According to the report, the Pentagon is expected to initiate cooperation in military R&D with several Silicon Valley startups as the US seeks efficient ways to keep on par with Chinese military innovations in small drones and other high-tech military equipment production.
Through the Cold War and continuing today, the US Military has been crucially dependent on consolidated and large arms makers, such as Lockheed Martin, Northrop Grumman, General Electric et cetera. On the contrary, China–traditionally perceived as having a more socialist-like state-affiliated economy–surpassed the US in private initiative support of its military.
“China is organized like Silicon Valley,” and the Pentagon is organized more like a Detroit automaker... That’s not a fair fight,” Steve Blank, co-founder of the Gordian Knot Center for National Security Innovation, commented on the situation as cited by the newspaper.
The expert added that some estimates of Chinese military investments in the private sector may reach $1 trillion.
Conversely, the US government has requested $115 million to establish the Office of Strategic Capital within the Pentagon, aimed at securing investment from venture capital firms into companies that produce critical military technology and products. This move is part of a broader strategy to draw innovation and ideas from smaller private startups.
This push for external investment comes as venture capitalists increasingly take interest in the military business, largely driven by Washington's focus on China and the success of companies like Elon Musk's SpaceX in securing Pentagon contracts. The Office of Strategic Capital is expected to play a pivotal role in attracting venture capital firms to invest in the military industry.
As stated in October's 2022 National Security Strategy (NSS) published under Biden's Administration China is seen as “America's most consequential geopolitical challenge”.