Google has gone where our governments won’t dare
The news last week that Google had delivered an ultimatum to the Chinese government caused an outburst of debate, comment and analysis throughout the media. In a post on Google’s official blog, the company’s Chief Legal Officer David Drummond set out the pledge: China must improve trading conditions or Google would withdraw. Officially this was because a number of cyberattacks had targeted the internet giant. Google has not explicitly linked these to the Chinese authorities, but it has carefully pointed out that the email accounts of some Chinese human rights activists and dissidents appear to have been routinely hacked.
Google’s operations in China had been controversial since they began in January 2006. Especially since Google had agreed to censor search results to suit the Chinese government. The arrangement was interesting partly because multi-national companies are normally noted for steamrollering over local customs and traditions, yet here Google had accepted the Chinese government’s conditions as part of the deal that allowed it to operate in China.
Initially, this murky agreement between Google and China worked well for both parties. Google got access to a lucrative market and the Chinese government could still control access to information in the country. Writing in the Times, George Walden argues that Google’s decision must be seen in this light. Google and the Chinese government had found an arrangement that appeared to work. All of that changed with the cyberattacks, and so Google delivered the ultimatum. Part of this demand is that the censorship of search results be allowed to stop.
Google’s recent announcement has caused a storm of comment, especially from the blogosphere where Google’s decision has been treated with some scepticism – and there is good reason to be sceptical. The Chinese government backed search engine, Baidu, has been a strong competitor meaning that China is not as lucrative for Google as it might have been. Baidu controls 58.4% of the Chinese search market, compared to just 35.6% for Google, according to Analysis International. China has put huge restrictions on Google’s operation and then backed their main competitor. When you also factor in the PR nightmare that Google’s Chinese operations had become the arguments for pulling out begin to stack up.
While the cyberattacks appear to have raised concerns about corporate security, they may have also provided cover for Google to pull out of a difficult market without losing face. As the academic and blogger Evgeny Morozov has pointed out, cyberattacks are hardly peculiar to China. Google will have to defend itself against these wherever it operates and pulling out of China will not stop future threats.
Even though Google’s decision may not have been driven by any great principles, their stance shows that it is possible to stand up to China in a way that most Western governments have been cautious of. Far from demanding that China change unconditionally, Google has worked with Chinese authorities. Working with countries like China is the key to encouraging improvements there. Pragmatism and compromise are the keys to relations with a country like China.
In a sense, this is precisely what businesses do. They get a foot in the door and work under difficult conditions if necessary. Later they try to improve trading conditions. This is a central tenet of Wilsonian liberalism, that the spread of free trade will bring with it political liberalism. While Wilson was a utopian, it is certainly right that as businesses trade around the world, they introduce their own cultural, political and economic identities. Unable to do so in China, Google is now threatening to leave unless the economic environment begins to conform to its expectations.
While nobody realistically expects this confrontation to usher in a new era of openness in China, it could put pressure on the Chinese government to improve relations with foreign businesses and improve trading conditions for technology companies. China, which had grown increasingly nationalistic over recent years, is unlikely to back down but the affair may put pressure on other Western companies to make similar demands and it could reopen the debate about how the West deals with China.
Although Google’s motives are probably primarily selfish, these strong motivations have driven Google to stand up to China in a way that no Western government has yet dared. In fact, Western reactions to China have often been characterised by cowardice rather than principle. We all remember when Gordon Brown refused to meet the Dalai Lama in Downing Street for fear of upsetting the Chinese. Even the US has generally refused to be drawn into an argument about democracy or human rights in China, instead focussing on the strong economic ties enjoyed between the two countries.
Now Google has shown that China’s political authoritarianism can harm those economic ties. Furthermore, it has forced the US government to come into the dispute firmly behind Google. Hillary Clinton, the US Secretary of State, announced that she had “serious concerns” over the issue and there is even a suggestion that Google co-ordinated with the White House before the announcement was made. Google has pushed the US to confront China in a way that Western governments have previously sought to avoid.
While Google will probably not force China to liberalise significantly, the Chinese government should be wary of fighting against the internet. Already the much-hyped ‘Great Firewall of China’ can be by-passed with an anonymiser like Tor, which allows users to avoid filters anonymously. Chinese isolationism will struggle to remain dominant as the internet makes access to information easier and cheaper than it has ever been before.
As globalisation drives the world’s economies together, China cannot remain isolated from the rest of the world. With the internet, that is especially so. While the actions of a single company are unlikely to change China, Google has shown genuine courage by standing up to the Asian giant. Through creating a political as well as economic scandal, Google has increased the pressure on China to liberalise politically and economically.
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Just a question… precisely why should China just allow Google to eat up market share of a national search engine and, presumably, take profits out of the country?
In all the talk of liberating China’s economy, no one has adequately explained this to me, especially given that China bore witness to the 1997 collapse of the rest of East Asia’s ‘liberated’ economies, which was started by unfounded rumours surrounding the strength of the Thai Baht. In that sense, it seems reasonable for the Chinese to be wary of being too liberal with their economy.
It’s interesting that Google has taken this decision now, given that the human rights issues were well documented before Google went to China.
This smacks of Google trying to put a human rights spin on what is just sour grapes at having a state-backed competitor.
As for the spinelessness of our politicians, well perhaps they recognise the necessity of doing business with the Chinese. The Americans are in hock to them to the tune of over $1tn, we get all of our cheap domestic items made by them, and so perhaps our politicians realise how much people would be upset with them if they had to fork out a few extra quid for clothes and appliances just because they alienated the Chinese.
Sorry to be cynical, but in this day and age, I think these are the calculations modern politicians have to make.
Hi John, thanks for the question and comments.
I suppose your question gets to the heart of economic policy, I think the consensus is that allowing foreign companies to invest creates jobs, brings wealth into the country and opens up competition which (in theory) improves services.
The stuff about taking profits out of a country has been used by dependency theorists to argue that free markets are basically just a continuation of colonialism by other means. So there might be something in that but, frankly, suggesting that China is under anyones colonial influence would be a bit ridiculous.
I agree that Google probably wants to get out of a difficult market without losing face and this is a great chance to do that. But that doesn’t mean that it can’t be good, or Google can’t be doing the right thing, even if it’s motives are ambiguous.
I agree that China is in an unassailable position, much of this article argues that Google was probably right to secure a deal with China. My point, in a sense is that China can’t keep itself isolated for ever (that is especially the case in an internet age). So I agree with doing business with the Chinese, but it’s not an either/or choice. You can work with the Chinese while at the same time negotiating and compromising for the changes you want to see.
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