
Western firms kowtow to China's increasing economic clout - everybodyknows
https://www.dw.com/en/western-firms-kowtow-to-chinas-increasing-economic-clout/a-50797033
======
faitswulff
While the post goes over a few instances of companies that have acquiesced to
China's political views, this reddit post has a much larger list:
[https://www.reddit.com/r/HongKong/comments/dfg1ce/list_of_co...](https://www.reddit.com/r/HongKong/comments/dfg1ce/list_of_companies_under_chinas_censorship_orders/)

~~~
yegle
It's like an improved Soviet joke:

American: in our country we have the freedom of criticizing our president
Chinese: we sure have the freedom to criticize your president American: no no
I mean you need to have the freedom to criticize your president Chinese: we
can't, but can you? American: well...

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htfu
"Forced to", "had to" doesn't strike me as appropriate language. These are
choices - some in reaction to threats or bans but many entirely
speculative/pre-emptive.

~~~
blueboo
Publicly shared companies have a legal obligation to make money for their
shareholders.

If a stakeholder in a major market can influence whether or not these
companies can make their revenue forecast (and therefore making institutional
investors' pensions solvent and individuals' mortgage payments payable) then
yes, they can force such companies to capitulate to them.

The third forcing function to reckon with -- the moral duty to uphold Western
countries' increasingly nebulous, compromised values -- has barely any
leverage in this equation.

What is a responsible, law-abiding executive supposed to do?...

~~~
axaxs
This is often repeated, in part because of some dubious behavior between Ford
and the Dodge brothers, but not precisely true.

"modern corporate law does not require for-profit corporations to pursue
profit at the expense of everything else, and many do not do so."

See:
[https://www.lawschool.cornell.edu/academics/clarke_business_...](https://www.lawschool.cornell.edu/academics/clarke_business_law_institute/corporations-
and-society/Common-Misunderstandings-About-Corporations.cfm) and the linked
Hobby Lobby case opinion.

~~~
blueboo
Hair-splitting. The obligation is enshrined in law. Shareholders invoke it.
The consequences are a change in leadership, not jail.

To quote the linked opinion:

> In nearly all legal jurisdictions, disinterested and informed directors have
> the discretion to act in what they believe to be the interest of the
> business corporate entity, even if this differs from maximizing profits for
> present shareholders.

This is a perfect example. Western companies are antagonizing their US market
in favor of developing a future Chinese one.

~~~
axaxs
It's not, though. To counter your original point, a corporation could decide
to not appease China, even if it means a loss in profits. They could justify
it any number of ways, saying the US market may be more valuable to their
company, or that trade tensions with China make things unstable. There is no
legal basis forcing companies to appease China.

~~~
jjeaff
Exactly. And even if there was a legal obligation to make money at all costs,
it could easily be argued that kowtowing to China is a short term strategy
with severe long term consequences. You might make more money now, but that
will be negated when they steal your IP and the government siezes your
property.

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mensetmanusman
I wonder if this will stop western firms from taking any political stances in
the west, because right now the optics are... interesting to say the least.

~~~
nine_k
Only taking the already prevailing political stance is safe, and has always
been.

Free speech being seen increasingly less valuable than other things (fairness,
care for the unprivileged, social peace, etc, depending on your country), and
the ease of raising massive furor in social media, I suppose firms will firmly
stay away from taking any political stance, except pleading allegiance to the
currently prevailing view.

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AndyMcConachie
Alternative title.

People who want to make money kowtow to the opinions of people with money to
give them.

~~~
mac01021
Sort of, but in this case circumstances are somewhat complicated by the PRC's
authoritarian government which is prepared to deny market access for political
reasons.

So it's not the opinions if the people with money to give that are at issue
here but the opinions of the gatekeeper, which actually is a remarkable
phenomenon.

~~~
627467
Was China less authoritarian in the 80s and 90s when mass manufacturing
migration between West and East started?

The West gave China the capital they are now using. Soft and hard capital and
power.

It seems cheaper to fight media-propaganda proxy wars than actually do
anything about it - as in, promote reversals on this manufacturing divestment.

~~~
CharlesColeman
> Was China less authoritarian in the 80s and 90s when mass manufacturing
> migration between West and East started?

No, but back then many people assumed trade would liberalize China. Turns out
they were wrong, at least for the foreseeable future.

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chank
Economic clout or greed? "We've pretty much saturated western markets and
China is the only market left to make more money even though we're doing just
fine"? Pretty much all of the companies bending the knee don't need the money.

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braindongle
The Great and Wise Randy Marsh has said all that needs to be said about this.

[https://www.facebook.com/southpark/photos/a.412559132004/101...](https://www.facebook.com/southpark/photos/a.412559132004/10156698439247005/?type=3&theater)

------
WomanCanCode
I understand that companies need to do everything in their power to maximize
profits. However, we as concerned citizens should also not 'enrich' these
companies by continuously supporting them. We are simply lucky that we are
living in a relatively free world when so many are not.

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devoply
Looks like though this is the future. It's Capitalism where you love a
product, say freedom of speech or democracy, but the company that supplies it
gets bought out. And now you can't get that product anymore because it's not a
part of the new company's corporate strategy. It's the same thing really. All
these companies get bought out by the Chinese. Same thing goes for natural
resources and the environment. They are just being bought out. Get things you
need while supplies last.

It would be interesting to see Trump pass a law prohibiting any US company
from doing this... from stiffing freedom of speech to support China.

~~~
el_cujo
I'm not a huge fan of capitalism, but it's a bit of a stretch to call this
situation a failure of capitalism when the whole debacle exists because the
Chinese government is making demands of Apple, which is not very capitalist.
It doesn't really make sense to attack the ideology using an example where the
ideology isn't really in practice, unless your point is that capitalism fails
because it isn't flexible enough to work in a world where it does not reach
100% adoption. If so, fair enough, but I think that same criticism applies to
every other economic system.

~~~
devoply
What if on the other hand this is the fundamental aspect of Capitalism...
Where the people with capital are always telling other people who might want
access to whatever they are holding, money, markets, production, whatever,
that if they don't kowtow they won't do business with them. And no one talks
about it, just like no one talked about all the Chinese hacking so as not to
ruin their reputation and anger China.

~~~
luckylion
First of all, it's not a capitalism-issue. Pre-capitalism, any smith could've
told you to take your horse elsewhere if they didn't like you.

> just like no one talked about all the Chinese hacking so as not to ruin
> their reputation and anger China.

I feel like that's a bubble issue. I'm not particularly interested in the
latest "China hacks XYZ" stories and I see them all the time. If you have the
impression that nobody talks about them, I think you might need to read more
main stream news, they do get a lot of play.

~~~
devoply
I don't mean currently no one talks about China, I mean there was a period
after 2009 where there were a number of hacking incidents that no one talked
about until much later.

As for a Smith refusing, yes, that could be the case. But there was no
consolidation of power and industry as there is in Capitalism. So you could
easily find many other Smiths to help you with whatever you needed. Going
forward there are many specialized industries many of which are extremely
consolidated. So you can't just go to someone else they own a whole spectrum.
And that also makes it much easier for China to shut down things, as they
could blacklist a whole set of businesses not just one.

~~~
luckylion
> So you could easily find many other Smiths to help you with whatever you
> needed.

I don't think that's accurate. The world expanded a lot since then, you can
_now_ buy online, order something from across the world etc, but you couldn't
do that 200 years ago. If you were in bad standing with whoever sold what you
needed, you'd have to go through a lot of trouble to source it elsewhere.

I'm with you that nation states/blocs need to make sure not to rely on foreign
companies for key industrial needs. It's why I consider Europe's reliance on
US IT companies a problem. The US will make sure they don't depend on China,
so I'm sure that there will be at least two choices in the foreseeable future.
Just make sure you don't piss off China and the US simultaneously.

