TikTok and the Future of US-China Relations
TikTok, a massively popular social media platform amongst teens, is the most recent casualty of the deteriorating relations between the US and China. Under Trump’s new executive order, the company must either sell itself to a US firm, likely Microsoft, or be banned in the US. The rationale for such a move: that the social media platform which shared videos of dancing teens somehow poses a national security threat is spurious. Nonetheless, it sets a dangerous precedent for the future of multinational tech companies wishing to expand into new markets, and poses ominous threats for the future of technological and economic globalization. It may portend a world where the latest advances in science and engineering will be confined to one nation’s borders, and not shared with the world at large. In a future where the world’s two largest economies, US and China, are locked in a technological Cold War, nobody wins and everybody loses. Economic and technological decoupling reduces the benefits to be gained from cooperation and makes conflict more likely. These trends are not inevitable but necessitate a fundamental rethinking of how nations interact with each other is necessary if we are to avoid a catastrophe.
The recent actions taken against TikTok by the Trump administration has rightly confounded many observers. To label a Chinese social media platform used predominantly by teens to share videos as somehow a national security threat sets the bar rather low. After all, most of TikTok’s data privacy practices are similarly employed by other tech firms, such as Facebook and Google. Yet, these firms are not labelled as national security threats. This double standard regarding Chinese and US tech firms reflect an attempt by the Trump administration to decouple the US and Chinese economies by deliberately targeting Chinese companies doing business in the US and other western countries. It is indeed an ominous sign when the president of the United States decides unilaterally to force a Chinese technology company with many millions of users to sell itself to a US firm or be banned from the US market. Many defenders of this action may cite that China has engaged in similar protectionist policies by banning Google, Youtube, and Facebook to promote domestic firms such as Baidu, Youku, and Tencent. This argument, however, is not convincing. When China banned Google, Youtube, and Facebook from its market over a decade ago, it was not following a policy of protecting and building up domestic competitors. At the time, China was still economically weak and technologically backwards, with no firms able to compete with America’s tech juggernauts. One could only access computers at government research institutions or universities, and there were few private sector technology firms worthy of mention. China did not seek to reverse its technological backwardness by shutting out multinational competitors to foster domestic firms, it did the opposite, by sending students abroad to study in American universities, inviting foreign multinationals to set up operations in China, and buying computers from US firms. In this way, Chinese engineers could learn and evolve by working with their foreign counterparts, and foreign multinationals could exploit the cheap and hardworking labor force China had to offer.
In its efforts to attract foreign multinationals to enter China’s market, as well as foster domestic firms, Beijing created its own version of Silicon Valley, called Zhongguancun, located close to China’s two top universities, Tsinghua University and Peking University. Many world renown tech firms established operations in Zhongguancun, such as Intel, AMD, Oracle Corporation, Motorola, Cogobuy Group, IBM, MySpace, Sony, Solstice, and Ericsson. Microsoft built its $280 million Chinese research headquarters here, employing 5000 employees and researchers. Thus, China was very open to foreign multinationals, seeing them as a way to modernize rapidly by learning from the best. While stories of Chinese censorship and the Great Firewall of China may paint the country as actively hostile to western firms, the reality is different. Lee Kai-fu, a former executive at Google China recounts his experience leading Google’s China operation. According to him, Google China failed not because of any deliberate action by the Chinese government to cripple foreign competitors, but because domestic competitors with better understanding of the Chinese market were able to mimic its services and offer a more appealing product to Chinese consumers. Rather than adapting their search engine to suit the internet browsing habits of each market, Google’s search engine remained uniform across all markets, changing little else besides the language. Baidu, in contrast, copied the useful aspects of Google’s search engine while adapting it to suit local conditions- by opening up a new browser window for each clicked link rather than navigating them away from the search results, for instance- and was able to outcompete Google in the China market. When Google, Youtube and Facebook were finally banned in China, it was because these companies refused to comply with Chinese censorship laws and censor politically controversial content in accordance with local rules and regulations. Had they decided to comply with these regulations, China would likely have been happy to allow these foreign firms to continue their operations. Bing, the Microsoft-based search engine, was allowed to continue operating in China after rolling out a censored version of its search engine.
The Trump administration’s ban on TikTok, however, differs from China’s bans on Google, Facebook, and Youtube. Whereas China’s government had laid out clear guidelines for foreign firms to continue operating in China, no such guidelines were made apparent to TikTok. Instead, TikTok was seemingly chosen at random as a political pawn in the ongoing US-China conflict. This is especially concerning as TikTok has taken many measures on its own initiative to allay US fears of its data collection practices, such as storing their data in the US, with backup servers in Singapore. There is therefore no concern that TikTok can or would share data with the Chinese government. Many of its data collection policies are furthermore not too different from those of other tech firms in the US. Thus, rather than laying out a clear set of rules concerning data collection which all tech firms, both US and foreign, must comply with, the US government has chosen to adopt a policy of lashing out at Chinese technology firms under the excuse of protecting national security. By doing so, the administration is forcing many Chinese tech firms to reconsider whether they should go ahead with their plans to establish a presence in the US market, or to continue investing in US tech firms. Considering that many US tech firms rely on Chinese investments to drive their research and development operations, the Trump administration’s moves to sanction Chinese companies may hurt American tech firms, which would see a reduction in their research and development budgets and lose competitiveness.
While it may seem politically expedient to criticize China to distract from the Trump administration’s own failings, the costs of doing so also warrant consideration. A deterioration in US China relations undermines prospects of mutually beneficial cooperation and understanding and makes conflict much more likely. Given that China is a nuclear power whose economic and military might far exceeds the old Soviet Union, a new Cold War between the US and China will inevitably prove much more costly and destructive. To avoid this disastrous outcome, each country should rediscover an old principle of international relations- minding its own business. The old Westphalian policy of respecting national sovereignty entails refraining from meddling in other country’s internal affairs and would help prevent much conflict around the world. China has largely adhered to this principle, refusing to interfere with wholly internal matters of foreign countries, while the US has taken the opposite approach. America has wasted trillions of dollars intervening in foreign countries and fighting prolonged wars, dollars which could have been put to better use at home. Rather than wasting funds in countless wars abroad, China has invested its savings into building a world-class infrastructure system. In the early days of the pandemic, the country was able to construct 2 hospitals in 10 days, and the central government was able to mobilize doctors from every province to help staff Wuhan’s hospitals. The People’s Liberation Army was also mobilized to help transport medical supplies and aid in the public health response. Thus, by focusing on our own problems rather than concerning ourselves with the affairs of nations on the opposite side of the globe, American interests would be far better served.
