by GIL BARNDOLLAR
President Donald Trump gave Chinese social media phenomenon TikTok a slight reprieve last week, issuing an executive order that allowed the company 90 days to find a U.S. buyer. America is overdue in taking social-media-as-surveillance seriously, especially when these platforms are at the mercy of the Chinese Communist Party. But the search for an American buyer of TikTok highlights a dangerous myth: the idea that Big Tech must save us from Big China.
July’s congressional antitrust hearings provided another example of this narrative. Though only Facebook’s Mark Zuckerberg explicitly mentioned China in his opening statement, the People’s Republic was an unspoken counterpoint to every CEO’s inspiring personal narrative of “only in America.”
For some time now, tech’s defenders have made the case that the United States needs big, unconstrained tech “national champions” to fend off the likes of China’s Alibaba, Baidu and Huawei. Antitrust enforcement, the argument goes, may need to be revised or ignored to allow American monopolies to compete globally with their Chinese rivals.
There are three major reasons to be skeptical of the China defense employed by America’s new would-be national champions.
First, there is increasingly little reason to think of America’s biggest tech companies as American companies. Though currently eager to embrace that label, Silicon Valley’s stars are global firms who do much of their business abroad (and hide their enormous profits there). China is a key supplier, and a potential key market, for Big Tech.
Google may or may not be “seemingly treasonous,” as Peter Thiel has alleged, but the company did attempt to build a censored search engine for China while declining to continue work on artificial intelligence for the U.S. Department of Defense. Amid a trade war and talk of economic decoupling, Apple has sought to deepen its supply chain in China.
TikTok, increasingly the subject of scrutiny, was only able to penetrate the U.S. social media market due to heavy advertising on Facebook. Facebook may still be shut out of the Chinese mainland, but it’s not for lack of trying. In 2015, Zuckerberg reportedly went so far as to ask Chinese President Xi Jinping to name his unborn child.
Google, Facebook, Amazon and Apple wrap themselves in the American flag when convenient. All four, when pressed by Congressman Ken Buck (R-CO), abjured the use of (Chinese) slave labor in making their products. But their past actions and continuing palpable hunger for Chinese profits undermine any claim to be American national champions.
We have been here before. In the lead up to World War II, American monopolists helped fuel Nazi Germany’s war machine through cartel agreements—while at home, they hindered war production to keep prices high. Six months before Pearl Harbor, Harold Ickes, secretary of the interior, said: “If America loses this war, it can thank the Aluminum Corporation of America.”
Second, the scale and dominance of America’s biggest tech companies has created, not closed, unique national security vulnerabilities. This is especially true in social media.
Even the most zealous China hawk isn’t afraid of a physical Chinese invasion of the United States. But subversion and disinformation is another matter. America, beset by internal problems and vitriolic political partisanship, increasingly feels like a powder keg. Social media disinformation during both the 2016 election and the coronavirus pandemic, some of it driven or amplified by foreign actors, has deepened these divisions.
The First Amendment need not be a bar to at least identifying and rebutting foreign propaganda before it infects America’s public discourse. But the size and the advertising-driven model of Facebook, YouTube and other platforms prevents effective oversight and moderation. The business model of these companies may be fundamentally irreconcilable with basic corporate responsibility. Facebook hosts billions of post a day—and is run by an algorithm that apparently promotes Holocaust denialism.
Finally, if left unregulated and unfettered, America’s Big Tech national champions are likely to follow the path of most monopolies: away from innovation and towards sclerosis, financialization and rent-seeking.
America’s defense industry is instructive. In the 30 years since the end of the Cold War and the consolidation of defense into a handful of behemoths, the United States has endured a ceaseless wave of defense procurement disasters. Whether it is the trillion-dollar F-35 or the militarily useless Littoral Combat Ship, system after system underperforms at exorbitant cost. At the mercy of its defense monopolies, the United States has lost the ability to make an affordable and effective warplane or ship, even as competition—if not conflict—with China looms.
Amazon’s Jeff Bezos invoked Boeing in his opening statement to the antitrust subcommittee, as a testament to the power of scale. Boeing, in fact, now stands as one of the best warnings about monopoly and the national champions narrative.
In the two decades since it merged with McDonnell Douglas, Boeing has gone from being the crown jewel of American manufacturing to a scandal-ridden, financially-distressed giant that kills its customers. Numerous journalistic accounts have shown that as Boeing became America’s jet monopoly, its corporate culture evolved from engineer-driven innovation to outsourcing and financial optimization. The lesson for America and for Big Tech couldn’t be clearer.
Intel’s July announcement that it was considering outsourcing semiconductor manufacturing was another body blow to both American prestige and national security. Like Boeing, Intel was considered a cornerstone of American high-tech manufacturing. Its failure further demonstrates the folly of relying on Big Business and Big Tech to save America.
Yet despite these inconvenient realities, expect to hear more about China if the political pressure on tech monopolists continues. To paraphrase Samuel Johnson’s famous take on patriotism: The China defense may be the last refuge of the Big Tech scoundrel.
Gil Barndollar is a senior fellow at Defense Priorities and Senior Research Fellow the Catholic University of America’s Center for the Study of Statesmanship.
Article originally published at Newsweek.