America’s industry began with a young man carrying banned British machines in his memory.
In 1789 a young English mill apprentice named Samuel Slater sailed for America with no drawings in his luggage. British law forbade the export of textile machinery designs and the emigration of the skilled workers who knew them, so Slater carried the designs in his head. In 1790 he built the first successful water-powered cotton-spinning mill in the United States. Americans remember him as the “Father of the American Industrial Revolution.” America built its industrial base on stolen blueprints.
Today Americans describe Chinese technology transfer as theft, and often as something peculiarly Chinese. So which is it: a hero’s founding act, or a crime? The answer depends less on what was done than on who is doing it, and at what stage of their development.
How America caught up
Slater was not an isolated case. The US did not initially respect foreign patents. Until the Patent Act of 1836, European inventors found it nearly impossible to enforce their patents in America, and there were no international IP agreements to appeal to. American companies legally replicated European technologies and processes without repercussion. At World’s Fairs, the US showcased inventions “heavily inspired” by European technologies as original American inventions. The Europeans were furious.
From the British side, the US looked like an opportunistic nation leveraging its lack of formal IP protections to bolster its own industrial base, undermining the investments of European innovators. Britain tried to stop it with export controls on machinery and skilled workers. It failed, because a design that lives in a worker’s memory cannot be held at a port.
The same story, recast
Now replace “United States” with “China,” “Britain” with “United States,” and “textile machinery” with “semiconductor designs.” The narrative, the moral outrage and the economic logic all carry over. China’s economic model used state-directed investment, financial repression and technology transfer, voluntary and otherwise, to catch up, much as the US used patent non-enforcement, industrial espionage and tariff protection to catch up with Britain. Japan copied American manufacturing, and South Korea copied Japanese electronics, in the same way.
The pattern recurs because no civilization bootstraps from first principles; as cultural evolution shows, knowledge spreads by being copied between cultures. The catching-up economy will appropriate. The real question is how the leader responds when it does, and the usual response is to discover that copying is immoral. The rules were written by the winners after they finished winning using the methods they now prohibit.
None of this makes the outrage fake. Britain’s fury at American copying was genuine, and America’s fury at Chinese copying is genuine; the inventor whose work is taken loses something real either way. But IP protection and IP appropriation are both rational strategies at different stages of development, and the moral framing around each is always generated by whoever benefits from that framing at that moment. The fury does not change the fact that catch-up economies copy and incumbents protect.
America now tries to slow China with export controls on semiconductors and chip-making equipment, as Britain once tried to slow America with controls on spinning machinery. Britain could not stop one apprentice with a good memory. Whether controls work better against chips, which take whole industries to make rather than one remembered machine, remains to be seen.
References:
- Samuel Slater and the American textile industry
- Patent Acts of 1790 and 1836
- Great Exhibition of 1851, Centennial Exhibition of 1876