Introduction
This compelling interview features Eric Schmidt, former CEO of Google and Alphabet Chairman, sharing critical insights on the intensifying technological competition between the United States and China. Recorded at a tech conference, Schmidt discusses the multifaceted battleground spanning artificial intelligence, space technology, military innovation, and the future of warfare. His perspective as both a tech industry leader and unpaid government adviser provides a unique vantage point on America’s strategic position in this global competition.
Video: Eric Schnidt @ ALL-in Summit 2025
China’s Tech Strategy: Focus on Applied AI Over AGI
Schmidt reveals a surprising observation from his recent trip to China: while American companies pursue ambitious artificial general intelligence (AGI) projects, China has adopted a different approach due to hardware limitations from U.S. chip restrictions and limited access to deep capital markets. Chinese companies are focusing on applying AI to practical applications across consumer apps, robotics, and everyday technologies. The Chinese work ethic of “996” (9 AM to 9 PM, six days a week) demonstrates their commitment, despite this practice being technically illegal.
Schmidt observed Shanghai’s robotics companies attempting to replicate in robotics what they achieved with electric vehicles. Additionally, China is pursuing an open-source strategy with open weights and training data, positioning themselves to influence the global majority through a “belt and road initiative” for AI models. This contrasts sharply with America’s predominantly closed-weight approach, raising concerns about whose values will shape global AI development.
The Evolution of Modern Warfare: From Tanks to Drone Swarms
Schmidt’s work with Ukraine’s defense has given him firsthand insight into warfare’s transformation. He describes modern conflict as fundamentally different from traditional military doctrine, with drones rendering expensive fixed assets like tanks obsolete. A retail drone costing $5,000 can destroy a $30 million tank, completely upending traditional military economics.
The advancement of AI in warfare includes capabilities like lethal autonomous drones, unmanned armed robots, and AI-based targeting systems that can analyze massive amounts of imagery to identify changes and enable rapid defensive responses. Schmidt predicts warfare will evolve through several phases: first, drones replacing traditional artillery and rifles; second, drone-versus-drone combat requiring sophisticated detection and destruction capabilities; and ultimately, battles fought by AI-powered drone swarms using reinforcement learning for battle planning.
The most profound implication is that when both sides employ AI-driven reinforcement learning strategies, neither can predict the other’s battle plans, creating a powerful deterrent effect. However, Schmidt emphasizes that these drone battles would still result in complete infrastructure destruction on both sides, making them lose-lose scenarios that ideally prevent conflict altogether.
Space Competition and Innovation: Relativity Space
Schmidt recently took over Relativity Space, a SpaceX competitor, motivated by his passion for aviation and the challenging nature of rocket technology. He was surprised to learn that rocket technology remains more art than mature science, unlike jet engines. The physics of space travel remain stubbornly constrained: approximately 2% of rocket weight is payload, 18% is the rocket itself, and 80% is propellant—proportions that have barely improved in 60 years.
The company focuses on low Earth orbit satellite launches with a full order book, waiting only for successful rocket launches to execute. Schmidt’s investment reflects his belief in the importance of space infrastructure for both commercial and national security purposes.
The AGI Debate: Timeline and Implications
On artificial general intelligence, Schmidt presents a nuanced view distinct from the “San Francisco narrative” of imminent AGI. While acknowledging that agent-based systems and recursive self-improvement research continues, he doesn’t believe true AGI will arrive within three years, estimating instead six to seven years for domain-specific “savants” in programming, mathematics, physics, and chemistry.
True general intelligence requires the ability to set one’s own objective function—something current systems cannot do. The technical challenge involves “non-stationarity” of mathematical proofs, where objective functions constantly change as humans experience daily. The ultimate test would be whether AI could derive Einstein’s special and general relativity using only information available in 1902. Schmidt believes this will eventually be solved through analogy—the ability to transfer deep understanding from one domain to completely different domains.
For the near term, Schmidt envisions AI remaining “middle to middle” rather than “end to end” like humans, requiring human prompting, validation, and iterative refinement. This creates a synergistic relationship where AI assists with tasks while humans define objectives and provide context.
American Competitiveness and Values
Throughout the discussion, Schmidt emphasizes his desire for American success, motivated by gratitude for opportunities provided through the American dream. He contrasts American strengths—chaotic creativity, deep financial markets, strong universities, and entrepreneurial culture—with the structured discipline of Asian competitors. He advocates for celebrating and accelerating these advantages while acknowledging global demographic challenges, including declining birth rates across developed nations.
Schmidt expressed concern about work-from-home trends, particularly for young professionals who need in-person mentorship and collaborative learning. His experience at Sun Microsystems taught him invaluable lessons from observing senior colleagues debate in person—experiences difficult to replicate virtually.
Brief Conclusion
Eric Schmidt presents a comprehensive view of the multifaceted technological competition between the United States and China, spanning AI development, military innovation, and space exploration. His insights reveal that while China pursues practical AI applications and open-source dominance, America focuses on breakthrough AGI research and maintains technological leadership through innovation and deep capital markets. The transformation of warfare through AI and drones represents both opportunities for deterrence and risks of catastrophic infrastructure destruction. Schmidt’s message is clear: America must leverage its unique strengths—entrepreneurial culture, financial depth, and technological innovation—while maintaining work ethic and commitment to compete effectively in this consequential competition.
Key Takeaways
- China’s Practical AI Focus: Rather than pursuing AGI, China concentrates on applying AI to consumer applications, robotics, and practical technologies, potentially winning global market share through open-source models
- Warfare Transformation: Modern warfare is shifting from expensive fixed assets to cost-effective autonomous drones, fundamentally changing military economics and strategy
- AI-Driven Deterrence: Future conflicts may involve AI-controlled drone swarms using reinforcement learning, creating unpredictable battle plans that paradoxically increase deterrence
- AGI Timeline Uncertainty: True artificial general intelligence remains 6-7 years away at minimum, requiring breakthroughs in non-stationary problem solving and analogical reasoning
- American Competitive Advantages: The U.S. must leverage its strengths in deep capital markets, entrepreneurial culture, innovation, and university systems while maintaining work ethic and commitment
- Space Technology Maturity Gap: Rocket technology remains surprisingly immature compared to jet engines, presenting both challenges and opportunities for innovation
- Work Culture Matters: In-person collaboration and mentorship remain crucial for young professionals’ development, despite remote work trends
Related References
For deeper insights into these topics, consider exploring:
- Eric Schmidt’s work rewiring the US military through AI integration and his role on the Defense Innovation Board (Building the Perfect AI War-Fighting Machine)
- Analysis of the global AI arms race, data supremacy, and the role of autonomous systems in modern warfare (War, AI and the New Global Arms Race | Alexandr Wang)
- OpenAI’s developments in AGI research and GPT model evolution
- Ukraine’s innovative use of drones and AI in modern conflict
- China’s “996” work culture and its implications for technological competition
- The role of Starlink in enabling remote military operations
- Deep learning advances in reinforcement learning and planning algorithms
