While Trump fights over aluminum and steel, Silicon Valley braces for a real trade war

But some Silicon Valley executives fear that the protection of an old-school industry, one that accounts for just 2 percent of global trade, could be a prelude for a much broader clash with China over the theft of technologies that are driving the future of the global economy. Such a conflict would have a profound impact on how Silicon Valley does business with a critical, if elusive, trading partner.

The dispute is already underway. In August, the Trump administration initiated a sweeping investigation into Chinese trade practices, including whether Chinese firms are investing in U.S. companies to steal their technology and whether they are forcing joint ventures, pressuring American companies that invest in China to transfer technology to a Chinese partner, or hacking U.S. companies’ software.

If the investigation finds that China violated trade laws, the executive branch could issue sanctions against China that go far beyond tariffs. The results of the Trump administration’s investigation could change what many Silicon Valley companies, striving to do business in China, have long seen as the price of entry.