As China scrambles to catch up to Nvidia in the AI chip race, the United States must recognize the real reason it’s still ahead: not subsidies or sanctions, but a cultural embrace of failure as a stepping stone to innovation.
Nvidia just reached a market cap of about $5 trillion, cementing its role as the crown jewel of the AI revolution. Its GPUs power everything from ChatGPT-like models to autonomous vehicles and military applications. But behind Nvidia’s dominance is not just superior engineering; it’s a culture of risking-taking and learning from setbacks.
In contrast, China’s approach to innovation is often characterized as scaling existing technologies rather than fostering groundbreaking advancements. Despite massive government investments, China has not yet produced an AI chip that can rival Nvidia’s H100 or the newer B200. The gap is not due to a lack of talent or investment, but a deeply cultural aversion to failure.
In Chinese education, failure is frequently viewed as a source of shame, a concept known as “losing face” or mianzi. This cultural norm permeates classrooms, workplaces, and family life, discouraging the risk-taking necessary for true innovation.
Take Chinese schools, for example, Ms. Zhang, a high school teacher in Beijing, noted that there is a strong societal expectation that all students work diligently and perform well. Schools often rank students from 1 to 50. The top students sit in the front rows, while those deemed to be underperforming or unmotivated are relegated to the back. This seating arrangement publicly shames students, highlighting their perceived lack of work ethic and care. The embarrassment extends beyond the classroom, as students fear the consequences of their poor performance at home, where their failure could bring additional shame.
I also observed this firsthand during my time at Renmin University in Beijing. Students were often too intimidated to challenge their professors or question their statements. Even politely pointing out a mistake could result in public humiliation, as the student was seen as arrogant, disrespectful, and overstepping their role. In this system, professors are treated as near-infallible authorities, with their words regarded as unquestionable fact. This environment stifles critical thinking and discourages intellectual independence.
In the workplace, this aversion to failure can manifest in practices that discourage individual recognition. The joint venture between McDonnell Douglas and Shanghai’s Aircraft Manufacturing Company illustrated the challenges of applying Western management practices in China. McDonnell Douglas rewarded standout employees with bonuses and “Employee of the Month” recognition. That approach clashed with Chinese cultural norms, where it is expected that everyone of the same social rank or job title performs equally well. Awarding select individuals for their superior performance is seen as an implicit critique of the others, suggesting they have not performed up to standard. This approach reflects a cultural reluctance to recognize individual merit, which can hinder the growth of a culture of excellence and suppress innovation.
In contrast, the United States has fostered a culture that sees failure as a vital component of innovation. From “show-and-tell” in kindergarten to higher education, American schools encourage students to explore, question, and experiment. By the time they reach university or enter the workforce, they have internalized that mistakes and challenges to the status quo are not sources of shame but opportunities for learning and growth.
The United States has long embraced an interdisciplinary approach to education, encouraging the blending of seemingly unrelated ideas often leads to groundbreaking advances. This mindset produced innovations like the iPhone, where Steve Jobs combined a phone, a camera, and a computer into a single device. At the time, it was a bold and unconventional idea, but the willingness to take risks along with the cultural acceptance of failure made Apple’s breakthrough possible.
China has found success in sectors from solar panels to high-speed rail by refining what’s already out there. But true breakthrough innovations like CRISPR, the transistor, or Nvidia’s AI chips are born not from incremental steps but from a willingness to question authority, experiment, and most importantly, fail.
The United States’ real advantage in the AI chip race and across all high-tech fields lies not just in its resources, but in its culture of innovation. To stay ahead, the U.S. must continue to nurture an environment where failure is embraced rather than feared. By protecting this mindset, the United States can remain the global leader in the next breakthrough, just as it has for the past century. True innovation doesn’t come from obedience; it comes from the courage to fail.