For decades, both adversaries and allies of Washington have spied on American companies to gain insights into innovation in the United States. During the Cold War, KGB spies routinely sought to steal trade secrets from U.S. industries. In the 1980s, French intelligence stalked American technology firms. In recent years, China has been especially aggressive on this front. The Center for Strategic and International Studies recorded 224 incidents of Chinese-sponsored espionage against the United States that occurred between 2000 and 2023, of which more than half targeted commercial technologies. Invariably, the goal of this kind of espionage is to help key sectors in the spying country rapidly replicate or surpass American advances. As the former National Security Agency director Keith Alexander memorably put it, cybertheft of U.S. technologies amounts to “the greatest transfer of wealth in history.”

Yet amid this brazen robbery, the U.S. intelligence community has long maintained a policy against spying on foreign companies to provide a commercial advantage to U.S. businesses. That self-imposed ban on economic espionage was reaffirmed repeatedly throughout the Cold War and in the decades since, including by President Barack Obama, who codified it in 2014 and tried to get China and other countries to follow suit. At the time, this made sense. U.S. economic policy had long forsworn government intervention in the private market, and providing select firms with secret intelligence would unavoidably distort the economy. In any case, through much of the Cold War and early post–Cold War era, most technological innovation important to national security emerged under government auspices rather than in the commercial market. Moreover, its lead in many technologies meant that the United States had much more to lose than to gain by legitimizing commercial spying.

Today, these rationales no longer hold. To an ever-growing extent, U.S. national security now depends on private-sector innovations. In such disparate areas as artificial intelligence, semiconductors, quantum science, bioengineering, next-generation energy, and space, breakthroughs that are crucial to the country’s power and influence are emanating from private companies. At the same time, even as technological supremacy has become increasingly central to national security, the U.S. lead in many crucial advanced technologies is being contested or even erased by China. By abstaining from economic espionage, the United States has tilted the playing field against itself and magnified the Chinese threat.

To right the balance, the United States should allow U.S. intelligence agencies not only to collect commercial secrets from foreign companies but also to deliver that intelligence where it could have the greatest impact: to the firms producing the frontier technologies that will be vital to U.S. national security in the years to come. In September, the Trump administration appeared to take a step in this direction when it disclosed that the CIA and other intelligence agencies had begun to broaden their long-standing espionage efforts against China, including Chinese industry.

But a comprehensive strategy requires the United States to formally lift its existing prohibition on economic spying. The government must also establish robust rules and oversight to ensure that commercially valuable intelligence shared with the private sector serves the national interest, preserves competition, and, critically, is not used to advance partisan, political, or personal ambitions. Although economic espionage is not without risk, unilaterally renouncing the practice in the current global environment is far more dangerous.

Although the United States has generally avoided commercial spying, it is not without precedent in American history. During the founding period, both early states and the newly formed Republic paid bounties to private citizens to encourage the theft of crucial technology from Britain. To Alexander Hamilton, the first secretary of the treasury, obtaining pilfered industrial secrets was a crucial way to spur the country’s economic independence from its former colonial master. But as Hamilton’s economic interventionism gave way to Thomas Jefferson’s laissez-faire approach, the bounty programs faded away.

The first modern U.S. debates about economic espionage date to the Cold War. In the early 1970s, when Japanese manufacturers began to pose a threat to the American auto industry, the Nixon administration considered having the government provide intelligence to Detroit automakers to improve their commercial prospects. But the president’s Foreign Intelligence Advisory Board rejected the plan as “inappropriate.” During the Carter administration, Stansfield Turner, the director of the CIA, again broached the idea of economic espionage internally at the agency but also met with strong resistance. As Turner later recounted, CIA officers “did not see helping business as being part of their mission of promoting national security.”

At the end of the Cold War, as the national security community turned its focus away from ideological and military competition with the Soviet Union, economic security took on new importance. In a 1991 article in these pages, Turner, who had stepped down from the CIA at the end of the Carter administration, called on U.S. intelligence agencies to pursue “economic intelligence” to prevent the country from being surprised by technological breakthroughs elsewhere. “If economic strength should now be recognized as a vital component of national security, parallel with military power,” he asked, “why should America be concerned about stealing and employing economic secrets?”

In 1996, the CIA told the Senate Intelligence Committee that it had identified numerous foreign governments that were doing precisely this—not only rivals such as China, Cuba, Iran, and Russia but also allies such as France and Israel. According to news reports, French intelligence had installed microphones in the first-class seats of Air France jets to eavesdrop on American business executives’ conversations; Pierre Marion, who served as head of French intelligence in the early 1980s, acknowledged that French President François Mitterrand had expressly ordered the government spy agency to steal the secrets of U.S. tech companies.

Nonetheless, Washington continued its self-imposed refusal to engage in the practice. Having the government provide commercially valuable secret information to select companies ran counter to the country’s ingrained free-market orthodoxy. It also ran against the deep-rooted cultures of the agencies themselves. As a case officer told CIA Director Robert Gates in the early 1990s, “I’m prepared to give my life for my country, but not for a company.” In a 1996 review of U.S. intelligence practices, a nonpartisan commission called for improvements in the quality of economic intelligence, but it also “strongly” endorsed existing policies that barred “clandestinely collecting proprietary information of foreign commercial firms” to help American companies. Summing up the thinking at the time, the........

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