Why The Pentagon Can’t Count: It’s Time to Reinvent the Audit

This article previously appeared in War on the Rocks.

In the past, headlines about the Pentagon failing its financial audit again would never have caught my attention. But having been in the middle of this conversation when I served on one of the Defense Department’s advisory boards, I understand why the Pentagon can’t count. The experience taught me a valuable lesson about innovation and imagination in large organizations, and the difference visionary leadership – or the lack of it – can make.

With audit costs approaching a billion dollars a year the Pentagon had an opportunity to lead in modernizing auditing. Instead it opted for more of the same.

Auditing the Department of Defense
By law, the Department of Defense has to provide Congress and the public with an assessment of where it spends its money and to provide transparency of its operations. A financial audit counts what the Department of Defense has, where it has it, and if they know where its money is being spent.

Auditing the Department of Defense is a massive undertaking. For one thing, it is the country’s largest employer, with 2.9 million people (1.3 million on active duty, 800,000 in the reserve components, and 770,000 civilians.) The audit has to count the location and condition of every piece of military equipment, property, inventory, and supplies. And there are a lot of them. The department has 643,900 assets, from buildings, to pipelines, roads, and fences located on over 4,860 sites, as well as 19,700 aircraft and over 290 battle force ships. To complicate the audit, the department has 326 different and separate financial management systems, 4,700 data warehouses and over 10,000 different and disconnected data management systems.

(BTW, just like in the private sector, financial audits and audits of contracts are separate. While the DoD Office of Inspector General is responsible for these financial audits of trillions of dollars of assets and liabilities, the Defense Contract Audit Agency is responsible for auditing the hundreds of billions of dollars of acquisition contracts. They have the same issues.)

This is the fifth year the Department has undergone a financial statement audit – and failed it. The audit was not a trivial effort, it required 1,600 auditors – 1,450 from public accounting firms and 150 from the Office of Inspector General. In 2019, the audit cost $428 million in auditing costs ($186 million to the auditors along with $242 million to audit support) and another $472 million to fix the issues the audit discovered.

Let’s Invent the Future of Audit
The Defense of Department’s 40-plus advisory boards are staffed by outsiders who can provide independent perspectives and advice. I sat on one of these boards, and our charter was to leverage private sector lessons to improve audit quality.

With defense spending on auditing approaching a billion dollars a year, it was clear it would take a decade or more to catch up to the audit standards of private companies. But no single company or even entire industry was spending this much money on auditing. And remarkably, the Defense Department seemed intent on doing the same thing year after year, just with more people and with a few more tools and processes to get incrementally better. It dawned on me that if we tried to look over the horizon, the department could audit faster, cheaper, and more effectively by inventing the future tools and techniques rather than repeating the past.

Nothing in our charter asked the advisory board to invent the future. But I found myself asking, “What if we could?” What if we could provide the defense department with new technology, new approaches to auditing, analytics practices, audit research, and standards, all while creating audit and data management research and a new generation of finance applications and vendors?

The Pentagon Once Led Business Innovation
I reminded my fellow advisory board members that in 1959, at the dawn of the computer age, the Defense Department was the largest user of computers for business applications.

However, there was no common business programing language. So rather than wait for one, the Defense Department led the effort to create one – the COBOL programming language. And 20 years later, it did the same for the ADA programming language.

With that history in mind, I proposed we lead again. And that we start an initiative for the 5th generation of audit practices (the Audit 5.0 Initiative) with machine learning, predictive analytics, Intelligent sampling and predictions. This initiative would also include automating ETL, predictive analytics, fraud detection, and a new generation of audit standards.

I pointed out that this program wouldn’t need more funds since the Department of Defense could allocate 10% of the $428M we were spending on auditors and fund SBIR (Small Business Innovation Research) programs in auditing/data management/finance to generate 5-10 new startups in this space each year. Simultaneously we could fund academic research, to incentivize research on Machine Learning as applied to Audit 5.0 challenges in finance, auditing and data management.

In addition, we could create new audit standards by working with existing government audit standards bodies such as (The Generally Accepted Government Auditing Standards (GAGAS), Yellow Book, the GAO’s Standards for Internal Control in the Federal Government, Green Book and the Federal Accounting Standards Advisory Board (FASAB). We could collaborate with civilian audit standard bodies (ASB (Auditing Standards Board) and PCAOB (Public Company Accounting Oversight Board). Working together, the defense department could create the next generation of machine-driven and semiautomated standards. Furthermore, it could help the Independent Public Accounting firms (KPMG, EY, PwC, Deloitte, et al) create a new practice and make them partners in the Audit 5.0 initiative.

By investing 10 percent of the existing auditing budget over the next few years, these activities would create a defense audit center of excellence that would fund academic centers for advanced audit research, standup “future of audit” programs that would create new 5-10 startups each year, be the focal point for government an industry finance and audit standards, and create public-private partnerships rather than mandates.

Spinning up these activities up would dramatically reduce the department’s audit costs, standardize its financial management environment, and provide confidence in their budget, auditability, and transparency. And as a bonus, it would create a new generation of finance, audit and data management startups, funded by private capital.

The Road Not Taken
I was in awe of my fellow advisory board members. They had spent decades in senior roles in finance and accounting in both the public and private sectors. Yet, when I pitched this idea, they politely listened to what I had to say and then moved on to their agenda – providing the DoD with Incremental improvements.

At the time I was disappointed, but not surprised. An advisory board is only as good as what it’s being chartered and staffed to do. If they are being asked to provide a 10 percent incremental advice, they’ll do so. But if they’re asked for revolutionary i.e. 10x advice, they can change the world. But that requires a different charter, leadership, people, innovation, and imagination.

In the end, the Department of Defense, the largest purchaser of accounting services in the world, whiffed a chance to be the leader in creating the next generation of audit tools and services, not only for financial audits, but for the hundreds of billions of dollars of acquisition contracts the Defense Contract Audit Agency audits. By now the department could have audit tools driven by machine learning algorithms, ferreting out fraud by vendors or contractors and anticipating programs that are at risk.

Lessons Learned

  • If you only get what you ask for you haven’t hired people with imagination
    • America’s defense leaders ought to ask and act for transformational, contrarian and disruptive advice
    • And ensure they have the will and organizations to act on it
  • Move requests for advice for incremental improvements to the consulting firms that currently serve the Defense Department
  • Defense leaders need to consider whether spending a billion dollars a year for an audit is causing the department to become appreciably more efficient or better managed
    • Or whether there might be a better way

Lessons for the DoD – From Ukraine and China

 Portions of this post previously appeared in War On the Rocks.


Looking at a satellite image of Ukraine online I realized it was from Capella Space – one of our Hacking for Defense student teams who now has 7 satellites in orbit.

National Security is Now Dependent on Commercial Technology
They’re not the only startup in this fight. An entire wave of new startups and scaleups are providing satellite imagery and analysis, satellite communications, and unmanned aerial vehicles supporting the struggle.

For decades, satellites that took detailed pictures of Earth were only available to governments and the high-resolution images were classified. Today, commercial companies have their own satellites providing unclassified imagery. The government buys and distributes commercial images from startups to supplement their own and shares them with Ukraine as part of a broader intelligence-sharing arrangement that the head of Defense Intelligence Agency described as “revolutionary.” By the end of the decade, there will be 1000 commercial satellites for every U.S. government satellite in orbit.

At the onset of the war in Ukraine, Russia launched a cyber-attack on Viasat’s KA-SAT satellite, which supplies Internet across Europe, including to Ukraine. In response, to a (tweeted) request from Ukraine’s vice prime minister, Elon Musk’s Starlink satellite company shipped thousands of their satellite dishes and got Ukraine back on the Internet. Other startups are providing portable cell towers – “backpackable” and fixed.  When these connect via satellite link, they can provide phone service and WIFI capability. Another startup is providing a resilient, mesh local area network for secure tactical communications supporting ground units.

Drone technology was initially only available to national governments and militaries but is now democratized to low price points and available as internet purchases. In Ukraine, drones from startups are being used as automated delivery vehicles for resupply, and for tactical reconnaissance to discover where threats are. When combined with commercial satellite imagery, this enables pinpoint accuracy to deliver maximum kinetic impact in stopping opposing forces.

Equipment from large military contractors and other countries is also part of the effort. However, the equipment listed above is available commercially off-the-shelf, at dramatically cheaper prices than what’s offered by the large existing defense contractors, and developed and delivered in a fraction of the time. The Ukraine conflict is demonstrating the changing character of war such that low-cost emerging commercial technology is extremely effective when deployed against a larger 20th-century industrialized force that Russia is fielding.

While we should celebrate the organizations that have created and fielded these systems, the battle for the Ukraine illustrates much larger issues in the Department of Defense.

For the first time ever our national security is inexorably intertwined with commercial technology (drones, AI, machine learning, autonomy, biotech, cyber, semiconductors, quantum, high-performance computing, commercial access to space, et al.) And as we’re seeing on the Ukrainian battlefield they are changing the balance of power.

The DoD’s traditional suppliers of defense tools, technologies, and weapons – the prime contractors and federal labs – are no longer the leaders in these next-generation technologies – drones, AI, machine learning, semiconductors, quantum, autonomy, biotech, cyber, quantum, high performance computing, et al. They know this and know that weapons that can be built at a fraction of the cost and upgraded via software will destroy their existing business models.

Venture capital and startups have spent 50 years institutionalizing the rapid delivery of disruptive innovation. In the U.S., private investors spent $300 billion last year to fund new ventures that can move with the speed and urgency that the DoD now requires. Meanwhile China has been engaged in a Civil/Military Fusion program since 2015 to harness these disruptive commercial technologies for its national security needs.

China – Civil/Military Fusion
Every year the Secretary of Defense has to issue a formal report to Congress: Military and Security Developments Involving the People’s Republic of China. Six pages of this year’s report describe how China is combining its military-civilian sectors as a national effort for the PRC to develop a “world-class” military and become a world leader in science and technology. A key part of Beijing’s strategy includes developing and acquiring advanced dual-use technology. It’s worth thinking about what this means – China is not just using its traditional military contractors to build its defense ecosystem; they’re mobilizing their entire economy – commercial plus military suppliers. And we’re not.

DoD’s Civil/Military Orphan-Child – the Defense Innovation Unit
In 2015, before China started its Civil/Military effort, then-Secretary of Defense Ash Carter, saw the need for the DoD to understand, embrace and acquire commercial technology. To do so he started the Defense Innovation Unit (DIU). With offices in Silicon Valley, Austin, Boston, Chicago and Washington, DC, this is the one DoD organization with the staffing and mandate to match commercial startups or scaleups to pressing national security problems. DIU bridges the divide between DOD requirements and the commercial technology needed to address them with speed and urgency. It accelerates the connection of commercial technology to the military. Just as importantly, DIU helps the Department of Defense learn how to innovate at the same speed as tech-driven companies.

Many of the startups providing Ukraine satellite imagery and analysis, satellite communications, and unmanned aerial vehicles were found by the Defense Innovation Unit (DIU). Given that DIU is the Department of Defense’s most successful organization in developing and acquiring advanced dual-use technology, one would expect the department to scale the Defense Innovation Unit by a factor of ten. (Two years ago, the House Armed Services Committee in its Future of Defense Task Force report recommended exactly that—a 10X increase in budget.) The threats are too imminent and stakes too high not to do so.

So what happened?

Congress cut their budget by 20%.

And their well-regarded director just resigned in frustration because the Department is not resourcing DIU nor moving fast enough or broadly enough in adopting commercial technology.

Why? The Defense Ecosystem is at a turning point. Defense innovation threatens entrenched interests. Given that the Pentagon budget is essentially fixed, creating new vendors and new national champions of the next generation of defense technologies becomes a zero-sum game.

The Defense Innovation Unit (DIU) had no advocates in its chain of command willing to go to bat for it, let alone scale it.

The Department of Defense has world-class people and organization for a world that no longer exists
The Pentagon’s relationship with startups and commercial companies, already an arms-length one, is hindered by a profound lack of understanding about how the commercial innovation ecosystem works and its failure of imagination about what venture and private equity funded innovation could offer. In the last few years new venture capital and private equity firms have raised money to invest in dual-use startups. New startups focused on national security have sprung up and they and their investors have been banging on the closed doors of the defense department.

If we want to keep pace with our adversaries, we need to stop acting like we can compete with one hand tied behind our back. We need a radical reinvention of our civil/military innovation relationship. This would use Department of Defense funding, private capital, dual-use startups, existing prime contractors and federal labs in a new configuration that could look like this:


Create a new defense ecosystem encompassing startups, and mid-sized companies at the bleeding edge, prime contractors as integrators of advanced technology, federally funded R&D centers refocused on areas not covered by commercial tech (nuclear and hypersonics). Make it permanent by creating an innovation doctrine/policy.

Reorganize DoD Research and Engineering to allocate its budget and resources equally between traditional sources of innovation and new commercial sources of innovation.

  • Scale new entrants to the defense industrial base in dual-use commercial tech – AI/ML, Quantum, Space, drones, autonomy, biotech, underwater vehicles, shipyards, etc. that are not the traditional vendors. Do this by picking winners. Don’t give out door prizes. Contracts should be >$100M so high-quality venture-funded companies will play. And issue debt/loans to startups.

Reorganize DoD Acquisition and Sustainment to create and buy from new 21st century arsenals – new shipyards, drone manufacturers, etc. that can make 1,000’s of extremely low cost, attritable systems – “the small, the agile and the many.”

  • Acquire at Speed. Today, the average Department of Defense major acquisition program takes anywhere from nine to 26 years to get a weapon in the hands of a warfighter. DoD needs a requirements, budgeting and acquisition process that operates at commercial speed (18 months or less) which is 10x faster than DoD procurement cycles. Instead of writing requirements, the department should rapidly assess solutions and engage warfighters in assessing and prototyping commercial solutions. We’ll know we’ve built the right ecosystem when a significant number of major defense acquisition programs are from new entrants.

  • Acquire with a commercially oriented process. Congress has already granted the Department of Defense “Other Transaction Authority” (OTA) as a way to streamline acquisitions so they do not need to use Federal Acquisition Regulations (FAR). DIU has created a “Commercial Solutions Opening” to mirror a commercial procurement process that leverages OTA. DoD could be applying Commercial Solutions Openings on a much faster and broader scale.

Integrate and create incentives for the Venture Capital/Private Equity ecosystem to invest at scale. The most important incentive would be for DoD to provide significant contracts for new entrants. (One new entrant which DIU introduced, Anduril, just received a follow-on contract for $1 billion. This should be one of many such contracts and not an isolated example.) More examples could include: matching dollars for national security investments (similar to the SBIR program but for investors), public/private partnership investment funds, incentivize venture capital funds with no-carry loans (debt funding) to, or tax holidays and incentives – to get $10’s of billions of private investment dollars in technology areas of national interest.

Buy where we can; build where we must. Congress mandated that the Department of Defense should use commercial off-the-shelf technology wherever possible, but the department fails to do this (see industry letter to the Department of Defense).

Coordinate with Allies. Expand the National Security Innovation Base (NSIB) to an Allied Security Innovation Base. Source commercial technology from allies.

This is a politically impossible problem for the Defense Department to solve alone. Changes at this scale will require Congressional and executive office action. Hard to imagine in the polarized political environment. But not impossible.

Put Different People in Charge and reorganize around this new ecosystem. The threats, speed of change, and technologies the United States faces in this century require radically different mindsets and approaches than those it faced in the 20th century. Today’s leaders in the DoD, executive branch and Congress haven’t fully grasped the size, scale, and opportunity of the commercial innovation ecosystem or how to build innovation processes to move with the speed and urgency to match the pace China has set.


Change is hard – on the people and organizations inside the DoD who’ve spent years operating with one mindset to be asked to pivot to a new one.

But America’s adversaries have exploited the boundaries and borders between its defense and commercial and economic interests. Current approaches to innovation across the government — both in the past and under the current administration —  are piecemeal, incremental, increasingly less relevant, and insufficient.

These are not problems of technology. It takes imagination, vision and the willingness to confront the status quo. So far, all are currently lacking.

Russia’s Black Sea flagship Moskva on the bottom of the ocean and the thousands of its destroyed tanks illustrate the consequences of a defense ecosystem living in the past. We need transformation not half-measures. The U.S. Department of Defense needs to change.

Historically, major defense reforms have come from inside the DoD, at other times Congress (National Security Act of 1947, Goldwater-Nichols Act of 1986) and others from the President (Roosevelt’s creation of the Joint Chiefs in 1942, Eisenhower and the Department of Defense Reorganization Act of 1958.)

It may be that the changes needed are so broad that the DoD can’t make them and Congress needs to act. If so, it’s their time to step up.

Carpe diem. Seize the day.

Technology, Innovation, and Great Power Competition  – Wrap Up

This article first appeared in West Point’s Modern War Institute.

We just had our final session of our Technology, Innovation, and Great Power Competition class. Joe FelterRaj Shah and I designed the class to give our students insights on how commercial technology (AI, machine learning, autonomy, cyber, quantum, semiconductors, access to space, biotech, hypersonics, and others) will shape how we employ all the elements of national power (our influence and footprint on the world stage).

(Catch up with the class by reading our intro to the class, and summaries of Classes 1234, 5 6, 7 and 8.)


This class has four parts that were like most lecture classes in international policy:

  • Weekly Readings – 5-10 articles/week
  • 20+ guest speakers on technology and its impact on national power – prior secretaries of defense and state, current and prior National Security council members, four-star generals who lead service branches
  • Lectures/Class discussion
  • Midterm individual project – a 2,000-word policy memo that describes how a U.S. competitor is using a specific technology to counter U.S. interests and a proposal how the U.S. should respond

The fifth part of the class was unique.

  • A quarter-long, team-based final project. Students developed hypotheses of how commercial technologies can be used in new and creative ways to help the U.S. wield its instruments of national power. And then they got out of the classroom and interviewed 20+ beneficiaries, policy makers, and other key stakeholders testing their hypotheses and proposed solutions.

At the end of the quarter, each of the teams gave a final “Lessons Learned” presentation with a follow-up a 3,000 to 5,000-word team-written paper.

By the end the class all the teams realized that the problem they had selected had morphed into something bigger, deeper and much more interesting.

Team Army Venture Capital

Original problem statement: the U.S. needs to reevaluate and improve its public venture capital relationship with companies with dual-use technologies.

Final problem statement: the DoD needs to reevaluate and improve its funding strategies and partnerships with dual-use mid-stage private companies.

If you can’t see the presentation click here.

We knew that these students could write a great research paper. As we pointed out to them, while you can be the smartest person in the building, it’s unlikely that 1) all the facts are in the building, 2) you’re smarter than the collective intelligence sitting outside the building.

Team Conflicted Capital

Original problem statement: Chinese investment in US startups with critical technologies poses a threat to US military capabilities, but the lack of transparency in venture capital makes it challenging to track them.

Final problem statement: Chinese adversarial venture capital investments in U.S. dual-use startups continue to threaten US military capabilities across critical technologies, but the scope of the problem is relatively small. VCs and entrepreneurs can play a role in addressing the challenge by shunning known sources of adversarial capital.

If you can’t see the presentation click here.

By week 2 of the class students formed teams around a specific technology challenge facing a US government agency and worked throughout the course to develop their own proposals to help the U.S. compete more effectively through new operational concepts, organizations, and/or strategies.

Team Aurora

Original Problem Statement: How can the U.S. employ its cyber capabilities to provide the populace of China with unrestricted Internet access to bolster civil society against CCP crackdowns, in order to pressure the PRC, spread American liberal values, and uphold U.S. freedom of action in the information domain?

Final Problem Statement: How does the USG leverage a soft-power information campaign to support Hong Kong residents’ right to self-determination and democratic governance without placing individuals at undue risk (of prosecution as foreign agents under the National Security Law)?

If you can’t see the presentation click here.

We wanted to give our students hands-on experience on how to deeply understand a problem at the intersection of our country’s diplomacy, information, its military capabilities, economic strength, finance, intelligence, and law enforcement and dual-use technology. First by having them develop hypotheses about the problem; next by getting out of the classroom and talking to relevant stakeholders across government, industry, and academia to validate their assumptions; and finally by taking what they learned to propose and prototype solutions to these problems.

Team ShortCircuit

Original Problem Statement: U.S. semiconductor procurement is heavily dependent on TSMC, which creates a substantial vulnerability in the event a PRC invasion of Taiwan, or other kinetic disruptions in the Indo-Pacific.

Final Problem Statement: How should the U.S. Government augment the domestic semiconductor workforce through education and innovation initiatives to increase its semiconductor sector competitiveness?

If you can’t see the presentation click here. 

We want our students to build the reflexes and skills to deeply understand a problem by gathering first-hand information and validating that the problem they are solving is the real problem, not a symptom of something else. Then, students began rapidly building minimal viable solutions (policy, software, hardware …) as a way to test and validate their understanding of both the problem and what it would take to solve it.

Team Drone

Original Problem Statement: Drones can be used as a surprise element in an amphibious assault to overwhelm defenses. In a potential Taiwan Strait Crisis, there is a need for a low-cost and survivable counter-drone system to defend Taiwan.

Final Problem Statement: Taiwan needs a robust and survivable command and control system to effectively and quickly bring the right asset to the right place at the right time during an invasion.

If you can’t see the presentation click here.

One other goal of the class was testing a teaching team hypothesis – that we could turn a lecture class into one that gave back more in output than we put in. That by tasking the students to 1) use what they learned from the lectures and 2) then test their assumptions outside the classroom, the external input they received would be a force multiplier. It would make the lecture material real, tangible and actionable. And we and they would end up with something quite valuable.

Team Apollo

Original Problem Statement: The Space Force must leverage commercial innovation and establish a trained, experienced acquisition workforce that will deliver innovation impact that the Space Force requires.

Final Problem Statement: The United States Space Force lacks the supply chain and rapid launch capabilities needed to respond to contingencies in space. The private sector possesses these capabilities, but is not being adequately leveraged or incentivized.

If you can’t see the presentation click here. 

We knew we were asking a lot from our students. We were integrating a lecture class with a heavy reading list with the best practices of hypothesis testing from Lean Launchpad/Hacking for Defense/I-Corps. But I’ve yet to bet wrong in pushing students past what they think is reasonable. Most rise way above the occasion.

Given this was the first time we taught integrated lectures and projects our student reviews ranged from the “we must have paid them to write this” to “did they take the same class as everyone else?” (Actually it was, let’s fix the valid issues they raised.)


A few student quotes:

“This is a MUST TAKE [caps theirs]. The professors and teaching team are second to none, and the guest speakers are truly amazing. This course is challenging, but you truly get out of it what you put into it, and you will learn so much crucial and interesting material.”

“THIS IS A FANTASTIC COURSE! [caps theirs]. The material was excellent, the instruction from legendary professions was top notch and the reading material was timely, interesting, and relevant. Anyone who is interested in geopolitics and technology innovation needs to take this course. Not only that, but each week features a different guest speaker that is usually from the highest levels of US government and is THE expert in the subject for that week’s course. Really amazing experience getting to listen to and have Q&A with such incredible people.”


Team Catena

Original Problem Statement: China’s cryptocurrency ban presents the U.S. with an opportunity to influence blockchain development, attract technical talent, and leverage digital asset technology.

Final Problem Statement: CCP’s economic coercion makes countries such as Australia dependent on China’s economy and vulnerable to the party’s will. The U.S. must analyze which key Australian industries are most threatened and determine viable alternative trading partners.

If you can’t see the presentation click here.


A few more student quotes:

“This is hands-down one of the best courses I’ve taken at Stanford. From the moment I walked into the door, I was stunned by both the caliber of people you’re sharing oxygen with in that room, and how welcoming and accessible they are. Despite it being the first offering of this course, everything was well-organized, and our team was always supported with a wealth of resources and access we needed to get our policy deliverables to, alongside a healthy dose of near-constant feedback and encouragement from the teaching team. Readings were engaging and insightful, and the guest list we had was simply unbelievable- Mattis, McFaul, Rice, Pottinger, among several others in the White House, Pentagon, and beyond. There’s a real feeling that everyone who worked on this course wants you to grow as a student but also teach them what you’re learning.

Beware Steve Blank- he can be harsh and aggressive but exemplifies the ‘rude but life-saving doctor’ trope. I’ve learned more from responding to a single Blank cold-question in lecture than from three entire quarters of applied math at Stanford. Be sure to get started early on your teamwork and talk to the lecturers as much as you can- this really is a ‘you get as much as you give’ course, and the highest returns are to be had by being tenacious, loud, and unabashed in your questioning.
And, for God’s sake, don’t draw cartoons on your final presentation- the JCOS might be watching.

“DO NOT TAKE THIS COURSE! This class is a complete waste of time.“

“This was the worst class I took at Stanford “

While the positive feedback accolades for the class were rewarding, several comments identified areas we can improve:

  • Letting the students know upfront the workload and unique format of the class
  • Better organization and timing
    • Readings: be much clearer on which ones are mandatory vs optional
    • Clarify details, flows and objectives for each class
    • Tie speakers to projects / student presentations
  • Make weekly office hours mandatory to ensure all students receive regular professor/student interaction, feedback and guidance from week 1

All of our students put in extraordinary amount of work. Our students, a mix between international policy and engineering, will go off to senior roles in State, Defense, policy and to the companies building new disruptive technologies. They will be the ones to determine what the world-order will look like for the rest of the century and beyond. Will it be a rules-based order where states cooperate to pursue a shared vision for a free and open region and where the sovereignty of all countries large and small is protected under international law? Or will it be an autocratic and dystopian future coerced and imposed by a neo-totalitarian regime?

This class changed the trajectory of many of our students. A number expressed newfound interest in exploring career options in the field of national security. Several will be taking advantage of opportunities provided by the Gordian Knot Center for National Security Innovation to further pursue their contribution to national security.

Lessons Learned

  • We could turn a lecture class into one that gave back more in output than we put in.
  • Tasking the students to test their assumptions outside the classroom, the external input they received was a force multiplier
    • It made the lecture material real, tangible and actionable
  • Pushing students past what they think is reasonable results in extraordinary output. Most rise way above the occasion
  • The output of the class convinced us that the work of students like these could materially add to the safety and security of the free world
  • It is a national security imperative to create greater opportunities for our best and brightest to engage and address challenges at the nexus of technology, innovation and national security

Note: Inspired by our experience with this course, we decided to increase the focus of Stanford’s Gordian Knot Center for National Security Innovation on developing and empowering the extraordinary and largely untapped potential of students across the university and beyond.

Technology, Innovation, and Great Power Competition – Class 8 – Cyber

This article first appeared in West Point’s Modern War Institute.


We just completed the eighth week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape the character and employment of all instruments of national power.

In class 1, we learned that national power is the sum of all the resources available to a state to pursue its national objectives and interests. This power is wielded through a combination of a country’s diplomacy, information, its military capabilities, economic strength, finance, intelligence, and law enforcement. These instruments of national power employed in a “whole of government approach” to advance a state’s interests are known by the acronym DIME-FIL.

Class 2 focused on China, the U.S.’s primary great power competitor. China is using all elements of its national power, e.g. information/ intelligence, its military might and economic strength as well as exploiting Western finance and technology. China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with its own neo-totalitarian model where China emerges as the dominant regional and global power.

The third class focused on Russia, which since 2014 has asserted itself as a competing great power. We learned how Russia pursues security and economic interests in parallel with its ideological aims.

The fourth class shifted our focus to the impact commercial technologies have on the instruments of national power (DIME-FIL). The first technology we examined was semiconductors, and the U.S. dependence on TSMC in Taiwan, for its most advanced logic chips. This is problematic as China claims Taiwan is a province of China.

In the fifth class we examined the impact that AI and Machine Learning will continue to have on the capabilities and employment of DIME-FIL. We heard from the Joint Artificial Intelligence Center (JAIC), the focal point of the DOD AI strategy; and from the Defense Innovation Unit (DIU) – a DoD organization that contracts with commercial companies to solve national security problems.

In class six we discussed unmanned systems and autonomy and how the advent of these weapons will change operational concepts and the face of war.

Class seven looked at the Second Space Age, how our military and civilian economy rely on assets in space, and how space is now a contested environment, with China and Russia capable of disabling/destroying our satellites

Today’s class: Cyber

Catch up with the class by reading our intro to the class, and summaries of Classes 123, 4, 5 6 and 7


 

Required readings

Case Study for Class

Competition in Cyber Space

Cyber Attacks / Cyber Warfare

IP & Protected Personal Information Theft

Political Interference

Reading Assignment Questions

Pick one of the below questions and answer in approximately 100 words, based on the required readings. Please note that this assignment will be graded and count towards course participation. 

  1. What is the U.S. Cyber Command’s doctrinal approach to competing in the cyber domain? Do you agree with the current doctrine? Why or why not? Would you do anything differently?
  2. Of the different types of cyber threats presented in this week’s readings (cyberattacks, PPI and IP theft, and political interference), which do you think presents the greatest threat to U.S. interests and why? What should the U.S do to address that threat? Be specific if your recommendations are for the government or private sector.

Class 8 – Guest Speaker

Dr. Michael Sulmeyer is a Senior Adviser, USCYBERCOM (Cyber Command). He was the former Senior Director for Cyber at the National Security Council. The former Cyber Project Director at the Harvard Kennedy School-Belfer Center. He was a past Director, Plans and Operations, for Cyber Policy in the Office of the Secretary of Defense. Previously, he worked on arms control and the maintenance of strategic stability between the United States, Russia, and China.

Cyber Command formed in 2010 and is one of the eleven unified combatant commands of the United States Department of Defense. It’s commanded by a four-star general, General Paul Nakasone who is also the director of the National Security Agency and chief of the Central Security Service. It has three main missions: (1) defending the DoD information systems, (2) supporting joint force commanders with cyberspace operations, and (3) defending the nation from significant cyberattacks.

Dr. Sulmeyer has written, “A focus on cyber-deterrence is understandable but misplaced. Deterrence aims to change the calculations of adversaries by persuading them that the risks of an attack outweigh the rewards or that they will be denied the benefits they seek. But in seeking merely to deter enemies, the United States finds itself constantly on the back foot. Instead, the United States should be pursuing a more active cyberpolicy, one aimed not at deterring enemies but at disrupting their capabilities. In cyberwarfare, Washington should recognize that the best defense is a good offense.

In countries where technology companies are willing to cooperate with the U.S. government (or with requests from their own government), a phone call to the right cloud provider or Internet service provider (ISP) could result in getting bad actors kicked off the Internet.

U.S. hackers could pursue a campaign of erasing computers at scale, disabling accounts and credentials used by hackers to attack, and cutting off access to services so it is harder to compromise innocent systems to conduct their attacks.”

Our national defense cyber policy has now moved to “persistent engagement.” Defending forward as close as possible to the origin of adversary activity extends our reach to expose adversaries’ weaknesses, learn their intentions and capabilities, and counter attacks close to their origins. Continuous engagement imposes tactical friction and strategic costs on our adversaries, compelling them to shift resources to defense and reduce attacks. We will pursue attackers across networks and systems to render most malicious cyber and cyber-enabled activity inconsequential while achieving greater freedom of maneuver to counter and contest dangerous adversary activity before it impairs our national power.

Lecture 8

If you can’t see the lecture 8 slides click here.

Lessons Learned

  • Cyber Command’s role is to:
    • defend the DoD information systems
    • support joint force commanders with cyberspace operations, and
    • defend the nation from significant cyberattacks
  • Cyber Command has evolved from a reactive, defensive posture to a proactive posture called “persistent engagement”


Technology, Innovation, and Great Power Competition – Class 7 – Space

This article first appeared in West Point’s Modern War Institute.


We just completed the seventh week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape the character and employment of all instruments of national power.

In class 1, we learned that national power is the sum of all the resources available to a state to pursue its national objectives and interests. This power is wielded through a combination of a country’s diplomacy, information, its military capabilities, economic strength, finance, intelligence, and law enforcement. These instruments of national power employed in a “whole of government approach” to advance a state’s interests are known by the acronym DIME-FIL.

Class 2 focused on China, the U.S.’s primary great power competitor. China is using all elements of its national power, e.g. information/ intelligence, its military might and economic strength as well as exploiting Western finance and technology. China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with its own neo-totalitarian model where China emerges as the dominant regional and global power.

The third class focused on Russia, which since 2014 has asserted itself as a competing great power. We learned how Russia pursues security and economic interests in parallel with its ideological aims.

The fourth class shifted our focus to the impact commercial technologies have on the instruments of national power (DIME-FIL). The first technology we examined was semiconductors, and the U.S. dependence on TSMC in Taiwan, for its most advanced logic chips.

In the fifth class we examined the impact that AI and Machine Learning will continue to have on the capabilities and employment of DIME-FIL.

In class six we discussed unmanned systems and autonomy and how the advent of these weapons will change operational concepts and the face of war.

Today’s class: The Second Space Age: Great Power Competition in Space.

Catch up with the class by reading our intro to the class, and summaries of Classes 123, 4, 5 and 6 


Required readings

The Cold War: Space Race 1.0

Space as a Domain

Age of Great Power Competition: Space Race 2.0

America’s Space Forces

Space Threats & Non-State Actors

Reading Assignment Questions

Pick one of the below questions and answer in approximately 100 words, based on the required readings. 

  1. Describe America’s space assets and the role of the U.S. Space Force in protecting and employing those assets. As the U.S. Space Force continues to develop, what changes in strategy and/or addition to its portfolio of responsibilities would you recommend?
  2. What is the greatest current threat to U.S. interests in space? What recommendations would you have for the U.S. and its partners to mitigate that threat?

Class 7 – Guest Speaker

Our guest speaker was General John Raymond, Chief of Space Operations. He is the first Chief of Space Operations, U.S. Space Force. Space Force has three major commands — Space Operations CommandSpace Systems Command, and Space Training and Readiness Command.

The Space Force was born as a separate service in December 2019. Previously General Raymond led re-establishment of U.S. Space Command as 11th U.S. combatant command, and was for a year the head of both a service (Space Force) and a combatant command (Space Command).

Raymond said a focus for the Space Force is being lean and fast, innovative and unified.

Space was once considered “benign,” largely uninhabited except by the United States and Russia and the Soviet Union. Today it is far more crowded and dangerous. Raymond pointed out that the ability to operate in space is critical not only to protect U.S. security, but also to power the U.S. and global economy, communications, transportation and other essential functions of everyday life.

“Space is clearly a warfighting domain and we’re convinced that if deterrence were to fail, we’re going to have to fight and win the battle for space superiority,” he said.

Lecture 7

If you can’t see the lecture 7 slides click here.

Next Week: Cyber

Lessons Learned

  • Our military depends on our assets in space (satellites) for communication, navigation, situational awareness (via photo, radar and electronic intelligence satellites) warning and targeting
  • Our civilian economy also depends on space assets for GPS and communication
  • Space is now a contested environment with China and Russia capable of disabling/destroying our satellites
    • Using directed energy (lasers), cyber, electronic warfare, ground or space-based kinetic weapons


Technology, Innovation, and Great Power Competition – Class 6 – Unmanned Systems and Autonomy

This article first appeared in West Point’s Modern War Institute.


We just completed the sixth week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape the character and employment of all instruments of national power.

In class 1, we learned that national power is the sum of all the resources available to a state to pursue its national objectives and interests. This power is wielded through a combination of a country’s diplomacy, information, its military capabilities, economic strength, finance, intelligence, and law enforcement. These instruments of national power employed in a “whole of government approach” to advance a state’s interests are known by the acronym DIME-FIL.

Class 2 focused on China, the U.S.’s primary great power competitor. China is using all elements of its national power, e.g. information/ intelligence, its military might and economic strength as well as exploiting Western finance and technology. China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with its own neo-totalitarian model where China emerges as the dominant regional and global power.

The third class focused on Russia, which since 2014 has asserted itself as a competing great power. We learned how Russia pursues security and economic interests in parallel with its ideological aims.

The fourth class shifted our focus to the impact commercial technologies have on the instruments of national power (DIME-FIL). The first technology we examined were semiconductors, and the U.S. dependence on TSMC in Taiwan, for its most advanced logic chips. This is problematic as China claims Taiwan is a province of China.

In the fifth class we examined the impact that AI and Machine Learning will continue to have on the capabilities and employment of DIME-FIL. We heard from the Joint Artificial Intelligence Center (JAIC), the focal point of the DOD AI strategy; and from the Defense Innovation Unit (DIU) – a DoD organization that contracts with commercial companies to solve national security problems.

Today’s class: Unmanned Platforms and Autonomy

Catch up with the class by reading our intro to the class, and summaries of Classes 123, 4 and 5


Required Readings

Unmanned Aerial Vehicles (UAV) & Unmanned Aerial Systems (UAS)

Unmanned Surface Vessel (USV) / Unmanned Undersea Vessel (UUV)

U.S. Unmanned Warfare Concepts

China Unmanned Warfare Concepts

Use of Drones in Nagorno-Karabakh

Reading Assignment Questions

Pick one of the below questions and answer in approximately 100 words, based on the required readings.

  1. Describe how the advent of autonomous weapon systems (i.e. drones) has changed the American way of war to date. What changes would you recommend America adopt as autonomous systems continue to develop?
  2. Pick one domain of war (e.g. air, land, sea, subsea, space, etc.). How does the proliferation of autonomous weapon systems to great powers, lesser powers, or non-state actors (pick one of the three) threaten America’s traditional military advantages in that domain?

Class 6 – Guest Speakers and Autonomy Panel

This class had seven guest speakers on unmanned systems and autonomy.

Our first guest speaker was Rear Admiral Lorin Selby, Chief of Naval Research, United States Navy. Admiral Selby is responsible for the Naval Research Enterprise. It is the “venture capital” of the Navy and Marine Corps. It’s made up of ONR – the Office of Naval ResearchONR Global, the Naval Research Laboratory, and Special Projects (PMR 51.)

(Founded in August 1946, ONR provided support of research at universities when WWII government funding to universities had dried up. Fred Terman, Stanford’s dean of engineering, received ONR’s first research grants for electronics and microwaves. These grants funded the Stanford Electronics Research Laboratory and kick-started innovation in what would become Silicon Valley.) Fast forward to this decade and ONR funded our first Stanford Hacking for Defense classes and is the first funder of the Stanford Gordian Knot Center for National Security Innovation.

RADM Selby described the role of the  Chief of Naval Research, the types of innovation, the role of ONR in capturing new/relevant ideas and pulling them in fast enough to compete with adversaries, but not disrupt the functionality of the Navy.

Our next guest was Maynard Holliday the DoD Director of Defense Research and Engineering for Modernization (5G; Artificial Intelligence and Machine Learning; Autonomy; Biotechnology; Cyber; Directed Energy; Fully Networked Command, Control, and Communications; Hypersonics; Microelectronics; Quantum Science; and Space). He described the role of his office as similar to DARPA. His 11 principal directors lay out the technical roadmaps for the DoD and help transition the technologies into operational use.

The principal DoD Modernization director for autonomy, Dr. Jaret C. Riddick, then joined us. He helped the class understand the DoD definition of Autonomy, the Lines of Effort the DoD is actively pursuing, and why it was important.

Lecture 6

If you can’t see the lecture 6 slides click here.

In the Department of Defense unmanned systems and autonomy are moving ahead rapidly. We gave the students a feel for the scope of the activities in two panel sessions.

Panel 1 – Autonomy/Unmanned Systems Research and Engineering

RADM Selby, Mr. Holliday, and Mr. Riddick joined a panel discussion on how their organizations set their research priorities and investment strategies. They discussed:

  1. What time horizon their organizations consider when determining which technologies to invest in
  2. How these investment strategies and time horizons compare and contrast with the same considerations made by China and Russia
  3. What the future of autonomous systems looks like. What the largest gains their organizations hope to make with investments in autonomy
  4. What ethical considerations they take into account when making technology investments Whether China and/or Russia have similar or different ethical considerations. How these ethical frameworks affect America’s ability to compete

Panel 2 – An Application of Autonomy – the Navy Unmanned Task Force

Four other experts on Autonomy in defense joined us for a discussion of the Vice Chief of Naval Operations Unmanned Task Force: Michael Stewart, Director of the US Navy Unmanned Task Force and Deputy Director Integrated Warfare; Bradley Garber, Deputy Director/Principal Civilian Advisor to the Vice Chief of Naval Operations; Dr. Jason Stack,  the Office of Naval Research Portfolio Manager for Autonomy; and Dr. Shane Arnott, Chief Engineer, Anduril Industries. They discussed:

  1. The impetus for the creation of their task forces
  2. The biggest challenges and opportunities for integrating autonomy from the private sector to support the DoD
  3. What the future of autonomous systems looks like. The largest gains that their organizations hope to make with investments in autonomy
  4. Where China and/or Russia are making the largest gains with autonomous systems. What threat this presents to U.S. interests

Next Week: The Second Space Age: Great Power Competition in Space

Lessons Learned

  • Autonomy and Unmanned Systems are critical technologies that will impact all aspects of the instruments of DIME-FIL national power
    • While advanced work in autonomy is happening in the DoD ecosystem, commercial companies and universities still lead
    • China and Russia have made autonomy and unmanned systems national priorities
    • Other countries, e.g. Turkey and Israel, have proliferated systems that have been used to win a war
  • The Navy is actively looking to build and integrate unmanned/autonomous systems as part of the fleet


Technology, Innovation, and Great Power Competition – Class 5 – AI and Machine Learning

This article first appeared in West Point’s Modern War Institute.


We just completed the fifth week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape all the elements of national power (America’s influence and footprint on the world stage).

In class 1, we learned that national power is the combination of a country’s diplomacy, information/intelligence, its military capabilities, economic strength, finance, intelligence, and law enforcement. This “whole of government approach” is known by the acronym DIME-FIL.

Class 2 focused on China, the U.S.’s primary  great power competitor. China is using all elements of national power: diplomacy (soft power, alliances, coercion), information/ intelligence, its military might and economic strength (Belt and Road Initiative) as well as exploiting Western finance and technology. China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with a neo-totalitarian model.

The third class focused on Russia, which since 2014 has asserted itself as a competing great power. We learned how Russia pursues security and economic interests in parallel with its ideological aims. At times, these objectives complement each other. At other times they clash, as Russian policy is run by Vladimir Putin and his political institutions.

The fourth class shifted our focus to the impact commercial technologies have on DIME-FIL. The first technology we examined were semiconductors, the oil of the 21st century. The U.S. is dependent on TSMC, located in Taiwan, for its most advanced logic chips. This is problematic as China claims Taiwan is a province of China.

Today’s class: Artificial Intelligence / Machine Learning

Catch up with the class by reading our intro to the class, and summaries of Classes 1, 2, 3 and 4


 

Required Readings

Introduction to AI

The AI Arms Race: Fact or Fiction?

China’s AI Strategy

Russian AI Strategy

US AI Strategy

Obama Administration

Trump Administration

Biden Administration

Other AI and National Security Resources

Reading Assignment Questions:

Pick one of the below questions and answer in approximately 100 words, based on the required readings. Please note that this assignment will be graded and count towards course participation.

  1. How would you characterize the geopolitical AI Arms Race? Is an “arms race” the right lens through which to understand this phenomenon, or is there another way to better understand great power competition in the AI domain?
  2. Can the U.S. learn any lessons from China’s AI strategy?

Class 5 – Guest Speakers

Our speakers for our fifth class were Mike Brown, Nand Mulchandani and Jacqueline Tame.

Mike Brown is the director of the Defense Innovation Unit (DIU) – a Department of Defense organization that contracts with commercial companies to solve national security problems. Previously Mike was the CEO of Symantec and Quantum.

Nand Mulchandani is the Chief Technology Officer of the Joint Artificial Intelligence Center (JAIC). The JAIC is the focal point of the Department of Defense AI strategy.

Jacqueline Tame was the former Acting Deputy Director of the JAIC and the architect of the JAIC “Gamechanger,” an AI-driven Policy Analysis Tool.

Mike Brown led off the session with an overview of the Defense Innovation Unit (DIU).

If you can’t see Mike Brown’s Defense Innovation Unit presentation click here.

Key takeaways from Mike’s talk were that 1) 50 years ago defense-related R&D made up 36% of global R&D. Today, defense-related R&D is 4%. Key technologies needed by defense today are made by commercial companies (5G, AI, biotech, quantum, access to space, batteries, etc.) 2) The top tech companies (Facebook, Alphabet, Microsoft, Amazon, and Apple) outspend U.S. prime contractors 11 to 1 in R&D ($70.5B versus $6.2B.)

DIU’s role is to find and then funnel commercial technology into the DoD by prototyping, transitioning, and scaling solutions. They have (by DoD standards) an extremely fast pipeline from problem curation, to evaluating and selecting companies, then prototyping projects and inserting them into DoD programs. AI/MLis one of the six core areas DIU focuses on (along with space, autonomy, advanced energy and materials, cyber and human systems.) DIU AI/ML has three lines of effort: machine Learning predictions, big data analysis, enhanced decision making.

Nand Mulchandani described the role and the initiatives of the JAIC. One in particular, Gamechanger, was conceived and run by Jacqueline Tame.

Gamechanger uses AI to tackle a problem only a government could create. The DoD and federal regulations have 10’s of thousands of policies, laws, regulations that tell decision-makers what they can or cannot do. These exist in different places on different networks and change almost daily. Now you could simply type a natural language query that asks, “Do I have the authority do x?” Or, “How can purchase this item quickly?” etc.

Lecture 5

If you can’t see the slides, click here

Our first discussion in class (Slide 7) was whether Nicholas Chaillan’s (the first Air Force Chief Software Officer) claim that we have already lost the AI battle to China was correct.

Slides 9-14 kicked off the discussion of the geopolitical implications of AI. Given both China and Russia have made a AI a national effort, how will AI impact all aspects of DIME (Diplomatic, Intelligence, Military, and Economic) and national power? What are the impacts of AI created deep fakes? AI automating image recognition of satellite data? AI creating optimal concepts of operations? AI-tuned cyber-attacks? AI cyber security? AI smart/predicative maintenance? etc.  Where will we first see its impacts? What will our response be?

Class Discussion Questions: (Slide 15)

  • How would you characterize the strengths and weaknesses of the U.S.’s AI Strategy?
  • How would you advise the Biden Administration to pursue an AI Strategy?

Next week: Autonomy and Unmanned Systems

Lessons Learned

  • AI and machine learning is a critical technology that will impact all aspects of DIME (Diplomatic, Intelligence, Military, and Economic) and national power
  • Most of the advanced work in AI/ML is happening in commercial companies and universities not the DoD
    • China and Russia have made AI and machine learning national priorities
  • The Defense Innovation Unit (DIU) exists to find and then funnel commercial technology like AI/ML into the DoD
  • The Joint Artificial Intelligence Center (JAIC) is the focal point of the Department of Defense AI strategy


Technology, Innovation, and Great Power Competition – Class 4- Semiconductors

This article first appeared in West Point’s Modern War Institute.  


We just completed the fourth week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape all the elements of national power (America’s influence and footprint on the world stage).

In class 1, we learned that national power is the combination of a country’s diplomacy (soft power and alliances), information/intelligence, military power, economic strength, finance, intelligence, and law enforcement. This “whole of government approach” is known by the acronym DIME-FIL.  And after two decades focused on counter terrorism, the U.S. is now engaged in great power competition with both China and Russia.

In class 2 the class focused on China, the U.S.’s primary great power competitor. China is using all elements of national power: diplomacy (soft power, alliances, coercion), information/ intelligence (using its economic leverage over Hollywood, controlling the Covid narrative), its military might and economic strength (Belt and Road Initiative) as well as exploiting Western finance and technology. China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with a neo-totalitarian model.

The third class focused on Russia, which is asserting itself as a great power challenger. We learned how Russia pursues security and economic interests in parallel with its ideological aims. At times, these objectives complement each other. At other times they clash, Putin’s desire to restore Russia into a great power once again leads to a foreign policy that is opposite the interests of the Russia people. As Putin himself has said, “The collapse of the Soviet Union was a major geopolitical disaster of the century,” and that quote offers a window to his worldview as he tries to remake Russia into a great power once again.”

Having covered the elements of national power (DIME-FIL) and China and Russia, the class now shifts to the impact commercial technologies have on DIME-FIL. Today’s topic – Semiconductors.

Catch up with the class by reading our intro to the class, and summaries of Classes 1, 2 and 3.


Class 4 Required Readings:

Silicon Valley, the Military, and the Journey to the Fourth Industrial Revolution

Moore’s Law & the Global Semiconductor Industry

Semiconductor Case Study

Reading Assignment Questions:

Pick one of the below questions and answer in approximately 100 words, based on the required readings. Please note that this assignment will be graded and count towards course participation.

  1. Describe the roles of Fred Terman, William Shockley, and Fairchild Semiconductor in the genesis of Silicon Valley. Who had a greater role in creating Silicon Valley, Fred Terman or the Traitorous Eight?
  2. How would you characterize China’s attempt to catch-up in the semiconductor industry? Do you think China can credibly catch TSMC (without an invasion of Taiwan)? Why or why not?

Discussion Questions

  1. Put yourself in the shoes of Mark Liu, chairman of TSMC: Do you view China as more of a competitor or customer – and why?
  2. Now imagine you are the NSC Senior Director with responsibility for technology strategy. What’s the first thing the U.S. Gov’t should do regarding semiconductors?

Class 4: Guest Speaker
Our guest speaker for our fourth class was John Hurley, former Member of the President’s Intelligence Advisory Board, an expert on semiconductors and supply chains, and former Captain, U.S. Army.

Lecture 4

If you can’t see the slides, click here

Slide 4. The critical role of semiconductors in great power competition. Both our commercial and military systems are dependent on semiconductors. China spends more on semiconductor imports than it does on oil. We framed the advances in technology as part of the 4th industrial revolution. Slides 5-7. We reminded the students of the role the DoD and IC played at Stanford turning it into an outward-facing university, which kick-started technology entrepreneurship here in Silicon Valley.

Slides 9-11 Dual-use technology. For the first time in 75 years, federal labs and our prime contractors are no longer leading innovation in many critical technologies including AI, machine learning, autonomy, biotech, commercial access to space, etc. Rapid advances in these areas are now happening via commercial firms – many in China. This is a radical change in where advanced technology comes from. In the U.S., the government is painfully learning how to reorient its requirements and acquisition process to buy these commercial, off-the-shelf technologies. (Products that are sold commercially and to the DoD are called “dual-use.”)

Slide 15. Semiconductor industry. We began a deep dive into semiconductors by drawing the map of the semiconductor industry (Slides 3-15 from this required reading.) Five companies provide the majority of the wafer fab equipment needed to make chips. TSMC is the leading fab for manufacturing logic chips. (Slides 32-33 from this required reading.) Of the 29 new fabs starting construction in 2021-22, over half are in China and Taiwan.

Slide 16. TSMC Case. We took the class through the TSMC case study and mapped out the roles and interests of TSMC, China, Intel, and the U.S. Slides 17-18. We discussed China’s drive for semiconductor independence, U.S. export controls on Huawei (why and its consequences,) the various constituencies of a U.S. semiconductor policy (Commerce Department, DoD, U.S. chip makers, U.S. semi equipment suppliers, etc.), whether TSMC’s success makes Taiwan more or less secure, given China’s goals of reunification with Taiwan.

Slide 19-20. Policy.  How do decision makers formulate policy? Does it start by asking “What problem do we want to solve?” Using semiconductors as an example, is it China’s access to U.S. technology?  Or is it China embedding this advanced U.S.-designed technology into their military systems? Or what happens to TSMC and Western access to advanced technology if China quarantines or invades Taiwan?

How do policy makers select and narrow a problem? Is it based on the value the policy adds for identified stakeholders? Is it a personal passion/interest? Specifically for China and semiconductors, what are potential solution ideas? Export controls? Stronger CFIUS regulations? How do you take into account stakeholder feedback (DoD, Commerce Department, commercial firms)? And once you create a policy, how do you effectively implement it?

Slide 21 -23. Class midterm assignment: Assume you’re a policy maker. Write a 2,000-word policy memo that describes how a U.S. competitor is using a specific technology  (semiconductors, AI, autonomy, cyber, etc.) to counter U.S. interests. Propose how the U.S. should respond.

Slides 25- 32 Group Projects. We had several teams talk about their learnings from their out-of-the building interviews. Team ShortCircuit (Slide 29) is working on how the U.S. should improve its ability to design and produce semiconductors, and develop and retain relevant talent. They heard from a professor that the ratio of Stanford students taking software versus hardware courses was 10-to-1 software, a complete reversal from decades ago. We discussed whether  1) that was true or just anecdotal 2) if true, was it the same in other research universities, 3) why it happened (software startups are getting funded at obscene valuations)? 4) and what kind of incentives and policies would be needed to change that, and 5) where in the value chain those might be most effective (students, venture capitalists, government, etc.)

Next week: Artificial Intelligence / Machine Learning

Lessons Learned

  • Semiconductors are the oil of the 21st All economies run on them.
  • Semiconductors are China’s biggest imports
  • China’s roadmap for building an indigenous semiconductor industry and accelerating chip manufacturing is the National Integrated Circuit Plan
    • The goal is to meet its local chip demand by 2030
  • The U.S. is dependent on TSMC, located in Taiwan, for its most advanced logic chips
    • China claims Taiwan is a province of China
    • TSMC will build a fab in Arizona, but it will represent only 2% of its capacity
  • What are U.S. policy makers’ options?


11/02/2021 Technology, Innovation, and Great Power Competition – Class 4 – Semiconductors

Technology, Innovation, and Great Power Competition – Class 3 – Russia

This article first appeared in West Point’s Modern War Institute. 


We just had our third week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape all the elements of national power (our influence and footprint on the world stage).

In class 1, we learned that national power is the combination of a country’s diplomacy (soft power and alliances), information/intelligence, its military, economic strength, finance, intelligence, and law enforcement. This “whole of government approach” is known by the acronym DIME-FIL. And after two decades focused on counter terrorism the U.S. is engaged in great power competition with both China and Russia.

In class 2, we learned how China is using all elements of national power: diplomacy (soft power, alliances, coercion), information/intelligence (using its economic leverage over Hollywood, controlling the Covid narrative), its military might and economic strength (Belt and Road Initiative,) to exploit Western finance and technology.  This has resulted in Western democracies prioritizing economic cooperation and trade with China above all else.  China’s goal is to challenge and overturn the U.S.-led liberal international order and replace it with a neo-totalitarian model.

Going forward, coexistence with China will involve competition but also cooperation. But it’s going to take the demonstrated resolve of the U.S. and its allies to continue to uphold a rules-based order where nations share a vision of a free and open Indo-Pacific where the sovereignty of all countries are respected.

Catch up with the class by reading our intro to the class, and summaries of Class 1 and Class 2.

All which leads to today’s topic, the other great power – Russia.


 

Class 3 Required Readings

Fall of the USSR

Russian Geopolitics & Foreign Policy

Putin & Putinism

Russia’s Pivot to Asia & the Chinese-Russian Relationship

Russian Technology Strategy

Reading Assignment Questions:

Pick one of the below questions and answer in approximately 100 words, based on the required readings. Please note that this assignment will be graded and count towards course participation.

  1. Compare and contrast the viewpoints of John Mearsheimer and Michael McFaul on drivers of Russian foreign policy. Where do they agree? Disagree? Which perspective do you agree with more and why?
  2. Evaluate the perspectives of Artyom Lukin and Chris Miller on Russia’s so-called pivot to Asia. Do you agree with one more than the other? Do you believe that the pivot is more a rhetorical or substantive strategic move on the part of Moscow?

Class Discussion Questions:

  1. What are Russia’s geopolitical interests, goals, and/or objectives? From Moscow’s perspective, what are the main obstacles standing in the way of achieving its national goals?
  2. To what degree is Vladimir Putin a unitary actor? How much is he the system of government versus the product of a system?
  3. How does Moscow view the existing, American-led rules-based international order?
  4. What role, if any, does ideology play in Moscow’s strategy?
  5. In what ways are Moscow’s goals compatible and/or incompatible with U.S. national interests?
  6. In what domains does the competition between the United States and the Russian Federation play out? How do these domains interact with one another? Is cooperation between the two possible and beneficial?
  7. How would you characterize the Sino-Russian relationship? In what dimensions is the relationship the strongest? Where are its fault lines? Is the relationship enduring or transient?

Class 3: Guest Speaker

Our guest speaker for our third class was Mike McFaul, the former U.S. Ambassador to the Russian Federation and former National Security Council Senior Director for Russian and Eurasian Affairs. Mike wrote about his experience as ambassador in From Cold War to Hot Peace: An American Ambassador in Putin’s Russia. At Stanford, Mike is the Director of the Freeman Spogli Institute for International Studies,Stanford’s research institute for international affairs, and the home for this class and the Gordian Knot Center for National Security Innovation.

Lecture 3

If you can’t see the slides, click here

Ambassador McFaul pointed out that at times Russia pursues security and economic interests in parallel to ideological aims. At times, these objectives complement each other. At other times, they clash. He posited it’s because Russian policy is run by Putin and his political institutions. Slide 7

We then reviewed highlights from the assigned readings. John Mearsheimer’s article took the contrarian position that the United States and its European allies share most of the responsibility for the crisis in Crimea. Slide 8.

Slides 10-12 led the conversation about the end of the Cold War & Collapse of the USSR. George Kennan was the author of the 1946 Long Telegram which set in motion the policy of “containment” of the Soviet Union. He lived to see its collapse a half-century later, and wrote, “I find it hard to think of any event more strange and startling, and at first glance more inexplicable, than the sudden and total disintegration and disappearance…of the great power known successively as the Russian Empire and then the Soviet Union.”  Stephen Kotkin maintains that if the Soviet elite had so chosen, they could have sustained the Soviet Union decades longer. Perhaps the most enduring quote is from Vladimir Putin himself, “the collapse of the Soviet Union was a major geopolitical disaster of the century,” as he tries to remake Russia into a great power once again.

Slide 13, Dmitri Trenin from the Carnegie Center points out that the 2014 Ukrainian crisis was the Rubicon. Russia broke a quarter century of cooperative relations among great powers pivoting away from the west, starting a new era of intense competition. Slide 14, Mike McFaul has a more nuanced view. “For a complete understanding of Russian foreign policy.., individuals, ideas, and institutions—President Vladimir Putin, Putinism, and autocracy—must be added to the analysis. (The).. three cases of recent Russian intervention (in Ukraine in 2014, Syria in 2015, and the United States election in 2016) illuminate the causal influence of these domestic determinants in the making of Russian foreign policy.

Slide 15, Russia’s pivot to China.

China-Russian relations are now at their highest point since the mid-1950s, being drawn to each other by the most elementary law of international politics: that of the balance of power. Slide 16 Russia has long struggled to overcome the constraints imposed by the country’s chronic inability to retain talent in support of homegrown innovation and R&D.

North Korea/Iran/Non-Nation States
We also covered the two regional threats to international security – North Korea and Iran – as well as the continued threats of terrorism from non-nation states (Al-Qaeda’s, ISIS).

Slides 20-22. North Korea has robust and expanding nuclear weapons program with 10-40 nuclear weapons. Their ballistic missile program not only threatens their neighbors, but their development of long-range ICBMs puts the entire continental United States in range of their nuclear weapons.

Slides 23-25 the Islamic Republic of Iran (IRI) has actively pursued nuclear weapons and long range ballistic missiles. Under the Iran Nuclear Deal (JCOPA) they had agreed to limit their uranium to 3.67% enrichment. They broke out of the deal in 2019. Today, their uranium enrichment has reached 60% enrichment (90% is weapons grade). Iran has been a major source of regional destabilization, hostage-taking, and sponsorship of terrorism: Ansar Allah (Houthis) in Yemen, Hezbollah in Lebanon, Hamas/PIJ in Palestine, numerous Shia militias in Iraq (Kataib Hezbollah, Asaib Ahl al Haq, Badr Organization). Iran’s long-running conflict with Israel is a perennial potential flashpoint for a broader conflict in the region. Iran has been actively using cyber attacks and has attacked and harassed commercial shipping and Freedom of Navigation Operations in the Persian Gulf and the Strait of Hormuz.

Slides 26-27 Non-nation states haven’t gone away. They are a persistent, survivable threat unconstrained by traditional geopolitical checks (irrational actor). They are capable of regional and international terror attacks. Some are actively pursuing acquisition of weapons of mass destruction (nuclear, chemical, biological). Addressing the problem through counterinsurgency/ counter terrorism operations, runs the risk of long-term engagements that damage other national objectives and, sometimes, the national interest. Yet, if left unaddressed, these insurgencies can spread globally and create second- and third-order challenges (al-Shabab, Boko Haram, Abu Sayyaf).

Slides 28-31 covered the Group Project. The class has formed into 7 teams – slides 32-38. We suggested they get out of the building to first deeply understand the problem they’ve selected.

We offered a series of questions they may want to ask:

Slide 33. Who has this problem? Why does the problem exist? Consequence of the problem? When do they need a solution? How does this get deployed/delivered? How are they solving it today? How do you know you solved the problem?

Slide 34. Next, after they validate the problem: What would a minimum viable product look like? Who would build and deliver the final product/service? How to you create an “Innovation Insurgency” around the idea? Who would have to get excited about the MVP to fund it? Who are the saboteurs?

Next week we start talking about the impact of commercial technology on Great Power Competition. First up – semiconductors.

Lessons Learned

  • After the collapse of the Soviet Union, the U.S. and the Russia Federation had a two-decade long cooperative relationship
  • In 2014 with the Russian-Ukrainian war and Russia’s annexation of Crimea, and in 2015 with Russian intervention in the Syrian civil war, Russia’s interests and the West’s have radically diverged
    • Mike McFaul makes the case that Putin, Putinism, and the Russian autocracy are key determinants of their foreign policy
  • This week, student teams will start getting out of the building to build reflexes and skills to deeply understand a problem
    • By gathering first-hand information to validate that the problem they are solving is the real problem, not a symptom of something else
    • Then, students will begin rapidly building minimal viable solutions as a way to test and validate their understanding of both the problem and what it would take to solve it


Technology, Innovation, and Great Power Competition – Class 2 – China

This article first appeared in West Point’s Modern War Institute.


We just had our second week of our new national security class at Stanford – Technology, Innovation and Great Power CompetitionJoe FelterRaj Shah and I designed the class to cover how technology will shape all the elements of national power (our influence and footprint on the world stage).

Catch up with the class by reading our intro to the class and summaries of Classes 134, 5 6, 7 and 8.)

A key focus of the class is the return of Great Power competition. This isn’t an issue of which nation comes in first, it’s about what the world-order will look like for the rest of the century and beyond. Will it be a rules-based order where states cooperate to pursue a shared vision for a free and open region and where the sovereignty of all countries large and small is protected under international law? Or will an alternative vision for an autocratic and dystopian future be coerced and imposed by revisionist powers set on disrupting the U.S. led international order- an order that has brought the world unprecedented peace and prosperity since the end of the Second World War?

All of which leads to today’s topic – China.


Class 2 Required Readings

Class 2- Reading Assignment Questions

Pick one of the below questions and answer in approximately 100 words, based on the required readings.

  • To what degree does the People’s Republic of China have an overarching grand strategy, according to the readings? Do you agree or disagree with the arguments of the readings and why? Even if China does have a grand strategy, is it possible for China to maintain coherent, consistent execution of its strategy? Why or why not?
  • What are the CCP’s objectives regarding the international system? What instruments of national power does the CCP employ to achieve which specific impacts in order to achieve its objectives?

Class 2-  Discussion Questions

  • What is the Chinese Communist Party (CCP) trying to achieve? What are its goals and objectives? What is Xi Jinping trying to achieve? To what extent are Xi’s goals congruent with the broader CCP’s goals?
  • How does the CCP and/or Xi view the existing international system?
  • From the CCP’s perspective, what are the main obstacles standing in the way of achieving the goal of “National Rejuvenation”?
  • What role does ideology play in the CCP’s strategy?
  • In what ways are the CCP’s goals compatible and/or incompatible with U.S. national interests?
  • In what domains does the competition between the United States and the People’s Republic of China play out? How do these domains interact with one another?

Class 2- Guest Speakers

Our speakers for our second class were Matt Pottinger and Matt Turpin.

Matt Pottinger, was a former Deputy National Security Advisor and former National Security Council Senior Director for Asia. As a former Marine, Matt had 3 combat deployments in Iraq and Afghanistan. Prior to joining the Marine Corps, Matt was a reporter in China, first at Reuters, then at the Wall Street Journal.

Matt Turpin, was a former National Security Council Director for China and the Senior Advisor on China to U.S. Secretary of Commerce. Before entering the White House, Turpin served over 22 years in the U.S. Army. Among other Indo-Pacific focused roles, he served as a China advisor to the Chairman of the Joint Chiefs of Staff at the Pentagon and assisted the Deputy Secretary of Defense with the Defense Innovation Initiative, examining the role of innovation in U.S. defense policy.

Lecture 2

If you can’t see the slides click here.

Slides 7-10 are selected quotes from our assigned reading. Our lecture and discussion (slides 11-16) took us through the evolution of the hopes the U.S. had for its four-decade-long strategy of diplomatic and economic engagement with China. The hope was that helping China grow its economy would lead to liberalization of its government and greater freedoms for its people. Deng Xiaoping said China needed to “hide our capabilities, bide our time.” Over time, Xi has moved China to a more overt and aggressive phase, no longer hiding its intention to challenge the West. As we discovered, China’s agenda always had been radically different than ours. The growing realization over the last five years is that our hopes for China to democratize as it developed economically were terribly naïve. What we’ve come to realize is that China has been playing a decades-long game to challenge and overturn the U.S.-led liberal international order and replace it with a neo-totalitarian model.

Realizing this, four years ago the U.S. reoriented from a focus on counter terrorism to a new emphasis on great power competition with Russia and China. This new effort can be seen in the Interim U.S. National Security Strategy (which outlines the major U.S. national security concerns and how we plan to deal with them) and 2018 National Defense Strategy  (which identifies the priorities and capabilities required by the warfighters to implement the National Security Strategy).

Relevant to this course, China is using all elements of national power: diplomacy (soft power, alliances, coercion), information/intelligence (using its economic leverage over Hollywood, controlling the Covid narrative), its military might and economic strength (Belt and Road Initiative.) China has exploited western finance and technology, and has successfully convinced Western democracies to prioritize economic cooperation and trade with China above all else.

At home, China’s use of digital authoritarianism (facial recognition, biometrics, and social credit) has turned its own country into a surveillance dystopia to ensure that there are no internal challenges to the supremacy of the Chinese Communist Party (CCP). The CCP’s oppression of the Uyghurs – a Muslim minority in the western province of Xinjiang – is considered a genocide by many as well as a harbinger of what a Chinese world order will look like.

Going forward, coexistence with China will involve competition but also cooperation. But it’s going to take the demonstrated resolve of the U.S. and its allies to continue to uphold a rules-based order where nations share a vision of a free and open Indo-Pacific where the sovereignty of all countries are respected.

Slides 18-20 dug a bit deeper about why and how of the group project. Students formed teams to work on one of the Great Power Competition issues at the intersection of commercial technologies (AI, machine learning, autonomy, biotech, cyber, commercial access to space, et al.) and DIME-FIL (Diplomatic, Information, Military and Economic, Finance, Intelligence and Law Enforcement.)

Given who our students are, we assume they can all go online and to the library and write a great research paper. As we pointed out to them, while you can be the smartest person in the building, it’s unlikely that 1) that all the facts are in the building, 2) you’re smarter than the collective intelligence sitting outside the building.

Our teaching assistants (who previously took our Hacking for Defense class) shared with the students their own journey of what happens to early assumptions and how solutions evolve when you get out of the building.

If you can’t see the Project Agrippa slides click here.

We want our students to build the reflexes and skills to deeply understand a problem by gathering first-hand information and validate that the problem they are solving is the real problem, not a symptom of something else. Then, students will begin rapidly building minimal viable solutions (policy, software, hardware …) as a way to test and validate their understanding of both the problem and what it would take to solve it.

And they thought we were just going to have great lectures.

Next week – Russia

Lessons Learned

  • The U.S. hoped that helping China grow its economy would lead to liberalization of its government and greater freedoms for its people
    • We were terribly naïve
  • China has been playing a decades-long game to challenge and overturn the U.S.-led liberal order and replace it with a neo-totalitarian model
  • Students will collaborate on teams to first understand and then work to solve national security challenges at the intersection of DIME-FIL and dual-use technology


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