Don’t Be Medieval, Google Critics

August 7, 2018

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The Intercept recently reported that Google is developing search and news apps that will comply with Chinese censorship laws. The revelation surprised some, given that Google had famously decided in 2010 to mostly withdraw from the Chinese market. But detractors have already criticized the company’s potential reentry, with six U.S. senators, led by Sens. Mark Warner (D-VA) and Marco Rubio (R-FL), arguing that the project is “deeply troubling” and “risks making Google complicit in human rights abuses.” While concerns about China’s human rights and trade policy abuses are legitimate, attacking U.S. companies for trying to gain market share in China undercuts efforts that would lead to more U.S. jobs and increased U.S. competitiveness. Policymakers should support, not attack, efforts by U.S. companies to sell more goods and services in China. 

Google has a complicated history with China. In 2006, the company began operating a censored version of its search engine in the country. But in 2010, the company discovered a “highly sophisticated and targeted attack” on its corporate infrastructure originating in China that resulted in the theft of the company’s intellectual property. In response, Google announced a dramatic shift in its approach to the Chinese market and began operating an uncensored Chinese-language version of its search engine based out of Hong Kong.

While many praised Google’s decision at the time, its withdrawal from the Chinese market did not have any significant bearing on China policies regarding human rights, free speech, or other related issues, and its unilateral protest has attracted little support from other U.S. companies. It is fanciful to suggest that the Chinese government would change its economic or political practices today if Google chooses to remain on the sidelines in China or that the company will singlehandedly delegitimize China’s policies by doing so. Regardless of whether Google decides to reenter the Chinese market or not, China’s policies on these issues are outside the control of the private sector, especially one American company with virtually no leverage on the Chinese government.

In hindsight, Google’s withdrawal was clearly a win for the government, as Google’s Chinese competitor Baidu now has a near monopoly on the Chinese market and is rapidly expanding its market share globally, competing against Google and Microsoft in other markets. However, Google’s re-entry into the Chinese market does challenge Baidu’s dominance, which if successful, would mean more U.S. jobs, a better trade balance, and improved global competitiveness. Arguably competing in China is a better way for Google to embody its unofficial motto: “Don’t be evil.”

For all the outrage, Google’s re-entry into China is not exactly breaking new ground. Many U.S. tech firms, including Apple, Intel, and Dell, earn a combined annual revenue of between $100 billion and $150 billion from China, revenue which supports jobs in the United States. And Microsoft, which makes approximately $9 billion in annual revenue in China, even operates a filtered version of the Bing search engine in China. There are legitimate criticisms about China’s policies, but U.S. foreign policy embraces trade with China, so U.S. companies should not face political blowback for engaging in these types of commercial activities.

Unfortunately, the recent criticism of Google reflects a growing trend among policymakers to attack companies that operate lawfully but do not conform to their preferred set of political beliefs. Facebook, for example, has faced outrage from Republicans for its treatment of conservative media personalities, while Democrats have heaped scorn on the social network for not banning them faster. Businesses find themselves in these no-win situations where any choice they make will subject them to a public shaming.

Policymakers are free to question U.S. foreign policy towards China, but they do U.S. interests no favors by attacking U.S. companies that merely follow the course charted out by their own trade policies. And unless the United States decides to withdraw from the global economy, China will be a key trading partner and one that U.S. companies should continue to try to sell to. Abandoning that market to Chinese companies means not only losing market share in China, but risks losing market share globally and ultimately reducing U.S. competitiveness in the tech sector. U.S. policymakers should prioritize what is good for the U.S. economy, not what is good for China.