.
Nelson says China is on a similar path.
((Bill Nelson, NASA Administrator)) ((YouTube))
“China does, tries, but is not nearly as successful as we are because they are much more secretive in their space program.”
((Rocky Kolb, Astronomy and Astrophysics Professor))
((50:25)) “China is gaining rapidly on the U.S., and the Europeans are also in this space race.”
((NARRATOR))
Rocky Kolb, a professor of astronomy and astrophysics at the University of Chicago, believes a new space race could be positive.
Kolb would like to see the U.S. and Chinese space programs collaborate rather than compete.
((Rocky Kolb, Astronomy and Astrophysics Professor))
((53:20)) “There’s a lot of talent in China that we could make use of, and a lot of resources in China, and they have a lot of money to explore space. And I think this is something that mankind should do together.”
((NARRATOR))
But both Kite and Kolb acknowledge there is a limit to how much cooperation can realistically occur between the United States and China.
((Rocky Kolb, Astronomy and Astrophysics Professor))
((51:39)) “So the technology involved in the peaceful exploration of space can also be transported to military uses.”
((Edwin Kite, Planetary Geoscientist))
((16:01)) “There are legal barriers to bilateral collaboration between NASA and the Chinese space program. But those don’t apply to non-NASA funded work by academic institutions.”
((NARRATOR))
Which is why Kite and Kolb and the members of the global scientific community they represent continue to pore over the tantalizing clues relayed from Mars in an effort to better understand the origins of our own planet and species — knowledge that Kolb says isn’t confined to national borders.
((Rocky Kolb, Astronomy and Astrophysics Professor))
54:00 “I think it would be great in the future if the U.S. could cooperate with China in the same way that now we cooperate with European observatories and the European Space Agency. It adds a lot to the table. There’s a lot of talent in China that we could make use of, and a lot of resources in China, and they have money to explore space. And I think this is something that mankind should do together. And hopefully in the next few years we’ll have a better relationship in science and we will do it together. There is only one Mars. It doesn’t belong to the U.S., and it doesn’t belong to China.”
((KANE FARABAUGH ON CAMERA))
In our final story on this episode of the Inside Story will focus now on a hastily arranged all-expenses-paid trip to China for students from the Iowa town of Muscatine, invited to the country by Chinese President Xi Jinping’s in his effort to welcome as many as 50,000 U.S. students to his country.”
((NARRATOR))
Muscatine, Iowa, high school student Cole Loos had never traveled beyond the United States when he was asked in January: Would you like to go to China?
((Cole Loos, Muscatine High School Student))
21:43:25 "I was lucky I had my passport to go.”
((NARRATOR))
The invitation wasn’t for a date in the distant future. Loos and 24 other students from his high school had less than ten days to commit to the trip and prepare to fly.
((Cole Loos, Muscatine High School Student))
21:42:20 “It was very spontaneous.”
((NARRATOR))
Spontaneous, but by no means an accident.
((NARRATOR))
In 1985, Sarah Lande hosted a group from China in Muscatine for several days on an agricultural research tour of the U.S. One of the participants was Xi Jinping, now president of the People’s Republic of China. Lande helped organize his stay in Muscatine.
((Sarah Lande, Befriended Chinese Leader))
22:54:00 “Good things happen when you are a good friend to people, I guess.”
((NARRATOR))
In 2012, Xi returned to Muscatine, visiting his “old friends” from Iowa in Lande’s living room.
Then last November, Lande attended a dinner on the sidelines of the Asia-Pacific Economic Cooperation summit in San Francisco. In his remarks at the event, Xi expressed his desire to welcome thousands of American students to China, prompting Lande to follow up with a letter to her “old friend.”
((Sarah Lande, Befriended Chinese Leader))
22:51:49 “And I got a reply to that letter, and I said — I hope Muscatine could be a part of this. So, that probably was the incentive for this invite.”
((NARRATOR))
Xi’s offer of an all-expenses-paid trip to China came with few strings attached. The Muscatine students and staff spent eight days visiting with local Chinese students, touring the Great Wall of China and other landmarks and cities, and participated in a conference for students learning the Mandarin language. Loos says it was hard to find any sign of U.S.-China tensions.
((Cole Loos, Muscatine High School Student))
21:51:44 “You felt very special over there.”
((Heidi Kuo, Muscatine High School Mandarin Chinese Teacher))
22:39:07 “Actually I'm very very proud of them. Seems like they grew super-fast in a few days.”
((NARRATOR))
Heidi Kuo, originally from Taiwan, teaches Mandarin at Muscatine High School and accompanied the students to China. Of the many lessons they learned, she hopes one stands out.
((Heidi Kuo, Muscatine High School Mandarin Chinese Teacher))
22:41:25 “The world is super big, not only us here.”
((Ann Edkin, Muscatine High School Teacher))
22:13:30 "That is mind blowing."
((NARRATOR))
Ann Edkin grew up in Muscatine, a city of about 23,000 on the banks of the Mississippi River. She now teaches at Muscatine High School and was one of four staff who made the trip to China. The connection between her community and China’s leader is a baffling but welcome relationship.
((Ann Edkin, Muscatine High School Teacher))
22:13:35 “The fact that he came here, that’s cool. But to have that ongoing relationship, it’s not just a blip, but a continuing relationship that makes it so unique and special.”
((NARRATOR))
As more students prepare for more trips to China, Lande’s next goal is to encourage her “old friend” to return to Muscatine, which she thinks is perfect for a future summit with U.S. President Joe Biden.
((Sarah Lande, Befriended Chinese Leader))
23:22:37 “Muscatine would welcome it!”
((NARRATOR))
A potential venue could be the Muscatine home where Xi stayed in 1985, now preserved as a museum … mostly visited by Chinese tourists.
((KANE FARABAUGH ON CAMERA))
“Thanks for joining us on the Inside Story.
You can connect with us on Instagram and Facebook @voanews.
You can also visit our website any time at voanews.com.
Catch up on past episodes at our free streaming service, VOA Plus.
I’m Kane Farabaugh, and we’ll see you next week on The Inside Story.”
