It has been nearly a year since I wrote about my frustration with the West’s acceptance of China’s double standards, unfair play in international trade, and currency manipulation. Since then, we have exited recession, the bill for the stimulus has come in much lower than anticipated, and many sectors of the U.S. economy are once again turning healthy profits. Now certainly seems like the right time for us to pull our tail from between our legs and grow a pair, and recent developments seem to indicate that will finally happen.
While I burned with anger time after time over the past year as Obama and his administration kowtowed to China, overlooking slight after slight, ignoring their horrific record on human rights, and letting them get away with cyber crime. Finally, led by an interesting champion – Google – the U.S. government is starting to make moves to reassert itself and hold China accountable for its actions. Admittedly, in the midst of crisis, I can see the practicality of not biting the hand of our largest creditor. My hope is that as our economy reinvigorates, so will our resolve to ensure that China plays by international trade regulations and the rule of law. Issuing a request for a formal explanation of the recent hacking attempts on Google and the defense and chemical industry is a welcomed first step.
It is refreshing to see Google so strongly rebuke China for trying to hack into the Gmail accounts of dissidents and human rights activists, and finally refusing to filter search results of views contrary to the Chinese government’s interests. It is also good to hear several other firms, including Yahoo, speak out on Google’s side. (Shame on you Microsoft and GM for not having the chutzpa to do the same!)
Traditional wisdom has said China cannot be ignored because it represents the largest potential market in the world. The problem has always been that China uses foreign firms trying to enter the Chinese market to acquire skills and technology, and then actively stacks the deck against them. This has been accomplished in large part by not allowing majority foreign owned companies to exist (most foreign operations of multinationals in China are at least 51% owned by a local partner) and applying tariffs on imports. Very little money has been made by outside firms in China over the past 20 years – rather we have simply given them everything they need to compete against us. It is about time that Western companies started recognizing that it is nigh impossible to make money in China, and not being afraid of being left behind by choosing not to do business there.
Perhaps if the U.S. government is too frightened to take the lead against Chinese cheating, abuses, and criminal activity, our newly sagacious corporations will raise their swords and drag the reluctant politicians into the battle.
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