# US and China build rival AI empires that extend geopolitical power

Digest AI · Policy & Regulation · published 2026-10-22T07:15:01Z

Canonical: https://digestai.news/story/us-and-china-build-rival-ai-empires-that-extend-geopolitical-power

## Summary

The essay argues that artificial intelligence has become an imperial technology, allowing the United States and China to extend their existing geopolitical influence. Both powers control the key inputs—large language models, advanced chips, data centers, and capital—that underpin frontier AI, turning the technology into a lever over global innovation, science, and culture.

China’s State Council set a 2030 AI leadership plan in 2017 and, according to a Bloomberg draft, now intends to spend $295 billion over five years on a state‑run data‑center network financed by long‑dated bonds. The United States relies on private‑sector finance; the largest tech firms have pledged more than $600 billion to AI‑related capital spending in 2026, funded largely through public and private credit markets. The fiscal strain is evident as the US paid roughly $881 billion in interest in 2024—exceeding its defense budget of about $874 billion—highlighting the growing “imperial trilemma” of funding, defense, and welfare.

The piece warns that the race for AI dominance could trigger financial crises, geopolitical splits over chips and models, and even security threats from autonomous AI agents, making the technology a decisive factor in future global power balances.

## Key points

- Beijing plans to spend $295 billion over five years on a nationwide AI data‑center grid, funded mainly by government bonds (Bloomberg June).
- US tech firms have committed more than $600 billion to AI‑related capital expenditure in 2026, largely via private credit markets.
- The United States paid roughly $881 billion in interest in 2024, exceeding its defense spending of about $874 billion.

## Why it matters

The analysis shows how AI’s resource demands turn it into a geopolitical lever, shaping competition, debt risks, and global tech standards.

## Sources

1. [How AI is an inherently imperial technology, and how the US and China are building rival "AI empires" with different approaches to extend their power](https://foreignaffairs.com/china/empires-artificial-intelligence-ferguson-klaassen-schmidt) (foreignaffairs.com, 2026-10-22)

Part of the developing story: [The Bipolar AI Empire Race](https://digestai.news/thread/china-leads-in-ai-researchers-and-publications-but-trails-us-in-compute-and) (2 stories)

## Cite

Digest AI, "US and China build rival AI empires that extend geopolitical power", 22 October 2026, https://digestai.news/story/us-and-china-build-rival-ai-empires-that-extend-geopolitical-power

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