The recent bullying of Google by the Chinese Communist regime is the latest example of how American companies have a problem doing business in China. American companies need to rethink their approach.
In mid-June the regime framed Google for spreading “pornographic, lewd, and vulgar content.” The regime did so by manipulating Google’s search engine in China. By bombarding it with search requests for phrases that might have a sexual meaning, Google.cn would return these phrases as top results when even a benign word was searched.
On June 18, the host of the popular prime time show “Focus Report” on the state-run CCTV demonstrated how Google was supposedly saturated with sex by searching “son” and getting the phrase “son, mother, inappropriate relationship” as the top result. The previous week Google.cn had been bombarded with searches for this unusual phrase, producing this strange result.
The next day, the regime ordered Google’s Suggest and translation functions be disabled. On June 24, the regime shut down the search engine for a few hours.
The latter was a public punishment, a warning to Chinese citizens and Western business of the power of the regime. But the real punishment for Google was the disabling of the Suggest and translation features.
These features gave Google a competitive advantage over some other search engines operating in China. They also made it easy for individuals inside mainland China at least to see links that the communist regime had blocked. Closing down access to this information was the real reason behind the weeks-long charade of “proving” Google was making pornography easily available over the Internet.
The American strategy for doing business in China seems to be to kowtow to the Chinese communist regime—to submit abjectly to it. In 2006, Google, in response to regime pressure, had eliminated from searches on Google.cn results that make the regime uncomfortable: Web sites that had information on Falun Gong, Tibet, the Tiananmen Square Massacre, and freedom of speech.
But this previous capitulation by Google of its long-held business practice of affording users honest and transparent searches did not protect Google this June when the regime decided to tighten repression even further.
New York Times Columnist Nicholas Kristof provides another example of the high-tech kowtow. He has confirmed that the new Microsoft search engine, Bing, censors results in Chinese-language searches, even if they are conducted outside China. This self-censorship goes far beyond what Google did. The spokesman for Microsoft has claimed that Microsoft’s policy is that searches should not be censored outside China. Presented with the fact that the searches outside China are censored, Microsoft has claimed this is just a bug in the software. But Microsoft’s claims are hard to believe.
In 2003 Microsoft supplied the Chinese Communist regime with part of its source code, something that the American government hadn’t been able to pry loose with antitrust law suits lasting years.
Yahoo! is another internet giant who notoriously aided the Chinese Communist regime in it repression by turning over the names of dissidents who had used its service.
Western tech companies have provided the regime with various types of technology that help persecute innocents and suppress the Chinese people, including encryption, internet surveillance, and video surveillance.
In their kowtow to the Chinese Communist regime, American companies abandon their own principles for the sake of profit.
By cooperating with the Communist regime, Google has lost the integrity and now part of the functionality of its searches. Yahoo! has lost its good name. Microsoft has sacrificed its jealously guarded source code.
Most Western companies find the promise of great profits in China to be a cruel illusion. Some, however, are making money at the moment, and doing so by cooperating closely with the regime.
Each company has acted like the victim of a blackmailer who assumes each payoff will be the last. But this is to fundamentally misunderstand the Communist regime. It has no scruples about piling one demand onto another and its goal in fact is to reduce the independent Western companies into complete dependence on the regime. Once that dependence is gained, any profits that are earned will depend on the whims of the regime. Western companies simply don’t understand how ruthless the regime is, when it has power.
Western companies have submitted to the regime because each has dealt with the regime individually. Submission has seemed to be the price for doing business in China.
Before Microsoft surrendered its source code in 2003, it successfully defended it in 2000 by joining with other tech companies. If Microsoft had once again joined with other tech companies in insisting that proprietary technology would remain secure, the regime would have backed down.
Blinded by their greed for the China market, Western companies have not understood how desperately the Chinese regime has needed them. Foreign trade accounts for 60 percent of China’s GDP, and 50 percent of the profits are created by foreign companies.
With the real unemployment figures in China reaching about 25 percent , and with a democratic and rapidly modernizing India becoming a very attractive market, the Communist regime is vulnerable to Western pressure.
Western businesses need to return to fundamental principles. In resisting the Chinese Communist regime’s bullying, Western companies are protecting their own future. In China today, Western businesses will make the right business decision if they make the right moral decision. If they ask whether their business practices will help harm innocent people, then they will know where the path to profit lies.
 Zeng Xiangquan, Dean of the School of Labor and Human Resources, said in early 2009 that in the past three years, the Chinese Statistics Bureau’s internal report (unpublished) revealed that the unemployment rate was about 24 percent, and sometimes even reached 27 percent. The situation is expected to be worse in 2009.
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.