American Companies Need to Hang Up on Beijing

The COVID-19 global pandemic has made video conference calling a basic tool for both socializing and business alike. But recent revelations that Zoom closed American accounts on demands from Beijing point to a worrying trend of American companies muting basic rights to accommodate autocrats abroad. When companies ride roughshod over American values overseas, their actions have tangible negative implications for American consumers at home.

Earlier this month the video calling platform Zoom confirmed that it had suspended or terminated several accounts used to host public vigils for the Tiananmen Square massacre at the request of the Chinese government. Two of the now-reinstated accounts were based in the US, while another was based in Hong Kong. Following public outcry, Zoom says it will unveil more sophisticated tools to only target accounts that are actually based in mainland China.

But Zoom is not the only American company to grapple with balancing the economic opportunity of the Chinese market with Beijing’s aversion to freedom of speech and privacy. Following a massive Chinese-based hacking attack in 2010 and a tense relationship with Beijing, Google began winding down its operations in the People’s Republic. But by 2018 it was revealed that Google was developing a search engine that would comply with China’s censorship demands, dubbed Project Dragonfly. The decision was met with swift backlash from rights advocates and Google’s own employees, forcing the company to publicly abandon the project.

Far from the world of Big Tech, even the NBA has come under immense pressure to censor comments that the Chinese Communist Party dislikes. In October 2019, Houston Rockets Manager Daryl Morey tweeted an image that read, ‘Stand for Freedom Stand with Hong Kong,’ in support of then-ongoing protests. While the NBA quickly distanced itself from the comments, that move garnered backlash from politicians on both sides of the aisle.

NBA commissioner Adam Silver later clarified that the NBA would not regulate what players, employees, or owners would say. But almost all of the NBA’s local Chinese sponsors suspended their partnerships with the league, and Lakers star LeBron James denounced Morey, saying that “he wasn’t educated on the situation at hand.”

When American companies acquiesce to Beijing’s crackdown on rights, their actions have tangible ripple effects for American consumers. Zoom’s new censorship feature will only suspend Chinese accounts—but it will also limit Americans’ abilities to communicate with foreign counterparts in mainland China. Similarly, Beijing’s pressure on sports figures risks reshaping what American players and managers will say to American fans on American soil. In an international marketplace, the effects of these censorship efforts do not stop at American borders.

It is not a new idea that companies shouldn’t check their American values at the door when they operate abroad. The Kimberley Process and the Clean Diamond Trade Act (2003), for example, seek to stop blood diamonds from making their way into the American market. Similarly, the Treasury Department’s expansive sanctions program limits the ability of American companies to do business with state-sponsors of terrorism, such as Iran. These programs recognize that the line between the American and international economy is thin, and American consumers have an interest in protecting basic rights.

In a globalized world, American companies will continue to face the challenge of balancing their own values with the demands of unscrupulous actors abroad. But yielding to crackdowns on basic rights like freedom of speech and privacy abroad also effects American consumers. As the costs associated with appeasing the Chinese Communist Party become increasingly apparent, American businesses should consider hanging up on their demands.

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